Q1 Earnings Highs And Lows: Yext (NYSE:YEXT) Vs The Rest Of The Sales And Marketing Software Stocks
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how sales and marketing software stocks fared in Q1, starting with Yext (NYSE:YEXT).
The Internet and the exploding amount of data have transformed how businesses interact with, market to, and transact with their customers. Personalization of offerings, e-commerce, targeted advertising and data-empowered sales teams are now table stakes for modern businesses, and sales and marketing software providers are becoming the tools of evolving customer interaction.
The 23 sales and marketing software stocks we track reported an ok Q1; on average, revenues beat analyst consensus estimates by 2.3%. while next quarter's revenue guidance was in line with consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and while some of the sales and marketing software stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.3% on average since the previous earnings results.
Yext (NYSE:YEXT)
Founded in 2006 by Howard Lerman, Yext (NYSE:YEXT) offers software as a service that helps their clients manage and monitor their online listings and customer reviews across all relevant databases, from Google Maps to Alexa or Siri.
Yext reported revenues of $95.99 million, down 3.5% year on year, in line with analysts' expectations. Overall, it was a slower quarter for the company with a miss of analysts' ARR (annual recurring revenue) estimates and underwhelming revenue guidance for the next quarter.
The stock is up 5.3% since reporting and currently trades at $5.32.
Read our full report on Yext here, it's free.
Best Q1: AppLovin (NASDAQ:APP)
Co-founded by Adam Foroughi, who was frustrated with not being able to find a good solution to market his own dating app, AppLovin (NASDAQ:APP) is both a mobile game studio and provider of marketing and monetization tools for mobile app developers.
AppLovin reported revenues of $1.06 billion, up 47.9% year on year, outperforming analysts' expectations by 8.6%. It was an exceptional quarter for the company with an improvement in its gross margin.
AppLovin pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 10.9% since reporting. It currently trades at $82.11.
Is now the time to buy AppLovin? Access our full analysis of the earnings results here, it's free.
Weakest Q1: Sprout Social (NASDAQ:SPT)
Founded by Justyn Howard and Aaron Rankin in 2010, Sprout Social (NASDAQ:SPT) provides a software as a service platform that companies can use to schedule and respond to posts on major social media networks like Twitter, Facebook, Instagram, Youtube and LinkedIn.
Sprout Social reported revenues of $96.78 million, up 28.7% year on year, in line with analysts' expectations. It was a weak quarter for the company with underwhelming revenue guidance for the next quarter and a miss of analysts' billings estimates.
Sprout Social had the weakest performance against analyst estimates and weakest full-year guidance update in the group. The company added 134 enterprise customers paying more than $10,000 annually to reach a total of 8,823. As expected, the stock is down 21.3% since the results and currently trades at $37.89.
Read our full analysis of Sprout Social's results here.
SEMrush (NYSE:SEMR)
Started by Oleg Shchegolev while still in university, Semrush (NYSE:SEMR) is a software as a service platform that helps companies optimize their search engine and content marketing efforts.
SEMrush reported revenues of $85.81 million, up 21.1% year on year, in line with analysts' expectations. Overall, it was a solid quarter for the company with accelerating customer growth and a decent beat of analysts' ARR (annual recurring revenue) estimates.
The company added 4,000 customers to reach a total of 112,000. The stock is up 5.1% since reporting and currently trades at $13.84.
Read our full, actionable report on SEMrush here, it's free.
Shopify (NYSE:SHOP)
Originally created as an internal tool for a snowboarding company, Shopify (NYSE:SHOP) provides a software platform for building and operating e-commerce businesses.
Shopify reported revenues of $1.86 billion, up 23.4% year on year, in line with analysts' expectations. Revenue aside, it was an ok quarter for the company with a significant improvement in its gross margin but a miss of analysts' billings estimates.
The stock is down 18.1% since reporting and currently trades at $63.12.
Read our full, actionable report on Shopify here, it's free.
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