Yahoo Finance JFrog Ltd (FROG) Q1 2024 Earnings: Surpasses Revenue Estimates with Strong Cloud Growth
Revenue: Reported $100.3 million, up 26% year-over-year, surpassing the estimate of $98.66 million.
Net Loss Per Share: Recorded GAAP net loss per share of ($0.08); Non-GAAP diluted earnings per share was $0.16, exceeding the estimated earnings per share of $0.14.
Cloud Revenue: Increased by 47% year-over-year to $36.9 million, indicating strong growth in cloud-based services.
Free Cash Flow: Achieved $16.6 million, demonstrating effective cash management and operational efficiency.
Customer Growth: Customers with ARR greater than $1 million increased to 40, up 90% from the previous year, highlighting significant customer expansion and retention.
Gross Margin: Non-GAAP gross margin improved to 85.1%, compared to GAAP gross margin of 79.5%, reflecting higher profitability excluding certain costs.
Operating Income: Non-GAAP operating income was $14.1 million with a margin of 14.0%, indicating strong non-GAAP profitability against a GAAP operating loss of ($16.6) million.
On May 9, 2024, JFrog Ltd (NASDAQ:FROG) released its 8-K filing, announcing the financial results for the first quarter ended March 31, 2024. The company reported a significant year-over-year revenue increase, with total revenues reaching $100.3 million, up 26% from the previous year. This performance notably exceeded the analyst estimates of $98.66 million.
Company Overview
JFrog Ltd provides a comprehensive, hybrid, universal DevOps Platform that powers and controls the software supply chain. This platform enables organizations to deliver software updates continuously and securely across any system. JFrog's product suite includes JFrog Artifactory, Pipelines, Xray, Distribution, Artifactory Edge, Mission Control, and Insight, primarily serving customers in Israel, the United States, India, and other regions.
Financial Highlights and Performance Metrics
The first quarter saw JFrog achieving a non-GAAP diluted earnings per share (EPS) of $0.16, which aligns with the estimated EPS of $0.14. The company's GAAP net loss per share was ($0.08), reflecting certain non-recurring costs and investments in growth. Notably, cloud revenues surged by 47% to $36.9 million, representing 37% of total revenue, driven by increased customer usage and adoption across various sectors.
JFrog's gross profit stood at $79.7 million with a GAAP gross margin of 79.5%. Adjusted non-GAAP gross profit was higher at $85.3 million, resulting in an 85.1% non-GAAP gross margin. The company also reported healthy cash flows, with operating cash flow at $17.5 million and free cash flow of $16.6 million. Total cash, cash equivalents, and investments were robust at $579.6 million as of March 31, 2024.
Operational and Strategic Developments
The period was marked by significant customer growth, particularly in high-value segments. The number of customers with annual recurring revenue (ARR) over $1 million increased by 90% year-over-year to 40. The enterprise+ subscription revenues also saw a substantial rise, amounting to $49 million, up 39% from the previous year. These metrics underscore JFrog's expanding footprint in the enterprise market and the increasing reliance of large organizations on its software supply chain solutions.
Additionally, JFrog announced strategic integrations with MLflow and Qwak MLOps platforms and a new partnership with Carahsoft to enhance public sector channel sales, further broadening its market reach and product applicability.
Outlook and Future Projections
For Q2 2024, JFrog anticipates revenues between $103 million and $104 million and a non-GAAP net income per diluted share ranging from $0.13 to $0.15. The full-year revenue expectations are set between $425.5 million to $429.5 million, with non-GAAP operating income projected between $56 million and $58 million.
This outlook reflects JFrog's confidence in its operational strategies and market position. The company's ongoing investments in cloud and enterprise solutions, coupled with strategic partnerships, are expected to drive continued growth and market penetration.
Conclusion
JFrog's Q1 2024 results demonstrate robust financial health and operational efficiency, highlighted by significant revenue growth, particularly in cloud services. The company's strategic initiatives and strong customer growth metrics suggest a positive trajectory, supporting its vision of a frictionless software economy. As JFrog continues to innovate and expand its platform capabilities, it remains well-positioned to meet the evolving needs of the global software development community.
Explore the complete 8-K earnings release (here) from JFrog Ltd for further details.
This article first appeared on GuruFocus.
