Domo Stock: Debt Concerns Overshadow Q4 Earnings Beat

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TLDR

  • Domo’s Q4 earnings per share (EPS) came in at $0.03, surpassing the consensus estimate of -$0.03 by $0.06
  • Revenue totaled $79.63 million, exceeding the $78.65 million estimate
  • The stock trades at $4.38, down 74% over the past six months and near its 12-month low of $3.45
  • Citizens reaffirmed a Market Underperform rating with a $3.50 price target, citing concerns over debt and competition
  • Domo holds approximately $126 million in debt at a 12.2% interest rate, with just $43 million in cash on hand

Domo delivered an unexpected profit in fiscal 2026’s fourth quarter, defying analyst projections. The cloud business intelligence firm recorded $0.03 per share, contrasted with the consensus forecast of a $0.03 loss — a $0.06 upside.

Quarterly revenue reached $79.63 million, surpassing the $78.65 million estimate. It was a clear beat on both metrics.

The stock gained $0.11 during the day to close at $4.38, with volume around 1.75 million — higher than its average of 1.27 million. However, a longer-term view shows a bleaker picture.

Domo, Inc., DOMO
DOMO Stock Card

Domo is down about 74% over the past six months. Its 12-month high stands at $18.49. It’s currently trading well below both its 50-day moving average of $5.68 and its 200-day moving average of $10.47.

Despite the earnings beat, Citizens maintained its Market Underperform rating and $3.50 price target on the stock — a level below its current trading price.

Debt Load Is the Core Concern

Citizens highlighted Domo’s debt as a key risk. The company has a credit facility of approximately $126 million with a 12.2% interest rate, maturing in August 2028. In comparison, Domo has only $43 million in cash on hand.

This gives Domo a current ratio of 0.57 — meaning short-term liabilities outpace liquid assets. It’s a precarious position.

The debt also includes covenants. Domo must achieve minimum annual recurring revenue of $285 million by the end of fiscal Q4 2026, rising to $290 million by the end of fiscal Q1 2027. It also needs to maintain adjusted EBITDA of at least $12.1 million and $15.2 million at those same checkpoints.

A liquidity covenant requires Domo to keep at least $25 million in unrestricted cash in U.S.-based pledged accounts.

Competition Isn’t Getting Easier

Citizens also noted the competitive landscape. Domo operates within the Snowflake ecosystem, where it encounters competition from vendors such as Sigma Computing.

Sigma revealed at last week’s Citizens Technology Conference that it hit $200 million in annual recurring revenue — roughly doubling year-over-year. That type of growth makes competitive pressures hard to overlook.

Analyst sentiment on Domo is, at best, mixed. TD Cowen reduced its price target from $16 to $9 but maintained a Buy rating. Citigroup lowered Domo from Outperform to Underperform in February. Lake Street and Wall Street Zen both shifted to Hold ratings.

Cantor Fitzgerald is the exception, keeping an Overweight rating with a $22 price target.

The consensus rating is “Hold” with a price target of $12.07 — nearly three times the current stock price.

Regarding ownership, institutional investors hold 76.64% of the stock. Goldman Sachs boosted its position by 22.5% in the previous quarter. AQR Capital Management expanded its holdings by 17.5%.

The stock has a market cap of $183 million, a P/E ratio of -2.56, and a beta of 1.70. Its 12-month low is $3.45.