Splunk Rises After Annual Recurring Sales View Tops Expectations
(Bloomberg) -- Splunk Inc. shares rose more than 5% in extended trading on Wednesday after the infrastructure software company projected third-quarter annual recurring revenue that was ahead of analyst expectations. It also reported second-quarter revenue that beat the average estimate.
For the third quarter, Splunk forecast revenue between $625 million and $650 million, along with total ARR of $2.8 billion and $2.825 billion and cloud ARR of $1.10 billion and $1.11 billion. Wall Street was looking for third-quarter revenue of $640.2 million, ARR of $2.78 billion, and cloud ARR of about $984.6 million, according to Bloomberg Consensus estimates.
Splunk reported second-quarter revenue of $606 million, compared with the analyst consensus of $563.0 million. Annual recurring revenue expanded 37% to $2.63 billion, while cloud ARR rose 72% from the year-ago period, to $976 million.
“We outperformed in the first half of the year and are well-positioned heading into the second half,” Chief Financial Officer Jason Child said in the earnings statement. The company expects $1.3 billion of Cloud ARR and total ARR of “well over” $3 billion by fiscal year end, he said.
Splunk shares rose 1.3% to close at $155.02 on Wednesday, the highest since February. The stock is up nearly 40% from a June low, although it is in negative territory for the year.
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