Earnings results often give us a good indication what direction will the company take in the months ahead. With Q4 now behind us, let’s have a look at Cloudflare (NYSE:NET) and its peers.
Software is eating the world, as Marc Andreessen says, and there is virtually no industry left that has been untouched by it. That in turn drives increasing demand for tools that help software developers do their jobs, whether it is monitoring critical cloud infrastructure, integrating audio and video functionality or ensuring smooth streaming of content.
The 14 software development stocks we track reported a slower Q4; on average, revenues beat analyst consensus estimates by 3.04%, while on average next quarter revenue guidance was 1.28% under consensus. Technology stocks have been hit hard on fears of higher interest rates as investors search for near-term cash flows, but software development stocks held their ground better than others, with the share prices up 1.05% since the previous earnings results, on average.
Cloudflare (NYSE:NET)
Founded by two grad students of Harvard Business School, Cloudflare (NYSE:NET) is a software as a service platform that helps improve security, reliability and loading times of internet applications and websites.
Cloudflare reported revenues of $274.7 million, up 41.9% year on year, in line with analyst expectations. It was a mixed quarter for the company, with exceptional revenue growth but underwhelming guidance for the next year.
"In the fourth quarter, we delivered record operating profit, operating margin, and free cash flow. We also surpassed more than 2,000 large customers paying us over $100,000 per year and signed a record number of deals greater than $500,000," said Matthew Prince, co-founder & CEO of Cloudflare.
The stock is up 6.43% since the results and currently trades at $61.94.
Is now the time to buy Cloudflare? Access our full analysis of the earnings results here, it's free.
Best Q4: Sumo Logic (NASDAQ:SUMO)
Founded in 2010 by Christian Beegden who went from driving a cab in Germany to landing an internship at Amazon, Sumo Logic (NASDAQ:SUMO) is software as a service data analytics platform that helps companies get insight into what is happening in their servers and applications.
Sumo Logic reported revenues of $79 million, up 27.3% year on year, beating analyst expectations by 6.41%. It was a very strong quarter for the company, with a significant improvement in gross margin and a solid beat of analyst estimates.
Sumo Logic pulled off the highest full year guidance raise among its peers. The stock is up 66.4% since the results and currently trades at $11.98.
Is now the time to buy Sumo Logic? Access our full analysis of the earnings results here, it's free.
Weakest Q4: Agora (NASDAQ:API)
Founded in 2014 by former engineers at WebEx and based in China, Agora (NASDAQ:API) provides a cloud platform that makes it easy for developers to integrate real-time audio and video functionalities in their apps.
Agora reported revenues of $40.1 million, down 0.66% year on year, missing analyst expectations by 1.12%. It was a weak quarter for the company, with full year guidance missing analysts' expectations and slow revenue growth.
Agora had the weakest performance against analyst estimates and slowest revenue growth in the group. The company added 79 customers to a total of 3,066. The stock is down 5.74% since the results and currently trades at $3.61.
Read our full analysis of Agora's results here.
JFrog (NASDAQ:FROG)
With the name chosen due to the founders' fondness for frogs, JFrog (NASDAQ:FROG) provides software as a service platform that makes developing and releasing software easier and faster, especially for large teams.
JFrog reported revenues of $76.5 million, up 29.2% year on year, missing analyst expectations by 0.58%. It was a weak quarter for the company, with revenue guidance for the next quarter and the full year missing analysts' expectations.
The company added 40 enterprise customers paying more than $100,000 annually to a total of 736. The stock is down 17% since the results and currently trades at $19.9.
Read our full, actionable report on JFrog here, it's free.
Twilio (NYSE:TWLO)
Founded in 2008 by Jeff Lawson, a former engineer at Amazon, Twilio (NYSE:TWLO) is a software as a service platform that makes it really easy for software developers to use text messaging, voice calls and other forms of communication in their apps.
Twilio reported revenues of $1.02 billion, up 21.6% year on year, beating analyst expectations by 2.43%. It was a slower quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in net revenue retention rate.
The company added 10,000 customers to a total of 290,000. The stock is up 0.68% since the results and currently trades at $66.52.
Read our full, actionable report on Twilio here, it's free.
The author has no position in any of the stocks mentioned