A Weak Revenue Forecast Causes Gitlab's Share Price To Drop By One-Third

As the provider of managing source code software provided full-year earnings estimates that fell short of expectations, GitLab shares plummeted as much as 38% in extended trade.

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Here is how the business fared:

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• Earnings: According to Trade Algo, the company lost 3 cents per adjusted share as opposed to the 14 cents per share loss that analysts had predicted.
• Trade Algo reports that revenue was $122.9 million as opposed to the analysts' prediction of $119.6 million.

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According to a release, revenue grew 58% year over year inside the quarter that ended January 31.

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GitLab forecasted an adjusted loss for the fiscal first quarter of 14 to 15 cents per share on revenue between $117 and $118 million. Trade Algo's survey of analysts predicted a revenue of $126.2 million and an adjusted profit of 16 cents per share.

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The company anticipates an estimated loss of 24 to 29 cents a share and revenue between $529 million and $533 million for the fiscal year 2024. At the center of the range, that translates to a 25% growth. The average estimate of the analysts surveyed by Trade Algo had been an adjusted profit of 54 cents for each share and revenue of $586.4 million.

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Gitlab said throughout the quarter that its specific service tier will increase to $29 per month from $19 in April. GitLab announced last month that 130 people, or around 7% of the staff, would be laid off.

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When the company's revenue growth reached 69% in 2021, its shares made their Nasdaq debut. As investors pulled their money out of tech companies that were losing money, the stock plunged 48% last year. The stock has lost close to 2% in value before the after-hours decline in 2023.

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