Bank software company nCino (NASDAQ:NCNO) met Wall Street’s revenue expectations in Q4 CY2024, with sales up 14.3% year on year to $141.4 million. On the other hand, next quarter’s revenue guidance of $139.8 million was less impressive, coming in 4% below analysts’ estimates. Its non-GAAP profit of $0.12 per share was 35.1% below analysts’ consensus estimates.
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Revenue: $141.4 million vs analyst estimates of $140.9 million (14.3% year-on-year growth, in line)
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Adjusted EPS: $0.12 vs analyst expectations of $0.19 (35.1% miss)
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Adjusted Operating Income: $24.38 million vs analyst estimates of $24.01 million (17.2% margin, 1.5% beat)
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Management’s revenue guidance for the upcoming financial year 2026 is $576.5 million at the midpoint, missing analyst estimates by 6% and implying 6.6% growth (vs 13.4% in FY2025)
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Adjusted EPS guidance for the upcoming financial year 2026 is $0.68 at the midpoint, missing analyst estimates by 23.4%
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Operating Margin: -4.1%, down from -2.6% in the same quarter last year
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Free Cash Flow was -$10.37 million, down from $5.10 million in the previous quarter
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Market Capitalization: $3.18 billion
“We ended the year strong, with meaningful year-over-year subscription revenues and ACV growth, while continuing to realize efficiencies across our operations,” said Sean Desmond, Chief Executive Officer at nCino.
Founded in 2011 in North Carolina, nCino (NASDAQ:NCNO) makes cloud-based operating systems for banks and provides that software-as-a-service.
Consumers these days are accustomed to frictionless digital experiences from online shopping to ordering food or hailing a cab. Financial services firms are notoriously risk averse in adopting modern software, often lacking the resources or competency to develop the digital solutions in-house. That drives demand for software as a service platforms that allows banks and other finance institutions to offer the digital services without having to run or maintain them.
A company’s long-term performance is an indicator of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Thankfully, nCino’s 25.4% annualized revenue growth over the last three years was solid. Its growth beat the average software company and shows its offerings resonate with customers.
This quarter, nCino’s year-on-year revenue growth was 14.3%, and its $141.4 million of revenue was in line with Wall Street’s estimates. Company management is currently guiding for a 9.1% year-on-year increase in sales next quarter.
