8-K
false000162645000016264502023-08-032023-08-03

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

 

 

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 3, 2023

 

BigCommerce Holdings, Inc.

(Exact name of registrant as specified in charter)

Delaware

 

001-39423

 

46-2707656

(State or Other Jurisdiction of

 Incorporation)

 

(Commission File Number)

 

(I.R.S. Employer Identification

 Number)

 

11305 Four Points Drive

Building II, Suite 100

Austin, Texas 78726

(Address of principal executive offices, including zip code)

(512) 865-4500

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Series 1 Common Stock, $ 0.0001 par value per share

BIGC

The Nasdaq Global Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


 

Item 2.02 Results of Operations and Financial Condition.

On August 3, 2023, BigCommerce Holdings, Inc. (the “Company”) issued a press release announcing financial results for the three-month period ended June 30, 2023. The press release contains forward-looking statements regarding the Company, and includes cautionary statements identifying important factors that could cause actual results to differ materially from those anticipated.

The press release issued August 3, 2023 is furnished herewith as Exhibit 99.1. The information in this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liability of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as otherwise stated in such filing.

 

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit No.

Description

99.1

Press Release issued by BigCommerce Holdings, Inc. dated August 3, 2023.

104

 Cover page interactive data file (embedded within the inline XBRL document).

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

BigCommerce Holdings, Inc.

Date: August 3, 2023

By:

/s/ Daniel Lentz

 

 

Daniel Lentz

 

 

Chief Financial Officer

 

 

 


EX-99.1

Exhibit 99.1

BigCommerce Announces Second Quarter 2023 Financial Results
 

 

Second Quarter Total Revenue of $75.4 Million, an Increase of 11% Versus Prior Year; Total ARR of $331.1 Million, an Increase of 12% Versus Prior Year. Enterprise ARR of $236.4 Million, an Increase of 14% Versus Prior Year.

 

AUSTIN, Texas – August 3, 2023 – BigCommerce Holdings, Inc. (“BigCommerce”) (Nasdaq: BIGC), a leading Open SaaS ecommerce platform for fast-growing and established B2C and B2B brands, today announced financial results for its second quarter ended June 30, 2023.

 

“We hit two big milestones in the second quarter. We reached profitability on an adjusted EBITDA basis in June, and we delivered full-quarter positive free cash flow for the first time,” said Brent Bellm, CEO at BigCommerce. “We will continue the hard work required to achieve our long-term growth and profitability goals. With our recent leadership additions and product releases, I am confident we have the team, product, and execution ability to accomplish those goals.”

 

“Our results at the halfway point reflect progress in a number of areas,” said Daniel Lentz, CFO at BigCommerce. “Margin and cash flow improvements are notable and encouraging. The performance of the small business portion of our business has exceeded our expectations, and revenue and operating loss results have exceeded guidance. We continue to optimize for profitable growth in the midmarket and enterprise portions of our business as well.”

 

Second Quarter Financial Highlights:

Total revenue was $75.4 million, up 11% compared to the second quarter of 2022.
Total annual revenue run-rate (ARR) as of June 30, 2023 was $331.1 million, up 12% compared to June 30, 2022.
Subscription revenue was $56.1 million, up 10% compared to the second quarter of 2022.
ARR from accounts with at least one enterprise plan (“Enterprise Accounts”) was $236.4 million as of June 30, 2023, up 14% from June 30, 2022.
ARR from Enterprise Accounts as a percent of total ARR was 71% as of June 30, 2023, compared to 70% as of June 30, 2022.
GAAP gross margin was 75%, compared to 75% in the second quarter of 2022. Non-GAAP gross margin was 77%, compared to 77% in the second quarter of 2022.

 

Other Key Business Metrics

Number of enterprise accounts was 5,929, up 9% compared to the second quarter of 2022.
Average revenue per account (ARPA) of enterprise accounts was $39,870, up 5% compared to the second quarter of 2022.
Revenue in the Americas grew by 9% compared to the second quarter of 2022.
Revenue in EMEA grew by 27% and revenue in APAC grew by 3% compared to the second quarter of 2022.

 

Operating Income/(Loss)

GAAP operating loss was ($20.9) million, compared to ($39.1) million in the second quarter of 2022.

 


Exhibit 99.1

Non-GAAP operating loss was ($3.4) million, compared to ($13.7) million in the second quarter of 2022.

 

Net Income/(Loss) and Earnings Per Share

GAAP net loss was ($19.1) million, compared to ($39.6) million in the second quarter of 2022.
Non-GAAP net loss was ($1.5) million or (2%) of total revenue, compared to ($14.1) million or (21%) of total revenue in the second quarter of 2022.
GAAP net loss per share was ($0.25) based on 74.8 million weighted-average shares of common stock outstanding, compared to ($0.54) based on 73.1 million weighted-average shares of common stock outstanding in the second quarter of 2022.
Non-GAAP net loss per share was ($0.02) based on 74.8 million weighted-average shares of common stock outstanding, compared to ($0.19) based on 73.1 million weighted-average shares of common stock outstanding in the second quarter of 2022.

 

Adjusted EBITDA

Adjusted EBITDA was ($2.5) million, compared to ($12.9) million in the second quarter of 2022. Note: In comparison to prior year, results also include the removal of Other Income and Expense from Adjusted EBITDA, which was ($0.3) million for the three months ended June 30, 2022.

 

Cash

Cash, cash equivalents, restricted cash, and marketable securities totaled $298.5 million as of June 30, 2023.
For the six months ended June 30, 2023, net cash used in operating activities was ($6.1 million), compared to ($35.9) million for the same period in 2022. We reported free cash flow of ($8.2) million.
For the three months ended June 30, 2023, operating cash flow was $14.7 million, compared to ($13.9) million for the same period in 2022. We reported free cash flow of $13.7 million.

 

Business Highlights:

Corporate Highlights: BigCommerce hired technology industry veteran and experienced ecommerce sales leader Steven Chung as its president. Beginning Aug. 14, Chung will oversee BigCommerce’s sales, marketing and services organizations, consolidating the company’s go-to-market teams to fuel BigCommerce’s leadership in global ecommerce. Chung joins BigCommerce from Delphix, where, as president, he led the company’s strategic and commercial operations globally, including sales, business development, marketing, customer success, technical services, product support, solutions engineering, partnerships and office of the CTO. Chung previously held sales leadership roles at PagerDuty, a global SaaS company, and Demandware, where he led consecutive years of rapid growth resulting in a $2.8 billion acquisition by Salesforce in July 2016. Earlier in the quarter, the company announced the retirements of chief financial officer Robert Alvarez and chief legal officer Jeff Mengoli. Previous senior vice president of finance and investor relations Daniel Lentz was named the new CFO. Chuck Cassidy, previous vice president and associate legal counsel, was named general counsel. BigCommerce also hired Hubert Ban as the company’s chief accounting officer, replacing vice president of accounting and principal accounting officer Thomas Aylor. Ban joined BigCommerce from Salesforce, where he worked since 2008 and served as senior vice president of SEC reporting and technical accounting since 2020. In June, BigCommerce was named a Major Contender in Everest Group’s 2023 Digital Commerce Platform PEAK Matrix, scoring second highest among competitors in both Visibility and Capability. In July, the company achieved 24 out of 24 total medals in the 2023 Paradigm B2B Combines for Digital Commerce Solutions (Enterprise and Midmarket Editions), surpassing previous analyst evaluations for the fourth consecutive year. BigCommerce increased its rankings in a total of six categories in both Editions, solidifying its position as a preferred ecommerce platform for midmarket and enterprise B2B brands looking to grow and scale their business.

 


Exhibit 99.1

 

Product Highlights: In July, BigCommerce announced it will add new AI-powered features to its platform, leveraging Google Cloud’s AI technologies. With the new features, enterprise merchants will have the potential to improve operational efficiencies, elevate customer experiences, enhance product discovery and help drive more sales. BigCommerce AI-powered solutions will start to be globally available by the end of 2023. By automating processes with AI across their ecommerce operations, merchants can save time and improve operational efficiency and productivity by using AI algorithms to streamline workflows, accelerate product development cycles, reduce costs and accelerate time-to-market. The company also announced plans to add new functionality to its multi-storefront (MSF) offering to expand the ability of merchants to reach and sell to consumers regardless of where they live, what language they speak or what currency they use. Building on BigCommerce’s powerful enterprise-grade multi-storefront functionality, international enhancements for MSF will enable merchants to create localized experiences with unique content and settings for each storefront.

 

Merchant Highlights: Barbecues Galore, an Australian merchant selling grills, grilling accessories and outdoor furniture, became the first merchant transacting with B2B Edition Multi-Storefront, and they went live in just 12 weeks. Square Enix, the company behind some of the world’s most popular gaming franchises including Final Fantasy, Dragon Quest and Tomb Raider, launched multiple new stores to power their multi-language and multi-currency needs in North America, EMEA and APAC and enable their customers to purchase games across multiple platforms, including digital games redeemed through the Steam marketplace. US-based hunting, fishing and outdoor retailer Rogers Sporting Goods launched a new B2C site using our native Stencil framework and integrated with their Lightspeed point-of-sale system. BMW Group UK, a leading supplier of BMW and MINI original parts, partnered with Autofixa Solutions to launch new stores for both brands, featuring ERP integrations that sync inventory supplies and pricing data directly with the stores. Francesca’s, a popular women’s clothing brand with more than 450 stores, is taking advantage of BigCommerce’s Page Builder tool combined with a customized theme and customized checkout in order to deliver unique, free-spirited fashion and lifestyle products to its customers. Vinomofo, a leading online wine retailer in Australia and Singapore, launched a new headless store to enable horizontal and vertical growth, streamline business processes, enhance speed-to-market and cultivate user engagement. The DOM, an Australian direct outlet mall selling global brands, launched a new storefront powered by the first integration between BigCommerce and marketplace operator platform Marketplacer, developed entirely in-house by our partner Web Force 5. MKM Building Supplies, the largest independent builder's merchant in the UK with over 100 branches across England, Scotland and Wales, was honored with a MACH Impact Award for its new website built with headless technology to deliver a first-class digital purchasing experience for new and existing MKM customers. The project involved re-platforming the former MKM website to BigCommerce. The MACH Impact Awards honor the most globally innovative and impactful technology projects that utilize a composable commerce approach.

 

Partner Highlights: In May, the company announced a partnership with Oracle NetSuite, making available a NetSuite-provided integration that connects BigCommerce to NetSuite’s business system to help merchants streamline and automate financial, inventory and order management processes.

 

 

 


Exhibit 99.1

Q3 and 2023 Financial Outlook:

 

For the third quarter of 2023, the Company currently expects:

 

Total revenue between $76.3 million to $79.3 million, implying a year-over-year growth rate of 5% to 10%.
Non-GAAP operating loss is expected to be between $1.0 million to $5.0 million.

 

For the full year 2023, the Company currently expects:

Total revenue between $304.0 million and $310.0 million, translating into a year-over-year growth rate of 9% and 11%.
Non-GAAP operating loss between $10.2 million and $15.2 million.

 

The Company’s third quarter and 2023 financial outlook is based on a number of assumptions that are subject to change and many of which are outside the Company’s control. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that the Company will achieve these results.

The Company does not provide guidance for operating loss, the most directly comparable GAAP measure to Non-GAAP operating loss, and similarly cannot provide a reconciliation between its forecasted Non-GAAP operating loss and Non-GAAP net loss per share and these comparable GAAP measures without unreasonable effort due to the unavailability of reliable estimates for certain items. These items are not within the Company’s control and may vary greatly between periods and could significantly impact future financial results.

Conference Call Information

BigCommerce will host a conference call and webcast at 4:00 p.m. CT (5:00 p.m. ET) on Thursday, August 3, 2023, to discuss its financial results and business highlights. The conference call can be accessed by dialing (833) 634-1254 from the United States and Canada or (412) 317-6012 internationally and requesting to join the “BigCommerce conference call.” The live webcast of the conference call and other materials related to BigCommerce’s financial performance can be accessed from BigCommerce’s investor relations website at http://investors.bigcommerce.com.

Following the completion of the call through 11:59 p.m. ET on Thursday, August 10, 2023, a telephone replay will be available by dialing (877) 344-7529 from the United States, (855) 669-9658 from Canada or (412) 317-0088 internationally with conference ID 4691046. A webcast replay will also be available at http://investors.bigcommerce.com for 12 months.

About BigCommerce

BigCommerce (Nasdaq: BIGC) is a leading open software-as-a-service (SaaS) ecommerce platform that empowers merchants of all sizes to build, innovate and grow their businesses online. BigCommerce provides merchants sophisticated enterprise-grade functionality, customization and performance with simplicity and ease-of-use. Tens of thousands of B2C and B2B companies across 150 countries and numerous industries use BigCommerce to create beautiful, engaging online stores, including Ben & Jerry’s, Molton Brown, S.C. Johnson, Skullcandy, SoloStove, Ted Baker and Vodafone. Headquartered in Austin, BigCommerce has offices in London, Kyiv, San Francisco, and Sydney. For more information, please visit www.bigcommerce.com or follow us on Twitter, LinkedIn, Instagram and Facebook.

 

 


Exhibit 99.1

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “outlook,” “may,” “might,” “plan,” “project,” “will,” “would,” “should,” “could,” “can,” “predict,” “potential,” “strategy, “target,” “explore,” “continue,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. These statements may relate to our market size and growth strategy, our estimated and projected costs, margins, revenue, expenditures and customer and financial growth rates, our Q3 and 2023 financial outlook, our plans and objectives for future operations, growth, initiatives or strategies. By their nature, these statements are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance or achievement to differ materially and adversely from those anticipated or implied in the forward-looking statements. These assumptions, uncertainties and risks include that, among others, our business would be harmed by any decline in new customers, renewals or upgrades, our limited operating history makes it difficult to evaluate our prospects and future results of operations, we operate in competitive markets, we may not be able to sustain our revenue growth rate in the future, our business would be harmed by any significant interruptions, delays or outages in services from our platform or certain social media platforms, and a cybersecurity-related attack, significant data breach or disruption of the information technology systems or networks could negatively affect our business. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption “Risk Factors” and elsewhere in our filings with the Securities and Exchange Commission (the “SEC”), including our Annual Report on Form 10-K for the year ended December 31, 2022, our Quarterly report on Form 10-Q filed with the SEC on August 4, 2023, and the future quarterly and current reports that we file with the SEC. Forward-looking statements speak only as of the date the statements are made and are based on information available to BigCommerce at the time those statements are made and/or management's good faith belief as of that time with respect to future events. BigCommerce assumes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law.

 

Use of Non-GAAP Financial Measures

We have provided in this press release certain financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Our management uses these Non-GAAP financial measures internally in analyzing our financial results and believes that use of these Non-GAAP financial measures is useful to investors as an additional tool to evaluate ongoing operating results and trends and in comparing our financial results with other companies in our industry, many of which present similar Non-GAAP financial measures. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable financial measures prepared in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. A reconciliation of our historical Non-GAAP financial measures to the most directly comparable GAAP measures has been provided in the financial statement tables included in this press release, and investors are encouraged to review these reconciliations.

Annual Revenue Run-Rate

We calculate annual revenue run-rate (“ARR”) at the end of each month as the sum of: (1) contractual monthly recurring revenue at the end of the period, which includes platform subscription fees, invoiced growth adjustments, feed management subscription fees, recurring professional services revenue, and other recurring revenue, multiplied by twelve to prospectively annualize recurring revenue, and (2) the sum of the trailing twelve-month non-recurring

 


Exhibit 99.1

and variable revenue, which includes one-time partner integrations, one-time fees, payments revenue share, and any other revenue that is non-recurring and variable.

Accounts with Greater than $2,000 ACV

We track the total number of accounts with annual contract value (“ACV”) greater than $2,000 (the “ACV threshold”) as of the end of a monthly billing period. To define this $2,000 ACV cohort, we include only subscription plan revenue and exclude partner and services revenue and recurring services revenue. We consider all stores and brands added and subtracted as of the end of the monthly billing period. This metric includes accounts that may have either one single store or brand above the ACV threshold or multiple stores or brands that together exceed the ACV threshold.

Enterprise Account Metrics

To measure the effectiveness of our ability to execute against our growth strategy, particularly within the mid-market and enterprise business segments, we calculate ARR attributable to Enterprise Accounts. We define Enterprise Accounts as accounts with at least one unique Enterprise plan subscription or an enterprise level feed management subscription (collectively “Enterprise Accounts”). These accounts may have more than one Enterprise plan or a combination of Enterprise plans and Essentials plans.

Average Revenue Per Account

We calculate average revenue per account (ARPA) for accounts above the ACV threshold at the end of a period by including customer-billed revenue and an allocation of partner and services revenue, where applicable. We allocate partner revenue, where applicable, primarily based on each customer’s share of GMV processed through that partner’s solution. For partner revenue that is not directly linked to customer usage of a partner’s solution, we allocate such revenue based on each customer’s share of total platform GMV. Each account’s partner revenue allocation is calculated by taking the account’s trailing twelve-month partner revenue, then dividing by twelve to create a monthly average to apply to the applicable period in order to normalize ARPA for seasonality.

Adjusted EBITDA

We define Adjusted EBITDA as our net loss, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions, depreciation, amortization of acquisition-related intangible assets, interest income, interest expense, changes in fair value of financial instruments, restructuring charges, other non-operating income and expense and our provision for income taxes. The most directly comparable GAAP measure is net loss.

Non-GAAP Operating Loss

We define Non-GAAP Operating Loss as our GAAP Loss from operations, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions, amortization of acquisition-related intangible assets, and restructuring charges. The most directly comparable GAAP measure is our loss from operations.

Non-GAAP Net Loss

 


Exhibit 99.1

We define Non-GAAP Net Loss as our GAAP net loss, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions, amortization of acquisition-related intangible assets, restructuring charges and changes in fair value of financial instruments. The most directly comparable GAAP measure is our net loss.

Non-GAAP Net Loss per Share

We define Non-GAAP Net Loss per Share as our Non-GAAP Net Loss, defined above, divided by our basic and diluted GAAP weighted average shares outstanding. The most directly comparable GAAP measure is our net loss per share.

Free Cash Flow

We define Free Cash flow as our GAAP cash flow from operating activities plus our GAAP purchases of property and equipment (Capital Expenditures). The most directly comparable GAAP measure is our cash flow from operating activities.

Media Relations Contact Investor Relations Contact

Brad Hem Daniel Lentz

PR@BigCommerce.com InvestorRelations@BigCommerce.com

 

 


Exhibit 99.1

Consolidated Balance Sheet

(in thousands)

 

 

 

June 30,

 

December 31,

 

 

2023

 

2022

 

 

(Unaudited)

 

 

Assets

 

 

 

 

Current assets

 

 

 

 

Cash and cash equivalents

 

$74,517

 

$91,573

Restricted cash

 

1,114

 

1,457

Marketable securities

 

222,890

 

211,941

Accounts receivable, net

 

52,151

 

51,899

Prepaid expenses and other assets

 

13,455

 

11,206

Deferred commissions

 

6,995

 

6,171

Total current assets

 

371,122

 

374,247

Property and equipment, net

 

10,362

 

9,083

Operating lease, right-of-use-assets

 

5,042

 

5,887

Prepaid expenses and other assets, net of current portion

 

728

 

470

Deferred commissions, net of current portion

 

6,985

 

7,037

Intangible assets, net

 

23,517

 

27,583

Goodwill

 

49,749

 

49,749

Total assets

 

$467,505

 

$474,056

Liabilities and stockholders’ equity

 

 

 

 

Current liabilities

 

 

 

 

Accounts payable

 

$6,485

 

$7,013

Accrued liabilities

 

3,673

 

2,937

Deferred revenue

 

28,245

 

17,783

Current portion of long-term debt

 

399

 

Current portion of operating lease liabilities

 

2,563

 

2,609

Other current liabilities

 

50,138

 

48,444

Total current liabilities

 

91,503

 

78,786

Deferred revenue, net of current portion

 

712

 

1,759

Long-term debt

 

339,036

 

337,497

Operating lease liabilities, net of current portion

 

8,695

 

10,008

Other long-term liabilities, net of current portion

 

639

 

334

Total liabilities

 

440,585

 

428,384

Commitments and contingencies (Note 7)

 

 

 

 

Stockholders’ equity

 

 

 

 

Preferred stock, $0.0001 par value; 10,000 shares authorized
at June 30, 2023 and December 31, 2021; 0 shares
issued and outstanding, at June 30, 2023 and December 31, 2022.

 

 

Common stock, $0.0001 par value; 500,000 shares Series 1 authorized at June 30, 2023 and December 31, 2022; 75,064 and 73,945 shares Series 1 issued and outstanding at June 30, 2023 and December 31, 2022, respectively.

 

7

 

7

Additional paid-in capital

 

598,657

 

576,851

Accumulated other comprehensive loss

 

(572)

 

(1,199)

Accumulated deficit

 

(571,172)

 

(529,987)

Total stockholders’ equity

 

26,920

 

45,672

Total liabilities and stockholders’ equity

 

$467,505

 

$474,056

 

 

 

 


Exhibit 99.1

Consolidated Statement of Operations

(in thousands, except per share amounts)

(unaudited)

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

 

 

 

 

 

 

 

 

 

Revenue

 

$75,443

 

$68,203

 

$147,200

 

$134,253

Cost of revenue

 

18,756

 

16,860

 

36,202

 

33,963

Gross profit

 

56,687

 

51,343

 

110,998

 

100,290

Operating expenses:

 

 

 

 

 

 

 

 

Sales and marketing

 

35,593

 

36,033

 

69,645

 

69,672

Research and development

 

21,403

 

22,394

 

42,248

 

43,339

General and administrative

 

14,428

 

17,526

 

30,922

 

33,372

Acquisition related expenses

 

4,125

 

12,521

 

8,250

 

25,181

Restructuring charges

 

 

 

420

 

Amortization of intangible assets

 

2,033

 

2,009

 

4,066

 

4,046

Total operating expenses

 

77,582

 

90,483

 

155,551

 

175,610

Loss from operations

 

(20,895)

 

(39,140)

 

(44,553)

 

(75,320)

Interest income

 

2,825

 

577

 

5,251

 

699

Interest expense

 

(722)

 

(705)

 

(1,444)

 

(1,414)

Other expense

 

(63)

 

(297)

 

(32)

 

(452)

Loss before provision for income taxes

 

(18,855)

 

(39,565)

 

(40,778)

 

(76,487)

Provision for income taxes

 

210

 

40

 

407

 

155

Net loss

 

$(19,065)

 

$(39,605)

 

$(41,185)

 

$(76,642)

Basic and diluted net loss per share

 

$(0.25)

 

$(0.54)

 

$(0.55)

 

$(1.05)

Shares used to compute basic and diluted net loss per share

 

74,790

 

73,084

 

74,468

 

72,782

 

 


Exhibit 99.1

Consolidated Statement of Cash Flows

(in thousands)

(unaudited)

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

 

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net loss

 

$(19,065)

 

$(39,605)

 

$(41,185)

 

$(76,642)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

2,940

 

2,821

 

5,844

 

5,647

Amortization of discount on debt

 

494

 

490

 

987

 

978

Stock-based compensation

 

11,290

 

10,578

 

21,777

 

19,540

Allowance for credit losses

 

433

 

2,086

 

1,508

 

3,399

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

6,425

 

(6,999)

 

(1,760)

 

(9,501)

Prepaid expenses

 

751

 

1,816

 

(3,484)

 

1,010

Deferred commissions

 

(821)

 

(1,397)

 

(772)

 

(2,055)

Accounts payable

 

(1,023)

 

(1,642)

 

(528)

 

(1,929)

Accrued and other liabilities

 

7,027

 

15,550

 

2,105

 

21,252

Deferred revenue

 

6,292

 

2,427

 

9,415

 

2,441

Net cash provided by (used) in operating activities

 

14,743

 

(13,875)

 

(6,093)

 

(35,860)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Cash paid for acquisition

 

 

(696)

 

 

(696)

Purchase of property and equipment

 

(1,017)

 

(2,146)

 

(2,080)

 

(3,486)

Sales and maturities of marketable securities

 

83,643

 

33,600

 

123,072

 

42,600

Purchase of marketable securities

 

(85,351)

 

(46,800)

 

(133,394)

 

(79,273)

Net cash used in investing activities

 

(2,725)

 

(16,042)

 

(12,402)

 

(40,855)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Proceeds from financing obligation

 

1,081

 

 

1,081

 

Taxes paid related to net share settlement of equity awards

 

(811)

 

 

(2,230)

 

(3,099)

Proceeds from exercise of stock options

 

1,156

 

(292)

 

2,245

 

2,991

Net cash provided by (used in) financing activities

 

1,426

 

(292)

 

1,096

 

(108)

Net change in cash and cash equivalents and restricted cash

 

13,444

 

(30,209)

 

(17,399)

 

(76,823)

Cash and cash equivalents and restricted cash, beginning of period

 

62,187

 

252,090

 

93,030

 

298,704

Cash and cash equivalents and restricted cash, end of period

 

$75,631

 

$221,881

 

$75,631

 

$221,881

Supplemental cash flow information:

 

 

 

 

 

 

 

 

Cash paid for interest

 

$—

 

$—

 

$431

 

$472

Cash paid for taxes

 

$60

 

$—

 

$212

 

$32

Noncash investing and financing activities:

 

 

 

 

 

 

 

 

Changes in capital additions, accrued but not paid

 

$125

 

$9

 

$190

 

$105

Fair value of shares issued as consideration for acquisition

 

$—

 

$4,614

 

$—

 

$4,614

Reconciliation of cash, cash equivalents and restricted cash within the condensed consolidated balance sheet to the amounts shown in the statements of cash flows above:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$74,517

 

$220,550

 

$74,517

 

$220,550

Restricted cash

 

1,114

 

1,331

 

1,114

 

1,331

Total cash, cash equivalents and restricted cash

 

$75,631

 

$221,881

 

$75,631

 

$221,881

 

 

 

 

 

 


Exhibit 99.1

Disaggregated Revenue:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

(in thousands)

 

2023

 

2022

 

2023

 

2022

Subscription solutions

 

$56,135

 

$51,285

 

$109,943

 

$99,272

Partner and services

 

19,308

 

16,918

 

37,257

 

34,981

Total revenue

 

$75,443

 

$68,203

 

$147,200

 

$134,253

Revenue by Geography:

(unaudited)

 

 

Three months ended June 30,

 

Six months ended June 30,

(in thousands)

 

2023

 

2022

 

2023

 

2022

Revenue:

 

 

 

 

 

 

 

 

Americas – U.S.

 

$57,546

 

$52,760

 

$112,355

 

$104,260

Americas – other

 

3,422

 

2,988

 

6,773

 

5,672

EMEA

 

8,649

 

6,802

 

16,633

 

13,086

APAC

 

5,826

 

5,653

 

11,439

 

11,235

Total revenue

 

$75,443

 

$68,203

 

$147,200

 

$134,253

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Exhibit 99.1

Reconciliation of GAAP to Non-GAAP Results

(in thousands, except per share amounts)

 

 

Reconciliation of operating loss to Non-GAAP operating loss:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Operating loss

 

$(20,895)

 

$(39,140)

 

$(44,553)

 

$(75,320)

Less: stock-based compensation expense

 

11,290

 

10,578

 

21,777

 

19,540

Less: payroll tax associated with stock-based compensation expense

 

82

 

356

 

233

 

502

Less: third-party acquisition related costs

 

4,125

 

12,521

 

8,250

 

25,181

Less: restructuring charges

 

 

 

420

 

Less: amortization of intangible assets

 

2,033

 

2,009

 

4,066

 

4,046

Non-GAAP operating loss

 

$(3,365)

 

$(13,676)

 

$(9,807)

 

$(26,051)

Non-GAAP operating margin

 

(4.5)%

 

(20.1)%

 

(6.7)%

 

(19.4)%

 

 

Reconciliation of net loss & net loss per share to Non-GAAP net loss & Non-GAAP net loss per share:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Net loss

 

$(19,065)

 

$(39,605)

 

$(41,185)

 

$(76,642)

Less: stock-based compensation expense

 

11,290

 

10,578

 

21,777

 

19,540

Less: payroll tax associated with stock-based compensation expense

 

82

 

356

 

233

 

502

Less: third-party acquisition related costs

 

4,125

 

12,521

 

8,250

 

25,181

Less: restructuring charges

 

 

 

420

 

Less: amortization of intangible assets

 

2,033

 

2,009

 

4,066

 

4,046

Non-GAAP net loss

 

$(1,535)

 

$(14,141)

 

$(6,439)

 

$(27,373)

Non-GAAP net loss per share

 

$(0.02)

 

$(0.19)

 

$(0.09)

 

$(0.38)

Shares used to compute basic and diluted net loss per share

 

74,790

 

73,084

 

74,468

 

72,782

Non-GAAP net loss margin

 

(2.0)%

 

(20.7)%

 

(4.4)%

 

(20.4)%

 

 

 

 

 

 

 

 

 

 

 

 


Exhibit 99.1

Reconciliation of net loss to adjusted EBITDA:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Net loss

 

$(19,065)

 

$(39,605)

 

$(41,185)

 

$(76,642)

Stock-based compensation expense

 

11,290

 

10,578

 

21,777

 

19,540

Payroll tax associated with stock-based compensation expense

 

82

 

356

 

233

 

502

Third-party acquisition related costs

 

4,125

 

12,521

 

8,250

 

25,181

Restructuring charges

 

 

 

420

 

Depreciation

 

906

 

812

 

1,778

 

1,601

Amortization of intangible assets

 

2,033

 

2,009

 

4,066

 

4,046

Interest income

 

(2,825)

 

(577)

 

(5,251)

 

(699)

Interest expense

 

722

 

705

 

1,444

 

1,414

Other income/expense

 

63

 

297

 

32

 

452

Provision for income
   taxes

 

210

 

40

 

407

 

155

Adjusted EBITDA

 

$(2,459)

 

$(12,864)

 

$(8,029)

 

$(24,450)

Adjusted EBITDA Margin

 

(3.3)%

 

(18.9)%

 

(5.5)%

 

(18.2)%

 

 

Reconciliation of cost of revenue to Non-GAAP cost of revenue:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Cost of revenue

 

$18,756

 

$16,860

 

$36,202

 

$33,963

Less: share-based compensation expense

 

1,281

 

978

 

2,457

 

1,840

Less: payroll tax associated with share-based compensation expense

 

9

 

9

 

22

 

15

Non-GAAP cost of revenue

 

$17,466

 

$15,873

 

$33,723

 

$32,108

As a % of revenue

 

23.2%

 

23.3%

 

22.9%

 

23.9%

 

 

Reconciliation of sales and marketing expense to Non-GAAP sales and marketing expense:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Sales and marketing

 

$35,593

 

$36,033

 

$69,645

 

$69,672

Less: share-based compensation expense

 

3,529

 

3,523

 

6,337

 

6,434

Less: payroll tax associated with share-based compensation expense

 

37

 

43

 

96

 

106

Non-GAAP sales and marketing

 

$32,027

 

$32,467

 

$63,212

 

$63,132

As a % of revenue

 

42.5%

 

47.6%

 

42.9%

 

47.0%

 

 

 

 

 

 


Exhibit 99.1

 

Reconciliation of research and development expense to Non-GAAP research and development expense:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Research and development

 

$21,403

 

$22,394

 

$42,248

 

$43,339

Less: share-based compensation expense

 

3,929

 

3,029

 

7,390

 

5,555

Less: payroll tax associated with share-based compensation expense

 

14

 

13

 

56

 

50

Non-GAAP research and development

 

$17,460

 

$19,352

 

$34,802

 

$37,734

As a % of revenue

 

23.1%

 

28.4%

 

23.6%

 

28.1%

 

 

Reconciliation of general and administrative expense to Non-GAAP general and administrative expense:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

General & administrative

 

$14,428

 

$17,526

 

$30,922

 

$33,372

Less: share-based compensation expense

 

2,551

 

3,048

 

5,593

 

5,711

Less: payroll tax associated with share-based compensation expense

 

22

 

291

 

59

 

331

Non-GAAP general & administrative

 

$11,855

 

$14,187

 

$25,270

 

$27,330

As a % of revenue

 

15.7%

 

20.8%

 

17.2%

 

20.4%

 

 

Reconciliation of net cash used in operating activities to free cash flow:

(unaudited)

 

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

(in thousands)

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities

 

$14,743

 

$(13,875)

 

$(6,093)

 

$(35,860)

Purchase of property and equipment

 

(1,017)

 

(2,146)

 

(2,080)

 

(3,486)

Free cash flow

 

$13,726

 

$(16,021)

 

$(8,173)

 

$(39,346)