Shares in Smartsheet popped Friday on July-quarter earnings and revenue that beat estimates amid strong customer growth. SMAR stock climbed even though management lowered its 2022 outlook for billings growth.
"Customer adds were a bright spot in the quarter," Wolfe Research analyst Alex Zukin said in a note to clients.
Smartsheet surged 10.8% to close at 34.16 on the stock market today.
Reporting after the close Thursday, the enterprise software maker said it lost an adjusted 10 cents per share, narrowing its loss versus a year earlier. Revenue rose 42% to $186.7 million, said the Bellevue, Wash.-based company.
SMAR stock analysts expected the company to report a loss of 20 cents a share on revenue of $180.3 million. A year earlier, Smartsheet had a 5-cent loss on sales of $132 million.
Companies use Smartsheet's products to manage workflows and projects, and facilitate collaboration.
Billings Beat Estimates, But Guidance Lowered
Billings, a sales growth metric, climbed 44% to $205.6 million versus estimates of 36% growth.
"SMAR posted solid top-line results, with revenue and billings growth beating our consensus forecasts by 3% and 5%, respectively, despite macroeconomic headwinds," SMAR stock analyst Keith Bachman of BMO Capital Markets said in his note to clients.
For the current quarter ending in July, Smartsheet said it expects a loss in a range of 15 cents to 16 cents. Analysts had predicted a 14-cent loss. The maker of project management software forecasts revenue of $193.5 million, compared with estimates of $195 million.
Smartsheet lowered its full-year 2022 billings outlook to a range of $870 million to $880 million, down about 4% from earlier guidance.
"Smartsheet called out a lack of sales productivity due to a tougher macro environment starting in July," Jefferies analyst Brent Thill said in a note.
SMAR Stock Down 55% This Year
Heading into the Smartsheet earnings report, SMAR stock owned a Relative Strength Rating of 11 out of a possible 99, according to IBD Stock checkup. Also, SMAR stock has retreated 55% in 2022.
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