The end of earnings season is always a good time to take a step back and look at who’s excelling (and who’s not so good). Let’s take a look at how project management software stocks fared in the third quarter, starting with Asana (NYSE:).
The future of work requires teams to collaborate across departments and remote offices. Project management software drives and benefits from this change. While the trend of collaborative work management has been strong for a while, the Covid pandemic has definitely accelerated the demand for tools that allow work to be done remotely.
The four project management software stocks we track reported a strong third quarter. As a group, revenues exceeded analyst consensus expectations by 1.9%, while revenue expectations for the next quarter were in line.
Fortunately, project management software shares have performed well, with share prices up an average of 13.3% since the last earnings results.
Best Third Quarter: Asana (NYSE:ASAN)
Founded in 2008 by Facebook co-founder Dustin Moskovitz, Asana (NYSE:ASAN) is a cloud-based project management software that allows you to plan and assign tasks to employees and track and discuss work progress.
Asana reported revenue of $183.9 million, up 10.4% year over year. This print exceeded analyst expectations by 1.8%. Overall, it was a strong quarter for the company, with a solid gain in analyst EBITDA estimates and full-year earnings per share exceeding analyst expectations.
“The launch of AI Studio is the birth of a new category, unlocking a massive Total (EPA:) Addressable Market (TAM) and growth opportunities for the company,” said Dustin Moskovitz, co-founder and CEO of Asana.
Asana delivered the slowest revenue growth and the weakest full-year guidance update of the entire group. The company added 661 business customers paying more than $5,000 annually, bringing the total to 23,609. Interestingly, the stock is up 44.1% since reporting and is currently trading at $22.28.
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Monday.com (NASDAQ:MNDY (NASDAQ:))
Founded in 2014 and named after the dreaded first day of the work week, Monday.com (NASDAQ:MNDY) is a software-as-a-service platform that helps organizations plan and track their work efficiently.
Monday.com reported revenue of $251 million, up 32.7% year over year, and exceeded analyst expectations by 1.9%. The company had a strong quarter, impressively beating analyst EBITDA estimates and significantly improving its net revenue retention rate.
Monday.com achieved the fastest revenue growth and highest full-year forecast lift among its peers. The company added 194 business customers paying more than $50,000 annually, bringing the total to 2,907. Although it has had a good quarter compared to its peers, the market seems unhappy with the results as the stock has fallen 27.6% since reporting. It is currently trading at $230.
Weakest Quarter 3: Smartsheet (NYSE:NYSE:)
Founded in 2005, Smartsheet (NYSE:SMAR) is a software-as-a-service platform that helps companies plan, manage and report work.
Smartsheet reported revenue of $286.9 million, up 16.7% year over year, beating analyst expectations by 1.1%. Still, it was a mixed quarter as analyst expectations were missed.
Smartsheet had the weakest performance compared to analyst estimates in the group. The company added 232 business customers paying more than $5,000 annually, bringing the total to 20,430. The stock is flat since the results and is currently trading at $56.
Atlassian (NASDAQ:)
Founded in 2002 by Australian co-CEOs Mike Cannon-Brookes and Scott Farquhar, Atlassian (NASDAQ:TEAM) provides software as a service that makes it easier for large teams of software developers to manage projects, especially in software development.
Atlassian reported revenue of $1.19 billion, up 21.5% year over year. This result exceeded analyst expectations by 2.8%. More broadly, it was a satisfying quarter, as it also delivered an impressive increase in analyst EBITDA estimates, but a miss in analyst billing estimates.
Atlassian achieved the highest analyst estimates among its peers. The stock is up 38.4% since reporting and is currently trading at $260.88.
Market update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs and is moving closer to the 2% target. This disinflation has occurred without serious consequences for economic growth, indicating a soft landing success. The stock market boomed in 2024, boosted by recent interest rate cuts (0.5% in September and 0.25% each in November and December), and a notable rally followed Donald Trump’s victory in the presidential election in November, pushing the indices were pushed to historic highs. Nevertheless, the outlook for 2025 remains clouded by the pace and magnitude of future interest rate cuts and by potential changes to trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
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This content was originally published on Stock Story
