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Splunk Reports Stronger-Than-Expected Earnings

In the latest quarter, Splunk posted revenue of $745 million, down 6% from a year earlier but ahead of analyst estimates.
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Splunk  (SPLK)  shares rose in after-hours trading Wednesday, after the data analysis software company reported stronger-than-expected earnings.

In the fiscal 2021 fourth quarter, Splunk posted revenue of $745 million, down 6% from $791 million a year earlier. The FactSet analyst consensus called for revenue of $677.5 million in the latest quarter.

Splunk registered a net loss of $139.6 million in the latest quarter, or 86 cents a share, widening from a loss off $22.7 million, or 15 cents per share, a year ago. Analysts predicted a loss of $1.07 a share for the latest quarter.

Splunk recently traded at $150, up 4.76%, but has slid 36% in the last six months.

“With annual recurring revenue growing 41% year-over-year and $810 million of cloud ARR accelerating to 83% growth, we are extremely proud of the team’s execution and the company’s business fundamentals, both of which remain strong,” Chief Financial Officer Jason Child said in a statement.

“As organizations continue to reinvent towards the cloud, I’m confident that our ability to support them across IT, security and developer operations positions Splunk for long-term success.”

For the fiscal 2022 first quarter ending April 30, 2021, Splunk estimates annual recurring revenue of $2.42 billion to $2.44 billion, total revenue of $480 million to $500 million and non-GAAP operating margin of about negative 30%.

Morningstar analyst Nupur Balain put fair value for Splunk at $208 before the earnings report.

“Splunk has been facing top-line pressure for some time,” she wrote in December. “However, we expect that as the cloud transition wraps up, the firm should see predictable, subscription-like revenue streams.”