Is WFH dead? 💻
(This newsletter written by me, working from home)
Remember the days when you could roll out of bed at 8:59 for a 9am Zoom meeting in your kitchen? While there are companies do still allow fully remote work, many have now returned to the office - at the very least on a hybrid basis. So what’s changed?
Is your employer spying on you?
“Hey can you just wiggle my mouse every few minutes? I’m going out,” is a sentence that many WFH employees have likely uttered at least once to a housemate/significant other/dog in the past few years. Even more creative methods are viral Tiktoks of a computer mouse connected to a rotating desk fan to keep Teams on green the whole day, or creating an all-day meeting with yourself to stay online.
Most productivity and e-working programs by now contain some sort of functionality for employees to show when they are online, but employers sometimes go the extra step to really make sure everyone is at their desk. Two Statista studies (1, 2) found that employee suspicions are mostly correct - they are watching. Location monitoring, screen monitoring and time tracking are the 3 most popular methods of employer surveillance in the US in 2022, but other more intrusive methods include eye tracking through webcams and even tracking body movement to make sure employees are actually sat in front of the computer!
Zoom revenue since 2019
Zoom, one of the kings of WFH. Any sort of online meeting can be simply described as a Zoom meeting no matter which platform gets used. Zoom’s fiscal years are labelled with the year they end, so FY 2023 actually encompasses activity from 2022.
FY 2019 and 2020 had reasonable growth for a company of Zoom’s size and niche. FY 2021, the first year of the pandemic, quadrupled Zoom’s revenue and skyrocketed the stock as a top pick to invest in. FY 2022 almost doubled 2021’s revenue as more and more companies adopted the platform and investors were wowed by profits. FY 2023 finally saw a steeper slowdown, with “only” a 7% increase in revenue as people started returning to the office. What do you think FY 2024 will look like?
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Zoom’s income statement
Zoom’s latest annual report breaks their revenue down between Enterprise (large company subscriptions) and Online (individual customers or small/medium businesses). As the business now tries to expand beyond being just a meeting platform, Zoom has introduced several new features including Zoom phone and a team chat. The biggest roadblock to growing profits above a measly 2% margin however, is Zoom’s large operating expenses.
Earlier in 2023, Zoom laid off 1300 employees (15% of total staff) and CEO Eric Yuan cut his base salary by 98% and will forego his 2023 bonus. Similar to hundreds of other tech companies that boomed during the pandemic, the company simply overhired to meet surging demand, but now that demand is falling, they don’t have enough work to justify keeping all these new hires.
A company like Zoom doesn’t have much of a moat against industry giants like Google and Microsoft, who have quickly developed or made smart acquisitions to increase their own market share. What are your predictions for 2024 for Zoom and for WFH in general?
See you on Friday for charts on the video game industry!
Created by Miguel
WFH is alive and well. lets move on
fully remote and remote-first companies existed before covid