It was a Thursday, that most middling of days, when the shares of Domo (DOMO) decided to embark on what I can only describe as a spirited retreat southward-a dash so swift it might have impressed an Olympic hurdler. By 12:30 p.m. ET, the stock had tumbled a full 11.7%, leaving investors clutching their ledgers and wondering if they’d accidentally bet on the wrong horse at Ascot.
Ah, but here’s where things take a turn for the curious. You see, Domo-the software specialist with more acronyms in its product line than a Scrabble champion has tiles-had just delivered earnings results that, by all accounts, were not entirely dreadful. In fact, they rather outpaced Wall Street’s expectations. Sales? Tick. Earnings? Double tick. And yet, the market greeted these tidings with all the enthusiasm of a cat confronted with a bath. Why, you ask? Well, my dear reader, it seems the culprit lies in the company’s guidance, which struck many as being about as optimistic as a weather forecast predicting rain during the Wimbledon finals.
A Profitable Quarter, Yet Shares Plummet
To be precise, Domo managed an adjusted earnings per share of $0.02 on sales of $79.7 million in the second quarter-a feat akin to finding one’s umbrella still intact after a particularly gusty storm. This performance handily beat analyst estimates, which had foreseen a loss of $0.04 per share on revenue of $79 million. Revenue itself rose by a modest 1.7% year over year, while the profit represented a marked improvement from last year’s second-quarter deficit of $0.07 per share. Moreover, the company ended the period with remaining performance obligations (RPO) of $409.8 million, up a sprightly 19%. One might think such numbers would elicit cheers, or at least polite applause, but alas, the market proved immune to charm this time around.
What soured the mood, you inquire? It appears Domo’s forward-looking statements lacked the sort of razzle-dazzle required to keep the wolves at bay. Investors, those persnickety creatures, prefer their optimism served piping hot, not lukewarm with a side of caution. The company’s near-term outlook, it seems, failed to pass muster, much like a debutante arriving at a ball wearing last season’s frock.
The Road Ahead for Domo
For the third quarter, Domo has guided for revenue between $78.5 million and $79.5 million, coupled with an adjusted loss per share ranging from $0.03 to $0.07. For the full year, management expects sales to land between $316 million and $320 million, with losses narrowing somewhat to between $0.11 and $0.19 per share. Additionally, the company plans to reduce its outstanding share count to 41 million by year-end, down from the projected 41.5 million for Q3. A buyback of 500,000 shares is in the works-a move some interpret as a sign that Domo believes its stock is languishing below its true worth. Whether this will prove to be a masterstroke or merely another shuffle in the deck remains to be seen.
And so, we find ourselves at the end of this little tale, wherein Domo, our hapless protagonist, finds itself temporarily in the soup. But fear not, gentle reader, for markets are nothing if not capricious, and tomorrow may bring brighter skies-or at least less gloomy ones. 🌤️
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2025-08-28 20:27