Why Gloo Stock Is Down Today After Some Huge Swings
Key Points
Gloo's fourth-quarter sales beat expectations, but the business posted a much bigger-than-expected loss.
The company announced that it was acquiring Enterprise MarketDesk.
Investors seemingly aren't sure what to make of the Q4 results and acquisition news.
Gloo (NASDAQ: GLOO) stock has been making wild swings in Wednesday's trading, but it's currently in the red on the daily session. The company's share price was down 2.3% as of 1 p.m. ET.
Gloo shares had been up as much as 15.9% early in today's trading but then saw a substantial bearish reversal. The company's share price had also been down as much as 4.7% in the session before regaining some ground.
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Gloo's Q4 loss came in much higher than expected
Gloo published its fourth-quarter results after the market closed yesterday and reported a big earnings miss. While the average analyst estimate had guided for a loss of $0.39 per share in the period, the company's actual loss wound up coming in at $0.77 per share. Revenue of $33.6 million topped the average analyst estimate by roughly $1.6 million.
Along with its Q4 report, Gloo announced that it had entered into a deal to purchase Enterprise MarketDesk -- a consulting and support services specialist that is partnered with Workday. While the market initially had a strong bullish reaction to the news, shares have retreated as investors have digested the details of the earnings report and acquisition.
What's next for Gloo?
Gloo says that it continues to expect sales in the current quarter to come in at $36 million and that its non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) loss will decline to $12 million. For comparison, the business recorded an adjusted EBITDA loss of $18.6 million last quarter.
Gloo also said that it now expects full-year sales for 2026 to come in at $190 million after factoring in the integration of Enterprise MarketDesk. The company expects that it will be able to double sales over the $94.7 million in revenue it recorded last year without any additional acquisitions. While the sales growth outlook for this year appears bullish, investors seem to have some reservations about the company's latest purchase and broader profit profile.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walker & Dunlop. The Motley Fool has a disclosure policy.