Domo (DOMO) Stock Forecast & Price Target

Domo Inc. has demonstrated strong growth metrics, evidenced by a 44.1% year-over-year increase in long-term subscription remaining performance obligation (RPO), which now stands at $189.6 million, reflecting customers' commitment to multi-year contracts. The company recorded a 19.5% year-over-year rise in subscription RPO to $409.8 million, alongside a current gross retention rate of 85%, with expectations for significant improvement by year-end. Additionally, Domo's revenue guidance for fiscal year 2026 has been adjusted upward to between $316 million and $320 million, alongside an increase in EPS guidance, indicating a positive trajectory for the company's financial health.

Domo Inc. faces a potential decline in subscription revenue, with expectations indicating a sequential drop of $0.5 million compared to a trend of positive sequential growth, which raises concerns about the company's ability to sustain its customer base. The company's dependence on a partnership with SNOW may provide short-term demand support, yet long-term competitive differentiation remains uncertain, especially as vendor consolidations could hinder Domo's growth prospects against better-positioned competitors. Moreover, the company's significant net operating loss carryforwards, while potentially advantageous for acquisitions, highlight an ongoing struggle to achieve long-term profitability and growth in the rapidly evolving business intelligence and analytics market, leading to a concerning outlook.