It’s earnings season, which puts a bright light on newly and recently public technology firms’ performances. Given that 2015 is widely expected to be an active year for IPOs, how are the new kids doing?
Let’s take a look at New Relic, the most recently public; MobileIron, the middle child; and King, which, of the three, has been public the longest.
New Relic
Today is New Relic’s first-ever report as a public company. It turned in the following report card: Revenue of $29 million, GAAP losses of $15.6 million and adjusted losses of $11.8 million, the latter two resulting in earnings-per-share losses of $0.70 and $0.28, respectively. The company’s revenue grew 69 percent compared to the year-ago quarter.
The street had expected New Relic to report an adjusted loss of $0.37 on revenue of $26.11 million. The company anticipates revenue of $30 million to $30.5 million in the current quarter, and a non-GAAP loss of $11 million to $12 million, losing between $0.23 and $0.25 per share. Analysts previously expected revenue of $28.2 million and an adjusted loss of $0.27.
New Relic is up 6 percent in after-hours trading after its earnings and profit beat.
Update: I chatted with the company after its earnings call, and we reached the stunning consensus that it was a good quarter. I asked why the company is forecasting very modest sequential quarter growth, but was mostly rebuffed — I didn’t really expect much of an answer. I asked CEO Lew Cirne if he was surprised at the delta between his firm’s results and what analysts had expected. He essentially shrugged, saying that his company was healthier and growing more quickly than the street had expected.
MobileIron
MobileIron, which went public last summer, reported revenue of $37.7 million, up 34 percent on a year-over-year basis. The company lost $15.3 million using normal accounting methods, or $0.20 per share. On an adjusted basis, MobileIron lost $0.15 per share. Analysts had expected $34.77 million in revenue and a $0.20 per-share loss.
Notably, the company grew its “Subscription” revenue segment from $5.02 million in the year-ago quarter, to $9.13 million in the most recent period. Subscription, or recurring revenue, however, remains the smallest of its three top-line categories. The company had billings, a different revenue metric, of $42.2 million in the reported quarter, up 32 percent on a year-over-year basis.
MobileIron expects revenue of $34.8 million to $37.8 million in the current quarter. Analysts previously anticipated revenue of $36.22 million.
MobileIron is down 3.7 percent in after-hours trading.
Update: I spoke to MobileIron after its earnings call, and the firm reiterated that it intends to reach cash flow break even by the fourth quarter of 2016. MobileIron CEO Bob Tinker stated that reaching profitability is a priority for the firm. He also noted a continuing shift among his customers away from perpetual license and towards subscription payments. The firm expects the shift to continue, implying that its recurring revenue, as a percentage of its top line, will continue to expand.
King Digital
Long live the King, is roughly what investors are saying, sending shares of the gaming company up 18 percent in after hours trading. King reported revenue of $545.6 million and profit of $140.6 million, or $0.44 per share. Analysts had expected the company to earn $0.47 per share on revenue of $519.93 million.
So King beat on revenue, missed on profit and skyrocketed? Yes, because the company also announced a $150 million share buyback program, a $300 million special dividend and an acquisition that it claims will “bolster efforts to diversify into new genres.” Put more simply, King is saying that it can keep growing, and that it will return around half of its cash to shareholders.
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That’s the Young Team. All told, I don’t see anything in the numbers to indicate that the IPO window is under any threat from this earnings cycle — at least today.