Tag Archives: data

Zendesk Stock Rises On Q4 Top-Line Beat, Keeps Adding Customers

Zendesk ( ZEN ) stock rose Wednesday after the cloud software vendor late Tuesday posted Q4 results that beat on the top line and met on the bottom line. The company reported Q4 revenue of $62.6 million, up 63% year over year and topping the consensus estimate of $60 million. It reported a per-share loss of 7 cents, matching the consensus estimate, as polled by Thomson Reuters. It reported a per-share loss of 11 cents in the year earlier quarter. Zendesk provides a cloud-based customer service software platform used primarily by small- to medium-size businesses. Its competitors include cloud software pioneer Salesforce.com ( CRM ), the leading maker of customer relationship management software. Zendesk stock was up 6%, near 17, in afternoon trading in the stock market today . Its shares, along with those of Salesforce.com and other enterprise software makers, tumbled on Feb. 5 after weak guidance by Tableau Software ( DATA ) raised fears of slower tech spending. Salesforce.com stock was up 5.5% Wednesday afternoon, and Tableau stock was up 3.5%. Zendesk finished Q4 with more than 69,000 customer accounts, up 7.8% from 64,000 in Q3. The company has a goal to reach $1 billion in revenue in 2020. “We are aggressively developing products and markets that move us beyond our core in customer support and into emerging opportunities around customer relationships.” Zendesk CEO Mikkel Svane said in the company’s earnings release. In November, Zendesk announced a partnership with Microsoft ( MSFT ), integrating its software with Microsoft Office 365. It was the first customer-service add-in for Microsoft Outlook, which is part of the Office 365 suite. Zendesk also is working with Facebook ( FB ) to add Facebook Messenger to its suite of applications. It would enable call centers to use Facebook Messenger to communicate with customers and prospects. Facebook Messenger could add $100 million in revenue, estimates Brendan Barnicle, an analyst at Pacific Crest Securities. Barnicle maintained an overweight rating on Zendesk and a price target of 35. Ross MacMillan, an analyst at RBC Capital Markets, maintained an outperform rating on Zendesk and a price target of 27. Zendesk expects Q1 revenue of $65 million to $67 million. The midpoint would be up 66% from the year-ago quarter. It sees an operating loss of $8 million to $9 million. For 2016, Zendesk expects revenue of $290 million to $300 million, up 41% at the midpoint, and an operating loss of $28 million to $30 million.  

CyberArk, FireEye Both Miss With EPS Guidance, Shares Fall Late

CyberArk Software ( CYBR ) stock crashed late Thursday despite the firm’s Q4 beat after its earnings outlook lagged, while fellow security vendor FireEye ( FEYE ) came up just short on Q4 sales and missed with its Q1 bottom-line guidance. After hours, CyberArk stock reversed an uptrend at the closing bell and was down 7.5% on the disappointing guidance. FireEye stock was down 2.5% in after-hours trading. Both stocks had taken a hit last week after weak guidance from data analytics firm Tableau Software ( DATA ) raised fears of slower IT spending this year — including security spending — as global stock markets have sunk this year on macroeconomic worries. For Q4, CyberArk reported a record-smashing $51.5 million in sales and 39 cents earnings per share ex items, up 42% and 86%, respectively, vs. the year-earlier quarter. Both measures topped the consensus of 15 analysts polled by Thomson Reuters for $43.9 million and 20 cents, and the company’s earlier guidance for $43 million to $44 million and 18-20 cents. CyberArk wrapped up the year with a record $160.8 million in sales and $1 EPS minus items vs. consensus expectations for $153.3 million and 81 cents. Sales grew 56% and EPS rose 89% vs. 2014. Three months ago, CyberArk guided to $152.3 million to $153.3 million and 80-82 cents. EPS Outlook Trails Consensus Wall Street concerns of slowing cybersecurity growth don’t apply to CyberArk, which is “providing a very proactive type of security” and is not dependent on emergency response, CyberArk CEO Udi Mokady told analysts during the company’s earnings conference call late Thursday. But both 2016 and current-quarter EPS guidance trailed analyst expectations, drawing shares down sharply after hours. For Q1, CyberArk guided to 15-16 cents EPS minus items, lagging Wall Street expectations for 17 cents. The company’s guidance is flat to down 6% year over year. Sales views for $42.5 million to $43.5 million topped the consensus model for $41.6 million, up 30% at the midpoint. CyberArk expects to pull in $205 million to $207 million in 2016 sales, up 26%-28%, topping analyst projections for $202.3 million. But the EPS outlook for 83-86 cents fell short of the consensus model for 91 cents and would be down 15.5% at the midpoint of guidance. Privileged Account Security ‘Gaining Traction’ Mokady credited competitive displacements and an increasing number of seven-figure deals for the Q4 and 2015 gains. Existing customers are “taking larger chunks” when they return year over year to sign new deals, he said. Average deal size is about $100,000-plus, he said. CyberArk’s bread-and-butter — privileged account security — is gaining traction. Hackers orchestrating high-profile breaches, such as that of the federal Office of Personnel Management, couldn’t navigate a system without privileged credentials, he said. He likened the ever-growing awareness to the “significant trajectory” firewall security software enjoyed in past decades. That awareness helped CyberArk undercut a larger French competitor for a major deal with a U.S. airline that “turned to CyberArk because the incumbent’s software was process-heavy and could not enhance security” in the way CyberArk can, Mokady said. Last quarter, CyberArk also closed a seven-figure sale with a pharmaceuticals company, deployed six products for a large health care insurance provider, and sent out another half-dozen products for the software division of a large U.S. company, he said. And CyberArk’s Viewfinity is already seeing “strong sales traction,” Mokady said. Through Viewfinity, CyberArk added nearly 300 net new customers in Q4. CyberArk now counts about 2,500 customers, including 450 organically in Q4.  Last year, CyberArk spent $30.5 million to acquire Viewfinity, a maker of software designed to secure a network at its endpoints Meanwhile, the federal government on Tuesday unveiled a spending plan that includes $19 billion in cybersecurity initiatives. For CyberArk, that means building on record federal sales, Mokady said. Last year’s 30-day Cybersecurity Sprint, where the federal Office of Management and Budget gave agencies a month to improve their security included several privileged account-centric goals. “The 30-day sprint looks more like the first mile of a marathon,” Mokady said. “It’s not just a sprint and stop, but a lot of pipeline being built.” FireEye Q4 Losses Shrink FireEye, meanwhile, reported Q4 sales of $184.8 million, up 29% from the year-earlier quarter but just shy of the $185.3 million analyst forecast. On Jan. 20, however, FireEye had preannounced Q4 results, saying it expected sales of $184 million to $185 million. It posted a Q4 per-share loss minus items of 36 cents, better than the 38-cent loss in Q4 2014 and beating the 37-cent loss analysts had forecast. For Q1, though, the company said it expected to lose 49 cents to 53 cents per share, ex items, where analysts had forecast just a 40-cent loss. Image provided by Shutterstock .

Cisco’s Steady Q2 Helps, But Enterprise IT Sector Still Jittery

Behind the scenes, Cisco Systems ( CSCO ) did what it was supposed to do last quarter, and did it a little more profitably: It provided reliable networking gear and helped others compute and communicate faster, even as formerly highflying enterprise technology stocks crashed. After Wednesday’s close, Cisco posted fiscal Q2 earnings and sales that beat analyst expectations, as did its earnings and sales outlook for the current quarter. The company’s CEO, however, acknowledged that things have been a bit dicey. While the first 10 weeks of the second quarter, through Dec. 31, were “very much in line with what we expected … (in) those last three weeks (through Jan. 23), we saw customers just pause a bit … to see what’s going on,” Cisco CEO Chuck Robbins said on the company’s earnings conference call with analysts. “The (data center) campus refresh activities, we saw customer say, ‘Hey, our infrastructure is working. Let’s hold on that (purchase) before we see which way we’re willing to go.’ ” Added CFO Kelly Kramer: “Our guidance is prudent. We expanded our range to three (percentage) points of range rather than two, because we see things as more volatile.” For the period ended Jan. 23, Cisco said per-share earnings minus items rose 7.5% from the year-earlier quarter to 57 cents minus items, while revenue slipped 1% to $11.8 billion. Excluding year-earlier performance from the television set-top box business Cisco recently sold, revenue rose 2% . Analysts polled by Thomson Reuters had expected 54 cents and $11.75 billion. A year before, Cisco’s EPS ex items had risen 13% to 53 cents, and sales grew 7% to $11.94 billion. Cisco completed the sale of its set-top box unit to Technicolor on Nov. 20, for $600 million. Excluding that business, Cisco had guided Q2 adjusted EPS to 53-55 cents, on revenue of flat-to-2% growth. For fiscal Q3, Cisco guided to EPS ex items of 54 cents to 56 cents and to a year-over-year revenue rise of 1% to 4%. Analysts had modeled 54 cents and a 0.8% decline. Cisco is the No. 1 maker of the seldom-seen but increasingly used, lightning-fast switches, routers and other networking gear behind most telecom and Internet service providers, helping to run many data centers for many Internet cloud-based operations. Cisco stock, which rose 9% in after-hours trading Wednesday after its earnings release, was up more than 9% in early trading in the stock market today , near 24.50, despite another tough start to the market overall amid global economic worries. In Wednesday’s regular session, shares fell 0.6% to 22.51, 25% off an eight-year high of 30.31, set last March. Smaller rival Juniper Networks ( JNPR ) was up nearly 1% in early trading Thursday. Cisco’s latest results helped the outlook for information technology stocks, which crashed last week after data analytics software maker  Tableau Software ( DATA ) and social media firm LinkedIn ( LNKD ) gave disappointing guidance. As global fears of a slowing economy rose, so did worries of slower IT spending. Analytics firm Splunk ( SPLK ), security vendor  Palo Alto Networks ( PANW ) and cloud software leader Salesforce.com ( CRM ) were among stocks that fell hard last week, though the latter two have recovered somewhat this week. All three stocks, however, were down in early trading Thursday, as was Tableau. Cisco: Challenging Macroenvironment “We delivered a strong Q2 and are managing the business extremely well in a challenging macro environment,” Robbins said in the company’s earnings release. “We’re managing the company on two fronts. We’re focused on continued strong execution in the near term, while investing in the innovation to lead our customers into the future.” As with the sale of its set-top box business, Cisco has been shedding slow-growth lines of business while making acquisitions in faster-growing arenas. Last week, Cisco announced its agreement to acquire Jasper Technologies, which delivers a cloud-based Internet of Things (Iot) service platform, for $1.4 billion.  The deal is expected to close this fiscal quarter. The company last quarter also completed the purchases of Portcullis, a digital security operation; Lancope, a security analytics firm; ParStream, another analytics specialist;  and 1 Mainstream, an on-demand streaming-content company. And on the call, Cisco executives said they recently completed the acquisition of Acano to help accelerate Cisco’s collaboration strategy to deliver video more broadly. In November, Cisco entered a “strategic partnership” with Ericsson ( ERIC ) which both companies say will improve their sales by the second half of this fiscal year. Robbins told analysts that Cisco and Ericsson “have begun to close transactions together. I would not translate that to any of the numbers we put out today. … We’re at the handful stage right now, but we see that accelerating.” “We delivered a strong Q2, and are managing the business extremely well in a challenging macro environment,” Cisco CEO Chuck Robbins said in the earnings release. “We’re managing the company on two fronts. We’re focused on continued strong execution in the near term while investing in the innovation to lead our customers into the future.”