Nutanix (NTNX) Stock Forecast & Price Target

Nutanix reported revenue of $654.7 million, representing a 16% year-over-year growth that surpassed management's guidance range of $635 million to $645 million, indicating strong demand for its cloud software solutions. The company's FY/25 guidance has been revised upward, projecting a midpoint revenue of $2.505 billion and an operating margin of 18%, supported by healthy customer retention rates exceeding 90% and net expansion rates above 110%. Additionally, Nutanix is expected to increase investments in sales and marketing, as well as research and development, which combined with a solid base of renewals and cost discipline, positions the company favorably for sustained profitability and free cash flow growth.

The analysis indicates that Nutanix Inc. faces a potential decline in revenue and margins, which could lead to a reduced enterprise value-to-sales (EV/S) multiple compared to its large-cap software peers. There are concerns about falling technology spending, challenges in acquiring new customers, lower renewal rates, and hardware supply chain disruptions, which collectively threaten the company's growth trajectory. Furthermore, Nutanix's history of operating losses raises the possibility of ongoing unprofitability, heightening risks amid a volatile market that typically penalizes high-growth stocks during corrections.