Ari Kahn, CEO of Bridgeline Digital Inc. (NASDAQ:BLIN), believes 2019 will continue the growth trend established last year. While commenting on the results of the quarter ended September 2018, Kahn said the firm made great strategic decisions in 2018. As such, the CEO expects a multinational growth in the firm’s customer base. Notably, Kahn hopes this growth to centralize on the areas where the firm focused its investments.
Bridgeline registers poor revenue in Q4 FY 2018
In particular, the firm put a lot of resources into their e-commerce platform regarding increasing customer engagement. The firm, which focuses on digital services and provision of automation software, will focus on additional strategic opportunities in the New Year.
In the fourth quarter of the FY2018, the firm reported losses in the SaaS revenue. Notably, Bridgeline reported $1.1 million which implies a loss of over $300,000 compared to the same quarter of 2017. Further, the loss trend appeared in hosting revenue, recurring revenue, and subscription and perpetual license revenue. Mostly, the firm posted poor results in general during that quarter.
Nevertheless, there are some bright spots in the quarter that are substantial. Notably, Bridgeline cut operating expenses by 20.8% to $2.0 million in the quarter. As such, the firm is getting better at efficiency in its operations. According to the firm, most of the revenue loss is attributable to weak market conditions.
Share price performs dismally
Interestingly, the poor revenue growth in the fourth quarter adversely affected the company’s stock. Since mid-August, the firm’s stock took a turn for the negative, a trend which has sustained up to the close of the year. Notably, the stock breached MA (200) support in the same period and had never managed to climb above the indicator. Interestingly, the stock remains under the indicator which stands at 1.12 presently.
On the other hand, the stock was able to oscillate a few time around the 50-day moving average before disappearing below its resistance. However, the last 24-hour trading period indicates that the stock is picking up some value. Further, the current RSI reading suggests that the stock could soon break free from the two-month long bear market. Notably, there seems to be some fresh strength in the stock, however small.
Furthermore, the CCI reading for Bridgeline shows some positive energy in the stock. For most of the period after October, the CCI reading for the stock was in the extreme zone that indicates a bear market. However, the current -145.20 reading reveals an explicit impetus by investors in taking up the stock.
Source: StockCharts.com
Prospects
Besides the disappointing stock price performance and weak revenues, Bridgeline has continued to grow. Notably, the firm earned recognition as a trusted Gartner Vendor Guide. Interestingly, firms that make it to the Gartner Vendor Guides list exhibit strong growth metrics and strategy.
According to an official statement, firms listed in the trusted Gartner Vendor Guides list play an essential role in research. In particular, stakeholders in the IT and Global Marketing sectors use the firms to “research, develop and evolve their organization’s digital technology stacks and improve upon their customer experience.”
Notably, Bridgeline earned recognition due to the development of the Bridgeline Digital Experience Platform. Essentially, the platform enables companies “to drive innovation by leveraging the built-in enterprise e-commerce, web content management and marketing automation capabilities of the platform to attract, engage, and nurture prospects, as well as drive revenue through higher conversion rates.”
Given the success of the platform so far, it is possible that this year will see further growth. In particular, IT and digital needs are continually taking center stage in global business, and hence companies will need Bridgeline’s services even more.