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April 2, 2020, 9:38 a.m. EDT

Zoom says it topped 200 million daily participants in March as CEO addresses privacy concerns

Company has faced growing criticism about ‘Zoom bombing’ disruptions, privacy policies

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By Emily Bary

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Zoom shares have surged as more companies moved to remote-work setups during the COVID-19 outbreak, but the company has faced criticism for its privacy policy.

Zoom Video Communications Inc. announced late Wednesday that the company exceeded 200 million daily meeting participants in March, as countries worldwide urged employees to work from home amid the COVID-19 pandemic.

The disclosure came in a blog post from Chief Executive Eric Yuan, who also addressed some of the growing privacy concerns around Zoom’s /zigman2/quotes/211319643/composite ZM +3.40%  service that have emerged as more people opt to use the service for purposes other than work-oriented videoconferencing.

See more: Zoom Video lurches from boom to backlash amid privacy issues, ‘Zoom bombing’ attacks

”We now have a much broader set of users who are utilizing our product in a myriad of unexpected ways, presenting us with challenges we did not anticipate when the platform was conceived,” Yuan said in the post.

While Zoom was a popular tool for work-oriented videoconferences before the novel coronavirus outlook began, the company’s offering has since caught on in other areas. Many schools and colleges now conduct remote classes, religious institutions hold their services, bands stream concerts, and friends host virtual happy hours all using the platform.

One big issue is the rising trend of “Zoom bombing,” which occurs when unwanted people join public Zoom meetings and seek to disrupt the video calls, including the sharing of inappropriate images.

Yuan said that Zoom posted a blog post in mid-March that provided suggestions on how organizations could prevent these sorts of disruptions, by limiting screen-sharing privileges and requiring meeting passwords, but he added that the company has since amended that blog post to take a more serious tone.

Zoom “changed the name and content of that blog post, which originally referred to uninvited participants as ‘party crashers,’” Yuan wrote in his latest missive, as the old phrasing “clearly doesn’t suffice” given the serious nature of the disruptions.

/zigman2/quotes/211319643/composite ZM 287.68, +9.46, +3.40%
/zigman2/quotes/210599714/realtime SPX 4,432.99, -40.76, -0.91%

Other concerns center on the company’s privacy policy and whether calls held on the platform are actually secure.

“To be clear, in a meeting where all of the participants are using Zoom clients, and the meeting is not being recorded, we encrypt all video, audio, screen sharing, and chat content at the sending client, and do not decrypt it at any point before it reaches the receiving clients,” Zoom said in a separate Wednesday blog post focused on encryption.

Yuan noted that the company issued a post a few days back about the company’s general privacy policy, “explicitly clarifying that we do not sell our users’ data, we have never sold user data in the past, and have no intention of selling users’ data going forward.”

Zoom has made changes to its education-specific plans so that teachers, by default, are the only ones able to share their screens in a class.

The company has also removed an “attention tracking” feature that showed meeting hosts if attendees had another screen up above their Zoom windows during a screen-sharing presentation.

Zoom’s stock has been a rare winner on the year, with shares doubling as the S&P 500 /zigman2/quotes/210599714/realtime SPX -0.91%  lost 24%, on enthusiasm for the service’s growing utility. Zoom was tight-lipped about user growth before Thursday, but the company’s latest data points bear out the surging interest in its product: Zoom had upward of 200 million daily meeting participants in March, whereas its prior record as of the end of 2019 had been 10 million.

The stock has had a tougher run this week, however, with shares falling in each of the past three trading sessions. On Thursday, the stock slumped 13% in morning trading.

US : U.S.: Nasdaq
$ 287.68
+9.46 +3.40%
Volume: 5.42M
Sept. 17, 2021 4:00p
P/E Ratio
Dividend Yield
Market Cap
$85.48 billion
Rev. per Employee
-40.76 -0.91%
Volume: 3.79B
Sept. 17, 2021 5:25p

Emily Bary is a MarketWatch reporter based in New York.

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