What’s Happening with 8×8’s Shares?
According to the Motley Fool, the prices for shares of the leading cloud-based communications company dropped suddenly on the 30th of January, falling by a total of 10%.
The price plunge came shortly after 8×8 revealed their third-quarter fiscal earning results, which included a decision to reduce their outlook predictions for the year.
Why the Sudden Dip in Worth?
An evaluation of the third-quarter results for 8×8 shows a revenue income of around $89.9 million, which, as the Motley Fool pointed out, translates to a loss of about $0.06 per share (non-GAAP loss of $5.5 million). Before these results were announced, industry analysts had suggested that company would generate about $88.6 million in sales, so 8×8 came out a little bit ahead.
Revenue from the services section of the 8×8 business saw a significant increase of around 20%, ($85.9 million), and sales from larger enterprise customers buying more than $10,000 worth of monthly-recurring solutions jumped up by an incredible 61%. What’s more, the service revenue for each business customer in the mid-market and enterprise section rose to $5,211. All-in-all, the third-quarter results don’t seem bad enough to prompt such a significant share price plunge.
Are People Losing Faith in 8×8?
If you’re wondering why 8×8 saw such a severe hit in the stock market at the end of January, your guess is as good as ours. According to CEO Vikram Verma, the company delivered a pretty substantial quarter of growth and development. The quarter ended with 8×8 ahead of their financial predictions, and, as Verma noted, 8×8 are also in the process of disrupting a market with significant potential for profit. The cloud solutions environment is a $50 billion space.
So, why the change of heart for 8×8 investors? The Motley Fool suggests that it might be something to do with 8×8’s decision to reduce their forecast for the complete fiscal year of 2019. The prediction was decreased only slightly, from a range of $334 million to $338 million to a range of $334 million to $335 million. The company has also predicted that it’s non-GAAP loss for 2019 to be around $19 million.
Additionally, for the fourth quarter of the year, 8×8 has suggested that service revenue will deliver between $886 million and $89.6 million, with a pre-tax non-GAAP loss of $7 to $8 million.
We’ll have to wait and see whether any further announcements shed light on the confusing situation in the share market for 8×8.
source uctoday
Industry: Unified Communications News
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