Shares of Tableau Software fell more than 35 percent in after-hours trading Thursday after the data visualization company reported a $41 million loss for the fourth quarter. (Update 9:30 a.m. Friday: The shares continued to fall on Friday morning, down more than 45 percent).
Analysts expected earnings of $0.16 per share, but Tableau posted a loss of $0.57 per share. The Seattle-based company reported a record $203 million in revenue, which narrowly beat expectations of $200 million and was up 42 percent from last year.
“In Q4, a record 3,600 new customer accounts chose Tableau, bringing our total to more than 39,000 worldwide,” Tableau CEO Christian Chabot said in a statement. “This speaks to the immense popularity of Tableau’s products and continued strong demand from customers around the world. I remain optimistic that Tableau is best positioned to address the large and growing market opportunity for self-service visual analytics.”
In the year-ago quarter, Tableau posted net income of $20.7 million on earnings of $0.30 per share. During Q3 2015, the company reported $170.8 million in revenue, beating analyst expectations, but missed on earnings expectations with a net loss of $0.19 per share.
In an earnings call with financial analysts, Tableau CFO Tom Walker said that customer acquisition is “quite strong” with 39,000 customer accounts, but he said they saw some “softness in spend” with larger customers in the fourth quarter. “It was not at the same clip that we saw historically,” said Walker, especially as it related to the strong fourth quarter in 2014.
Chabot added that Tableau is well positioned with its data visualization tools, since it operates a “hybrid model” where customers can choose to purchase products on-site for their own data centers or purchase cloud-based offerings. While he’s bullish on the prospects going forward, Chabot added that it is “too early to say that there is some pause” that has impacted Tableau. Over the years, Chabot said that the competitive landscape has gotten “more crowded and more difficult.”
“It has gotten thicker and thicker over the years,” said Chabot, adding that the company’s “win rates” remain stable against rivals. Microsoft launched its PowerBI data analytics tool last summer, creating a new competitive threat for Tableau.
Chabot said that Tableau has the most robust data visualization product on the market, and it is competitively priced versus the competition. But he admitted that the lower-priced alternatives may have had a minor role in the softness that Tableau experienced.
“The large number of competitive alternatives that are available for customers to check out versus a few years ago probably had some role in expansion ratios,” said Chabot. “It is very hard to measure that from our perch…. I will leave you with the hypothesis that the number of things that customers are checking out has increased, probably played some role, but it doesn’t feel to us that is an overwhelming factor.”
Even so, Tableau plans to continue investing heavily in building out its marketing, sales and engineering force, taking advantage of what the company believes is an enormous opportunity.
“We have seen a lot of competitors get attracted to the overall market space, and so it is very, very important for us to recognize … what a rich opportunity it is and how much beyond (business intelligence) it is, and so we want to continue to go and be the leader there. And we think the best way to do that is through investing,” said Walker. “There will be a time when we don’t think the opportunity is as rich, and I believe that is when we would turn towards more operating leverage in the model. But right now we are actually bullish on the overall opportunity, and the long-term opportunity.” He said they are focused on growing to more than $1 billion in top-line revenue in the next few years.
Chabot told GeekWire in December that his 3,008-person company planned to grow by another 1,000 workers in 2016. It hired 1,051 net employees last year. Tableau now occupies or has inked leases at 10 buildings in the Seattle area — seven in Fremont, and three in Kirkland. The company already employs 1,200 in the region, and will add another 600 in 2016 alone.
Looking ahead, Tableau expects to bring in $160 million to $165 million in revenue for Q1 2016, and annual revenue of $830 to $850 million for 2016 as a whole — up 30 percent year-over-year.
Here’s the full press release:
SEATTLE, Feb. 4, 2016 /PRNewswire/ — Tableau Software, Inc. (NYSE: DATA) today reported results for its fourth quarter and fiscal year ended December 31, 2015.
Fourth Quarter 2015 Financial Results:
- Total revenue grew to $202.8 million, up 42% year over year.
- License revenue grew to $133.1 million, up 31% year over year.
- International revenue grew to $53.7 million, up 63% year over year.
- Added more than 3,600 new customer accounts.
- Closed 414 transactions greater than $100,000, up 36% year over year.
- Diluted GAAP net loss per share was $0.57; diluted non-GAAP net income per share was $0.33.
- Recognized a valuation allowance on deferred income tax assets of $46.7 million.
Fiscal Year 2015 Financial Results:
- Total revenue grew to $653.6 million, up 58% year over year.
- License revenue grew to $423.8 million, up 51% year over year.
- International revenue grew to $164.3 million, up 75% year over year.
- Added more than 12,500 new customer accounts.
- Closed 1,192 transactions greater than $100,000, up 53% year over year.
- Diluted GAAP net loss per share was $1.17; diluted non-GAAP net income per share was $0.62.
“In Q4, a record 3,600 new customer accounts chose Tableau, bringing our total to more than 39,000 worldwide. This speaks to the immense popularity of Tableau’s products and continued strong demand from customers around the world,” said Christian Chabot, Chief Executive Officer of Tableau. “I remain optimistic that Tableau is best positioned to address the large and growing market opportunity for self-service visual analytics.”
Financial Results for the Fourth Quarter Ended December 31, 2015
Total revenue increased 42% to $202.8 million, up from $142.9 million in the fourth quarter of 2014. License revenue increased 31% to $133.1 million, up from $101.4 million in the fourth quarter of 2014. International revenue grew to$53.7 million, up 63% from $32.8 million in the fourth quarter of 2014.
GAAP operating loss for the fourth quarter of 2015 was $7.1 million, compared to a GAAP operating income of $16.1 million for the fourth quarter of 2014. GAAP net loss for the fourth quarter of 2015 was $41.3 million, or $0.57 per diluted common share, compared to a GAAP net income of $20.7 million, or $0.27 per diluted common share, for the fourth quarter of 2014.
The fourth quarter income tax expense was $34.1 million due to the recognition of a valuation allowance. We believe that it is more likely than not that the benefit from our U.S. federal and state deferred tax assets will not be realized. In recognition of this risk, we have provided a valuation allowance of $46.7 million on the deferred tax assets relating to these jurisdictions. Excluding the impact of the valuation allowance, the income tax benefit was $12.7 million for the fourth quarter primarily as a result of the permanent extension of the federal R&D tax credit.
Non-GAAP operating income, which excludes stock-based compensation expense, was $30.1 million for the fourth quarter of 2015, compared to a non-GAAP operating income of $31.6 million for the fourth quarter of 2014. Non-GAAP net income, which excludes stock-based compensation expense and related income tax adjustments, was$26.0 million for the fourth quarter of 2015, or $0.33 per diluted common share, compared to a non-GAAP net income of $31.8 million, or $0.42 per diluted common share, for the fourth quarter of 2014.
Financial Results for the Fiscal Year Ended December 31, 2015
Total revenue increased 58% to $653.6 million, up from $412.6 million in 2014. License revenue increased 51% to$423.8 million, up from $279.9 million in 2014. International revenue grew to $164.3 million, up 75% from $93.8 million in 2014.
GAAP operating loss for 2015 was $52.0 million, compared to a GAAP operating income of $6.3 million for 2014. GAAP net loss for 2015 was $83.7 million, or $1.17 per diluted common share, compared to a GAAP net income of$5.9 million, or $0.08 per diluted common share, for 2014.
Non-GAAP operating income, which excludes stock-based compensation expense, was $67.4 million for 2015, compared to a non-GAAP operating income of $53.3 million for 2014. Non-GAAP net income, which excludes stock-based compensation expense and related income tax adjustments, was $48.1 million for 2015, or $0.62 per diluted common share, compared to a non-GAAP net income of $38.5 million, or $0.52 per diluted common share, for 2014.
Recent Business Highlights
- Released Tableau 9.2, delivering new data preparation improvements, customization for maps, enhanced security and a new native iPhone app.
- Opened a new data center in Europe to support the growing international customer base and demand for Tableau’s cloud products.
- Held its Global Partner Summit in Austin, TX; Tableau Partner awards went to Interworks, Slalom, FiveActs, Amazon Web Services, Cerner Corporation, Infosys Limited, and USEReady in recognition of excellent performance and notable achievements.
Record Customer Adoption
- 88% of Fortune 500 companies, such as Cisco, Wells Fargo and Capital One, use Tableau, which bodes well for our land and expand strategy.
- Tableau Online continues to be the Company’s fastest-growing product with more than 3,000 customer accounts.
- 2015 was a marquee year for Tableau’s international adoption. Customers in over 150 countries use Tableau. Over 17,000 customer accounts are located outside of North America.
- More than 9,000 in Europe, Middle East and Africa
- More than 6,000 in Asia Pacific
- More than 2,000 in Latin America
- Asia Pacific was the region with the fastest growth in customer acquisition, increasing over 75% year over year.
- In 2015, Tableau accelerated its rate of innovation, delivering Tableau 9.0 in April, Tableau 9.1 in September and Tableau 9.2 in December.
- Recent product updates included:
- New data preparation capabilities including an algorithm that automatically detects relevant data and cleans up spreadsheets
- Level of Detail Expressions, a feature that lets people easily express complex calculations with a few clicks
- Its first standalone mobile app, Vizable, which has been downloaded in 87 countries worldwide. The app, available for free on the iPad, allows users to explore their data using gestures such as pinching, swiping and dragging.
- A web data connector and expanded partnerships with the leading cloud databases.
- Tableau Public, Tableau’s free platform for creating and sharing public data stories, had over 80,000 new authors publish over 200,000 new visualizations, from Global CO2 Emissions, to The Cost of Attending the 2015 World Series, to a history of Monarchy in the U.K.
- To date, more than 150,000 authors have published over 470,000 visualizations. Approximately two-thirds of Tableau Public views come from outside of the U.S.
- In October, Tableau held its largest customer conference to date. It attracted more than 10,000 customers toLas Vegas for hands-on training, keynotes and sessions. The conference offered 340 sessions, and more than 100 Tableau customers shared their success stories and analytics wins. People from nearly every industry, including government, healthcare, manufacturing and retail shared their data successes.
- Tableau User Groups garnered momentum in 2015, with over 300 groups globally and over 75,000 members. Tableau held its first virtual Tableau User Group with over 3,500 live participants.
Employee and Office Growth
- Tableau hired more than 1,000 employees during 2015 and now has more than 3,000 employees worldwide.
- Since prior year, Tableau opened new offices in Washington, DC, New York City, Singapore, Vancouver,Paris, Beijing and Shanghai. Tableau now has offices in 16 cities worldwide.
Conference Call and Webcast Information
In conjunction with this announcement, Tableau will host a conference call at 1:30 p.m. PT (4:30 p.m. ET) today to discuss Tableau’s fourth quarter and fiscal year 2015 financial results. A live audio webcast and replay of the call, together with detailed financial information, will be available in the Investor Relations section of Tableau’s website athttp://investors.tableau.com. The live call can be accessed by dialing (877) 201-0168 (U.S.) or (647) 788-4901 (outside the U.S.) and referencing passcode 17889112. A replay of the call can also be accessed by dialing (855) 859-2056 (U.S.) or (404) 537-3406 (outside the U.S.), and referencing passcode: 17889112.
Tableau (NYSE: DATA) helps people see and understand data. Tableau helps anyone quickly analyze, visualize and share information. More than 39,000 customer accounts get rapid results with Tableau in the office and on-the-go. Over 150,000 people use Tableau Public to share data in their blogs and websites. See how Tableau can help you by downloading the free trial at www.tableau.com/trial.