ZUO Earnings Prediction
The chart below shows how ZUO performed 10 days before and after its earnings report, based on data from the past quarters. Typically, ZUO sees a +2.82% change in stock price 10 days leading up to the earnings, and a +2.60% change 10 days following the report. On the earnings day itself, the stock moves by -0.09%. This data can give you a slight idea of what to expect for the next quarter's release.
ZUO Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
115.40M
6.80%
5.13%
Gross Margin
67.68%
4.08%
-0.56%
Operating Margin
-6.77%
-58.97%
1371.74%
Net Margin
-6.26%
-70.02%
-49.88%
EPS
-0.05
-68.75%
-44.44%
No Data Available
ZUO Earnings Analysis
Zuora, Inc. Corporation (ZUO.N) Earnings Conference Call
Positive
Subscription Revenue Performance: In Q2, subscription revenue was $104 million, up 9% year-over-year, exceeding guidance for non-GAAP operating income at $25.6 million, representing a record 22% operating margin.
Improved Cash Generation: Adjusted free cash flow reached $12.2 million during the quarter, significantly up from $4 million generated last year, indicating improved cash generation capabilities.
Rule of 40 Achievement: The company achieved a Rule of 40 score of 31, surpassing their goal for the full fiscal year, demonstrating a strong balance of growth and profitability.
Performance Obligations Growth: Total Remaining Performance Obligations (RPO) grew 14% year-over-year to $577 million, with non-current RPO up 21% year-over-year, reflecting strong demand and multi-year renewals.
Leader in Recurring Billing: Zuora was recognized as a leader in the Magic Quadrant for Recurring Billing Applications by Gartner, highlighting its strong market position and product capabilities.
Negative
Professional Services Revenue Decline: Professional services revenue decreased by 10% year-over-year, indicating a decline in this segment as it now represents only 10% of total revenue.
Dollar-Based Retention Rate: The dollar-based retention rate (DBRR) ended at 104%, flat quarter-over-quarter and down three points year-over-year, primarily driven by churn.
Larger Deal Closure Decline: The company closed five deals with annual contract value (ACV) of $500,000 or more, down from seven in Q2 of last year, indicating a decrease in larger deal closures.
ARR Growth Decline: Annual recurring revenue (ARR) growth was only 7%, marking a multi-year low for the company, despite strong performance in the install base.
ARR Growth Adjustment: The guidance for ARR growth was adjusted down to approximately 6%, reflecting a more conservative outlook due to elongated sales cycles and deal scrutiny.
ZUO FAQs
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ZUO Earning Call Sentiment
Zuora, Inc. (ZUO) Q2 2025 Earnings Call Transcript
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ZUO.N
0%Positive
The earnings call presents a mix of positive and negative elements. Financial performance shows growth in subscription revenue and improved margins, but competitive pressures and a drop in DBRR raise concerns. While guidance for free cash flow is raised, ARR growth guidance is conservative. The Q&A session indicates cautious optimism with some challenges in new customer acquisition. Given the company's mid-sized market cap, the stock is likely to experience a neutral movement, reflecting a balance of growth potential and risks.
