Zoom’s business is thriving, but its stock is still stuck in 2020

A look at video conferencing company Zoom’s (ZM) stock performance in recent years highlights a common, and often frustrating, dynamic in public markets.

A company’s business performance can improve materially while its stock remains anchored to an outdated narrative.

Zoom rose to prominence during the pandemic, which forced millions of people to work remotely, making video conferencing an essential tool for daily operations.

That surge in demand propelled the company and its stock into the spotlight.

At the height of the pandemic-era stock boom in early 2021, Zoom shares peaked above $430. Since then, the stock has sharply reversed course, falling back to the mid-$80 range.

More notably, Zoom shares have traded largely sideways since early 2022, struggling to regain momentum.

The irony is that Zoom’s underlying business has continued to grow.

Revenues have increased steadily over that period, with most quarters posting flat to modest sequential gains rather than the steep declines many investors once feared.

Since hitting its record high in early 2021, Zoom’s revenue has grown at a compound annual rate of more than 40%, according to Fiscal.ai data.

Over the same period, the stock’s compound annual growth rate has been a modest 3.5%.

“This one has to go down in the history books,” wrote Fiscal.ai’s Aria Radnia, pointing to the stark divergence between Zoom’s revenue growth and its share price performance.

This one has to go down in the history books.$ZM pic.twitter.com/rvTygWOoy6

undefined Aria Radnia (@QualityInvest5) January 6, 2026

Zoom’s narrative problem

The disconnect underscores a broader truth about markets: investors don’t just price earnings and cash flow, they price narratives.

Zoom became synonymous with the pandemic. As economies reopened, that narrative flipped just as forcefully. Zoom was recast as a “pull-forward” trade.

The result is a form of reputational gravity that continues to weigh on the stock, even as the business has stabilized and, by some measures, matured.

Once investors mentally box a company into a specific era or theme, in this case, the “stay-at-home trade,” it can take years of consistent execution, or a clear strategic pivot, to reset expectations.

For what it’s worth, Zoom recently reported solid results for its fiscal third quarter, with revenue rising to $1.23 billion and non-GAAP earnings per share of $1.52, both of which exceeded analyst expectations.

The company has also been leaning into artificial intelligence, highlighting growing adoption of its AI Companion tools, which are designed to improve productivity through features such as meeting summaries, workflow automation, and customer support enhancements.

During the quarter, Zoom cited notable enterprise traction for its custom AI offerings, including agreements with Oracle and Salesforce.