Cathie Wood continued to load up on Zoom Video shares amid the sell-off this year, and the red-hot investor broke down why. Ark Invest's flagship ETF — Ark Innovation (ARKK) — scooped up 538,573 shares of video conferencing company Zoom Video on Tuesday, according to the firm's daily trading wrap sent through its website. Based on Zoom Video's closing price of $206.64 per share, Ark's purchase was worth more than $111 million. "We believe for the first time in decades that the communication system of the world is going to be replaced. Innovation solves problems," Wood said Wednesday on CNBC's " Squawk Box ." "Many people simply think Zoom is a video chat service - it is not. It is becoming a unified communication system." Wood's big buy came as Zoom Video plunged nearly 15% on Tuesday. The video-chat company warned investors of a revenue growth slowdown , leading Wall Street firms to cut price targets on the stock. However, Zoom exceeded analysts' earnings and revenue estimates for the last quarter and issued better-than-expected guidance. "I'm fairly amazed that they are showing increases at all. I think this is one of the most important communication companies to come along in many decades," Wood said. The star investor said older companies in the video conferencing business like Cisco and Polycom are going to be replaced by Zoom. "They are going to be ripped out because in the new hybrid world, we can't have the latency problems and the performance problems that they have. I know I feel when I'm going to be on a video call, I'm relieved that it's Zoom because I know it's going to work. Many others don't," Wood said. Zoom shares are down 38% in 2021 after a blockbuster year that saw its share rally nearly 400%. Millions of people adopted its software to remotely attend classes and meetings after the coronavirus pandemic made in-person gatherings nearly impossible. "The communications part of the tech stack is the largest — it's $1.5 trillion globally. Zoom is a $4 billion revenue company right now, so we think it has miles to go," Wood said.
Cathie Wood, founder and CEO of ARK Investment Management LLC, speaks during the Skybridge Capital SALT New York 2021 conference in New York, September 13, 2021.