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NICE Q1 Earnings Top Estimates, Cloud Revenues Drive Top Line

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NICE’s (NICE - Free Report) first-quarter 2022 adjusted earnings of $1.80 per share beat the Zacks Consensus Estimate by 5.88% and increased 16.9% year over year.

Non-GAAP revenues of $527.4 million trumped the consensus mark by 3.29% and grew 15.4% year over year.

Revenues in Americas were $426 million, up 14% year over year. Revenues in EMEA were $72 million in the reported quarter, up 29%. APAC revenues increased 7% year over year to $29 million.

Top-Line Details

Cloud revenues (55.9% of revenues) rose 29.2% year over year to $294.6 million. Product revenues (14.4% of revenues) increased 16.4% from the year-ago quarter to $75.9 million.
 

Nice Price, Consensus and EPS Surprise

Nice Price, Consensus and EPS Surprise

Nice price-consensus-eps-surprise-chart | Nice Quote

 

Service revenues (29.8% of revenues) declined 3% from the year-ago quarter to $157 million.

Customer Engagement revenues increased 14% year over year to $421 million. Financial Crime & Compliance revenues increased 20% year over year to $106 million.

On a non-GAAP basis, gross margin was unchanged at 73% in the reported quarter. Product margin contracted 80 basis points (bps) to 91.6% in the reported quarter. Services margin inched up 20 bps to 72.2%.

Cloud margin expanded 100 bps year over year to 68.6%.

Research & development (R&D) expenses, as a percentage of revenues, increased 150 bps year over year to 14.5%. Sales & marketing (S&M) expenses, as a percentage of revenues, increased 70 bps to 28.9%.

General & administrative (G&A) expenses, as a percentage of revenues, declined 50 bps on a year-over-year basis to 11.2%.

On a non-GAAP basis, operating expenses, as a percentage of revenues, increased 10 bps year over year to 44.8%.

Operating margin expanded 10 bps on a year-over-year basis to 28.3%.

Balance Sheet & Other Details

As of Mar 31, 2022, NICE had cash and cash equivalents (including short-term investments) worth $1.49 billion.

Long-term debt, as of Mar 31, 2022, was $241.1 million.

The company’s cash flow from operations in the first quarter came in at $192.7 million.

Guidance

For second-quarter 2022, NICE projects non-GAAP revenues between $520 million and $530 million. Non-GAAP earnings are estimated in the $1.75-1.85 per share band.

For full-year 2022, non-GAAP revenues are expected between $2.16 billion and $2.18 billion. Non-GAAP earnings are anticipated between $7.25 and $7.45 per share.

Zacks Rank & Key Picks

NICE currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices (ADI - Free Report) , Broadcom (AVGO - Free Report) and Cisco Systems (CSCO - Free Report) . All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Analog Devices shares have outperformed the sector year to date, declining 10.3%.

ADI is set to report second-quarter fiscal 2022 results on May 18.

Broadcom’s shares have outperformed the sector year to date, declining 12.3%.

AVGO is set to report second-quarter fiscal 2022 results on June 2.

Cisco’ shares have outperformed sector year to date, declining 22.1%.

CSCO is set to report third-quarter fiscal 2022 results on May 18.


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