Aureus
AExcellent

Zoom Communications, Inc.(ZM)

A

Financial data as of Jan 31, 2026Declining · Technology

FCF Margin23.9%Free Cash Flow / Revenue
Cash Conversion104.7%Operating CF / Net Income
Free Cash Flow$1.9B
Revenue$4.9B
Net Cash$1.2BCash exceeds debt
Debt / FCF0.1xManageable debt load
Current Ratio4.33Adequate short-term liquidity
YoY FCF Growth-20.7%5 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseB
→
+0.5Healthy FCF margin with manageable debt (23.9%, 0.1x)
→
-0.5FCF trend declining (-20.7% YoY)
→
+1Net cash position with strong FCF margin
→
+1Very low debt-to-FCF ratio (0.1x)
→
FinalA

Analysis Summary

Strengths

  • Exceptional FCF margin (23.9%)
  • Excellent cash conversion (105%)
  • Net cash position ($1.2B)
  • Very low debt relative to cash flow (0.1x)
  • Strong liquidity (current ratio: 4.33)

Concerns

  • Significant YoY FCF decline (-20.7%)
SBC-adjusted FCF used — $0.8B stock-based compensation (40% of reported FCF) subtracted

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin23.9%
Net Margin39.0%
Operating CF Margin40.9%
CapEx Ratio1.3%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash$1.2BCash exceeds debt
Debt / FCF0.1xManageable debt load
Current Ratio4.33Strong liquidity
Debt / Equity0.01Low leverage

Quarterly FCF Trend

-20.7% YoYDeclining (-20.7%)

Free cash flow per quarter

Sector Comparison — Technology

FCF Margin ranked against sector peers

View all →

Detailed Metrics

Company NameZoom Communications, Inc.
SectorTechnology
Free Cash Flow$1.9B
Revenue$4.9B
Net Income$1.9B
Operating Cash Flow$2.0B
Capital Expenditure$65.5M
FCF Margin23.9%
Cash Conversion Rate104.7%
Net Margin39.0%
Total Debt$58.5M
Total Cash$1.3B
Net Cash$1.2B
Current Ratio4.33
Debt / Equity0.01
Debt / FCF0.1x
YoY FCF Growth-20.7%
Positive Quarters5 of 5
Trend DirectionDeclining
Report DateJan 31, 2026
GradeA
Data SourceYahoo Finance