What's in the Cards for Digital Turbine's (APPS) Q2 Earnings?

Zacks Equity Research
·4-min read

Digital Turbine APPS is set to release second-quarter fiscal 2021 results on Oct 29.

For the quarter, the company expects revenues between $59 million and $61 million. The Zacks Consensus Estimate for revenues is currently pegged at $60.8 million, indicating 85.3% growth from the figure reported in the year-ago quarter.

Moreover, the consensus mark for earnings stands at 11 cents per share, unchanged over the past 30 days, suggesting growth of 120% from the figure reported in the year-ago quarter.

Over the trailing four quarters, Digital Turbine’s earnings beat the Zacks Consensus Estimate twice, matched once and missed in the remaining, the average surprise being 13.2%.
 

Digital Turbine, Inc. Price and EPS Surprise

Digital Turbine, Inc. Price and EPS Surprise
Digital Turbine, Inc. Price and EPS Surprise

Digital Turbine, Inc. price-eps-surprise | Digital Turbine, Inc. Quote

Let’s see how things have shaped up prior to this announcement.

Factors to Consider

Digital Turbine is likely to have benefited from robust demand for its cloud-based mobile software offerings as enterprises continued the shift from on-premise to cloud environments, especially amid the coronavirus lockdown.

Additionally, momentum in the company’s mobile device management platform, Ignite, which gained significant traction during the fiscal first quarter, is likely to have continued in the to-be-reported quarter.

Moreover, steady contributions from products like SingleTap, Folders, App Wizard and Notifications are expected to have contributed to the top line.

An expanded partner base, which includes Samsung, America Movil, Pandora, Disney, Netflix, Twitter, Pinterest and others, is likely to have enhanced penetration in the second quarter.

At the end of the first quarter, the company announced the expansion of its device platform to power over-the-top TV streaming. It is expected to launch its software platform across all major U.S. mobile operators, including T-Mobile TMUS, AT&T T and Verizon VZ.

Digital Turbine also announced plans to launch its first device with the Ignite software on the combined T-Mobile Sprint entity. This is expected to have deepened its existing relationship with the U.S. operators and added significant value to the company’s diversified product portfolio.

Moreover, international expansion is expected to have driven the top line in the to-be-reported quarter. The company’s software was installed in more than 13 million unlocked Samsung devices across more than 75 countries as of the end of the fiscal first quarter.

Also, notable partnerships in the United States with the likes of Cricket and U.S. Cellular are expected to have helped Digital Turbine pull demand from its media partners in the United States during the soon-to-be-reported quarter.  

Content media offerings with new U.S.-based partners such as Tracfone are expected to have further strengthened Digital Turbine’s content business portfolio.

Moreover, this Zacks Rank #2 (Buy) company should expect improvement in advertiser rates due to a rebound in digital ad spending by high profile multinational advertising companies across categories, including brands, games and mobile-first applications. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Further, by acquiring Mobile Posse, Digital Turbine has effectively increased its U.S. carrier market share from around 70% to close to 100%. The acquisition is expected to have created cross-selling opportunities across platforms and deliver new ad units that help manage demand for the expanding customer base, thereby driving the top line.

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