Informatica Stock Plunges To Nearly 2-Year Low On Disappointing Q4 Revenue, Downbeat Guidance: Retail Sees Buying Opportunity

CEO Amit Walia said, “Although we encountered unexpected headwinds in the fourth quarter, we're entering 2025 with strong fundamentals.”

Shares of Informatica, Inc. (INFA), an artificial intelligence (AI)- powered enterprise cloud data management platform provider, slumped in premarket trading on Friday after the company's big fiscal year 2024 fourth-quarter revenue miss and subpar guidance.

The Redwood City, California-based company reported fourth-quarter adjusted earnings per share (EPS) of $0.41, up from $0.32 earned a year ago and exceeding the $0.37 consensus estimate.

Quarterly revenue fell 3.8% year over year (YoY) to $428.3 million, missing the $456.71 million consensus estimate and the $448 million to $468 million guidance. The company noted if not for a positive currency impact, the top line would have declined by 4.1%.

The company attributed the subpar revenue performance to three factors which include:

• Lower upfront self-managed subscription license revenue due to lower renewal rates
• Lower average duration of these self-managed subscription renewals further reducing up-front recognized revenue
• Strategy to shift more of customers’ implementation and support work to its professional service partners
• Forex-related revenue headwinds compared to its forecast

Informatica said its subscription revenue fell 2% YoY to $297.4 million despite cloud subscription revenue rising 33%. Subscription annual recurring revenue (ARR) climbed 17% to $1.27 billion, versus the guided range of $1.265 billion to $1.299 billion.

The company’s adjusted operating income was $162.3 million, compared to the guidance of $162 million to 182 million. The non-GAAP operating margin rose 150 basis points to 37.9%.

Informatica CEO Amit Walia said, “Although we encountered unexpected headwinds in the fourth quarter, we're entering 2025 with strong fundamentals and clear line of sight to reaching $1 billion in Cloud Subscription ARR by the end of the year."

Looking ahead, the company expects revenue of $380 million to $400 million, for the first quarter and $1.670 billion to $1.720 billion for fiscal year 2025.

Analysts, on average, expect $408.83 million and $1.74 billion, respectively.

On Stocktwits, retail sentiment toward Informatica stock remained ‘extremely bullish’ (97/100), with the message volume at an ‘extremely high’ level.

A retail watcher said the stock is way oversold.

In premarket trading, Informatica stock plunged 35.40% to $16.26, the lowest level since late May 2023. If the premarket losses carry over to the regular session, the stock is on track to experience the biggest one-day loss in three years.

The stock has lost about 3% so far this year.

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