Wednesday's Headlines: UiPath Slumps As Forecast Underwhelms
Here were the biggest movers in the MyWallSt shortlist yesterday:
Moving Up ⬆️
Calavo Growers (CVGW) +5.4%
Lululemon (LULU) +4.3%
Stitch Fix (SFIX) +3.4%
Wix (WIX) +3.3%
Lemonade (LMND) +2.2%
Moving Down ⬇️
StoneCo (STNE) -7.2%
Baozun (BZUN) -6.4%
Hain Celestial (HAIN) -6.4%
Redfin (RDFN) -6.3%
Here are the stories that you need to know ahead of market-open today, Wednesday the 7th of September.
UiPath Slumps As Forecast Underwhelms 😰
UiPath is currently down over 20% and falling in pre-market trading as investors react to its earnings call from last night. The automation software company lowered its revenue outlook for the year, prompting a mass selloff amongst its shareholders.
UiPath reported a loss per share of $0.22 on revenue of $242.2 million, while analysts had estimated a loss of $0.11 per share on revenue of $230.7 million — quite the mixed bag for the firm. However, expected revenue for fiscal year 2023 is now forecast to come in between $1 billion and $1.01 billion, down from a previous mark of $1.09 billion at the high end. According to CFO Ashim Gupta:
“We delivered a solid second-quarter fiscal 2023 despite increasing FX headwinds and macro uncertainty. While our global footprint is an asset to the business, it exposes us to foreign exchange and macroeconomic volatility. which is reflected both in our fiscal second-quarter results and our fiscal third-quarter and full-year 2023 financial outlook.”
UiPath was already sitting at all-time lows prior to this morning's firesale, with its stock down almost 22% year-to-date at market close yesterday. The company initially launched on the public market via IPO in April 2021, but has been in a state of decline ever since hitting all-time highs in May of that year.
Today’s pre-market slump emphasizes the glaring issues currently being faced by many tech companies as the market continues to rail against them amid rampant macroeconomic uncertainty.
Coupa Trooping on After Earnings 💪
Coupa Software (COUP) is up big after last night’s earnings report provided a welcome surprise for the beleaguered software company. Shares are up 12% in pre-market trading at time of writing after the spend-management specialist’s guidance pleased investors.
While revenue for the following quarter is expected to fall fairly in line with estimates at $211 - $214 million, the company’s forecast for adjusted earnings per share of $0.08 - $0.10 was a welcome surprise.
Coupa’s updated full-year guidance paints a similar picture, with an incremental increase in revenue and a big boost in earnings. Management almost doubled the company’s expected adjusted earnings per share for the fiscal year 2023 from $0.21 - $0.27 to $0.37 - $0.44. The company’s rosier outlook for the second half of the year was music to Wall Street’s ears, and while Coupa is still loss-making, its path to profitability seems much clearer after last night’s report. Management said they would also authorize a $100 million share repurchase program.
Like many of its tech compatriots, Coupa is down over 60% year-to-date as a shift in sentiment and a much tougher macro environment have brought question marks over unprofitable businesses. Hopefully this report will spark the turnaround the stock so desperately needs.
GitLab Rebounds After Market Overreaction 💻
Shares in GitLab Inc. have rebounded in pre-market trading after investors initially punished the stock, believing its guidance was conservative.
Revenue increased by a stunning 74% year-over-year in the second quarter, reaching $101 million, exceeding expectations of $94.4 million. The company also managed to beat estimates for earnings-per-share, recording a 15 cent-per-share loss compared to Wall Street’s predicted 23 cent-per-share loss.
Management anticipates third-quarter revenue of $105 million to $106 million
More importantly, several key performance metrics suggest the Ukrainian unicorn still has lots of room to grow. Dollar-based net retention exceeded 130% this quarter while customers with more than $100,000 of annual recurring revenue increased by 55%.
GitLab is a software company responsible for developer tools that reduce product lifecycles and increase productivity. It does this through its web-based, open-source Git repository, which helps developers store, share, and track code. GitLab also runs a DevOps platform enabling professionals to perform and oversee projects, from planning to source code management to security. It’s known for its collaborative functionality, allowing teams to build better software together. GitLab is free for individual developers but charges for additional functionality.
GitLab IPO’d in October 2021 and is so far down 54%. The stock initially fell 7% on its earnings release but has since recovered.