Shares of Asana (NYSE:ASAN) stock are up by more than 20% following the company’s Q2 earnings and the announcement of a $350 million private placement of class A shares by CEO Dustin Moskovitz. The private placement is equivalent to 19.3 million shares and was sold based on the closing price of $18.15 on Sept. 2.
For the quarter, revenue tallied in at $134.9 million, beating the analyst estimate of $127.8 million by 5.5%. Adjusted earnings per share (EPS) came in at a loss of 34 cents while analysts forecasted a loss of 39 cents. At the end of quarter, Asana had 131,000 paying customers, while the number of customers spending $5,000 or more on an annualized basis increased to 18,040, up 41% year-over-year. Even better, full-year revenue guidance was raised to between $544 million and $547 million. That’s up from the previous internal guidance of between $536 million to $540 million.
Moskovitz’s acquisition of shares was the cherry on top of an upbeat quarter. Let’s get into the details.
CEO Dustin Moskovitz Acquires $350 Million of ASAN Stock
In regards to the private placement, Moskovitz explained: “I am investing further in Asana because I strongly believe the market opportunity is enormous and that the Work Graph is the best possible solution for helping enterprises achieve their most important goals.”
The CEO also added that he expects Asana to be free cash flow positive before the end of calendar 2024. RBC Capital Markets analyst Rishi Jaluria was skeptical of this goal and characterized it as “one that is difficult to envision without material disruption and deceleration.” The analyst believes that the private placement will ease “cash burn/solvency” problems in the near term. However, he finds the the timing of the announcement to be “somewhat curious.”
Meanwhile, Moskovitz has been on an ASAN buying spree this year. He has purchased ASAN on 23 separate occasions, with his last purchase falling on Feb. 28. As of then, he owned 19.83 million shares directly and 4.14 million shares through his trust.
In the past year, ASAN insiders have made 85 open market buys and 12 sales. In the same time period, insiders purchased 19.44 million shares while selling 869,251. That makes for a net activity of 18.57 million shares acquired. Still, investors should note that Moskovitz was responsible for a large portion of the shares purchased.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
