Why SolarWinds Shares Are Trading Lower Today - SolarWinds (NYSE:SWI)

SolarWinds Corporation SWI reported first-quarter FY22 revenue growth of 1.7% year-on-year to $176.9 million, beating the consensus of $174.6 million.
Maintenance revenue declined 4.3% Y/Y to $115.5 million. Subscription revenue climbed 36.8% Y/Y to $38.7 million.
License revenue declined 9% to $22.6 million.
Margins: The non-GAAP gross margin contracted 140 bps to 90.3%, and the non-GAAP EBITDA margin contracted 300 bps to 38.9%.
Non-GAAP EPS of $0.24 beat the consensus of $0.22.
SolarWinds held $751.2 million in cash and equivalents.
"In the first quarter, we made significant progress on our key priorities of customer retention, increased focus on subscription revenue growth, and our accelerated evolution to platform-based solutions with the April launch of Hybrid Observability solutions," CEO Sudhakar Ramakrishna said.
Outlook: SolarWinds sees Q2 revenue of $174 million- $177 million, below the consensus of $182.6 million.
It sees a non-GAAP EPS of $0.20, below the consensus of $0.26.
SolarWinds reiterated FY22 revenue guidance of $730 million - $750 million against the consensus of $740.9 million.
SolarWinds cut the non-GAAP EPS outlook from $1.01 - $1.08 to $0.88 - $0.95 below the consensus of $1.05.
Price Action: SWI shares traded lower by 7.02% at $11.65 on the last check Thursday.

SolarWinds Shares Drop Post Dismal Guidance; Tops Q1