(Corrects revenue figure in paragraph 9 to $445 million, not
By Lauren Hirsch
Sept 29 Nutanix Inc said on Thursday it
sold a more than expected 14.87 million shares priced at $16,
valuing the company at more than $2 billion.
San Jose, California-based Nutanix's share price exceeds the
$13.40 value last placed on its shares in a 2014 funding round,
an upgrade encouraging for the many unprofitable technology
companies that, like Nutanix, have been weary of testing public
Nutanix sold 14.87 million shares on Thursday, more than the
anticipated 14 million. Its $16 IPO price was above its
indicated range of $13 and $15.
"Nutanix is a very important deal for technology, because
as a deal that will be above its private valuation. It is a sign
that there's an appetite for a high-growth company that doesn't
yet have earnings," said Kathleen Smith, a principal at
Renaissance Capital, which manages IPO-focused exchange traded
Nutanix, which is unprofitable, was valued at $2 billion
after its last financing round and delayed its expected January
IPO amid market jitters that froze much of the market for
Many technology companies in Silicon Valley, which has been
awash in private funding for the past several years, have
enjoyed lofty valuations without being profitable. It has been
uncertain whether these companies could beat or even replicate
such valuations in the public market. In the latter half of last
year into this spring, businesses such as Square Inc had
so-called "down-round IPOs", public offerings which valued the
company at less than their last private fundraise.
While late-stage investors in these companies can ensure
financial protection in such down-rounds through the use of
so-called "ratchets", they can hurt company morale and lower the
financial return for earlier stage investors.
A recent string of technology IPOs has demonstrated growing
investor favor for technology companies. Shares of software
company Twilio Inc, which is not profitable are now
trading nearly four times above their June IPO price.
Nutanix had revenue of $445 million in its 2016 fiscal year
and reported a net loss of $168 million. It acquired two small
cloud software acquisitions this summer, PernixData and Calm.io.
Nutanix will use proceeds from the IPO for general
corporate purposes and potentially for acquisitions.
It plans to list Friday on Nasdaq under the symbol "NTNX"
Goldman Sachs Group, Morgan Stanley, JPMorgan
Chase & Co and RBC Capital Markets are among
underwriters for the offering.
(Reporting by Lauren Hirsch; Editing by Lisa Shumaker)