Slack (WORK) Q2 2020 earnings

Shares of Slack, the maker of the popular workplace chat application, dropped 16% on Wednesday after the company released its first earnings report as a public company, briefly passing below the benchmark price of his direct inscription.

Here are the key figures:

• Earnings: Loss of 14 cents per share, excluding certain items, against 18 cents as expected by analysts, according to Refinitiv.
• Returned: $ 145 million, against $ 140.7 million as expected by analysts, according to Refinitiv.

Slack said in a statement that its revenues had increased 58% over the second quarter of fiscal year 2020, ended July 31.

Slack debuted on the New York Stock Exchange in June through a direct listing, following the path taken by Spotify last year. A few days before listing, Slack had expected revenues of $ 139 million to $ 141 million in the second quarter, representing growth of about 52%.

The company's main competitor is Microsoft, which includes the Teams Networking application in the Office 365 Professional Subscriptions. In July, Microsoft released statistics suggesting that Teams is more widely used than Slack.

"We believe that the Slack and Microsoft teams have the same chance of developing as alternatives to traditional email and that a duopoly-like market structure could form around the two most popular applications." popular messaging at maturity ", analysts at KeyBanc Capital Markets analyze. Brent Bracelin wrote in a note to customers on August 25th.

The availability of Slack – a measure of how often the service is operating normally – went under 99.9% in June and July, writes KeyBanc analysts, who recommend buying the stock. Slack offers customers credits for future use when availability is less than 99.99%. These credits can have an impact on revenues. Slack said its revenue for the quarter had been negatively impacted by $ 8.2 million in credits.

For the third quarter of fiscal year, Slack calls for a loss of 8 to 9 cents per share, excluding items, and a turnover of $ 154 million to $ 156 million, reflecting revenue growth from 46% to 48%. Analysts surveyed by Refinitiv were expecting a tax loss of 7 cents per share in the third quarter, excluding certain items, on a $ 153.2 million business figure.

Slack is looking for a loss of 40 cents to 42 cents for the entire year, excluding some items, as well as revenue of $ 603 to $ 610 million, up from 51% to 52%. Analysts were expecting a 40-cent loss for the full year, excluding certainty, of $ 601 million in revenue. Slack shares jumped 49% in their debut on June 20, rising from a benchmark price of $ 26 to a close of $ 38.62. Since then, the stock is down about 20%.

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