Stock Track | Zoom Plunges 5.54% in Pre-Market on Earnings Miss, Weak Profit Outlook and Price Target Cut

Stock Track
Feb 26

Zoom Communications Inc. (ZM) experienced a significant pre-market plunge of 5.54% on Thursday, extending losses from the previous trading session.

The decline follows the video conferencing company's release of fourth-quarter financial results, which showed adjusted earnings per share of $1.44, missing analyst estimates of $1.49. While revenue of $1.25 billion exceeded expectations, investors focused on the profit shortfall.

Adding to the negative sentiment, Zoom forecast first-quarter adjusted earnings between $1.40 and $1.42 per share, which falls below Wall Street's estimate of $1.45. The company faces intense competition from rivals such as Microsoft Teams and Google Meet, and is grappling with slowing growth as pandemic-era work-from-home arrangements decline. Analyst firm Bernstein also cut its price target on Zoom to $88 from $90, contributing to the pre-market sell-off.

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