Zoom Video: A Modern Solution for Instant Messaging, Phone Calls, Conferencing, and Business Meetings

Introduction

Zoom video is one of the leading one-stop for instant messaging, phone calls, conferencing, webinars, and business meetings. The company provides messaging and video conferencing across devices. The Zoom Chat and Zoom phone offerings provide a streamlined user experience to make an easy collaboration and modernize the interaction among workers. Since the company was founded in 2011, Zoom video has yielded an approximate amount of $ 161 million of funding before the IPO (Lam 447). The company was backed by most of the capital organizations such as Horizon Ventures, Emergence, and Sequoia capital.

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In April 2019, Zoom Video rose up in public, making the company provide more than 20 million shares at $36 per share, which contributed to about $ 752. Within shorter months, the zoom Company's stock rose to above $ 100. Although investors may be concerned about the valuation of the company, the latest sales are a driving factor. Today, Zoom growth metrics and fundamentals remain to be steadfast and strong. In 2020, in the first quarter, the company registered sales of about $ 146 million, which was estimated to rise to about 96% at the end of the year. In the last July quarter, the revenue yielded exceeding Zoom's own guidance and increased cash flow and profitability.

SWOT Analysis

Strength

One of the strengths of the company is winning a major contract with HSBC. In essence, the contract seeks to standardize business operation on the company platform while deploying a solution to more than 5500 conference rooms. For instance, the HSBC consolidates the company's video-first communication media for external and internal meetings.

The other strength is a partnership with Verizon Business Group. Ideally, the partnership with Verizon is a driving factor to gain global service providers who work to spread the company's products across the globe. By making the service available on Verizon's website, the company sales team can reach many customers more safely.

The architecture of the company of video first is one of the key strengths. The architecture is optimized and cloud-native, which delivers high-quality and reliable video and dynamically processes them across devices. Zoom meetings are strength as they provide a feature design of frictionless communication experience and a full suite of products to the user.

Weaknesses

The company experiences dynamic changes in workforce demographics. If the demographics continue to shift, the company is more likely to have a distributed workforce, which is difficult to communicate to and managed. The company need to retain its workforce to allow them to meet their work and need

The company's workers are currently influencing IT decisions. Zoom encourages the modernization of IT to bring current technologies which are altered by the employees to meet their personal requirements (Border et al. 56). Although the company expects employees to communicate seamlessly across media, they are in a better position of influencing the IT decisions.

The other weakness is that the company has failed to establish a deeper engagement between partners, customers, and employees. In essence, people become more productive and satisfied when they are engaged in external and internal business relationships. The company lacks a reliable business solution that can be applied to operate videos in various work stations.

Opportunities

The existence of a native cloud platform allows the company to deliver high-quality, reliable, and easy to manage videos. The company has provided an advanced platform for communication where it can build a substantial trust with the customers and create greater intimacy and effectiveness in human-to-human conversation over a longer distance.

Threats

One of the major threats to the company is the competition fueled by Cisco WebEx. The competitors may produce a counterfeit video that is not required by the users.

Financial Analysis

The company has a unique model that combines viral enthusiasm for its platform to provide optimal efficiency. The enthusiasm commences with the customers, especially when they visit the company platform.

The company believes in having established a sustainable and scalable business model. The sales model of the company allows it to turn a single non-paying customer into a full enterprise deployment. In the 2019 fiscal year, the January report, 55% of the company's 344 customers contributed about $ 100000 of the revenue, which began with one free host before subscribing. On January 31, 2019, the 344 customers produced about 30% of the revenue.

The primary capital raised by the company in recent years is recorded on the balance sheet to demonstrate the positive cash flow of operation. The company's revenue was recorded to be 60.8% million in 2017 ("S-1/A"). At the end of January 31, 2018, the revenue was reported to have accumulated to $ 151.5 million. At the end of January 31, 2019, the revenue was about $ 330.5 million. The values represented growth in revenue of 149% and 118% in 2018 and 2019, respectively. The company experienced a net loss of $ 0.0 million in the fiscal year, 2017, and a net loss of $ 3.8 million in 2018. In the fiscal year that ended on January 31, 2019, the net income was estimated to be $ 7.6 million. Cash provided for operation increased as follows$ 51.3 million, $ 19.4 million, and $ 9.4 million in 2019, 2018, and 2017.

Works Cited

"S-1/A." SEC.gov, www.sec.gov/Archives/edgar/data/1585521/000119312519107178/d642624ds1a.htm.

Border, John N., and Joseph R. Bietry. "Zoom by multiple image capture." U.S. Patent No. 8,134,589. 13 Mar. 2012.

Lam, Yin Zin Mark. "Single Point Input Variable Zoom." U.S. Patent Application No. 12/795,447.