Cognyte Shares Fall On Disappointing Q2 Revenue Performance

Cognyte Software Ltd CGNT reported a second-quarter FY23 non-GAAP revenue decline of 30.1% year-on-year to $81.3 million, missing the consensus of $92.5 million.
Segments: Software revenue declined by 43.7% Y/Y to $27.02 million.
Software service revenue fell 15.7% Y/Y to $45.44 million.
Professional service and other revenue decreased 38% Y/Y to $8.65 million.
The non-GAAP gross margin contracted 840 bps to 65.1%.
The company's operating loss was $(26.4) million.
Non-GAAP EPS loss of $(0.04) beat the consensus loss of $(0.17).
Cognyte held $54.7 million in cash and equivalents.
"Security threats are pervasive, and customers need innovative security solutions to address evolving threats. However, the global economic slowdown is affecting our near-term performance. In the second quarter, our revenue was disappointing, but we are encouraged with bookings coming in higher than revenue and contributing to a substantial increase in backlog," CEO Elad Sharon said.
Price Action: CGNT shares traded lower by 11.36% at $3.90 in the premarket session on the last check Wednesday.

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