Big data player Splunk (Nasdaq: SPLK) recently announced its first quarter results that surpassed market expectations. The company is continuing to expand its market presence through acquisitions.

Splunk’s Financials

Revenues for the first quarter grew 16% to $502 million, surpassing the market’s expectations of $492.9 million. Adjusted loss of $0.91 per share was worse than the market’s estimate of a loss of $0.72 per share.

By segment, license revenues were $143.3 million, ahead of the Street’s forecast of $123 million. Maintenance and service revenues fell 5.02% to $164.8 million. Cloud revenues grew 73% to $194 million.

Among other metrics, Annual Recurring Revenue (ARR) grew 39% over the year to $2.47 billion. Cloud revenues accounted for 56% of total software bookings for the quarter, compared with 51% a year ago.

Splunk forecast revenues of $550-$570 million for the second quarter, compared with the market’s forecast of $562.68 million. The Q2 ARR guidance of $2.59-$2.61 billion compared with the consensus of $2.61 billion. Cloud ARR target for $950-$960 million missed the market’s estimates of $985.5 million.

Splunk’s TruStar Acquisition

Recently, Splunk announced the acquisition of San Francisco based TruSTAR. Founded in 2014 by Dave Cullinane, Patrick Coughlin, and Paul Kurtz, TruSTAR operationalizes internal and external data sources through its ecosystem of partner integrations and custom API solutions. Its platform helps security teams accelerate detection, incident response, investigations, and collaboration.

The acquisition will allow Splunk to advance its ability to offer comprehensive security solutions in the cloud and expand its existing security capabilities. Customers will be able to access their data to cut through complexity and also drive effective detection, allowing them to respond to threats faster. Prior to the acquisition, TruSTAR raised $17 million in three rounds of funding from investors Storm Ventures, Acrew Capital, S28 Capital, Heavybit, Resolute Ventures, and Aspect Ventures.

Additionally, Splunk also announced the release of a new Observability Cloud, the only full-stack, analytics-powered and enterprise-grade Observability solution in the market. The Splunk Observability Cloud will allow IT and DevOps teams to get answers in a unified interface with metrics, traces and logs by leveraging data that has been collected in real-time, without sampling, and at any scale. The Observability cloud is expected to reduce its mean-time-to-resolution significantly, while allowing customers to maintain 100% uptime through higher traffic.

Its stock is currently trading at $120.54 with a market capitalization of $19.02 billion. It had climbed to a 52-week high of $225.89 in August last year. The stock has recovered from the 52-week low of $110.28 it had fallen to earlier this month.