Stock Analysis

Smartsheet Inc.'s (NYSE:SMAR) Shift From Loss To Profit

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Smartsheet Inc. (NYSE:SMAR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Smartsheet Inc. provides cloud-based enterprise platform to plan, capture, manage, automate, and report on work for teams and organizations. On 31 January 2023, the US$6.1b market-cap company posted a loss of US$216m for its most recent financial year. Many investors are wondering about the rate at which Smartsheet 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.

See our latest analysis for Smartsheet

According to the 18 industry analysts covering Smartsheet, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$142m in 2026. Therefore, the company is expected to breakeven roughly 3 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2026? Working backwards from analyst estimates, it turns out that they expect the company to grow 29% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

NYSE:SMAR Earnings Per Share Growth March 19th 2023

We're not going to go through company-specific developments for Smartsheet given that this is a high-level summary, but, bear in mind that by and large 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 Smartsheet has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Smartsheet, so if you are interested in understanding the company at a deeper level, take a look at Smartsheet's company page on Simply Wall St. We've also put together a list of important factors you should look at:

  1. Valuation: What is Smartsheet 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 Smartsheet 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 Smartsheet’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.

What are the risks and opportunities for Smartsheet?

Smartsheet Inc. provides enterprise platform to plan, capture, manage, automate, and report on work for teams and organizations.

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  • Trading at 19.1% below our estimate of its fair value

  • Revenue is forecast to grow 16.29% per year


  • Shareholders have been diluted in the past year

  • Significant insider selling over the past 3 months

  • Currently unprofitable and not forecast to become profitable over the next 3 years

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