Zoom's Q4 2025: AI Momentum, Mitel Partnership, and the Road Ahead#
Zoom Video Communications, Inc. (ZM) is navigating a complex landscape, balancing AI-driven innovation with revenue growth challenges. This analysis provides a data-driven snapshot of recent developments, focusing on the company's Q4 2025 earnings, its AI strategy, the Mitel partnership, and its competitive positioning. All financial data is sourced from Monexa AI.
Zoom's Q4 2025 Earnings: A Mixed Bag?#
Zoom's recent Q4 2025 earnings present a nuanced picture, exceeding expectations on some fronts while raising concerns on others.
Revenue and Earnings Breakdown#
According to Monexa AI, Zoom's Q4 2025 revenue reached $1.184 billion, a +3% year-over-year increase. Earnings per share (EPS) stood at $1.41, surpassing analyst estimates. However, the company's Q1 2026 revenue guidance fell short of expectations, triggering investor apprehension. This weak guidance is particularly concerning given CEO Eric Yuan's description of fiscal year 2025 as "an incredible year, marked by a major advancement in AI" (fool.com). The market is clearly weighing Zoom's AI progress against more immediate financial metrics.
Enterprise vs. Consumer Performance#
A key highlight was the growth in enterprise revenue, which increased by +6% year-over-year and accounted for 60% of total revenue, according to Monexa AI. This indicates success in targeting larger business clients, crucial for long-term sustainability. However, it also underscores Zoom's reliance on the enterprise segment, making it vulnerable to fluctuations in enterprise IT spending. The company's exposure to the Americas market, where revenue grew +4% year over year (fool.com), further concentrates its risk profile.
AI Companion: Driving Growth or Just Hype?#
Zoom is betting big on AI, particularly the Zoom AI Companion. This AI-powered assistant offers features like automated meeting summaries, real-time transcription, and smart scheduling. Zoom plans to monetize these AI features, launching Custom AI Companion add-ons in April 2025 at $12 per user per month, as noted by Monexa AI. This represents Zoom's first direct monetization of its generative AI tools.
While adoption of the AI Companion has been promising, with a +68% quarter-over-quarter increase in monthly active users (cxtoday.com), the actual revenue impact remains to be seen. The success of these AI initiatives will depend on their ability to deliver tangible value and drive sustainable revenue growth. The market is looking for Zoom to prove that its AI investments can translate into improved ARPU and reduced churn.
Mitel Partnership: A Strategic Masterstroke?#
To expand its reach and capabilities, Zoom has partnered with Mitel, a global leader in business communications. This collaboration integrates Zoom Workplace and AI Companion with Mitel's flagship platforms, including telephony solutions (globenewswire.com).
Terms of the Mitel Deal#
The integration will roll out in phases, beginning with OpenScape Voice and OpenScape 4000 platforms. The revenue impact is expected to materialize gradually over 2025-2026, according to Monexa AI. This partnership provides Zoom access to Mitel's 70 million global end users, potentially expanding its customer base significantly (fool.com).
The partnership addresses critical growth challenges for both companies in the competitive unified communications market. For Zoom, it provides access to markets and customers where it previously had little penetration. For Mitel, facing its own set of challenges, it's a chance to offer cutting edge solutions and stay relevant.
Market Share Analysis#
Zoom faces intense competition from Microsoft Teams, Cisco Webex, and Google Meet. Microsoft Teams benefits from its integration within the Microsoft 365 ecosystem, while Cisco Webex focuses on AI-powered features within its contact center and emphasizes enterprise-grade security. Zoom is positioning itself as an AI-first platform, focusing on ease of use and innovative AI features, according to Monexa AI.
Zoom's strategic partnership with Mitel represents a competitive edge against Microsoft Teams and Cisco, which have been aggressively bundling communication solutions (stocktitan.net). The partnership could provide Zoom with access to markets and customers where it previously had little penetration, but it also highlights the pressure Zoom is under to find new avenues for growth.
Zoom vs. the Giants: Can It Compete?#
The unified communications market is intensely competitive, with Zoom contending against industry titans like Microsoft Teams and Cisco Webex. The effectiveness of Zoom's AI strategy and the Mitel partnership will be crucial in determining its future market share.
IT Spending Trends in the Americas#
Overall IT spending trends in the Americas are projected to be positive, but Zoom's recent earnings reports indicate a more modest revenue growth outlook. This suggests that while the market is growing, Zoom may not be fully capitalizing on these trends, or that macroeconomic headwinds are affecting their performance. Monitoring IT spending forecasts and enterprise software adoption rates will be important for predicting Zoom's future performance, according to Monexa AI.
Analyst Ratings and Price Targets#
Analyst opinions on Zoom are mixed, reflecting the uncertainty surrounding the company's future. While some analysts have a bullish outlook, others are more cautious, citing concerns about slowing revenue growth and increasing competition. JPMorgan analyst Mark R. Murphy maintained a Neutral rating on Zoom with a price target of $80 (benzinga.com). This divergence in perspectives underscores the need for investors to carefully assess Zoom's prospects and consider the risks and opportunities associated with the stock.
| Analyst Rating | Price Target | Source |
|---|---|---|
| Neutral | $80 | JPMorgan |
| Buy | $102 | Sachin Mittal |
| Hold | $85 | Stifel |
| Neutral | $87 | Cantor Fitzgerald |
The Future of Zoom: What Analysts Are Saying#
Analyst ratings on Zoom are mixed, with some emphasizing its AI potential and others focusing on revenue struggles. For example, Sachin Mittal gave a Buy rating with a revised target price of USD102 per share, citing strategic growth and AI integration. The current price of $74.17 (Monexa AI) is significantly below this target, suggesting potential upside if Zoom can execute its strategy effectively.
However, Stifel adjusted its price target to $85 with a Hold rating, while Cantor Fitzgerald reiterated a Neutral rating with an $87 target. These varying perspectives highlight the uncertainty surrounding Zoom's future. While the company has significant growth potential, particularly in the AI space, its ability to deliver on its promises and navigate a competitive market remains a key concern.
Key Takeaways:
- AI Monetization: Zoom's ability to monetize its AI Companion and other AI-driven features is critical for future growth.
- Enterprise Focus: Continued success in the enterprise market is essential for offsetting slowing consumer growth.
- Mitel Partnership: The Mitel partnership provides a new avenue for growth and access to a broader customer base.
- Competition: Zoom faces intense competition from Microsoft Teams, Cisco Webex, and Google Meet.
- Macroeconomic Factors: Macroeconomic conditions and the return-to-office movement could impact Zoom's performance.
Conclusion: Zoom's Path Forward in the Evolving Communications Market#
Zoom stands at a pivotal moment. Its Q4 2025 results highlight both its strengths and the challenges it faces. The focus on AI, the Mitel partnership, and enterprise revenue growth provide a foundation for future success. However, slowing revenue growth, competition, and the need to monetize AI initiatives pose significant hurdles. Zoom's ability to adapt, innovate, and deliver value in a rapidly evolving market will determine its long-term trajectory.