Founded in 2011 by Eric Yuan, Zoom Video Communications has proven itself to be worthy of claiming the rising star status, due to its triumphs in the COVID-19 pandemic and beyond.
Zoom Video Communications or more popularly known as “Zoom” had a phenomenal success during the global COVID-19 pandemic surge since the beginning of 2020. The American video conference-focused company provides an online chat & telephony services through a cloud-based peer-to-peer software program. With the surge of COVID-19, business still needed to be done and meetings to be held, which is why Zoom has been a tremendous success during this time as their services were used for personal meetings, education lectures and classes, business and government personnel meetings, among more.
Originally named Saasbee, Zoom launched its video conferencing beta version in September of 2012, which can host at the time up to 15 video participants, welcoming Stanford University as their first customer. Their service was officially launched in early 2013, and had over 3 million users by September 2013.
After enhancing the features of their services, and establishing more B2B partnerships with leaders including Logitech & Qualcomm, in order to secure more funding, the company was valued at $1 billion by January 2017, making it a so-called unicorn. On April 18thof 2019, the company became a publicly-traded stock via an initial public offering, pricing at $36 per share, which increased over 72% on its first day of trading.
The Rising Star
During the pandemic, the software company saw a major increase in remote work, distance education and online social relations. Just in February of 2020, Zoom had gained 2.22 million new users, which is more than the entirety of new users in 2019. Their success in the past two years rocketed its share price by over 450% as of mid-August 2021.
Since last year, the firm’s stock price has jumped over 30%, recording a total revenue for of $2.6 billion, which is up 317% year-over-year. Zoom was one of the fastest growing apps of the pandemic, and their meeting participants increased by 2900 percent during the coronavirus era.
Technical View
When viewing the Zoom (ZM) stock from a technical perspective, it can be noticed that Zoom is an average performer compared to industry peers. The stock price is steady in the medium and long term, but its short-term price movements are more on the negative side. The stock is trading between the 352 to 355 support levels and the 370 to 376 resistance levels, exhibiting a reduced volatility and increasing price consolidation. Overall, the company is an average performer compared to its peers, outperforming 60% of 287 stocks in the same industry.
Challenges Facing the Conference King
- Privacy Issues Continue to Loom on Zoom:The software giant is being regularly accused of data collection issues, specifically regarding consumer consent, such as video recordings, call transcripts, message & file content among more.
- Security Concerns could Sway the Community Away: The Zoom community is concerned about several security issues, such as the ability of call hosts to monitor activity of call attendees, as well as their IP address, OS information and location data.
- Fiercely Competitive Market: Zoom competes with powerful, global brands such as Microsoft, Google & Cisco in the video conferencing playfield.
Zoom is facing several challenges, which could heavily affect its future success outlook and expectations should they loom any bigger. Despite that, the company attracts multiple audiences from different fields of life, such as that in education, business and government. Their easy, reliable and innovative communications platform provides many services across desktops, mobile phones and conference room systems, which proved to be of vital significance during the COVID-19 pandemic. No wonder why this recent phenomenon of a company is currently the 147thmost valuable company in the world, with a market capitalization of over $105 billion as of August 2021.
Sources: The Success Elite – Yahoo! Finance – Forbes – Business of Apps – News 18 – Zoom.us – MetaTrader 5 Platform.
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