nCino, Inc. guidance disappoints, shares tumble

nCino, Inc. (NASDAQ:) shares tumbled Thursday despite beating top and bottom-line consensus expectations in the first quarter.

The financial technology firm Q1 EPS of $0.07, $0.02 better than the analyst estimate of $0.05. Revenue for the quarter, which rose 21% YoY, came in at $113.67 million versus the consensus estimate of $112.63M.

NCNO shares are currently down over 10% at $24.55. Earlier in the session, it hit a low of $21.59 per share.

The company’s GAAP net loss in the first quarter of fiscal 2024 was $11.2M. Subscription revenues increased by 23% YoY.

Looking ahead, the company said it sees Q2 revenue between $114M and $115.5M, with subscription revenues between $97.5M and $98.5M. Adjusted earnings are seen from $0.06 to $0.08 per share.

For the full year, it sees total revenues between $474M and $478.5M, with subscription revenues between $405M and $409M. Adjusted EPS is expected to be from $0.37 to $0.40.

Reacting to the report, Needham & Company analysts maintained a Buy rating and $33 price target on the stock.

“NCNO posted solid 1QFY24 results that beat expectations on both the top and bottom lines as strong sales execution and effective cost management outweighed the impact from a softer economic backdrop,” they wrote.

“Despite the positive start to FY24, management provided a below consensus 2Q revenue guide and lowered the FY24 revenue outlook due to certain project delays and higher churn specifically among independent mortgage banks, which are being impacted by the tough macro and rising rate environment.”

Macquarie analysts said the long-term story remains strong. She maintained an Outperform rating and a $35 price target on the stock.

“Cino reported better-than-expected 1Q24 results, with total rev. of $113.7m, ahead of cons. of $112.6m,” the analysts explained. “nCino lowered its FY24 top-line midpoint from $479.5m to $476.3m, on NT slowness in large US banks and project delays in prof. services.”

“We view the guide cut as a temporary and contained state. As conditions within the US large bank sector stabilize in F2H24 and the company’s churn falls back, we see a strong rebound in FY25 and beyond given the mission-critical nature of the company’s platform and focus on improved profitability.”