Cloudera Shares Tumble in First Quarterly Report

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In its first quarterly report as a public company, Cloudera got a taste of what rival Hortonworks has been feeling when a billing miss sent its stock tumbling 15%.

The company, which debuted on the NYSE under the symbol CLDR in late April, had good numbers otherwise. It reported total revenue of $79.6 million for its first fiscal quarter for 2018 ended April 30, which was an increase of 41% from the previous year and above expectations of analysts who cover the equity.

Likewise, its GAAP loss of $222.3 million was narrower than expected. This helped send Cloudera shares initially higher in after-hours trading late Thursday following the release of its quarterly report.

But by Friday morning, after analysts had more time to digest all the numbers – in particular the billings data, which shows how effectively the Palo Alto, California company is converting subscription deals into revenue – Cloudera’s stock price took a nosedive.

The problem had to do with the timing of billings. Analysts with JP Morgan expected calculated billings to come in around $81 billion, but the actual figure came in at $75.2 million. In effect, deals that Cloudera expected to close in the first quarter were pushed out to the second quarter. The fact that contract duration was 18 months instead of 20 months didn’t help matters, either.

All told, the calculated billings represented growth of only 26% compared to the same metric a year ago, which was below expectations. “We think the billings miss in its public debut will put the stock in the penalty box near- to mid-term,” wrote J.P. Morgan analyst Mark Murphy. Murphy cut his price target for the stock from $24 to $20.

Cloudera’s shares closed at $18.60 on Friday, down from about $22.50. It’s still trading higher than its IPO price on April 28.

The company — which was the was the first Hadoop distributor and is still the largest — expressed optimism. “We had a strong first quarter as a public company, making progress against many of our key objectives,” Cloudera CEO Tom Reilly stated. “We are proud of the role that Cloudera is playing in helping solve some of the world’s most challenging problems through data.”

Reilly cited the release of the Data Science Workbench, the launch of Cloudera Altus, and the general availability of Apache Kudu as milestones during the quarter. “In addition, I am pleased with the success that our customers are experiencing in becoming data- and insight-driven enterprises and its corresponding effect on our business with our net expansion rate of 142% for the quarter.”

While the poor billings data shows there’s still a lot of work to be done to turn big data into big profits, it’s too early to throw in the towel on Cloudera or big data in general.

“Big data vendors are showing very strong growth with a CAGR of 50%,” Arcadia Data‘s Steve Wooledge writes in a blog. “The hype is slowing down, but the real value and growth is only just beginning as we’re still in the early innings.”

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