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Domo (DOMO) Q4 Earnings Miss Estimates, Revenues Improve Y/Y
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Domo (DOMO - Free Report) reported fourth-quarter fiscal 2022 non-GAAP loss of 41 cents per share, which was wider than the Zacks Consensus Estimate by 2.50%. The company had reported a loss of 32 cents in the year-ago quarter.
Revenues, on a non-GAAP basis, improved 23% year over year to $70 million and surpassed the consensus mark by 4.27%.
In the reported quarter, Domo revenues benefited from a 30% growth in billings and a 25% increase in the direct sales force. Improving gross retention, higher yields on market spending and improved partner contribution aided the performance.
Domo’s shares have fallen 11.3% year to date, compared with the Zacks Internet Software industry’s decline of 27.9%. Meanwhile, the Computer & Technology sector has tumbled 12.8%.
Domo’s subscription revenues increased 19% year over year to $59.6 million in the reported quarter. The subscription revenues contributed 85% to revenues.
Professional Services and other revenues contributed 15% to total revenues. The figure was $10.3 million, up 49.6% year over year.
In the fourth quarter, Domo delivered billings of $108 million, reflecting an improvement of 30% year over year, courtesy of new customer addictions, expansion in spending by existing customers and over 90% gross retention rate.
However, in the fourth quarter, operating expenses increased 26% year over year and accounted for 90% of revenues. This impacted the bottom line negatively as operating margin declined by 200 bps and operating loss on a non-GAAP basis stood at $10.4 million. In the year-ago quarter, operating loss stood at $7.2 million.
Research & development expenses, as a percentage of revenues, increased 440 bps on a year-over-year basis to 33.6%. General & administrative expenses, as a percentage of revenues, were 26.4%, down 650 bps year over year. Sales and marketing expenses, as a percentage of revenues, expanded 130 bps year over year to 56.3%.
Balance Sheet & Cash Flow
As of Jan 31, 2021, Domo had cash, cash equivalents and short-term investments of $83.6 million compared with $84.25 million as of Oct 31, 2021.
Free cash outflow was $643 thousand in the reported quarter.
Guidance
For first-quarter fiscal 2023, Domo expects revenues in the range of $73.5 million to $74.5 million.
Non-GAAP net loss is expected in the range of 38-42 cents per share in the fiscal first quarter.
Zacks Rank & Stocks to Consider
Domo carries a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the same sector are Broadcom (AVGO - Free Report) , Asana (ASAN - Free Report) and Allied Motion Technologies .
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Domo (DOMO) Q4 Earnings Miss Estimates, Revenues Improve Y/Y
Domo (DOMO - Free Report) reported fourth-quarter fiscal 2022 non-GAAP loss of 41 cents per share, which was wider than the Zacks Consensus Estimate by 2.50%. The company had reported a loss of 32 cents in the year-ago quarter.
Revenues, on a non-GAAP basis, improved 23% year over year to $70 million and surpassed the consensus mark by 4.27%.
In the reported quarter, Domo revenues benefited from a 30% growth in billings and a 25% increase in the direct sales force. Improving gross retention, higher yields on market spending and improved partner contribution aided the performance.
Domo’s shares have fallen 11.3% year to date, compared with the Zacks Internet Software industry’s decline of 27.9%. Meanwhile, the Computer & Technology sector has tumbled 12.8%.
Domo, Inc. Price, Consensus and EPS Surprise
Domo, Inc. price-consensus-eps-surprise-chart | Domo, Inc. Quote
Quarter Details
Domo’s subscription revenues increased 19% year over year to $59.6 million in the reported quarter. The subscription revenues contributed 85% to revenues.
Professional Services and other revenues contributed 15% to total revenues. The figure was $10.3 million, up 49.6% year over year.
In the fourth quarter, Domo delivered billings of $108 million, reflecting an improvement of 30% year over year, courtesy of new customer addictions, expansion in spending by existing customers and over 90% gross retention rate.
However, in the fourth quarter, operating expenses increased 26% year over year and accounted for 90% of revenues. This impacted the bottom line negatively as operating margin declined by 200 bps and operating loss on a non-GAAP basis stood at $10.4 million. In the year-ago quarter, operating loss stood at $7.2 million.
Research & development expenses, as a percentage of revenues, increased 440 bps on a year-over-year basis to 33.6%. General & administrative expenses, as a percentage of revenues, were 26.4%, down 650 bps year over year. Sales and marketing expenses, as a percentage of revenues, expanded 130 bps year over year to 56.3%.
Balance Sheet & Cash Flow
As of Jan 31, 2021, Domo had cash, cash equivalents and short-term investments of $83.6 million compared with $84.25 million as of Oct 31, 2021.
Free cash outflow was $643 thousand in the reported quarter.
Guidance
For first-quarter fiscal 2023, Domo expects revenues in the range of $73.5 million to $74.5 million.
Non-GAAP net loss is expected in the range of 38-42 cents per share in the fiscal first quarter.
Zacks Rank & Stocks to Consider
Domo carries a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the same sector are Broadcom (AVGO - Free Report) , Asana (ASAN - Free Report) and Allied Motion Technologies .
Broadcom, Allied Motion Technologies and Asana carry Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Broadcom’s shares have returned 23.1% in the past year.
Broadcom is scheduled to report first-quarter 2022 results on Mar 3.
Asana’s shares have surged 70.2% in the past year.
Asana is scheduled to report fourth-quarter 2022 results on Mar 9.
Allied Motion Technologies’ shares have appreciated 3% in the past year.
AMOT is scheduled to report fourth-quarter 2021 results on Mar 9.