What To Expect From SentinelOne’s (S) Q3 Earnings

Kayode Omotosho /
2023/12/04 2:01 am EST

Cyber security company SentinelOne (NYSE:S) will be announcing earnings results tomorrow after market hours. Here's what to expect.

Last quarter SentinelOne reported revenues of $149.4 million, up 45.8% year on year, beating analyst revenue expectations by 6%. It was a strong quarter for the company, with revenue and non-GAAP operating profit exceeding expectations. Next quarter's guidance was ahead, and the company raised full year guidance for revenue, non-GAAP gross margin, and non-GAAP operating margin. The company added 77 enterprise customers paying more than $100,000 annually to a total of 994.

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

This quarter analysts are expecting SentinelOne's revenue to grow 35.5% year on year to $156.3 million, slowing down from the 106% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.08 per share.

SentinelOne 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 only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 5.2%.

Looking at SentinelOne's peers in the cybersecurity segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. CrowdStrike delivered top-line growth of 35.3% year on year, beating analyst estimates by 1.1% and Varonis reported revenue decline of 0.8% year on year, missing analyst estimates by 2.5%. CrowdStrike traded down 1.4% on the results, Varonis was down 4.1%.

Read our full analysis of CrowdStrike's results here and Varonis's results here.

There has been positive sentiment among investors in the cybersecurity segment, with the stocks up on average 14.3% over the last month. SentinelOne is up 27.9% during the same time, and is heading into the earnings with analyst price target of $19.2, compared to share price of $19.8.

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.

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