IronNet Stock Is Tanking Today: Here's Why

IronNet Inc IRNT shares are trading sharply lower Thursday morning after the company reported worse-than-expected financial results, announced a management transition and withdrew its guidance. Multiple analysts also downgraded the stock. 

Fiscal second-quarter revenue of $6.6 million missed average analyst estimates of $7.55 million, according to Benzinga Pro. IronNet reported a quarterly net loss of 28 cents per share, which missed estimates of 21 cents per share. 

The company's total customer count grew to 78 during the second quarter, up from 51 total customers year-over-year. IronNet said it ended the quarter with $9.7 million in cash and equivalents. 

"We encountered unexpected headwinds in our transactional business this quarter. To contain costs, we are undertaking a further restructuring of the company with the support of our new CFO Cameron Pforr," said Keith Alexander, chairman, and co-CEO of IronNet.

Co-CEO William Welch will resign as co-CEO and from the company's board in light of the restructuring of the business. Welch said he would continue to support the company in the short term. CFO James Gerber will also be departing the company to join a private cybersecurity company. Gerber will be replaced by Pforr. 

Given the management transitions, IronNet said it's withdrawing its previously issued revenue and recurring revenue guidance for fiscal 2023.

"We have decided to forego a call with management this quarter, until we are better able to communicate on our progress," Alexander added.

• BTIG analyst Gray Powell downgraded IronNet from a Neutral rating to Sell.
• Jefferies analyst Joseph Gallo downgraded IronNet from a Hold rating to Underperform and lowered the price target from $2.25 to $1.

See Also: Top Financial Stories Thursday, September 15

IRNT Price Action: IronNet is making new 52-week lows on Thursday.

The stock was down 45.5% at $1.20 at time of publication.

Photo: Pete Linforth from Pixabay.