Yext Inc. stock plummeted more than 20% toward an all-time low in after-hours trading Tuesday, after a disappointing outlook for the year and news that top executives would depart.
which makes marketing software, finished 2021 with $390.6 million in annual revenue, which beat its own guidance from last March of $375 million to $380 million. However, that guidance started the company’s shares on a downward trajectory, as analysts had been expecting Yext to produce more than $410 million heading into that report, and were projecting more than $500 million in 2021 revenue on average as late as November 2019, according to FactSet records.
Yext executives on Tuesday forecast that the company will top $400 million in revenue in 2022, but still came in well short of expectations. Sales in 2022 are expected to be $403.3 million to $407.3 million, while analysts on average were expecting $444.7 million, according to FactSet. Executives guided for an annual adjusted loss of 17 cents to 19 cents a share, while analysts on average were modeling an adjusted loss of 9 cents a share.
Executives also announced a change at the top. Founder Howard Lerman will step down as chief executive as well as from his position on the board as of March 25, and will be replaced by board chairman Michael Walrath. Chief Financial Officer Steve Cakebread will also step down, and be replaced by Chief Accounting Officer Darryl Bond.
“As CEO, Howard has built a unique platform of products unrivaled by any of our competitors. I’m excited to lead Yext’s talented team and innovative technology into its next chapter,” Walrath said. He received 2 million restricted stock units as an inducement to taking the CEO job, Yext announced in a separate news release.
Yext went public in 2017 at $11 a share, and more than doubled that price in the open market in 2018 and 2019 while touting the artificial-intelligence capabilities of its software. But shares have fallen 57.1% in the past year, closing at an all-time-low of $5.92 Tuesday before falling more than 20% in the after-hours session.
For the fourth quarter, Yext reported a loss of $23.1 million, or 18 cents a share, on sales of $100.9 million, up from $92.2 million a year ago. After adjusting for stock-based compensation, the company reported a loss of 3 cents a share, after breaking even on an adjusted basis in the fourth quarter a year before. Analysts on average expected an adjusted loss of 8 cents a share on sales of $101.3 million, according to FactSet.