Couchbase Gets Slight Boost as UBS Increases Price Target Despite Mixed Q1

On June 4, UBS analysts maintained a Neutral rating for Couchbase Inc. (NASDAQ:BASE) and raised their price target for the stock from $18 to $20. The update followed the company’s mixed first-quarter results.

Couchbase Inc. (NASDAQ:BASE) exceeded the previously suggested high-end forecast of $8.0 million with a new ARR of $14.2 million. Nevertheless, revenue growth was quite modest, surpassing forecasts by just $0.6 million. In comparison to the expected $0.5 million, the company’s license revenue contributed an extra $2.5 million each quarter, exceeding expectations.

The analysts saw a notable discrepancy between the annual recurring revenue (ARR) and overall revenue growth rates. ARR jumped by 21% in Q1, although revenue rose only 10%. In the second quarter, this disparity is expected to widen even more, with projections showing a 20% increase in ARR versus a 6% increase in revenue. The difference, according to Couchbase Inc. (NASDAQ:BASE), was caused by more phased migrations and a rise in Capella mix. The size of the disparity, however, alarmed UBS analysts, who speculated whether other factors might be influencing consumption revenue.

An American public software company, Couchbase Inc. (NASDAQ:BASE) develops and provides support and commercial packages for Couchbase Server and Couchbase Lite.

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