Nutanix Plunges As Cloud Software Maker’s Revenue Outlook Misses

Nutanix Plunges As Cloud Software Maker’s Revenue Outlook Misses

Nutanix (NTNX) reported third-quarter earnings and revenue that beat consensus estimates. July quarter revenue guidance for Nutanix stock came in well below expectations, sending shares tumbling.




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Published after the close Wednesday, Nutanix’s profit for the quarter ended April 30 was 28 cents per share on an adjusted basis, compared with 4 cents a year earlier. That beat estimates for adjusted profit of 17 cents.

The maker of cloud computing network management software said revenue in NTNX stock rose 17% to $524.6 million, ahead of sales forecasts of $516 million.

For the current quarter ending in July, Nutanix expects revenue between $530 million and $540 million, well below estimates of $546 million.

Nutanix Stock: Big Trades Are a Factor

At RBC Capital, analyst Matthew Hedberg said in a report: “Management noted uncertainty over the timing of large transactions and a modest extension of sales.”

Additionally, third-quarter free cash flow came in at $78.3 million, below estimates of $85.5 million.

“Current guidance includes the impact of increasing variability management has seen regarding larger transactions in progress, reflecting new bookings and expansions below management’s expectations,” William Blair analyst Jason Ader said. in a report.

He added: “The full-year forecast assumes a modest impact from the VMware displacement opportunity and the development of OEM partnerships, both of which are expected to have a greater impact in fiscal 2025.”

On the stock market todayNTNX stock fell 17.5% to 60.44 in morning trading.

NTNX Stock: Key Metric is Strong

An important metric for Nutanix stock is subscription contracts and recurring revenue reported as annual contract value billings.

In the fiscal third quarter, ACV billings increased 20% to $288.9 million, compared to estimates of $271.5 million.

Additionally, Nutanix’s software manages network, storage and server infrastructure on cloud computing platforms. Nutanix competes with Broadcom(AVGO) VMware unit, Hewlett Packard Company (HPE) And Dell Technologies (DELL).

Meanwhile, Nutanix stock has gained 51% in 2024. NTNX stock is trading above a 5% buy zonewith a access point of 66.98.

The stock holds a relative strength rating of 97 out of the best possible 99, according to Checking ITN stocks.

Additionally, Nutanix has moved to a software subscription business model from selling hardware appliances.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.

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