That’s a fair question. Why the beat in first quarter was 5.5% vs 25% this quarter.
Not unheard of volatility in earnings projection terms. What seems to be asked here, is, what’s behind the “failure” to consistently forecast quarterly earnings by a company that is growing quite fast.
One thing is the complexity of the task - the function box that spits out a final number has a significant number of inputs.
The other is management’s philosophy about projections and which version to share with the public.
The result (public forecast + or - actual) = earnings difference. Generally companies like to undershoot on earnings forecasts, because our culture likes that. So if we see them overpromise we tend to think they don’t know what they are doing, even in companies that are making money. Here we have a “beat” that is 25%, so good (in our culture).
Ultimately, however, until a number comes out and is history, spending too much time on forecasted earnings can make you manic-depressive. We now have the numbers for the quarter and they are good. If the company does a reasonably good job of telling you where they are going, that is another good thing - they seem to be hitting their targets.
In summary, very pleased with the numbers, their earnings projections don’t change my views, it seems there are multiple untapped significant markets waiting (autos, homes), so…Long UPST. Thanks to all on the board.
Cheers,
Bill