Solarwinds Q3 2013 Result Analysis

Solarwinds closed the Q3 2013 with $87.5 M a 23% growth Y-O-Y. The net income was $22.8 M which is almost same as that of last year $22.4M. This is lower than the Analysts estimates.

• Their traditional IT management products new sales growth in Q3 is 5% compared to last year. 
• Their main contributor for Solarwinds' new revenue is the MSP products. The MSP products new revenue growth in Q3 2013 is 87% Y-O-Y.
• The revenue growth is mainly due to Maintenance revenue and the Subscription revenue. Growth was 42% - $53 M
• N-able's new customer count has gone up by 29% Y-O-Y.

This means, they are moving their revenue model from the one time license to subscription license. In addition, their growth is mainly due to the acquired product N-able, which is a MSP product. The revenue from the acquired products is around 9M (N-able 6 M & Confio. 3M). This means their third quarter revenue growth is around 10% only compared last year.\

• Orion new customers count growth is 9% 
• SolarWinds Storage Manager and SolarWinds Log & Event Manager new license sales were below the expected.   
• Federal Revenue was flat in 2013 compared to 2012.
• Average revenue per customer is increased from $7500-$8000.

Solarwinds is getting more bigger deals and so we have more opportunities to increase our revenue.

They increased the sales force by 14% with one new VP sales and Two new sales Directors.