Splunk Still Looking to Expand Size Before it Expands Profit

Splunk (News - Alert) is a company that has seen quite a bit of growth over the last few years, thanks in large part to the number of different areas in which it has worked hard to grow. Now, the company has announced that it expects to break even on an adjusted basis and will add about 2,000 customers to its base by the end of this year.

The company will be growing its customer base by about 40 percent if those projections actually come to fruition.

The company, which works in the cloud and performs several different services in the big data arena, announced it has seen some high revenue growth since the beginning of 2013, and in the last couple of years. Despite the fact that revenue growth has been increasing over the last several fiscal years, the company has not actually turned a profit yet.

Part of the reason is that the company believes reinvestment in employees and improving service will eventually mean the most to its bottom line.

By 2014, the company expects to actually have its employee numbers increase by about 40 percent. Splunk says its investors have said they understand why this approach is being undertaken, and investors are also encouraging the approach to continue despite the lack of real financial success of late.

CEO Godfrey Sullivan (News - Alert) talked about what Splunk is trying to do and why they feel the approach is the right one for the big data company. The company’s investors, he said, are “pretty pleased,” and that is reflected in the company’s stock price.

Splunk is a big data company that debuted with a stock price of $17 per share, and has seen that price actually double after an April IPO last year. Part of the reason investors are still bullish on the company is because there is expected to be about $54.59 billion of IT revenue in big data by the end of 2016.

That number is in sharp contrast to the $27 billion that was made in 2011.