Earnings Season Summary Q2 2023

Friends & Family Capital is pleased to launch “Seven Weeks in Seven Minutes.”
This resource is a summary of condensed and actionable insights on what you need to know from the last seven weeks of earnings announcements.
It is intended for our Founders, CFOs, and friends in the community.
See below for the overview slides from the quarter. The full presentation is available for download here.
We welcome your feedback to help shape the relevance for your business in future quarters.
Key theme for the quarter: “It Got Better Because It Got Less Worse.”
- Generative AI use cases enable new product features and price increases
- Software spend consolidation provides tailwinds to the large cloud software providers
- Signs of demand stabilization, specifically within the SMB and mid-market segments
- Efficient growth drives returns with increases in both revenue and profitability being rewarded
- 71% of companies both beat estimates and had analysts raise estimates on revenue and EPS

Our public company universe includes 45 companies. We selected these businesses as leading businesses-to-business software companies plus the technology stalwarts. The customers served by these companies are also relevant for the Founders we help as they build companies in the private markets.

Market price moved up or down by 10% or more across several companies following their earnings.

The market rewarded efficient growth. Those companies where analysts maintained or grew their sales estimates while also increasing their EBITDA and EPS estimates saw the largest price movements.

A timeless question of "Is it me? Or the market?" can be addressed through the commentary companies offer about their customers and go to market motion. We offer a few quotes below to help benchmark what you hear from account executives on your sales team.

Also of note this earnings season, four bellwether companies increased their product or service pricing as a result of new AI use cases and product features. An additional six companies also flagged the potential for upcoming product pricing discussions.

The full presentation is available for download here.