Revenue: $275.8 million vs analyst estimates of $271.4 million (3.4% year-on-year growth, 1.6% beat)<\/p>\n
Adjusted EPS: $1.36 vs analyst estimates of $1.19 (14.6% beat)<\/p>\n
Adjusted EBITDA: $105.1 million vs analyst estimates of $96.32 million (38.1% margin, 9.1% beat)<\/p>\n
The company slightly lifted its revenue guidance for the full year to $1.08 billion at the midpoint from $1.07 billion<\/p>\n
Management raised its full-year Adjusted EPS guidance to $4.96 at the midpoint, a 3.3% increase<\/p>\n
Operating Margin: 27.5%, in line with the same quarter last year<\/p>\n
Free Cash Flow Margin: 31.6%, up from 25.7% in the previous quarter<\/p>\n
RPO Bookings: 23% year-on-year growth<\/p>\n
Billings: $273.2 million at quarter end, up 6.1% year on year<\/p>\n
Market Capitalization: $12.09 billion<\/p>\n
Built on a “versionless” cloud architecture that delivers quarterly updates to all customers, Manhattan Associates (NASDAQ:MANH) develops cloud-based software that helps retailers, wholesalers, and manufacturers manage their supply chains, inventory, and omnichannel operations.<\/p>\n
A company\u2019s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Manhattan Associates grew its sales at a 12.5% compounded annual growth rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the software sector, which enjoys a number of secular tailwinds.<\/p>\n
Manhattan Associates Quarterly Revenue <\/p>\n
We at StockStory place the most emphasis on long-term growth, but within software, a half-decade historical view may miss recent innovations or disruptive industry trends. Manhattan Associates\u2019s recent performance shows its demand has slowed as its annualized revenue growth of 9.6% over the last two years was below its five-year trend.<\/p>\n
Manhattan Associates Year-On-Year Revenue Growth <\/p>\n
This quarter, Manhattan Associates reported modest year-on-year revenue growth of 3.4% but beat Wall Street\u2019s estimates by 1.6%.<\/p>\n
Looking ahead, sell-side analysts expect revenue to grow 5.2% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and implies its products and services will see some demand headwinds.<\/p>\n
Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend<\/a>.<\/p>\n Billings is a non-GAAP metric that is often called \u201ccash revenue\u201d because it shows how much money the company has collected from customers in a certain period. This is different from revenue, which must be recognized in pieces over the length of a contract.<\/p>\n Manhattan Associates\u2019s billings came in at $273.2 million in Q3, and over the last four quarters, its growth was underwhelming as it averaged 5% year-on-year increases. This performance mirrored its total sales and suggests that increasing competition is causing challenges in acquiring\/retaining customers.<\/p>\n The customer acquisition cost (CAC) payback period measures the months a company needs to recoup the money spent on acquiring a new customer. This metric helps assess how quickly a business can break even on its sales and marketing investments.<\/p>\n Manhattan Associates is extremely efficient at acquiring new customers, and its CAC payback period checked in at 12.5 months this quarter. The company\u2019s rapid recovery of its customer acquisition costs means it can attempt to spur growth by increasing its sales and marketing investments.<\/p>\n We liked that Manhattan Associates beat revenue, operating income, and EPS expectations. RPO bookings growth was 23% year-on-year, which was a slowdown from last quarter’s 26% growth. Investors were hoping for even more, and shares traded down 11.2% to $182.36 immediately following the results.<\/p>\n Manhattan Associates Billings <\/p>\n