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Jamf (NASDAQ:JAMF) Q3 Sales Beat Estimates, Next Quarter Growth Looks Optimistic


Kayode Omotosho /
2021/11/11 4:14 pm EST
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Apple device management company, Jamf (NASDAQ:JAMF) beat analyst expectations in Q3 FY2021 quarter, with revenue up 35.8% year on year to $95.6 million. Guidance for next quarter's revenue was $100 million at the midpoint, which is 1.19% above the analyst consensus. Jamf made a GAAP loss of $30.3 million, down on its loss of $5.09 million, in the same quarter last year.

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

Jamf (JAMF) Q3 FY2021 Highlights:

  • Revenue: $95.6 million vs analyst estimates of $93.7 million (2.01% beat)
  • EPS (non-GAAP): $0.01 vs analyst estimates of $0.01
  • Revenue guidance for Q4 2021 is $100 million at the midpoint, above analyst estimates of $98.8 million
  • Gross Margin (GAAP): 72.3%, down from 78.3% same quarter last year

“Throughout the year we’ve talked about the remarkable momentum, consistency and balance across our business, and Q3 was no exception, with 47% total ARR growth and 37% organic ARR growth, with growth in commercial markets continuing to accelerate,” said Dean Hager, CEO of Jamf.

Founded in 2002 by Zach Halmstad and Chip Pearson, right around the time when Apple began to dominate the personal computing market, Jamf (NASDAQ:JAMF) provides software for companies to manage Apple devices such as Macs, iPads, and iPhones.

As remote collaboration becomes mainstream due to COVID and enterprise digital transformation, more organizations are expected to depend on remote management software that makes it easy for IT admins to manage the increasing number of hardware devices.

Sales Growth

As you can see below, Jamf's revenue growth has been very strong over the last year, growing from quarterly revenue of $70.4 million, to $95.6 million.

Jamf Total Revenue

And unsurprisingly, this was another great quarter for Jamf with revenue up 35.8% year on year. On top of that, revenue increased $9.38 million quarter on quarter, a very strong improvement on the $5.07 million increase in Q2 2021, and a sign of re-acceleration of growth.

Analysts covering the company are expecting the revenues to grow 25.1% over the next twelve months, although estimates are likely to change post earnings.

There are others doing even better than Jamf. Founded by ex-Google engineers, a small company making software for banks has been growing revenue 90% year on year and is already up more than 400% since the IPO in December. You can find it on our platform for free.

Profitability

What makes the software as a service business so attractive is that once the software is developed, it typically shouldn't cost much to provide it as an ongoing service to customers. Jamf's gross profit margin, an important metric measuring how much money there is left after paying for servers, licenses, technical support and other necessary running expenses was at 72.3% in Q3.

Jamf Gross Margin (GAAP)

That means that for every $1 in revenue the company had $0.72 left to spend on developing new products, marketing & sales and the general administrative overhead. Despite it going down over the last year, this is still around the lower average of what we typically see in SaaS businesses. Gross margin has a major impact on a company’s ability to invest in developing new products and sales & marketing, which may ultimately determine the winner in a competitive market so it is important to track.

Key Takeaways from Jamf's Q3 Results

With a market capitalization of $5.17 billion Jamf is among smaller companies, but its more than $227.1 million in cash and positive free cash flow over the last twelve months put it in a very strong position to invest in growth.

We enjoyed seeing Jamf’s impressive revenue growth this quarter. And we were also excited to see that it outperformed analysts' revenue expectations. On the other hand, it was less good to see the pretty significant deterioration in gross margin. Zooming out, we think this was still a decent, albeit mixed, quarter, showing the company is staying on target. The company is up 0.51% on the results and currently trades at $41.48 per share.

Should you invest in Jamf right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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