Nutanix Earnings Beat. Cloud Software Maker's Revenue Outlook Misses.

Core Viewpoint - Nutanix reported fiscal third-quarter earnings and revenue that exceeded consensus estimates, but the revenue guidance for the upcoming quarter fell short of expectations, leading to a significant drop in stock price [1][2]. Financial Performance - For the quarter ended April 30, Nutanix reported earnings of 28 cents per share on an adjusted basis, compared to 4 cents a year earlier, surpassing estimates of 17 cents [1]. - Revenue increased by 17% to $524.6 million, exceeding the expected $516 million [1]. - Free cash flow was reported at $78.3 million, which was below the estimated $85.5 million [1]. Future Guidance - For the current quarter ending in July, Nutanix projected revenue between $530 million and $540 million, which is below the consensus estimate of $546 million [1]. Key Metrics - Annual Contract Value (ACV) billings rose by 20% to $288.9 million, surpassing estimates of $271.5 million [3]. - Nutanix has transitioned to a software subscription business model, moving away from hardware appliance sales [3]. Market Performance - Nutanix stock experienced a decline of over 11% to $64.90 in extended trading following the earnings report [2]. - The stock has gained 51% in 2024 and is currently trading above a 5% buy zone, with an entry point of 66.98 [3]. - Nutanix holds a Relative Strength Rating of 97 out of a best-possible 99 [3].