Software company Splunk (NASDAQ: SPLK) on Wednesday said its revenues rose 33% in the second quarter to $517 million, driven by the strong demand for its software that helps firms analyze internal data.
The top-line was primarily lifted by a 46% improvement in software revenues during the quarter.
The San Francisco, California-based big data firm reported earnings of 30 cents per share, compared to 8 cents per share a year ago.
Wall Street was expecting a profit of 12 cents per share on revenues of $488.35 million. The better-than-expected results sent the stock up 6% immediately following the announcement.
SPLK shares have gained 19% since the beginning of this year, and 18% in the past year.
“With year-over-year revenue growth of 80% and ARR now over $300 million, the strength of our cloud business is driving a faster transition to a renewable software model,” said Jason Child, CFO, Splunk. “By the end of the year, we expect that virtually all new software sales will be cloud or term license-based.”
In the second quarter, Splunk added almost 500 new customers. The company’s client base has grown consistently over the last decade from 450 at the fiscal 2008 end to 17,500 at the end of fiscal 2019.
The data analysis provider has acquired firms like Rocana, SignalSense, Drastin, Phantom, and VictorOps over the past two years to augment its service offerings, which has helped it to compete with its peers and expand its client base.
Outlook
For the third quarter, Splunk expects revenues of about $600 million and adjusted operating margin of approximately 16%.
For the full year, the company raised its revenue expectation to $2.30 billion, from the prior projection of $2.25 billion. Guidance on non-GAAP operating margin was kept unchanged at approximately 14%.