Zoom and Five9 cancel merger

Five9 and Zoom Video Communications mutually agreed to cancel their pending merger. 

The agreement did not receive the requisite number of votes from Five9 shareholders to approve the merger with Zoom. Five9 will continue to operate as a standalone publicly traded company.

Zoom and Five9 will continue the partnership that was in place prior to the announcement, which includes support for integrations between their respective Unified Communications as a Service (UCaaS) and Contact Center as a Service (CCaaS) solutions and joint go-to-market efforts.

http://investors.five9.com

Zoom to acquire Five9 for cloud contact center as a service

Monday, July 19, 2021  Cloud, Mergers And Acquisitions, Zoom  

 Zoom Video Communications agreed to acquire Five9, an intelligent cloud contact center provider, in an all-stock transaction valued at approximately $14.7 billion based on the closing price of Zoom common stock on July 16, 2021. Five9 stockholders will receive 0.5533 shares of Class A common stock of Zoom Video Communications, Inc. for each share of Five9.

The deal combines Five9’s Contact Center as a Service (CCaaS) solution with Zoom’s broad communications platform. Five9, which is based in San Ramon, California, reports $478 million in LTM revenue and 796 upmarket/enterprise customers.

Zooms says the acquisition will broaden its total addressable opportunities to include the $24 billion contact center market. Revenue for the first quarter of 2021 increased 45% to a record $137.9 million, compared to $95.1 million for the first quarter of 2020. GAAP gross margin was 56.6% for the first quarter of 2021, compared to 57.9% for the first quarter of 2020. 

Five9's cloud contact center offers a suite of applications that allows management and optimization of customer interactions across many different channels.

“We are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom. “Zoom is built on a core belief that robust and reliable communications technology enables interactions that build greater empathy and trust, and we believe that holds particularly true for customer engagement. Enterprises communicate with their customers primarily through the contact center, and we believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers. We are thrilled to join forces with the Five9 team, and I look forward to welcoming them to the Zoom family.”

“Businesses spend significant resources annually on their contact centers, but still struggle to deliver a seamless experience for their customers,” said Rowan Trollope, Chief Executive Officer of Five9. “It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. ”

Following the close of the transaction, Five9 will be an operating unit of Zoom and Rowan Trollope will become a President of Zoom and continue as CEO of Five9, reporting to Eric Yuan.

• Rowan Trollope joined Five9 as CEO in May 2018. Previously, he was SVP and General Manager of Cisco’s Applications Group and a member of the executive leadership team. Prior to Cisco, at Symantec Rowan was Group President Sales, Marketing, and Product Development, responsible for cloud security and the SMB market. 

Read More

Zoom to acquire Five9 for cloud contact center as a service

 Zoom Video Communications agreed to acquire Five9, an intelligent cloud contact center provider, in an all-stock transaction valued at approximately $14.7 billion based on the closing price of Zoom common stock on July 16, 2021. Five9 stockholders will receive 0.5533 shares of Class A common stock of Zoom Video Communications, Inc. for each share of Five9.

The deal combines Five9’s Contact Center as a Service (CCaaS) solution with Zoom’s broad communications platform. Five9, which is based in San Ramon, California, reports $478 million in LTM revenue and 796 upmarket/enterprise customers.

Zooms says the acquisition will broaden its total addressable opportunities to include the $24 billion contact center market. Revenue for the first quarter of 2021 increased 45% to a record $137.9 million, compared to $95.1 million for the first quarter of 2020. GAAP gross margin was 56.6% for the first quarter of 2021, compared to 57.9% for the first quarter of 2020. 

Five9's cloud contact center offers a suite of applications that allows management and optimization of customer interactions across many different channels.

“We are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom. “Zoom is built on a core belief that robust and reliable communications technology enables interactions that build greater empathy and trust, and we believe that holds particularly true for customer engagement. Enterprises communicate with their customers primarily through the contact center, and we believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers. We are thrilled to join forces with the Five9 team, and I look forward to welcoming them to the Zoom family.”

“Businesses spend significant resources annually on their contact centers, but still struggle to deliver a seamless experience for their customers,” said Rowan Trollope, Chief Executive Officer of Five9. “It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. ”

Following the close of the transaction, Five9 will be an operating unit of Zoom and Rowan Trollope will become a President of Zoom and continue as CEO of Five9, reporting to Eric Yuan.

• Rowan Trollope joined Five9 as CEO in May 2018. Previously, he was SVP and General Manager of Cisco’s Applications Group and a member of the executive leadership team. Prior to Cisco, at Symantec Rowan was Group President Sales, Marketing, and Product Development, responsible for cloud security and the SMB market. 

Read More

Zoom affirms AWS as its preferred cloud

Zoom Video Communications has named AWS as its preferred cloud provider. 

AWS said it has supported Zoom since 2011, and earlier this year when the COVID-19 pandemic began impacting businesses, schools, and governments around the world, Zoom expanded its relationship with AWS to keep up with surging demand as hundreds of millions of new Zoom participants began to use the platform for everything from online education to business meetings to social gatherings to exercise classes. Over the past year, Zoom has grown on AWS to accommodate an increase from 10 million daily meeting participants in December 2019 to more than 300 million a day regularly since April 2020. 

“Faced with unprecedented global demand this past year, we’ve been able to handle it in significant part by running the substantial majority of our cloud-based workloads on our preferred cloud provider, AWS, and relying on AWS’s performance and scalability,” said Eric S. Yuan, CEO of Zoom. “Looking forward, we will continue to innovate alongside AWS to reinvent virtual collaboration and deliver secure and exciting experiences for our customers.”

“COVID-19 changed everything for Zoom, putting demands on the company to meet the video conferencing needs of hundreds of millions of new participants around the globe, and AWS was there from the beginning to ensure Zoom could scale to meet these new requirements virtually overnight,” said Andy Jassy, CEO of AWS. “When organizations build on AWS – as Zoom has done since 2011 – they transform their business, expanding and innovating much faster. Together, Zoom and AWS have delivered great experiences for new Zoom users around the world, and we look forward to using the cloud to develop new ways to help the world communicate.”

Read More

Zoom reports 458% growth in key customer segment

Zoom Video Communications reported quarterly revenue of $663.5 million, up 355% year-over-year. GAAP net income was $185.7 million, or $0.63 per share, compared to GAAP net income attributable to common stockholders of $5.5 million, or $0.02 per share in the second quarter of fiscal year 2020. Non-GAAP net income for the quarter was $274.8 million.

“Organizations are shifting from addressing their immediate business continuity needs to supporting a future of working anywhere, learning anywhere, and connecting anywhere on Zoom's video-first platform. At Zoom, we strive to deliver a world-class, frictionless, and secure communication experience for our customers across locations, devices, and use cases,” said Zoom founder and CEO, Eric S. Yuan. “Our ability to keep people around the world connected, coupled with our strong execution, led to revenue growth of 355% year-over-year in Q2 and enabled us to increase our revenue outlook to approximately $2.37 billion to $2.39 billion for FY21, or 281% to 284% increase year-over-year.”

Some metrics:

• Approximately 370,200 customers with more than 10 employees, up approximately 458% from the same quarter last fiscal year.
• 988 customers contributing more than $100,000 in trailing 12 months revenue, up approximately 112% from the same quarter last fiscal year.
• A trailing 12-month net dollar expansion rate in customers with more than 10 employees above 130% for the 9th consecutive quarter.

Read More

Zoom acquires Keybase for messaging encryption

Zoom Video Communications as acquired Keybase, a start-up offering a  secure messaging and file-sharing service. Financial terms were not disclosed.

Keybase, which is based in New York City, is a key directory that maps social media identities to encryption keys in a publicly auditable manner. Additionally, it offers an end-to-end encrypted chat and cloud storage system, called Keybase Chat and the Keybase Filesystem respectively.  The company was founded in 2014 by Chris Coyne and Maxwell Krohn. Investors included Andreessen Horowitz.

Zoom said the deal accelerates its plan to build end-to-end encryption that can reach current Zoom scalability.

“There are end-to-end encrypted communications platforms. There are communications platforms with easily deployable security. There are enterprise-scale communications platforms. We believe that no current platform offers all of these. This is what Zoom plans to build, giving our users security, ease of use, and scale, all at once,” said Eric S. Yuan, CEO of Zoom. “The first step is getting the right team together. Keybase brings deep encryption and security expertise to Zoom, and we’re thrilled to welcome Max and his team. Bringing on a cohesive group of security engineers like this significantly advances our 90-day plan to enhance our security efforts.”

“Keybase is thrilled to join Team Zoom!” said Max Krohn, Keybase.io co-founder and developer. “Our team is passionate about security and privacy, and it is an honor to be able to bring our encryption expertise to a platform used by hundreds of millions of participants a day.”

Read More

Zoom shifts its video service to Oracle Cloud

Zoom Video Communications, which earlier this month hit the milestone of 300 million daily users (up by 100 million users in a month), is turning to Oracle Cloud Infrastructure to add capacity.

The companies said that within hours of deployment, Oracle Cloud Infrastructure was able to support hundreds of thousands of concurrent Zoom meeting participants. After achieving full production, Zoom is now enabling millions of simultaneous meeting participants on Oracle Cloud Infrastructure.

“We recently experienced the most significant growth our business has ever seen, requiring massive increases in our service capacity. We explored multiple platforms, and Oracle Cloud Infrastructure was instrumental in helping us quickly scale our capacity and meet the needs of our new users,” said Zoom CEO Eric S. Yuan.

Read More

Neat builds video conferencing bar for Zoom

Neat, a start-up based in Oslo, Norway, launched its portfolio of meeting room systems designed for Zoom Video Communications.

Neat Bar has a dedicated controller and optional scheduling display and costs $2,500.

"We've combined Zoom’s excellent software team with our world-class hardware design team to deliver meeting room systems that are so radically simple, they always work,” said OJ Winge, Neat Chairman. “What Zoom has done for meetings, Neat and Zoom together will do for meeting rooms. We will make video available everywhere.”

Zoom has made a strategic investment in Neat. Through joint development and a shared roadmap, Neat has designed and developed the Neat Bar and Neat Board for Zoom.

"Keeping our customers happy remains our number one focus," said Eric S. Yuan, Zoom CEO. "Zoom's financial and engineering investment in Neat confirms our belief that its technological capabilities perfectly match our own. It enables us to accelerate our pace of innovation. Together, our teams are uniquely positioned to give Zoom users better meeting room experiences."

“The partnership between Zoom and Neat is a complete game-changer for the video collaboration industry,” said Rowan Trollope, CEO, Five9, Inc. “Zoom Meetings and Zoom Phone have fast become the communications solution of choice for our team. Neat’s video systems were designed from the ground up to deliver an exceptionally easy-to-use, high-quality experience, making Neat the obvious choice for Five9’s global Zoom Rooms deployment.”

Read More

Zoom files for IPO - annual sales now top $330 million

Zoom Video Communications filed an S-1 registration statement with the U.S. Securities and Exchange Commission relating to a proposed initial public offering of its Class A common stock. The company is seeking to list its shares on Nasdaq under the ticker symbol “ZM.”

In its S-1, Zoom disclosed annual revenue of $330 million for its fiscal year ended 31-Janauary-2019, up from $151 million the year before, and up from $61 million two years ago. The company was founded in 2011 and is headed by founder, President, and CEO Eric S. Yuan.

Read More