Table of Contents
1. Brief Earnings Snapshots – Salesforce (CRM) and Gitlab (GTLB)
a. Salesforce
Demand:
Slightly missed revenue estimate & slightly missed guide.
8% Y/Y constant currency (CC) revenue growth met its guidance.
Beat cRPO estimate by 1.0%.
11% CC cRPO growth beat 9% growth guidance.
Beat billings estimates by 2.3%.
Profits:
Beat EBIT estimates by 3.7%.
Beat $2.85 EPS estimates by $0.39 & beat guidance by $0.40.
Missed operating cash flow estimates by 5%.
Guidance & Valuation:
Raised Q4 revenue guidance by 2.8%, beating estimates by 2.6% (M&A helping).
Slightly raised $3.02 Q4 EPS guidance by a penny, meeting estimates.
Beat Q4 9% CC cRPO growth estimates with 13% growth (4 point M&A boost).
For the year, demand growth guidance was raised with the help of M&A. EBIT margin guidance was maintained. EPS guidance was raised by the size of the Q3 beat.
CRM trades for 21x forward EPS. EPS is expected to grow by 15.4% this year and by 10.5% next year.
Balance Sheet:
$11.3B cash & equivalents; $6.4B investments.
Diluted share count fell by 1.5% Y/Y.
3.4% Y/Y dividend growth.
b. Gitlab (GTLB)
Demand:
Beat revenue estimates by 1.8% & beat guidance by 2.5%.
27.8% 2-yr revenue compounded annual growth rate (CAGR) vs. 30% Q/Q & 30% 2 quarters ago.
Missed 120% net retention rate (NRR) with 119% NRR.
Missed billings estimates by 3.8%. Roughly met RPO estimates.
Profits:
Missed 89.9% GPM estimates by 130 bps.
Beat $32M EBIT estimates by $12M & beat guidance by $12.5M.
Beat $0.20 EPS estimates by $0.05 & beat $0.195 guidance by $0.055.
Guidance & Valuation:
Raised Q4 revenue guidance by 0.8%, meeting estimates.
Raised Q4 EBIT guidance by 4.5%, meeting estimates.
Raised Q4 EPS guidance from $0.22 to $0.23, meeting estimates.
Gitlab trades for 38x forward EPS. EPS is expected to grow by 21% this year, 16% next year and 23% the year after.
Balance Sheet:
$1.2B in cash & equivalents.
No debt.
Stable diluted share count.
Basic share count rose by 3.8% Y/Y.
2. ServiceNow (NOW) – COO/President Interview with UBS
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