In August, I initiated my coverage on Confluent, Inc. (NASDAQ: CFLT ) with a buy rating on its dip following Q2 earnings’ conservative guidance in light of the company’s growth potential in the data streaming market and its consumptionAs a former managing editor at a financial media publication focused on mid and small caps, I am using my experience to present investment opportunities in undervalued companies. My experience, combined with my academic background in financial markets and institutions, allows ...

Technical Analysis - Confluent (CFLT) has reached an important support level and surpassed resistance at the 200-day moving average, indicating a long-term bullish trend [1] - The 200-day simple moving average is a key indicator for determining overall long-term market trends for various financial instruments [1] Recent Performance - CFLT has moved 33.4% higher over the last four weeks, suggesting potential for further gains [2] - The company currently holds a Zacks Rank 3 (Hold), indicating a neutral outlook [2] Earnings Estimates - Positive earnings estimate revisions support a bullish case for CFLT, with no estimates decreasing in the past two months and two estimates increasing [2] - The consensus estimate for the current fiscal year has also increased, reinforcing the positive outlook [2][3] Investment Outlook - A combination of favorable earnings estimate revisions and key technical levels suggests that investors should monitor CFLT for potential gains in the near future [3]

Data streaming represents a big opportunity for investors, especially as artificial intelligence adoption grows.E-commerce websites, sports betting apps, and even stock trading platforms constantly feed real-time data to their users to create live experiences. That requires a specialized technology called data streaming, and Confluent (CFLT 1.56%) is an industry-leading provider.Demand for data streaming is only going to grow over time, especially as more businesses adopt artificial intelligence (AI), which ...

Financial Data and Key Metrics - Subscription revenue grew 27% YoY to $240 million, with Confluent Cloud revenue growing 42% YoY to $130 million [6] - Non-GAAP operating margin expanded approximately 12 percentage points to 6.3% [6] - Total revenue grew 25% YoY to $250 million, surpassing a $1 billion revenue run rate [6] - Subscription gross margin reached a record high of 82.2%, up 210 basis points, while total gross margin also reached a record high of 79% [25] - Free cash flow margin was 3.7%, expanding 10 percentage points [25] - Net income per share was $0.10 for Q3 using 353.6 million diluted weighted average shares outstanding [26] Business Line Data and Key Metrics - Confluent Platform revenue grew 13% YoY to $110.1 million, accounting for 46% of subscription revenue [22] - Confluent Cloud revenue accounted for 54% of subscription revenue, up from 48% a year ago [22] - Revenue from DSP (Data Streaming Platform) continued to grow substantially faster than overall cloud revenue [24] - 19 of the top 20 cloud customers have adopted at least 1 DSP product, and 13 have adopted products across all 3 categories [24] Market Data and Key Metrics - Revenue from the U.S. grew 28% YoY to $152.4 million, while revenue from outside the U.S. grew 21% YoY to $97.8 million [24] - The company serves more than 40% of the Fortune 500, including 10 of the top 10 U.S. banks, 8 of the top 8 global carmakers, and 9 of the top 10 U.S. insurance companies [10] Company Strategy and Industry Competition - The company is entering its third wave of growth, focusing on becoming a complete data streaming platform, a one-stop shop for all real-time data needs [14] - The acquisition of WarpStream adds a third deployment mechanism (BYOC) to the portfolio, targeting high-volume, high-tech customers [13] - The company is leveraging its relationship with OpenAI and other AI providers to drive growth in the generative AI landscape [9] Management Commentary on Operating Environment and Future Outlook - Management highlighted the stabilization of consumption in the digital native customer cohort and the adoption of new use cases and DSP products by larger cloud customers [22][28] - The company expects to exit 2024 with positive non-GAAP operating margin and positive free cash flow margin for the full year [31] - The intersection of cloud, data, and AI is seen as a critical driver for companies to deliver differentiated products and services in the AI era [32] Other Important Information - The company hosted Current 2024, its largest industry event dedicated to data streaming, with over 4,200 participants from 1,200 companies [6] - The company launched the Confluent for Start-ups AI Accelerator program, providing early-stage AI companies with tools, mentorship, and product credits [8] - The company announced Investor Day 2025, to be held on March 6, 2025, in San Francisco [33] Q&A Session Summary Question: Digital Native Customer Confidence - Management noted stabilization in the digital native segment, with customers shifting focus from cost optimization to new use case implementation [35] Question: Flink Adoption and Use Cases - Flink adoption is ramping up, with early production use cases being implemented by both Confluent Cloud and Confluent Platform customers [37][38] Question: Go-to-Market Strategy - The company has made significant progress in broadening its reach to open-source Kafka users, targeting high-propensity accounts and focusing on product-led growth [41][42] Question: Gen AI Demand - Gen AI demand is showing up in customer conversations, with growth in AI providers and new use cases in the enterprise customer base [45][46] Question: WarpStream Opportunity - WarpStream is seen as a key opportunity to bring large digital native companies into the Confluent ecosystem, particularly those using open-source Kafka [48] Question: NRR and Cloud Growth - NRR downticked slightly to 117%, but cloud growth remains strong, driven by stabilization in digital native consumption and adoption of DSP products [50][51] Question: Federal Business Performance - Federal business performance was reasonable, with limited impact due to the absence of Confluent Cloud in that vertical [69] Question: AI Use Cases and Competitive Positioning - AI use cases are emerging in two primary areas: gathering context data for AI and operationalizing background tasks using Flink [72][73] Question: Margin Progression and Product Innovation - The company expects to maintain efficient growth and profitability, with DSP products contributing to margin expansion as they scale [75][76] Question: Go-to-Market Improvements - The company has made aggressive adjustments to its go-to-market strategy, with a focus on consumption-based models and DSP product adoption [79][80] Question: Win Rates and Competition - Win rates have increased, particularly against smaller start-ups, with overall win rates well above 90% [82] Question: Net New ARR and WarpStream Adoption - Net new ARR for Confluent Cloud was strong, even excluding a one-time revenue benefit, driven by stabilization in digital native consumption and DSP adoption [84] - WarpStream adoption is expected to grow, including potential adoption by Confluent Platform customers moving away from on-prem deployments [86] Question: Gross Margins and DSP Impact - Gross margins remain strong, with DSP products expected to contribute positively to margins as they scale [88][89] Question: Digital Native Demand Recovery - Recovery in demand from digital native customers is driven by both project rollovers and the company's go-to-market transformation [95][96] Question: Financial Services Strength - Strength in financial services is driven by continued investment in real-time data platforms, with no signs of slowdown [99][100] Question: New Customer Expansion - New customer expansion is expected to follow a land-and-expand model, with a focus on progressing customers to higher ARR tiers [101][102]

For the quarter ended September 2024, Confluent (CFLT) reported revenue of $250.2 million, up 25% over the same period last year. EPS came in at $0.10, compared to $0.02 in the year-ago quarter. The reported revenue represents a surprise of +2.55% over the Zacks Consensus Estimate of $243.98 million. With the consensus EPS estimate being $0.05, the EPS surprise was +100.00%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Stree ...

Confluent (CFLT) came out with quarterly earnings of $0.10 per share, beating the Zacks Consensus Estimate of $0.05 per share. This compares to earnings of $0.02 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 100%. A quarter ago, it was expected that this data infrastructure software maker would post earnings of $0.05 per share when it actually produced earnings of $0.06, delivering a surprise of 20%.Over the last four quarte ...

Revenue and Growth - Confluent's revenue for the three months ended September 30, 2024 was $250.2 million, representing a 25% year-over-year growth[90] - Confluent's revenue for the nine months ended September 30, 2024 was $702.4 million, representing a 25% year-over-year growth[90] - Subscription revenue for Q3 2024 was $239.851 million, up from $189.270 million in Q3 2023[113] - Total revenue for Q3 2024 reached $250.199 million, compared to $200.181 million in Q3 2023[113] - Subscription revenue increased by $50.6 million (27%) to $239.9 million in Q3 2024 compared to Q3 2023, driven by sales to existing and new customers[118] - Total revenue grew by $50.0 million (25%) to $250.2 million in Q3 2024, with Confluent Cloud contributing 54% of subscription revenue[118] - Subscription revenue increased by $145.1 million (28%) to $671.5 million in the nine months ended September 30, 2024[131] - Total revenue grew by $138.7 million (25%) to $702.4 million in the nine months ended September 30, 2024[131] - Revenue for the nine months ended September 30, 2024 was $702.4 million, compared to $563.8 million for the same period in 2023[167] - Revenue for the year ended December 31, 2023 was $777.0 million, up from $585.9 million in 2022 and $387.9 million in 2021[167] - The company's revenue growth rate has declined at times and may continue to decline due to macroeconomic challenges and increased competition[167] - The company expects revenue growth rate to decline in future periods due to rapid revenue growth in prior periods[169] Customer Metrics - Confluent had approximately 5,680 customers as of September 30, 2024, representing a 16% year-over-year growth[90] - Confluent had 1,346 customers with $100,000 or greater in Annual Recurring Revenue (ARR) as of September 30, 2024[101] - Confluent's customer base grew from 4,910 to 5,680 customers from September 30, 2023 to September 30, 2024[90] - Confluent's customers with $100,000 or greater in ARR grew from 1,185 to 1,346 from September 30, 2023 to September 30, 2024[101] - Dollar-Based Net Retention Rate (NRR) was 117% as of September 30, 2024, indicating strong expansion within existing customers[102] - Dollar-based net retention rate was 117% as of September 30, 2024, indicating strong expansion from existing customers[118] - As of September 30, 2024, the company had 1,346 customers, with 1,229 customers having $100,000 or greater in ARR[230] - The company’s success depends on existing customers renewing subscriptions, expanding usage, and purchasing additional products, with dollar-based net retention rates historically fluctuating[234] Confluent Cloud - Confluent Cloud revenue represented 52% of total revenue for the three months ended September 30, 2024[94] - Confluent Cloud revenue represented 51% of total revenue for the nine months ended September 30, 2024[94] - Confluent Cloud revenue grew from 46% to 52% of total revenue from the three months ended September 30, 2023 to September 30, 2024[94] - Confluent Cloud revenue grew from 44% to 51% of total revenue from the nine months ended September 30, 2023 to September 30, 2024[94] - Confluent Cloud revenue growth is expected to fluctuate due to usage-based nature, customer adoption trends, and shift to a consumption-oriented sales model[177] - New customers acquired in 2023 tend to have lower initial consumption, potentially impacting revenue and growth rates[177] - Confluent Cloud historically had lower average pricing compared to Confluent Platform, affecting financial results[177] - Company targets small to medium-sized companies for faster deployment and shorter sales cycles for Confluent Cloud[179] - Larger enterprise customers' reduced consumption has negatively impacted Confluent Cloud growth and forecasts[179] - Fluctuations in Confluent Cloud usage under usage-based commitments and pay-as-you-go arrangements may impact financial results[186] - Customer retention and consumption expansion are critical for Confluent Cloud growth, particularly among large customers[186] - Confluent Cloud sales historically smaller, targeting small to medium-sized companies[191] - Larger Confluent Cloud sales may result in greater usage level variations[191] Financial Performance - Gross profit for Q3 2024 was $186.496 million, up from $143.632 million in Q3 2023[113] - Operating loss for Q3 2024 improved to $93.663 million from $108.632 million in Q3 2023[113] - Net loss for Q3 2024 was $74.144 million, compared to $92.670 million in Q3 2023[113] - Gross margin improved to 75% in Q3 2024 from 72% in Q3 2023[116] - Gross profit increased by $42.9 million (30%) to $186.5 million in Q3 2024, with total gross margin improving to 75%[119] - Total gross margin improved to 73% from 69% for the nine months ended September 30, 2024[133] - The company generated net losses of $442.7 million, $452.6 million, and $342.8 million for the years ended December 31, 2023, 2022, and 2021, respectively[170] - The company had an accumulated deficit of $1,901.2 million as of September 30, 2024[170] - Accumulated deficit stood at $1,901.2 million as of September 30, 2024[145] Expenses - Research and development expenses increased to $102.720 million in Q3 2024 from $91.237 million in Q3 2023[113] - Sales and marketing expenses rose to $137.968 million in Q3 2024 from $128.624 million in Q3 2023[113] - Research and development expenses rose by $11.5 million (13%) to $102.7 million in Q3 2024, primarily due to increased personnel costs[121] - Sales and marketing expenses increased by $9.3 million (7%) to $138.0 million in Q3 2024, driven by higher personnel and travel costs[122] - General and administrative expenses grew by $7.6 million (24%) to $39.5 million in Q3 2024, mainly due to increased personnel costs[124] - Research and development expenses increased by $44.5 million (17%) to $306.4 million for the nine months ended September 30, 2024[135][137] - Sales and marketing expenses increased by $17.2 million (4%) to $402.2 million for the nine months ended September 30, 2024[136][137] - General and administrative expenses increased by $13.8 million (13%) to $117.3 million for the nine months ended September 30, 2024[138][137] - Restructuring and other related charges decreased by $34.9 million (100%) for the nine months ended September 30, 2024[140][142] - Other income, net increased by $14.9 million (30%) to $65.2 million for the nine months ended September 30, 2024[141][142] Cash and Liquidity - Net cash used in operating activities decreased to $1.8 million from $115.9 million for the nine months ended September 30, 2024[146][148] - Cash and cash equivalents totaled $1,859.5 million as of September 30, 2024[145] - Cash, cash equivalents, and marketable securities totaled $1,859.5 million as of September 30, 2024[155] - Issued $1.1 billion in 0% convertible senior notes due 2027 in December 2021[155] Risks and Challenges - The company's business depends on existing customers renewing subscriptions and expanding usage of its offerings[166] - The company faces risks related to its dual-class stock structure, which concentrates voting control with pre-IPO stockholders[166] - The company faces competition from public cloud providers like AWS, Azure, and GCP, which could embed innovations or bundle competing products[183] - Open source alternatives, including Apache Kafka, pose significant competition in the data streaming platform market[183] - Company competes on factors like ease of deployment, cloud-native capabilities, and flexible pricing such as pay-as-you-go[184] - ARR calculation methodology changed in Q1 2023, impacting NRR and customers with over $100,000 in ARR[189] - Confluent Cloud revenue contribution increasing, leading to higher NRR volatility[189] - Revenue recognition timing less predictable due to customer flexibility in Confluent Cloud consumption[189] - Macroeconomic impacts causing longer sales cycles and consumption volatility from enterprise customers[191] - Significant portion of revenue recognized ratably over Confluent Platform subscription term[192] - Professional services business growth requires margin improvement to avoid harm to financial condition[198] - Seasonality affects RPO and new customer bookings, particularly in Q4[200] - Government sales subject to compliance challenges and risks, including FedRAMP authorization[202] - Potential challenges in integrating acquired businesses, technologies, and personnel[204] - Additional capital may be required to support business growth, with uncertain availability on favorable terms[205] - Increasing focus on ESG factors may impose additional costs and expose company to new risks[206] - Remote work environment increases risk of industrial espionage, phishing, and cybersecurity attacks[212] - Reliance on third-party service providers introduces cybersecurity risks, including supply-chain attacks[212] - Codecov Breach in April 2021 resulted in unauthorized access to private Github repositories containing source code[212] - Security incidents could lead to loss of customer confidence, legal liabilities, and adverse business impacts[214] - Security incidents and third-party data collection could undermine the company's competitive advantage and market position[215] - Potential defects or errors in the data streaming platform could damage customer businesses and harm the company's reputation[216] - Interruptions or performance problems in the offering may lead to customer loss and legal claims[217] - Growth depends on maintaining a reliable data streaming platform, with potential disruptions due to complexity or scale[218] - Compliance with evolving data privacy laws, such as CCPA and GDPR, could result in fines up to $7,500 per violation or 4% of global annual revenue[218][220] - Cross-border data transfer restrictions may increase operational costs and legal risks, with fines up to 1.2 billion Euros for non-compliance[220] - Use of GenAI technologies by employees may lead to additional compliance costs and regulatory actions[222] - Sales and marketing efforts are critical for expanding the customer base and achieving market adoption of Confluent Cloud[224] - Transition to a consumption-oriented sales model may cause attrition in the sales organization and impact revenue forecasts[224] - The company faces risks in pricing models, including potential adverse effects on revenue and margins due to economic conditions like high inflation or recession[227] - Enterprise customers often require longer sales cycles, complex requirements, and substantial upfront costs, leading to less predictability in sales completion[230] - The company’s market opportunity estimates and growth forecasts are subject to significant uncertainty and may not accurately predict future growth[230] - The company’s brand recognition is critical for growth, especially in the face of competition from open-source alternatives and major cloud providers like AWS, Azure, and GCP[226] - The company’s offering is complex, requiring significant time and resources to train and familiarize potential customers, with no guarantee of purchase[230] - The company’s agreements with customers include indemnity provisions that could expose it to substantial liability for intellectual property claims or data protection issues[238] - The company’s service-level commitments in customer agreements, if unmet, could lead to customer terminations, reduced renewals, and reputational damage[238] - The company uses third-party open source software like Apache Kafka and Apache Flink, which could lead to litigation or compliance issues[240] - Competitors may develop similar or superior products based on Apache Kafka or Apache Flink, potentially reducing market share and pricing power[242] - The company faces risks of intellectual property disputes, which could result in costly litigation or the need to redesign offerings[247] - The company’s limited patent portfolio may not deter infringement claims or provide competitive advantages[243] - Unauthorized use of the company’s proprietary technology by third parties could harm its business and financial condition[244] - The company may be required to publicly release proprietary source code if found non-compliant with open source licenses[240] - The company’s reliance on open source software exposes it to security risks and potential vulnerabilities[240] - Intellectual property rights in foreign countries may be less protective, increasing risks of unauthorized copying[244] - The company’s ability to enforce intellectual property rights may be limited due to legal uncertainties and enforcement challenges[243] - The company’s exposure to intellectual property claims is likely to grow as its market expands, increasing potential liabilities[247] - Confluent Cloud relies entirely on third-party cloud infrastructure providers AWS, Azure, and GCP, with any disruptions potentially harming the company's business and financial condition[249] - 40% of the company's revenue for the nine months ended September 30, 2024, and the year ended December 31, 2023, was generated from customers outside the United States[258] - Approximately 45% of the company's full-time employees are located outside the United States, with 18% in India and 8% in the UK as of September 30, 2024[258] - The company faces risks from currency exchange rate fluctuations, particularly as a strengthening U.S. dollar could increase the real cost of its offerings to international customers[261] - The company hedges a portion of operating expenses denominated in foreign currencies to mitigate risks from exchange rate fluctuations[261] - International expansion efforts may require establishing new channel partnerships, with failure to do so potentially hindering growth plans[258] - The company's reliance on SaaS technologies for critical business functions exposes it to risks from service interruptions or unavailability[252] - Competition for highly skilled personnel, especially in cloud infrastructure and sales, poses challenges to the company's growth and operations[255] - The company's international operations are subject to risks such as political instability, regulatory changes, and data privacy laws[260] - The company's growth strategy includes adapting to and developing strategies for international markets, but success is not guaranteed[258] - The company is subject to U.S. export controls and economic sanctions, which could delay or prevent sales to certain countries, impacting international market expansion[262] - The company faces risks related to anti-corruption and anti-bribery laws, with potential liabilities from third-party intermediaries or employees violating these laws[264] - International operations may lead to greater than anticipated tax liabilities due to challenges in transfer pricing and intercompany transactions[266] - Changes in tax laws, including the OECD/G20 Pillar Two 15% global minimum tax, could increase the company's tax expense in future years[267] - The company has net operating loss (NOL) carryforwards of $1,461.7 million (federal) and $798.1 million (state), with limitations on their utilization due to potential ownership changes[269][270] - The company’s effective tax rate could increase due to changes in tax laws, treaties, or the outcome of tax audits and examinations[271] - The dual-class stock structure concentrates 73.1% of voting power with Class B shareholders, limiting influence for Class A shareholders[275] - The CEO controls 22.0% of the company's voting power despite owning only 7.3% of the total shares[275] - Up to 26,047,378 shares of Class B and 22,337,563 shares of Class A may be issued upon exercise of stock options or vesting of RSUs[280] - 55,317,490 shares of Class A common stock are available for future issuance under the 2021 Plan and 2021 ESPP[280] - The company's 0% convertible senior notes due 2027 may dilute ownership if converted into Class A shares[280] - The company does not intend to pay dividends in the foreseeable future, relying solely on stock price appreciation for investor returns[280] - The company incurs significant costs for public company compliance, including Sarbanes-Oxley and Dodd-Frank Act requirements[280] - Anti-takeover provisions in the charter documents require 66 2/3% shareholder approval for certain amendments, limiting control changes[282] - Section 203 of Delaware law restricts business combinations with interested stockholders for three years[282] - The company's stock price may be volatile due to factors like financial performance, market conditions, and competitor actions[277] - The company's amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware and the federal district courts of the United States as exclusive forums for certain disputes[284] - The exclusive forum provisions may limit stockholders' ability to bring claims in favorable judicial forums[284] - The company expects to vigorously assert the validity and enforceability of the exclusive forum provisions in case of disputes[284] - Significant additional costs may be incurred if the exclusive forum provisions are found inapplicable or unenforceable[284] Strategic Initiatives - The company plans to expand to new international markets and grow within existing markets[169] - The company intends to continue significant investments in product development, including new offerings and features[170] - The company acquired WarpStream Labs, Inc. in September 2024, adding their BYOC data streaming solution to the offering[175] - Company acquired WarpStream in September 2024, integrating their BYOC data streaming solution[204] - Proceeds from IPO and convertible notes offering increase likelihood of larger and more complex acquisitions[204] - Published annual ESG Report since 2022, detailing greenhouse gas emissions and carbon neutrality efforts[208] Competition - Company faces competition from public cloud providers like AWS, Azure, and GCP, which could embed innovations or bundle competing products[183] - Open source alternatives, including Apache Kafka, pose significant competition in the data streaming platform market[183] - Company competes on factors like ease of deployment, cloud-native capabilities, and flexible pricing such as pay-as-you-go[184] - Competitors may develop similar or superior products based on Apache Kafka or Apache Flink, potentially reducing market share and

Revenue Growth - Subscription revenue reached $240 million, up 27% year over year[1] - Confluent Cloud revenue grew to $130 million, up 42% year over year[1] - Total revenue for Q3 2024 was $250.2 million, up 25% year over year[3] - Total revenue for Q3 2024 increased to $250.2 million, up 25% from $200.2 million in Q3 2023[14] - Subscription revenue grew to $239.9 million in Q3 2024, a 26.7% increase from $189.3 million in Q3 2023[14] - Confluent Cloud revenue growth driven by increased adoption of data streaming platforms[7] Customer Metrics - 1,346 customers with $100,000 or greater in ARR, a 14% year-over-year increase[1] Financial Performance - Non-GAAP operating income improved to $15.8 million from a loss of $10.9 million in Q3 2023[3] - Free cash flow margin improved to 3.7% from -6.5% in Q3 2023[3] - Net loss improved to $74.1 million in Q3 2024, compared to a net loss of $92.7 million in Q3 2023[14] - GAAP operating loss for Q3 2024 was $93.7 million, compared to $108.6 million in Q3 2023, with GAAP operating margins improving from -54.3% to -37.4%[19] - Non-GAAP operating income for Q3 2024 was $15.8 million, a significant improvement from a loss of $10.9 million in Q3 2023, with non-GAAP operating margins improving from -5.5% to 6.3%[19] - GAAP net loss for Q3 2024 was $74.1 million, compared to $92.7 million in Q3 2023, while non-GAAP net income improved to $34.8 million from $6.3 million in the same period last year[19] - Free cash flow for Q3 2024 was $9.3 million, a significant improvement from a negative $13.1 million in Q3 2023, with free cash flow margins improving from -6.5% to 3.7%[20] - Net cash provided by operating activities in Q3 2024 was $15.6 million, compared to a negative $9.1 million in Q3 2023[20] Guidance and Targets - Q4 2024 subscription revenue guidance raised to $245-$246 million[4] - Full-year 2024 subscription revenue guidance updated to $916.5-$917.5 million[4] - Non-GAAP operating margin targeted to be positive for 2024[2] Cash Flow and Liquidity - Cash and cash equivalents decreased to $322.6 million as of September 30, 2024, down from $349.8 million at the end of 2023[13] - Marketable securities remained stable at $1.54 billion as of September 30, 2024, compared to $1.55 billion at the end of 2023[13] - Net cash provided by operating activities for the three months ended September 30, 2024, was $15.6 million, compared to a net cash used of $9.1 million in the same period in 2023[16] - Purchases of marketable securities for the three months ended September 30, 2024, were $273.2 million, compared to $235.8 million in the same period in 2023[16] - Cash paid for business combinations, net of cash acquired, for the three months ended September 30, 2024, was $115.5 million, compared to $0 in the same period in 2023[16] - Capital expenditures in Q3 2024 were $607,000, compared to $363,000 in Q3 2023[20] - Net cash used in investing activities in Q3 2024 was $21.9 million, compared to $11.5 million in Q3 2023[20] - Net cash provided by financing activities in Q3 2024 was $17.2 million, compared to $26.2 million in Q3 2023[20] Operating Expenses - Total operating expenses for Q3 2024 were $280.2 million, up 11.1% from $252.3 million in Q3 2023[14] - Research and development expenses increased to $102.7 million in Q3 2024, up 12.6% from $91.2 million in Q3 2023[14] - Stock-based compensation-related charges totaled $101.8 million in Q3 2024, up 10.7% from $92.0 million in Q3 2023[15] - Stock-based compensation for the three months ended September 30, 2024, was $98.3 million, up from $89.5 million in the same period in 2023[16] - Non-GAAP research and development operating expense as a percentage of total revenue for the three months ended September 30, 2024, was 21.8%, down from 24.4% in the same period in 2023[18] - Non-GAAP sales and marketing operating expense as a percentage of total revenue for the three months ended September 30, 2024, was 41.7%, down from 47.2% in the same period in 2023[18] Balance Sheet and Assets - Accounts receivable increased to $278.7 million as of September 30, 2024, up 21.2% from $230.0 million at the end of 2023[13] - Total assets grew to $2.61 billion as of September 30, 2024, up 6% from $2.46 billion at the end of 2023[13] Gross Margins - Total gross margin on a GAAP basis for the three months ended September 30, 2024, was 74.5%, up from 71.8% in the same period in 2023[17] - Non-GAAP total gross margin for the three months ended September 30, 2024, was 79.3%, compared to 76.4% in the same period in 2023[18]

When preparing for the last 2 months in 2024, I would expect the following to happen: 1) a post-election market rally, which could be fueled by large inflow of the huge money on the sideline; 2) more rate cuts Advanced education in economics, business management and engineering. Professional experience with product management and development in high tech industry, including advisory with multiple fintech startups. Have been investing in growth companies since 1998. Recent interest of investment also include ...

These stocks are trading at attractive valuations relative to their history, especially in light of their opportunities in the artificial intelligence space. Wall Street doesn't always get things right, but it can be useful to pay attention when analysts reach a consensus on a particular stock. Sometimes, it can suggest potential upside on the horizon. The majority of the analysts tracked by The Wall Street Journal have given shares of Zscaler (ZS 0.49%) and Confluent (CFLT 0.05%) the highest possible buy r ...