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Tag: Eric S. Yuan

  • Zoom and Five9 Mutually Terminate Their Merger

    Zoom and Five9 Mutually Terminate Their Merger

    Zoom and Five9 have called off their deal, in which Zoom would purchase Five9 for $14.7 billion.

    Zoom announced it was purchasing Five9 in July. Five9 is one of the leading cloud contact center providers. The deal was originally slated to complete in the first half of 2022, but the two companies have mutually ended the agreement.

    “While we were excited about the benefits this transaction would bring to both Zoom and Five9 stakeholders, including the long-term potential for both sets of shareholders, financial discipline is foundational to our strategy,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom.

    While Yuan emphasizes “financial discipline” as a motive for ending the agreement, the deal was already under US national security scrutiny. At the same time, Yuan emphasized Zoom’s ongoing commitment to the contact center market.

    “The contact center market remains a strategic priority for Zoom, and we are confident in our ability to capture its growth potential,” Yuan continued. “At Zoomtopia, we announced the Zoom Video Engagement Center, our cloud-based contact center solution, which will launch in early 2022. Video Engagement Center will be a flexible, easy-to-use solution that connects businesses and their customers. We are building this new solution with the same scalability and trusted architecture that has made Zoom the platform of choice for businesses around the world. We also plan to maintain our valued existing contact center partnerships with companies like Five9, Genesys, NICE inContact, Talkdesk, and Twilio. We remain focused on driving long-term value creation for Zoom shareholders and delivering happiness to our customers through our broad-based communications platform including unified communications, developer, and events solutions.”

  • Zoom Acquiring Five9 for $14.7 Billion

    Zoom Acquiring Five9 for $14.7 Billion

    Zoom announced it is acquiring Five9, a leading intelligent cloud contact center provider, for approximately $14.7 billion.

    Zoom has been rapidly improving its product and services, building on the success of its pandemic-fueled gains. Prior to the pandemic, the company’s platform was primarily used in the enterprise, but quickly became a household name, used by workers, schoolchildren, medical professionals, individuals and families around the world.

    The company is continuing to build out its platform, as companies continue to grapple with a changed workforce in a post-pandemic reality. Zoom believes Five9 will be a valuable part of that improvement, giving Zoom users even more ways to interact with their customers.

    “We are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom. “Zoom is built on a core belief that robust and reliable communications technology enables interactions that build greater empathy and trust, and we believe that holds particularly true for customer engagement. Enterprises communicate with their customers primarily through the contact center, and we believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers. We are thrilled to join forces with the Five9 team, and I look forward to welcoming them to the Zoom family.”

    The deal is an all-stock transaction, and is expected to close in the first half of 2022, subject to standard regulatory approvals.

  • Zoom Reports First Quarter Results, Beats Estimates

    Zoom Reports First Quarter Results, Beats Estimates

    Zoom reported its first quarter results, beating estimates amid strong growth in revenue and customers.

    The company reported revenue of $956.2 million, an increase of 191% year over year. Customers contributing more than $100,000 in yearly revenue was up roughly 160%, at 1,999. Zoom also reported 497,000 with more than 10 employees, an increase of 87% from the year-ago quarter.

    Analysts were expecting yearly revenue to come in at $3.8 billion and $3.77 a share. Instead, Zoom raised its revenue guidance to between $3.975 billion and $3.99 billion, and earnings per share between $4.56 and $4.61.

    “We kicked off the fiscal year with a very strong first quarter, posting 191% total year-over-year revenue growth combined with strong profitability and cash flow. Our steadfast commitment to empowering customers to work and learn from anywhere with our expansive, innovative, and frictionless video communications platform continued to drive our results. With this solid start, we are pleased to raise our total guidance range to $3.975 billion to $3.990 billion for the full fiscal year,” said Zoom founder and CEO, Eric S. Yuan. “We have also opened our technology portfolio to developers through our powerful video SDK and to businesses to expand their reach through Zoom Events. Work is no longer a place, it’s a space where Zoom serves to empower your teams to connect and bring their best ideas to life. We are energized to help lead the evolution to hybrid work that allows greater flexibility, productivity, and happiness to both in-person and virtual connections.”

  • Zoom Launches $100 Million Fund to Stimulate Zoom Apps Ecosystem

    Zoom Launches $100 Million Fund to Stimulate Zoom Apps Ecosystem

    Zoom has launched a $100 million fund to help stimulate and grow the app ecosystem surrounding the videoconferencing platform.

    Zoom emerged as a front-runner in the early days of the pandemic, with companies, schools, religious organizations and individuals turning to the platform to stay connected. As a result, Zoom experienced meteoric growth, far outpacing some of its rivals.

    The company is looking to ensure its long-term success, by helping build out the ecosystem of apps, hardware and integrations that will continue to improve the service Zoom offers.

    “I founded Zoom in 2011, nearly ten years ago. Without the support of early investors, Zoom would not be what it is today,” said Eric S. Yuan, Founder and CEO of Zoom. “What I’ve learned over the past year is that we need to keep meetings productive and fun. My hope is that the Zoom Apps Fund will help our customers meet happier and collaborate even more seamlessly, and at the same time help entrepreneurs build new businesses as our platform evolves.”

    According to Zoom, portfolio companies will be eligible for investments “between $250,000 and $2.5 million to build solutions that will become core to how Zoom customers meet, communicate, and collaborate.”

  • Zoom Reports Q3 Results: Beats Estimates Again

    Zoom Reports Q3 Results: Beats Estimates Again

    Zoom has reported its Q3 results, beating estimates on strong demand amid a pandemic-fueled transition to remote work.

    Zoom quickly became a favorite of companies and individuals as the pandemic forced employees to work from home, children to learn remotely and families to socialize virtually. As a result, the company has seen explosive growth, helping it beat analysts estimates yet again.

    The company reported Q3 revenue of $777.2 million, an increase of 367% year-over-year. The number of customers spending more than $100,000 in revenue was up 136% year-over-year. This is an even bigger jump than last quarter, that saw an increase of 112% year-over-year. The number of customers with more than 10 employees reached 433,700, up 485% year-over-year.

    “We remain focused on the communication needs of our customers and communities as they navigate the current environment and adapt to a new world of work from anywhere using Zoom. We aspire to provide the most innovative, secure, reliable, and high-quality communications platform to help people connect, collaborate, build and learn on Zoom,” said Zoom founder and CEO, Eric S. Yuan. “Strong demand and execution led to revenue growth of 367% year-over-year with solid growth in non-GAAP operating income and cash flow in our third fiscal quarter. We expect to strengthen our market position as we finish the fiscal year with an increased total revenue outlook of approximately $2.575 billion to $2.580 billion for fiscal year 2021, or approximately 314% increase year-over-year.”

  • Zoom End-to-End Encryption Rolling Out Next Week

    Zoom End-to-End Encryption Rolling Out Next Week

    Zoom has announced it will be rolling out end-to-end encryption (E2EE) beginning next week.

    Zoom quickly became the de facto standard for remote work and distance learning during the coronavirus pandemic. Unfortunately, the company made a number of security missteps early on, leading to a 90-day moratorium on new features as the company focused on security.

    One of those issues revolved around E2EE. The company’s early marketing made it appear as if it offered E2EE when, in fact, it did not. The company later announced definitive plans to implement E2EE, although only for paid accounts. After feedback and criticism, the company reversed course, announcing its intention to bring E2EE to all users.

    Those plans are coming to fruition, with the company implementing the first phase of its E2EE plans next week:

    We’re excited to announce that starting next week, Zoom’s end-to-end encryption (E2EE) offering will be available as a technical preview, which means we’re proactively soliciting feedback from users for the first 30 days. Zoom users – free and paid – around the world can host up to 200 participants in an E2EE meeting on Zoom, providing increased privacy and security for your Zoom sessions.

    CEO Eric S. Yuan highlighted the benefits of E2EE, both to customers and the Zoom platform:

    End-to-end encryption is another stride toward making Zoom the most secure communications platform in the world. This phase of our E2EE offering provides the same security as existing end-to-end-encrypted messaging platforms, but with the video quality and scale that has made Zoom the communications solution of choice for hundreds of millions of people and the world’s largest enterprises.

    Once enabled, users will know their meetings are encrypted with E2EE by looking at the green shield icon in the upper left corner. The normal checkmark, indicating GCM encryption, will be replaced by a padlock.

  • Zoom Reports Quarterly Results, Smashes Expectations

    Zoom Reports Quarterly Results, Smashes Expectations

    Zoom reported its quarterly results, smashing expectations as the company’s revenue was up 355% year-over-year.

    Zoom has become the de facto standard videoconferencing platform in the wake of the coronavirus pandemic. It is widely used by businesses, government agencies, schools, churches and individuals. Despite some early security and privacy missteps, the company has continued to address concerns and win customers.

    Based on its quarterly results, those efforts have paid off in spades. The company reported quarterly revenue of $663.5 million, well above a consensus of $500 million, representing a 355% year-over-year increase.

    “Organizations are shifting from addressing their immediate business continuity needs to supporting a future of working anywhere, learning anywhere, and connecting anywhere on Zoom’s video-first platform. At Zoom, we strive to deliver a world-class, frictionless, and secure communication experience for our customers across locations, devices, and use cases,” said Zoom founder and CEO, Eric S. Yuan. “Our ability to keep people around the world connected, coupled with our strong execution, led to revenue growth of 355% year-over-year in Q2 and enabled us to increase our revenue outlook to approximately $2.37 billion to $2.39 billion for FY21, or 281% to 284% increase year-over-year.”

    Interestingly, Zoom reported it has 988 customers that are paying more than $100,000 each, a 112% increase from the year-ago quarter.

  • Zoom Charts Path Toward End-to-End Encryption For All Users

    Zoom Charts Path Toward End-to-End Encryption For All Users

    Zoom is adding end-to-end encryption (E2EE ) for all users, reversing a decision made just weeks ago to reserve the highest security for paid plans.

    Zoom has been in hot water more than once in recent months over its encryption claims and policies. Originally, the company’s marketing led customers to believe it provided E2EE when it did not. Once the company finally rolled out the upgraded encryption, it said it would only be for paid subscribers.

    The rationale for the decision was that free plans were more likely to be used for illegal activities, and the company wanted to be able to work with the FBI and local law enforcement. Needless to say, the stand was not a popular one.

    It appears the company has changed direction, and charted what it believes will be a compromise solution that will allow it to offer E2EE to free users.

    “To make this possible, Free/Basic users seeking access to E2EE will participate in a one-time process that will prompt the user for additional pieces of information, such as verifying a phone number via a text message,” writes CEO Eric S. Yuan. “Many leading companies perform similar steps on account creation to reduce the mass creation of abusive accounts. We are confident that by implementing risk-based authentication, in combination with our current mix of tools — including our Report a User function — we can continue to prevent and fight abuse.”

    The move is measured solution that will likely satisfy most critics.

  • Zoom Buys Keybase, Secure Messaging and File-Sharing Provider

    Zoom Buys Keybase, Secure Messaging and File-Sharing Provider

    Zoom has acquired Keybase, the popular secure messaging and file-sharing provider in its ongoing attempt to improve its security.

    In the midst of the global pandemic, Zoom has gone from 10 million daily users to over 200 million, becoming the go-to platform for communication of all kinds. Remote workers, government agencies, online students, families, friends and more have all turned to the platform to stay connected.

    Unfortunately for the company, it has made a number of security missteps, losing some public confidence along the way. This caused Zoom to announce a moratorium on new features for 90 days, while it focused on beefing up security. This acquisition, the company’s first in its nine-year history, is major step in that direction.

    “There are end-to-end encrypted communications platforms. There are communications platforms with easily deployable security. There are enterprise-scale communications platforms. We believe that no current platform offers all of these. This is what Zoom plans to build, giving our users security, ease of use, and scale, all at once,” said Eric S. Yuan, CEO of Zoom. “The first step is getting the right team together. Keybase brings deep encryption and security expertise to Zoom, and we’re thrilled to welcome Max and his team. Bringing on a cohesive group of security engineers like this significantly advances our 90-day plan to enhance our security efforts.”

    “Keybase is thrilled to join Team Zoom!” said Max Krohn, Keybase.io co-founder and developer. “Our team is passionate about security and privacy, and it is an honor to be able to bring our encryption expertise to a platform used by hundreds of millions of participants a day.”

    It will be exciting to see just how Zoom integrates Keybase’s features to deliver on its security goals.

  • Zoom Turns to Oracle to Meet Its Infrastructure Needs

    Zoom Turns to Oracle to Meet Its Infrastructure Needs

    In a surprise move, Zoom has chosen Oracle for its latest cloud infrastructure expansion as the company experiences unprecedented growth.

    As COVID-19 has forced people to social distance, work from home, engage in remote learning and socialize digitally, Zoom has been one of the most popular platforms people have turned to. In short order, the platform went from 10 million daily users to over 300 million, putting a strain on the company’s infrastructure.

    The company already uses AWS and Microsoft for cloud infrastructure but, in an effort to keep up with demand, Zoom has struck a deal with Oracle for its latest expansion. The choice is particularly surprising given Oracle’s current place in the market, far behind AWS, Microsoft and Google. One of the motivating factors was Oracle’s security, an area where Zoom has been working to improve.

    “We recently experienced the most significant growth our business has ever seen, requiring massive increases in our service capacity. We explored multiple platforms, and Oracle Cloud Infrastructure was instrumental in helping us quickly scale our capacity and meet the needs of our new users,” said Zoom CEO Eric S. Yuan. “We chose Oracle Cloud Infrastructure because of its industry-leading security, outstanding performance, and unmatched level of support.”

    “Video communications has become an essential part of our professional and personal lives, and Zoom has led this industry’s innovation,” said Oracle CEO Safra Catz. “We are proud to work with Zoom, as both their cloud infrastructure provider and as a customer, while they grow and continue to connect businesses, people and governments around the world.”

    The deal is a huge win for Oracle as it endeavors to expand its market share, and wil likely lead to other companies looking to it as a viable option.

    Note: Clarification added to show Zoom continues to use AWS and Microsoft.