When Will Instructure Holdings, Inc. (NYSE:INST) Breakeven?

We feel now is a pretty good time to analyse Instructure Holdings, Inc.'s (NYSE:INST) business as it appears the company may be on the cusp of a considerable accomplishment. Instructure Holdings, Inc. provides cloud-based learning, assessment, development, and engagement systems worldwide. The US$3.5b market-cap company posted a loss in its most recent financial year of US$34m and a latest trailing-twelve-month loss of US$34m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Instructure Holdings will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for Instructure Holdings

Consensus from 12 of the American Software analysts is that Instructure Holdings is on the verge of breakeven. They expect the company to post a final loss in 2024, before turning a profit of US$8.4m in 2025. Therefore, the company is expected to breakeven just over a year from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 99%, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Instructure Holdings' upcoming projects, however, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we’d like to point out is that The company has managed its capital judiciously, with debt making up 38% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Instructure Holdings which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Instructure Holdings, take a look at Instructure Holdings' company page on Simply Wall St. We've also compiled a list of essential aspects you should further research:

1. Valuation: What is Instructure Holdings worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Instructure Holdings is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Instructure Holdings’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.