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November 22, 2019updated 26 Nov 2019 12:15pm

Splunk License Shifts, Acquisitions Paying Off, But Company Still Burning Cash

Fresh pricing and license options have been welcomed

By CBR Staff Writer

Splunk, the San Francisco-based data intelligence platform provider, posted strong results this week on the back of a huge run of customer wins for its sales team: the company added 440 new enterprise customers during the quarter ended October 31, including Airbus, the University of Bristol, Lloyds Banking Group and Crowdstrike.

Third quarter revenues were $626 million, up 30 percent year-over-year. Cloud revenue was $80 million, up 78 percent over last year. Software revenues, which combines income from license and cloud, were $454 million, up 40 percent year-over-year.

Splunk License Revisions Paying Off

Splunk CEO Douglas Merritt talked up a recent shakeup of license and pricing terms (the company discontinued new perpetual license offerings as of November 1), saying “customer feedback so far has been extremely positive.”

The company has been working to provide more variety in how customers pay to ingest and analyse data on its platform. Beyond the broader brush ending of perpetual licenses, it has rolled out a trio of alternative payment options.

A Predictive Pricing Program (PPP) offers pricing to customers based on predefined volume tiers, up to unlimited ingestion. (Customers can consume up to the maximum in each tier for a single price). Infrastructure-based pricing meanwhile is based on the compute capacity consumed rather than data volume ingested. And so-called Rapid Adoption Packages are designed for specific IT and security use cases; these can scale up in data volume depending on the use case. 

Read this: Data is Our Greatest Asset – So Why Can’t We Find It?

The company updated its previous guidance for its fiscal year 2020 (ending January 31, 2020), saying total revenues are expected to be approximately $2.35 billion (up from $2.30 billion). Splunk continues to burn cash and posted a net loss of $57.6 million for the quarter.

It has made a series of acquisitions in recent months, including deals to buy SignalFx (for $1.05 billion in August); a month later Omnition, a SaaS company that provides microservices monitoring and then in October annoucing its intent to buy Streamlio, an open source company that does real-time stream processing.

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