AYX earnings

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

38 Likes

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.

Yep. I ran numbers last week and I think it’s likely they get between $133.6m and $140m for Q1 2020. If the multiple expands similar to what DDOG had for a multiple recently then the AYX stock should be around $250. I doubt it will run up that high but I would expect the stock to be between $175 and $225 in the weeks following Q1 (assuming we don’t get a sector rotation or a market-wide drop).

Chris

15 Likes

Last year, their March quarter beat was $4.5M or 6% over midpoint of guidance at $71.5M.

While I agree that size of the beat have been increasing over last three quarter, there is seasonality in the business.

So I am modeling more conservative at $120M which would be $13.5M beat or low double digits. If they do stronger than that, more power to them but I am happy with even $120M.

I am not sure what the market was expecting here… 21% revenue beat over guidance and the stock is one of the weaker SaaS names during this selloff.

Not enough acceleration in the Billings number? Shrug

I took the opportunity to add LEAPs to my large share position today.

1 Like