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Domo (DOMO) to Report Q3 Earnings: What's in the Cards?

Domo, Inc. DOMO is set to report third-quarter fiscal 2020 results on Dec 5.

For the third quarter, Domo expects revenues between $41.5 million and $42.5 million. Non-GAAP net loss is expected between $1 and $1.04 per share.

The Zacks Consensus Estimate for third-quarter earnings per share is pegged at a loss of $1.02.

The consensus mark for revenues stands at $42 million, indicating an increase of 14% from the year-ago reported figure.

In the last reported quarter, the company posted non-GAAP loss of 96 cents per share, significantly narrower than the year-ago quarter’s loss of $3.44 and the Zacks Consensus Estimate of a loss of $1.

Revenues of $41.7 million increased 21.6% on a year-over-year basis and beat the consensus mark by 1.7%.

Let’s see how things have shaped up for this announcement.

Domo, Inc. Price and EPS Surprise

Domo, Inc. Price and EPS Surprise

Domo, Inc. price-eps-surprise | Domo, Inc. Quote

Factors to Watch

Domo’s expanding clientele, particularly enterprise customers, are expected to have driven the top line in the to-be-reported quarter. Additionally, the company’s expanding service offerings based on a solid partner base is a key catalyst.

Notably, at the end of the second quarter, 49% of customers were on multi-year contracts compared with 38% at the end of the year-ago quarter.

Moreover, the company expects operating expenses to decline in the third quarter, which is expected to have boosted profitability.

Key Q3 Developments

During the to-be-reported quarter, Domo announced Domo for Square, a new application that helps merchants with multiple Square accounts to easily unlock business insights and value from all Square data in real-time.

The company’s partner base expanded in the third quarter and now includes The Assurance Financial Group, Amazon Web Services, Google, Azure, LinkedIn, Box, Cooper, Octane, and Zendesk.

Domo also inked a partnership with Snowflake, the data warehouse built for the cloud that combines the power of data warehousing, the flexibility of big data platforms and the elasticity of the cloud at a fraction of the cost of traditional solutions.

Moreover, Domo continued to win accolades in the to-be-reported quarter. The company was ranked #1 as an overall experience leader and a credibility leader by Dresner Advisory Services’ 2019 Self Service Business Intelligence (BI) Market Study.

Further, it topped the BI Platforms category and was second among Enterprise BI platforms in Two New G2 Crowd Reports.

The awards reflect Domo’s growing popularity in the BI and analytics market.

Customer Additions in Q3

Notable customer additions during the to-be reported quarter include TaylorMade, a leading manufacturer of high-performance golf equipment.

Additionally, Swire Coca-Cola also chose Domo’s services to drive more value from business data across the organization. Swire Coca-Cola produces, sells and distributes Coca-Cola and other beverages to 60,000 retailers, and communities in 13 states across western America.

Moreover, Sony Bank Ltd. selected Domo’s enterprise-grade scale and security to use its cross-departmental data to power a more proactive and agile business.

What Our Model Says

According to the Zacks model, the right combination of two key ingredients — a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — increases the odds of a positive earnings surprise.

Domo has an Earnings ESP of 0.00% and a Zacks Rank #3, which makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks you may consider, as according to our proven model, these have the right mix of elements to beat estimates this time around.

Dollar General Corporation DG presently has an Earnings ESP of +1.23% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Costco Wholesale Corporation COST currently has an Earnings ESP of +1.01% and a Zacks Rank of 2.

The Cooper Companies, Inc. COO has an Earnings ESP of +0.74% and a Zacks Rank of 3 at present.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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