Tableau Software (DATA) continues to generate strong growth in Annual Recurring Revenue (or ARR) in the last five quarters, driven by its strong growth in billings. Higher demand for data analytics has led to strong growth in its customer portfolio.
Solid product pipelines, coupled with better maintenance and ease of installation across diverse platforms, act as strong catalysts for the company’s ARR growth. The company’s large customers include ExxonMobil (XOM), Honeywell (HON), Johnson & Johnson (JNJ), and several federal government agencies.
From the graph above, we can see the total ARR growth trend in the last five quarters for Tableau. During this period, it grew at a CAGR (compound annual growth rate) of 9.7%.
Subscription ARR and bookings
In 4Q17, Tableau Software’s ARR increased 45% YoY (year-over-year) to $596.0 million, buoyed by the robust growth in its Subscription’s annual recurring revenues. The company’s Subscription ARR improved at a staggering 235.0% YoY to $195.0 million, triggered by significant contract wins. In the last five quarters, it increased at a CAGR of 35.0%.
License bookings were flat year-over-year in 4Q17, compared with 25.0% growth in 4Q16. Ratable license bookings came in at 51.0% of total license bookings in 4Q17 versus 20.0% in 4Q16.
The company projects ratable license bookings to grow every quarter in fiscal 2018, which it expects to reach 55.0%–65.0% of total license bookings. The company’s policy to encourage subscription-based payments has led to this growth in ratable license bookings.