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 Q3. Today we are looking at the software development stocks, starting with Agora (NASDAQ:API).
Software is eating the world, as Marc Andreessen says, and there is virtually no industry left that has been untouched by it. That in turn drives increasing demand for tools that help software developers do their jobs, whether it is monitoring critical cloud infrastructure, integrating audio and video functionality or ensuring smooth streaming of content.
The 14 software development stocks we track reported a mixed Q3; on average, revenues beat analyst consensus estimates by 2.92%, while on average next quarter revenue guidance was 0.04% under consensus. Tech stocks have been under pressure as inflation makes their long-dated profits less valuable, but software development stocks held their ground better than others, with the share prices up 11% since the previous earnings results, on average.
Weakest Q3: Agora (NASDAQ:API)
Founded in 2014 by former engineers at WebEx and based in China, Agora (NASDAQ:API) 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 $40.9 million, down 8.99% year on year, missing analyst expectations by 7.83%. It was a weak quarter for the company, with full year guidance missing analysts' expectations.
“We delivered robust operational results this quarter despite a very challenging global macroeconomic environment,” said Tony Zhao, founder, chairman and CEO of Agora.
Agora delivered the weakest performance against analyst estimates, and weakest full year guidance update of the whole group. The company added 110 customers to a total of 2,987. The stock is up 30% since the results and currently trades at $4.35.
Best Q3: HashiCorp (NASDAQ:HCP)
Initially created as a research project at the University of Washington, HashiCorp (NASDAQ:HCP) provides software that helps companies operate their own applications in a multi-cloud environment.
HashiCorp reported revenues of $125.3 million, up 52.4% year on year, beating analyst expectations by 12.7%. It was a very strong quarter for the company, with an impressive beat of analyst estimates and exceptional revenue growth.
HashiCorp scored the strongest analyst estimates beat and highest full year guidance raise among its peers. The company added 26 enterprise customers paying more than $100,000 annually to a total of 760. The stock is up 9.65% since the results and currently trades at $29.2.
Is now the time to buy HashiCorp? Access our full analysis of the earnings results here, it's free.
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 $881.8 million, up 2.5% year on year, in line with analyst expectations. It was a weak quarter for the company, with slow revenue growth.
The stock is up 5.94% since the results and currently trades at $88.88.
Sumo Logic (NASDAQ:SUMO)
Founded in 2010 by Christian Beegden who went from driving a cab in Germany to landing an internship at Amazon, Sumo Logic (NASDAQ:SUMO) is software as a service data analytics platform that helps companies get insight into what is happening in their servers and applications.
Sumo Logic reported revenues of $78.9 million, up 27.3% year on year, beating analyst expectations by 6.4%. It was a very strong quarter for the company, with a significant improvement in gross margin.
The stock is up 8.33% since the results and currently trades at $7.80.
Founded as an open-source project in 2011, GitLab (NASDAQ:GTLB) is a leading software development tools platform.
GitLab reported revenues of $112.9 million, up 69.1% year on year, beating analyst expectations by 6.5%. It was a very strong quarter for the company, with exceptional revenue growth.
GitLab achieved the fastest revenue growth among the peers. The stock is up 22.2% since the results and currently trades at $46.87.
The author has no position in any of the stocks mentioned