Will SPT's Q1 2025 earnings beat forecasts?
4/7/2025 07:14pm
**Sprout Social's (SPT) Q1 2025 earnings are unlikely to beat forecasts based on the available data and analysis.** Here's why:
1. **Estimate EPS and Revenue**: The estimated EPS for Q1 2025 is -$0.22, and the estimated revenue is $107.69 million. This indicates that the company is expected to report a loss per share and a revenue that is slightly above the previous year's quarter.
2. **Recent Performance**: Sprout Social has experienced a mixed quarter in the past, with a solid beat of analysts' EBITDA estimates but EPS guidance for the next quarter missing analysts' expectations. This suggests that while the company may perform well in certain areas, it could fall short in terms of earnings per share.
3. **Market Conditions**: The company is navigating a strategic shift in its business model and faces potential privatization, which could impact its financial performance. Additionally, the acquisition of Tagger Media has led to a change in the company's customer base from monthly to annual contracts, potentially affecting the timing of revenue recognition.
4. **Analyst Expectations**: Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. This implies that analysts do not expect a significant beat or miss in earnings.
5. **Historical Performance**: Sprout Social has missed Wall Street's revenue estimates twice over the last two years. This recent trend of slightly beating or meeting expectations does not indicate a strong likelihood of a significant earnings beat in Q1 2025.
In conclusion, while Sprout Social may perform well in certain areas of their business, the combination of the estimated EPS loss, the strategic shifts, and the historical performance indicators suggest that the Q1 2025 earnings are unlikely to beat forecasts.