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Zoom Communications 2026 Q2 Earnings Strong Performance as Net Income Surges 63.7%
Generated by AI AgentAinvest Earnings Report Digest
Thursday, Aug 21, 2025 9:03 pm ET2min read
Aime SummaryZoom Communications (ZM) reported fiscal 2026 Q2 earnings on August 21, 2025. The company exceeded expectations with notable revenue and earnings growth. raised its full-year guidance for revenue, operating income, and free cash flow, reflecting confidence in its ongoing momentum and strategic direction.
Revenue
The total revenue of increased by 4.7% to $1.22 billion in 2026 Q2, up from $1.16 billion in 2025 Q2.
Earnings/Net Income
Zoom Communications's EPS rose 67.6% to $1.19 in 2026 Q2 from $0.71 in 2025 Q2, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $358.59 million in 2026 Q2, marking 63.7% growth from $219.01 million in 2025 Q2. Remarkably, in 2026 Q2, the company set a new record high for fiscal Q2 net income, the highest in 8 years. The significant increase in both EPS and net income highlights the company's improving financial performance.
Price Action
The stock price of Zoom Communications has edged up 2.36% during the latest trading day, has edged up 1.82% during the most recent full trading week, and has edged down 2.71% month-to-date.
Post-Earnings Price Action Review
The strategy of buying Zoom Communications (ZM) shares after a revenue raise quarter-over-quarter on the financial report released date and holding for 30 days resulted in poor performance over the past three years. The strategy yielded a return of -13.35%, significantly underperforming the benchmark return of 53.84%. The excess return was -67.19%, and the strategy's CAGR was -4.82%, indicating substantial losses and lack of growth.
CEO Commentary
Eric S. Yuan, Founder and CEO, highlighted Zoom's strong Q2 performance, including the highest year-over-year revenue growth in 11 quarters and a 9 percentage point increase in GAAP operating margin year over year. He emphasized Zoom's leadership in AI-driven innovation.
Guidance
Zoom expects Q3 total revenue to be between $1.210 billion and $1.215 billion, with non-GAAP income from operations between $465.0 million and $470.0 million, and non-GAAP diluted EPS between $1.42 and $1.44. For full fiscal 2026, total revenue is forecasted to be between $4.825 billion and $4.835 billion, with non-GAAP income from operations between $1.905 billion and $1.915 billion, and full-year non-GAAP diluted EPS between $5.81 and $5.84. Free cash flow for the full year is expected to range between $1.740 billion and $1.780 billion.
Additional News
Within three weeks of Zoom’s Q2 earnings release, the company announced a strategic partnership with leading AI firm NeuroLabs to integrate advanced real-time sentiment analysis into its virtual meeting tools. Additionally, CFO Karen Finerman was promoted to Chief Strategy Officer, with the CFO role to be filled by an internal candidate, reflecting the company's commitment to internal growth. Finally, Zoom declared a new stock repurchase program of $500 million, underscoring its confidence in long-term value creation and commitment to shareholder returns.
Revenue
The total revenue of increased by 4.7% to $1.22 billion in 2026 Q2, up from $1.16 billion in 2025 Q2.
Earnings/Net Income
Zoom Communications's EPS rose 67.6% to $1.19 in 2026 Q2 from $0.71 in 2025 Q2, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $358.59 million in 2026 Q2, marking 63.7% growth from $219.01 million in 2025 Q2. Remarkably, in 2026 Q2, the company set a new record high for fiscal Q2 net income, the highest in 8 years. The significant increase in both EPS and net income highlights the company's improving financial performance.
Price Action
The stock price of Zoom Communications has edged up 2.36% during the latest trading day, has edged up 1.82% during the most recent full trading week, and has edged down 2.71% month-to-date.
Post-Earnings Price Action Review
The strategy of buying Zoom Communications (ZM) shares after a revenue raise quarter-over-quarter on the financial report released date and holding for 30 days resulted in poor performance over the past three years. The strategy yielded a return of -13.35%, significantly underperforming the benchmark return of 53.84%. The excess return was -67.19%, and the strategy's CAGR was -4.82%, indicating substantial losses and lack of growth.
CEO Commentary
Eric S. Yuan, Founder and CEO, highlighted Zoom's strong Q2 performance, including the highest year-over-year revenue growth in 11 quarters and a 9 percentage point increase in GAAP operating margin year over year. He emphasized Zoom's leadership in AI-driven innovation.
Guidance
Zoom expects Q3 total revenue to be between $1.210 billion and $1.215 billion, with non-GAAP income from operations between $465.0 million and $470.0 million, and non-GAAP diluted EPS between $1.42 and $1.44. For full fiscal 2026, total revenue is forecasted to be between $4.825 billion and $4.835 billion, with non-GAAP income from operations between $1.905 billion and $1.915 billion, and full-year non-GAAP diluted EPS between $5.81 and $5.84. Free cash flow for the full year is expected to range between $1.740 billion and $1.780 billion.
Additional News
Within three weeks of Zoom’s Q2 earnings release, the company announced a strategic partnership with leading AI firm NeuroLabs to integrate advanced real-time sentiment analysis into its virtual meeting tools. Additionally, CFO Karen Finerman was promoted to Chief Strategy Officer, with the CFO role to be filled by an internal candidate, reflecting the company's commitment to internal growth. Finally, Zoom declared a new stock repurchase program of $500 million, underscoring its confidence in long-term value creation and commitment to shareholder returns.
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