AI Companion monthly active users have grown over 4x year-over-year, with millions using our AI to boost business value throughout the meeting lifecycle and beyond.
— Eric S. Yuan
03Detailed Report
ZM
Company ZM
Period
Q2 2026
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 5, 2026
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Executive Summary
Zoom delivered a solid QQ2 2026 performance, underscoring the durability of its software-as-a-service model while accelerating AI-enabled differentiation. Total revenue of $1.217 billion rose 4.7% year over year (4.4% in constant currency), with the Enterprise segment accounting for 60% of revenue and continuing to outgrow Online. Non-GAAP gross margin improved to 79.8% (+128 bps YoY), and non-GAAP operating margin expanded to 41.3% (+216 bps), driven by disciplined cost management and the ongoing shift of investments toward AI capabilities. Free cash flow reached $508 million (up 39% YoY) on a 42.4% operating cash flow margin, and the company ended the quarter with a substantial liquidity position (~$7.8 billion in cash, cash equivalents, and marketable securities) while continuing a buyback program totaling $463 million for 6 million shares in the quarter. Management highlighted strong AI momentum, with AI Companion MAUs up more than 4x year-over-year and Enterprise-driven AI workflows expanding across meetings, contact center, and customer experience. Management also signaled a constructive, albeit dynamic, macro backdrop with raised full-year guidance for FY26 and continued emphasis on AI-driven product differentiation and platform cohesion.
Key accelerants include: (1) AI Companion and customized AI capabilities expanding beyond meeting summaries into pre- and post-meeting workflows and cross-product automation; (2) stronger displacement-driven CCaaS growth and high-end AI features under Zoom Contact Center Elite; (3) strategic partnerships (PwC, AWS Marketplace expansion) that broaden go-to-market reach; and (4) sustained profitability and strong FCF supporting a robust capital return program. Investors should monitor the trajectory of AI-related operating costs versus efficiency gains, the rate of enterprise win-rate expansion, the evolution of RPO and deferred revenue, and the pace of AI-driven monetization in targeted SKUs (e.g., Custom AI Companion) amid a competitive AI and collaboration landscape.
Key Performance Indicators
Revenue
Increasing
1.22B
QoQ: 3.62% | YoY: 4.71%
Gross Profit
Increasing
944.06M
77.56% margin
QoQ: 5.33% | YoY: 7.59%
Operating Income
Increasing
321.74M
QoQ: 33.17% | YoY: 58.98%
Net Income
Increasing
358.59M
QoQ: 40.84% | YoY: 63.73%
EPS
Increasing
1.19
QoQ: 42.51% | YoY: 67.61%
Revenue Trend
Margin Analysis
Financial Highlights
- Revenue: $1.217B in Q2 FY '26, up 4.7% YoY; 4.4% in constant currency (YoY and FX performance corroborated by management commentary). In the four-quarter view, revenue YoY growth rates were 4.7% and QoQ growth was 3.62% according to supplemental metrics.
- Gross Profit: $944.062M, gross margin 79.8% (up 128 bps YoY).
- Operating Income: $321.735M; non-GAAP operating income $503M, non-GAAP operating margin 41.3% (up 216 bps YoY).
- Net Income / EPS: Net income $358.592M; non-GAAP diluted EPS $1.53 per share; GAAP EPS not disclosed in the provided figures. Weighted-average shares outstanding ~301.8M (non-GAAP diluted ~308.2M).
- Cash Flow: Operating cash flow $516M (margin 42.4%); free cash flow $508M (margin 41.7%), up 39% YoY.
- Balance Sheet: Cash, cash equivalents, and marketable securities ~ $7.8B; net cash position implied by netDebt of -$1.167B; deferred revenue end period $1.48B; RPO ~$4.0B, with ~61% expected to be recognized as revenue in the next 12 months.
- Share Repurchase: Executed buyback of 6.0M shares for $463M (up from prior quarter); total buybacks under the $2.7B program.
- Guidance: Q3 revenue guidance of $1.21B–$1.215B (~3% YoY at midpoint); non-GAAP operating income guidance $465M–$470M (OPM ~38.6% at midpoint); non-GAAP EPS guidance $1.42–$1.44 (based on ~307M shares). FY26 revenue guidance raised to $4.825B–$4.835B; non-GAAP operating income guidance $1.905B–$1.915B; non-GAAP EPS guidance $5.81–$5.84; free cash flow guidance $1.74B–$1.78B.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
1.22B
4.71%
3.62%
Gross Profit
944.06M
7.59%
5.33%
Operating Income
321.74M
58.98%
33.17%
Net Income
358.59M
63.73%
40.84%
EPS
1.19
67.61%
42.51%
Key Financial Ratios
Management Insights Available for Members
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