Couchbase beats earnings and revenue targets and its stock inches higher
Shares of the database company Couchbase Inc. were trading higher after-hours today, after it posted fourth-quarter financial results that beat Wall Street’s expectations.
The company reported a loss before certain costs such as stock compensation of 18 cents per share, well ahead of Wall Street’s forecast of a 34-cent loss. Revenue for the period rose 19% from a year ago, to $41.6 million, beating the analyst forecast of $38.25 million. Despite the earnings beat, Couchbase was unable to avoid going deeper into the red, as it reported a net loss of $18.5 million for the quarter, up from a $12.7 million loss one year earlier.
Couchbase Chairman, President and Chief Executive Matt Cain (pictured) said his company delivered another strong quarter of sustained growth, while making substantial operational progress in fiscal 2023 overall. “This is a direct result of great execution across the company, which we are particularly pleased with despite this more challenging macro environment,” he added.
Couchbase’s revenue for the full year rose 25% from a year earlier, to $154.8 million, resulting in a net loss of $69.3 million, up from a $56.3 million net loss in fiscal 2022.
The company is the developer of the popular Couchbase NoSQL database that’s used by enterprises to power an array of business applications. The big advantage of Couchbase is that it can accommodate both structured and unstructured data at the same time, in contrast to traditional databases such as Oracle’s that can handle only one type.
Thanks to this capability, it also can function as a data cache, which means enterprises can use one system to accomplish what would previously have required three. In recent months, Couchbase has been focused on the emerging “database-as-a-service” niche with Couchbase Capella, a cloud-hosted version of its database that launched last year on Amazon Web Services. Later, it brought Capella to Google Cloud, and during the previous quarter, it expanded its database-as-a-service to all three major cloud platforms by launching Capella on Microsoft Azure.
There were other positive numbers for Couchbase as well. Its subscription revenue for the quarter rose 16%, to $38.1 million, suggesting decent growth with the Capella service. The company also reported annual recurring revenue of $163.7 million at the end of the quarter, up 23% from a year ago. Remaining performance obligations came to $165.9 million, up 3% from a year earlier.
Constellation Research Inc. analyst Holger Mueller said Couchbase delivered on another good quarter, though he noted that its growth has dipped slightly from over 20%, to just under. Still, he said he’s optimistic that the company may be able to accelerate its growth again.
“By bringing Capella to all three major clouds with its launch on Azure, Couchbase’s offerings will become more attractive to companies that are building next-generation applications,” Mueller said. “The company has made some progress on the cost management side too, with its loss per share down by a third from the previous year. For Couchbase, 2023 will be all about maintaining growth.”
Despite its encouraging growth, Couchbase was somewhat cautious regarding guidance for the coming quarter and full year. It said it sees first-quarter revenue of between $39.5 million and $40.1 million, just below Wall Street’s consensus estimate of $40.6 million. For fiscal 2024 overall, Couchbase expects revenue to fall somewhere between $171.7 million and $174.7 million, versus Wall Street’s $176.6 million forecast.
Couchbase’s stock, which stayed flat during regular trading, gained almost 3% in the after-hours session.
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