Shares of Nutanix (NTNX +8.04%) were moving higher today after the hyper-converged infrastructure specialist (HCI) posted better-than-expected results in its fiscal fourth-quarter earnings report.
Investors responded positively to the news, sending the stock up 20.4% as of 12:53 p.m. ET.
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Nutanix bounces back
Following a disappointing earnings report in the fiscal third quarter, Nutanix bounced back after reassuring investors that customer adoption remains solid.
Revenue in the quarter rose 11% to $548 million, which topped the consensus at $536.9 million.
Other metrics showed underlying growth was even faster, as annual contract value (ACV) billings were up 21% to $338 million, and annual recurring revenue increased 22%, showing that reported revenue should accelerate in the coming quarters. The company also expanded its gross margin by 150 basis points to 85.2%.
On the bottom line, adjusted operating income increased from $63.6 million to $70.5 million, and adjusted earnings per share rose from $0.24 to $0.27, ahead of the consensus at $0.20.
Free cash flow in the quarter surged from $45.5 million to $224.3 million due to significant growth in deferred revenue.
CEO Rajiv Ramaswami said, "Our fourth quarter was a solid finish to a fiscal year that showed good progress on our financial model, with solid top-line growth and sharp year-over-year improvement in profitability." He also noted new and expanded agreements with Cisco, Nvidia, and Dell.
NASDAQ: NTNX
Key Data Points
What's next for Nutanix?
Looking ahead to the fiscal first quarter, management called for revenue of $565 million-$575 million in the first quarter, which compared to the analyst consensus of $573.3 million. For the full year, it expects revenue of $2.435-$2.465 billion, in line with estimates of $2.45 billion, and up 14% at the midpoint.
With revenue accelerating and free cash flow ramping up, it's not surprising to see Nutanix moving higher on the news.
