Why Smartsheet's Q2 Was So Strong
When Smartsheet Inc. (NYSE: SMAR) released its fiscal second-quarter financial results after the markets closed on Tuesday, the company said that it had a net loss of $0.08 per share on $42.4 million in revenue. Consensus estimates had a called for a net loss of $0.14 per share and $39.1 million in revenue.
During the quarter, Subscription revenue was $37.5 million, an increase of 57% year over year, and Professional services revenue was $4.9 million, an increase of 71%.
The company ended the quarter with 76,693 domain-based customers, with the average annualized contract value (ACV) increasing 49% year over year to $2,002. The number of all customers with ACV of $50,000 or more grew to 298, an increase of 146%.
Looking ahead to the fiscal third quarter, the company expects to see a net loss in the range of $0.16 to $0.15 and total revenue between $43.5 million and $44.5 million. Consensus estimates call for a net loss of $0.17 per share and $41.21 million in revenue for the quarter.
Mark Mader, CEO of Smartsheet, commented:
Q2 was a strong quarter with revenue growing 59% year-over-year and net dollar retention rate reaching a record 131%. We continue to drive better business outcomes for our customers by empowering everyone to improve the way they work, connect, innovate, and execute.
Shares of Smartsheet closed Tuesday at $31.70, with a consensus analyst price target of $31.00 and a post-IPO range of $18.06 to $32.79. Following the announcement, the stock was up 11% at $35.25 in early trading indications Wednesday.