Posted on Thursday, Jul 18th 2019
According to an IDC report published earlier this year,
the global revenues for big data and business analytics (BDA) solutions are estimated to grow from $189.1 billion in 2019 to $274.3 billion by 2022 at a CAGR of 13%. Cloud-based provider of BI tools Domo (NASDAQ: DOMO) is seeing strong growth in its revenue. Domo’s
Domo’s revenue for the quarter grew 28% over the year to $40.8 million, marginally ahead of the market’s forecast of $40.7 million. It ended the quarter with a non GAAP loss of $1.08 per share, better than the Street’s estimated loss of $1.28 per share.
Subscription revenue grew 29% to $34.4 million with billings growing 22% to $41.1 million. Professional services revenue grew 21% over the year to $6.4 million.
Among other metrics, 45% of its customers were on multi-year contracts at the end of first-quarter compared with 35% at the end of a year ago. Its enterprise customer base grew 19% to 458 enterprise customers and reported a 33% growth in revenue.
For the current quarter, Domo forecast revenue of $41-$42 million with a net loss of $0.98-$1.02 per share. It expects to end the year with revenue of $173-$174 million and a net loss of $3.79-$3.87 a share. The market was looking for revenue of $42.3 million for the quarter with a net loss of $1.
Domo’s Enterprise Focus
Domo continues to push the
adoption of its services to enterprise customers. As part of this move, it
piloted a new pricing model last quarter. The new model allows customers to derive
more value from increased adoption by paying initially for the platform and
incrementally for additional service levels and usage. It is designed so that
per seat pricing doesn’t hamper a customers’ ability to implement Domo across
It has also revamped its enterprise apps. The enterprise apps now include a Retail Performance Suite focused on retail customers to help them compete more effectively through better store performance and inventory management analytics. It also released a new suite of IoT apps to help manufacturers create value from IoT data.
Domo has also announced a new IoT partnership with Zendesk. The Zendesk IoT app takes machine data and runs it through Domo’s learning and workflow engines and automatically initiates a Zendesk support ticket without any human involvement.
Earlier this year, Domo had announced the launch of the Domo Integration Cloud, an iPaaS solution that includes more than 1,000 pre-built connectors and query capabilities to connect to and leverage data. The Integration Cloud can connect to 17 separate AWS Services such as Redshift, RDS, Aurora, Athena, S3, and 19 Google services such as BigQuery, Google Analytics, AdSense, and Google Cloud Storage. It helps customers to quickly and securely bring together many disparate data sources to deliver business value.
Domo is making the right moves to drive growth to its platform, but a less than impressive outlook had the investors worried. The data analytics market is currently undergoing consolidation. Salesforce recently acquired Tableau for $15.7 billion and Google acquired Looker for $2.6 billion. I think Domo could also be a potential acquisition target for other tech giants looking to make it big in the cloud-based analytics space. For instance, SAP could benefit by adding Domo’s visual capabilities to its Business Intelligence Platform. Domo already offers several apps that are focused on SAP solutions and can pull data from SAP tools to help businesses make meaningful decisions.
Domo went public in June last year. It had raised $690 million from investors including Andreessen Horowitz, Benchmark, Bezos Expeditions, BlackRock, BYU Cougar Capital, Capital Group, Credit Suisse, Dan Rose, David Lee, Dragoneer Investment Group, Fidelity Investments, Founders Fund, GGV Capital, Glynn Capital Management, Greylock Partners, HWVP, Hummer Winblad Venture Partners, IVP, Mercato Partners, Meritech Capital Partners, Morgan Stanley, Pelion Venture Partners, Salesforce Ventures, SharesPost Investment Management, SV Angel, TPG Growth, Transmedia Capital, T. Rowe Price, Viking Venture Management, WPP, and Zetta Venture Partners. Its last private round of funding was held in April 2017 when it raised $100 million at a valuation of $2.3 billion.
Last June, Domo went public and raised $193 million at a valuation of $511 million. It is currently trading at $27.56 with a market capitalization of $756.8 million. It touched a 52-week high of $47.08 in April this year. The stock had fallen to a low of $13.28 in November last year.
This segment is a part in the series : Cloud Stocks . Smartsheet Acquiring Bootstrapped Startups to Drive Growth . Bootstrapped Unicorn Atlassian is Acquiring Capital Efficient Startups . Netflix Price Hike Ruffles Competition . How Will Carbon Black Differentiate? . ServiceNow Grows Through Addition of Capital-Efficient Startups . Zendesk and Freshworks Follow Different Acquisition Strategies . Tableau Grows Through Small Acquisitions . Open Platform Strategy Stands Intuit in Good Stead . Will GoDaddy Follow the PaaS Route? . Adobe Delivers Via PaaS More »» . A Look at Oracle’s 2018 M&A Activity . What Apps Will Drive More Traction for Cloudera? . Slack's App Focus Will Be Key to Post-IPO Success . IBM Counts on its Cloud and Platform for the Turnaround . Atlassian Acquires From its PaaS Marketplace . What Should SAP Acquire to Triple its Value by 2023? . Expect ServiceNow to Acquire From App Marketplace . Should Alarm.com Follow a PaaS Strategy? . How Upwork Can Leverage the Virtual Company Trend . Qualys Scouting For Acquisitions . Should SAP Acquire Zendesk or Freshworks? . HubSpot Counts on its API Strategy . SurveyMonkey Eyes Acquisitions for Growth . Workday Wants to Disrupt Cloud Computing Using Machine Learning . Einstein and Open-Source Platform Lead the Charge for Salesforce . DocuSign Prepares to Beat Rival Adobe . Veeva Soars, But Dassault Acquires Medidata for $5.8 Billion . Tableau Acquisition Signals Massive Analytics Push for Salesforce . Oracle Joins Hands with Microsoft to Take on Amazon . GoDaddy is Making Strategic Acquisitions for the Next Level of Growth . Alteryx Sees Strong Momentum . Adobe Leveraging Magento and Marketo to Deliver Blockbuster Performance . Is Slack Overvalued? . How Will Cloudera Address the Competition? . Zoom is Not Bothered by Cisco or Microsoft . Domo Counts on Enterprise Revenue for Growth . Netflix Plays with Pricing and Games to Attract Subscribers . 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Splunk on the Right Track with Cloud and PaaS . Veeva Sets an Example, Transitions to a Public Benefit Corporation . BlackLine is Targeting A/R Automation Market . Okta Targets $25B Customer Identity Market with Acquisition . Teradata Trying to Reinvent Itself on the Cloud . Dropbox Acquires, But Competition Remains Stiff . Smartsheet Focuses on Partners, and not on ISVs . MongoDB has Huge Room to Grow in $97B Market . Cloud and Platform Expansion Continues at Nutanix . Rapid7 Targets $1B ARR by 2025 . DocuSign Exploring Unprecedented Digital Signature Offerings . Tenable Continues its Acquisition Spree . SolarWinds Attack Driving Zscaler's Stellar Performance . Zoom Should Report Developer Ecosystem Metrics . DigitalOcean Goes Public with a Strong ISV PaaS Strategy . Dynatrace Competing with Rivals by Simplifying DevOps . Talend Becomes a Private Firm, Once Again . Everbridge Focuses on the Government Sector . Analysis of Fastly’s Signal Sciences Acquisition . 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DocuSign Sees Digital Signature Trends Here to Stay . Market Leader Tenable Leverages Acquisitions for Growth . Analysis of Zscaler's Recent Two Acquisitions . Analysis of Rapid7's Velocidex Acquisition . Dropbox Expands in International eSignature Market . MongoDB Rides High on Five Years of Atlas . RingCentral Leverages Partnerships for Growth . BlackLine Remains Focused on SAP . ON24 Expands Marketing Offerings . Analysis of Magnite's Spot X Acquisition . PagerDuty Focuses on Integrations . Upstart Expands into Auto Loans Through Prodigy Acquisition . Analysis of Bill.com's Divvy Acquisition . C3.ai Doubles Down on Partnerships . Analysis of Coupa's Pana Acquisition . BigCommerce Eyes a Bigger Marketshare Through Walmart Tie-up . Analysis of Everbridge's xMatters Acquisition . Adobe's Digital Solutions Drive Stellar Growth . CrowdStrike Leads in Endpoint Security Through Tie-ups . Snowflake Focuses on Expanded Partner Program to Drive Growth . 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