NetSuite Q3 Results Top Estimates

(RTTNews) - Enterprise software company NetSuite, Inc. (N) reported Thursday a net loss for the third quarter that widened from last year, despite double-digit revenue growth, reflecting higher expenses. However, adjusted earnings per share and quarterly revenues topped analysts' expectations.

"The Cloud giveth, and the Cloud taketh away. While NetSuite reported our ninth consecutive quarter of more than 30% year-over-year revenue growth and Q3 profitability well ahead of our outlook, SAP experienced a sixth straight quarter of declining license sales and announced negatively impacted margins based on the move of customers to the cloud," CEO Zach Nelson said in a statement.

The San Mateo, California-based pure-play cloud ERP software-as-a-service company reported a net loss of $29.30 million or $0.38 per share for the third quarter, wider than $16.77 million or $0.23 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $8.29 million or $0.11 per share, compared to $6.87 million or $0.09 per share in the year-ago quarter.

On average, 26 analysts polled by Thomson Reuters expected the company to report earnings of $0.04 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues for the quarter increased 34 percent to $143.7 million from $106.88 million in the same quarter last year, and topped twenty-four Wall Street analysts' consensus estimate of $141.61 million.

Subscription and support revenues increased to $115.83 million from $85.80 million, as well as professional services and other revenues totaled $27.83 million, up from last year's $21.08 million.

Total operating expenses for the quarter increased to $123.41 million from $84.53 million last year.

"The shift from antiquated software such as SAP and Microsoft to NetSuite's modern cloud-native solution is transforming the capabilities of small, medium and large organizations around the globe," Nelson added.

N closed Thursday's regular trading session at $93.01, up $3.42 or 3.82% on a volume of 0.76 million shares. The stock gained a further $4.04 or 4.34% in after-hours trading.