(Reuters) – Zoom Video Communications Inc raised its adjusted full-year profit forecast on Monday, betting on strong demand from large companies in a hybrid work environment, sending the company’s shares up 15% in extended conversations.
Revenue from Zoom’s high-paying enterprise customers jumped 31% in the first quarter, accounting for 52% of its total revenue, the company said.
“We expect corporate client revenue to represent an increasingly larger percentage of total revenue over time,” Chief Financial Officer Kelly Steckelberg said in a post-earnings call with analysts. .
The company said adjusted operating margin increased 37.2% in the quarter ended April 30, as efforts to expand its enterprise offerings to customer service contact centers, cloud calling and successful analytics companies.
Zoom had recently announced the acquisition of Solvvy, an AI startup, and launched Zoom IQ, a call analytics tool for business services.
For the full year, Zoom expects adjusted earnings per share to be between $3.70 and $3.77, compared to earlier expectations of between $3.45 and $3.51.
However, the company said its revenue rose 12% to $1.07 billion in the first quarter, its slowest growth on record.
In recent quarters, demand for the company’s platform has slowed as COVID-19 lockdowns eased and competition intensified from Microsoft and WebEx teams. Cisco and Google Meet.
Still, the San Francisco-based company reported first-quarter earnings above expectations and forecast current-quarter earnings above estimates.
Shares of Zoom, a darling of the pandemic, have fallen 85% since hitting an all-time high in 2020.
(Reporting by Eva Mathews in Bengaluru; Editing by Amy Caren Daniel)