Proofpoint (PFPT) smashed Wall Street's first-quarter expectations late Thursday, thanks in part to a $5 million billings pull-through, and boosted 2016 guidance by $5 million at the midpoint, prompting shares to rocket Friday.
In early trading on the stock market today, Proofpoint stock jumped as much as 8% before paring the advance to a 2.5% gain in mid-morning trade, near 55. Shares are down more than 15% this year, but they have recovered 50% from a Feb. 8 bottom at 36.60 on concerns of a slowdown in IT spending.
For Q1, Proofpoint reported $79 million in sales, up 37% year over year, and a 9-cent loss per share ex items vs. a 14-cent loss in the year-earlier quarter. Billings came in at $98.3 million, up 48%.
All three metrics topped the high end of Proofpoint's guidance. The analyst consensus, meanwhile, had modeled $76.3 million in sales and a 14-cent loss per share.
During Q1, Proofpoint's protection and advanced threat segment -- which represents 71% of sales -- grew 47% year over year, CFO Paul Auvil said on the late Thursday conference call. TAP (targeted attack protection) nearly doubled and accounted for half of all new add-on business, he said.
Pacific Crest analyst Rob Owens called it a "sign o' the times (as) momentum continues," and maintained his overweight rating and 66 price target on Proofpoint stock.
"Proofpoint remains in the winners' camp relative to our bifurcation thesis, as results meaningfully outpaced expectations for the quarter," he wrote in a research report. "Q1 was demonstrative of the multiple layers of potential upside for Proofpoint."
Current-quarter guidance for $83.5 million to $84.5 million in sales and $94 million to $96 million in billings would be up a respective 32% and 26% year over year. Proofpoint sees a per-share loss of 7-8 cents vs. a 9-cent loss in the year-earlier quarter.
Billings guidance was slightly short of analyst views for $100 million, but Piper Jaffray analyst Andrew Nowinski credited that to $5 million in early renewals that typically would have been factored into Q2.
Nowinski retained his overweight rating and 76 price target on Proofpoint stock.
Proofpoint also bumped up its full-year guidance.
Partnerships with Intel (INTC) and Palo Alto Networks (PANW) haven't yet been factored into guidance but are contributing to the pipeline, Nowinski wrote.
"They did say revenue from a number of customers is double what they spent with Intel since they bought additional products like TAP or privacy," he wrote in a report. "This suggests the overall opportunity could be larger than initially estimated."
