The U.S. headquartered video conferencing platform Zoom experienced a surge in its revenue during the COVID-19 outbreak. The company reported a revenue increase of 169% from its previous years amounting to USD 328 million in three months.
With norms of social distancing in place, many people are using Zoom Video for their communication needs. Around 265,400 companies with more than 10 employees each are using this platform for their business meetings. This has led to a 354% increase in its user base from last year. The company’s profit skyrocketed to USD 27 million in comparison to its year-ago quarter profit of USD 0.2 million.
Zoom - A teleconferencing solution provider that started a decade ago as a business communication tool which is now a go-to platform for many people. Today, people are using it to host events and celebrations among their peers. Analysts expect that it will generate a hefty sum of revenue as the platform has become a popular choice among people.
“We are courteous to people all around the globe for adopting Zoom services amid the Coronavirus Pandemic. The crisis has accelerated the need for face-to-face digital communication tools & Zoom is glad to fulfill this need”
- Eric S. Yuan, Founder & Chief Executive Officer of Zoom
The work-from-home culture has helped in boosting the growth of this platform. We have also experienced a booming rise in free customers on our platform. As of June 2020, Zoom allows an uninterrupted 40 minutes long video call to its free customers before it asks them to pay.
Zoom is expected to gain revenues of around USD 905 - 915 million in this year. Though the company’s business skyrocketed in the last few months it has attracted much-unwanted attention as well. A host of security and privacy issues on the platform has made headlines in the press. The controversies surrounding Zoombombing - where trolls break in meetings and share profanatory content. Following this many NewYork city and Singapore schools have temporarily banned this service.
In response, Zoom quickly fixed the security issues and turned to engineer expertise to construct an end-to-end encryption mode. On these issues, Mr. Yuan responded stating, “We opened our platform for everyone during this crisis with good intentions. However, a large number of first-time users who did not have full IT support or protocols for privacy suffered some issues. We have transparently addressed these issues and made a 90-days plan initiative with a weekly webinar where customers can ask me anything.”
Zoom is also facing large competition from tech giants like Facebook and Google. The video conferencing business is expected a growth of $50 billion till 2026 and these companies are racing to have a larger share in the market.
The performance of Zoom looks very impressive till now. But with restrictions getting upheld in the lockdown, will the company be able to retain its business growth or not is a big question.