WalkMe (WKME) To Report Earnings Tomorrow: Here Is What To Expect

Radek Strnad /
2023/05/16 6:48 am EDT

User support software provider WalkMe (NASDAQ: WKME) will be reporting earnings tomorrow before market open. Here's what you need to know.

Last quarter WalkMe reported revenues of $64.9 million, up 21.8% year on year, beating analyst revenue expectations by 1.34%. It was a weak quarter for the company, with full year revenue guidance missing analysts' expectations.

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

This quarter analysts are expecting WalkMe's revenue to grow 14.4% year on year to $65.0 million, slowing down from the 33.3% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.11 per share.

WalkMe 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 has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 1.93%.

Looking at WalkMe's peers in the sales and marketing software segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. Shopify delivered top-line growth of 25.3% year on year, beating analyst estimates by 5.06% and DoubleVerify reported revenues up 26.7% year on year, exceeding estimates by 3.78%. Shopify traded up 21.2% on the results, DoubleVerify was up 5,92%. Read our full analysis of Shopify's results here and DoubleVerify's results here.

There is still much uncertainty in the markets. The Federal Reserve's hawkish stance on rates, meant to tame inflation, remains a key market narrative. There is an added wrinkle now with troubles in the banking sector, triggered by Silicon Valley Bank's fairly sudden and surprising collapse. Given these, the question is whether higher rates (which dampen economic activity) and potentially less lending from the overall banking sector will trigger a recession. While some tech stocks have recovered year-to-date, most are still well off their 52-week highs. WalkMe is down 17.1% over the last month, and is heading into the earnings with analyst price target of $13.6, compared to share price of $8.8.

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.