Cantor Fitzgerald maintains Zoom stock rating at Neutral with $87 price target

Zoom Video (ZM) received a reiterated Neutral rating and $87 price target from Cantor Fitzgerald, despite reporting its highest quarterly revenue growth in 11 quarters at 4.7% YoY, driven by stabilizing core services and growth in new offerings like Phone and Contact Center, alongside a 7% increase in its Enterprise segment. The company is actively pursuing top-line growth through product diversification and significant AI integration, including AI Companion 3.0, to convert innovation into meaningful revenue streams. While some analysts like Mizuho have raised price targets to $100, others like KeyBanc maintain an Underweight rating, reflecting a mixed outlook on Zoom's long-term growth trajectory amidst these strategic shifts.

Analysis

Zoom Video (ZM) is at a pivotal point, showing early signs of a strategic turnaround, yet facing a divided analyst community. The company reported its strongest revenue growth in 11 quarters at 4.7% year-over-year, supported by a stabilization in its core online business and a notable 7% growth in the Enterprise segment. This performance is attributed to a broadening monetization profile, where legacy meeting revenue is steadying while newer products like Phone and Contact Center, along with multi-product ARPU lifts, are becoming key growth contributors. Management's primary focus is reaccelerating top-line growth, with significant investment in its innovation pipeline, particularly artificial intelligence, exemplified by the launch of AI Companion 3.0. However, market conviction remains mixed. While Mizuho raised its price target to $100 with an Outperform rating, Cantor Fitzgerald reiterated a Neutral rating ($87 target), and KeyBanc maintained its Underweight stance ($69 target), signaling deep skepticism about Zoom's ability to convert its AI initiatives into meaningful, sustained revenue streams in the near term.

Key Decisions for Investors

• Investors should closely monitor upcoming quarterly earnings for tangible revenue generation from the new AI Companion 3.0 and sustained growth in the Phone and Contact Center segments to validate the effectiveness of the company's diversification strategy.
• Given the wide dispersion in analyst price targets, from KeyBanc's $69 to Mizuho's $100, the stock is likely to remain in a 'show-me' phase, suggesting potential volatility until a clear trend of growth reacceleration is established.
• The 7% growth in the Enterprise segment and reported multi-product ARPU lift are critical positive indicators; for current holders, these metrics justify maintaining a position while awaiting broader confirmation of the turnaround thesis.