Zoom vs Leidos
This page compares Zoom Video Communications Inc and Leidos Holdings, Inc, examining their business models, financial performance, and market context in a neutral, accessible manner. It highlights how each company creates value, operates within its sector, and responds to industry trends, without judgement or speculation. Educational content, not financial advice.
This page compares Zoom Video Communications Inc and Leidos Holdings, Inc, examining their business models, financial performance, and market context in a neutral, accessible manner. It highlights how...
Why It's Moving
Zoom Surges on Earnings Beat and Buyback Momentum as Analysts Eye Upside
- Q3 earnings delivered $1.52 EPS versus $1.44 expected, with $1.23B revenue up 4.4% YoY, beating forecasts by $15M and highlighting Enterprise segment strength at 6% growth.
- Completed $2.38B buyback of 32.5M shares (10.6% of outstanding), boosting EPS while raised FY2026 guidance to $5.95-$5.97 EPS underscores sustained profitability.
- Analysts mixed but optimistic: Consensus Hold with $92 average target (12% upside), rising estimates (8 upward revisions), and Buy ratings citing AI Companion and low churn.
Leidos sharpens focus on high-growth defense tech by divesting non-core Varec unit.
- Supports NorthStar 2030 portfolio optimization by removing automated fuel management from Leidos' offerings, enabling sharper focus on core pillars.
- Transaction expected to close in Q4 2025, subject to customary conditions, with leadership stating it maximizes long-term value for both parties.
- Wall Street's average brokerage recommendation of 1.87 (Strong Buy territory) and upward EPS revisions to $11.72 signal growing analyst confidence.
Zoom Surges on Earnings Beat and Buyback Momentum as Analysts Eye Upside
- Q3 earnings delivered $1.52 EPS versus $1.44 expected, with $1.23B revenue up 4.4% YoY, beating forecasts by $15M and highlighting Enterprise segment strength at 6% growth.
- Completed $2.38B buyback of 32.5M shares (10.6% of outstanding), boosting EPS while raised FY2026 guidance to $5.95-$5.97 EPS underscores sustained profitability.
- Analysts mixed but optimistic: Consensus Hold with $92 average target (12% upside), rising estimates (8 upward revisions), and Buy ratings citing AI Companion and low churn.
Leidos sharpens focus on high-growth defense tech by divesting non-core Varec unit.
- Supports NorthStar 2030 portfolio optimization by removing automated fuel management from Leidos' offerings, enabling sharper focus on core pillars.
- Transaction expected to close in Q4 2025, subject to customary conditions, with leadership stating it maximizes long-term value for both parties.
- Wall Street's average brokerage recommendation of 1.87 (Strong Buy territory) and upward EPS revisions to $11.72 signal growing analyst confidence.
Which Baskets Do They Appear In?
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Explore BasketAI-Powered Productivity Platforms
Zoom's better-than-expected earnings, driven by its AI-powered features, highlight a significant market trend. This suggests a growing investment opportunity in companies that enhance business collaboration and productivity through artificial intelligence.
Published: August 23, 2025
Explore BasketEnterprise AI Software: Which Stocks May Benefit?
Zoom raised its annual financial forecasts, citing strong demand for its new artificial intelligence tools. This highlights a broader investment opportunity in enterprise software companies that are successfully integrating AI to drive growth and enhance their product offerings.
Published: August 22, 2025
Explore BasketWhich Baskets Do They Appear In?
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A major outage at Google Meet underscored the risks of relying on a single digital communication platform. This event creates an investment opportunity focused on competing services and the essential infrastructure companies that ensure digital resilience and uptime.
Published: September 9, 2025
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Zoom's better-than-expected earnings, driven by its AI-powered features, highlight a significant market trend. This suggests a growing investment opportunity in companies that enhance business collaboration and productivity through artificial intelligence.
Published: August 23, 2025
Explore BasketEnterprise AI Software: Which Stocks May Benefit?
Zoom raised its annual financial forecasts, citing strong demand for its new artificial intelligence tools. This highlights a broader investment opportunity in enterprise software companies that are successfully integrating AI to drive growth and enhance their product offerings.
Published: August 22, 2025
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Explore BasketNetwork Effect Titans
These powerful companies grow stronger with every new user, creating a self-reinforcing cycle of value. Carefully selected by our investment experts, these businesses have built formidable competitive advantages through their expanding networks in our increasingly connected world.
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Explore BasketAccess, Not Ownership Portfolio
Discover companies redefining how we consume products through subscription models and on-demand services. These carefully selected stocks represent businesses building loyal customer relationships through recurring revenue streams—a powerful trend reshaping the modern economy.
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Explore BasketInvestment Analysis
Zoom
ZM
Pros
- Zoom's strategic pivot to an AI-first platform is driving sustainable growth, with a 68% increase in AI Companion users and expanding enterprise adoption.
- The company maintains strong profitability, with a 17.4% GAAP operating margin and robust cash flow of $1.95 billion in fiscal 2025.
- Zoom holds a solid balance sheet with $7.8 billion in cash and marketable securities, supporting ongoing innovation and share repurchases.
Considerations
- Zoom's core video conferencing business faces persistent competition and market saturation, limiting growth potential in its original segment.
- Stock price volatility remains high, with technical indicators suggesting near-term downside risk and mixed investor sentiment.
- The company does not pay dividends, prioritising reinvestment over shareholder returns, which may deter income-focused investors.
Leidos
LDOS
Pros
- Leidos benefits from a diversified portfolio across defence, intelligence, civil, and health markets, reducing reliance on any single sector.
- The company has a strong track record of securing large government contracts, providing stable and recurring revenue streams.
- Leidos maintains a solid balance sheet with disciplined capital allocation, supporting strategic acquisitions and long-term growth.
Considerations
- Leidos is exposed to government budget cycles and regulatory changes, which can impact contract awards and profitability.
- The business operates in a highly competitive sector, facing pressure from both established rivals and new entrants.
- Revenue growth can be constrained by the lengthy procurement processes typical in government and defence markets.
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