Zoom Communications forecast third-quarter profit below Wall Street expectations on Tuesday, signaling stiff competition was squeezing the video-conferencing company even as it ramps up AI features on its services.
Shares of the San Jose, California-based company fell 3.8% in extended trading.
Zoom has been rolling out AI tools, including an AI Companion assistant, a meeting receptionist assistant and its suite of enterprise-focused AI features under "Zoom AI Services" to attract more customers.
But the company has been facing stiff competition from rivals such as Microsoft's Teams and Alphabet's Google Meet.
Zoom forecast third-quarter revenue in the range of $1.275 billion to $1.28 billion, compared with analysts' average estimate of $1.28 billion, according to data compiled by LSEG.
The company forecast third-quarter adjusted profit between $1.46 and $1.48 per share, below analysts' average estimate of $1.50 per share.
The company posted second-quarter revenue of $1.28 billion, above analysts' average estimate of $1.27 billion, according to LSEG.
Second-quarter adjusted profit per share came in at $1.55, above analysts' average estimate of $1.48.
