Smartsheet (SMAR) Q2 Earnings: What To Expect

Jabin Bastian /
2022/08/31 5:13 am EDT

Project management software maker Smartsheet (NYSE:SMAR) will be announcing earnings results tomorrow after market hours. Here's what you need to know.

Last quarter Smartsheet reported revenues of $168.3 million, up 43.7% year on year, beating analyst revenue expectations by 3.53%. It was a mixed quarter for the company, with an exceptional revenue growth but decelerating growth in large customers. The company added 729 enterprise customers paying more than $5,000 annually to a total of 15,879.

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

This quarter analysts are expecting Smartsheet's revenue to grow 37% year on year to $180.5 million, slowing down from the 44.4% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.20 per share.

Smartsheet 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 4.34%.

Looking at Smartsheet's peers in the productivity software segment, some of them have already reported Q2 earnings results, giving us a hint of what we can expect. Atlassian delivered top-line growth of 35.7% year on year, beating analyst estimates by 4.91% and monday.com reported revenues up 75.2% year on year, exceeding estimates by 4.65%. Atlassian traded up 9.13% on the results, monday.com was up 20.8%. Read our full analysis of Atlassian's results here and monday.com's results here.

There has been positive sentiment among investors in the software segment, with the stocks up on average 2.33% over the last month. Smartsheet is up 12.2% during the same time, and is heading into the earnings with analyst price target of $54.1, compared to share price of $33.08.

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.