Zoom stock surges, market value tops Boeing, Starbucks

Business

FILE – This April 18, 2019, file photo shows a sign for Zoom Video Communications ahead of the company’s Nasdaq IPO in New York. Zoom’s videoconferencing service is deepening its integral role in life during the coronavirus pandemic as tens of thousands more businesses and other users pay for subscriptions to get more control over their virtual meetings. The surge in paying customers enabled Zoom to hail another quarter of astounding growth in a report released Monday, Aug. 31, 2020. (AP Photo/Mark Lennihan, File)

NEW YORK (AP) — Zoom surged in early trading Tuesday, making the video conferencing company more valuable than well-established companies in the auto and aviation industries.

The shares rose 40.8% to $458.08, pushing Zoom’s market value to more than $129 billion, after it reported explosive growth during the second quarter as more people paid for subscriptions, giving them more control over virtual meetings. Zoom’s revenue more than quadrupled from the same time last year to $663.5 million.

At the current level, Zoom’s market value exceeds that of two storied automakers, General Motors and Ford, combined, as well the value of aviation giant Boeing and consumer favorite Starbucks.

The company is one of the key beneficiaries of the virus pandemic as more people log on to its videoconferencing service to work from home.

In a show of confidence, Zoom raised its revenue projection for its fiscal year ending in January to nearly $2.4 billion, up from roughly $1.8 billion that the San Jose, California, company predicted in early June. The forecast is now more than double the $910 million revenue that Zoom had anticipated as it began its fiscal year.

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