We caution investors to not get ahead of themselves by anticipating a return to "normal", 2019 revenue growth rates in 2021. Most Software companies have a significant Subscription revenue component. Given that Subscription bookings activity slowed for most every Enterprise Software company in 2020, this will translate to slower reported Subscription revenue growth over the … Continue reading Software Revenue Growth Will Be Muted for Many in 2021
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Apple promotors want investors to believe that Apple is a Services company. That is not reality. "Services" accounted for only 20% of revenue in AAPL's most recent fiscal year (see our table below). If Apple were to "bundle" certain hardware products into a version of its Apple One subscription (see our header photo), the company … Continue reading Apple Is A Services Company. Except It’s Not.
More Market Uncertainty Is Coming. However, Don't Paint with A Broad Brush. Align Yourself with Market Leaders. We expect Enterprise Software companies to provide conservative outlooks for the 2020 calendar year. We do not expect Enterprise Software companies to completely yank their respective 2020 outlooks as have other Technology companies. We anticipate negative investor sentiment … Continue reading Enterprise Software 2020 Outlook
Our Conversation with "Subscription Economy" Pioneer and Zuora (tkr: ZUO), Co-Founder & CEO Tien Tzuo This article serves as a follow-up to our earlier article: "Every Company Should Consider Adopting A Subscription Revenue Model" We favor subscription revenue models for a variety of reasons:Providing a better service: Subscription models (aka - "usage-based models" or "consumption-based … Continue reading The Subscription Economy
Bundle Pricing Negotiations Are Preferable to Product Pricing Negotiations Vendors have far more leverage with customers when negotiating pricing for a bundle/platform of products and services as opposed to an a la carte negotiation. There's a reason why cable providers sold content bundles for years - it was the optimal revenue and profit model - … Continue reading Have A Bundle Discussion with Customers, Not A Product DiscussionPremium
SaaS Companies and Subscription Revenue Models Every company can learn from SaaS (“Software-as-a-Service”), companies. My first exposure to SaaS companies was the first self-proclaimed "SaaS" company – Salesforce.com. This was early in my banking career around the time of Salesforce’s 2004 IPO. Today, Salesforce is a $110 Billion-plus market cap behemoth. Every company - regardless … Continue reading Every Company Should Consider Adopting A Subscription Revenue Model