Did Trump kill Zoom? Is Zoom doomed?

February 25, 2025

Did Trump kill Zoom? Is Zoom doomed?

We believe so. Zoom was almost dead already. Trump's return to office mandate for federal workers, which can be expected to be copied by most state and local government in red states and in most large and medium corporations, seem to be an insurmountable obstacle and killer blow to Zoom.

The Challenges Ahead for Zoom (ZM) as Return-to-Office Mandates Intensify

Zoom Video Communications (NASDAQ: ZM) became one of the most recognizable names in the business world during the COVID-19 pandemic. As remote work became the norm, the company's video conferencing software enabled businesses, schools, and social groups to maintain connectivity. Zoom's stock soared, reflecting its massive growth and newfound necessity. However, in 2025, as return-to-office (RTO) policies continue gaining momentum, Zoom faces mounting headwinds that could spell serious trouble for its business model and stock price.

Zoom’s Meteoric Rise During the Pandemic

Before 2020, Zoom was a relatively unknown player in the video conferencing space, competing with established platforms like Microsoft’s Skype and Cisco’s Webex. However, as lockdowns forced businesses to transition to remote work, Zoom emerged as the go-to platform for virtual meetings due to its ease of use, high-quality video, and ability to host large groups.

Zoom’s revenue skyrocketed during the COVID19 pandemic. In 2019, the company reported annual revenue of $622 million. By 2021, this figure had exploded to $4 billion. The demand for virtual meetings fueled Zoom's stock, pushing its valuation to a peak of over $150 billion.

The Gradual Decline of Zoom’s Popularity

As pandemic restrictions eased and businesses sought to return to pre-pandemic operations, Zoom's dominance began to erode. By 2023, many corporations had started implementing hybrid work models, reducing reliance on video conferencing platforms. By 2024, the full-fledged return-to-office (RTO) movement had gained serious traction, negatively impacting Zoom’s growth prospects.

A major setback came when competitors aggressively expanded their market share. Microsoft Teams, which integrates seamlessly with Office 365, became the preferred choice for many enterprises, including the federal government. Google Meet, Webex, and Slack's Huddle also provided alternatives that eroded Zoom’s market leadership. As video conferencing became almost a digital commodity, very easy to integrate technologically, Zoom began to lose clout and lose users to bigger or more agile competitors.

The Trump Administration’s End to Federal Telework

A recent and very significant blow to the remote work trend—and by extension, Zoom—came from the Trump. The messiah's administration formally overnight almost all telework and remote work for federal workers, requiring the vast majority of employees to return to their offices. With the U.S. government being one of the largest employers, this shift represents a major reduction in the need for virtual meeting software across various agencies. Trump's bold move to help the real estate sector is expected to influence state and local governments, as well as corporations, further accelerating the decline in remote work at least for now.

The Ongoing Intensification of RTO Policies

Corporate America began ordering employees back to the office as early as 2021. While initial mandates were met with resistance, companies have increasingly enforced stricter RTO policies, with many requiring employees to be in the office full-time. Companies like JPMorgan Chase, Google, Apple, and Meta have implemented mandatory in-office workdays, citing productivity concerns, company culture, and efficiency. This shift away from remote work threatens Zoom’s primary business model, as fewer meetings will require its platform.

What’s Next for Zoom?

Zoom faces a challenging road ahead. The company has attempted to diversify its offerings by expanding into AI-powered meeting tools, virtual collaboration software, and Zoom Phone services. However, these efforts have not been enough to counteract the decline in core video conferencing demand. Additionally, price competition from Microsoft Teams, which is bundled with Microsoft 365, makes it difficult for Zoom to retain enterprise customers.

Zoom may need to pivot drastically to sustain long-term relevance. Potential strategies include:

• Expanding into AI-driven productivity tools.

• Strengthening its enterprise security features to appeal to government and regulated industries.

• Acquiring or partnering with other tech firms to diversify revenue streams.

The Sky is Really Falling Down For Zoom

As of February 25, 2025, Zoom Communications Inc. (ZM) is trading at $74.22 per share, reflecting a year-to-date decline of approximately 8.5%. This downturn is influenced by a weaker-than-expected revenue outlook, as the company anticipates first-quarter fiscal 2026 revenue between $1.162 billion and $1.167 billion, slightly below analysts' expectations of $1.174 billion. 

Zoom's all-time intraday high occurred on October 19, 2020, when the stock reached $588.84. Comparatively, the current share price of $74.22 represents a substantial decline of approximately 87% from its peak. That's right, Zoom has already lost almost 90% of all the heightened value it accumulated at its peak during the pandemic. And guess what? Chances are that Zoom will continue falling down even more in the months to come. Within 12 months, we think Zoom trading at $25 per share, with a valuation of about $7 billion. That is, we anticipate Zoom losing 66% or two thirds of its current value in a year or less. 

Conclusion

In our opinion, Zoom rhymes with doom. Zoom is doomed. Zoom thrived with innovative video conferencing technology as the world embraced remote work during the COVID19 pandemic. As the technology became a digital commodity that almost anybody can offer, and as the return-to-office trend accelerates, Zoom's future looks increasingly uncertain. The company must navigate shrinking demand, heightened competition, and shifting workplace dynamics. We don't see it happening. 

Zoom would have to reinvent itself, or pray for another pandemic. The coming months will most likely prove to be particularly difficult for the once-booming video conferencing giant. Investors and analysts will be closely watching how Zoom tries to adapt to this rapidly changing environment and how Zoom tries to survive a perfect storm of market conditions against it. We wish Zoom and its people the best, but don't see a way up for Zoom any time soon. Trump killed Zoom. Zoom is doomed. 

Now you know it. 

www.creatix.one