On Thursday, Confluent Inc (NASDAQ: NASDAQ:CFLT) saw a revision in its stock price target, which was lowered from $34.00 to $31.00 by TD Cowen, while the firm maintained a Buy rating on the shares.
The adjustment follows Confluent's recent financial performance, which included a 27% subscription revenue growth, outpacing the expected 23%.
A TD Cowen analyst attributed the growth to the strongest customer additions since the first quarter of 2022, spurred by new go-to-market strategies.
Despite the positive customer growth, Confluent's net revenue retention (NRR) of 118% did not meet its own targets. The company saw a resurgence of optimization behavior among digital-native customers in June, prompting a more cautious outlook for the second half of the year.
The conservative stance reflects the uncertainties that Confluent faces, despite the company's robust exit growth rate of over 20% in the fourth quarter.
The analyst from TD Cowen noted the impressive fourth-quarter exit growth rate and anticipates that new initiatives will contribute to the company's performance in 2025. Confluent's commitment to these new growth levers is expected to help the company sustain its momentum in the coming years.
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