Have you assessed how the international operations of Nutanix (NTNX Quick QuoteNTNX - Free Report) performed in the quarter ended October 2024? For this enterprise cloud platform services provider, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.

The global economy today is deeply interlinked, making a company's engagement with international markets a critical factor in determining its financial success and growth path. It has become essential for investors to comprehend how much a company relies on these foreign markets, as this understanding reveals the firm's potential for consistent earnings, its capacity to harness different economic cycles, and its overall growth prospects.

Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.

While delving into NTNX's performance for the past quarter, we observed some fascinating trends in the revenue from its foreign segments that are commonly modeled and observed by analysts on Wall Street.

The company's total revenue for the quarter stood at $590.96 million, increasing 15.6% year over year. Now, let's delve into NTNX's international revenue breakdown to gain insights into the significance of its operations beyond home turf.

Exploring NTNX's International Revenue Patterns

Of the total revenue, $11.22 million came from Other Americas during the last fiscal quarter, accounting for 1.90%. This represented a surprise of -25.76% as analysts had expected the region to contribute $15.11 million to the total revenue. In comparison, the region contributed $11.63 million, or 2.12%, and $13.08 million, or 2.56%, to total revenue in the previous and year-ago quarters, respectively.

During the quarter, Asia Pacific contributed $95.82 million in revenue, making up 16.21% of the total revenue. When compared to the consensus estimate of $98.13 million, this meant a surprise of -2.35%. Looking back, Asia Pacific contributed $90.19 million, or 16.46%, in the previous quarter, and $83.11 million, or 16.26%, in the same quarter of the previous year.

Europe, the Middle East and Africa accounted for 25.58% of the company's total revenue during the quarter, translating to $151.19 million. Revenues from this region represented a surprise of +6.94%, with Wall Street analysts collectively expecting $141.38 million. When compared to the preceding quarter and the same quarter in the previous year, Europe, the Middle East and Africa contributed $139.72 million (25.50%) and $124.58 million (24.38%) to the total revenue, respectively.

Revenue Projections for Overseas Markets

For the current fiscal quarter, it is anticipated by Wall Street analysts that Nutanix will report a total revenue of $641.82 million, which reflects an increase of 13.6% from the same quarter in the previous year. The revenue contributions are expected to be 2.4% from Other Americas ($15.57 million), 15.9% from Asia Pacific ($101.91 million) and 22.9% from Europe, the Middle East and Africa ($147.1 million).

For the full year, a total revenue of $2.46 billion is expected for the company, reflecting an increase of 14.4% from the year before. The revenues from Other Americas, Asia Pacific and Europe, the Middle East and Africa are expected to make up 2.6%, 17.1% and 24.6% of this total, corresponding to $64.08 million, $419.19 million and $604.93 million respectively.

The Bottom Line

Nutanix's reliance on international markets for revenues offers both opportunities and risks. Hence, keeping an eye on its international revenue trends could significantly help forecast the company's prospects.

With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.

Emphasizing a company's shifting earnings prospects is a key aspect of our approach at Zacks, especially since research has proven its substantial influence on a stock's price in the short run. This correlation is positively aligned, meaning that improved earnings projections tend to boost the stock's price.

With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.

At present, Nutanix holds a Zacks Rank #3 (Hold). This ranking implies that its near-term performance might mirror the overall market movement. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

A Look at Nutanix's Recent Stock Price Performance

The stock has declined by 3.1% over the past month compared to the 5.2% rise of the Zacks S&P 500 composite. Meanwhile, the Zacks Computer and Technology sector, which includes Nutanix, has increased 5.3% during this time frame. Over the past three months, the company's shares have experienced a gain of 12.3% relative to the S&P 500's 10.8% increase. Throughout this period, the sector overall has witnessed a 13.2% increase.