Shares of Zoom Video Communications (NASDAQ:ZM) climbed 5.2% on Tuesday as COVID-19 continues to spread around the world at an alarming rate.
Nearly 7 million Americans have contracted the dangerous disease, and more than 200,000 have died. Worldwide, those figures stand at 31.4 million and 967,000, respectively. Outbreaks in Europe are forcing government officials to consider new lockdown measures. Health experts in the U.S. are warning of an even higher rate of infections as we approach the winter.
"We're only seeing the tip of the iceberg," New York City health official Dr. Syra Madad told CNBC on Tuesday. "We're only nine months into this pandemic."
These disturbing trends are driving investors to seek shelter in stay-at-home stocks, of which Zoom is one of the more popular. As a leading provider of cloud-based video communications, Zoom is seeing demand for its services boom during the coronavirus pandemic.
Zoom's growth has been breathtaking. Its second-quarter revenue surged 355% year over year to $663.5 million as businesses flocked to its platform. Better still, Zoom is becoming more profitable as it scales its operations; its adjusted operating profit rose more than 13-fold, to $277 million.
With the pandemic showing little sign of abating anytime soon, demand for Zoom's video technology should remain strong in the quarters ahead.