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Zuora Inc. topped expectations with its fiscal second-quarter results but its shares tumbled in after-hours trading Wednesday after the company’s outlook for the current period came up light.
Shares of Zuora ZUO, +6.10%, which makes software that enables businesses to run subscription offerings, were down 13% in after-market trading after gaining 6.1% in Wednesday’s regular session.
The company recorded a net loss of $20.1 million, or 17 cents a share, compared with a loss of $20.8 million, or 19 cents a share, in the year-earlier quarter. After adjusting for stock-based compensation and other expenses, Zuora broke even on a per-share basis, after it posted a 9-cent adjusted loss per share a year prior. The FactSet consensus called for a 7-cent adjusted loss per share.
Zuora’s revenue for the July quarter rose to $75 million from $69.7 million, while analysts were expecting $73.5 million. The company disclosed that its dollar-based retention rate for the quarter was 99%.
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“The demand for subscription business models remains strong and we continue to build the foundation for Zuora to lead the market for years to come,” Chief Executive Tien Tzuo said in a statement.
The company expects $73 million to $75 million in revenue for the fiscal third quarter, a view that came up short of the FactSet consensus, which is looking for $75.5 billion in October-quarter revenue. Zuora anticipates an adjusted loss per share of 4 cents to 5 cents, while analysts surveyed by FactSet had been modeling 5 cents.
Zuora shares have rallied 39% over the past three months as the S&P 500 SPX, +1.53% has gained 9.5%.
