Technology

Slack beats revenue estimates by nearly $7 million, in 49% growth

The company is facing stiffer competition in the market for remote work, which resulted in slower addition of paid customers

The Slack Technologies Inc. logo is seen on a banner outside the New York Stock Exchange (NYSE) during thew company's IPO in New York, U.S. June 20, 2019. REUTERS/Brendan McDermid
  • Slack Technologies’s second-quarter revenue topped expectations by nearly $7 million, to $215.9 million, a 49% growth year-over-year;
  • As the market for remote work expands, many players like Zoom, Google and Microsoft Teams are looking to capture a larger share of it;
  • Slack, once dubbed the “e-mail killer”, added 8,000 new customers in the second quarter, lower than the 12,000 users it added in the first. 

Slack Technologies’s second-quarter revenue topped expectations by nearly $7 million, to $215.9 million, a 49% growth year-over-year. But the results were offset by slowing quarterly billing growth and the addition of fewer paid customers to its workplace messaging platform, hurt by strong competition in the work-from-home market.

READ ALSO: A 2-year digital transformation happened within 2 months, says Microsoft director of Modern Workspace

As the market for remote work expands, many players like Zoom, Google Meet and Microsoft Teams are looking to capture a larger share of it. 

The company also said it offered credits, payment in installments and billing duration of less than a year to help users tide over the economic downturn triggered by the health crisis.

This has further pressured Slack that has flagged slowing demand from worst-affected industries like retail and travel, prompting it to withdraw its full-year billings target earlier this year.

The platform, once dubbed the “e-mail killer”, said it added 8,000 new customers in the second quarter, lower than the 12,000 users it added in the first. 

READ ALSO: Zoom continues to soar as video conferencing becomes daily routine

Slack also posted a 25% rise in second-quarter billings, falling short of the 38% growth it posted in the first quarter. Billings are an important metric for growth for a subscription-based platform like Slack.

Get the best insights about Latin America market in your inbox