Earnings To Watch: JFrog (FROG) Reports Q3 Results Tomorrow

Anthony Lee /
2023/10/31 4:28 am EDT

Software development tools maker JFrog (NASDAQ:FROG) will be announcing earnings results tomorrow after market close. Here's what to look for.

Last quarter JFrog reported revenues of $84.2 million, up 24.1% year on year, beating analyst revenue expectations by 1.41%. It was a slower quarter for the company, with decelerating growth in large customers and its net revenue retention rate in jeopardy. The company added 28 enterprise customers paying more than $100,000 annually to a total of 813.

Is JFrog buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting JFrog's revenue to grow 21.6% year on year to $87.6 million, slowing down from the 34.1% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.08 per share.

JFrog Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 2.06%.

Looking at JFrog's peers in the software development segment, only F5 Networks has so far reported results, delivering top-line growth of 0.99% year on year, and beating analyst estimates by 0.67%. The stock traded up 2.25% on the results.

Read our full analysis of F5 Networks's earnings results here.

Tech stocks have had a rocky start since 2022 and while some of the software development stocks have fared somewhat better, they have not been spared, with share price declining 8.09% over the last month. JFrog is down 16.1% during the same time, and is heading into the earnings with analyst price target of $33.3, compared to share price of $21.4.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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The author has no position in any of the stocks mentioned.