Zuora (ZUO, $22.39) down -12% pre-market, on weaker Q1 revenue guidance, despite Q4 beat

Zuora shares slumped -12.9% during pre-market Friday, after the company reported weaker-than-expected guidance on first fiscal quarter revenue.

The company, which provides enterprise software for businesses to manage subscription-based billings, has predicted revenue of $65 million to $66 million for its first fiscal  quarter, falling short of Wall Street expectation of $66 million.

Zuora expects to incur a loss of -12 cents to -13 cents a share for the quarter, which is in line with what analysts are expecting.

Zuora’s expectation for the full fiscal-year revenue ranges between $293 million and $297.5 million, compared to the Street forecast of $294.2 million. The company’s projection of -40 cents to -44 cents loss a share for the year matches analysts’ expectations.

The company’s actual results for the fourth quarter were more favourable, with its adjusted loss of -11 cents a share meeting analysts’ estimates, and its revenue of $64.1 million exceeding expectations of $62.8 million.

Speaking of the company’s latest performance, CEO Tien Tzuo emphasized that more than $10 billion of subscription-based billings were processed through Zuora’s system. He also hinted that an increasing number of businesses that are joining the global subscription network should count on Zuora as their strategic partner in the long-term.

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Sergey Savastiouk|Expert

Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.