According to a recent market report, the global data visualization market was valued at $4.51 billion in 2017. It is expected to grow 9.5% annually to $7.76 billion by 2023. Data analytics firm Tableau (NYSE: DATA) is a leading player in the industry.
Tableau’s fourth quarter revenues fell 1% over the year to $249.4 million, ahead of the Street’s forecast of $240.25 million. Last year, Tableau had implemented a revised pricing structure across product lines that led to reduced upfront costs for its customers. While the revised pricing will lead to increased adoption of Tableau’s products in the future, short term revenues have been impacted. Adjusted earnings per share of $0.12 was significantly better than the market’s projected EPS of $0.03 for the quarter.
By segment, maintenance revenues grew 22% over the year to $120.12 million while licensing revenues fell 15% to $129.24 million. Ratable license bookings were 51% of total license bookings, compared to 20% a year ago.
It ended the year with revenues of $877.1 million and a net loss of $185.6 million, or $2.35 per share. Total annual recurring revenue grew 45% to $596.2 million. Subscription annual recurring revenue was $195.5 million, up 235% over the year and ratable license bookings were 41% of total license bookings, compared to 17% a year ago.
For the current quarter, Tableau estimated revenues of $212-$222 million, compared with the market’s forecast of $213.7 million. It expects an EPS of a loss of $0.24-$0.17 per share, compared with the Street’s estimate of a loss of $0.03 per share.
Tableau recently announced senior management changes. Its Chief Financial Officer, Tom Walker, announced plans to step down from his current role. The company also appointed Gerri Martin-Flickinger, chief technology officer for Starbucks, as a new director.
Tableau’s Product Expansion
During the quarter, Tableau continued to release upgraded products. It launched Hyper, its new in-memory data engine technology that provides customers up to five times faster query speed and up to three times faster extract creation speed. To support organizations using Linux, Tableau also delivered its Server on Linux with Tableau 10.5, that enables customers to combine Tableau’s analytics platform with Linux’s enterprise capabilities.
Tableau has been working on tie-ups with industry leaders. Through its tie-up with Deloitte, it recently launched Taxalytics. Taxalytics is a first-of-its-kind embedded analytics solution focused on tax departments. It integrates financial data and uses Tableau analytics technology to create user-friendly, customizable analytics dashboards for tax and finance departments.
Questions for Tableau’s Board
As I mentioned earlier, this is a period of unprecedented opportunity for SaaS players. To deliver industry focused SaaS solutions, Tableau appears to be entering strategic tie-ups. Last year, it tied up with GE Aviation digital solutions to gather data from GE’s fleet of engines to provide visual analytics across the aviation sector. The recently launched Taxalytics product is an example of another such innovation. What other innovations does Tableau have lined up? What other industries is it focusing on to bring its visualization tools to enterprises? And especially, how does Tableau plan to take advantage of the hyperactive startup activity in the tech industry right now, as I indicated in my article?
The market was pleased with Tableau’s performance. Its stock is trading at $83.28 with a market capitalization of $6.6 billion. It had fallen to a year low of $47.30 in March last year. It had reached a year high of $87 earlier last month.