Domo (DOMO) Stock Forecast & Price Target

Domo Inc. has demonstrated robust growth in its long-term subscription remaining performance obligation (RPO), which increased by 44.1% year-over-year to $189.6 million, indicating strong customer commitment to multi-year contracts. Additionally, the company reported a gross retention rate of 85%, with expectations for improvement by the end of the fiscal year, further highlighting customer loyalty and satisfaction. Financial guidance has also been raised for FY2026, with revenue projected between $316 million and $320 million and an improved earnings per share forecast, reflecting management's confidence in sustained growth and operational performance.

Domo Inc. is facing a challenging financial outlook, as subscription revenue is projected to decline sequentially, contrasting sharply with a historical average of consistent revenue growth. The company is also grappling with potential retention issues and increasing competition, which may hinder its ability to expand within existing contracts and capture additional market share. Additionally, the significant net operating loss carryforwards, while providing some tax benefits, highlight the underlying struggle for the company to achieve sustainable profitability and mitigate the risks associated with competitive pressures and operational inefficiencies.