Restaurant software company (NYSE:OLO) will be reporting earnings tomorrow after market hours. Here’s what to look for.

Olo beat analysts’ revenue expectations by 1.3% last quarter, reporting revenues of $71.85 million, up 24.3% year on year. It was a satisfactory quarter for the company, with a solid beat of analysts’ EBITDA estimates but gross merchandise volume in line with analysts’ estimates.

Is Olo a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Olo’s revenue to grow 15.5% year on year to $72.79 million, slowing from the 26.6% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.07 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Olo has missed Wall Street’s revenue estimates three times over the last two years.

Looking at Olo’s peers in the vertical software segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Toast delivered year-on-year revenue growth of 29.2%, beating analysts’ expectations by 1.7%, and Agilysys reported revenues up 14.9%, falling short of estimates by 5.2%. Toast’s stock price was unchanged after the results, while Agilysys was down 20.1%.

Read our full analysis of Toast’s results here and Agilysys’s results here.

Stocks generally had a good 2024. The Fed fought high inflation and won without sending the economy into a recession, otherwise lovingly known as a soft landing. The US Central Bank is now cutting rates. That, plus the election of Donald Trump in November 2024, sent markets even higher, and while some of the vertical software stocks have shown solid performance, the group has generally underpeformed, with share prices down 2.8% on average over the last month. Olo is down 4.1% during the same time and is heading into earnings with an average analyst price target of $8.90 (compared to the current share price of $7.01).

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