Sprinklr (CXM) AI Stock Analysis

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Sprinklr

(NYSE:CXM)

72Outperform

Sprinklr's overall stock score reflects a strong financial foundation with significant revenue growth and a stable balance sheet. However, technical indicators point to potential short-term challenges, and the earnings call highlighted areas needing improvement, such as churn and cost management. The valuation is reasonable, but the lack of a dividend yield may deter some investors. Overall, Sprinklr is well-positioned in its industry but faces a transitional phase requiring strategic execution.

Positive Factors

Acquisition Potential

Sprinklr could be an attractive acquisition target for a larger vendor like Microsoft, Salesforce, SAP, Oracle, or NICE Systems.

Customer Base

Sprinklr offers a set of differentiated solutions that provide significant value as evidenced by the nearly 150 customers who pay more than $1M per year.

Profitability Improvement

Profitability was significantly better, with 12.8% operating margin above the midpoint of guidance of 9.0%.

Negative Factors

Growth Challenges

Challenges such as elevated churn, longer sales cycles, and missed renewals have contributed to growth deceleration over the past several quarters.

Workforce Reduction

The reduction in force affects approximately 15% of Sprinklr's global workforce.

Sprinklr (CXM) vs. S&P 500 (SPY)

Market Cap

$1.97B

Dividend YieldN/A

Average Volume (3M)1.72M

Price to Earnings (P/E)16.8

Beta (1Y)1.04

Revenue Growth8.74%

EPS Growth150.66%

CountryUS

Employees3,589

SectorTechnology

Sector Strength65

IndustrySoftware - Application

Share Statistics

EPS (TTM)0.10

Shares Outstanding141,717,450

10 Day Avg. Volume1,407,941

30 Day Avg. Volume1,720,923

Financial Highlights & Ratios

PEG Ratio0.08

Price to Book (P/B)3.35

Price to Sales (P/S)0.00

P/FCF Ratio35.08

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$9.88

Price Target Upside22.73% Upside

Rating ConsensusHold

Number of Analyst Covering10

Sprinklr Business Overview & Revenue Model

Company DescriptionSprinklr is a leading enterprise software company specializing in customer experience management (CXM) solutions. The company operates in the technology sector, providing a unified platform that helps businesses manage customer interactions across various digital channels, including social media, messaging, and email. Sprinklr's core services include social media management, advertising, marketing, research, and customer care, enabling organizations to enhance their customer engagement and drive business growth.

How the Company Makes MoneySprinklr makes money through a subscription-based revenue model by offering its cloud-based software platform to enterprises. Customers pay recurring fees for access to Sprinklr's suite of tools, which are designed to improve customer experience management across multiple digital touchpoints. The company generates revenue through its various product offerings, which include social engagement and listening, customer care, and marketing and advertising solutions. Additionally, Sprinklr may earn revenue from professional services such as consulting, implementation, and training to help clients maximize the value of their investment in Sprinklr's platform. Key revenue streams are driven by customer acquisition and retention, as well as upselling additional services and features to existing clients. Strategic partnerships and integrations with other technology platforms may also contribute to Sprinklr's earnings by expanding its reach and enhancing its service offerings.

Sprinklr Financial Statement Overview

Summary

Sprinklr demonstrates strong financial performance with robust revenue growth, positive net income, and a stable balance sheet. The company's financial statements highlight operational efficiency and solid cash flow generation, although there is room for improvement in cost management and liquidity.

Income Statement

Very Positive

Sprinklr's income statement reveals a strong financial trajectory with consistent revenue growth, highlighted by a significant increase from $324M in 2020 to $796M in 2025. The company has achieved a positive net income of $121M in 2025, demonstrating improved profitability. Gross Profit Margin remains healthy, showcasing operational efficiency. However, the EBIT margin indicates potential for further cost optimization.

Balance Sheet

Positive

The balance sheet shows a solid foundation with positive stockholders' equity of $612M and a manageable total debt of $48M in 2025. The Debt-to-Equity ratio is low, indicating low financial leverage, which reduces financial risk. The equity ratio suggests a balanced approach to financing. However, the decline in cash and short-term investments suggests careful liquidity management is needed.

Cash Flow

Very Positive

Sprinklr's cash flow statement indicates robust cash generation with operating cash flow at $77M and free cash flow showing consistent growth to $71M in 2025. The company has improved its free cash flow conversion, reducing reliance on external financing. However, the volatile investing and financing cash flows suggest a focus on strategic investments and capital structure adjustments.

Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
796.39M	732.36M	618.19M	492.39M	386.93M
	Gross Profit
574.32M	552.96M	454.46M	344.84M	264.85M
	EBIT
23.97M	33.95M	-51.22M	-87.47M	-28.79M
	EBITDA
42.65M	49.41M	-39.17M	-82.84M	-19.89M
	Net Income Common Stockholders
121.61M	51.40M	-55.74M	-111.47M	-41.18M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
483.46M	662.55M	578.63M	532.41M	280.69M
	Total Assets
1.18B	1.22B	1.02B	920.05M	585.89M
	Total Debt
48.70M	33.29M	16.77M	0.00	78.85M
	Net Debt
-96.56M	-130.73M	-171.62M	-321.43M	10.81M
	Total Liabilities
572.14M	543.41M	475.66M	404.20M	403.16M
	Stockholders Equity
612.06M	679.70M	549.33M	515.85M	182.73M
Cash Flow		Free Cash Flow
71.79M	51.14M	10.21M	-45.33M	827.00K
	Operating Cash Flow
77.59M	71.47M	26.66M	-32.92M	7.31M
	Investing Cash Flow
154.13M	-110.57M	-193.49M	-15.65M	-219.46M
	Financing Cash Flow
-248.16M	24.09M	34.97M	303.13M	269.78M

Sprinklr Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price8.05

Price Trends

50DMA

8.05

Positive

100DMA

8.44

Negative

200DMA

8.29

Negative

Market Momentum

MACD

-0.01

Negative

RSI

57.91

Neutral

STOCH

82.39

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CXM, the sentiment is Neutral. The current price of 8.05 is above the 20-day moving average (MA) of 7.49, above the 50-day MA of 8.05, and below the 200-day MA of 8.29, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 57.91 is Neutral, neither overbought nor oversold. The STOCH value of 82.39 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CXM.

Sprinklr Risk Analysis

Sprinklr disclosed 44 risk factors in its most recent earnings report. Sprinklr reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Sprinklr Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXM	72 Outperform	$1.97B	16.81	18.83%	―	8.74%	150.66%
RNG	69 Neutral	$2.34B	―	16.58%	―	7.78%	70.43%
SPT	66 Neutral	$1.21B	―	-36.95%	―	17.79%	16.49%
DSP	66 Neutral	$937.70M	438.53	4.15%	―	30.64%	―
ZI	64 Neutral	$3.01B	106.09	1.53%	―	-2.03%	-68.59%
JAMF	61 Neutral	$1.47B	―	-6.48%	―	10.75%	56.37%
Sector *	60 Neutral	$10.96B	10.27	-6.73%	2.97%	7.73%	-11.60%

* Technology Sector Average

Performance Comparison

CXM

Sprinklr

8.05

-4.13

-33.91%

RNG

RingCentral Inc

27.72

-8.91

-24.32%

SPT

Sprout Social

23.90

-4.25

-15.10%

ZoomInfo Technologies, Inc.

9.35

-3.61

-27.85%

JAMF

Jamf Holding

11.15

-9.26

-45.37%

DSP

Viant Technology

14.22

5.34

60.14%

Sprinklr Earnings Call Summary

Earnings Call Date:Mar 12, 2025

(Q4-2025)

% Change Since: -0.37%|

Next Earnings Date:Jun 10, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed view of Sprinklr's performance and future outlook. While the company reported growth in revenue and an increase in million-dollar customers, it also faced challenges with elevated churn, increased costs, and the need for restructuring. The company's focus on improving consistency and execution in FY '26 suggests a transitional period ahead.

Q4-2025 Updates

Positive Updates

Revenue Growth in Q4

Fourth quarter total revenue grew 4% year-over-year to $202.5 million and subscription revenue grew 3% year-over-year to $182.1 million.

Improved Non-GAAP Operating Income

Generated $25.9 million in non-GAAP operating income, resulting in a 13% non-GAAP operating margin for the quarter.

Increase in Million-Dollar Customers

At the end of FY '25, Sprinklr had 149 customers generating at least $1 million in annual subscription revenue, which grew by 18% year-over-year.

Strategic Leadership Appointments

Announced the appointment of Joy Corso as Chief Administrative Officer, and the addition of Jan Hauser and Stephen Ward to the Board of Directors.

Successful Large Customer Deals

Closed an eight-figure multi-year renewal with one of the largest technology companies in the world, reducing their service costs by millions of dollars while improving resolution speed and customer satisfaction.

Negative Updates

Professional Services Gross Margin

Professional services gross margin was break-even, which is acknowledged as not optimal and is being addressed.

Increased Data and Hosting Costs

Higher data and hosting costs are impacting subscription gross margins by approximately 400 basis points for FY '26.

Churn and Customer Renewal Pressure

The subscription revenue-based net dollar expansion rate was 104%, reflecting the full impact of elevated churn experienced during FY '25.

Workforce Reduction

Reduced the global workforce by approximately 15% as part of restructuring to better optimize and rebalance the expense base.

Challenges with Inconsistent Implementations

Experienced inconsistent implementations leading to pressure on customer renewals and satisfaction, which the company is actively addressing.

Company Guidance

During the Sprinklr Q4 Fiscal Year 2025 Earnings Call, the company provided guidance for the first fiscal quarter and full fiscal year 2026, highlighting several key financial metrics. For Q1, Sprinklr expects total revenue between $201.5 million and $202.5 million, representing 3% growth year-over-year, with subscription revenue projected at $182 million to $183 million. Non-GAAP operating income is anticipated to be between $31.5 million and $32.5 million, leading to a non-GAAP net income per diluted share of approximately $0.10. For the full fiscal year 2026, Sprinklr forecasts subscription revenue of $741 million to $743 million and total revenue of $821.5 million to $823.5 million, both reflecting 3% growth. The company aims for a non-GAAP operating income of $129 million to $131 million and a non-GAAP net income per diluted share of $0.38 to $0.39, with a 16% non-GAAP operating margin at the midpoint. Additionally, Sprinklr plans to achieve a 15% free cash flow margin, translating to approximately $120 million in free cash flow for the year.

Sprinklr Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Sprinklr Expands Board with Key Leadership Appointments

Positive

Jan 30, 2025

On January 29, 2025, Sprinklr announced the expansion of its Board of Directors with the appointments of Jan R. Hauser and Stephen M. Ward, Jr. Hauser, a prominent finance leader, will join the Audit Committee and later succeed Ed Gillis as its Chair, while Ward, a former CEO of Lenovo, will be part of the Compensation Committee. Ed Gillis will resign from his position as Chair of the Audit Committee on March 31, 2025, and from the Board on June 12, 2025, after ten years of service. These strategic appointments are expected to bolster Sprinklr’s leadership and support its growth and innovation in the AI-powered customer experience management sector.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.