The video platform saw its profits fall heavily last year, but appears to be holding steady thanks to its focus on AI features this year.
Zoom has improved its outlook for the rest of 2023, thanks to a steady quarter that saw the company’s revenue and profits rise.
The company’s total revenue for the third quarter was $1.136bn, an increase of 3.2pc compared to the same period last year. Net income for the latest quarter was more than $141m, a leap from the $48.3m it earned in the same period of 2022.
Zoom has been updating its AI services this year, joining various other tech companies that have focused on the rising technology. While Zoom has had some AI-powered features for a while now, it partnered with ChatGPT-creator OpenAI earlier this year to upgrade its AI capabilities with Zoom IQ, an assistant that can simplify a range of tasks on the platform.
Zoom founder and CEO Eric Yuan said the company’s revenue came in “ahead of guidance”. He attributed the boosted revenue to enhanced customer and employee engagement solutions, along with the new capabilities the company has added such as its Zoom AI Companion.
“We are also pleased with our online business where we drove higher retention and saw usage of our new AI capabilities enhancing the value of our platform,” Yuan said.
Zoom updated its terms of service in March when it revealed its new AI features in partnership with OpenAI. One section in these terms stated that customers granted Zoom a licence to “display, copy, distribute, translate, transcribe, create derivative works and process customer content”.
In response to the backlash, Zoom added a line to this section in August to make it clear that this is an option that customers can consent to.
The video platform had a rapid rise during the Covid-19 pandemic, as many organisations moved to remote working. Zoom said its staff numbers swelled by 300pc within 24 months to meet the rapid demand.
But the company’s profits waned last year as growth slowed and rival services continue to emerge. In July 2022, Marketwatch reported that Zoom’s shares dropped by more than 80pc from their peak in 2020.
In February of this year, Yuan announced a “tough but necessary decision” to reduce the company workforce by 15pc in order to help handle uncertainties in the economy.
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