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EnerNOC's (NASDAQ: ENOC) continues to make progress on its plan to become a pure-play provider of energy intelligence software and demand response solutions. As a result, the company delivered stronger-than-anticipated second-quarter results, which led it to boost its full-year outlook. In addition to that, the company restructured its utility software business unit, which it now intends to sell in order to focus all of its attention on its growing enterprise customer base.
EnerNOC results: The raw numbers
Data source: EnerNOC. YOY = year over year.
What happened with EnerNOC this quarter?
EnerNOC's demand response business is booming:
- EnerNOC generated $116.5 million in demand response revenue during the quarter, which was 121.4% higher than the year-ago quarter and well above the top end of the company's guidance range of $105 million to $113 million.
- Software revenue, on the other hand, slipped 18.5% year over year to $16.2 million, though that was in the middle of the company's $15 million to $17 million guidance range. The company is currently holding this business for sale.
- During the quarter, the company closed the sale of its utility service business for $14 million.
- As a result of the higher-than-anticipated demand response revenue, EnerNOC eked out a small profit. Because of that, it easily bested its projected net loss of between $0.24 to $0.14 per share.
What management had to say
CEO Tim Healy,commenting on the company's results, said:
EnerNOC took meaningful steps toward its strategy to focus entirely on the enterprise marketplace. Not only did it close the sale of its utility services business, but it now plans to divest its utility software business in the coming months. The company's focus on enterprise customers is clearly paying off, as evidenced by the stronger-than-projected second-quarter results.
Those stronger results are fueling an upward revision to the company's full-year outlook for the second consecutive quarter. The company now anticipates revenue to be in the range of $370 million to $400 million, which is up from its prior range of $365 million to $395 million. Driving this revenue improvement is the anticipation for stronger demand response revenue, partially offset by weaker software revenue. Meanwhile, the company cut its loss projections from its prior range of $3.25 to $2.90 per share down to $2.95 to $2.60 per share.
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Matt DiLallo has no position in any stocks mentioned. The Motley Fool owns shares of and recommends EnerNOC. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.