Splunk’s loss widens to £150 million in Q3 as the COVID-19 crisis hits sales

Written by: Wajeeh Khan
December 2, 2020
  • Splunk’s loss widens to £150 million in Q3 as the COVID-19 crisis hits sales.
  • The American multinational reports £417.83 million of revenue in fiscal Q3.
  • Splunk says total costs saw a 27% annualised increase in the third quarter.

Splunk Inc. (NASDAQ: SPLK) reported a broader loss on Wednesday for the fiscal third quarter as sales took a hit amidst the Coronavirus pandemic that pushed companies into work from home arrangements. Splunk also said that expenses were higher in the recent quarter weighing further on its financial performance.

Shares of the company tanked close to 20% in after-hours trading on Wednesday, Including the price action, Splunk Inc. is now exchanging hands at £124 per share that represents an about 10% growth year to date in the stock market this year.

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In comparison, Splunk’s shares that you can learn to buy online here had plummeted to £71.59 in March when the impact of the Coronavirus pandemic was at its peak.  

Splunk’s Q3 financial results versus analysts’ estimates

Splunk reported £150.72 million of loss in the third quarter that translates to 94 pence per share. In comparison, its loss was capped at a much lower £43.08 million in the same quarter last year or 28.42 pence per share. FactSet Consensus for per-share loss in the recent quarter stood at 76 pence.

In terms of revenue, the American multinational posted £417.83 million in the third quarter versus the year-ago figure of £468.47 million. Analysts had forecast a higher £458.52 million of revenue for Splunk in Q3. In the prior quarter (Q2), Splunk Inc. had registered £368 million of total revenue, as per the report published in the last week of August.

Splunk also said on Wednesday that its revenue from cloud services jumped 80% in the recent quarter to £108.24 million. Licensing revenue, on the other hand, printed at £179.67 million in the third quarter or over 35% lower on a year over year basis.

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Splunk says total costs saw a 27% increase in the third quarter

According to Splunk, total costs saw a 27% annualised increase in Q3 to £102.33 million. At £439.30 million, expenses surged 3.8% in the recent quarter. The San Francisco-based company’s annual recurring revenue jumped 44% in the third quarter to £1.55 billion.

In separate news from the United States, the electronic design automation company, Synopsys Inc., said on Wednesday that its revenue jumped 9.6% in fiscal 2020.

Splunk performed largely upbeat in the stock market last year with an annual gain of roughly 45%. At the time of writing, the U.S. company had a market cap of £24.71 billion.