Zoom Video Communications Inc.

ZM
Financial Analysis · Updated May 18, 2026 · Coverage 2026-Q2
Latest Q Revenue
$1.2B
Q3 FY2026 · +4.4% YoY
TTM ROIC
13.8%
FY2025 · ROE (GAAP Net Income / Average Equity); traditional ROIC undefined due to negative invested capital (net cash exceeds equity)

Financial Snapshot

ticker: ZM step: 04 generated: 2026-05-13 source: quick-research

Zoom Communications, Inc. (ZM) — Financial Snapshot

Income Statement Summary

Metric FY2022 FY2023 FY2024 YoY
Revenue $4.10B $4.39B $4.53B +3.1%
Non-GAAP Op. Margin ~38% ~37% ~39%
GAAP Operating Margin ~20% ~15% ~25%
Net Income (GAAP) ~$1.4B ~$0.1B ~$1.3B
EPS (non-GAAP diluted) ~$4.95 ~$4.99 ~$5.11

FY2025: Revenue $4.665B (+3%); Non-GAAP EPS growing ~10% YoY; GAAP operating margin expanded to 26.4%. Q3 FY2026 (ended Oct 2025): Revenue $1.23B (+4.4%).

Cash Flow & Balance Sheet (FY2024)

Metric Value
Operating Cash Flow ~$1.6B
Free Cash Flow $1.47B
Capital Expenditures ~$0.1B
Cash & Equivalents ~$7.7B
Total Debt ~$0 (net cash ~$7.7B)

Zoom is debt-free with $7.7B in net cash — extraordinary for a ~$22B market cap company. FCF yield (~6.5%) and buybacks ($1B program authorized late 2025) make this a capital return story as well as a growth story. Also holds $2B+ Anthropic equity stake.

Key Ratios (approximate)

  • P/E: ~16x (non-GAAP FY2026) | EV/EBITDA: ~10x | FCF Yield: ~6.5%
  • Revenue Growth (TTM): ~4% | Non-GAAP Operating Margin: ~41%

Growth Profile

Zoom's revenue decelerated from 92% CAGR (FY2020–FY2023 COVID era) to ~3–5% post-normalization. The financial profile is outstanding — 41% non-GAAP operating margins, $1.5B+ FCF, $7.7B net cash — but the growth rate disappointment has kept the stock rangebound at $65–$85 vs. its 2020 peak of $550+. The re-acceleration thesis requires AI Companion monetization to drive enterprise upsell and enterprise seat growth to accelerate from ~7% to double digits.

Forward Estimates

  • FY2026 guidance: Revenue $4.785–4.795B (~3% growth); non-GAAP EPS ~$5.75–5.80
  • Q2 FY2026: Revenue $1.217B (+4.7%) — fastest acceleration in ~3 years; enterprise +7%
  • AI Companion Custom: Launched July 2025; paid add-on for enterprise; early monetization
  • Buyback: $1B program; stock at ~$75 is attractive relative to $7.7B cash + $2B Anthropic stake
  • Anthropic stake: Could be worth $3–5B+ as Anthropic raises at higher valuations

Deeper Financial Analysis

The fundamental tier adds 9 additional research dimensions for $ZM.

Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
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Markdown: /stocks/zm/financials/md · → thesis · → memo