Automation software provider Appian Corp. beat Wall Street’s expectations as it delivered its fourth-quarter financial results today, but its stock fell in extended trading as its losses widened.

The company reported a loss before certain costs such as stock compensation of 28 cents per share on revenue of $125.8 million, up 20% from a year earlier. The results were good, with Wall Street analysts targeting a bigger loss of 40 cents per share on lower revenue of $122.4 million.

Even so, the overall picture for Appian looks worse, as the company delivered a net loss of $34.4 million for the quarter, rising from a loss of $25.8 million one year ago.

For the full year, Appian’s loss widened to $150.9 million, up from a loss of $88.6 million in fiscal 2021. Full-year revenue came to $468 million, up from $369.2 million last year.

Appian founder and Chief Executive Matt Calkins (pictured) hailed the company’s “loyal customers and high gross margins,” saying they provide a strong foundation as it enters fiscal 2023. “Organizations are choosing Appian to increase productivity, time to value, and return on investment during uncertain times,” he insisted.

Appian is an emerging player in the low-code business process automation market, selling a platform that makes it simpler for nontechnical workers to automate complex processes. The platform, which rivals the likes of UiPath Inc. and Automation Anywhere Inc., also enables users to create custom applications that can be deployed on any device. In addition, it offers social collaboration features that allow users to connect with team members and collaborate on projects, plus prebuilt connectors that ease integration with popular third-party apps.

The platform is certainly growing in popularity, with Appian reporting that its cloud subscription revenue grew 29% ,to $65.8 million, during the quarter. Appian’s total subscription revenue, including cloud, on-premises term licenses and maintenance and support, accounted for the bulk of Appian’s revenue at $93.2 million, up 23% from a year earlier. The rest of its sales are derived from professional services, which added $32.5 million in revenue in the quarter, up 11%.

Holger Mueller of Constellation Research Inc. praised Appian for showing resilience, saying this is due to demand for its low-cose tools from enterprises that are becoming software companies themselves.

“The bad news is that its costs grew faster than its revenue, and it is now losing $2 per share annually,” Mueller said. “If we look at the company’s earnings predictions, we can see that the management does not plan on changing anything soon. So it will continue spending to grow. We will soon see how well this goes down with investors, but clearly Appian needs to deliver on its top line.”

Looking to the first quarter of fiscal 2023, Appian said it sees losses of between 27 and 33 cents per share, the midpoint of which is just ahead of Wall Street’s forecast of a 31-cent loss. Appian also called for first-quarter revenue of $130 million to $132 million, just shy of analysts’ forecast of $132.2 million.

For the full year, Appian is targeting a loss of $1.14 to $1.07 per share on revenue of $530 million to $535 million. That compares with Wall Street’s forecast of a $1.23-per-share loss on sales of $530.5 million.

Appian’s stock, which gained around 1.5% during the regular trading session, dropped by 2% after-hours.

Photo: Appian