Apple device management company, Jamf (NASDAQ:JAMF) met Wall Street’s revenue expectations in Q4 CY2024, with sales up 8.2% year on year to $163 million. On the other hand, next quarter’s revenue guidance of $166.5 million was less impressive, coming in 0.7% below analysts’ estimates. Its non-GAAP profit of $0.17 per share was 11% above analysts’ consensus estimates.
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Jamf (JAMF) Q4 CY2024 Highlights:
- Revenue: $163 million vs analyst estimates of $162.4 million (8.2% year-on-year growth, in line)
- Adjusted EPS: $0.17 vs analyst estimates of $0.15 (11% beat)
- Adjusted Operating Income: $29.71 million vs analyst estimates of $26.01 million (18.2% margin, 14.2% beat)
- Management’s revenue guidance for the upcoming financial year 2025 is $678 million at the midpoint, missing analyst estimates by 3.5% and implying 8.1% growth (vs 12% in FY2024)
- Operating Margin: -7.5%, up from -13.5% in the same quarter last year
- Free Cash Flow Margin: 4.5%, down from 12% in the previous quarter
- Billings: $170.4 million at quarter end, up 10.4% year on year
- Market Capitalization: $1.9 billion
Company Overview
Founded in 2002 by Zach Halmstad and Chip Pearson, right around the time when Apple began to dominate the personal computing market, Jamf (NASDAQ:JAMF) provides software for companies to manage Apple devices such as Macs, iPads, and iPhones.
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The whole purpose of software is to automate tasks to increase productivity. Today, innovative new software techniques, often involving AI and machine learning, are finally allowing automation that has graduated from simple one- or two-step workflows to more complex processes integral to enterprises. The result is surging demand for modern automation software.
Sales Growth
A company’s long-term sales performance is one signal of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last three years, Jamf grew its sales at a 19.6% compounded annual growth rate. Although this growth is acceptable on an absolute basis, it fell slightly short of our standards for the software sector, which enjoys a number of secular tailwinds.
This quarter, Jamf grew its revenue by 8.2% year on year, and its $163 million of revenue was in line with Wall Street’s estimates. Company management is currently guiding for a 9.5% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 11.8% over the next 12 months, a deceleration versus the last three years. Still, this projection is above average for the sector and indicates the market is baking in some success for its newer products and services.
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Billings
Billings is a non-GAAP metric that is often called “cash revenue” because it shows how much money the company has collected from customers in a certain period. This is different from revenue, which must be recognized in pieces over the length of a contract.
Jamf’s billings came in at $170.4 million in Q4, and over the last four quarters, its growth was underwhelming as it averaged 9% year-on-year increases. This alternate topline metric grew slower than total sales, meaning the company recognizes revenue faster than it collects cash - a headwind for its liquidity that could also signal a slowdown in future revenue growth. 
Customer Acquisition Efficiency
The customer acquisition cost (CAC) payback period represents the months required to recover the cost of acquiring a new customer. Essentially, it’s the break-even point for sales and marketing investments. A shorter CAC payback period is ideal, as it implies better returns on investment and business scalability.
It’s relatively expensive for Jamf to acquire new customers as its CAC payback period checked in at 126.4 months this quarter. The company’s slow recovery of its sales and marketing expenses indicates it operates in a highly competitive market and must invest to stand out, even if the return on that investment is low.
Key Takeaways from Jamf’s Q4 Results
It was encouraging to see Jamf beat analysts’ EPS and EBITDA expectations this quarter. On the other hand, its full-year revenue guidance missed significantly and suggests a slowdown in demand. Overall, this was a weaker quarter. The stock traded down 4.3% to $14.10 immediately after reporting.
Jamf didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.