Why nCino Stock Jumped Today

Shares of nCino (NCNO 18.95%) soared 19% on Wednesday after the cloud-based banking software company announced strong quarterly results and encouraging forward guidance.

A quarter of positivity from nCino

For its fiscal fourth quarter ended Jan. 31, 2024, nCino’s revenue grew 13% year over year to $123.7 million, translating to adjusted (non-GAAP) net income of $0.21 per share. Analysts, on average, were only modeling earnings of $0.12 per share on roughly the same revenue.

Within its top line, nCino’s subscription revenue grew 16% year over year to $107.5 million, while professional services and other revenue fell slightly to $16.2 million.

The company signed multiyear extensions and expanded agreements with 11 customers paying over $1 million in annual subscription fees during the quarter. These included two U.S. enterprise banks, five community and regional banks, and several international banks in New Zealand, Germany, and Canada.

CEO Pierre Naudé said the company was pleased by its outperformance, noting this was nCino’s strongest gross sales quarter in 2 1/2 years. “The team’s solid execution and continued focus on product innovation and experience improvements, coupled with more normal buying cycles and positive tone from customers, fuels our optimism for the year ahead and beyond,” Naudé added.

What’s next for nCino investors?

For the full fiscal year ending Jan. 31, 2025, nCino expects revenue between $538.5 million and $544.5 million — technically slightly below consensus estimates for $545.7 million — assuming subscription revenue of between $463 million and $469 million. That should translate to adjusted net income per share of $0.60 to $0.64, well above Wall Street’s expectations for full-year earnings of $0.56 per share.

In the end, the market was obviously pleased with the combination of nCino’s earnings outperformance and the more positive environment in which it’s operating today. The stock is simply responding in kind.

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