Zoom Video Communications : Third Quarter 2021 Earnings Webinar Earnings Presentation

Zoom Video

Communications

Q3 FY21 Earnings

November 30, 2020

© 2020 Zoom Video Communications, Inc.

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Use of Non-GAAP Financial Measures

In addition to the financials presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this presentation includes the following non-GAAP metrics: non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating margin, non-GAAP operating income, non-GAAP EPS and non-GAAP Free Cash Flow. Non-GAAP metrics have limitations as analytical tools and you should not consider them in isolation or as a substitute for or superior to the most directly comparable financial measures prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of non-GAAP metrics versus their nearest GAAP equivalents. Other companies, including companies in our industry, may calculate non-GAAP metrics differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP metrics as tools for comparison. We urge you to review the reconciliation of Zoom's non-GAAP metrics to the most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business. See the Appendix for reconciliation between each non-GAAP metric and the most comparable GAAP measure.

© 2020 Zoom Video Communications, Inc.

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Safe Harbor Statement

This presentation and the accompanying oral presentation have been prepared by Zoom Video Communications, Inc. ("Zoom") for informational purposes only and not for any other purpose. Nothing contained in this presentation is, or should be construed as, a recommendation, promise or representation by the presenter or Zoom or any officer, director, employee, agent or advisor of Zoom. This presentation does not purport to be all-inclusive or to contain all of the information you may desire. Information provided in this presentation and the accompanying oral presentation speak only as of the date hereof.

This presentation and the accompanying oral presentation contain express and implied "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial outlook for the fourth quarter of fiscal year 2021 and full fiscal year 2021, estimated or projected costs, margins, expenditures, and investments, Zoom's future results of operations and trends regarding the same, Zoom's growth strategy and business aspirations for its video-first unified communications platform, its product strategy, its market position, and the continued impact of COVID-19 on its business and operations. In some cases, you can identify forward-looking statements by terms such as "anticipate," "believe," "estimate," "expect," "intend," "may," "might," "plan," "project," "will," "would," "should," "could," "can," "predict," "potential," "target," "explore," "continue," or the negative of these terms, and similar expressions intended to identify forward-looking statements. By their nature, these statements are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance or achievement to differ materially and adversely from those anticipated or implied in the statements, including: declines in new customers and hosts, renewals or upgrades, difficulties in evaluating our prospects and future results of operations given our limited operating history, competition from other providers of communications platforms, continued uncertainty regarding the extent and duration of the impact of COVID-19 and the responses of government and private industry thereto, as well as the impact of COVID-19 on the overall economic environment, any or all of which will have an impact on demand for remote work solutions for businesses as well as overall distributed, face-to-face interactions and collaboration using Zoom, delays or outages in services from our co-located data centers, and failures in internet infrastructure or interference with broadband access, which could cause current or potential users to believe that our systems are unreliable. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption "Risk Factors" and elsewhere in our most recent filings with the Securities and Exchange Commission (the "SEC"), including Zoom's quarterly report on Form 10-Q for the quarter ended July 31, 2020. Forward-looking statements speak only as of the date the statements are made and are based on information available to Zoom at the time those statements are made and/or management's good faith belief as of that time with respect to future events. Zoom assumes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law.

This presentation and the accompanying oral presentation also contain estimates and other statistical data made by independent parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions, and estimates of our future performance and the future performance of the markets in which we compete are necessarily subject to a high degree of uncertainty and risk.

© 2020 Zoom Video Communications, Inc.

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Zoom Video

Communications

Q3 FY21 Earnings

November 30, 2020

© 2020 Zoom Video Communications, Inc.

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Strong Q3 FY21 Performance

367% 485%

Yr/YrYr/Yr

Revenue Growth	Growth in Customers
	with > 10 employees

Recognized

Market Leader

Leader in Gartner's Magic Quadrants

for Meeting Solutions and UCaaS

© 2020 Zoom Video Communications, Inc.

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New and Existing Zoom Customers

© 2020 Zoom Video Communications, Inc.

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• First virtual Zoomtopia premier customer and community event
• Over 155,000 unique viewers
• Over 140 host customers from various industries and sizes
• Showcase the reimagining and delivering of new businesses services over Zoom

© 2020 Zoom Video Communications, Inc.

Rapid Revenue Growth

(in Millions)

© 2020 Zoom Video Communications, Inc.

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Enterprise Traction

Growth in customers generating >$100K in trailing 12-month revenue

© 2020 Zoom Video Communications, Inc.

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Rapidly Growing Customer Base

Customers1 with more than 10 employees

Q3'21: 38%

Q2'21: 36%

Revenue from

customers

with 10 or fewer

employees

© 2020 Zoom Video Communications, Inc.

1The numbers of customers are rounded down to the nearest hundred. 10

Strong Q3 Net Dollar Expansion Rate

TTM Net Dollar	• 10th consecutive quarter above 130%
Expansion Rate1	• Demonstrated ability to land and expand
+130%
• Reflects trust and loyalty with existing customers
in Q3FY21

	1We calculate net dollar expansion rate as of a period end by starting with the ARR from customers with more than 10 employees as of the 12 months prior to such
	period end (Prior Period ARR). We then calculate the ARR from these customers as of the current period end (Current Period ARR). The calculation of Current Period
© 2020 Zoom Video Communications, Inc.	ARR includes any upsells, contraction and attrition. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at the net dollar expansion	11
rate. For the trailing 12-months calculation, we take an average of this calculation over the trailing 12 months.

Growing International Presence

Yr/Yr Growth

ROW 629%

Americas

302%

© 2020 Zoom Video Communications, Inc.

1Subtotal revenue has been rounded. 12

Q3 FY21 Expenses and Margins

© 2020 Zoom Video Communications, Inc.

1 See appendix for a reconciliation of non-GAAP to GAAP financial measures.

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Growing Future Revenue under Contract

Yr/Yr Growth	Yr/Yr Growth
	142%
146%

257%

324%

© 2020 Zoom Video Communications, Inc.	1 Remaining performance Obligations (RPO) consists of both billed considerations and unbilled considerations that we expect to recognize	14
as revenue, which grew 215% year-over-year. We expect to recognize approximately 72% or $1.2 billion dollars of the total RPO as
	revenue over the next 12 months compared to 64% or $330 million dollars in Q3 last year. Subtotals have been rounded.

Rapid Cash Flow Growth

1	See appendix for a reconciliation of non-GAAP to GAAP financial measures. We define FCF as GAAP net cash provided by operating activities less purchases of property	15
© 2020 Zoom Video Communications, Inc.	and equipment. We ended Q3'21 with approximately $1.9 billion dollars in cash, cash equivalents and marketable securities, excluding restricted cash.

Q4 FY21 and Full Year Outlook

1 A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-

looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future, although it

is important to note that these factors could be material to Zoom's results computed in accordance with GAAP..

© 2020 Zoom Video Communications, Inc.

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Questions

Thank you

Appendix

GAAP to Non-GAAP Reconciliation

© 2020 Zoom Video Communications, Inc.

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GAAP to Non-GAAP Reconciliation

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© 2020 Zoom Video Communications, Inc.	1 Non-GAAPweighted-average shares used to compute diluted net income per share for YTD Q3FY20 are adjusted	21
for 50 million shares of common stock issued in connection with the IPO.

GAAP to Non-GAAP Reconciliation

© 2020 Zoom Video Communications, Inc.

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Historic Metrics

© 2020 Zoom Video Communications, Inc.

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