The 10-second takeaway
For the quarter ended June 30 (Q2), NetSuite beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP loss per share contracted.
Gross margins shrank, operating margins increased, net margins improved.
NetSuite booked revenue of $74.7 million. The 22 analysts polled by S&P Capital IQ looked for revenue of $73.4 million on the same basis. GAAP reported sales were 29% higher than the prior-year quarter's $57.8 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.06. The 21 earnings estimates compiled by S&P Capital IQ forecast $0.04 per share. GAAP EPS were -$0.14 for Q2 compared to -$0.15 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 69.1%, 70 basis points worse than the prior-year quarter. Operating margin was -12.2%, 400 basis points better than the prior-year quarter. Net margin was -13.3%, 360 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $76.8 million. On the bottom line, the average EPS estimate is $0.05.
Next year's average estimate for revenue is $300.2 million. The average EPS estimate is $0.21.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 222 members out of 302 rating the stock outperform, and 80 members rating it underperform. Among 73 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 45 give NetSuite a green thumbs-up, and 28 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on NetSuite is hold, with an average price target of $44.28.
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