DevOps company JFrog Ltd.’s stock was unable to make up for its losses earlier today as the overall market swooned, despite posting third-quarter financial results and guidance for the fourth quarter that was in line with Wall Street’s expectations.

JFrog’s stock fell more than 7% in the hours running up to the report, and stayed flat in after-hours trading.

The company reported earnings before certain costs such as stock compensation of two cents per share on revenue of $72 million, up 34% from a year ago. Wall Street had been expecting the company to break even on slightly lower revenue of $71.1 million. Altogether, JFrog reported a net loss of $23.5 million for the quarter, up from the $20.4 million loss it reported in the same period last year.

JFrog is a provider of software developer tools, best known for its open-source binary code repository manager Artifactory. The offering is somewhat similar to GitHub, which is used by developers to store their code. But it caters to a different part of the development lifecycle, storing the binary files that are created when engineers compile code into a functioning program.

The JFrog Platform also includes JFrog Pipelines, a continuous integration and continuous delivery platform. It’s used to create automated software workflows that transform raw code into binaries before deploying them automatically.

Co-founder and Chief Executive Shlomi Ben Haim (pictured) highlighted that the company’s results exceeded Wall Street’s guidance across all metrics, with cloud revenue growing by more than 60%, to $21 million.

“We are reimagining the way DevOps and Security play together,” the CEO said. “As part of our strategy, we launched JFrog’s Advanced Security, a ground-shaking DevSecOps product that is now part of our platform, and provides our users a binary-focused approach to software supply chain security.”

JFrog reeled off a list of positive metrics that underscore the continued growth of its business at a time when many other tech companies are not. For instance, it reported a net dollar retention rate — a measure of its ability to retain customers and the revenue they provide — of 130% in the quarter.

It’s doing well on the customer acquisition front too. JFrog reported that it now has 696 customers that spend at least $100,000 a year on its software, up 49% from a year earlier. Of those, 18 spend more than $1 million a year on its products and services, up from 14 such customers one year earlier.

The company added that customers that have adopted the complete JFrog platform now account for 39% of its total revenue, compared with 34% one year before.

Holger Mueller of Constellation Research Inc. said JFrog is doing well because it provides enterprises with something they desperately need as they become more reliant on software.

“Enterprises need a way to power their complete software supply chain, and that’s what JFrog gives them,” Mueller said. “This shows with JFrog’s latest quarterly results, which highlight the company’s continued strong growth. The question now, though, is for how long can JFrog continue to rack up losses, given the current economic environment? It may need to think about a path to profitability sooner, rather than later.”

Looking ahead to the fourth quarter, JFrog said it’s expecting earnings of between a penny and two cents per share, with revenue forecast in a range of $76.5 million to $77.5 million. Wall Street is looking for earnings of two cents per share on revenue of $77 million.

Photo: JFrog