Yext Inc. (NYSE: $YEXT) is a digital presence management platform based in New York that is built for multi-location brands with a large customer base. It allows businesses to efficiently manage their online presence and provide error-free information to their consumers anywhere in the world across various online platforms and directories, including information such as business hours, locations, and contact details.
On March 6, 2024, Yext announced its fourth quarter results, showcasing massive profitability and surpassing estimates.
Fourth Quarter Results
In the fourth quarter, Yext reported revenue of $101.1 million, beating estimates of $100.6 million by 0.49%. It reported a non-GAAP EPS of $0.10, surpassing analysts’ estimates of $0.07 by 47.1%.
Yext achieved $14.8 million in adjusted EBITDA, surpassing estimates of $12.6 million, partly due to a significant year-on-year increase in its gross margin, which rose from 74% to 78.6%. This growth was attributed to the Company’s transition towards a professional services strategy.
In the fourth quarter of 2024, YEXT achieved excellent profitability and improved sales ratio. The quarterly performance has surpassed Wall Street estimates and pushed the stock price higher.
However, the revenue guidance for Q1, fiscal 2025 of $96.25 million is below the analysts’ prediction of $99.32 million. Moreover, revenue for fiscal 2025 is forecast to be $401 million at the midpoint, missing estimates by 1.7%.
Additionally, the company’s sales growth has shown unsatisfactory performance over the last two years, growing only by 0.2%. Yext experienced a 0.8% decrease in revenue this quarter compared to the same period last year, which may disappoint some shareholders.
CEO and CFO Comments
CEO of YEXT, Mike Walrath, said in an earnings call, “First, we are pleased with the progress we made in fiscal year 2024 despite a very difficult operating environment. We believe our record profitability increases in sales productivity and some of the difficult decisions we made to be more focused will serve the Company well in the future and drive more efficient growth.”
Walrath added, “We will continue to focus on efficient operations, but we have seen enough to be ready to direct more investment into direct selling and sales development to drive growth in the future. Second, we made great strides last year and shifting more of our focus to the core product offerings, our customers value most and have reoriented our roadmap around our customers’ highest priorities.”
Stock Update: $YEXT
Yext (YEXT) stock surged 24.2% in premarket trading after it released its better-than-expected fourth-quarter results. It is currently trading at $6.41, with a gain of 7.43% from its previous close of $5.96. At the time of writing, the market cap is $766.683M, with a volume of 2,674,169.
The stock’s bullish momentum signals investors are positive about the company’s current performance.
Should You Buy $YEXT?
Yext had a great performance in the fourth quarter of fiscal 2024. However, the company’s sales growth has been much more impressive in the last two years. The Company is taking measures for improvements, as the CEO said. Consequently, the stock could be a great investment if management delivers on its promise.
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