Confluent Q2 2022

  • $139M rev (+58% YoY) vs $132M consensus (6% beat)
  • $144M next Q guidance vs $142M consensus (1% raise)
  • $47M Confluent Cloud rev (+139%)
  • 130% net retention

  • 38 months GM adj. CAC payback
  • 64% GM
  • (26%) FCF Margin

Confluent Cloud revenue of $47 million, up 139% year over year
Remaining performance obligations of $591 million, up 81% year over year
857 customers with $100,000 or greater in ARR, up 39% year over year


Revenue
2019	29	34	39	48
2020	51	54	62	70
2021	77	88	103	120
2022	126	139

Revenue QoQ
2019		17	15	23
2020	6	6	15	13
2021	10	14	17	17
2022	5	10

Revenue YoY
2020	76	59	59	46
2021	51	63	66	71
2022	64	58

Customers >100k
2019				337
2020	374	408	449	513
2021	561	617	664	734
2022	791	857		

Customers >100k QoQ
2020	11	9	10	14
2021	9	10	8	11
2022	8	8		

Customers >100k YoY
2020	NaN	NaN	NaN	52
2021	50	51	48	43
2022	41	39

Customers >1mil
2021	60	70	74	88
2022	97	107

Customers >1mil QoQ
2021		17	6	19
2022	10	10

More details: https://investors.confluent.io/financial-information/quarter…

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Certainly a lot to like in CFLT’s Q2 report. Here are a few other items that stood out to me:

Cloud revenue grew 21% QoQ and is now 34% of total revenue (up from 22% of total revenue a year ago).

They expect a $2-3M revenue impact in Q3 and $4-6M impact to FY revenues due to increased deal scrutiny as clients use sharper pencils to maximize their IT spend. These impacts are included in their forward guidance. In spite of macro pressures on clients’ budgets, the company believes that it is better situated because it is part of the client’s operational stack powering core business transactions while its cloud platform enables clients to reduce IT spend resulting in bottom line improvements.

For the third consecutive quarter, their cloud offering accounted for more than 50% of new ACV bookings.

Customers bringing in more than $1M ARR grew to 107 (53% YoY).

Kafka data-streaming has become the de facto standard for data in motion used by over 70% of the Fortune 500.

CFLT launched a Confluent cloud reseller program in collaboration with 17 other business partners, including Amazon AWS, Microsoft and MongoDB.

Institutional ownership has risen three quarters in a row and is currently at 72%.

Beachman (Beachman.substack.com)

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