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monday.com (MNDY) Q1 Earnings Top Estimates, Revenues Up Y/Y

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monday.com’s (MNDY - Free Report) first-quarter 2022 adjusted loss of 96 cents per share beat the Zacks Consensus Estimate by 4.95% but was wider than 63 cents reported in the year-ago quarter.

Revenues of $108.5 million trumped the consensus mark by 7.05% and jumped 84% year over year.

Net dollar retention rate was more than 125% in the reported quarter. Net dollar retention rate for customers with more than 10 users was more than 135%.

Net dollar retention rate for customers with more than $50K in annual recurring revenue (“ARR”) was more than 150%.
 

monday.com Ltd. Price, Consensus and EPS Surprise

monday.com Ltd. Price, Consensus and EPS Surprise

monday.com Ltd. price-consensus-eps-surprise-chart | monday.com Ltd. Quote

 

monday.com’s shares were up 1.87% in pre-market trading following the announcement of the first-quarter results. monday.com shares have been down 66% year to date compared with the Zacks Computer & Technology sector’s decline of 26.8%.

Quarter Details

monday.com’s number of paid customers with more than $50K in ARR was 960, up 187% year over year. The percentage of ARR attributable to customers with more than $50K in ARR was 22%, up from 12% in the first quarter of 2021.

During the reported quarter, monday.com announced the launch of monday Work OS products consisting of monday sales CRM, monday marketer, monday dev and monday projects.

The company also announced a new partnership agreement with Software House International, one of North America’s largest IT solutions’ providers.

Meanwhile, on a non-GAAP basis, gross margin contracted 40 basis points (bps) year over year to 88.8% in the reported quarter.

Research & development (R&D) expenses, as a percentage of revenues, decreased 110 bps year over year to 17.7%.

Sales & marketing (S&M) expenses, as a percentage of revenues, were unchanged at 100.1%. The company increased S&M expenses in order to win new customers in the reported quarter.

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 160 bps year over year to 11.4%.

Operating loss was $43.8 million, wider than $23.3 million reported in the year-ago quarter.

Balance Sheet & Other Details

As of Mar 31, 2022, monday.com had cash and cash equivalents (including short-term investments) worth $849.6 million.

The company’s cash used from operations in the first quarter came in at $12.9 million.

Guidance

For second-quarter 2022, monday.com projects non-GAAP revenues between $117 million and $119 million, indicating 66-69% year-over-year growth.

Non-GAAP operating loss is estimated between $33 million and $35 million.

For full-year 2022, non-GAAP revenues are expected between $488 million and $492 million.

Non-GAAP operating loss are estimated between $135 million and $139 million.

Zacks Rank & Key Picks

Monday.com 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 10.5%. ADI is set to report second-quarter fiscal 2022 results on May 18.

Broadcom’s shares have outperformed the sector year to date, declining 12.5%.

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

Cisco’ shares have outperformed sector year to date, declining 22.7%.

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