New Relic (NYSE:NEWR) reported its Q4 results yesterday, with EPS of $0.42 and revenue of $242.5 million coming in better than the Street estimates of $0.22 and $241.13 million, respectively. Shares plunged more than 5% intra-day today.

Analysts at RBC Capital provided their key takeaways from the results, which include: (1) initial 2024 guidance calls for lackluster 10-11% growth, led by cloud optimization and the decision to accelerate migrations to consumption, (2) incremental disclosures do outline a path to 2025 acceleration, highlighted by consumption revenue growing 32%, and (3) 2024 guidance calls for mid-teens margins, well above the preliminary outlook.

The company expects Q1/24 revenue in the range of $238-$240 million, compared to the Street estimate of $251.2 million. For the full year, the company expects revenue of $1.020-1.030 billion, compared to the Street’s $924.3 million.