Domo’s first quarter results were met with a significant positive market reaction, reflecting investor confidence in the company’s operational progress. Management attributed the quarter’s performance to the successful transition to a consumption-based pricing model, improved salesforce productivity, and strong momentum in ecosystem partnerships. CEO Josh James emphasized that recent operational changes have resulted in longer contract durations, accelerated remaining performance obligations, and increased customer retention. The leadership team also cited rapid adoption of AI-powered features and deeper customer engagement as key contributors to business stability and sales efficiency.
Is now the time to buy DOMO? Find out in our full research report (it’s free).
Domo (DOMO) Q1 CY2025 Highlights:
- Revenue: $80.11 million vs analyst estimates of $77.68 million (flat year on year, 3.1% beat)
- Adjusted EPS: -$0.09 vs analyst estimates of -$0.19 (53.6% beat)
- Adjusted Operating Income: $1.03 million vs analyst estimates of -$2.68 million (1.3% margin, significant beat)
- The company slightly lifted its revenue guidance for the full year to $316 million at the midpoint from $314 million
- Management lowered its full-year Adjusted EPS guidance to $0.22 at the midpoint, a 35.3% decrease
- Operating Margin: -17.9%, up from -26.8% in the same quarter last year
- Billings: $63.9 million at quarter end, down 2.4% year on year
- Market Capitalization: $609.6 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Domo’s Q1 Earnings Call
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Yi Fu Lee (Cantor Fitzgerald) asked about the macro environment and tariffs. CEO Josh James responded that while customers are more cautious, tariffs have not been a major issue, and the team is leveraging AI-related demand to drive activity.
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Yi Fu Lee (Cantor Fitzgerald) inquired about the 6x increase in sales productivity. James explained that the improvement was due to the new business model, ecosystem partnerships, and strong interest in Domo’s AI capabilities.
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Jared Jungjohann (TD Cowen) sought clarity on gross margin trajectory with the shift to consumption and AI. CFO Tod Crane stated that while margins should remain stable short-term, the consumption model ties revenue more closely to costs, supporting long-term margin expansion.
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Eric Martinuzzi (Lake Street) questioned pricing flexibility within consumption contracts. CRO RJ Tracy explained that value is aligned with usage, and as customers adopt more features, their consumption and spend naturally increase.
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Unidentified Analyst (Citizens JMP) asked about demand for Agent Catalyst and pipeline strength. James and CRO Tracy described strong interest in AI use cases, with customers rapidly adopting new AI-driven workflows and automation.
Catalysts in Upcoming Quarters
In future quarters, our analysts will watch (1) the pace at which partner-sourced deals contribute to overall bookings and customer acquisition, (2) the impact of AI adoption—particularly Agent Catalyst—on customer retention and usage patterns, and (3) the progression of operating margin improvements as Domo balances investment and cost controls. Execution on these priorities, as well as further retention gains, will be critical indicators of sustained profitable growth.
Domo currently trades at $15.60, up from $8.55 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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