New Relic’s (NEWR) YoY revenue growth of 17.8% in 2Q22 (Sep.) benefitted from $9.7m in revenue recognized from performance obligations satisfied in prior periods; without these benefits revenue growth may have only been 12.0%, a deceleration from the prior quarter (vs. an optical +680bps acceleration). The business model transition has turned Company’s free cash flow negative on a trailing twelvemonth (TTM) basis. The Company has also seen turnover in the CEO and COO positions. For these reasons we are adding NEWR to the Biggest Concerns list.
Old Revenue Is New Again
01 February 2023