On the Move: ZScaler, SoundHound, Elastic, and More

Three technology companies that posted quarterly earnings will move today.

ZScaler (ZS), a cloud security firm, lost 7.6% in after-hours trade after posting revenue of $525 million, up by 35.4% Y/Y. It earned 76 a share (non-GAAP) in Q2. The firm posted strong results but ZS stock is falling because the months of rallying stretched its valuations.

ZScaler is a better investment than Palo Alto Networks (PANW).

SoundHound (SOUN), which rose from sub-$2.00 to $7.42, crashed by 21.4% last night. Markets hyped the stock on Nvidia’s (NVDA) investment position in the company. The firm lost 7 cents a share GAAP. Revenue was only $17.15 million. Insiders dumped 4.65 million shares the day before the results.

Elastic (ESTC), which ran up from $75 to $133.81, will fall by nearly 15% this morning. The firm posted non-GAAP earnings of 36 cents a share. Revenue rose by 19.4% Y/Y to $327.9 million. Notably, the software firm posted its cloud revenue growing by 29% Y/Y to $143 million. It now has over 1,270 customers with an average contract value of over $100,000.

ESTC is a good long-term investment. However, like ZScaler, the market bid the stock price to excess valuation levels.

Unlike HP Inc. (HPQ), Dell (DELL) posted incredibly strong results. DELL stock will rise ~ 20% today after the firm attributed strong AI server demand to its Q4 EPS of $2.20.

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