The problem with this company is not the top line; there is...

The problem with this company is not the top line; there is ample evidence of Revenue traction:





Instead, the problem lies with the operating margins, which are very volatile from on period to the next, making it very difficult to forecasts earnings despite the reasonably stable and rising revenue, as seen above.

And its not the GP Margin which is to blame; that varies only by 1% or 2% each period (blue columns on the chart below).   The "problem" is the Cost of Doing Business which goes up in fits and starts (CoDB-to Sales bobs up and down by several percent from one corresponding period to the next as the company builds out its infrastructure), resulting in the EBIT margin (the grey columns) being all over the shop:




It would be nice if the pace at which investment in business infrastructure rose at a nice smooth rate over time, so that the market doesn't get unpleasant surprises, like today's.

But unfortunately that's not how the world of business works often, managers need to invest ahead of the curve.

For mine, from a shareholder value creation standpoint, the most important metrics for a young business like this are Revenue growth at reasonably constant Gross Margins.  And on that score, the company is doing fine.  

Judging by today's response, it occurs to me that market - by focusing inanely on whether the result is a "beat"  or a "miss"-  is looking at the wrong thing.

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