Alteryx sales are gaining momentum.
This is pretty obvious. But I thought I’d try to see what happens when adjusting the 2018 guidance to reflect the change from ASC605 to ASC606. Maybe looking at these numbers can tell us something about the business too.
Here are the guidance historical guidance numbers (midpoint):
Qguide Mar Jun Sep Dec
2017 29.3 32.1 35.8
2018 39.5 43.5 49.5 56.5
2019 70.5 75.5 89.5 129.5
2020 106.5
I pulled these from the press releases, which, for 2018, reflected ASC605 figures.
Here is what Alteryx said of the switch:
As of December 31, 2018, Alteryx no longer qualified as an emerging growth company (EGC).
• Consequently, Alteryx will adopt ASC 606 upon filing of its Form 10-K for the year ended December 31, 2018. The modified retrospective method was used, meaning that our annual and quarterly results for 2018 will be recast.
• Amounts related to periods before 2018 will be reflected in beginning retained earnings as of January 1, 2018.
• Q4 and full year 2018 results are reported under both ASC 605 and ASC 606 for comparability.
So they didn’t report the adjustments prior to 2018, but made the changes and adjustments on the balance sheet in 2018 (the change in sales due to the switch from 605 to 606 falls down to earnings and the amount is reflected in retained earning for the prior periods).
Here are the reported revenues:
Rev Mar Jun Sep Dec Tot
2016 18.4 20.0 22.5 25.0 85.8
2017 28.5 30.3 34.2 38.6 131.6
2018 **50.3 51.5 62.6 89.2 253.6**
2019 76.0 82.0 103.4 156.5 417.9
2018 numbers are adjusted to reflect ASC606. But the guidance numbers haven’t been adjusted (they came off of the press releases).
Here are ASC605 & ASC606 numbers for 2018:
2018 Mar Jun Sep Dec
605 42.8 46.8 54.2 60.5
606 50.3 51.5 62.6 89.2
Adjusting the 2018 revenues back to ASC605, here is the performance over guidance (midpoint):
%Beat Mar Jun Sep Dec
2017 4% 7% 8%
2018 8% 8% 9% 7%
2019 8% 9% 16% 21%
Historically, Alteryx outperformed by high-single digits. Over the last two quarters, the beat accelerated. This has nothing to do with the change to ASC606. It says to me that they are experiencing a lot of unexpected sales.
With sales of 156.5 million last quarter and accelerating RPOs, it simply cannot be that the guidance of 106.5 million (108 hi point) is even moderately close. In March, 2019, they did 76 million in revenues, which was about 15% lower than December, 2018. Applying the same percentage, we’d see about 133 million this quarter. This would be a beat of 25%. If they beat by 9%, which is reasonable, they’d get to 116 million. I’ll bet anybody that they get closer to 133 million than 116 million. This should be really good for the share price in 3 months.
DJ