Following the announcement of third-quarter earnings by the experience management platform operator, Qualtrics stock (NASDAQ:XM) climbed about 11% in after-hours trading on Monday.
After the market closed on Monday, Qualtrics International (NASDAQ:XM), the pioneer and originator of the experience management (XM) category, revealed better-than-expected third-quarter 2022 earnings.
Market Analysis of Qualtrics Stock
In Monday’s after-hours trade, Qualtrics stock (NASDAQ:XM) rose 10.7%. The market’s favorable first response may be attributable to the quarter’s sales and profits above Wall Street’s consensus predictions, fourth-quarter guidance for both the top and bottom lines exceeding analysts’ expectations, and management upgrading its full-year revenue and earnings view.
Many investors are likely unfamiliar with the company Qualtrics. It had its initial public offering in January 2021 as a partial separation from German software giant SAP. SAP retained a majority share.
Subscription revenue increased by 43% to $314.8 million, driving revenue growth. According to the company’s results presentation, the number of clients paying more than $100,000 in yearly recurring revenue increased 32% year over year to 2,199.
The dollar-based net retention rate for Qualtrics’ subscription business was 124%, which is an excellent achievement. This indicates that current customers boosted their expenditure on the company’s products by 24% on average over the previous year.
On sales of $358.6 million, Wall Street expected an adjusted loss per share of $0.02. As a result, Qualtrics comfortably outperformed both estimates. The business also outperformed its own forecast of an adjusted loss per share of $0.04 to $0.02 and sales of $358 million to $360 million.
Increased Full-Year Guidance
Management anticipates the following for the fourth quarter of 2022:
Revenue of $380 million to $382 million, representing a 20% to 21% increase, adjusted profits per share of $0.02 to $0.03, compared to a year earlier adjusted loss per share of $0.07.
Wall Street expected Q4 sales of $373.1 million and an adjusted loss per share of $0.01 going into the quarter. As a result, the company’s prognosis exceeded both of these projections.
Qualtrics Stock: It’s Worth Viewing.
Qualtrics stock (NASDAQ:XM) is one to keep an eye on. The company’s revenue is fast increasing, and it now aims to be profitable on an adjusted basis in 2022. Software-as-a-service (SaaS) organizations create recurring income streams, which is a significant advantage.
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Author Okoro Chinedu 
