Investing.com -- Zoom Video Communications Inc (NASDAQ: ZM) reported first quarter results that exceeded analyst expectations and issued stronger-than-expected guidance, sending shares up 3% in after-hours trading Thursday.

The video communications company posted adjusted earnings per share of $1.55, beating the analyst consensus of $1.42 by $0.13. Revenue reached $1.24 billion, surpassing the $1.22 billion estimate and representing a 5.5% increase YoY. CEO Eric S. Yuan attributed the strong performance to growing adoption of Zoom as an AI-first platform, noting that AI Companion paid users grew 184% YoY.

Enterprise revenue climbed 7.2% YoY to $755.7 million, while the company's trailing 12-month net dollar expansion rate for Enterprise customers improved to 99% from 98% in the prior-year quarter. The company added that it now serves 4,534 customers generating more than $100,000 in trailing 12-month revenue, up 8.2% YoY.

For the second quarter, Zoom expects adjusted EPS of $1.45 to $1.47 and revenue of $1.265 billion to $1.270 billion. The company raised its full fiscal year 2027 guidance, projecting adjusted EPS of $5.96 to $6.00, with a midpoint of $5.98 that exceeds the analyst consensus of $5.87. Full-year revenue is expected between $5.08 billion and $5.09 billion, with the midpoint of $5.085 billion slightly above the $5.07 billion consensus.

"We saw continued momentum in the first quarter, with revenue up 5.5% year over year, exceeding the high end of our guidance," Yuan said. "With strong profitability, cash flow, and an increased share repurchase authorization, we remain focused on turning AI innovation into durable growth, measurable customer value, and long-term shareholder returns."

Zoom's board authorized an additional $1.0 billion stock repurchase program, supplementing the $625.0 million remaining from a previous authorization. The company generated $500.5 million in free cash flow during the quarter, up from $463.4 million in the year-ago period.