What to expect when Cloudera (CLDR) reports Q4 earnings on March 10

Cloudera Inc. (NYSE: CLDR) is slated to report its fourth-quarter 2020 earnings results on Tuesday, March 10, after the market closes. The enterprise data cloud company has been struggling to turn profitable as there remained costs associated with the investments despite the absence of a proper turnaround strategy.

The top line will be beneficial by the subscription business backed by its ecosystem of technology partners, resellers, OEM, managed service providers, and independent software vendors. The company sells its platform to large enterprises globally as they capture and manage the vast majority of the world’s data and operate highly complex information technology environments.

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The company has significant revenue in the banking and financial services, manufacturing, technology, business services, telecommunications, public sector, consumer and retail, and healthcare and life sciences verticals. Also, Cloudera continues to expand its penetration across many other data‑intensive industries.

The bottom-line will be hurt by higher costs and expenses. As of October 31, 2019, the company had an accumulated deficit of $1.4 billion. The losses and accumulated deficit reflect the substantial investments it made to improvise the business. The company expects to incur further increases in the cost of revenue and operating expenses related to the integration of the Hortonworks’ platform.

Analysts expect the company to report a loss of $0.03 per share on revenue of $201.79 million for the fourth quarter. In comparison, during the previous year quarter, Cloudera posted a loss of $0.15 per share on revenue of $144.51 million. The company has surprised investors by beating analysts’ expectations in all of the past four quarters. The majority of the analysts recommended a “hold” rating with an average price target of $12.13.

For the third quarter, Cloudera reported a wider loss due to higher costs and expenses despite a 67% jump in revenue. The top line continues to be benefited by the increase in customers due to the reality of hybrid cloud data management and analytics. The company launched the Cloudera Data Platform (CDP) on Amazon Web Services and Microsoft Azure.

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For the fourth quarter, the company expects an adjusted loss in the range of $0.04-0.02 per share and total revenue in the range of $200-203 million. For fiscal 2020, the adjusted loss is predicted to be in the range of $0.21-0.19 per share and total revenue is projected to be in the range of $659-662 million.

The stock opened lower at $8.28 and is trading in the red territory on Friday with a forecast continuing to be bearish. The stock has been overvalued due to the company’s losses since the IPO. The performance outlook remained negative for the short, medium, and long-term. The share trading value is below the 50-day moving average of $10.49 and the 200-day moving average of $9.63.

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