11:25 AM EDT, 08/22/2024 (MT Newswires) -- Zoom Video Communications ( ZM ) reported better-than-expected Q2 results "across the board" and raised guidance by more than the Q2 upside, showing "positive signs of growth troughing," RBC Capital Markets said in a note Thursday.

The video-conferencing company reported fiscal Q2 non-GAAP earnings late Wednesday of $1.39 per diluted share on revenue of $1.16 billion, beating analyst estimates of $1.22 per share and $1.15 billion, respectively.

The $120 million increase in free cash flow, implying a 200 basis point margin expansion, was a key quarter "highlight," RBC said.

"While we aren't assuming anything significant, we think a low-point has been reached, and we see a path for Zoom to accelerate growth in the second half," RBC said in the note.

Despite improvements in enterprise performance and online churn, RBC said it sees the upcoming chief financial officer transition post-Q3 earnings as a new risk.

RBC maintained an outperform rating on Zoom's stock with a $95 price target.

Zoom shares were up more than 12% in recent trading.

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