(Reuters) — Slack Technologies’s billing growth, a key indicator of future revenue, slowed throughout the second quarter and the workplace messaging app proprietor acknowledged it took a $11 million hit throughout the first half on account of COVID-19 related concessions.
The agency acknowledged it supplied credit score, price in installments and billing interval of decrease than a 12 months to help clients tide over the monetary downturn triggered by the properly being catastrophe, sending its shares down 18% after the bell.
Slack had throughout the earlier quarter signaled weak demand from worst-affected industries like retail and journey, prompting it to withdraw its full-year billings aim.
“In Q2, growth in many of our customers contracted or flattened versus normal seasonal trends. In August, growth began to trend at more typical seasonal levels,” Chief Financial Officer Allen Shim acknowledged in a reputation with analysts.
Slack’s quarterly billings rose 25%, but it surely absolutely fell wanting the 38% growth it posted throughout the first quarter. Billings are an important metric for growth for a subscription-based platform like Slack.
Its second-quarter revenue topped expectations by virtually $7 million, nevertheless that overachievement was not mirrored throughout the full-year outlook.
Slack’s annual revenue forecast of $870 million-$876 million was roughly in response to expectations of $872.three million.
Excluding objects, the company broke even, in distinction with analysts’ frequent estimate of an absence of three cents per share, in accordance with IBES information from Refinitiv.
(Reporting by Neha Malara in Bengaluru; Editing by Maju Samuel and Arun Koyyur)