Cloudflare Inc., Synaptics Inc. and NortonLifeLock Inc delivered solid earnings beats in their quarterly earnings reports Thursday but had different outlooks for the quarter ahead.
For the quarter ending June 30, Cloudflare reported non-generally accepted accounting principles earnings per share of break even compared to a loss of two cents per share in the same quarter of 2021. Revenue came in at $234.5 million, up 54% year-over-year.
Analysts had expected an EPS loss of one cent on revenue of $227.33 million.
Gross profit in the quarter came in at $176.7 million, up 77% from $117.4 million in the second quarter of 2021. Non-GAAP gross profit was $185 million, up 78% year-over-year. Cash flow from operating activities was $38.3 million, up from $7.5 million in Q2 2021.
Highlights in the quarter included Cloudflare expanding its zero trust platform with email security, data loss prevention tools cloud access security broker and private network discovery. The company also announced the Cloudflare One Partner Program to help businesses of all sizes adopt zero trust solutions that they had previously found difficult to procure, implement and support.
“We delivered another strong quarter… driven by strength in our large customer and a record number of large customer additions,” Matthew Prince, co-founder and chief executive officer of Cloudflare, said in a statement. “Large customers now represent 60% of our revenue, and they are leaning forward to hear how Cloudflare can save them money and reduce IT complexity, all while increasing their security, performance, and reliability.”
For the third quarter, Cloudflare is predicting non-GAAP net income per share of between break even and one cent on revenue of $250 million to $251 million. Analysts had expected an EPS of one cent on revenue of $246.9 million.
For the full year 2022, Cloudflare expects non-GAAP EPS of three cents to four cents on revenue of $968 million to $972 million – analysts were expecting three cents and $958.4 million.
The strong earnings beat combined with a higher-than-expected outlook for both the third quarter and the full year saw investors snap up Cloudflare shares in late trading. Cloudflare’s share price was up 21.5% to $70.99 as of 6:43 p.m. EDT.
Like Cloudflare, Synaptics also delivered better-than-expected results, reporting non-GAAP EPS of $3.87 on revenue of $476.4 million. Analysts had been expecting $3.67 per share on revenue of $472.74 million.
“Synaptics had a terrific fiscal 2022, recording company records for revenue, gross margins, non-GAAP operating margin, EPS, and cash flow, and made significant progress in our strategy to enter high-value markets and diversify the customer base,” Michael Hurlston, president and CEO of Synaptics, said in a statement. “While there is increased economic uncertainty, our plan is to continue to invest in our businesses.”
Looking forward, Synaptics predicts revenue of between $440 million to $470 million in its September quarter. Analysts had been expecting a figure of $465.1 million.
The earnings beat somewhat balanced by an outlook that was at the lower end of expectations. Synaptic shares were mostly flat in after-hours trading, up 0.71% to $146 as of 5:38 p.m. EDT.
Last but not least, NortonLifeLock reported non-GAAP EPS of 45 cents on revenue of $708 million – up 7% and 2%, respectively, year-over-year. Analysts had been predicting an EPS of 43 cents on revenue of $707 million.
Along with the earrings results, NortonLifeLock also announced that it had received provisional approval from the U.K. Competition and Markets Authority for its acquisition of Avast plc.
“Q1 was another quarter of solid execution by our team and in the face of macroeconomic
headwinds, we delivered our 12th consecutive quarter of bookings growth,” Natalie
Derse, chief financial officer of NortonLifeLock, said in a statement. “Now with the Avast acquisition provisionally approved we look forward to bringing our operational discipline to the integration planning and quickly setting the foundation of the company for growth.”
For the quarter ahead, NortonLifeLock is predicting non-GAAP EPS of 44 cents to 46 cents on revenue of $695 million to $705 million. Analysts had expected EPS of 44 cents on revenue of $725 million.
The miss in earnings outlook outweighed the earnings beat, with NortonLifeLock’s share price down 3.01% to $25.80 as of 5:54 p.m. EDT.
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