ARR from subscriptions increased by 30% year over year to $175 million, outpacing the 1% increase seen in total ARR. Revenue from subscriptions increased by 45% year over year, totaling $50 million, which was significantly higher than the $41 million expected by consensus. Management also guided for 1Q23 sales to be between $177 and $182 million. This was higher than the $183 million forecast and the $180 million expected by the market. The $187 million in sales were flat year over year but up 2% in constant currency terms.
Overall, I see few near-term catalysts, and it's unclear if SWI can successfully complete its transition and overcome the bad reputation situation in order to reaccelerate growth to historical levels. Even more so, SWI is up against stiff competition from larger vendors who are increasingly including network monitoring as part of their comprehensive product suites. Key issues that I see would weigh on the stock and growth prospects are the slowing customer growth, the challenging competitive environment, the business transition, and the stigma from the cyber security incident.
Even though SWI is the clear frontrunner in the field of network performance monitoring, there are many things I'm not comfortable about with the company right now and in the near future. My recommended rating for SolarWinds Corporation ( NYSE: SWI) is neutral.
0 kommentar(er)
