As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at software development stocks, starting with Bandwidth (NASDAQ:BAND).
As legendary VC investor Marc Andreessen says, "Software is eating the world", and it touches virtually every industry. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming.
The 11 software development stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.3% while next quarter’s revenue guidance was in line.
Luckily, software development stocks have performed well with share prices up 13.3% on average since the latest earnings results.
Bandwidth (NASDAQ:BAND)
Started in 1999 by David Morken who was later joined by Henry Kaestner as co-founder in 2001, Bandwidth (NASDAQ:BAND) provides thousands of customers with a software platform that uses its own global network to provide phone numbers, voice, and text connectivity.
Bandwidth reported revenues of $174.2 million, up 1.9% year on year. This print exceeded analysts’ expectations by 3.1%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates.
Bandwidth delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 26.9% since reporting and currently trades at $15.59.
Is now the time to buy Bandwidth? Access our full analysis of the earnings results here, it’s free.
Best Q1: Fastly (NYSE:FSLY)
Founded in 2011, Fastly (NYSE:FSLY) provides content delivery and edge cloud computing services, enabling enterprises and developers to deliver fast, secure, and scalable digital content and experiences.
Fastly reported revenues of $144.5 million, up 8.2% year on year, outperforming analysts’ expectations by 4.8%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates.
Fastly delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.8% since reporting. It currently trades at $6.84.
Is now the time to buy Fastly? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: F5 (NASDAQ:FFIV)
Initially started as a hardware appliances company in the late 1990s, F5 (NASDAQ:FFIV) makes software that helps large enterprises ensure their web applications are always available by distributing network traffic and protecting them from cyberattacks.
F5 reported revenues of $731.1 million, up 7.3% year on year, exceeding analysts’ expectations by 1.7%. Still, it was a mixed quarter as it posted EPS guidance for next quarter missing analysts’ expectations.
Interestingly, the stock is up 9.4% since the results and currently trades at $289.85.
Read our full analysis of F5’s results here.
Akamai (NASDAQ:AKAM)
Founded in 1999 by two engineers from MIT, Akamai (NASDAQ:AKAM) provides software for organizations to efficiently deliver web content to their customers.
Akamai reported revenues of $1.02 billion, up 2.9% year on year. This number was in line with analysts’ expectations. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ EBITDA estimates and EPS guidance for next quarter topping analysts’ expectations.
Akamai had the weakest performance against analyst estimates among its peers. The stock is down 10.6% since reporting and currently trades at $76.51.
Read our full, actionable report on Akamai here, it’s free.
JFrog (NASDAQ:FROG)
Named after the founders' affinity for frogs, JFrog (NASDAQ:FROG) provides a software-as-a-service platform that makes developing and releasing software easier and faster, especially for large teams.
JFrog reported revenues of $122.4 million, up 22% year on year. This result surpassed analysts’ expectations by 4.4%. It was a strong quarter as it also recorded a solid beat of analysts’ billings estimates and an impressive beat of analysts’ EBITDA estimates.
The company added 33 enterprise customers paying more than $100,000 annually to reach a total of 1,051. The stock is up 12.8% since reporting and currently trades at $39.69.
Read our full, actionable report on JFrog here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.