Anaplan, Heading into Earnings 2/25

Updated: Apr 27, 2021

Anaplan is another large position and high conviction name for me, after a review of their most recent 10-K, understanding the business, reading the last 3 earnings calls, I started to grow confidence in what they do and their execution. Connect planning is something that will replace legacy softwares as the whole business needs to connected and in real-time too with predictive analytics. Below are some key highlights from last report that should be noted. I have been utilizing for my transcript reading and data aggregation recently.

Q3 2021:

Businesses continue to prioritize investments toward initiatives that drive business value. 417 customers with ARR over $250k, 60% of bookings in Q3 came from existing customers (in-line with historical average). RPO, or remaining performance obligations, was $740m up 25% YoY, billings grew 27% YoY and subscription revenue grew 31% YoY. Newest innovation called PlanIQ with Amazon Forecast leveraging machine learning technologies, Fiducia would like to have an update on how this is going. Forecasting is imperative and a "must" in planning, especially real-time connected planning. New partnership with Google Cloud to extend the reach of Anaplan's platform, updates on this are warranted as well.

Quick Financial High + Q4 Guidance:

  • Total Revenue Q3 was $115m, up 28% YoY

  • Subscription Revenue grew 31%, comprised 91% of total revenue

  • Services Revenue were $10m, flat YoY

  • Billings Growth was $145m, up 27% YoY (sequential improvement last Q of 22%)

  • RPO in 3Q was $740m, up 25% YoY. Current RPO to be recognized over next 12mo is $383, up 28% YoY

  • NRR is 113%, remained focused on driving higher volume and expand deals

  • Over 1,500 customers

Estimates for Q4.

  • Revenue of 119.18 (21.3 YoY estimates), Fiducia would like to see 25-28%)

  • Earnings of -.10

Historical beats on revenue over the years down below, data from Seeking Alpha.

Honestly, I think connected planning is bigger than we think and this company could turn into the next Salesforce type compounder. Not apples to apples, but you get my point in terms of potential market breadth. Operating margins in Q3 were -5%, improvement of 5 percentage points YoY. These businesses are focused on improving operating leverage and becoming profitable, I will be a shareholder.

Today, Anaplan received an upgrade from Morgan Stanley analyst Stan Zlotsky. I give him brownie points for upgrading before earnings, especially with $100 price target. Going out on a limb and differentiating himself from the other analysts. He cited execution improvement, demand trends, and product differentiation and noting how they can return to durable growth above 30%. Now, we dont want to have confirmation bias BUT that was Fiducia thesis earlier when we first initiated the position. Here and here .

Will be covering this one come 2/25! Enjoy!

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