Zendesk has reported a loss of $95.1 million for Q2.
While the results may seem underwhelming, the vendor did outperform analyst estimates, with quarterly revenues reaching $407.2 million.
Also, the company is not alone in its unfortunate position, with the drop in valuation of enterprise technology vendors an almost universal trend. Yet, not to such an extent.
Indeed, 2022 has proven a challenging year for Zendesk.
Perhaps the best example is that it rejected a $17BN acquisition bid in February because it "undervalued" the company. However, five months later, it accepted a $10.2BN bid.
In the months between, Zendesk leaders battled with shareholders to push an acquisition of Momentive – the parent company of SurveyMonkey - over the line.
However, they failed to convince them, leading to this not-so-subtle tweet from Zendesk Founder, Chairman, and CEO Mikkel Svane:
Cornelius Tacitus was the original VC during ancient Rome. “The desire for safety stands against every great and noble enterprise”. Replace safety with portfolio return at your discretion.
— Mikkel Svane (@mikkelsvane) February 23, 2022
Indeed, Svanne’s plans for a "noble enterprise" seemed to pivot Zendesk more towards the data & analytics space.
When the deal fell apart, few growth opportunities lay on the table. As such, the acquisition route likely became much more attractive.
Yet, Zeus Kerravala, Founder and Principal Analyst at ZK Research, believes that Svane also aimed to position Zendesk as a platform rather than a product company.
Speaking to CX Today, Kerrevala stated:
