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Reflecting On Software Development Stocks’ Q2 Earnings: Agora (NASDAQ:API)


Kayode Omotosho /
2021/09/28 6:48 am EDT
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As the craze of earnings season draws to a close, here's a look back at some of the most exciting (and some less so) results from Q2. Today we are looking at the software development stocks, starting with Agora (NASDAQ:API).

The first shift towards voice communication over the internet (VOIP), rather than traditional phone networks, happened when the enterprises started replacing business phones with the cheaper VOIP technology. Today, the rise of the consumer internet has increased the need for two way audio and video functionality in applications, driving demand for software tools and platforms that enable developers to add this utility.

The 11 software development stocks we track reported a decent Q2; on average, revenues beat analyst consensus estimates by 5.83%, while on average next quarter revenue guidance was 6.52% above consensus. On average the share price was down 0.29% the day after the earnings.

Weakest Q2: Agora (NASDAQ:API)

Founded in 2014 by former engineers at WebEx and based in China, Agora provides a cloud platform that makes it easy for developers to integrate real-time audio and video functionalities in their apps.

Agora reported revenues of $42.3 million, up 24.8% year on year, beating analyst expectations by 2.56%. It was a weak quarter for the company, with a decline in net revenue retention rate and a full year guidance missing analysts' expectations.

“We have been a public company for one year now. Looking back at the past year, we are very proud to have helped people around the world stay connected during this challenging period. Together with developers on our platform, we are changing the way people work and study, and how people play and live their lives,” said Tony Zhao, founder, chairman and CEO of Agora.

Agora Total Revenue

The stock is down 1.31% since the results and currently trades at $29.10.

Is now the time to buy Agora? Access our full analysis of the earnings results here, it's free.

Best Q2: Datadog (NASDAQ:DDOG)

Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ:DDOG) is a software as a service platform that makes it easier to monitor cloud infrastructure and applications.

Datadog reported revenues of $233.5 million, up 66.8% year on year, beating analyst expectations by 9.93%. It was a very strong quarter for the company, with an exceptional revenue growth and a very optimistic guidance for the next quarter.

Datadog Total Revenue

Datadog delivered the fastest growth in large customers. The company added 173 enterprise customers paying more than $100,000 annually to a total of 1,610. The stock is up 14.8% since the results and currently trades at $138.60.

Is now the time to buy Datadog? Access our full analysis of the earnings results here, it's free.

Akamai (NASDAQ:AKAM)

Founded in 1999 by two engineers from MIT, Akamai (NASDAQ:AKAM) provides software for organizations to efficiently deliver web content to their customers.

Akamai reported revenues of $852.8 million, up 7.31% year on year, in line with analyst expectations. It was a weak quarter for the company, with a slow revenue growth.

Akamai had the weakest performance against analyst estimates and slowest revenue growth. The stock is down 6.11% since the results and currently trades at $108.81.

Read our full analysis of Akamai's results here.

Twilio (NYSE:TWLO)

Founded in 2008 by Jeff Lawson, a former engineer at Amazon, Twilio is a software as a service platform that makes it really easy for software developers to use text messaging, voice calls and other forms of communication in their apps.

Twilio reported revenues of $668.9 million, up 66.8% year on year, beating analyst expectations by 11.6%. It was a strong quarter for the company, with an impressive beat of analyst estimates.

Twilio achieved the strongest analyst estimates beat and fastest revenue growth (with Datadog coming very close second) among the peers. The stock is down 4.85% since the results and currently trades at $338.70.

Read our full, actionable report on Twilio here, it's free.

Bandwidth (NASDAQ:BAND)

Started by David Morken while on a paid leave from the Marines, Bandwidth (NASDAQ:BAND) provides thousands of customers with a software platform that uses its own global network to provide phone numbers, voice, and text connectivity.

Bandwidth reported revenues of $120.6 million, up 57.1% year on year, beating analyst expectations by 4.19%. It was a decent quarter for the company, with an exceptional revenue growth but a decline in net revenue retention rate.

The stock is down 3.98% since the results and currently trades at $100.25.

Read our full, actionable report on Bandwidth here, it's free.

The author has no position in any of the stocks mentioned