The Gory Details of MicroStrategy's Earnings Miss

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MicroStrategy (NAS: MSTR) reported earnings on Jan. 29. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), MicroStrategy beat expectations on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue grew slightly and GAAP earnings per share shrank.


Gross margins dropped, operating margins grew, net margins shrank.

Revenue details
MicroStrategy reported revenue of $164.5 million. The nine analysts polled by S&P Capital IQ expected revenue of $160.1 million on the same basis. GAAP reported sales were 2.6% higher than the prior-year quarter's $160.3 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.73. The eight earnings estimates compiled by S&P Capital IQ averaged $0.99 per share. GAAP EPS of $0.73 for Q4 were 9.9% lower than the prior-year quarter's $0.81 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 75.9%, 60 basis points worse than the prior-year quarter. Operating margin was 8.2%, 260 basis points better than the prior-year quarter. Net margin was 5.0%, 60 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $150.4 million. On the bottom line, the average EPS estimate is $0.44.

Next year's average estimate for revenue is $645.9 million. The average EPS estimate is $3.29.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 187 members out of 220 rating the stock outperform, and 33 members rating it underperform. Among 70 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 57 give MicroStrategy a green thumbs-up, and 13 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on MicroStrategy is hold, with an average price target of $110.71.

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The article The Gory Details of MicroStrategy's Earnings Miss originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. TMFDisclosureHere

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