Shares of Qualtrics (NASDAQ:XM) are up more than 4% in premarket trading Friday after the company reported better-than-expected Q1 revenue and issued an upbeat Q2 revenue forecast.
XM reported Q1 revenue of $335.6 million, up 41% YoY and topping the consensus estimates of $325.6 million. Loss per share stood at 51c in the period.
For Q2, Qualtrics expects revenue in the range of $344 million to $346 million, beating the analyst expectations of $337.4 million. XM expects Q2 EPS in the range of -1c to +1c, compared to the estimates of 0.3c per share.
For the full year, Qualtrics anticipates revenue to be around $1.43 billion, compared to analyst expectations of $1.41 billion and the company’s previous outlook of $1.40 billion to $1.41 billion.
Morgan Stanley analyst Keith Weiss lowered the price target to $43.00 per share from $54.00, although she remains positive on XM after the company delivered results that are “never more relevant than in uncertain times.”
“XM delivered a Q1 revenue beat & Q2/FY22 raise in the face of demand concerns from an uncertain macro environment. Solid billings growth, NRR stabilizing at record highs & sustained demand as customers look for insight to navigate uncertain times provides confidence in outperformance vs FY22 targets,” Weiss said in a client note.
BofA analyst Adam Bergere also lowered the PT to $34.00 per share from $40.00 to reflect the lower multiple. The analyst saw a “solid beat and raise” fueled by impressive execution.
“We were impressed with the Q1 results, full year guidance raise, and the company’s positive tone on the current demand environment despite some disruption in Europe (“a few customers in Europe who were hesitant to pull the trigger on deals and delayed into the following quarter”). Q1 results confirm our view that Qualtrics carries a leadership position in a large TAM (total addressable market) and continues to take share,” the analyst wrote in a memo.
Similarly, Raymond James analyst Brian Peterson also reflected positively on XM.
“With a ramping product portfolio and key partnership opportunities, we believe that XM will remain on a 30% growth trajectory for the foreseeable future, which isn’t reflected in shares at 8x (vs. the 30%+ growth group at 10x).”
By Senad Karaahmetovic