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 Bandwidth (NASDAQ:BAND).
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 0.03% 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 16.6% since the previous earnings results, on average.
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 $148.3 million, up 13.5% year on year, beating analyst expectations by 5.32%. It was a strong quarter for the company, with accelerating customer growth and a significant improvement in gross margin.
"We exceeded our guidance ranges for the third quarter and raised our full-year outlook on both the top and bottom lines," said David Morken, Bandwidth's Chief Executive Officer.
The stock is up 87.9% since the results and currently trades at $23.15.
Is now the time to buy Bandwidth? Access our full analysis of the earnings results here, it's free.
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 delivered 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 10.4% since the results and currently trades at $29.42.
Is now the time to buy HashiCorp? Access our full analysis of the earnings results here, it's free.
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 a full year guidance missing analysts' expectations.
Agora had the weakest performance against analyst estimates, declining revenue, and weakest full year guidance update in the group. The company added 110 customers to a total of 2,987. The stock is up 31.8% since the results and currently trades at $4.41.
Read our full analysis of Agora's results here.
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 $436.5 million, up 61.3% year on year, beating analyst expectations by 5.37%. It was a decent quarter for the company, with exceptional revenue growth but a decline in gross margin.
The company added 180 enterprise customers paying more than $100,000 annually to a total of 2,600. The stock is up 0.02% since the results and currently trades at $74.50.
Read our full, actionable report on Datadog 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 4.89% since the results and currently trades at $88.00.
Read our full, actionable report on Akamai here, it's free.
The author has no position in any of the stocks mentioned