- Needham analyst Scott Berg acknowledged Five9, Inc's FIVN solid 2Q results highlighted by its second strongest bookings quarter to date.
- While FIVN did not have a repeat mega-deal as in 1Q, the bookings strength was broad-based, with higher customer demand for Contact Center automation solutions now comprising 10% of bookings driving incremental upside, he noted.
- On the positive side, besides top-level bookings, gross margins have appeared to trough as the company gained leverage from its PS hires, and partner contribution increased 52% Y/Y, which he viewed as a strong signal that its product strategy resonated well.
- On the cautious side, the revenue outperformance was lower than 2Q in FY19 or FY20, with some modest sales cycle extensions.
- He viewed the 2H guidance as fairly de-risking this impact, given the company's strong bookings to revenue conversion visibility.
- Berg reiterated a Buy with a price target of $160.
- Price Action: FIVN shares traded higher by 9.11% at $107.34 on the last check Friday.
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