Tableau Software (NYSE:DATA) released first-quarter 2019 results on Thursday after the market closed, demonstrating sustained momentum in its shift away from perpetual licenses and toward a more lucrative recurring subscription model. 

The data visualization software leader also modestly adjusted its full-year guidance for the better, leaving shares up around 4.6% on Friday in response. Let's take a closer look at how Tableau started the year and what investors should be watching in the coming quarters.

Tableau software visualizing data on a computer monitor as a finger points to it.

IMAGE SOURCE: TABLEAU SOFTWARE.

Tableau results: The raw numbers

Metric Q1 2019 Q1 2018 Year-Over-Year Growth

GAAP revenue

$282.5 million

$246.2 million

14.7%

GAAP net income (loss)

($88.9 million)

($46.5 million)

N/A

GAAP earnings (loss) per diluted share

($1.04)

($0.57)

N/A

DATA SOURCE: SS&C TECHNOLOGIES. GAAP = generally accepted accounting principles.

What happened with Tableau this quarter?

  • Adjusted for items like stock-based compensation, Tableau generated (non-GAAP) net income of roughly $2 million, or $0.02 per share, down from $5.8 million, or $0.07 per share in the same year-ago period.
  • By comparison, revenue was slightly below the midpoint of Tableau's latest guidance (provided in February), which called for between $278 million and $292 million. But adjusted earnings were above the high end of expectations calling for a per-share range between a loss of $0.09 to net income of $0.01.
  • License revenue climbed 8.1% year over year, to $117.6 million, while maintenance and services revenue grew 20%, to $164.9 million.
  • Tableau's total annual recurring revenue climbed 41% year over year exiting the first quarter, to $902 million. Within that, subscription annual recurring revenue soared 115%, to $510.1 million. 
  • Tableau repurchased 34,986 shares during the quarter for $4.2 million, leaving $275.7 million remaining under its repurchase authorization.

What management had to say

"We saw strong subscription momentum during Q1 with our mix at 84 percent and our annual recurring revenue exceeding $900 million, up 41 percent year-over-year," stated Tableau CEO Adam Selipsky. "We are seeing more and more customers cultivate a data-driven culture in their organizations due to the ease of use and flexibility of Tableau's end-to-end analytics platform."

Looking ahead

During the subsequent conference call, Tableau management told investors to expect second-quarter 2019 revenue of between $313 million and $328 million, good for year-over-year growth of 14% at the midpoint. On the bottom line, that should translate to adjusted net income per share of between $0.22 and $0.33.

As such, Tableau narrowed its full fiscal-year 2019 outlook to call for revenue of $1.34 billion to $1.40 billion (up $10 million from the bottom end of its previous range) or year-over-year growth of 19% at the midpoint. It also expects annual recurring revenue of $1.13 billion to $1.16 billion (up from $1.12 billion to $1.15 billion previously), for 36% growth at the midpoint. Tableau also increased its guidance for 2019 adjusted earnings per share of $1.58 to $1.85, or a $0.04 per-share increase from the lower end of its old range.

In the end, this quarter went as well as any long-term investor could have hoped for, with continued strong demand for Tableau's solutions as it marches forward with its promising business transition. And the stock is unsurprisingly climbing as a result.