8x8 Q4 Earnings Report Preview: What To Look For

Jabin Bastian /
2022/02/01 5:57 am EST
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Business communications software company 8x8 (NYSE:EGHT) will be reporting results tomorrow after market hours. Here's what to look for.

Last quarter 8x8 reported revenues of $151.5 million, up 17.3% year on year, beating analyst revenue expectations by 2.39%. It was a slower quarter for the company, with a meaningful improvement in gross margin but decelerating growth in large customers.

Is 8x8 buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting 8x8's revenue to grow 12.6% year on year to $153.9 million, slowing down from the 15.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Earnings are expected to come in at $0.01 per share.

8x8 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 2.65%.

Looking at 8x8's peers in the productivity software segment, some of them have already reported Q4 earnings results, giving us a hint what we can expect. ServiceNow delivered top-line growth of 29% year on year, beating analyst estimates by 0.6% and Atlassian reported revenues up 37.3% year on year, exceeding estimates by 7.16%. ServiceNow traded up 9.6% on results, Atlassian was up 9.91%. Read our full analysis of ServiceNow's results here and Atlassian's results here.

Tech stocks have been facing declining investor sentiment in 2022 and while some of the productivity software stocks have fared somewhat better, they have not been spared, with share price declining 14.2% over the last month. 8x8 is down 13.3% during the same time, and is heading into the earnings with analyst price target of $30.2, compared to share price of $15.35.

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.