Collaboration software provider Asana Inc. delivered fiscal first-quarter results today that topped Wall Street’s expectations, but it forecast a wider-than-expected loss for the second quarter, sending its stock lower in after-hours trading.

The company reported a net loss for the quarter of $98.9 million, up from a loss of $60.7 million one year earlier. On a per-share basis, the company reported a loss of 30 cents, while revenue for the period rose 57% from a year ago, to $120.6 million. Wall Street had been modeling a wider loss of 35 cents per share on sales of $115 million.

For the second quarter, Asana said it’s expecting a loss of 38 to 39 cents per share on revenue of $127 million to $128 million. The forecast was disappointing, as Wall Street is eyeing a smaller loss of 32 cents per share on sales of $125.3 million. Asana’s stock had gained more than 13% earlier in the day during the regular trading session, only to fall back by 4% on the lower forecast.

Asana co-founder and Chief Executive Dustin Moskovitz (pictured) said the company delivered record revenue growth in the quarter, adding that its investments in the enterprise are finally paying off.

“We are closing bigger net new customers, our largest customers are expanding at a fast pace and our revenue mix from our enterprise and business tier continues to climb,” he said. “We believe Asana is the easiest-to-adopt work management platform for companies of all sizes.”

Asana sells a work management platform that’s used by teams to organize tasks in a centralized visual dashboard, improving coordination among workers. The company’s popularity surged during the COVID-19 pandemic as workforces around the globe shifted to a work-from-home environment. The software, which integrates with Zoom, is available as a freemium service, wherein the most basic features are free to use, but more advanced tools must be paid for.

Asana said its popularity continues to grow. It reported that it ended the first quarter with more than 126,000 paying customers, up from 119,000 at the end of the previous quarter. More important, it reported strong growth in its big-ticket customer base. The number of customers spending at least $50,000 per year on its software jumped by 102%, to 979. Moreover, customers that spend at least $5,000 a year on Asana rose by 48%, to 16,689, while revenue from that segment jumped 73%.

Holger Mueller of Constellation Research Inc. told SiliconANGLE Asana had an excellent quarter from the perspective of growth. “Growing revenue by more than 50% is a rare thing for a company that generates $100 million-plus per quarter, so it’s clear that reinventing work in the post-pandemic world is a key growth driver,” he said.

However, the analyst pointed out that this growth came at a significant cost to the company. For instance, Asana lost significantly more as a percentage of its revenue than it did one year ago.

“Asana did not even achieve the cash flow positivity that most fast-growing and loss-accumulating startups do,” Mueller continued. “It’s good to see that the management seems convinced, with its guidance, that it can turn the tide. However, it’s one thing to share guidance and quite another to deliver on it, so all eyes are on the next quarter.”

Asana also provided guidance for fiscal year 2023, saying it expects total revenue of between $536 million and $540 million, up by 42% to 43% from the year prior.

Photo: Asana