Investors got a peek into post-pandemic Zoom on Monday after the video-calling software company reported better-than-expected second-quarter earnings. However, the company struggled with tough year-over-year comparisons as offices reopen and live events return.
Zoom shares closed down 16.69% Tuesday.
The company's executives explained the slower growth, even as it delivered its first $1 billion quarter.
"What we're seeing ... is headwinds in our mass markets, so these are individual consumers and small businesses. And, as you say, they are now moving around the world. People are taking vacations again, they're going to happy hours in person," Zoom CFO Kelly Steckelberg told CNBC's "Squawk Box" on Tuesday morning.
"As we came through the back half of Q2, we started to see some additional churn there and that's what's evidenced in our guidance for the rest of the year and that's what I think you're seeing in the reaction to the stock," she added.
Zoom's guidance for the current quarter predicted strong growth from its direct and channel businesses, with weakness in the online business because of challenges among smaller customers and consumers.
Despite the stock dip, analysts remained confident in the company's growth within its enterprise efforts.
"Listen, we still believe Zoom is a very good franchise with a tremendous amount of growth in its future, but we expect the market will need to rationalize a different level of growth post-pandemic into their valuation expectations," JPMorgan's Sterling Auty said.