As the pandemic surge wanes, Zoom shares are 90% below their high.

Zoom Video Communications Inc. (ZM.O) stock has lost around 90% of its value since its pandemic peak in October 2020 as the once-favorite of investors tries to adjust to a post-COVID world. As the pandemic surge wanes, Zoom shares are 90% below their high.

As a result of the company’s reduced annual sales forecast and lowest quarterly growth, at least six brokerages decreased their price targets, and the stock fell more than 10% on Tuesday.

The company is making an effort to rebuild itself by concentrating on companies that have products like the conference-hosting service Zoom Rooms and the cloud-calling service Zoom Phone. The business is attempting to rebrand itself after its video conferencing technologies helped it become well-known during lockdowns.

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Analysts predict that any economic revival would take many quarters because of slowing growth in its core web business and increased competition from Microsoft Corp.’s (MSFT.O) Teams, Cisco (CSCO.O) Webex, and Salesforce (CRM.N) Slack.

“The main problem with Zoom is that it has to spend a lot of money to maintain its market dominance. Spending to maintain market share rather than increase it is never a smart idea and was a foreshadowing of trouble to come “Sophie Lund-Yates, an equities analyst at Hargreaves Lansdown, said. Zoom shares down 90% from peak as pandemic boom fades.

Due to increased spending on product development and marketing, the company’s operational expenditures increased by 56% in the third quarter. Its adjusted operating margin decreased from 39.1% to 34.6% from the previous year. Zoom Shares Down 90% From Its Peak As Pandemic Surge Fades.

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However, Chief Executive Eric Yuan stated on a post-earnings conference that he continues to observe more deal scrutiny for new business. Some brokerages believe acquisitions might help Zoom recover its growth.

According to Needham & Co analyst Ryan Koontz, “the game is not over for them, but without acquisitions this is a multi-year route to returning to greater growth.”