DevOps company JFrog Ltd. delivered solid second quarter financial results today, beating Wall Street’s expectations. However, its stock fell slightly in after-hours trading when it offered guidance for the next quarter that was only in line with analyst’s targets.
The company reported a net loss of $23.7 million for the period, amounting to a loss before certain costs such as stock compensation of 2 cents per share. Revenue came to $67.8 million, up 39% from a year earlier. Wall Street had been targeting a loss of 3 cents per share on sales of $65.5 million.
JFrog is a provider of software developer tools, best known for its open-source binary repository manager Artifactory. The offering is somewhat similar to GitHub, which is used by developers to store their code. But it caters to a different part of the development lifecycle, storing the binary files that are created when engineers compile code into a functioning program. The JFrog Platform also includes JFrog Pipelines, a continuous integration and continuous delivery platform that’s used to create automated software workflows that transform raw code into binaries before deploying them automatically.
JFrog co-founder and Chief Executive Shlomi Ben Haim (pictured) said revenue from the company’s cloud offerings accelerated on a sequential basis, showing the importance of hybrid and multicloud DevOps among big enterprises.
“We believe that our success in the second quarter provides further validation that the JFrog platform is the backbone of their software supply chain,” Ben Haim said. “We remain laser-focused on making our Liquid Software vision a reality.”
JFrog said its cloud revenue grew by 68% from a year ago to $19.2 million, representing 28% of its total sales. That suggests its cloud offerings are growing in importance, because cloud accounted for just 24% of sales one year earlier.
The company showed plenty of other positive growth metrics too. Its net dollar retention rate, which is a measure of its ability to retain customers and the revenue they provide, ended the quarter at 132%. Meanwhile, customers that deliver at least $100,000 in annual revenue grew to 647, up from 415 one year earlier. Of those, 36% have adopted the complete JFrog Platform, as opposed to just 32% a year ago.
For the third quarter, JFrog said it’s anticipating earnings of between a penny loss and a penny profit, and revenue of $70.5 million to $71.5 million. That’s more or less in line with Wall Street’s forecast of a penny profit on sales of $70.9 million.
JFrog’s stock slipped just over 1% on the report, having made gains of more than 5% in the regular trading session.
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