Takeaways by Saasverse AI
- $1.22B Revenue (+4.7%) | $1.53 EPS (+10.1%) | Operating Cash Flow: $515.9M (+14.8%)
- Enterprise market shines: Large customers grew 8.7% YoY, AI innovations enhance collaboration capabilities.
- Raised FY2026 guidance, AI-driven transformation fuels optimism, stock up 4.5% after hours.
Zoom’s FY2026 Q2 results exceeded market expectations, showcasing the company’s ability to sustain growth in the post-pandemic era. The company reported $1.22 billion in revenue, a 4.7% year-over-year increase, and adjusted earnings per share (EPS) of $1.53, outperforming analysts’ consensus estimates of $1.38 EPS and $1.20 billion in revenue. These results highlight Zoom’s successful pivot to long-term sustainable growth, driven by its enterprise market focus and AI-powered innovations.
Zoom’s enterprise business was the standout growth engine this quarter. The number of customers generating over $100,000 in trailing 12-month revenue reached 4,274, an 8.7% increase compared to the prior year. Additionally, the enterprise dollar-based net retention rate remained strong at 98%, indicating that existing customers are continuing to invest in Zoom’s solutions. Meanwhile, the online segment’s monthly churn rate held steady at 2.9%, reflecting stability in the company’s digital subscription base. These metrics underscore Zoom’s effective shift from a consumer-focused model to a more resilient enterprise-centric strategy, where larger, more stable contracts anchor its revenue streams.
Cash flow performance was another highlight of the quarter. Zoom generated $515.9 million in net cash from operating activities, a 14.8% improvement year-over-year, and closed the quarter with a robust $7.8 billion in cash, cash equivalents, and marketable securities. CEO Eric Yuan emphasized the company’s AI-driven growth, stating, “AI is transforming how people collaborate, and Zoom is at the forefront of innovation to help our customers and employees work smarter while reducing costs.”
On the product front, Zoom continued to expand its AI capabilities. In June, the company launched Virtual Agent 2.0, an intelligent assistant designed to autonomously handle complex tasks like returns processing, account updates, and appointment scheduling. In July, Zoom introduced additional AI features, including the Custom AI Companion, which enables small businesses to deploy AI-powered assistants on third-party platforms like Google Meet. These developments reflect Zoom’s evolution from a video conferencing tool to a comprehensive enterprise collaboration platform, integrating AI and data-driven workflows to improve efficiency and productivity.
Looking ahead, the company raised its full-year FY2026 guidance, citing optimism around continued hybrid work trends and deeper AI integration across its product portfolio. Zoom now expects full-year revenue in the range of $4.83 billion to $4.84 billion, up from its prior guidance of $4.80 billion to $4.81 billion. Adjusted EPS guidance was also revised upward to $5.81–$5.84, compared to the previous range of $5.56–$5.59. For Q3, Zoom anticipates revenue between $1.21 billion and $1.22 billion, slightly ahead of analysts’ expectations of $1.21 billion. The positive outlook pushed Zoom’s stock price up 4.5% in after-hours trading.
Saasverse Insights
Zoom’s FY2026 Q2 results and strategic direction signal a successful transition from its pandemic-era boom to sustained, innovation-driven growth. The enterprise market’s robust performance demonstrates that hybrid work has become a corporate norm, with Zoom solidifying its position as a leader in enterprise collaboration. The company’s evolution from a single-purpose video conferencing tool to an integrated enterprise collaboration platform highlights a broader trend in SaaS: the shift from standalone solutions to unified, AI-enabled ecosystems. By focusing on data integration and AI-driven workflows, Zoom is addressing key efficiency challenges for businesses, setting the stage for long-term growth while opening new revenue streams.