Nutanix’s stock has dropped a whopping 57 percent in less than a month and is currently down 8 percent Wednesday morning, sinking with the larger stock market amid the global coronavirus outbreak. However, Nutanix leaders are undisturbed about the company’s future.
Nutanix stock price was US$37.42 per share on 19 February, but has since fallen to US$15.94 percent as of Wednesday morning. The company’s market cap is currently US$3.17 billion.
In a recent interview with CRN USA, Nutanix CEO Dheeraj Pandey says he’s unfazed by the stock drop and is determined to grow his company into a US$3 billion software powerhouse.
“If you look back at all these other companies that went on to become larger over time, they had to go through this,” said Pandey. “Look at Microsoft’s stock from 1991 to 1994—it basically hovers around US$1.70 to US$2.95 per share in those three years. Look at Adobe’s stock from 2010 to 2014. Look at Red Hat’s stock from 2010 to 2014. You have to walk on fire to really build a large business.”
The hyperconverged pioneer’s stock initially took a 28 percent hit on 27 February following its second fiscal quarter earnings report. Nutanix reported 4 percent total revenue growth of US$347 million for its second quarter year over year with a net loss of US$217 million. Software and support sales hit US$338 million, up 14 percent year over year, while software and support billings reached US$420 million, up 12 percent from the same quarter one year ago.
However, Nutanix slightly lowered its full fiscal year 2020 software and support revenue guidance from between US$1.3 billion and US$1.4 billion to US$1.29 billion and US$1.36 billion due to coronavirus concerns, specially its impact on sales in Asia, as well as a faster than expected transition to subscription.
The coronavirus has dramatically affected the IT world – from component shortages and sales drops to the canceling of major conferences across the globe.
Nutanix stock hit an all-time low of US$15.19 per share in April 2017, but steadily grew to reach a record high of nearly US$62 per share in June 2018.
Nutanix’s CEO and co-founder said its takes endurance, perseverance and patience to become a long-term IT powerhouse.
“Where we are with our US$2 billion to go to US$3 billion, we’ll be crossing yet another chasm. I don’t bemoan this. I think it is all par for the course,” said Pandey. “Most of the world should be, by definition, a naysayer because they’re like, ‘How could you become a larger company over time?’ We just have to keep our heads down, work on things that are in our control and not worry about what we’re not in control of.”