Companies that move their IT operations to the cloud often find themselves confused by the pricing options they can encounter, and Apptio is cashing in on their need for help.
The Bellevue-based software-as-a-service provider recorded a 26 percent jump in third-quarter revenue to $59.2 million, it announced in an earnings press release. Wall Street analysts were expecting $58.1 million in revenue for the quarter, according to Yahoo Finance.
Most of Apptio’s revenue comes through subscriptions to products like IT Financial Management, which helps CIOs understand how much they are spending across various cloud providers and identify places in which they can cut back. Subscription revenue was $49.6 million, while revenue from services associated with those subscriptions was $9.6 million, an increase of 26 percent and 27 percent, respectively.
Apptio has been inching toward GAAP profitability over the last year but fell short in the third quarter, posting a net loss of $4.6 million. However, excluding special items, it recorded non-GAAP earnings per share of $0.05, ahead of analyst expectations of $0.03 a share.
The company raised full-year revenue guidance to a range of $233.3 million to $234.3 million. Apptio soon plans to introduce new products for smaller businesses that don’t need the full-blown enterprise tools, said Sunny Gupta, co-founder and CEO, during a conference call discussing the quarterly results with financial analysts.
Investors saw something they didn’t like in Apptio’s results, however, sending its stock down more than 11 percent in after-hours trading.
[Editor’s note: This post was updated as more information became available.]