Specifically for the example here I think it is hats off to Alteryx that they have the resource and attractiveness to close continent wide deals with bigger TCV in this environment. That indicates a very compelling proposition. In my mind this is not a sign of weakness, it is a show of strength. It follow that is true that it is not an API that you can just start playing around with using a credit card…
Why April is looking better:
Few customers could approve things in March and now the processes have been put in place so when there is a good/great business case to spend they are able to do so. I am guessing that the normal April means that Alteryx keeps showing good business cases for their customers.
Very interesting call on AYX yesterday and very reassuring considering the environment. You can read the earnings release or “Q” for all the numbers, but suffice to say the softer side of the call was encouraging, positive and optimistic going forward. I heard quotes throughout like:
“upscaling of workers; digital transformation is strong; exceeded $1B in cash equivalents; customers are pausing, but not punting; Business model is basically frictionless; analytics are important in good times and absolutely critical in bad times; we hit $400m in ARR milestone for the first time;” and on and on.
My take: I felt they came across very optimistic, but appropriately cautious about the future in spite of the challenges of the Covid-19 crisis. US growth was up 52%, but they saw some slowdown due to Europe where the virus hit earlier and faster and where growth was only up 28%…to be expected.
They made significant new sales in MANY of the hardest hit industries including cruise ships, oil and gas, and healthcare. I’m not worried here long-term and will maintain my position (22% of portfolio among 10 companies owned), noting that the stock is trading this morning ABOVE where it was 3 or 4 short days ago!
The one other gem they threw out at the very end of the call was a hint that “in the next three weeks you will start hearing about a new type of software which sector we plan to own” (paraphrasing). No other clues, but looking forward to what they have in the hopper and not going anywhere on AYX. Cheers!
I was not able to hear the conf call. But intrigued by this statement. What did he mean buy this?
1. April rev. was similar to April 2019 - this is bad 2. April rev. grew at 50% over 19 - this was pre covid expectation unlikely can discount thsi right away 3. April - we booked similar new cust as April 2019 - not sure this is good either. Did’nt they say they grew customers 30% QoQ?
Tex,
Someone asked about this in the call. Here’s the relevant portion.
Ittai Kidron
Thank you and thanks Kevin for all the incremental color on the breakdowns. Very helpful. Just want to follow-up again to the first question on the Q&A which was your comment on improved level of activity in April and you’ve called it or defined it as same as April 2019.
And I’m trying to understand really what does that mean from a new customer acquisition pace? From an expansion pattern? Help me understand in what way is it the same as April 2019? And when you give your guidance for the June quarter is the assumption that that level – is the revenue the target for the second quarter assumes that that level in April stays the same? Or continues to improve? How do we kind of think about the underlying assumptions here?
Dean Stoecker
Well, we actually are comfortable with what happened in April. I think we were pretty excited that we could continue to drive the number of logos we did post-work from home post-shock from COVID. The fact that we were able to get 35% of those new logos and the highly impacted verticals is beginning to potentially change our thesis around whether or not they’re good or bad for an analytics platform like ours.
We’re pretty convinced that analytics is going to be the savior for a lot of these organizations who are highly adaptive. I’m not sure I have any other commentary on that. Kevin?
Kevin Rubin
Yes. No, thanks Ittai. It’s a great question. Look I mean we provided the assumptions and kind of the buildup as we think about Q2 in terms of what we’re expecting and where it’s being contributed. Two-thirds of the quarter is essentially coming from backlog or RPO. You’ve got 15% or so that’s coming from renewals and then the rest will be generated from in-quarter bookings. The commentary around April I think was really the totality of the business.
So, Dean touched on net new logos and what we’ve seen in terms of that activity being very similar. And so the general comment was with respect to our overall business. And then we did build up the – I did provide quite a bit of detail in the buildup to how we’re looking at guidance and the revenue that we expect to see this quarter.
I have sent an e-mail to the IR asking why they do not consistently report ARR. Given the unusual revenue recognition method of Alteryx, revenue is not moving in line with the ARR. For instance, Q2 2020 revenue is expected to be lower than Q3/Q4 2019 whereas ARR will obviously be higher.
This issue was raised by one of the callers. The reply was not informative. They just said they don’t do it and have no plans to in the future. The $400 figure was reported as a one-off because it represented a milestone for them.