>
Switch to:

Zoom Video Communications Financial Strength

: 8 (As of Oct. 2021)
View and export this data going back to 2019. Start your Free Trial

Zoom Video Communications has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.

Good Sign:

Zoom Video Communications Inc shows strong financial strength.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Zoom Video Communications's Interest Coverage for the quarter that ended in Oct. 2021 was 97.11. Zoom Video Communications's debt to revenue ratio for the quarter that ended in Oct. 2021 was 0.02. As of today, Zoom Video Communications's Altman Z-Score is 20.60.


Competitive Comparison

For the Software - Application subindustry, Zoom Video Communications's Financial Strength, along with its competitors' market caps and Financial Strength 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 Financial Strength Distribution

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

* The bar in red indicates where Zoom Video Communications's Financial Strength falls into.



Zoom Video Communications Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Zoom Video Communications's Interest Expense for the months ended in Oct. 2021 was $-3 Mil. Its Operating Income for the months ended in Oct. 2021 was $291 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Oct. 2021 was $79 Mil.

Zoom Video Communications's Interest Coverage for the quarter that ended in Oct. 2021 is

Interest Coverage=-1*Operating Income (Q: Oct. 2021 )/Interest Expense (Q: Oct. 2021 )
=-1*290.857/-2.995
=97.11

The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies interest coverage is at least 5. Zoom Video Communications Inc has enough cash to cover all of its debt. Its financial situation is stable.

2. Debt to revenue ratio. The lower, the better.

Zoom Video Communications's Debt to Revenue Ratio for the quarter that ended in Oct. 2021 is

Debt to Revenue Ratio=Total Debt (Q: Oct. 2021 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(18.074 + 79.319) / 4203.024
=0.02

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Zoom Video Communications has a Z-score of 20.60, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 20.6 is strong.

* 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.


Zoom Video Communications  (NAS:ZM) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Zoom Video Communications has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.


Zoom Video Communications Financial Strength Related Terms

Thank you for viewing the detailed overview of Zoom Video Communications's Financial Strength 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

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)