Does this help?
Total Revenue yoy growth S&S revenue yoy growth S&S Billings yoy growth Hardware yoy growth
Q1 2016 88.7 74 102 14.7
Q2 2016 116.4 88 115 28.4
Q3 2016 126 95 129 31
Q4 2016 160.5 120 166 40.5
Q1 2017 188.6 112.63% 140 89.19% 191 87.25% 48.6 230.61%
Q2 2017 199.2 71.13% 144 63.64% 172 49.57% 55.2 94.37%
Q3 2017 205.7 63.25% 146 53.68% 175 35.66% 59.7 92.58%
Q4 2017 252.5 57.32% 179.6 49.67% 216.3 30.30% 72.9 80.00%
Q1 2018 275.6 46.13% 195 39.29% 235 23.04% 80.9 66.46%
Q2 2018 286.7 43.93% 209 45.14% 275 59.88% 78 41.30%
Q3 2018 289.4 40.69% 227 55.48% 292 66.86% 62.6 4.86%
Q4 2018 303.7 20.28% 267.9 49.16% 359.2 66.07% 35.8 -50.89%
*Q1 2019 310 12.48% 295 51.28% 390.1 66.00% 15 -81.46%*
*Q2 2019 313.5 9.35% 313.5 50.00% 456.5 66.00% 0 -100.00%*
*Q3 2019 340.5 17.66% 340.5 50.00% 484.72 66.00%*
*Q4 2019 401.85 32.32% 401.85 50.00% 596.272 66.00%*
*Q1 2020 442.5 42.74% 442.5 50.00% 647.566 66.00%*
*Q2 2020 470.25 50.00% 470.25 50.00% 757.79 66.00%*
*Q3 2020 510.75 50.00% 510.75 50.00% 804.6352 66.00%*
*Q4 2020 602.775 50.00% 602.775 50.00% 989.81152 66.00%*
*Q1 2021 663.75 50.00% 663.75 50.00% 1074.95956 66.00%*
*Q2 2021 705.375 50.00% 705.375 50.00% 1257.9314 66.00%*
*Q3 2021 766.125 50.00% 766.125 50.00% 1335.694432 66.00%*
*Q4 2021 904.1625 50.00% 904.1625 50.00% 1643.087123 66.00%*
CEO said S&S revenue most accurately reflects their growth, so I just took 50% and assumed elimination of all pass-through hardware by Q2 2019, and extrapolated until we got 3 billion of revenue. With this, you reach TTM of 3 billion in Q4 2021 - so they just make it if they maintain a 50% growth for the next 3 years.
This is their target, and the numbers work for them to get there, so fairly simple for us to follow to see if it’s achievable. I don’t really foresee any good excuse for revenue growth to decelerate. If it drops below 50%, that’s a serious red-flag we’ll need to quickly evaluate and jump ship unless there is a really really good reason (by it I mean Support and Services revenue, which will very soon become revenue).
So let’s assume this all plays out like the above. What’s gross margin do we give? 85%?
Gross profit of FY 2021 = 2.55 billion.
Operating expenses increased 55% FY 2016 to FY 2017, and 37% from FY 2017 to FY2018. So let’s be conservative and say that 37% continues. You would hope that comes down as the business scales, but let’s say it doesn’t. By 2021, Operating Expenses = 2.27 billion
Operating Profit = 280 million.
At that point, NTNX still won’t be judged by its profits, but by the revenue and revenue growth. Just wanted to extrapolate the numbers to show profits can happen, for whatever that’s worth. Clearly there’s a battle or major trends going on. There’ll probably be multiple winners. But for just following the numbers method, this is something we can look out for.
For added measure, here’s the history of their Gross margin Non-GAAP:
2014 50% 50% 52% 56%
2015 57% 59% 59% 60%
2016 60% 63% 62% 61%
2017 61% 60% 58.4% 58.3%
2018 62% 64% 68% 77.7%