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Asana (ASAN) Incurs Q1 Loss, Revenues Up Y/Y on User Expansion
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Asana (ASAN - Free Report) reported first-quarter fiscal 2023 non-GAAP loss of 30 cents per share, narrower than the Zacks Consensus Estimate of a loss of 35 cents. However, the figure was wider than a loss of 21 cents reported in the year-ago quarter.
Asana reported revenues of $120.6 million in the quarter, which surpassed the Zacks Consensus Estimate by 4.83%. The top line improved 57% on a year-over-year basis.
In the reported quarter, Asana's revenues were driven by its investments in the Enterprise and Business tier that attracted new customers and increased the net new land deals. Customer spending increased in the reported quarter, which directly impacted the top-line growth.
Asana’s shares have fallen 67.6% year to date, compared with the Zacks Internet Software industry’s decline of 47.7%. Meanwhile, the Zacks Computer & Technology sector has slumped 24.8%.
In the reported quarter, Asana’s product-based strategy paid off as the company has been attracting more customers with new product launches. Some of the notable product launches were Employee Impact Suite, Figma integration, and Asana Flow and Workflow builder, which helped in attracting larger customers spending more than $50K.
Asana’s total number of paying customers grew by 7,000 in the reported quarter. At the end of the fiscal first quarter, the company had more than 126,000 paying customers.
The number of customers spending $5K or more on an annualized basis grew to 16,689, up 73% year over year. Revenues from these customers soared 70% year over year.
The number of customers spending $50K or more on an annualized basis grew to 979, an increase of 102% year over year.
Overall dollar-based net retention rate was more than 120%. Dollar-based net retention rate for customers with $5K or more in annualized spending was 130%. Dollar-based net retention rate for customers with $50K or more in annualized spending was more than 145%.
Non-GAAP gross margin expanded 10 basis points (bps) on a year-over-year basis to 90%.
Total operating expenses jumped 59.8% year over year to $163.3 million.
Non-GAAP operating loss was $54.7 million, wider than $33.3 million reported in the year-ago quarter.
Balance Sheet
As of Apr 30, 2022, cash and cash equivalents, and marketable securities were $283 million compared with $315 million as of Jan 31, 2022.
In the first quarter, remaining performance obligations amounted to $250.4 million compared with the previous quarter’s $218.1 million.
As of Apr 30, 2022, free cash outflow was $42.2 million compared with $41.2 million as of Jan 31, 2022.
Guidance
For the second quarter of fiscal 2023, revenues are expected in the range of $127 million to $128 million, indicating growth between 42% and 43%.
Non-GAAP operating loss is projected to be $74-$72 million.
Non-Gaap net loss per share is expected between 39 cents per share and 38 cents per share.
For fiscal 2023, the company anticipates total revenues between $536 million and $540 million.
Zacks Rank & Other Stocks to Consider
Asana currently carries a Zacks Rank #2 (Buy). Here are some other top-ranked stocks to consider for generating better returns from the broader technology sector.
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Asana (ASAN) Incurs Q1 Loss, Revenues Up Y/Y on User Expansion
Asana (ASAN - Free Report) reported first-quarter fiscal 2023 non-GAAP loss of 30 cents per share, narrower than the Zacks Consensus Estimate of a loss of 35 cents. However, the figure was wider than a loss of 21 cents reported in the year-ago quarter.
Asana reported revenues of $120.6 million in the quarter, which surpassed the Zacks Consensus Estimate by 4.83%. The top line improved 57% on a year-over-year basis.
In the reported quarter, Asana's revenues were driven by its investments in the Enterprise and Business tier that attracted new customers and increased the net new land deals. Customer spending increased in the reported quarter, which directly impacted the top-line growth.
Asana’s shares have fallen 67.6% year to date, compared with the Zacks Internet Software industry’s decline of 47.7%. Meanwhile, the Zacks Computer & Technology sector has slumped 24.8%.
Asana, Inc. Price, Consensus and EPS Surprise
Asana, Inc. price-consensus-eps-surprise-chart | Asana, Inc. Quote
Quarter in Detail
In the reported quarter, Asana’s product-based strategy paid off as the company has been attracting more customers with new product launches. Some of the notable product launches were Employee Impact Suite, Figma integration, and Asana Flow and Workflow builder, which helped in attracting larger customers spending more than $50K.
Asana’s total number of paying customers grew by 7,000 in the reported quarter. At the end of the fiscal first quarter, the company had more than 126,000 paying customers.
The number of customers spending $5K or more on an annualized basis grew to 16,689, up 73% year over year. Revenues from these customers soared 70% year over year.
The number of customers spending $50K or more on an annualized basis grew to 979, an increase of 102% year over year.
Overall dollar-based net retention rate was more than 120%. Dollar-based net retention rate for customers with $5K or more in annualized spending was 130%. Dollar-based net retention rate for customers with $50K or more in annualized spending was more than 145%.
Non-GAAP gross margin expanded 10 basis points (bps) on a year-over-year basis to 90%.
Total operating expenses jumped 59.8% year over year to $163.3 million.
Non-GAAP operating loss was $54.7 million, wider than $33.3 million reported in the year-ago quarter.
Balance Sheet
As of Apr 30, 2022, cash and cash equivalents, and marketable securities were $283 million compared with $315 million as of Jan 31, 2022.
In the first quarter, remaining performance obligations amounted to $250.4 million compared with the previous quarter’s $218.1 million.
As of Apr 30, 2022, free cash outflow was $42.2 million compared with $41.2 million as of Jan 31, 2022.
Guidance
For the second quarter of fiscal 2023, revenues are expected in the range of $127 million to $128 million, indicating growth between 42% and 43%.
Non-GAAP operating loss is projected to be $74-$72 million.
Non-Gaap net loss per share is expected between 39 cents per share and 38 cents per share.
For fiscal 2023, the company anticipates total revenues between $536 million and $540 million.
Zacks Rank & Other Stocks to Consider
Asana currently carries a Zacks Rank #2 (Buy). Here are some other top-ranked stocks to consider for generating better returns from the broader technology sector.
Analog Devices (ADI - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ADI’s shares have fallen 3.7% in the year-to-date period compared with the Zacks Semiconductor - Analog and Mixed industry’s decline of 11.8%.
Axcelis Technologies (ACLS - Free Report) flaunts a Zacks Rank 1.
ACLS’ shares have fallen 13.9% in the year-to-date period compared with the Zacks Electronics - Manufacturing Machinery industry’s decline of 20.5%.
Avnet (AVT - Free Report) carries a Zacks Rank of 1.
Avnet’s shares have increased 18.7% in the year-to-date period compared with the Zacks Electronics - Parts Distribution industry’s decline of 0.9%.