Zoom surges after beating estimates and raising forecasts

Zoom is up around 8% in premarket trading after posting earnings Thursday that beat analysts’ expectations and raising its fiscal year guidance.

For its Q1 FY 2027, the video communications platform reported:

• Adjusted earnings per share of $1.55, versus analysts’ $1.42.

• Revenue of $1.24 billion, up 5.5% from a year earlier and above the consensus estimate of $1.22 billion.

• Guidance for 2027 fiscal year revenue of $5.08 ​billion to $5.09 billion, up from its ​earlier forecast of $5.07 billion to $5.08 billion. Zoom now expects annual adjusted ‌EPS to be between $5.96 and $6.00, up from its prior forecast of $5.77 to $5.81.

The company reported strong enterprise sales growth as well as strong demand for its AI products, including AI Companion and My Notes.

The company’s $51 million investment in Anthropic also appears to be paying off. Zoom reported a $152 million gain on strategic investments, which are currently worth $1.9 billion. Last quarter the company disclosed that the “most significant portion” of its strategic investment assets comes from Anthropic, whose valuation has skyrocketed.

Today, Wedbush Securities analyst Dan Ives raised his Zoom price target to $120 from $110, “reflecting greater confidence in the ZM AI story that continues gaining momentum.”

While the stock has increased 20% year to date, it’s still far off its pandemic-era highs.