Data integration firm Talend SA is flying high today after reporting fourth-quarter earnings that beat Wall Street’s expectations and provided revenue guidance for the current quarter that also came in above estimates.

The company reported a loss before certain costs such as stock compensation of 10 cents per share on revenue of $79 million, up 18% from the same period one year before. Analysts had been expecting Talend to report a wider loss of 30 cents per share on revenue of $74.9 million.

Talend sells extract, transact and load or ETL tools that enterprises use to connect and manage all of their data as if it came from one source, regardless of where it lives. Its platform provides more than 1,000 connectors and components that make it possible to link any data source with any data environment, including both cloud and on-premises systems. It also sells software that allows companies to clean and prepare data for analysis or artificial intelligence operations, in addition to various tools for managing and evaluating data.

Cloud revenue surges

Those tools appear to be in vogue right now. Talend Chief Executive Christal Bemont (pictured) described the company’s quarter as “strong” and pointed out that its annualized recurring revenue from cloud software doubled year-over-year, to $108.5 million, beating its own expectations. Total annualized recurring revenue rose 19% from a year ago, to $289 million. The company also noted its continued customer growth. It said it now counts more than 6,000 paying customers in total, including over 4,250 cloud customers.

“In 2020 we had tremendous success against the goals we laid out, and we believe we have laid the foundation for the next phase in our transformation to a high-growth cloud company,” she said.

In an interview with SiliconANGLE, Bemont said cloud subscription revenue is poised to overtake license revenue in the near future. “Over the next 12 to 18 months we’re going to see our cloud business become the largest part of the business; we’ll cross over that threshold,” she said.

Banking on trust

Bemont, who joined Talend as CEO just over a year ago, said the company has seen good uptake on an algorithm it introduced last summer that evaluates the trustworthiness of a company’s data. It was developed in response to what she said was an alarming realization that customers were making decisions based on questionable data quality.

“I was asking customers how they knew for a fact that the data they were using to run their business is measurably good,” she said. “I expected an answer and they said, ‘We don’t know.’ I said, ‘Oh my gosh.’”

The Trust Score, which instantly assesses the reliability of an organization’s data, has become “an opportunity to expand conversations with the customer base and expanded our partnerships with companies like Snowflake,” she said. “It’s transforming the way people see Talend.” The company said it now has more than 1,000 joint customers with cloud-native data warehousing vendor Snowflake Inc.

Analyst Holger Mueller of Constellation Research Inc. said Talend had a good quarter thanks to strong demand for its products and good sales execution, but said the company could have done even better if it were able to rein in some of its expenditures.

“Talend did not do so well on cost management, with the main culprit being its excessive sales and marketing costs,” Mueller said. “For 2021, with Talend now in its second year under CEO Bemont, it needs to try to outgrow its cost base on the revenue side, or rein in its costs better. The next few months will tell.”

For the next quarter, Talend said, it anticipates a loss of 24 to 27 cents on revenue of $77.5 million to $78.5 million. Wall Street had forecast a loss of 21 cents per share on revenue of $76.7 million.

Talend was one of many tech firms to withdraw full-year guidance during the early stages of the COVID-19 pandemic last year. The outlook for 2021 is more predictable, Bemont said. “Uncertainty still exists, but I think we have as much of a handle as you can have,” she said. “We’ll focus on the second half for acceleration of growth” with the assumption that the economy will be back on track by then.

In any case, investors didn’t seem too perturbed by the mixed guidance, as Talend’s stock jumped more than 15% in after-hours trading.

Bemont appeared on theCUBE, SiliconANGLE’s video studio, last summer to discuss the growing importance of data transformation in the enterprise:

Additional reporting by Paul Gillin

Photo: SiliconANGLE