Home / Business and Economy / Zoom's Profit Forecast Misses Estimates Amid AI Costs
Zoom's Profit Forecast Misses Estimates Amid AI Costs
26 Feb
Summary
- Zoom forecasts fiscal 2027 earnings below analyst expectations.
- Increased costs for AI products impact company's financial outlook.
- The company reported a 5% sales increase for the fiscal fourth quarter.
Zoom Communications Inc. anticipates fiscal year 2027 earnings between $5.77 and $5.81 per share, a forecast that has missed analyst expectations of $6.06 per share. This outlook suggests increased expenses for the company as it actively promotes its expanded product offerings.
The videoconferencing giant has been broadening its services to include corporate phone systems and contact center software, many of which leverage artificial intelligence. The integration of AI technologies, often relying on models from third-party firms, is contributing to higher operational costs.
For the fiscal fourth quarter ending January 31, Zoom reported adjusted profit of $1.44 per share, slightly below the $1.49 average estimate. However, sales for the period saw a 5% increase, reaching $1.25 billion, marginally surpassing Wall Street's projections.
The company's shares experienced a 2% decline in extended trading following the announcement. While the stock has remained largely unchanged year-to-date, contrasting with declines seen by many software peers, the current forecast highlights potential financial challenges ahead.
