Eric Yuan, the CEO of Zoom Video Communications , Inc. (NASDAQ:ZM), recently sold a significant portion of his company's stock, totaling approximately $20.37 million. The sales were conducted over two consecutive days, November 5 and November 6, 2024, under a pre-established trading plan.
On November 5, Yuan sold 78,481 shares at an average price of $76.4529 and 99,011 shares at an average price of $77.269. Additionally, he sold 1,079 shares at an average price of $77.825. The transactions on this day resulted in a total sale of 178,571 shares.
The following day, Yuan continued his selling spree with 17,790 shares sold at an average price of $78.9779 and 65,543 shares at $79.8272. This brought the total shares sold over the two days to 263,904.
These transactions were part of a Rule 10b5-1 trading plan, a common strategy used by executives to systematically sell shares. As of the latest transactions, Yuan's indirect ownership of Zoom's Class A common stock through a trust has been reduced.
In other recent news, Five9 Inc (NASDAQ:FIVN). has been targeted by Legion Partners Asset Management for a board seat and cost reductions, following a similar move by Anson Funds Management who suggested a sale of the company. This comes in the wake of a failed acquisition attempt by Zoom Video Communications, who made a $15 billion offer to purchase Five9 in 2021. Five9 reported revenues of $910.5 million in 2023, indicating robust financial health despite recent shareholder challenges.
Zoom Video Communications has also been in the spotlight, maintaining its Hold rating according to an analyst review by Needham. The company reported Q2 2025 earnings and revenue exceeding expectations, with non-GAAP income from operations reaching $456 million and total revenue amounting to $1.16 billion. The company's financial success led to a revision of the full-year revenue outlook to between $4.63 billion and $4.64 billion.
Zoom's recent investor day saw the introduction of new CFO, Michelle Chang, and the unveiling of new products incorporating artificial intelligence. Analysts from firms such as Barclays (LON:BARC), Piper Sandler, Benchmark, and Mizuho (NYSE:MFG) have maintained a positive outlook on Zoom, highlighting the company's AI advancements. However, the analyst from Needham expressed caution regarding Zoom's potential to capture a significant market share in the enterprise segment.
In other developments, Zoom's long-term non-GAAP operating margin target was revised upward, reflecting expected benefits from sales and marketing efficiency. Meanwhile, Benchmark upgraded the price target for Zoom Video to $85.00 from the previous $83.00 while maintaining a Buy rating. This adjustment follows the recent financial session at Zoomtopia, where Zoom Video Communications presented revised long-term sustainable margin assessments.
InvestingPro Insights
While Eric Yuan's recent stock sales might raise eyebrows, it's crucial to consider Zoom's current financial position and market performance. According to InvestingPro data, Zoom's market capitalization stands at $24.68 billion, reflecting its significant presence in the video communications sector.
Zoom's financial health appears robust, with an InvestingPro Tip highlighting that the company "holds more cash than debt on its balance sheet." This strong liquidity position is further supported by another tip indicating that "liquid assets exceed short-term obligations," suggesting Zoom is well-positioned to meet its financial commitments.
The company's performance metrics are also noteworthy. Zoom boasts an impressive gross profit margin of 75.89% for the last twelve months as of Q2 2025, aligning with the InvestingPro Tip that notes Zoom's "impressive gross profit margins." This high profitability is a positive sign for investors, potentially offsetting concerns about insider selling.
Interestingly, Zoom's stock has shown strong momentum recently. InvestingPro Tips point out a "strong return over the last month" and "strong return over the last three months," with data showing a 17.37% return in the past month and a remarkable 42.66% return over the last three months. The stock is also "trading near 52-week high," with its price at 99.65% of its 52-week high.
These insights provide valuable context to Yuan's stock sales, suggesting that while the CEO has reduced his holdings, the company's financial foundation and recent market performance remain strong. For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Zoom, providing a deeper understanding of the company's prospects.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.