(Reuters) – Zoom Video Communications Inc raised its adjusted full-year profit forecast on Monday, signaling renewed demand for its videoconferencing tools in a hybrid work environment, sending the company’s shares up 17% in the prolonged exchanges.
The increase in guidance comes at a time when demand for the company’s platform has declined in recent quarters from pandemic-induced highs in 2020 and competition is heating up from teams of Microsoft and Cisco WebEx and Google Meet.
However, in a tight job market, companies are offering hybrid working options, which requires investing in platforms like Zoom to stay connected.
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.
The company also forecast adjusted second-quarter earnings of between 90 and 92 cents per share, above estimates of 87 cents.
Zoom said revenue rose 12% to $1.07 billion in the quarter ended April 30, its slowest growth since its 2019 IPO. That was in line with Wall Street estimates, according to data from Refinitiv IBES.
Net income attributable to common shareholders fell to $113.6 million, or 37 cents per share, in the first quarter from $227.4 million, or 74 cents per share, a year earlier.
(Reporting by Eva Mathews in Bengaluru; Editing by Amy Caren Daniel)