The recessionary economic conditions are driving organizations to invest in spend management solutions like those offered by San Mateo-based Coupa (Nasdaq: COUP). Coupa is also benefiting from its cloud-based model that helps in the current remote working conditions.
Revenues for the first quarter of the year grew 47% to a record $119.2 million, ahead of the market’s estimates of $111.5 million. GAAP net loss of $14.8 million was better than previous year’s net loss of $20.5 million. On an adjusted basis, net income was $0.20 per share compared with $0.03 per share a year ago and the market’s forecast of $0.07 per share.
By segment, subscription services revenues increased 45% to $105.7 million and professional services revenues grew 6% to $13.5 million. Coupa attributed the significant increase in revenues for the quarter to adoption of its Business Spend Management (BSM) offerings and Coupa Pay offerings.
For the current quarter, the company expects revenues of $118-$119 million with non-GAAP income of $0.06-$0.08 per share. It expects to end the year with revenues of $489-$491 million with net income of $0.36-$0.38 per share. The market was looking for revenues of $117.27 million for the quarter with an EPS of $0.05 and revenues of $489.15 million for the year with an EPS of $0.35.
Coupa continued to expand its offerings through a recent acquisition. Last month, it announced the acquisition of BELLIN Group, a leading provider of treasury management software (TMS). BELLIN’s cloud-based TMS platform helps improve visibility and provides organizations with control over cash while optimizing treasury processes.
Ettenheim, Germany-based BELLIN was founded in 1998 by Martin Bellin, a former corporate treasurer, to deliver a more practical approach to solving the problems faced by treasury functions. It simplified and automated reporting, treasury, banking, reconciliation, planning, and risk management. The acquisition will help extend Coupa’s presence within the organization’s treasury, payments, and working capital processes. It will help make it a comprehensive platform for managing business spend. The terms of the acquisition were not disclosed. Prior to the acquisition, BELLIN was privately held and had raised a private equity round in 2017 by LEA Partners. It did not disclose its financial performance as well.
Coupa rightly believes that the Treasury function, especially in current conditions, cannot be an independent function. It needs to be an integral part of a company’s spend management strategy. The acquisition of BELLIN will help it provide the organizations with a comprehensive view of company spend, liquidity, and associated risks. It will be able to offer businesses full cash and liquidity management, forecasting capabilities, advanced payments capabilities, and above all, working capital management across the platform.
The market is pleased with Coupa’s acquisition and results. Its stock is trading at $283 with a market capitalization of $19 billion. The stock hit a 52-week low of $99.01 in March this year and a 52-week high of $314.09 earlier last week.
This segment is a part in the series : Cloud Stocks