The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how JFrog (NASDAQ:FROG) and the rest of the software development stocks fared in Q3.
As legendary VC investor Marc Andreessen says, "Software is eating the world", and it touches virtually every industry. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming.
The 12 software development stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.4% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Best Q3: JFrog (NASDAQ:FROG)
Named after the amphibian that continuously evolves from egg to tadpole to adult, JFrog (NASDAQ:FROG) provides a platform that helps organizations securely create, store, manage, and distribute software packages across any system.
JFrog reported revenues of $136.9 million, up 25.5% year on year. This print exceeded analysts’ expectations by 6.6%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.
“JFrog has become the system of record for how modern software is built, secured, and deployed; the foundation of enterprise software supply chains in the era of AI,” said Shlomi Ben Haim, CEO and Co-founder of JFrog.
JFrog pulled off the biggest analyst estimates beat of the whole group. The company added 45 enterprise customers paying more than $100,000 annually to reach a total of 1,121. Unsurprisingly, the stock is up 27.7% since reporting and currently trades at $60.34.
Fastly (NYSE:FSLY)
Taking its name from the core advantage it delivers to customers, Fastly (NYSE:FSLY) operates an edge cloud platform that processes, secures, and delivers web content as close to end users as possible, enabling faster digital experiences.
Fastly reported revenues of $158.2 million, up 15.3% year on year, outperforming analysts’ expectations by 4.7%. The business had an exceptional quarter with EPS guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 24.5% since reporting. It currently trades at $10.05.
Is now the time to buy Fastly? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: Nutanix (NASDAQ:NTNX)
Originally pioneering hyperconverged infrastructure to break down traditional data center silos, Nutanix (NASDAQ:NTNX) provides a unified software platform that enables organizations to run applications and manage data across private, public, and hybrid cloud environments.
Nutanix reported revenues of $670.6 million, up 13.5% year on year, falling short of analysts’ expectations by 0.9%. It was a softer quarter as it posted full-year revenue guidance missing analysts’ expectations significantly and revenue guidance for next quarter missing analysts’ expectations significantly.
Nutanix delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 12.5% since the results and currently trades at $52.07.
Read our full analysis of Nutanix’s results here.
Twilio (NYSE:TWLO)
Known for the clever "Twilio Magic" demo that had developers creating functioning communications apps in minutes, Twilio (NYSE:TWLO) provides a platform that enables businesses to communicate with their customers through voice, messaging, email, and other digital channels.
Twilio reported revenues of $1.3 billion, up 14.7% year on year. This result beat analysts’ expectations by 3.8%. It was an exceptional quarter as it also logged accelerating customer growth and an impressive beat of analysts’ EBITDA estimates.
The company added 43,000 customers to reach a total of 392,000. The stock is up 24.1% since reporting and currently trades at $139.47.
Read our full, actionable report on Twilio here, it’s free for active Edge members.
Datadog (NASDAQ:DDOG)
Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ:DDOG) provides a software platform that helps organizations monitor and secure their cloud applications, infrastructure, and services.
Datadog reported revenues of $885.7 million, up 28.4% year on year. This number surpassed analysts’ expectations by 3.9%. Overall, it was an exceptional quarter as it also recorded a solid beat of analysts’ annual recurring revenue estimates and EPS guidance for next quarter exceeding analysts’ expectations.
The company added 210 enterprise customers paying more than $100,000 annually to reach a total of 4,060. The stock is down 11.5% since reporting and currently trades at $137.65.
Read our full, actionable report on Datadog here, it’s free for active Edge members.
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