Cloud Stocks: Confluent Targets Growth Through Partner Network
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The global application infrastructure middleware market is expected to grow at 10% CAGR from $47.5 billion in 2021 to reach $83.1 billion by 2027. Confluent (CFLT) is a leading data streaming platform provider in the industry. It recently reports its quarterly results that surpassed market expectations.
Confluent’s Financials
Revenues for the second quarter grew 58% to $139.4 million. Non-GAAP loss was $0.16 per share. The market was looking for revenues of $131.21 million and a loss of $0.41 per share.
By segment, Confluent’s Subscription revenues grew 62% to $127 million, and Service revenues grew 26.5% to $12.4 million.
Among key metrics, customers with ARR of more than $100,000 grew 39% to 857 at the end of the quarter. Confluent Cloud revenue grew 139% to $47 million.
For the third quarter, Confluent expects revenues between $143-$145 million, and a loss per share between $0.19-$0.17. For the fiscal year, it expects revenues of $567-$571 million, up from $554-$560 million expected a quarter ago. It expects to end the year with a loss per share between $0.73-$0.69 compared with earlier estimated loss of $0.79-$0.73 per share.
Confluent’s Product Expansion
Recently, Confluent announced the launch of Stream Designer, a visual interface that enables developers to build and deploy streaming data pipelines in minutes. This easy-to-use visual builder will help democratize data streams so they are accessible to developers beyond specialized Apache Kafka experts. As more teams build and iterate on streaming pipelines, organizations need to quickly connect more data throughout their business for agile development and better, faster decision-making. Confluent realizes that data streaming is helping making real-time business decisions. Traditional batch processing is giving way to data streaming, and Stream Designer is targeted to address that requirement.
It also announced a new tier of capabilities for Stream Governance that will allow organizations to resolve issues within complex pipelines, and enforce quality controls globally with Schema Registry. With more teams being able to access data streams, organizations can build critical applications faster. The service will provide organizations with point-in-time playbacks for stream lineage to allow for troubleshooting, and business metadata for stream catalog to improve data discovery and simplify the process of exploring the catalog with GraphQL API.
Confluent recognizes the importance of a partner ecosystem to drive growth. Earlier this quarter, it announced the launch of a Confluent cloud reseller program that will help organizations accelerate their adoption of data in motion by purchasing Confluent Cloud directly from the consulting partners they already work with, and who can offer localized support. It expanded its strategic agreement with AWS by joining the marketplace channel program. Confluent can now work with 17 leading data streaming partners to make it easier for customers to unlock the value of data streaming. This quarter, it was also recognized by both Microsoft and MongoDB as one of their top partners for 2022.
Confluent’s stock is currently trading at $26.48 with a market capitalization of $7.46 billion. It hit a 52-week high of $94.97 in November last year and a 52-week low of $16.48 in May. The company had listed last June when it raised $828 million at a valuation of $9.1 billion.
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Disclosure: All investors should make their own assessments based on their own research, informed interpretations, and risk appetite. This article expresses my own opinions based on my own research ...
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