Cloudera earnings Q4 2019

Earnings


Michael Nagle | Bloomberg | Getty Images

Tom Reilly, chief executive officer of Cloudera Inc., stands during the company’s initial public offering (IPO) on the floor of the New York Stock Exchange (NYSE) in New York.

Cloudera plummeted as much as 15 percent in extended trading on Wednesday after the developer of software for managing and analyzing large amounts of data provided an outlook that disappointed investors.

It’s Cloudera’s first earnings report since closing the $5.2 billion merger with smaller rival Hortonworks. The company said that the combined entity will generate revenue of up to $190 million in the first quarter and as much as $855 million for the year.

Not all analysts have published estimates for the combined company, but some of those who have were expecting bigger numbers. Analysts at BTIG predicted in a note on Tuesday that sales would reach $207 million in the first quarter and $940 million for the year. D.A. Davidson analysts said last week that revenue this calendar year (one month off from Cloudera’s fiscal year) would be $920 million.

Cloudera and Hortonworks, the two most prominent vendors of Hadoop open-source software, came together so they could cut down on the costs of going head-to-head and join forces in taking on Amazon Web Services, which is bolstering its database offerings. The shares had gained 32 percent this year as of Wednesday’s close.

“The elimination of the massive product overlap between the two companies could drive increasing standardization of the Hadoop stack and therefore remove barriers to consumption, which in turn could increase demand,” wrote Edward Parker of BTIG, who has a “buy” rating on the stock.

But making money remains a challenge. Cloudera forecast a first-quarter loss, excluding some items, of up to 25 cents a share and as high as 36 cents a share for the year, according to a statement.

Cloudera CEO Tom Reilly said on the call with analysts on Wednesday that the teams have been combined but there are still administrative and other developments in the works.

“From an operations perspective, only back office systems integration and facilities consolidation remain,” Reilly said.

For the fourth quarter, ending Jan. 31, Cloudera reported a loss of 15 cents a share on revenue of $144.5 million. The company said that Hortonworks, which officially joined at the beginning of January, contributed $15 million of sales in the period.

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