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Zoom Video Communications Gross Margin %

: 74.42% (As of Jul. 2021)
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Gross Margin % is calculated as gross profit divided by its revenue. Zoom Video Communications's Gross Profit for the three months ended in Jul. 2021 was $760 Mil. Zoom Video Communications's Revenue for the three months ended in Jul. 2021 was $1,021 Mil. Therefore, Zoom Video Communications's Gross Margin % for the quarter that ended in Jul. 2021 was 74.42%.


The historical rank and industry rank for Zoom Video Communications's Gross Margin % or its related term are showing as below:

NAS:ZM' s Gross Margin % Range Over the Past 10 Years
Min: 69   Med: 79.68   Max: 81.54
Current: 71.07

69
81.54

During the past 5 years, the highest Gross Margin % of Zoom Video Communications was 81.54%. The lowest was 69.00%. And the median was 79.68%.

NAS:ZM's Gross Margin % is ranked higher than
94% of the 525 Companies
in the Software industry.

( Industry Median: 60.80 vs. NAS:ZM: 71.07 )

Zoom Video Communications had a gross margin of 74.42% for the quarter that ended in Jul. 2021 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Zoom Video Communications was 0.00% per year.


Zoom Video Communications Gross Margin % Historical Data

The historical data trend for Zoom Video Communications's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Zoom Video Communications Annual Data
Trend Jan17 Jan18 Jan19 Jan20 Jan21
Gross Margin %
79.49 79.68 81.54 81.47 69.00

Zoom Video Communications Quarterly Data
Jan17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 71.02 66.71 69.71 72.29 74.42

Competitive Comparison

For the Software - Application subindustry, Zoom Video Communications's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Zoom Video Communications Gross Margin % Distribution

For the Software industry and Technology sector, Zoom Video Communications's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Zoom Video Communications's Gross Margin % falls into.



Zoom Video Communications Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

Zoom Video Communications's Gross Margin for the fiscal year that ended in Jan. 2021 is calculated as

Gross Margin % (A: Jan. 2021 )=Gross Profit (A: Jan. 2021 ) / Revenue (A: Jan. 2021 )
=1829.4 / 2651.368
=(Revenue - Cost of Goods Sold) / Revenue
=(2651.368 - 821.989) / 2651.368
=69.00 %

Zoom Video Communications's Gross Margin for the quarter that ended in Jul. 2021 is calculated as


Gross Margin % (Q: Jul. 2021 )=Gross Profit (Q: Jul. 2021 ) / Revenue (Q: Jul. 2021 )
=760.2 / 1021.495
=(Revenue - Cost of Goods Sold) / Revenue
=(1021.495 - 261.256) / 1021.495
=74.42 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.


Zoom Video Communications  (NAS:ZM) Gross Margin % Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

Zoom Video Communications had a gross margin of 74.42% for the quarter that ended in Jul. 2021 => Durable competitive advantage


Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.


Zoom Video Communications Gross Margin % Related Terms

Thank you for viewing the detailed overview of Zoom Video Communications's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.


Zoom Video Communications Business Description

Zoom Video Communications logo
Industry
Technology » Software NAICS : 511210 SIC : 7372
Traded in Other Exchanges
Address
55 Almaden Boulevard, 6th Floor, San Jose, CA, USA, 95113
Zoom Video Communications provides a communications platform that connects people through video, voice, chat, and content sharing. The company's cloud-native platform enables face-to-face video and connects users across various devices and locations in a single meeting. Zoom, which was founded in 2011 and is headquartered in San Jose, California, serves companies of all sizes from all industries around the world.
Executives
Bawa Aparna officer: Chief Operating Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Pelosi Janine officer: Chief Marketing Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Hammonds Kimberly director 100 EAST DAVIE STREET RALEIGH NC 27601
Crehan Shane officer: Chief Accounting Officer C/O EVENTBRITE, INC. 155 5TH STREET, 7TH FLOOR SAN FRANCISCO CA 94103
Yuan Eric S. director, 10 percent owner, officer: Chief Executive Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Mcmaster Herbert Raymond director C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Steckelberg Kelly officer: Chief Financial Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Gassner Peter P director C/O VEEVA SYSTEMS INC. 4280 HACIENDA DRIVE PLEASANTON CA 94588
Chadwick Jonathan director 3401 HILLVIEW AVENUE PALO ALTO CA 94304
Azus Ryan officer: Chief Revenue Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Swanson Bart director C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Benhorin Roy officer: Chief Accounting Officer C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Sankarlingam Velchamy officer: Pres. of Engineering & Product C/O ZOOM VIDEO COMMUNICATIONS, INC. 55 ALMADEN BOULEVARD, 6TH FLOOR SAN JOSE CA 95113
Subotovsky Santiago director C/O EMERGENCE CAPITAL PARTNERS 160 BOVENT ROAD SUITE 300 SAN MATEO CA 94402
Emergence Equity Partners Iii, L.p. 10 percent owner 160 BOVET ROAD, SUITE 300 SAN MATEO CA 94402

Zoom Video Communications Headlines

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