Zoom's (ZM.US) videoconferencing business continues to face challenges as its guidance falls short of expectations.

Zoom(ZM.US) reported its fourth-quarter earnings before the market opened on Tuesday in Beijing time. The data showed that the company's Q4 revenue grew 3.3% year-on-year to $1.18 billion, in line with market expectations; its adjusted EPS was $1.41, topping market expectations of $1.31.

As pandemic restrictions were lifted, many individuals and small businesses stopped using Zoom's video conferencing services, and the average monthly churn rate for the segment was 2.8% in Q4, in line with analysts' expectations.

By contrast, enterprise customers largely retained their video conferencing services. Zoom's enterprise segment revenue grew 5.9% year-on-year to $707.8 million in Q4, topping market expectations. Zoom said the number of customers that contributed more than $100,000 in revenue over the past year was 4,088.

However, Zoom expects its fiscal year ending in January 2026 to generate revenue of about $4.79 billion, with adjusted EPS of $5.34 to $5.37. Analysts on average expect adjusted revenue of $4.81 billion and EPS of $5.37.

The video-conferencing company has been trying to boost its user base by offering more tools, including phone systems, contact center applications and artificial intelligence assistants.

Brad Reback, an analyst at Stifel, said before the earnings release: "The company's core video business still faces challenges, largely due to market saturation and competitive pressure from Microsoft."

Eric Yuan, Zoom's CEO, shared signs of the popularity of the company's new products. He said on the call that the company won twice as many large contact center deals in the current quarter as it did a year ago. Its contact center software handles tasks such as customer support. The number of monthly active users of Zoom's AI companion grew 68% from the previous quarter.

As of the time of writing, Zoom's stock price fell 2% after hours. The stock had risen 28% over the past 12 months before the earnings release.