Why NetSuite Shares Plunged

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of cloud-based software maker NetSuite (NYS: N) plunged today by as much as 12% after the company reported first-quarter earnings.

So what: Revenue topped expectations by coming in at a first-quarter record of $69.3 million. Adjusted net income more than doubled to $4.1 million, or $0.06 per share, also topping Street forecasts. Billings grew 26% to $77.9 million.

Now what: Recurring revenue also jumped 27% to $58 million. Full-year earnings per share are expected to be $0.19 to $0.21, which would make the consensus estimate of $0.21 on the high end of guidance. One thing that might have investors concerned is decelerating growth in billings, which had put up 36% growth last quarter.

Interested in more info on NetSuite? Add it to your watchlist byclicking here.

At the time thisarticle was published Fool contributorEvan Niuholds no position in any company mentioned.Click hereto see his holdings and a short bio.Motley Fool newsletter serviceshave recommended buying shares of NetSuite. The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.