Netskope, the powerful new cloud-based data security company, has made a mutually pleasing debut on the Nasdaq stock exchange. Its shares started out at $23 on the trading board as “NTSK.” With so much investor demand, the company’s first offering was oversubscribed. As a testament to its potential, the stock price exploded by a remarkable 18%, raising its market capitalization to just over $8.6 billion. Further, Netskope sold the shares at the high end of its share pricing range, netting in excess of $908 million in the process.
Netskope was built to help enterprises protect their most sensitive data. Through the application of artificial intelligence tools, they are looking to reshape the future of data network security. The company reported robust revenues of $328 million for the six months ending this July. They further bragged about their annual recurring revenue, which has recently crossed the $700 million mark. They announced some bad news with a net loss of $170 million.
Sanjay Beri, the CEO of Netskope, said his company is headed in the right direction. He added that Netskope plans to reach positive free cash flow sometime this year. This latter goal underscores the company’s new strategic direction to prioritize financial growth above all else.
“The world is moving to AI and cloud. That requires a redefinition of the biggest market in security, data network security. That’s what we are,” said Sanjay Beri.
As upbeat as the outlook may be for future profitability, Beri had no illusions about the company’s present woes. Specifically, he mentioned that Netskope does not make the large acquisitions based on just annual recurring revenue there are some of those huge multi service vendors making.
“I’m not a believer that in security and networking, people want one platform,” Beri noted. “People need to play well with each other in the industry and integrate for the best of the customer.”
Netskope’s market debut attracted huge demand, with Beri stating that the offering was over 20 times oversubscribed. This incredible level of demand is a real testament to the level of investor confidence behind the company’s mission and growth prospects.