Zoom Soars 15% Following Q1 Beat, $1B Buyback and $118 Price Target
Zoom Communications beat Q1 revenue and adjusted EPS estimates, delivering $1.24B revenue (up 5.5% YoY) and $1.55 adjusted earnings while authorizing a $1B share buyback. Jefferies raised its target to $118 from $105 with a Buy rating, and KeyBanc upgraded to Sector Weight, citing margin expansion and AI momentum.
1. Q1 Results and Guidance Raise
Zoom reported Q1 revenue of $1.24 billion, a 5.5% year-over-year increase, with adjusted earnings of $1.55 per share. The company raised its full-year outlook to $5.96–$6.00 in adjusted EPS on $5.08–$5.09 billion revenue, reflecting confidence in sustained growth.
2. Share Buyback Authorization
The board authorized a $1 billion share repurchase program to be executed over the coming months, aiming to enhance shareholder value and leverage the stock's trading levels.
3. Analyst Upgrades Boost Target
Jefferies raised its price target to $118 from $105 and maintained a Buy rating, citing accelerating AI momentum and margin expansion. KeyBanc upgraded to Sector Weight, highlighting stronger execution, improved margins and strategic AI investments with Anthropic.