It’s been tough week. After the Supreme Court leak, way too much layoff news, the declining stock prices of the biggest tech companies and a general sense that the economy is heading in the wrong direction, it’s easy to think everything is worthless.
But we’re here to cheer you up a little, at least to tell you it isn’t all bad news. There are companies that are still doing pretty well, and we wanted to highlight four that had strong earnings reports this week.
While it’s easy to think that everyone is suddenly on a train to nowhere, recent earnings reports from several software companies prove that we are still growing tech stores at a rapid pace. How high? Some were above 50% and 60% growth was not unheard of.
In addition, the companies we look at today shared a largely positive outlook. And yet, even with positive earnings and favorable prospects, the companies were treated by investors ranging from noncommittal to downright hostile.
An argument has to be made that in a recession or similar macroeconomic slowdown some tech companies could do a little better than some seem to expect today; in other words, the lessons of mid-2020 may need to be re-learned.
Let’s take a look at Cloudflare and Confluent’s results to gauge how the market is handling even results that seem pretty solid. We’ll also look at Amplitude, a company that took huge chunks after its fourth quarter 2021 earnings report and therefore did a little make-up in its latest financial report, closing with Appian.
Cloudflare’s Q1 2022 earnings report is a good indicator of the state of affairs. How’s that? The company exceeded revenue expectations for the period, posting revenue of $212.2 million, well above expectations of approximately $205 million. That’s the kind of growth result that would have been electric last year.
For those of you keeping score at home, Cloudflare’s first quarter revenue was up 54% from the previous year. There was also other good news, such as the addition of 14,000 new customers over the period. In addition, the number of customers who spent at least $500,000 grew by 68% and the number of customers who spent $1 million or more grew by 72%.
As CEO and co-founder Matthew Prince put it, Cloudflare’s top customers continued to grow, bringing in more revenue. In addition, the company’s guidelines indicate no signs of slowing down.