ServiceTitan Inc (TTAN) Stock Forecast & Price Target

ServiceTitan Inc. demonstrated a strong financial performance, highlighted by a 29.4% year-over-year increase in total revenue, primarily driven by a robust 30% growth in platform revenue, bolstered by nearly 10,000 active customers, which grew 19% compared to the prior fiscal year. The company's subscription revenue experienced notable growth of approximately 31%, outpacing usage revenue growth of around 26%, while net dollar retention remained above 110%, indicating effective customer retention and expansion strategies. Furthermore, ServiceTitan's gross margin improved to 70.2%, exceeding expectations and contributing to a gross profit of $146.9 million, reflecting the company's operational efficiencies and solid platform performance.

ServiceTitan Inc. faces a negative outlook due to expectations of subscription revenue growth falling below 20% in the near term, primarily caused by macroeconomic challenges and increased competition that hinder new customer acquisition. The company also projects a lower operating margin of 20%, falling short of the management's target of 25%, as it incurs initial costs associated with being a public company. Additionally, operating expenses exceeded estimates by $4 million, driven by higher spending in sales & marketing and research & development, further exacerbating financial pressures amid a competitive industry landscape.