The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how productivity software stocks fared in Q2, starting with Atlassian (NASDAQ:TEAM).
Rising employee costs and the shift to more remote work has increased the ever-present pressure to improve corporate productivity, which in turn has driven rising demand for productivity software that enables remote work, streamline project management and automate business tasks.
The 17 productivity software stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.5% while next quarter’s revenue guidance was in line.
Luckily, productivity software stocks have performed well with share prices up 14.3% on average since the latest earnings results.
Atlassian (NASDAQ:TEAM)
Started by two Australian university friends who funded their startup with credit cards, Atlassian (NASDAQ:TEAM) provides software tools that help teams plan, track, collaborate, and share knowledge across organizations.
Atlassian reported revenues of $1.38 billion, up 22.3% year on year. This print exceeded analysts’ expectations by 2.1%. Despite the top-line beat, it was still a mixed quarter for the company with a solid beat of analysts’ EBITDA estimates but a miss of analysts’ billings estimates.
“We closed out FY25 delivering over $5.2 billion of revenue, generating over $1.4 billion in free cash flow, and reaching 2.3 million AI monthly active users,” said Mike Cannon-Brookes, Atlassian’s CEO and co-Founder.
The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $169.75.
Is now the time to buy Atlassian? Access our full analysis of the earnings results here, it’s free.
Best Q2: SoundHound AI (NASDAQ:SOUN)
Born from the idea that machines should understand human speech as naturally as people do, SoundHound AI (NASDAQ:SOUN) develops voice recognition and conversational intelligence technology that enables businesses to integrate voice assistants into their products and services.
SoundHound AI reported revenues of $42.68 million, up 217% year on year, outperforming analysts’ expectations by 31.2%. The business had an incredible quarter with a solid beat of analysts’ billings estimates and an impressive beat of analysts’ EBITDA estimates.
SoundHound AI achieved the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 46.2% since reporting. It currently trades at $15.72.
Is now the time to buy SoundHound AI? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: 8x8 (NASDAQ:EGHT)
Named after its founding year (1987) with "8x8" representing binary code for communications, 8x8 (NASDAQ:EGHT) provides cloud-based contact center and unified communications solutions that enable businesses to manage customer interactions and internal communications through a single platform.
8x8 reported revenues of $181.4 million, up 1.8% year on year, exceeding analysts’ expectations by 2.2%. Still, it was a mixed quarter as it posted a significant miss of analysts’ EBITDA estimates.
8x8 delivered the weakest full-year guidance update in the group. Interestingly, the stock is up 16.3% since the results and currently trades at $2.24.
Read our full analysis of 8x8’s results here.
UiPath (NYSE:PATH)
Starting with robotic process automation (RPA) and evolving into a comprehensive automation powerhouse, UiPath (NYSE:PATH) provides an AI-powered business automation platform that enables organizations to create software robots that mimic human actions to streamline repetitive tasks and processes.
UiPath reported revenues of $361.7 million, up 14.4% year on year. This result topped analysts’ expectations by 4.1%. Taking a step back, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ billings estimates.
The stock is up 12.7% since reporting and currently trades at $12.19.
Read our full, actionable report on UiPath here, it’s free.
DocuSign (NASDAQ:DOCU)
Creating the digital equivalent of "sign on the dotted line" for over a billion users worldwide, DocuSign (NASDAQ:DOCU) provides an agreement management platform that enables businesses to electronically prepare, sign, and manage documents and contracts.
DocuSign reported revenues of $800.6 million, up 8.8% year on year. This number beat analysts’ expectations by 2.5%. Overall, it was a very strong quarter as it also produced a solid beat of analysts’ billings estimates and an impressive beat of analysts’ annual recurring revenue estimates.
The stock is up 11.8% since reporting and currently trades at $85.28.
Read our full, actionable report on DocuSign here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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