Zoom stock has been crashing since mid-pandemic when some investors realized that pandemic lockdowns wouldn’t last forever. Now results are showing the strain of reopening on Zoom’s business. Dan Gallagher reports in The Wall Street Journal:

Many businesses are still recovering from the pandemic. For Zoom Video Communications, recovery from being a pandemic darling is proving equally difficult.

Fiscal second-quarter results late Monday from Zoom were the toughest yet for the videoconferencing provider. Revenue for the quarter ended July 31 rose only 8% year over year to about $1.1 billion.

That was about 2% below the midpoint of the company’s guidance range and missed Wall Street’s consensus forecast for the first time since Zoom went public in 2019. It also marked the first instance of single-digit growth on record for the company that brought videoconferencing to the homebound masses; Zoom has averaged 176% year-over-year growth over the previous eight quarters.

Zoom’s revenue forecast for the current quarter was also about 4% below analysts’ targets. In addition, the company trimmed its previous outlook for the full fiscal year ending in January, citing a mix of unfavorable exchange rates, weakness in its online business segment that serves consumers and small businesses, and a more typical pattern of closing sales deals for its enterprise side in the back half of the fiscal year. Zoom’s shares slid more than 16% Tuesday—the stock’s worst single-day decline since its July quarter results disappointed investors a year ago.

Zoom has been working its way out of the pandemic’s shadow for some time now. Revenue growth has steadily decelerated since early 2021, mostly as a result of rapidly cooling demand from consumers who hopped onto the platform when lockdowns began in earnest the year before. The pandemic rapidly remade Zoom’s business; the consumer segment went from being one-third the size of the enterprise side to 38% larger in just two quarters.

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