Cloudera beats earnings expectations and ups guidance, but CEO hunt continues
Big-data firm Cloudera Inc. is keeping up the momentum, posting third-quarter financial results today that surpassed Wall Street’s expectations on earnings and revenue.
The provider of data engineering, data warehousing, machine learning and analytics software for enterprises reported a loss before certain costs such as stock compensation of three cents per share on revenue of $198.3 million. Wall Street had Cloudera down for a wider six-cent loss on revenue of $189.1 million.
Cloudera had further good news for investors with its fourth-quarter guidance, saying it’s now projecting revenue of between $200 million and $203 million for that period, with an adjusted loss in the range of two to four cents a share. That’s better than Wall Street’s forecast too, as analysts had the company down for revenue of $197 million and a loss of five cents per share.
Investors were feeling appreciative, sending Cloudera’s stock up 7% in after-hours trading.
In a statement, Cloudera’s interim chief executive officer, Marty Cole, talked up the “strong reception” by customers and analysts of the company’s new Cloudera Data Platform offering that was announced in September. CDP is made up of entirely open source components and is positioned as one-stop-shop cloud service for organizations that want to perform analytics across hybrid and multicloud environments with enterprise-grade security and governance.
“Over the last two weeks, we made CDP data center available well ahead of schedule and announced enhancements to our partner program, Cloudera Connect,” Cole said. “In the quarter, our field team continued to ramp its performance, exceeding expectations across a number of dimensions.”
These are certainly interesting times for Cloudera, which is still looking for a replacement for former CEO Tom Reilly, who left the company in the summer. Reilly’s departure came before it was revealed that activist investor Carl Icahn had taken a 18.4% stake in the firm. It’s not clear if Icahn was responsible for Reilly leaving, but the investor has a reputation for forcing leadership and organizational changes at the companies he invests in to try to unlock greater value for shareholders.
Icahn has since negotiated a standstill agreement with Cloudera that saw two of his nominees join the company’s board of directors.
Analyst Charles King of Pund-IT Inc. said Cloudera’s performance this quarter and its optimistic guidance was likely to have put a smile on both Icahn’s and its other investors’ faces.
“Cloudera’s board has a good job of running things while searching for a new chief executive,” King said. “Plus, the company inked some valuable new deals, including a partnership with Microsoft to develop a Hadoop analytics service for Azure. Overall, 2019 is ending more sweetly for Cloudera than many would have forecast a few months ago.”
Constellation Research Inc. analyst Holger Mueller said today’s results demonstrate the resilience of Cloudera during these uncertain times, but he noted that the company has yet to show the breakthroughs that were hoped for when it merged with its main rival, Hortonworks Inc.
“First order must be to find a new CEO that can lead the newly merged entity back to 30% growth with innovative offerings,” Mueller said. “In the meantime, growth in the teens is better than nothing. The longer it takes for Cloudera to get going, the harder it will be to get the attention of enterprises.”
DocuSign, Zuora, Zoom top Wall Street forecasts
Thursday was a busy day on Wall Street as several other technology firms also reported strong financial results. E-signature software company DocuSign Inc., for example, topped expectations, posting third-quarter earnings of 11 cents per share on revenue of $249.5 million, up 40% from a year ago. Wall Street had forecast earnings of just three cents per share on revenue of $239.86 million.
DocuSign CEO Dan Springer said the company is continuing to expand its Agreement Cloud products and seeing good traction with customers. DocuSign’s stock rose almost 9% in after-hours trading.
Another company that did better than expected was cloud-based subscription management firm Zuora Inc. For the third quarter, Zuora posted a loss before certain costs such as stock compensation of six cents per share on revenue of $71.8 million, up 17% year-over-year. Wall Street was expecting a bigger loss of nine cents a share on revenue of $70.4 million. Shares of Zuora were up slightly after-hours.
Videoconferencing software company Zoom Video Communications Inc. also beat Wall Street’s expectations, posting third-quarter earnings of nine cents per share on revenue of $166.6 million, up 85% year-over-year. Notably, though, the company’s revenue growth was slower than in previous quarters, which may explain why Zoom’s stock fell 8% in the after-hours trading session.
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