Shares dropped 10.5% after Zoom’s Q2 report as investors reacted negatively to signs of deceleration and a cautious outlook despite continued AI-driven momentum. The stock move reflects underlying concerns about overall growth slowing and margin pressure, overshadowing gains in certain segments.
- Total revenue grew 4.9%, with Enterprise revenue accelerating modestly at 7.8%, marking the strongest pace in three years but still reflecting deceleration from prior quarters.
- AI-driven features saw strong adoption, with licensed monthly active users of AI features in Workplace increasing 125% year-over-year.
- Zoom Contact Center (CX) ARR maintained high double-digit growth, fueled by AI integration and record numbers of seven-figure ARR deals.
- Key customer expansions included large enterprises upgrading Zoom Workplace and Zoom Phone, consolidating vendors and integrating platforms.
- Despite segment-level progress, investors likely disappointed by cautious management outlook and the absence of clear margin expansion or broader platform growth acceleration consistent with earlier periods.
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