Zoom was given an annual revenue goal of $10bn at Zoom Perspectives this year.
Chief Financial Officer of Zoom, Kelly Steckelberg announced the new ambition at the Zoom analysts conference, according to Zeus Kerravala, Founder and Principal Analyst at ZK Research.
Last month, Zoom forecast its annual revenue at $4.4 billion, down from its previous estimate of around 4.55 billion.
In a video interview with UC Today (above) Kerravala explained: “Kelly did reiterate the fact that Zoom wants to be a $10 billion company.
“Eric sort of joked, sort of joked, that maybe it should be $15 billion.
“If you look at SaaS companies, there have only been four companies that have actually managed to achieve that, Microsoft, Oracle, SAP and Salesforce. The question is can Zoom actually be a $10 billion company?”
The analyst, Kerravala, believes their ambition is admirable, but the attainability of this new revenue target would require the company to more than double its current revenue.
Zoom’s CEO, Eric Yuan, said at the conference that creating a further $4bn in revenue is harder than the reaching the first $4bn milestone.
Not only that, as Kerravala points out, there are only four SaaS (software as a service) companies, which have an annual revenue exceeding $10bn.
Nevertheless, Zoom has got a secret weapon which help it to turn this dream into a reality, which is its popularity.
Zoom is popular within the user community. When Zoom has released products in the past, like Zoom Phone or its contact centre, the community has been happy to give them a chance and the same is probably true going forwards as well.
Essentially, people like Zoom and that willingness, or even eagerness, to try out Zoom’s products is a rare advantage in the business world. Of course, that is far from the complete solution. The deciding factor for any major growth plans at Zoom will need to be backed up by quality features and capabilities.
Kerravala believes if they can deliver on these features and capabilities, the company has got a “legitimate shot” of hitting $10bn per year.
Aside from the product, Zoom will encounter growing obstacles along the way, Kerravala explains: “It is harder to expand it to more areas as you become a bigger company.
“If they continue to grow Zoom apps, there is a lot to do there from a testing perspective.
“You have to roll out low code/no code to appeal to different people. You have got to enable developers to self-service.
“Five hundred app partners are one thing. Five thousand or fifty thousand are a whole different thing.”
Zoom will also need to contend with its most recent quarterly results which Steckelberg, in her own words, described as “disappointing”, after missing the low end of its guidance by $16 million. Disappointing would appear to be an understatement given her lofty ambitions for the company.
What is Zoom doing to reach $10bn?
The full road map will only be known by the inner sanctum at Zoom, but their recent actions have provided us with a considerable insight into the direction they are taking.
Zoom has already made some big announcements so far this year. Zoom Phone celebrated three million users worldwide in July, Zoom Workspace Reservation was launched, a new scalable ‘Zoom One’ package was released, the launch of Zoom Ventures, and more. There are some major successes here which are evidence of the company working on delivering new features.
That much will probably not come as much of a surprise, however. All would remain somewhat shrouded, however, if it weren’t for the company’s recent revamping of Zoom Chat.
Earlier this month, Zoom Chat changed its name to Zoom Team Chat and added a bunch of new features, alongside campaign to showcase Zoom’s wider capabilities beyond video conferencing.
What Zoom has realised is that to beat the competition and to start seriously growing, it needs a major rebranding. It needs people to see Zoom as much more than just a video conferencing platform. The company has been stuck in that box since the pandemic but it no longer serves the company to be over-identified with video calling alone.
Some would argue that Zoom has chat capabilities which can actually rival the like of Slack, but the problem is no one knows about it.
Soon after this, Zoom released calendar and email tools, stepping on the toes of Google and Microsoft. Doing proved yet again, that Zoom is serious about expanding its image and its catalogue of features because only by getting out of the video conferencing box it has put itself in does it stand a chance of reaching its $10bn revenue target.
