ZOOM Video Communications reported quarterly sales and profit that topped analysts’ estimates, a sign that corporate customers are sticking with the software company. The shares gained more than 10 per cent in extended trading.

The company also announced a US$1.5 billion share buyback, which follows a US$1 billion authorisation started in 2022 that expired this month.

Sales gained 2.6 per cent to US$1.15 billion, the company said on Monday (Feb 26). Analysts, on average, projected US$1.13 billion, according to data compiled by Bloomberg. Profit, excluding some items, was US$1.42 a share, compared with the average estimate of US$1.15.

The new buyback is likely to be the biggest area of focus for investors, as it “answers one element of uncertainty” around how Zoom will use its stockpile of cash, Michael Turrin, an analyst at Wells Fargo, said. The move likely pushes back on the potential of a large acquisition, he added.

After hyper-growth during the pandemic, Zoom has experienced a dramatic sales slowdown amid competition for business customers from Microsoft and the departure of consumers from the videoconferencing platform. In the hopes of capturing more corporate clients, Zoom has expanded its product line to include phone systems, call centres and artificial intelligence (AI) assistants.

“Our team is dedicated to platform-wide innovation, introducing hundreds of new features, including those for Zoom Contact Center, which redefine the gold standard for customer experience,” chief executive officer Eric Yuan said.

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Contact centre licenses about tripled over the last year, and 95 phone customers had more than 10,000 active users, Zoom said. About half a million accounts enabled Zoom’s AI free companion, the company added.

Enterprise revenue increased 4.9 per cent to US$667.3 million in the period ended Jan 31. Zoom said it had 220,400 corporate customers at the end of the quarter, with 3,810 contributing more than US$100,000 in trailing 12-month revenue.

Online sales, generally from casual consumers and small business, decreased 0.5 per cent to US$479.2 million. Zoom, on average, lost 3 per cent of those customers each month in the quarter, matching its metric for the previous period, which was the slowest rate of churn the company had ever reported.

Zoom projected revenue of about US$4.6 billion in the fiscal year ending in January 2025. Analysts, on average, estimated US$4.66 billion. Profit, excluding some items, will be US$4.85 to US$4.88 a share, compared with the average projection of US$4.72.

The shares hit a high of US$71.96 in extended trading after closing at US$63.12 in New York. The San Jose, California-based company’s stock has declined 15 per cent over the past 12 months, missing the market rally that fuelled many technology companies. BLOOMBERG