Shares of Cloudera (CLDR) plunged 42.6% in June, according to data from S&P Global Market Intelligence, ignoring the broader market's rise (with the S&P 500 up 7%) after the cloud software specialist announced mixed fiscal first-quarter 2020 results, reduced its full-year guidance, and announced the resignation of its CEO.
To be sure, virtually all of Cloudera's harrowing drop last month came on June 6, the first trading day after the company revealed its quarterly revenue had arrived at $187.5 million. That was up from roughly $103.5 million a year earlier (albeit thanks largely to its recently completed merger with Hortonworks), but around $1 million below analysts' consensus estimates. That translated to an adjusted net loss of $34.1 million, or $0.13 per share, better than the average prediction for a $0.23-per-share loss.
CEO Tom Reilly partly blamed the revenue miss on certain customers' decisions to "postpone renewal and expansion of their agreements in anticipation of the new platform's release," referring to this summer's launch of the new Cloudera Data Platform. Still, Reilly insisted "customer feedback and enthusiasm validates demand for enterprise data cloud solutions in [Cloudera's] target market."
It certainly didn't help, however, that Reilly had simultaneously announced he will retire as CEO and from Cloudera's board at the end of this month. He framed his move as "the right time ... to retire and transition leadership of the company as it enters the next chapter of growth."
But the company also seemed to contradict the argument that its revenue miss was caused by temporary delays ahead of the launch of its Cloudera Data Platform. It lowered its full-year targets for revenue to a range of $745 million to $765 million (a massive decrease from the previous range of $835 million to $855 million), with an adjusted net loss per share of $0.28 to $0.32 (an improvement from the loss of $0.32 to $0.36 previously forecast).
During the subsequent conference call, management said that besides the Cloudera Data Platform uncertainty, it has also seen some difficulty combining sales forces and securing license renewals following the Hortonworks merger. But executives also insisted the company has addressed many of these issues to improve its results in the second half of this year.
Nonetheless, Cloudera's trio of worrisome developments left skittish investors little reason to hang on to the stock last month. And the company now needs to prove its recent headwinds aren't more than a blip in its long-term story.