Take Zoom’s Amazing Free Cash Flow With a Grain of Salt
Few companies have benefited from the pandemic-driven lockdowns around the world more than Zoom Video Communications (NASDAQ: ZM). Employers have turned to Zoom's video conferencing tech as working from home became the norm, and consumers have been using Zoom to keep in touch with friends and family.
In Zoom's first quarter, which ended on April 30, the numbers told the story of Zoom's success. Revenue rocketed 169% from the prior-year period to $328.2 million; the number of customers with more than 10 employees jumped 354% to around 265,000; and net income rose from basically breakeven in the first quarter of last year to $27 million.
Beyond the astounding revenue growth, Zoom's free cash flow is getting a lot of attention. The company reported free cash flow of $251.7 million for the first quarter, up from just $15.3 million in the same period last year. Zoom converted nearly 77% of its revenue into cold, hard cash.
Source Fool.com
