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Thursday, April 18, 2024

Bandwidth stock rises nearly 50% after strong results

Communications platform company Bandwidth saw its stock price rise nearly 50% on Wednesday after it reported fourth-quarter results way above Wall Street expectations due to stronger sales with businesses, particularly health care operations.

The Raleigh-based company also projected revenue for the current quarter and 2024 that exceeded previous analyst projections.

Bandwidth traded Wednesday afternoon at $18.22, up $6.07, or nearly 50%. Earlier in the day, the stock hit a 52-week high of $18.88.

The company went public in 2017 and its shares soared above $180 in February 2021. But Bandwidth traded for less than $10 in October despite continued growth in revenue, from $343 million in 2020 to $601 million last year.

The company reported combined net losses of more than $70 million in 2020 and 2021, then reported profit of $19.6 million in 2022 and a loss of $16.3 million last year.

Bandwidth reported revenue of $165.4 million in the last three months of 2023, more than the $154.1 million that analysts had projected. Earnings of 38 cents per share, after excluding some one-time issues, also beat analyst estimates of 23 cents per share.

“We are proud to conclude 2023 with outstanding results, reflecting our commitment to innovation in cloud communications and profitable growth,” CEO David Morken said in a release. “Thanks to the disciplined execution of the team in the fourth quarter we surpassed our guidance and set new records in profitability.”

For the first three months of 2024, Bandwidth said it expects revenue of $165 million. For the year, it’s projecting revenue of $695 million to $705 million. Analysts had projected  revenue of $669.3 million.

Last year, the company opened a new west Raleigh headquarters near the PNC Arena. The the 40-acre complex comes with soccer fields, a cafeteria, a preschool and basketball courts.

The company operates as a communications services business. It offers phone number solutions, messaging, voice, 911, SIP trunking, data resale, and over-the-top voice-over-internet protocol (VoIP) services.

 

Chris Roush
Chris Roush
Chris Roush is executive editor of Business North Carolina. He can be reached at croush@businessnc.com.

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