According to a Global Industry Research report, the Global Application Performance Management (APM) market is estimated to grow to $5 billion by the year 2020. The increasing demand is driven by the growing need of enterprises to gain better business visibility and monitor applications to deliver customer satisfaction and improve operational efficiency. An earlier Markets and Markets research had estimated the industry to grow 13% annually through the year 2019. Despite the strong market growth, New Relic (NYSE: NEWR) is not restricting its presence to the APM market and is, instead, diversifying to other software services.

New Relic’s Financials

New Relic’s fourth quarter revenues grew 57% to $52.5 million, ahead of the market’s forecast of $50.7 million. Net loss of $0.24 per share compared with the market’s forecast of $0.23 per share.

They ended the quarter with nearly 13,520 paid business accounts. The new customers added during the quarter included Creative Assembly, Immobilien Scout GmbH, Irish Continental Group, John Lewis, Kiva Microfunds, PointClickCare, PowerSchool, PT Global Digital Niaga (Blibli.com), SAVO Group, Things Remembered, Woodbine Entertainment Group, and Xero.

The company ended the year with revenues growing 64% to $181.3 million. Net loss per share reduced from $1.98 a year ago to $1.39 for fiscal year ended March 31^st 2016.

For the current quarter, the company forecast revenues of $56.2 million-$57.2 million, with a non-GAAP net loss per share of $0.23-$0.25 per share. The market was expecting revenues of $54.3 million and a loss of $0.22 per share. New Relic forecast the year’s revenue at $248 million-$253 million, and a net loss of $0.61-$0.69 per share. The Street was looking for revenues of $243 million and a $0.65 loss per share.

New Relic’s Expanding Offerings

Of late, New Relic is diversifying out of the APM market into other software offerings. It is developing a multi-product software analytics platform, for which it is seeing strong demand. Recent quarter’s metrics suggest that 30% of its new monthly recurring revenue added during quarter came from non-APM products. Two years ago, that number was under 5%.

As part of this effort, during the quarter it introduced new features across the New Relic Software Analytics Cloud that will offer the enterprise’s IT operations teams increased visibility along with the ability to diagnose and resolve performance problems quickly. The offering is already being leveraged as part of its expanded partnership with Major League Baseball (MLB). The two will now be able to integrate New Relic’s app monitoring and data analytics capabilities to improve MLB’s digital properties. It will leverage software analytics to help MLB drive successful digital transformations and strategies. Together, the two companies will jointly produce a weekly MLB Now segment called “Digging into the Data,” which will highlight new insights about individual player performance and will be available for on-demand viewing via MLB.com. They will also co-host collaborative technology-focused events, for which details are yet to be disclosed.

The company is also increasing its focus on the Government sector and has initiated proceedings for the certification process for compliance with the Federal Risk and Authorization Management Program (FedRAMP). Once completed, New Relic will get authorization by federal agencies to allow them to confidently use cloud products such as the New Relic Software Analytics Cloud.

Its stock is trading at $29.4 with a market cap of $1.47 billion. It hit a 52-week high of $40.13 in November last year.