Well I have been sitting on the sidelines waiting and watching, but this latest development really does concern me.
I agree with
@_5had0w_ that this is now a trust issue for investors. In a late February AFR interview the CEO apparently told them with "confidence" they would meet guidance. Only recently (8 March) they reaffirmed they were on track to meet their IPO forecasts and they noted
"this guidance is based on its internal procedure including an in-depth analysis by the management team and its sales channel of current orders and sales pipeline" (quote from the ASX announcement released)
Yet now - 44 days on - are we essentially being told that actually, that
"in depth analysis" was wrong? In other words, they didn't foresee any of their customers moving to SaaS, and others reducing their upsell spend? And this from a company that is supposed to be a market leader in analytics?
I guess the good(ish) news is:
1. the low end of updated guidance ($180m) is a variance of just 6.9% from the IPO guidance so it's not an earth-shattering revision. However their previous revenue miss in February was 4% (from memory) and look how much it was punished then. It just goes to show how much growth hype was priced into the SP. As others have noted above, trying to focus on EBITDA is great, but when the market valued it they were obviously looking at growth prospects over profit.
2. if they've already noted changes in purchasing behaviour by customers in April (which still has one week to run), they have clearly learned from past mistakes and are notifying the market quickly of changes to revenue guidance - good work.
Sorry for my generally negative opinion - I'm trying to find a silver lining - but I currently can't see how else this can be framed?
(Sentiment is noted as 'none' rather than 'sell' as I'd have to think this is near the bottom... but what do I know, I thought it would be a good buy when it first hit $6. I certainly didn't anticipate a further downgrade!)
(20min delay)