Once-Hot IPOs Get Cooler Receptions After Earnings Reality Check
Eric Yuan, founder and chief executive officer of Zoom Video Communications Inc., center, celebrates during the company’s initial public offering (IPO) at the Nasdaq MarketSite in New York, U.S. (Photographer: Victor J. Blue/Bloomberg)

Once-Hot IPOs Get Cooler Receptions After Earnings Reality Check

(Bloomberg) -- Some of the hottest initial public offerings of the year are getting cooler receptions after earnings reports put some of the massive share gains in perspective.

As the S&P 500 Information Technology Index climbed higher on Friday, CrowdStrike Holdings Inc. and Zoom Video Communications Inc. were among recent debuts that saw triple-digit share price gains shrink after strong earnings reports. CrowdStrike sank as much as 13% despite revenue forecasts that topped the highest analyst estimates, while Zoom slipped 6.9% even though its results were widely praised.

Once-Hot IPOs Get Cooler Receptions After Earnings Reality Check

Slack Technologies Inc., a direct listing that surged 49% from its reference price in its first day of trading, has fallen 11% in the two days since reporting second-quarter earnings. The collaboration software company’s third-quarter sales forecast disappointed even though it exceeded the average analyst estimate at the midpoint.

Cloud software company Medallia Inc. dropped as much as 9.5% on Friday after an earnings report that William Blair called “solid.” The stock is still up 65% since its debut on July 18.

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