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Q2 Rundown: Bandwidth (NASDAQ:BAND) Vs Other Software Development Stocks


Kayode Omotosho /
2021/10/19 8:51 am EDT
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Looking back on software development stocks' Q2 earnings, we examine this quarters’ best and worst performers, including Bandwidth (NASDAQ:BAND) and its peers.

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 11 software development stocks we track reported a decent Q2; on average, revenues beat analyst consensus estimates by 4.42%, while on average next quarter revenue guidance was 3.96% above consensus. On average the share price was down 0.12% the day after the earnings.

Bandwidth (NASDAQ:BAND)

Started in 1999 by David Morken who was later joined by Henry Kaestner as co-founder in 2001, 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 continued successful execution of our long term strategy is evident in the 57% year-over-year increase in CPaaS revenue, fueled by broad-based demand across all of our services and expanded global footprint," stated David Morken, Chief Executive Officer of Bandwidth.

Bandwidth Total Revenue

The stock is down 27.7% since the results and currently trades at $90.20.

Is now the time to buy Bandwidth? 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

The stock is up 37.3% since the results and currently trades at $157.80.

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

Weakest Q2: 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 $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.

The stock is down 6.72% since the results and currently trades at $27.58.

Read our full analysis of Agora's results here.

Cloudflare (NYSE:NET)

Founded by two grad students of Harvard Business School, Cloudflare (NYSE:NET) is a software as a service platform that helps improve security, reliability and loading times of internet applications and websites.

Cloudflare reported revenues of $152.4 million, up 52.8% year on year, beating analyst expectations by 4.33%. It was a very strong quarter for the company, with an exceptional revenue growth.

Cloudflare pulled off the highest full year guidance raise among the peers. The stock is up 49.2% since the results and currently trades at $180.90.

Read our full, actionable report on Cloudflare 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, slowest revenue growth, and weakest full year guidance update among the peers. The stock is down 10.6% since the results and currently trades at $107.

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

The author has no position in any of the stocks mentioned