Why SVMK Stock Fell Today

What happened

Shares of SVMK (NASDAQ: SVMK) have fallen today, down by 7% as of 1:30 p.m. EST, after the SurveyMonkey parent reported third-quarter earnings. The company lost less than expected but guided fourth-quarter sales below Wall Street’s forecasts.

So what

Revenue in the third quarter came in at $79.3 million, which was right on target with what analysts were modeling for. That led to an adjusted net loss of $36,000, which rounded to breakeven per share, better than the $0.05 per share in red ink that investors were expecting. Paying users increased 15% to over 713,000 and enterprise sales accounted for 23% of revenue.

Image source: Getty Images.

In a statement, CEO Zander Lurie said:

SurveyMonkey’s strong Q3 results underscore that feedback is a necessity for any business that values its stakeholders. This quarter, we added more than 500 new customers to our growing enterprise roster, including Zoom, IBM and Thule Sweden, and we scaled enterprise sales to 23% of total revenue. We maintained solid execution on both driving adoption of our collaborative self-serve Teams plans and expanding our international footprint, as promised at our IPO one year ago.

Now what

Guidance for the fourth quarter was a little light, however. Revenue is expected in the range of $83 million to $84 million, so the online survey software maker will need to top that outlook to hit the consensus estimate of $84.1 million. Adjusted operating margin is forecast at negative 1% to negative 3%.

SurveyMonkey made two acquisitions this year: Usabilla and GetFeedback. These purchases are expected to represent 4% of revenue this year, and the company says the acquisitions will be “broadly integrated into our product and go-to-market portfolio by 2020.”

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Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Zoom Video Communications. The Motley Fool is short shares of IBM and recommends the following options: long January 2020 $200 calls on IBM, short January 2020 $200 puts on IBM, and short January 2020 $155 calls on IBM. The Motley Fool has a disclosure policy.

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