- Records a 357% y/y surge in market cap on the back of covid-19 vaccine
Zoom, a video conferencing platform witnessed a record-explosive growth despite the coronavirus pandemic as its revenues skyrocketed in 2020 when it recorded almost a 370 per cent year on year increase in its quarterly revenue to $882.5 million in the fourth quarter of the 2021 fiscal year. This revenue rise resulted from global demand for online meeting solutions which soared as a result of the COVID-19 pandemic.
According to the company’s financials, the popular video conferencing platform generated impressive revenue through its fiscal year 2021 with the year’s final quarter setting a new record.
With the ban on social gatherings and as millions of people started working from home, Zoom also became a cultural phenomenon through hosting parties, concerts, church services, and art shows. The surge in the number of users led to a 700 per cent revenue growth in two years. However, Zoom emerged as the most preferred platform for holding virtual meetings. As countries across the globe imposed lockdowns, family members also turned to Zoom as a way of keeping in touch with each other. Museums, theatres, and schools chose the platform to maintain normal operations.
According to the company’s earnings report, Zoom raised $330.5 million in revenue in the fiscal year 2019 and the numbers jumped by over 88 per cent to $626.6 million within the next twelve months. The double-digit growth was largely driven by a strong fourth quarter of fiscal year 2020 performance and matching the period between January and March 2020 when the pandemic struck. Consequently, the video conferencing platform reported a quarterly revenue surge of 78 per cent year on year to $188 million within the stated 3 months period.
Further afield, the strong increasing trend continued in the following months, with revenue rising to $328.1 million in the second quarter of the calendar year 2020. However, statistics show that this figure more than doubled in the next three-month period and hit $663.5 million.
Elsewhere, Zoom delivered the highest quarterly revenue in its history, causing annual revenues to rise above the expectations to $2.65 billion in the fourth quarter of the fiscal year 2021, matching the period between January and March 2021. Meanwhile, almost 70 per cent of that value which is about $1.83 billion was generated in the United States of America as the largest market for zoom. Also, the users from the EMEA region emerged as the second-largest market and generating $486 million in revenue as Asia followed with $332.8 million accordingly.
Irrespective of the noteworthy performance by Zoom communications, its stock price has seen an increase steadily throughout the year 2020. And while a positive announcement of the coronavirus vaccine in November 2020 led to a fall in its share price by more than 30 per cent by the close of the year. However, a month later (December 2020), the combined market capitalisation of the company stood at $115.5 billion, according to data by MacroTrends. But under the 4 months this year, the market cap figure dropped to $96.6 billion and signifying a 357 per cent year on year increase.
Frontpage August 10, 2020