Zoom Raises FY2027 Outlook to $5.08–5.09B After 184% AI User Growth
Zoom’s Q1 revenue rose 5.5% to $1.24 billion with non-GAAP EPS of $1.55 and $500 million in free cash flow. Paid AI users surged 184% year-over-year, prompting management to boost FY2027 revenue guidance to $5.08–5.09 billion and authorize a $1 billion share buyback.
1. Strong Q1 Financial Results
Zoom delivered Q1 revenue of $1.24 billion, up 5.5% year-over-year, with non-GAAP EPS of $1.55. The company generated $522 million in operating cash flow, $500 million in free cash flow, and ended the quarter with $7.7 billion in cash, cash equivalents, and marketable securities.
2. AI Adoption and Enterprise Wins
Paid AI monthly active users grew 184% year-over-year and My Notes surpassed 1.5 million users. AI features featured in nine of the top ten Customer Experience deals and 15 of the top 20 wins, including a seven-figure ARR contract that displaced Teams and Cisco calling, underlining strong enterprise interest.
3. Updated FY2027 Guidance and Capital Return
Management raised full-year FY2027 revenue guidance to $5.08–5.09 billion and lifted non-GAAP EPS targets to $5.96–6.00, while maintaining free cash flow expectations of $1.7–1.74 billion. The board also authorized an additional $1 billion share repurchase to augment its capital return program.
4. Risks and Outlook
Management noted online churn ticked up to 3% from 2.8% and billing variability remains a challenge. Competition in customer experience solutions and awareness of Zoom’s system-of-action positioning were flagged as potential headwinds going forward.