The recent earnings report from Thoughtworks Holding (TWKS 19.84%) pleasantly surprised investors with better-than-expected quarterly revenue guidance. This boosted the company’s share price by nearly 20% on Tuesday, outperforming the marginal gain of the S&P 500 index.
Despite a 19% year-over-year decline in revenue to just under $249 million, Thoughtworks exceeded analysts’ estimates of slightly over $243 million. The company reported a non-GAAP net loss of $7.4 million, or $0.02 per share, compared to a profit of $10.1 million in the same period last year, aligning with consensus forecasts.
However, Thoughtworks remained optimistic about its future, citing strong bookings during the quarter and the addition of 49 new clients. The company highlighted increasing interest in its artificial intelligence (AI) services, reflecting growing demand in the tech sector.
Investor enthusiasm was further fueled by Thoughtworks’ positive guidance for both the current second quarter and full-year 2024. Revenue for Q2 is projected to range between $250 million and $255 million, with adjusted earnings per share ranging from a loss of $0.01 to breakeven. For full-year 2024, revenue is expected to be between $995 million and $1.02 billion, with earnings per share forecasted at $0.02 to $0.08.
While Thoughtworks’ stock performance impressed, investors should carefully weigh their options before investing. The Motley Fool Stock Advisor team recently identified 10 top stocks with significant growth potential, none of which included Thoughtworks. This underscores the importance of thorough research and analysis before making investment decisions.
