Zoom Communications, Inc. · NASDAQ:ZM
Zoom Communications — Q3 2023 Earnings Presentation
20 slides from Zoom Communications's earnings presentation, Nov 21, 2022
Slide 1: Zoom Video Communications Q3 FY23 Earnings
Zoom Video Communications Q3 FY23 Earnings November 21, 2022 1
Slide 2: Use of non-GAAP financial measures
Use of non-GAAP financial measures In addition to the financials presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this presentation includes the following non-GAAP metrics: Revenue in Constant Currency, non-GAAP gross profit, non-GAAP gross margin, non-GAAP R&D expen
Slide 3: Safe Harbor statement
Safe Harbor statement This presentation and the accompanying oral presentation contain express and implied “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding Zoom's financial outlook for the fourth quarter and full fi
Slide 4: First hybrid Zoomtopia powered by Zoom Events
First hybrid Zoomtopia powered by Zoom Events Zoom Platform Innovations Announced: ● Zoom Mail & Zoom Calendar (beta) ● Zoom Spots ● Zoom Virtual Agent ● Continuous Collaboration across Zoom One ● and more! Highlighted the more than 1,500 features and enhancements Zoom launched this year
Slide 5: Customer wins highlight the power of the platform
Customer wins highlight the power of the platform 5
Slide 6: Continued top-line expansion with positive trends in Enterprise and Online
Continued top-line expansion with positive trends in Enterprise and Online Total Revenue1 Enterprise Revenue Online Average Monthly (in millions) (in millions) Churn2 Currency Impact 7% 20% 5% 1 Not drawn to scale. 2 Zoom calculates online average monthly churn by starting with the Online customer M
Slide 7: Strong growth with new and existing Enterprise customers
Strong growth with new and existing Enterprise customers # of Enterprise # of Customers Contributing >$100k in Customers1 TTM Revenue 14% 31% TTM Net Dollar Expansion Rate for Enterprise Customers2 117% in Q3 FY23 1 The number of customers is rounded down to the nearest hundred. Enterprise Customers
Slide 8: Double-Digit Americas growth but macro headwinds in ROW
Double-Digit Americas growth but macro headwinds in ROW Revenue1 YoY Growth Revenue Share by (in millions) Region2 APAC -3% EMEA -9% Americas 11% 1,2 Subtotals revenue have been rounded. 8
Slide 9: Q3 FY23 expenses and margins
Q3 FY23 expenses and margins GAAP Non-GAAP1 Results Yr/Yr Results Yr/Yr Revenue $1,102 million 5% $1,102 million 5% Gross Profit 75.4% +122 bps 79.5% +356 bps As a % of Revenue R&D Expense 17.8% +841 bps 9.8% +335 bps S&M Expense 38.8% +1,087 bps 27.3% +469 bps G&A Expense 12.8% +369 bps 7.9% +9 bps
Slide 10: Growing future revenue under contract
Growing future revenue under contract Total RPO1 Current2 & Non-Current RPO (in millions) YoY Growth (in millions) YoY Growth Total Total 32% 32% 41% 39% Unbilled Non-Current 49% 61% 33% 31% 59% 61% 67% 69% Deferred Revenue Current 14% 18% 1 Remaining performance Obligations (RPO) consists of both b
Slide 11: Strong cash flow and position in Q3
Strong cash flow and position in Q3 YTD Cash Balance Bridge1 (in millions) Operating Cash Flow $295M OCF Margin 26.8% Free Cash Flow $273M FCF Margin2 24.7% 1 Cash balance refers to cash, cash equivalents and marketable securities, excluding restricted cash at the end of the period. 2 See appendix fo
Slide 12: Q4 and Fiscal Year 2023 outlook
Q4 and Fiscal Year 2023 outlook Q4 FY23 FY23 Revenue $1,095 - $1,105 million $4,370 - $4,380 million Total Revenue $1,120 - $1,130 million $4,442 - $4,452 million (Constant Currency) Non-GAAP Operating Outlook1 $316 - $326 million $1,490 - $1,500 million Income Weighted Average Share 301 million 304
Slide 13: One Platform To Connect
One Platform To Connect zoom
Slide 14: Q&A
Q A 14
Slide 15: Thank You
Thank You 15
Slide 16: Appendix
Appendix 16
Slide 17: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q3 FY22 Q3 FY23 Q1-Q3 FY22 Q1-Q3 FY23 Gross Profit Total Revenue $1,050,756 $1,101,899 $3,028,488 $3,275,157 GAAP Gross Profit $779,799 $831,234 $2,231,281 $2,469,060 (+) Stock-based compensation expense and related payroll taxes $17,772 $41,848 $49,973
Slide 18: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands except EPS) Q3 FY22 Q3 FY23 Q1-Q3 FY22 Q1-Q3 FY23 Operating Profit Total Revenue $1,050,756 $1,101,899 $3,028,488 $3,275,157 GAAP Operating Profit $290,857 $66,508 $811,772 $375,316 (+) Stock-based compensation expense and related payroll taxes $118,708
Slide 19: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation ($ in Thousands) Q3 FY22 Q3 FY23 Q1-Q3 FY22 Q1-Q3 FY23 Free Cash Flow Cash Flow from Operations $394,556 $295,314 $1,395,870 $1,078,674 (-) Purchases of PPE $(19,767) $(22,698) $(111,816) $(75,568) Free Cash Flow $374,789 $272,616 $1,284,054 $1,003,106 Operating Cash
Slide 20: Historic Metrics
Historic Metrics ($ in millions) Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Revenue $882.5 $956.2 $1,021.5 $1,050.8 $1,071.4 $1,073.8 $1,099.5 $1,101.9 Y/Y growth 369% 191% 54% 35% 21% 12% 8% 5% GAAP Operating Income $256.1 $226.3 $294.6 $290.9 $251.8 $187.1 $121.7 $66.5 Stock-b