Asana Shares Dip Despite Strong Q4 Performance

Asana, the work management software company, experienced a decline in its stock price during late trading on Tuesday, despite posting better-than-expected financial results for the October quarter. The company’s growth rate, however, continues to be impacted by macroeconomic issues.

As of late trading, Asana shares are down 8.2%, currently priced at $21.40.

During the quarter, Asana reported a revenue of $166.5 million, reflecting an 18% increase compared to the same period last year. This figure surpassed both the company’s guidance range of $163.5 million to $164.5 million and Street consensus of $164.1 million.

Additionally, on an adjusted basis, Asana’s loss per share for the quarter was 4 cents, which is narrower than the company’s projected loss of 10 to 11 cents per share. The Street consensus had predicted a loss of 11 cents per share.

Asana’s guidance for the January quarter also exhibits strong performance. The company anticipates revenue in the range of $167 million to $168 million, surpassing the consensus forecast of $166.9 million. Furthermore, Asana expects an adjusted loss of 9 to 10 cents per share, surpassing the Street consensus prediction of a loss of 16 cents per share.

For the full fiscal year ending in January, Asana now projects revenue between $648.5 million and $649.5 million, accompanied by a loss of 26 to 27 cents per share. This exceeds the previous guidance of $642 million to $648 million in revenue and a loss of 39 to 42 cents per share.

CEO Dustin Moskovitz acknowledged that the macroeconomic headwinds persist, particularly impacting business in their renewal base. Nevertheless, he highlighted signs of stabilization in new business. Chief Operating Officer Anne Raimondi emphasized that deal cycles are longer, and budgets play a significant role.

CFO Tim Wan stated that macro issues are still affecting Asana’s net-retention rates, which measure repeat business. Asana reported a net retention rate of “over 100%” in the quarter, with customers spending over $100,000 per year showing a rate of over 120%.