As video conferencing stocks’ Q3 earnings season wraps, let's dig into this quarter's best and worst performers, including Zoom Video (NASDAQ:ZM) and its peers.
Work is becoming more distributed, both across geographies and devices. In order for businesses to keep functioning efficiently, they need to be able to communicate as well as they did when the teams were co-located, which drives the demand for integrated communication platforms.
The 4 video conferencing stocks we track reported a weaker Q3; on average, revenues beat analyst consensus estimates by 0.76%, while on average next quarter revenue guidance was 3% under consensus. Investors abandoned cash burning companies since high interest rates will make it harder to raise capital, but video conferencing stocks held their ground better than others, with the share prices up 23.8% since the previous earnings results, on average.
Weakest Q3: Zoom Video (NASDAQ:ZM)
Started by Eric Yuan who once ran engineering for Cisco’s video conferencing business, Zoom (NASDAQ:ZM) offers an easy to use, cloud-based platform for video conferencing, audio conferencing and screen sharing.
Zoom Video reported revenues of $1.1 billion, up 4.86% year on year, in line with analyst expectations. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and slow revenue growth.
“At Zoomtopia, we announced a number of innovations including Zoom Mail and Zoom Calendar, along with new partnerships that are expected to power and enhance the modern work experience,” said Eric S. Yuan, Zoom founder, and CEO.
Zoom Video scored the highest full year guidance raise but had the weakest performance against analyst estimates and weakest performance against analyst estimates of the whole group. The company added 170 enterprise customers paying more than $100,000 annually to a total of 3,286. The stock is down 12.7% since the results and currently trades at $70.
Read our full report on Zoom Video here, it's free.
Best Q3: 8x8 (NYSE:EGHT)
Founded in 1987, 8x8 (NYSE:EGHT) provides software for organizations to efficiently communicate and collaborate with their customers, employees, and partners.
8x8 reported revenues of $187.3 million, up 23.6% year on year, in line with analyst expectations. It was a mixed quarter for the company, with accelerating growth in large customers but underwhelming revenue guidance for the next quarter.
The stock is up 29% since the results and currently trades at $4.38.
Is now the time to buy 8x8? Access our full analysis of the earnings results here, it's free.
Five9 (NASDAQ:FIVN)
Started in 2001, Five9 (NASDAQ: FIVN) offers software as a service that makes it easier for companies to set up and efficiently run call centers, and offer more tailored customer support.
Five9 reported revenues of $198.3 million, up 28.5% year on year, beating analyst expectations by 1.35%. It was a weak quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.
Five9 pulled off the strongest analyst estimates beat and fastest revenue growth, but had the weakest full year guidance update in the group. The stock is up 50.9% since the results and currently trades at $70.95.
Read our full analysis of Five9's results here.
RingCentral (NYSE:RNG)
Founded in 1999 during the dot-com era, RingCentral (NYSE:RNG) provides software as a service that unifies phone, text, fax, video calls and chat in one platform.
RingCentral reported revenues of $509 million, up 22.7% year on year, beating analyst expectations by 1.28%. It was a weak quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.
The stock is up 28.3% since the results and currently trades at $36.35.
Read our full, actionable report on RingCentral here, it's free.
The author has no position in any of the stocks mentioned