Coupa Software (COUP) Exceeds First Quarter Earnings and Revenue Estimates

ByLance T. Lee

Jun 7, 2022

Coupa Software Embedded COUP reported strong results for the first quarter of fiscal 2023, beating both revenue and net income estimates. The strong results were supported by Coupa providing businesses with visibility and control over their business spend, resilience in back-office operations, and support for strategic, data-driven decision-making to drive positive outcomes for their business.

Quarter details

Reported GAAP net loss in the quarter, attributable to Coupa Software Incorporated, was $81.5 million or $1.08 per share, compared to $100.4 million or $1.38 per share in the prior quarter. ‘last year. Non-GAAP net income in the quarter was $5.5 million or 8 cents per share, compared to $5 million or 7 cents per share in the year-ago quarter, beating the consensus estimate of Zacks of 3 cents.

Revenue in the reported quarter was $196.4 million, compared to $166.9 million in the prior year quarter, reflecting 17.6% year-on-year growth and beating the estimate of the Zacks consensus of $196 million. Growth was supported by the success of the Antares application, which offers customers the flexibility to access supplier risk at the time of procurement, monitor third-party data and provide instant visibility into risk scores vendor.

Reported subscription revenue in the quarter was $178.5 million from $140.1 million, reflecting growth of 27.4% over the prior year quarter. Growth was supported by the strengthening of the US dollar against the euro. Professional services revenue for the quarter was $17.9 million compared to $26.8 million, reflecting a 33.2% decline.

Coupa Software, Inc. Price, Consensus, and EPS Surprise

Coupa Software, Inc. price-consensus-eps-surprise-chart | Coupa Software, Inc. Quote

Operation details

Gross profit in the quarter was reported at $115.5 million, compared to $87.2 million in the prior year quarter, reflecting growth of 32.4%. GAAP operating loss in the quarter was $71.3 million, compared to $73.9 million in the prior year quarter. Non-GAAP operating profit for the quarter was $13.8 million, compared to $7 million in the prior quarter.

Cash flow and liquidity

In the first fiscal quarter, the company generated operating cash flow of $49.7 million, compared to $32.1 million in the prior year quarter. As of April 30, 2022, the company had $493.9 million in cash and cash equivalents with net convertible senior notes of $2,157.9 million.

Tips

For fiscal 2023, the company raised its revenue forecast from $836-840 million to $838-848 million. Subscription revenue is expected to be between $762 million and $767 million. Professional services and other income is expected to be approximately $76 million. Non-GAAP earnings are expected to be between 21 and 27 cents per share.

For the second quarter of fiscal 2023, total revenue is expected to be between $202 million and $205 million. Subscription revenue is expected to be between $185 million and $188 million, and professional and other services revenue is expected to be approximately $17 million. Non-GAAP net income is expected to be between 7 and 10 cents per share.

Zacks Ranking and Stocks to Consider

Coupa Software currently carries a Zacks rank #3 (Hold). You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Aspen Technology, Inc. AZPN, part of the broader Zacks IT and Technology sector, currently sports a Zacks No. 1 rank. AZPN forecasts long-term earnings growth of 7.94%.

Aspen Technology has seen accelerated adoption of its solutions that has driven revenue growth over the years. The company has a strong pipeline of new business bookings. It continues to innovate and improve its operations.

2U, Inc. TWOU, currently carrying a Zacks Rank #2 (Buy), is a key pick for stock investors. TWOU forecasts long-term earnings growth of 20%.

2U is an educational technology company and provider of cloud-based software-as-a-service (SaaS) solutions that enable nonprofit colleges and universities to deliver education to students around the world.

Asana, Inc. ASAN also carries a Zacks Rank #2 at present. It announced a surprise profit of 1.56%, on average, over the past four quarters.

Asana provides a SaaS work management platform that empowers individuals and teams to work efficiently.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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