CyberArk Software reported first quarter earnings and revenue that topped Wall Street targets amid its shift to a new subscription-based business model. The cybersecurity firm's guidance came in slightly above expectations. CyberArk stock fell on the news.
The company reported March-ended quarter earnings before the market open. CyberArk earnings in the March quarter rose 30% to 98 cents on an adjusted basis. Including acquisitions, revenue climbed 43% to nearly $318 million.
Analysts expected CyberArk earnings of 79 cents a share on sales of $305 million.
Key Financial Metric
For CyberArk, subscription-based annual recurring revenue is a key financial metric.
In the March quarter, total ARR rose 50% year over year to $1.215 billion vs. estimates of $1.202 billion.
For the current June-ending quarter, CyberArk forecast revenue of $315 million at the midpoint of guidance versus estimates of $310 million.
CyberArk is the industry leader in privileged access management, also known as PAM. But it has built a broad identity security platform, spanning workforce and customer access, endpoint privilege security, and cloud computing privilege security and identity management.
Big Acquisition
Hackers often aim to compromise networks by targeting insiders — employees or management with administrative access to company computer systems. As a result, more companies are shifting cybersecurity budgets to "identity and access management" tools that address insider threats.
CyberArk competes with Microsoft, Okta, CrowdStrike Holdings, privately held Thycotic and several other companies.
CyberArk in 2024 announced the $1.5 billion acquisition of Venafi, targeting the market in Internet of Things — web-connected devices in factories, agriculture, telemedicine, retail stores, food services and other applications. Salt Lake City-based Venafi is a key player in so-called machine identity management.
CyberArk Stock
On the stock market today, CyberArk stock fell 4.5% to 351 in premarket trading. Shares are in a cup base with a 421 buy point. On Monday, shares climbed 2.3% to 367.33, briefly clearing an early entry of 369.30.
The IBD Computer-Software Security group ranks No. 10 out of 197 industry groups that IBD tracks.
Also, CyberArk stock holds a Composite Rating of 93 out of a best-possible 99, according to IBD's Stock Checkup.
IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
CyberArk stock holds an Accumulation/Distribution Rating of B. The institutional ownership rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A+ signifies heavy institutional buying; E means heavy selling.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
