Zoom Communications (ZM): Zoomtopia Preview: Expect Focus on Monetization of Product Breadth, and MSD+ Rev. Growth and Raised Op. Margin Outlook

J.P. Morgan maintains a Neutral rating on Zoom Communications (ZM). Zoom will host its Zoomtopia event next week, where we expect the focus of the discussion to be on the expansion opportunities across customer wallets offered by the combination of the Phone, Contact Center and Virtual Agent, along with integration and monetization opportunities associated with the partnerships with frontier LLM companies. In our view, the setup is increasingly focused on driving investor confidence in translating the breadth of the company's AI and communications portfolio into more durable, albeit modestly expanding, revenue growth. On the financial updates, we expect the company to outline a focus on reinvigorating growth with expectations for improvement over a multi-year horizon led by ramping monetization of the expanded portfolio as well as of AI features. Latest FY27 guidance implies the company is on track for 40%+ operating margins, comfortably exceeding the 33%-36% guide provided in 2024;