Shutterfly Q1 Earnings Review: Company Delivers Better Than Expected Results

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Shutterfly reported first quarter results on April 27th, beating consensus estimates, as well as its own guidance. A loss for the quarter was recorded at 85 cents per share, which is narrower than the consensus estimate of 97 cents per share and guidance range of 92 cents to $1.01. A higher than expected top line helped reduce the losses this time around. What one needs to keep in mind is that Shutterfly’s business is highly seasonal and that the company generally incurs losses in the first three quarters of the year.

Highlights from the quarter:

  • Revenues increased 14% year over year to reach $181.7 million. This figure beat the consensus estimate of $177 million by 2.7%. This marks 61 consecutive quarters where the company has recorded net revenue year on year growth. Revenues were driven by strong performance in both the Consumer and Enterprise segments.
  • Mobile related revenue contributed its highest, with 20% of the total, primarily due to the unlimited free prints campaign.
  • The first phase of Shutterfly 3.0 was initiated this quarter as planned. The company began integrating ThisLife into Shutterfly and on completion, the ThisLife app will be pulled out of service.
  • Weaker revenues were witnessed at Wedding Divas and Tiny Prints which partially offset Shutterfly’s revenues.
  • The Enterprise segment soared this quarter with a 135% jump in revenues year over year. The company attributes this increase to better relationships with existing customers and the addition of a new Fortune 250 company to the list of clients.

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Shutterfly