As productivity software stocks’ Q1 earnings season wraps, let's dig into this quarters’ best and worst performers, including Dropbox (NASDAQ:DBX) and its peers.
Rising employee costs and the shift to more remote work has increased the ever-present pressure to improve corporate productivity, which in turn has driven rising demand for productivity software that enables remote work, streamline project management and automate business tasks.
The 16 productivity software stocks we track reported a mixed Q1; on average, revenues beat analyst consensus estimates by 3.36%, while on average next quarter revenue guidance was 1.53% above consensus. There has been a stampede out of high valuation technology stocks and while some of the productivity software stocks have fared somewhat better, they have not been spared, with share price declining 10.2% since earnings, on average.
Founded by the long-serving CEO Drew Houston and Arash Ferdowsi in 2007, Dropbox (NASDAQ:DBX) provides a file hosting cloud platform that helps organizations collaborate and share documents.
Dropbox reported revenues of $562.4 million, up 9.92% year on year, in line with analyst expectations. It was a decent quarter for the company, with a meaningful improvement in gross margin.
“2022 is off to a strong start as we launched new functionality and features across Backup, Shop and document workflows with HelloSign, DocSend and PDF editing; all designed to help customers organize, secure, and do more with their digital content,” said Dropbox Co-Founder and Chief Executive Officer Drew Houston.
Dropbox delivered the slowest revenue growth of the whole group. The company added 300,000 customers to a total of 17,090,000. The stock is down 3.7% since the results and currently trades at $20.54.
Best Q1: monday.com (NASDAQ:MNDY)
Founded in Israel in 2014, and named after the dreaded first day of the work week, Monday.com (NASDAQ:MNDY) makes software as a service platforms that helps teams plan and track work efficiently.
monday.com reported revenues of $108.4 million, up 83.9% year on year, beating analyst expectations by 7.09%. It was a very strong quarter for the company, with a very optimistic guidance for the next quarter and an exceptional revenue growth.
monday.com achieved the fastest revenue growth and highest full year guidance raise among its peers. The company added 167 enterprise customers paying more than $50,000 annually to a total of 960. The stock is down 5.74% since the results and currently trades at $104.
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Weakest Q1: RingCentral (NYSE:RNG)
Founded in 1999 during the dot-com era, RingCentral (NYSE:RNG) provides software as a service that unifies phone, text, fax, video calls and chat in one platform.
RingCentral reported revenues of $467.6 million, up 32.7% year on year, beating analyst expectations by 2.02%. It was a weaker quarter for the company, with a full year guidance missing analysts' expectations and a decline in gross margin.
RingCentral had the weakest full year guidance update in the group. The stock currently trades at $50.77.
Founded in 2008 by Facebook’s co-founder Dustin Moskovitz, Asana (NYSE:ASAN) is a cloud-based project management software, where you can plan and assign tasks to employees and monitor and discuss progress of work.
Asana reported revenues of $120.6 million, up 57.3% year on year, beating analyst expectations by 4.8%. It was a strong quarter for the company, with an exceptional revenue growth and guidance for the next quarter above analysts' estimates.
The company added 1,252 enterprise customers paying more than $5,000 annually to a total of 16,689. The stock is down 24.7% since the results and currently trades at $18.21.
Founded by Matt Calkins and his three friends out of an apartment in Northern Virginia, Appian (NASDAQ:APPN) sells a software platform that lets its users build applications without using much code, allowing them to create new software more quickly.
Appian reported revenues of $114.2 million, up 28.5% year on year, beating analyst expectations by 6.6%. It was a strong quarter for the company, with a solid beat of analyst estimates.
The stock is down 6.83% since the results and currently trades at $44.
The author has no position in any of the stocks mentioned