Video communications firm Zoom saw its shares plummet by 11% despite posting its first ever quarter revenue in excess of $1 billion.

According to analysts, the market reaction suggests there is uncertainty as to the long-term growth prospects for the company as the working world returns to the office.

Second quarter revenue reached $1.02 billion, a 54% year on year increase. However, the firm has forecast a slight reduction in revenue for the third quarter

While the forecast was broadly in line with analysts’ expectations, the expected slowdown in growth has led investors to question the long term prospects for what was one of the most popular stocks in the early stages of the pandemic and the mass move to working from home.

However, as governments have reopened their economies and workers have started returning to their offices, investors have gone lukewarm on the stock.   

Zoom has also faced competition from more established platforms such as Cisco's Webex and Microsoft Teams when it comes to winning big business deals.

According to Zoom’s chief financial officer Kelly Steckelberg, the company had expected a slowdown towards the end of the year, but “it’s just happened a little bit more quickly than we expected”.

Mark Crouch, analyst at multi-asset investment platform eToro, said: “Zoom’s second quarter results impressed, but the reason its shares have crashed in after-hours trading is that investors are concerned where future growth will come from.

“The shift to home working may well become permanent, but what long-term working patterns and the post-lockdown economy will look like is still unknown. While its video conferencing software may be useful, investor behaviour over the past few months suggests they think it has had its time in the sun,” added Crouch.