Splunk surges 14% on raised fiscal '23 outlook, while License revenue drives Q3 sales

Splunk (NASDAQ:SPLK) stock rose ~14% on Thursday after FQ3 results beat estimates and the company raised its outlook for fiscal year 2023.

Non-GAAP EPS increased to $0.83, compared to -$0.37 in FQ3 a year earlier. Total revenues grew +39.87% Y/Y to $929.77M. Both figures surpassing analysts estimates.

Revenue from Cloud services increased ~54% Y/Y to $374.03M. Meanwhile, License revenue also rose ~54% Y/Y to $383.58M.

Maintenance and services revenue was largely flat, amounting to ~$172.16M.

Q3 non-GAAP operating margin was 21.3%.

Outlook:

"In addition to our strong top line results, we also made good progress on our expense reduction during the quarter. As a result, we are increasing our full-year outlook for total revenues, profitability and free cash flow," said Splunk President and CEO Gary Steele.

Fiscal Q4: The company expects total revenues to be between $1.055B and $1.085B; Consensus $1.07B.

Non-GAAP operating margin is expected to be between 23% and 26%.

Fiscal year 2023: Splunk expects total revenues to be between $3.455B and $3.485B (previously between $3.35B and $3.4B); Consensus $3.47B.

The company now anticipates non-GAAP operating margin to be in the range of 12% to 13% (previously 8%).