Beaten-down cloud software stocks get boost as ServiceNow and Qualtrics top estimates
Maybe cloud investors just needed a little reassurance.

Following a brutal stretch that's seen one cloud computing index tumble 38% from an all-time high in November, two key members of the group — ServiceNow and Qualtrics — delivered optimistic numbers on Wednesday, spurring an after-market rally in their share prices.

ServiceNow, whose software automates back-office IT tasks and workflows, jumped 10% on better-than-expected first-quarter results and an upbeat outlook for the year.

Qualtrics, a provider of software that helps companies communicate with customers and track their experience, climbed more than 9% after soaring past estimates for the fourth quarter and in beating expectations with its 2022 guidance.

Tech stocks entered earnings season in a downward spiral, with the Nasdaq headed for its worst month since 2008. The index is still down 13% in January, but most of the companies that have reported so far have provided signs of optimism.

"We are in a sustained demand environment here," ServiceNow CEO Bill McDermott said on the earnings call after his company reported 29% growth in the fourth quarter and predicted 26% growth in subscription revenue for the year.

Microsoft and Intel beat on the top and bottom lines this week and exceeded estimates with their guidance, while IBM and Tesla also reported better-than-expected results. Among the most notable large-cap names, only Netflix has disappointed investors, as the company's prediction for subscriber growth came in far below estimates.