NetSuite’s Q1 Beats Expectations; Shares Rise After Hours
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Shares of cloud business software supplier NetSuite rose by four percent in after-hours trading after the company reported first-quarter results that beat what analysts expected.
NetSuite reported earnings per share of six cents versus the consensus view of two cents, on revenue of $123 million, which rose 34 percent from the year-ago period. Analysts had expected sales of $121 million.
The company also boosted its revenue outlook for 2014 to between $540 million and $545 million, up from $535 million previously.
CEO Zach Nelson took his customary stab at rival SAP in a statement: “There is clearly a changing of the guard taking place in the ERP market as evidenced by NetSuite’s significant market share growth, and by the shrinking core license business of non-cloud ERP vendors such as SAP.”
ERP stands for Enterprise Resource Management, and in English it means software that handles all the crunchy details of managing a business day to day. Sixteen-year-old NetSuite has for years focused primarily on offering cloud-based ERP to small and medium-size businesses. But in recent years the size of its customers has gotten consistently bigger. And it has also expanded into new areas, including human resources software and retail point-of-sale systems.
NetSuite shares have, like those of other cloud companies, declined in recent weeks. Its shares peaked at $119.63, but as of today’s regular session closing the price had fallen by nearly 40 percent to $73.59.