Why Responsys Shares Skyrocketed

Is this meaningful, or just another movement?

Evan Niu
Evan Niu, CFA
Feb 21, 2013 at 3:29PM
Technology and Telecom

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Responsys (UNKNOWN:MKTG.DL) have skyrocketed today by as much as 25% after the company reported better-than-expected earnings.

So what: Revenue in the fourth quarter came in at $44.7 million, most of which was subscription revenue, and topped the consensus estimate of $42.5 million. Non-GAAP net income was $3.7 million, or $0.07 per share, also ahead of Street forecasts of $0.05 per share in adjusted profit. CEO Dan Springer said the company continues to benefit from the shift away from mass marketing.

Now what: Guidance was also healthy, with first-quarter sales expected in the range of $43 million to $45 million. Fiscal 2013 sales should be $188 million to $192 million, with adjusted earnings per share of $0.16 to $0.18. That outlook is somewhat mixed, as the Street was modeling for just $185.8 million in sales but expecting more down below. The consensus estimate for fiscal 2013 adjusted earnings per share is $0.22.

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