Zoom Unveils AI Companion At Zoomtopia 2023, But Analysts Differ On The Prospects

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Strengthening its competition with Microsoft Corp's (NASDAQ: MSFT) Teams and taking on Alphabet Inc's (NASDAQ: GOOG) (NASDAQ: GOOGL) Google Docs, Zoom Video Communications Inc (NASDAQ: ZM) unveiled AI-powered innovations at Zoomtopia 2023. Here's a look at key takeaways from these analysts.

  • Stifel analyst Parker Lane maintained a Hold rating, while reducing the price target from $75 to $70.
  • Morgan Stanley analyst Meta Marshall reiterated an Equal-Weight rating and price target of $78.
  • Rosenblatt Securities analyst Catharine Trebnick reaffirmed a Neutral rating and price target of $75.
  • KeyBanc Capital Markets analyst Thomas Blakey maintained a Sector Weight rating on the stock.
Stifel: The company unveiled its Zoom AI Companion at Zoomtopia, which was "at the center of attention throughout the day," Lane said in a note. Zoom seeks to integrate this "into every corner of the Zoom One platform."

The company is "still looking to translate product innovation into sustainable growth," the analyst further stated.

Morgan Stanley: The newly launched AI Companion is expected to increase the efficiency of Zoom One Platform's meetings, workflows, and customer exchanges, and improve customer and employee experiences, Marshall said.

He added, however, that while the roadmap appears "compelling," the company operates in a market "where competition is severe."

Rosenblatt Securities: "The big product announcement this year, was Zoom Docs, which builds on the company's communication and collaboration suite," Trebnick wrote in a note.

"Zoom is working to catch up with CCaaS suppliers by adding an auto dialer, but still lags pure-play vendors in global and channel reach," the analyst said. "Zoom Phone is available across 47 countries, and announced its Beta in the India market," she added.

KeyBanc Capital Markets: "Overall, we view the event as a positive in terms of Zoom maintaining its disruptive approach when entering markets (AI Companion at no additional cost) and highlighting the Company's engineering-focused engine with continued product innovation," Blakey said.

"AI has initial strong uptake with nearly 30,000 customers already downloading and using the Zoom AI Companion" while Zoom Docs, which is set to be available in 2024, would bring the company closer to its long-term goal "as a collaboration operating system for organizations," he added.

ZM Price Action: Shares of Zoom Video Communications had declined by 3.44% to $65.70 at the time of publication Wednesday.