Unpacking Q3 Earnings: Confluent (NASDAQ:CFLT) In The Context Of Other Data Infrastructure Stocks
Let's dig into the relative performance of Confluent (NASDAQ:CFLT) and its peers as we unravel the now-completed Q3 data infrastructure earnings season.
Generating insights from system level data is an increasing priority for most businesses, but to do so requires connecting and analyzing piles of data stored and siloed in separate databases. This is the demand driver for cloud based data infrastructure software providers, who can more readily integrate, distribute and process information vs. legacy on-premise software providers.
The 4 data infrastructure stocks we track reported a weaker Q3; on average, revenues beat analyst consensus estimates by 0.9% while next quarter's revenue guidance was 1.7% below consensus. Valuation multiples for growth stocks have reverted to their historical means after reaching highs in early 2021, but data infrastructure stocks held their ground better than others, with the share prices up 5.2% on average since the previous earnings results.
Confluent (NASDAQ:CFLT)
Started in 2014 by the team of engineers at LinkedIn who originally built it as an internal tool, Confluent (NASDAQ:CFLT) provides infrastructure software for organizations that makes it easy and fast to collect and move large amounts of data between different systems.
Confluent reported revenues of $200.2 million, up 31.9% year on year, topping analyst expectations by 2.6%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and decelerating growth in large customers.
Confluent pulled off the biggest analyst estimates beat and fastest revenue growth, but had the weakest full-year guidance update of the whole group. The company added 41 enterprise customers paying more than $100,000 annually to reach a total of 1,185. The stock is down 21.8% since the results and currently trades at $21.99.
Read our full report on Confluent here, it's free.
Best Q3: Teradata (NYSE:TDC)
Part of point-of-sale and ATM company NCR from 1991 to 2007, Teradata (NYSE:TDC) offers a software-as-service platform that helps organizations manage their data across multiple storages and analyze it.
Teradata reported revenues of $438 million, up 5% year on year, in line with analyst expectations. It was a decent quarter for the company. Although Teradata's EPS guidance for next quarter beat analysts' expectations, its adjusted operating income and free cash flow missed Wall Street's estimates.
Teradata had the slowest revenue growth among its peers. The stock is up 6.7% since the results and currently trades at $48.
Is now the time to buy Teradata? Access our full analysis of the earnings results here, it's free.
Weakest Q3: C3.ai (NYSE:AI)
Founded in 2009 by enterprise software veteran Tom Seibel, C3.ai (NYSE:AI) provides software that makes it easy for organizations to add artificial intelligence technology to their applications.
C3.ai reported revenues of $73.23 million, up 17.3% year on year, falling short of analyst expectations by 1.5%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.
C3.ai had the weakest performance against analyst estimates in the group. The stock is down 14.6% since the results and currently trades at $24.9.
Read our full analysis of C3.ai's results here.
Elastic (NYSE:ESTC)
Started by Shay Banon as a search engine for his wife's growing list of recipes at Le Cordon Bleu cooking school in Paris, Elastic (NYSE:ESTC) helps companies integrate search into their products and monitor their cloud infrastructure.
Elastic reported revenues of $310.6 million, up 17.5% year on year, surpassing analyst expectations by 2.2%. It was a mixed quarter for the company, with a decent beat of analysts' revenue estimates but decelerating customer growth.
Elastic achieved the highest full-year guidance raise among its peers. The company added 30 enterprise customers paying more than $100,000 annually to reach a total of 1,220. The stock is up 50.6% since the results and currently trades at $120.99.
Read our full, actionable report on Elastic here, it's free.
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The author has no position in any of the stocks mentioned
