SentinelOne Earnings Beat; Cybersecurity Firm To Stay 'Independent'

Cybersecurity company SentinelOne reported a smaller Q2 loss than anticipated, with revenue surpassing expectations.

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Sep 25, 2023 • 1 min read

SentinelOne (S) shares soared on Friday following the cybersecurity company's Q2 earnings report that exceeded expectations. The stock of SentinelOne increased by over 3%.

The company reported its earnings after the market closed on Thursday, recording an adjusted loss of 8 cents per share for the quarter ending July 31, compared to a loss of 20 cents per share the previous year. Additionally, the earnings report indicated a 46% increase in revenue to $149.4 million.

Analysts had anticipated the Mountain View, California-based company to report a revenue of $141 million and a loss of 14 cents per share.

For the upcoming quarter ending in October, SentinelOne forecasts a revenue of $156 million, compared to the estimated $154.2 million.

"Given that expectations leading up to the report were more based on M&A speculation than fundamentals, CEO Tomer Weingarten strongly dismissed a potential acquisition, emphasizing the commitment to operate 'as a public, independent and transparent company'," stated UBS analyst Roger Boyd in a client note.

On the stock market today, SentinelOne shares increased by 3.5% to close at 17.21.

The company's results were announced amidst reduced financial expectations. Moreover, its Q1 sales growth fell short of estimates and the company projected a weak outlook due to accounting issues.

Prior to the earnings report, SentinelOne shares had risen by 11% this year.

In early August, shares bounced back following reports that the well-funded, rapidly growing security startup Wiz was considering a potential bid for SentinelOne. Additionally, SentinelOne announced on Wednesday that it has terminated a marketing partnership with Wiz.

SentinelOne's software identifies malware on laptops, mobile phones, and other "endpoints" that connect to corporate networks. The company is also developing a comprehensive, threat-detection cybersecurity platform.

Its competitors include CrowdStrike Holdings (CRWD) and Microsoft (MSFT).

SentinelOne shares have a weak Composite Rating of 34 and a Relative Strength Rating of 19.

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