Zuora (ZUO) - Any thoughts?

Bear & Duma,

I did express the same concerns about the services revenue to Bert and his response is pasted below:

“Part of the reason for the negative gross margin on services has to do with the impact of the RevPro acquisition a year ago and the deferred revenue write down that is required. RevPro had lots of services revenue as proportion of the total and you are seeing that impact. That will normalize in fiscal year 2020-that is to say after one more quarter. The company will not run at a negative professional services gm.”

Hope this helps.

GM

3 Likes