Why Alteryx Shares Are Plummeting Today

Alteryx Inc AYX shares are down Tuesday morning after it released Q2 2023 results and lowered 2023 guidance.

Also, Piper Sandler downgraded the stock to Neutral from Overweight at a decreased price target to $30 from $68.

AYX reported a Q2 2023 revenue increase of 4% Y/Y to $188 million, above the consensus of $182.2 million.

Annualized Recurring Revenue (ARR) increased 22% Y/Y to $890 million in Q2, with a dollar-based net expansion rate of 120%.

Adjusted gross profit rose to $164 million from $159 million a year ago, with margins of 87%.

The company reported an adjusted loss per share of $(0.37), better than the consensus of $(0.66).

As of June 30, 2023, cash, cash equivalents, and short-term and long-term investments of $748 million and operating cash flow of $7 million. 

Workforce Reduction: As per the planned workforce reduction during the second quarter, AYX incurred charges of $12 million related to the statutory notice period and severance payments, employee benefits, and job placement services. AYX expects the workforce reduction initiative to conclude by the end of Q3 2023.

Outlook: For Q3 2023, AYX expects revenues of $208 million - $212 million (-4% to -2% Y/Y, consensus $233.04 million) and adjusted EPS of $(0.08) to $(0.04) compared to consensus of $0.09. 

ARR is expected to be $901 million to $905 million (+19% Y/Y) in Q3 2023.

For 2023, AYX lowered the outlook for revenue to $930 million-$940 million (+9% to +10%, vs. consensus $983.92 million) from $980 million-$990 million earlier and adjusted EPS to $0.62-$0.72 (vs. consensus $0.68) from $0.65-$0.75 earlier.

For 2023, AYX also reduced ARR guidance to $930 million-$940 million (up 12% to 13%) from $1.015 billion-$1.025 billion prior.

Price Action: AYX shares are down by 24.5% at $28.40 premarket on the last check Tuesday.