Nutanix (NTNX - Free Report) reported non-GAAP third-quarter fiscal 2022 loss of 5 cents per share, significantly narrower than the Zacks Consensus Estimate of a loss of 20 cents. The figure was narrower than the year-ago quarter’s loss of 41 cents per share.
Nutanix reported revenues of $403.7 million, missing the Zacks Consensus Estimate of $438.5 million. The top line improved 17% from the year-earlier quarter’s figure of $344.5 million. NTNX noted that the average contract term length declined to 3.2 years from 3.3 years in the year-ago quarter, primarily due to higher federal businesses that usually have shorter contract term lengths.
During the fiscal third quarter, Nutanix’s Annual Contract Value (ACV) billings jumped 28% to $204.7 million.
Top-Line Details
Product revenues (49.5% of revenues) increased 15.8% year over year to $199.6 million. Support, entitlements & other services revenues (50,5% of revenues) grew 18.5% to $204 million.
The top line was primarily driven by growth in NTNX’s core hyperconverged infrastructure software and the solid adoption of its new capabilities.
Nutanix continues to witness a strong adoption of its hybrid multi-cloud solutions across Fortune 100 and Global 2000 companies.
Subscription revenues (92% of revenues) rose 21% from the year-ago quarter’s figure to $370.5 million. Professional services revenues (6% of revenues) jumped 15.4% to $22.5 million.
Non-Portable Software revenues (2% of revenues) plunged 43.7% year over year to $9.4 million. Hardware revenues (0.3% of revenues) increased 30% to $1.3 million.
Billings were up 20.7% year over year to $448 million. Nutanix’s run-rate ACV grew 19.3% year over year to $1.73 billion. Annual Recurring Revenue (ARR) climbed 46% to $1.1 billion.
During the fiscal third quarter, Nutanix added 580 customers, taking the total number of clients to 21,980.
Operating Details
During the fiscal third quarter, Nutanix’s non-GAAP gross margin expanded 160 basis points (bps) year over year to 83.3%.
Non-GAAP operating expenses decreased 5% year over year to $341.7 million.
Balance Sheet & Cash Flow
As of Apr 30, 2022, cash and cash equivalents plus short-term investments were $1.30 billion, up from $1.29 billion at the end of second-quarter fiscal 2022.
During the third quarter of fiscal 2022, cash utilized through operating activities was $3.2 million, and free cash flow was negative $20.1 million. During the first nine months of fiscal 2022, Nutanix generated $29.5 million of cash from operating activities and a free cash flow of negative $4.7 million.
Outlook
For fourth-quarter fiscal 2022, Nutanix expects ACV billings between $175 million and $185 million. Revenues are estimated between $340 million and $360 million.
Non-GAAP gross margin is estimated to be approximately 79-80%. Non-GAAP operating expenses are expected in the range of $360 million to $365 million.
Nutanix revised guidance for the full fiscal. NTNX now expects ACV billings between $735 million and $745 million compared with the previously guided range of $760-$765 million. Revenues are now estimated in the range of $1.535 billion to $1.555 billion compared with the prior range of $1.625-$1.630 billion.
Non-GAAP gross margin is now estimated to be 82% compared with the earlier guidance of 82.5%. Non-GAAP operating expenses are now projected in the range of $1.402 billion to $1.407 billion compared with the previous estimate of $1.465-$1.470 billion.
Zacks Rank & Key Picks
Nutanix currently carries a Zacks Rank #3 (Hold). Shares of NTNX have declined 32.2% in the past year.
Some better-ranked stocks from the broader Computer and Technology sector are Avnet (AVT - Free Report) , Analog Devices (ADI - Free Report) and Axcelis Technologies (ACLS - Free Report) . While Avnet and Axcelis sport a Zacks Rank #1 (Strong Buy), Analog Devices carries a Zacks Rank of 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Avnet's fourth-quarter fiscal 2022 earnings has been revised 55 cents northward to $1.96 per share over the past 30 days. For 2022, earnings estimates have moved 20.5% north to $6.83 per share in the past 30 days.
Avnet's earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 21.2%. Shares of AVT have gained 3.9% in the past year.
The Zacks Consensus Estimate for Axcelis' second-quarter 2022 earnings has been revised 3 cents upward to 99 cents per share over the past 30 days. For 2022, ACLS' earnings estimates have moved 41 cents north to $4.40 per share in the past 30 days.
Axcelis' earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 23.5%. Shares of ACLS have jumped 38.1% in the past year.
The Zacks Consensus Estimate for Analog Devices' third-quarter fiscal 2022 earnings has been revised 24 cents upward to $2.42 per share over the past seven days. For fiscal 2022, earnings estimates have moved 81 cents north to $9.24 per share in the past seven days.
Analog Devices' earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 7.7%. Shares of ADI have decreased 1% in the past year.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Nutanix (NTNX - Free Report) reported non-GAAP third-quarter fiscal 2022 loss of 5 cents per share, significantly narrower than the Zacks Consensus Estimate of a loss of 20 cents. The figure was narrower than the year-ago quarter’s loss of 41 cents per share.
Nutanix reported revenues of $403.7 million, missing the Zacks Consensus Estimate of $438.5 million. The top line improved 17% from the year-earlier quarter’s figure of $344.5 million. NTNX noted that the average contract term length declined to 3.2 years from 3.3 years in the year-ago quarter, primarily due to higher federal businesses that usually have shorter contract term lengths.
During the fiscal third quarter, Nutanix’s Annual Contract Value (ACV) billings jumped 28% to $204.7 million.
Top-Line Details
Product revenues (49.5% of revenues) increased 15.8% year over year to $199.6 million. Support, entitlements & other services revenues (50,5% of revenues) grew 18.5% to $204 million.
The top line was primarily driven by growth in NTNX’s core hyperconverged infrastructure software and the solid adoption of its new capabilities.
Nutanix continues to witness a strong adoption of its hybrid multi-cloud solutions across Fortune 100 and Global 2000 companies.
Subscription revenues (92% of revenues) rose 21% from the year-ago quarter’s figure to $370.5 million. Professional services revenues (6% of revenues) jumped 15.4% to $22.5 million.
Non-Portable Software revenues (2% of revenues) plunged 43.7% year over year to $9.4 million. Hardware revenues (0.3% of revenues) increased 30% to $1.3 million.
Billings were up 20.7% year over year to $448 million. Nutanix’s run-rate ACV grew 19.3% year over year to $1.73 billion. Annual Recurring Revenue (ARR) climbed 46% to $1.1 billion.
During the fiscal third quarter, Nutanix added 580 customers, taking the total number of clients to 21,980.
Operating Details
During the fiscal third quarter, Nutanix’s non-GAAP gross margin expanded 160 basis points (bps) year over year to 83.3%.
Non-GAAP operating expenses decreased 5% year over year to $341.7 million.
Balance Sheet & Cash Flow
As of Apr 30, 2022, cash and cash equivalents plus short-term investments were $1.30 billion, up from $1.29 billion at the end of second-quarter fiscal 2022.
During the third quarter of fiscal 2022, cash utilized through operating activities was $3.2 million, and free cash flow was negative $20.1 million. During the first nine months of fiscal 2022, Nutanix generated $29.5 million of cash from operating activities and a free cash flow of negative $4.7 million.
Outlook
For fourth-quarter fiscal 2022, Nutanix expects ACV billings between $175 million and $185 million. Revenues are estimated between $340 million and $360 million.
Non-GAAP gross margin is estimated to be approximately 79-80%. Non-GAAP operating expenses are expected in the range of $360 million to $365 million.
Nutanix revised guidance for the full fiscal. NTNX now expects ACV billings between $735 million and $745 million compared with the previously guided range of $760-$765 million. Revenues are now estimated in the range of $1.535 billion to $1.555 billion compared with the prior range of $1.625-$1.630 billion.
Non-GAAP gross margin is now estimated to be 82% compared with the earlier guidance of 82.5%. Non-GAAP operating expenses are now projected in the range of $1.402 billion to $1.407 billion compared with the previous estimate of $1.465-$1.470 billion.
Zacks Rank & Key Picks
Nutanix currently carries a Zacks Rank #3 (Hold). Shares of NTNX have declined 32.2% in the past year.
Some better-ranked stocks from the broader Computer and Technology sector are Avnet (AVT - Free Report) , Analog Devices (ADI - Free Report) and Axcelis Technologies (ACLS - Free Report) . While Avnet and Axcelis sport a Zacks Rank #1 (Strong Buy), Analog Devices carries a Zacks Rank of 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Avnet's fourth-quarter fiscal 2022 earnings has been revised 55 cents northward to $1.96 per share over the past 30 days. For 2022, earnings estimates have moved 20.5% north to $6.83 per share in the past 30 days.
Avnet's earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 21.2%. Shares of AVT have gained 3.9% in the past year.
The Zacks Consensus Estimate for Axcelis' second-quarter 2022 earnings has been revised 3 cents upward to 99 cents per share over the past 30 days. For 2022, ACLS' earnings estimates have moved 41 cents north to $4.40 per share in the past 30 days.
Axcelis' earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 23.5%. Shares of ACLS have jumped 38.1% in the past year.
The Zacks Consensus Estimate for Analog Devices' third-quarter fiscal 2022 earnings has been revised 24 cents upward to $2.42 per share over the past seven days. For fiscal 2022, earnings estimates have moved 81 cents north to $9.24 per share in the past seven days.
Analog Devices' earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 7.7%. Shares of ADI have decreased 1% in the past year.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on ADI - FREE
Get the latest research report on AVT - FREE
Get the latest research report on ACLS - FREE
Get the latest research report on NTNX - FREE