Instructure, the company behind Canvas LMS, held the third quarterly investors call last week, to report on end-of-period financials. While Instructure is not yet a profitable company, it is approaching black results thanks to growing revenue and lower operating costs in relative terms, increasing operating margins. It is basically a given at this point that Canvas is the leader among LMS in the US, the most valuable market. Having surpassed Blackboard in the number of active installations and users seems to have led to a higher valuation also. At market close, Instructure was valued at $1.23 billion USD. Blackboard market cap can only be estimated, as it is privately owned. Same goes for Moodle.
In the United States, more universities and K-12 institutions are making the switch, including loudly valuable sites serving tens of thousands of students. Similar news have been also reported abroad, with deals in the UK, Brazil, Chile and the Philippines. The current tally of clients is reported to be around the four thousand mark.
Compared to the previous quarter, gross profit continued to grow but so did operating expenses. As a result, net loses reached $12.5 million, the highest this year.
After the call, Instructure stock teacher a new height above $38 per share, but analysts at Citigroup believe they could climb as high as $50 in the coming months. 5 out of the 7 analysts following the company would recommend buying Instructure stock now (no one recommends selling). It has outperformed the S&P 500 for the year.