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Anaplan (PLAN) Beats Earnings and Revenue Estimates in Q3

Zacks Equity Research

Anaplan PLAN reported third-quarter fiscal 2020 adjusted loss of 8 cents per share, narrower than the Zacks Consensus Estimate of a loss of 13 cents and the year-ago quarter’s loss of 18 cents.

Revenues of $89.4 million beat the Zacks Consensus Estimate by 3.5% and increased 44.2% year over year.

Quarterly Details

Subscription revenues (89.1% of total revenues) increased 47% year over year to $79.7 million on higher subscriber count.

Revenues from Professional services (10.9% of total revenues) increased 27% year over to $9.7 million.

The company’s dollar-based expansion rate was 123%, aided by solid demand for the company’s Connected Planning solution.

Notably, the company closed a record number of expanded deal worth seven figure, demonstrating the success of its Planning Solutions among existing clients.

Anaplan acquired new customers at a steady pace, ending the quarter with more than 1300 total customers across a wide range of industries. This was aided by increased usage of its solutions in adjacent business areas like finance, supply chain and marketing.

Moreover, the company is now serving 324 customers with more than $250K in annual recurring revenues, reflecting an impressive year-over-year growth of 42%.
 

Anaplan, Inc. Price, Consensus and EPS Surprise

 

Anaplan, Inc. Price, Consensus and EPS Surprise

Anaplan, Inc. price-consensus-eps-surprise-chart | Anaplan, Inc. Quote

 

Third-Quarter Development

The company released its new mobile app Anaplan Mobile in October. The app’s multi-device accessibility simplifies planning across various devices. Decision makers can now access intelligent planning capabilities on the go and increase productivity.

Operating Details

Total operating costs increased 4.6% year over year to $99.5 million.

While general & administrative expenses declined 35% to $22.3 million, sales and marketing expenses rose 25% to $60.6 million. The rise was primarily led by increased hiring of salespersons.

Additionally, research and development expenses increased 35% year over year to $16.5 million.

Anaplan’s non-GAAP operating loss was $8.8 million compared with a loss of $18.3 million in the year-ago quarter.

Balance Sheet & Cash Flow

Total cash and cash equivalents as of Oct 31, 2019, were $310.8 million compared with $326.9 million as of Jan 31, 2019.

Free cash outflow was $19.9 million compared with $17.3 million a year ago.
     
Fourth-Quarter Guidance

Anaplan expects revenues in the range of $96.5-$97.5 million.

For 2020, total revenues are expected between $346 million and $347 million.

Zacks Rank & Stocks to Consider

Anaplan currently has a Zacks Rank #3 (Hold).

Alteryx AYX, Cirrus Logic CRUS and Marchex MCHX are a few better-ranked stocks in the broader computer and technology sector. All three companies sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

While the long-term earnings growth rate for Alteryx is pegged at 39.95%, both Cirrus Logic and Marchex’s earnings are expected to grow 15%.

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