The 10-second takeaway
For the quarter ended March 31 (Q1), NetSuite met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly. Non-GAAP earnings per share contracted. GAAP loss per share grew.
Margins contracted across the board.
NetSuite booked revenue of $91.6 million. The 23 analysts polled by S&P Capital IQ hoped for a top line of $91.0 million on the same basis. GAAP reported sales were 32% higher than the prior-year quarter's $69.3 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 $0.04. The 23 earnings estimates compiled by S&P Capital IQ averaged $0.03 per share. Non-GAAP EPS of $0.04 for Q1 were 33% lower than the prior-year quarter's $0.06 per share. GAAP EPS were -$0.18 for Q1 compared to -$0.11 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 67.6%, 240 basis points worse than the prior-year quarter. Operating margin was -14.4%, 410 basis points worse than the prior-year quarter. Net margin was -14.2%, 310 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $98.2 million. On the bottom line, the average EPS estimate is $0.02.
Next year's average estimate for revenue is $406.6 million. The average EPS estimate is $0.27.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 234 members out of 326 rating the stock outperform, and 92 members rating it underperform. Among 87 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 59 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 $73.83.
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