Earnings show cloud and security software are not immune to the economic downturn

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OPINION: Once-high-flying cloud- and security-software companies are hitting turbulence as corporate customers cut back spending, writes columnist tpoletti.

Cloud-computing companies have shown that they are not recession-proof, with many reporting either disappointing earnings or a weaker outlook in the past few days as quarterly earnings season nears its conclusion.

“Just a quarter after Snowflake downplayed the impact of a tougher macro, the weakening IT spend backdrop caught up with Snowflake,” said Karl Keirstead, a UBS Securities analyst, in a note Thursday, adding that its 67% quarterly growth was very impressive in the current macroeconomic backdrop. But, “investor expectations were running high into this print and it disappointed,” Keirstead wrote.

“Starting in July of this year, the buying environment became more measured and foreign-exchange headwinds were becoming increasingly complex,” co-founder and co-CEO Marc Benioff told analysts. “We told you then we didn’t believe this challenging macro environment was going to be a short-term problem.”

The news Thursday from Zscaler Inc. ZS, +8.28% was not much better, with the cybersecurity company telling analysts that deals were taking longer than usual — about four months — to close. The company also said it did a reorganization of its salesforce, but not a full reorganization. “They’re not massive changes, but they are more than normal than we typically have done,” Zscaler CEO Jay Chaudhry told analysts.

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tpoletti Renewable_Energy_Token 44

tpoletti Renewable_Energy_Token

tpoletti So there's two narratives: Believe the media and 98% of people that have told you the world is going to crash *save your money Or Borrow as much useless fiat money and purchase commidites/ stock -risk adverse blockchain and property and hedge 5-10yrs against the dollar

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