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Momentive (NASDAQ:MNTV) Reports Q4 In Line With Expectations


Jabin Bastian /
2023/02/16 4:26 pm EST
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Online survey platform Momentive (NASDAQ:MNTV) reported results in line with analyst expectations in Q4 FY2022 quarter, with revenue up 4.3% year on year to $122.4 million. Momentive made a GAAP loss of $3.63 million, improving on its loss of $41.5 million, in the same quarter last year.

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

Momentive (MNTV) Q4 FY2022 Highlights:

  • Revenue: $122.4 million vs analyst estimates of $121.3 million (0.9% beat)
  • EPS (non-GAAP): $0.14 vs analyst estimates of $0.10 (40% beat)
  • Free cash flow of $6.62 million, up from $177 thousand in previous quarter
  • Customers: 887,400, down from 897,500 in previous quarter
  • Gross Margin (GAAP): 84%, down from 92.3% same quarter last year
  • For the first quarter of 2023, Momentive expects revenue growth 0% to 2% (year-over-year)

“Our fourth quarter results illustrate our continued execution against our top priorities: driving meaningful operating leverage and positioning the company for more profitable growth,” said Zander Lurie, chief executive officer of Momentive.

Previously known as SurveyMonkey, Momentive (NASDAQ:MNTV) offers software as a service that makes it easy for users create, manage and distribute online surveys.

The Internet has given customers more choice on whom to conduct business with and has also given them the power to easily share their experiences with other customers. These twin dynamics effectively have increased pressure on companies to both improve their customer service and also monitor their brand reputation online, driving the need for customer experience software offerings.

Sales Growth

As you can see below, Momentive's revenue growth has been mediocre over the last two years, growing from quarterly revenue of $101 million in Q4 FY2020, to $122.4 million.

Momentive Total Revenue

Momentive's quarterly revenue was only up 4.3% year on year, which might disappoint some shareholders. And the growth did slow down a little compared to last quarter, as Momentive increased revenue by $1.02 million in Q4, compared to $1.21 million revenue add in Q3 2022. We'd like to see revenue increase by a greater amount each quarter, but a one-off fluctuation is usually not concerning.

In volatile times like these we look for robust businesses with strong pricing power. Unknown to most investors, this company is one of the highest-quality software companies in the world, and their software products have been the default standard in critical industries for decades. The result is an impressive business that is up an incredible 18,152% since the IPO. You can find it on our platform for free.

Customer Growth

You can see below that Momentive reported 887,400 customers at the end of the quarter, a decrease of 10100 on last quarter. That is suggesting that the customer acquisition momentum is slowing a little bit. 

Momentive Customers

Key Takeaways from Momentive's Q4 Results

With a market capitalization of $1.22 billion Momentive is among smaller companies, but its more than $202.8 million in cash and positive free cash flow over the last twelve months put it in a very strong position to invest in growth.

It was good to see Momentive improve their gross margin this quarter. On the other hand, revenue growth was quite weak and the number of customers declined. Zooming out, we think this was still a decent, albeit mixed, quarter, showing the company is staying on target. The company is up 3.44% on the results and currently trades at $8.11 per share.

Should you invest in Momentive 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.

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.

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