Nutanix, Inc. shares fall over 10% pre-market after company guides Q1 sales with a midpoint below estimates.

Nutanix, Inc. shares fall over 10% pre-market after company guides Q1 sales with a midpoint below estimates.

Nutanix, Inc. (NASDAQ: NTNX) saw its shares drop over 10% in pre-market trading following the company's fourth-quarter earnings report and guidance for the first quarter of 2026. The stock closed at $69.60, down from $76.95 the previous day, marking a significant decline.

Nutanix reported fourth-quarter earnings per share (EPS) of $0.37, which was $0.04 better than the analyst estimate of $0.33. Revenue for the quarter came in at $653.3 million, exceeding the consensus estimate of $642.19 million. The company guided Q1 2026 revenue to be between $670.00 million and $680.00 million, which was below the analyst consensus of $678.00 million [1].

The company also provided full-year 2026 revenue guidance of $2.90 billion to $2.94 billion, which was in line with the analyst consensus of $2.91 billion. However, the cautious Q1 guidance has led to a sell-off in the stock, with shares falling by 10.25% in pre-market trading.

Nutanix's strong performance in the fourth quarter was highlighted by a 19.3% year-over-year increase in revenue and a 17% increase in annual recurring revenue (ARR) to $2.22 billion. The company's market share in the hyper-converged infrastructure (HCI) market remains robust, with a 56.6% share in 2025, outpacing competitors like VMware and Dell EMC [3].

Despite the strong financial performance, the cautious guidance for the first quarter of 2026 has raised concerns among investors. The company expects Q1 2026 revenue to be between $670.00 million and $680.00 million, which is below the $678.00 million consensus estimate. However, Nutanix's full-year 2026 revenue guidance of $2.90 billion to $2.94 billion aligns with analyst expectations and reflects confidence in the company's long-term trajectory [1].

BofA Securities, in a recent report, maintained a Buy rating on Nutanix despite lowering its price target to $93 from $95. The firm noted that Nutanix delivered fourth-quarter revenue and operating margin above guidance, with product revenues growing 28% year-over-year. The company added 800 new logos during the quarter, demonstrating continued strong customer acquisition [2].

Nutanix's stock has delivered an impressive 33.1% return over the past year, though current analysis suggests the stock is trading above its Fair Value. The company maintains an exceptional gross profit margin of 86.37% and a healthy financial position, with a "GOOD" overall financial health score according to InvestingPro's comprehensive analysis [2].

Investors should monitor Nutanix's performance closely as the company navigates the competitive enterprise cloud sector. The recent dip in share price may present an opportunity for investors who believe in the company's ability to execute on its long-term vision.

References:
[1] https://www.investing.com/news/earnings/nutanix-earnings-beat-by-004-revenue-topped-estimates-4213444
[2] https://www.investing.com/news/analyst-ratings/nutanix-stock-price-target-lowered-to-93-by-bofa-on-higher-expenses-93CH-4214328
[3] https://www.ainvest.com/news/nutanix-q4-outperformance-revenue-guidance-case-sustained-growth-enterprise-cloud-sector-2508/