SentinelOne stock fell Wednesday after the cybersecurity company reported earnings and earnings for the January quarter that were over-estimated and made a big acquisition.
SentinelOne, based in Mountain View, California, reported earnings after the market closed on Tuesday. Shares of S fell 1.3% to 30.50 before the market opened in stock market today.
“SentinelOne posted good results in the fourth quarter, with revenue exceeding the upper bound of guidance by 8%, despite the shares falling,” Wells Fargo analyst Andrew Nowinsky said in a report. “There weren’t really any downsides to highlight, as all key metrics came in better than expected. First quarter guidance was definitely better than expected for revenue, although operating losses were a bit higher than Street was expecting.”
Also on Tuesday, SentinelOne acquired Attivo Networks in a cash and stock transaction worth $616.5 million. The company said Ativo was not included in its fiscal year 2023 guidance.
SentinelOne reported an adjusted loss of 17 cents per share versus a loss of 84 cents a year earlier. Revenue rose 120% to $65.6 million, up 120%. Analysts had expected SentinelOne to report revenue of $60.7 million and a loss of 18 cents per share. The results were for the fourth quarter ended January 31.
SentinelOne Stock: Revenue Guidance Above Estimates
For fiscal year 2023, SentinelOne forecast revenue of $368 million in the middle of the company’s forecast. Analysts had expected a loss of 69 cents a share on revenue of $346.1 million.
“We ended the fourth quarter with a double-digit annual improvement in both non-GAAP operating and gross margin,” SentinelOne management said in a letter to shareholders. “Given the significant market opportunities ahead, we remain committed to investing in the growth of our business in a disciplined manner. In fiscal year 2023, we expect to continue to make progress toward our long-term profitability goals.”
Heading to SentinelOne’s earnings report, the stock is down 37% in 2022. SentinelOne stock has a relative strength rating of just 18 out of the possible top 99, according to IBD stock check.
Annual recurring revenue from subscription-based services increased 123% to $292 million, outstripping ARR growth estimates of 60%.
SentinelOne’s cybersecurity software detects malware on laptops, mobile phones, and other “endpoints” that access corporate networks. SentinelOne competes with CrowdStrike Holdings (CRWD) and others.
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