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SVMK Inc (NASDAQ:SVMK) May Be Confirming the Bottom Call

SVMK Inc (NASDAQ:SVMK) is a stock we have covered several times lately, suggesting that we may find an important bottom under construction following the end of the quiet period for sell-side firms that had an active role in underwriting the IPO, which came to the close on October 22.

In its first report as a public company, SurveyMonkey reported a slimmer than expected third quarter loss of $0.01 per share on revenue, which jumped 17.9% yr/yr to $65.21 mln, which was also ahead of expectations. The company reported a third-quarter net loss of $102.40 mln, which was driven by IPO-related stock-compensation charge. Adjusted EBITDA totaled $16.99 mln, representing yr/yr growth of 28.1%.

SVMK Inc (NASDAQ:SVMK) promulgates itself as a provider of survey software products that are used by organizations to engage with their customers and employees. The company’s product, SurveyMonkey, has been on offer since after the company’s founding in 1999.

The company’s survey platform generates an average of more than 20 mln answered questions daily across 190 countries and territories. Organizations employ SVMK’s platform to collect Net Promoter Score data from customers, measure employee engagement, and conduct market research. More than 60 mln registered users have used the survey platform since inception, and more than 16 mln users were active within the past year. The company has more than 600,000 paying users across more than 300,000 organizations. The company has paying users in 98% of the companies that make up Fortune 500.

The company notes that unlike “Big Data” platforms, which focus on the “what” of the behavior of an organization’s users or constituents, SVMK employs a People Powered Data approach that captures the “why”. The company believes the People Powered Data approach provides more valuable insight that better allows organizations to respond to constituents’ needs.

SVMK’s survey platform uses SurveyMonkey Genius, a proprietary artificial intelligence-based survey creation assistant, which allows organizations to build surveys by using insights extracted from SVMK’s database.

 

I’ma Maka Prediction Right Now

If you’re long this stock, then you’re liking how it has responded to the announcement. SVMK shares have been moving higher over the past week overall, pushing about 16% to the upside on above average trading volume.

Gross margin weakened to 64.4% from 70.6% one year ago. Research & Development expense grew 247.2% yr/yr to $51.77 mln. Looking ahead, the company expects that revenue for the fourth quarter will be between $64.8 mln and $66.8 mln, which would translate to yr/yr growth between 14% and 17%. The company’s revenue guidance range is on the high end of market expectations.

“We are off to a great start as a public company resulting from our strong execution and focus,” said SurveyMonkey CEO, Zander Lurie.

“SurveyMonkey was built on the belief that empowering individuals across organizations to engage with their key constituents is paramount to success. The importance of organizations understanding the voices and opinions of their customers and employees is more acute than ever. I’m confident in our strategy, our competitive position and the team we have to execute against our global opportunity.”

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