Zoom announced its quarterly results for Q1 of the fiscal year 2023 (FY 2023), and the results confirmed that its “land and expand strategy” is working. The company’s revenue rose 12.3% year over year (YoY) to $1.07 billion. It also reported two-quarters of sequential growth for its gross margin, which management attributed to optimizing usage across the public cloud and increasing the number of co-located data centers.
This week, network vendor and technology leader Cisco announced its Q3 FY22 earnings results. The company posted revenues of $12.8B, missing consensus estimates by over $500M.
Revenue was essentially flat (+0.3%) year over year. Cisco reported non-GAAP EPS of $0.87, topping the street by a penny. Total gross margin was 65.7%, which was at the high end of Cisco’s guidance.
Most enterprises today have some type of multi-cloud strategy, yet still face challenges when connecting to public and private clouds. The Internet provides “best effort” connectivity but has inconsistencies in network quality that can significantly impact application performance.
Two years ago, the entire cloud communications landscape got a kickstart when investors poured money into “work-from-home stocks,” which included the UCaaS and CCaaS providers. For example, Zoom, Five9 and RingCentral had peak market caps of $161 billion, $14 billion and $40 billion, respectively, compared to $28 billion, $6.8 billion and $6.4 billion today.
Business communications service provider Avaya Inc. today reported disappointing second-quarter earnings and provided weak guidance for the third quarter, but there’s evidence that its shift to the cloud is gaining momentum.