Will To Expect From Zoom Q4 Earnings?

Zoom Communications, Inc ZM will report fourth-quarter and fiscal 2025 results on February 24, after the market close.

Oppenheimer analyst Timothy Horan maintained a Perform rating on Zoom.

Horan expects solid fourth-quarter 2025 results as Zoom builds momentum through its new AI platform strategy, which is enabling some price increases.

Also Read: Unity Software Q4 Earnings: EPS And Sales Beat, Weak Guidance, Game Development Revenue Declines

The focus will likely be on 2026 guidance and the impact of new go-to-market movements and pricing on top-line growth.

Investors will also examine margins, which could be under pressure as it invests in AI and increases the adoption and usage of its AI Companion.

The analyst also hopes to gain more insight into CCaaS seat growth and cross-sell trends, though it is still in the early days.

He noted Zoom could beat Street’s expectation of 3% growth next year, but it could be above 4%.

Positively, the company cited strong AI uptake and is seeing solid momentum in Contact Center, Workvivo, and UCaaS. Overall, Horan liked Zoom’s product and its AI, while bundling puts it on par with Microsoft Corp MSFT Teams’ pricing.

Separately, Amazon.Com Inc AMZN announced it is shutting down support for Chime, its UCaaS service, and will no longer take new customers. Chime will be completely shut down in February 2026.

Zoom has historically maintained stable prices but increased monthly rates by 5-10% for SMB plans in the mid-fourth quarter. Though this will likely take 2-3 years to flow through fully, it could add 2% to annual revenue growth.

However, larger enterprises (~59% of revenue) resist paying more for services they do not necessarily want and typically receive a discount off listed prices.

Although a return to meaningful enterprise subscriber growth is unlikely, the company has significantly reduced churn in the past year and stabilized enterprise customers.

Positively, channel checks indicate that a large cohort of customers that signed deals in 2021/22 are coming due for renewal, so the analyst expects a solid first-quarter and fiscal 2025 guide in combination with the price increases.

Horan’s 2026 and 2027 revenue estimates are 50 and 110bps above the Street, respectively. The analyst expects Zoom to guide revenue above the Street, given the improving churn/quality and go-to-market.

His operating margin estimates could be too conservative, as he expects the company to reinvest for growth/ AI to achieve 5% revenue growth.

Horan projected fourth-quarter revenue of $1.2 billion and adjusted EPS of $1.29. He expects fiscal 2025 revenue of $4.7 billion and adjusted EPS of $5.42.

Price Action: ZM stock is down 2.05% at $83.42 at last check Thursday.

Also Read:

• User Engagement And High-Margin Businesses Fuel Bilibili Q4 Growth, CEO Highlights AI Potential

Image via Shutterstock