Splunk stock shows volatility following surprise profit, new CEO

Splunk Inc. rallied at first in the extended session Wednesday but then shed those gains, dipping into negative territory, as the cloud-based enterprise software company reported a surprise profit, topped Wall Street’s outlook estimates and named a new chief executive.

shares, which had rallied more than 10% after hours soon shed those gains and dipped into negative territory. Shares were last up less than 1%, following a 1.4% decline in the regular session to close at $114.92. Over the past 12 months, shares have dropped 23%, compared with a 13% gain by the S&P 500 index
and a 3% rise by the tech-heavy Nasdaq Composite Index

Splunk reported a fourth-quarter loss of $140.8 million, or 88 cents a share, compared with a loss of $139.5 million, or 86 cents a share, in the year-ago period. The company reported adjusted net income, which excludes stock-based compensation expenses and other items, of 66 cents a share, compared with 38 cents a share in the year-ago period.

Revenue rose to $901.1 million from $745.1 million in the year-ago quarter, as cloud revenue surged 69% to $289 million. Total annual recurring revenue, or ARR, rose 32% to $3.12 billion from a year ago. ARR is a software-as-a-service metric that shows how much revenue the company can expect based on subscriptions.

Analysts surveyed by FactSet had forecast a loss of 21 cents a share on revenue of $774.6 million and total ARR of $3.12 billion, based on Splunk’s forecast revenue between $740 million and $790 million and total ARR of $3.09 billion to $3.14 billion.

“We reached a significant milestone as we surpassed $3 billion in total ARR last year, with cloud revenue growing 70%,” said Jason Child, Splunk’s chief financial officer, in a statement. “The impact of our business transformation on our financials is normalizing, and we’re well positioned for strong growth in revenue and cash flow.”

Splunk also named Gary Steele as its…


Read More

Recommended For You

Leave a Reply

Your email address will not be published. Required fields are marked *