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Here's How Coupa Software (COUP) Looks Just Ahead of Q1 Earnings

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Coupa Software Incorporated (COUP - Free Report) is slated to report first-quarter fiscal 2022 results on Jun 7.

For fiscal first quarter, the company expects net loss of 18-21 cents per share. The Zacks Consensus Estimate for the bottom line has been steady in the past 30 days at a loss of 19 cents per share. Notably, the company reported non-GAAP earnings per share of 20 cents in first-quarter fiscal 2021.

Revenues are anticipated between $151.5 million and $152.5 million. The consensus mark for fiscal first-quarter revenues is pegged at $152.75 million, which suggests growth of 28.14% from the prior-year quarter’s reported figure.

Factors to Note

Continued momentum in Business Spend Management (BSM) and Coupa Pay offerings including Coupa Treasury and Coupa Supply Chain Management (earlier known as LLamasoft) solutions and an expanding customer base are anticipated to have benefited the company’s fiscal first-quarter performance.

Coupa Software, Inc. Price and EPS Surprise

 

Coupa Software, Inc. Price and EPS Surprise

Coupa Software, Inc. price-eps-surprise | Coupa Software, Inc. Quote

 

Business enterprises, globally, have been endeavoring to optimize spending patterns to survive the economic downturn triggered by the coronavirus outbreak, which has significantly affected budgets. This is expected to have bolstered the adoption of Coupa Software’s BSM solutions in the quarter to be reported.

COVID-19 crisis has also caused a spurt in demand for Coupa Advantage Express, Strategic Sourcing, Risk Assess and Source Together solutions, which might get reflected in the company’s Subscription service revenues in the quarter to be reported.

Coupa Software anticipates Subscription revenues between $133.5 million and $134.5 million. The Zacks Consensus Estimate for Subscription revenues is currently pegged at $134 million, which suggests growth of 26.4% from the prior-year quarter’s levels.

Increasing demand for digital payment offerings like Coupa Pay, Accelerate, Invoice payments and Virtual Cards for Pos. This is likely to get reflected in fiscal first-quarter performance. The company extended these solutions to partners like American Express (AXP - Free Report) and PayPal.

Further, the acquisitions of Much-Net, Kinaxis, BELLIN, and LLamasoft are expected to have favored the performance in the about to be reported quarter.

In 2020, Coupa Software acquired LLamasoft for $1.5 billion to boost its supply chain capabilities. LLamasoft offers AI-based design and planning solutions for supply chains. For fiscal first quarter, Coupa Software expects legacy subscription revenue contribution from LLamasoft between $30 million and $35 million.

Nevertheless, COVID-19-led macroeconomic downturn led to reduced spend across small and medium-sized businesses (SMB). This might have limited growth in fiscal first quarter for Coupa Software, which currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Increasing spend on product development and acquisitions, amid stiff competition from the likes of SAP (SAP - Free Report) and Oracle (ORCL - Free Report) might have put pressure on margins in the fiscal first quarter.

Also, coronavirus-led lower spend on travel might have hampered the adoption of Coupa Travel Sabre, formerly known as Yapta. In fiscal fourth-quarter earnings conference, management noted that the company anticipates no contribution from Coupa Travel Sabre in first-quarter fiscal 2022.

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