What Happened?
Shares of customer experience management platform Sprinklr (NYSE: CXM) jumped 3.2% in the afternoon session after comments from a key Federal Reserve official bolstered hopes for an interest rate cut.
The positive sentiment followed comments from New York Federal Reserve President John Williams, a voting member of the rate-setting Federal Open Market Committee (FOMC), who indicated he sees room for further policy easing. Following his remarks, the probability of a December rate cut surged from 39% to 71%, according to the CME FedWatch Tool, causing Treasury yields to fall. Lower interest rates can be particularly beneficial for growth-oriented sectors like software, as they increase the present value of future earnings. This renewed hope provided a boost to the sector, which had recently faced pressure from concerns over high valuations in artificial intelligence.
The shares closed the day at $7.12, up 2.7% from previous close.
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What Is The Market Telling Us
Sprinklr’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 8 months ago when the stock gained 19.1% on the news that the company reported decent fourth-quarter 2024 results: Sales beat by a modest margin while EPS beat more convincingly.
The key highlight for the quarter was the 18% increase in high-value customers spending over $1 million annually, which continued to help the more modest subscription revenue growth (up 3% year-over-year). Looking ahead, revenue guidance told a similar story, with projected growth of just over 3%, a deceleration from the 9% increase in 2024. On a more positive note, full-year EPS guidance exceeded expectations, hinting at management's confidence in cost controls or efficiency improvements to offset weaker sales growth. Overall, this was a decent yet mixed quarter: while bottom-line performance was solid, the revenue outlook points to slowing demand.
Sprinklr is down 16.9% since the beginning of the year, and at $7.10 per share, it is trading 24.7% below its 52-week high of $9.42 from March 2025. Investors who bought $1,000 worth of Sprinklr’s shares at the IPO in June 2021 would now be looking at an investment worth $403.12.
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