Shares of CyberArk Software (CYBR 1.03%) have plunged today, down by 10% as of 12:30 p.m. EDT, after the company reported first-quarter earnings. The results easily beat the market's expectations, but the company's profit outlook disappointed investors.
Revenue in the first quarter was $112.8 million, compared to the consensus estimate of $109.9 million. That resulted in adjusted net income of $3.8 million, or $0.09 per share, meaningfully above the $0.03 per share in adjusted profits that Wall Street was forecasting. The identity security technology company finished the quarter with annual recurring revenue (ARR) of $288 million.
"With our strong first quarter performance and accelerating business momentum, 2021 is off to a great start," CEO Udi Mokady said in a release. "In early January, we formally kicked off our active transition to a recurring revenue model, and the execution of our strategy exceeded our expectations."
Effective in the first quarter, CyberArk revised how it presents revenue and cost of revenue to better align with how management evaluates the business. The company now breaks sales down by subscription revenue, perpetual license revenue, and services revenue, with corresponding line items for costs related to each category.
Outlook for the second quarter calls for revenue in the range of $111 million to $119 million, the midpoint of which is in line with the consensus estimate of $115.4 million. On an adjusted basis, the bottom line is forecast at negative $0.11 to positive $0.06 per share. Analysts are looking for $0.07 per share in adjusted profits.