Domo, Inc. (Nasdaq: DOMO) today announced results for its fiscal
third quarter ended October 31, 2023.
Fiscal Third Quarter Results
- Total revenue was $79.7 million, an increase of 1% year over
year
- Subscription revenue was $71.3 million, an increase of 3% year
over year
- Subscription revenue represented 89% of total revenue
- Billings were $74.8 million, an increase of 1%
year-over-year
- Remaining Performance Obligations (RPO) was $367.2 million as
of October 31, 2023, an increase of 4% year over year
- RPO expected to be recognized as revenue in the next 12 months
was $230.8 million as of October 31, 2023, consistent with Q3
FY23
- Net cash used in operating activities was $4.3 million
- GAAP subscription gross margin was 84%, consistent with Q3
FY23
- Non-GAAP subscription gross margin was 85%, consistent with Q3
FY23
- GAAP operating margin increased by 9 percentage points year
over year
- Non-GAAP operating margin increased by 5 percentage points year
over year
- GAAP net loss was $16.4 million, and GAAP net loss per share
was $0.45, based on 36.3 million weighted-average shares
outstanding
- Non-GAAP net loss was $24.0 thousand, and non-GAAP net loss per
share was $0.00, based on 36.3 million weighted-average shares
outstanding
- Cash, cash equivalents, and restricted cash were $57.4 million
as of October 31, 2023
“In Q3, we exceeded guidance for key top-line metrics and
delivered record operating margin. I am confident we are focused on
the right initiatives--such as driving consumption and offering a
true freemium model--to help accelerate our path to long-term,
profitable growth,” said Josh James, founder and CEO, Domo.
“Customers continue to realize significant value from our platform,
and I’m incredibly proud of the talent and dedication of our team
in helping us deliver on our mission to put data to work for
everyone.”
Recent Highlights
We believe the following announcements and recognition
demonstrate our commitment to product innovation and customer
value:
- Domo was a leader in Nucleus Research’s 2023 Embedded Analytics
Technology Value Matrix for the third consecutive year.
- Domo and customer Regional One Health received a Nucleus
Research ROI Award for achieving a total ROI of 190% through the
adoption of Domo's data experience platform.
- Domo was ranked as an Overall Experience Leader in Dresner
Advisory Services' 2023 Small and Midsize Enterprise Business
Intelligence Market Study and was named an Overall Leader in
Dresner Advisory Services’ 2023 Industry Excellence Awards.
- Domo was named to the 2023 Constellation ShortList™ for
Marketing Analytics Solutions, its ninth placement on this
ShortList.
Business Outlook
Based on information available as of November 30, 2023, Domo is
providing the following guidance for its fourth fiscal quarter and
full year fiscal 2024:
Q4 Fiscal 2024
- Revenue is expected to be in the range of $79.0 million to
$80.0 million
- Non-GAAP net loss per share, basic and diluted, is expected to
be between $0.05 and $0.09 based on 36.8 million weighted-average
shares outstanding, basic and diluted
Full Year Fiscal 2024
- Revenue is expected to be in the range of $317.8 million to
$318.8 million, representing year-over-year growth of 2-4%.
- Non-GAAP net loss per share, basic and diluted, is expected to
be between $0.24 and $0.28 based on 36.1 million weighted-average
shares outstanding, basic and diluted
We have not reconciled guidance for non-GAAP metrics to their
most directly comparable GAAP measures because certain items that
impact these measures are not within our control or cannot be
reasonably predicted.
Earnings Call Details
Domo plans to host a conference call today to review its fiscal
2024 third quarter financial results and to discuss its financial
outlook. The call is scheduled to begin at 3:00 p.m. MT/ 5:00 p.m.
ET. A live webcast of the event will be available on the Domo
Investor Relations website at https://www.domo.com/ir. Participants
can register for the call in advance by visiting
https://conferencingportals.com/event/UamMeXVB. Instructions will
be shared on how to join the call after registering.
A replay will be available at (800) 770-2030 or (647) 362-9199
with conference ID #41576 following the completion of the
conference call until 11:59 p.m. (ET) December 14, 2023.
About Domo
Domo puts data to work for everyone so they can multiply their
impact on the business. Our cloud-native data experience platform
goes beyond traditional business intelligence and analytics, making
data visible and actionable with user-friendly dashboards and apps.
Underpinned by AI, data science and a secure data foundation that
connects with existing cloud and legacy systems, Domo helps
companies optimize critical business processes at scale and in
record time to spark the bold curiosity that powers exponential
business results.
For more information, visit www.domo.com. You can also follow
Domo on X, Facebook and LinkedIn.
Domo Disclosure Channels to Disseminate Information
Domo investors and others should note that we announce material
information to the public about our company, products and services,
and other issues through a variety of means, including Domo’s
website, press releases, SEC filings, blogs and social media, in
order to achieve broad, non-exclusionary distribution of
information to the public. We intend to use the Domo Facebook page,
the Domo LinkedIn page, the Domo blog, the @Domotalk X account and
the @JoshJames X account as a means of disclosing information about
the Company and its services and for complying with the disclosure
obligations under Regulation FD. The information we post through
these social media channels may be deemed material. Accordingly, we
encourage investors and others to monitor these social media
channels in addition to following our press releases, SEC filings
and public conference calls and webcasts. The social media channels
that we intend to use as a means of disclosing the information
described here may be updated from time to time as listed on our
investor relations webpage.
Use of Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements,
which are prepared and presented in accordance with Generally
Accepted Accounting Principles in the United States of America
(GAAP), we reference in this press release and the accompanying
tables the following non-GAAP financial measures: billings,
non-GAAP subscription gross margin, non-GAAP operating expenses,
non-GAAP operating loss, non-GAAP operating margin, non-GAAP net
loss, non-GAAP net loss per share, and adjusted free cash flow. In
computing these measures, we exclude the effects of certain items
including stock-based compensation expense, amortization of certain
intangible assets, severance of executive officers who report to
the Chief Executive Officer, and proceeds from shares issued in
connection with the employee stock purchase plan.
As it relates to adjusted free cash flow, we add back amounts
equal to the proceeds from shares issued in connection with
employee stock purchase plan to reflect the non-cash nature of
these transactions. Because no cash is exchanged in these
transactions, showing proceeds in the financing section of the
statement of cash flows as required by GAAP results in a
corresponding decrease in the operating section, which management
believes is not indicative of actual cash used in or provided by
our operations. We believe that this non-GAAP cash metric is useful
because it provides investors with the same information that
management uses to consistently evaluate, forecast and measure the
Company’s actual cash flows and its ability to achieve and maintain
positive cash flows.
We use these non-GAAP financial measures for financial and
operational decision-making and as a means to evaluate
period-to-period comparisons. Our management believes that these
non-GAAP financial measures provide meaningful supplemental
information regarding our performance and liquidity by excluding
certain expenses that may not be indicative of our ongoing core
business operating results. We believe that both management and
investors benefit from referring to these non-GAAP financial
measures in assessing our performance and when analyzing historical
performance and liquidity and planning, forecasting, and analyzing
future periods.
During the current fiscal year, we revised our definition for
non-GAAP statement of operations line items to adjust for executive
severance expenses. We have revised the prior period amounts to
conform to our current period presentation.
For a reconciliation of these non-GAAP financial measures to
GAAP measures, please see the tables captioned "Reconciliation of
Non-GAAP Financial Measures" included at the end of this
release.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 and the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include statements of our Chief Executive Officer,
statements regarding our future, expectations for RPO in the next
12 months, our financial outlook for our fourth fiscal quarter and
full fiscal year 2024, and results for future periods.
Forward-looking statements are subject to risks and uncertainties
and are based on potentially inaccurate assumptions that could
cause actual results to differ materially from those expected or
implied by the forward-looking statements. Actual results may
differ materially from the results predicted, and reported results
should not be considered as an indication of future performance.
The potential risks and uncertainties that could cause actual
results to differ from the results predicted include, among others,
those risks and uncertainties included under the caption "Risk
Factors" and elsewhere in our filings with the SEC, including,
without limitation, the Annual Report on Form 10-K filed with the
SEC on March 27, 2023 and the Quarterly Report on Form 10-Q for the
fiscal quarter ended October 31, 2023 expected to be filed with the
SEC on or about December 11, 2023. All information provided in this
release and in the attachments is as of the date hereof, and we
undertake no duty to update this information unless required by
law.
Domo is a registered trademark of Domo, Inc.
Domo, Inc.
Condensed Consolidated
Statements of Operations
(in thousands, except per
share data)
(unaudited)
Three Months Ended
Nine Months Ended
October 31,
October 31,
2022
2023
2022
2023
Revenue: Subscription
$
69,041
$
71,293
$
201,022
$
213,594
Professional services and other
9,985
8,382
27,999
25,211
Total revenue
79,026
79,675
229,021
238,805
Cost of revenue: Subscription (1)
11,342
11,523
32,721
33,588
Professional services and other (1)
7,572
7,253
22,167
22,847
Total cost of revenue
18,914
18,776
54,888
56,435
Gross profit
60,112
60,899
174,133
182,370
Operating expenses: Sales and marketing (1), (3)
41,012
40,262
131,299
124,464
Research and development (1)
24,583
19,729
73,108
63,931
General and administrative (1), (2), (3)
13,029
12,130
42,514
35,509
Total operating expenses
78,624
72,121
246,921
223,904
Loss from operations
(18,512
)
(11,222
)
(72,788
)
(41,534
)
Other expense, net (1)
(5,032
)
(4,930
)
(12,383
)
(14,549
)
Loss before income taxes
(23,544
)
(16,152
)
(85,171
)
(56,083
)
Provision for income taxes
167
261
567
801
Net loss
$
(23,711
)
$
(16,413
)
$
(85,738
)
$
(56,884
)
Net loss per share (basic and diluted)
$
(0.69
)
$
(0.45
)
$
(2.53
)
$
(1.59
)
Weighted-average number of shares (basic and diluted)
34,392
36,310
33,893
35,812
(1) Includes stock-based compensation expenses, as
follows: Cost of revenue: Subscription
$
667
$
670
$
2,176
$
1,958
Professional services and other
308
359
1,339
1,311
Sales and marketing
7,336
6,364
23,284
19,260
Research and development
5,909
4,621
19,196
14,214
General and administrative
4,807
4,174
18,319
10,642
Other expense, net
180
181
550
516
Total stock-based compensation expenses
$
19,207
$
16,369
$
64,864
$
47,901
(2) Includes amortization of certain intangible assets, as
follows: General and administrative
$
20
$
20
$
60
$
60
(3) Includes executive officer severance, as follows: Sales
and marketing
$
113
$
-
$
620
$
443
General and administrative
-
-
-
1,553
Total executive officer severance
$
113
$
-
$
620
$
1,996
Domo, Inc. Condensed Consolidated Balance Sheets
(in thousands) (unaudited) January 31,
October 31,
2023
2023
Assets Current assets: Cash, cash equivalents, and
restricted cash
$
66,500
$
57,387
Accounts receivable, net
78,958
55,208
Contract acquisition costs
15,908
15,794
Prepaid expenses and other current assets
7,447
7,881
Total current assets
168,813
136,270
Property and equipment, net
21,375
26,130
Right-of-use assets
15,255
12,333
Contract acquisition costs, noncurrent
22,299
19,601
Intangible assets, net
2,794
2,760
Goodwill
9,478
9,478
Other assets
2,102
1,647
Total assets
$
242,116
$
208,219
Liabilities and stockholders' deficit Current
liabilities: Accounts payable
$
12,120
$
10,451
Accrued expenses and other current liabilities
49,306
43,510
Lease liabilities
4,905
4,407
Current portion of deferred revenue
182,273
158,522
Total current liabilities
248,604
216,890
Lease liabilities, noncurrent
15,271
12,161
Deferred revenue, noncurrent
3,609
4,236
Other liabilities, noncurrent
12,425
13,448
Long-term debt
108,607
112,255
Total liabilities
388,516
358,990
Commitments and contingencies Stockholders' deficit:
Common stock
35
36
Additional paid-in capital
1,183,921
1,236,895
Accumulated other comprehensive loss
(322
)
(784
)
Accumulated deficit
(1,330,034
)
(1,386,918
)
Total stockholders' deficit
(146,400
)
(150,771
)
Total liabilities and stockholders' deficit
$
242,116
$
208,219
Domo, Inc. Condensed Consolidated Statements of Cash
Flows (in thousands) (unaudited) Three
Months Ended Nine Months Ended October 31,
October 31,
2022
2023
2022
2023
Cash flows from operating activities Net loss
$
(23,711
)
$
(16,413
)
$
(85,738
)
$
(56,884
)
Adjustments to reconcile net loss to net cash used in operating
activities: Depreciation and amortization
1,269
1,636
4,089
4,738
Non-cash lease expense
987
1,063
3,362
3,235
Amortization of contract acquisition costs
4,247
4,398
12,825
13,354
Stock-based compensation
19,207
16,369
64,864
47,901
Other, net
1,135
1,072
3,027
3,643
Changes in operating assets and liabilities: Accounts receivable,
net
(4,166
)
(3,022
)
10,835
23,750
Contract acquisition costs
(4,405
)
(4,016
)
(11,687
)
(10,921
)
Prepaid expenses and other assets
1,282
291
2,063
(173
)
Accounts payable
384
998
13,291
(966
)
Operating lease liabilities
(1,239
)
(1,237
)
(3,378
)
(4,054
)
Accrued and other liabilities
3,527
(608
)
(11,872
)
(3,361
)
Deferred revenue
(4,999
)
(4,856
)
(9,740
)
(23,124
)
Net cash used in operating activities
(6,482
)
(4,325
)
(8,059
)
(2,862
)
Cash flows from investing activities Purchases of
property and equipment
(1,657
)
(2,714
)
(5,073
)
(9,214
)
Purchases of intangible assets
-
-
-
(26
)
Net cash used in investing activities
(1,657
)
(2,714
)
(5,073
)
(9,240
)
Cash flows from financing activities Proceeds from
shares issued in connection with employee stock purchase plan
-
1,374
1,563
3,406
Proceeds from structured payables
6,624
-
6,624
-
Payments on structured payables
(6,624
)
-
(6,624
)
-
Proceeds from exercise of stock options
56
62
861
65
Net cash provided by financing activities
56
1,436
2,424
3,471
Effect of exchange rate changes on cash, cash equivalents, and
restricted cash
(729
)
(862
)
(1,771
)
(482
)
Net decrease in cash, cash equivalents, and restricted cash
(8,812
)
(6,465
)
(12,479
)
(9,113
)
Cash, cash equivalents, and restricted cash at beginning of period
79,894
63,852
83,561
66,500
Cash, cash equivalents, and restricted cash at end of period
$
71,082
$
57,387
$
71,082
$
57,387
Domo, Inc. Reconciliation of Non-GAAP Financial
Measures (in thousands, except per share data)
(unaudited) Three Months Ended Nine Months
Ended October 31, October 31,
2022
2023
2022
2023
Reconciliation of Subscription Gross Margin on a GAAP Basis to
Subscription Gross Margin on a Non-GAAP Basis: Revenue:
Subscription
$
69,041
$
71,293
$
201,022
$
213,594
Cost of revenue: Subscription
11,342
11,523
32,721
33,588
Subscription gross profit on a GAAP basis
57,699
59,770
168,301
180,006
Subscription gross margin on a GAAP basis
84
%
84
%
84
%
84
%
Stock-based compensation
667
670
2,176
1,958
Subscription gross profit on a non-GAAP basis
$
58,366
$
60,440
$
170,477
$
181,964
Subscription gross margin on a non-GAAP basis
85
%
85
%
85
%
85
%
Reconciliation of Total Operating Expenses on a GAAP
Basis to Total Operating Expenses on a Non-GAAP Basis: Total
operating expenses on a GAAP basis
$
78,624
$
72,121
$
246,921
$
223,904
Stock-based compensation
(18,052
)
(15,159
)
(60,799
)
(44,116
)
Amortization of certain intangible assets
(20
)
(20
)
(60
)
(60
)
Executive officer severance (1)
(113
)
-
(620
)
(1,996
)
Total operating expenses on a non-GAAP basis
$
60,439
$
56,942
$
185,442
$
177,732
Reconciliation of Operating Loss on a GAAP Basis to
Operating Income (Loss) on a Non-GAAP Basis: Operating loss on
a GAAP basis
$
(18,512
)
$
(11,222
)
$
(72,788
)
$
(41,534
)
Stock-based compensation
19,027
16,188
64,314
47,385
Amortization of certain intangible assets
20
20
60
60
Executive officer severance (1)
113
-
620
1,996
Operating income (loss) on a non-GAAP basis
$
648
$
4,986
$
(7,794
)
$
7,907
Reconciliation of Operating Margin on a GAAP Basis to
Operating Margin on a Non-GAAP Basis: Operating margin on a
GAAP basis
(23
)%
(14
)%
(32
)%
(17
)%
Stock-based compensation
24
20
28
19
Executive officer severance (1)
-
-
1
1
Operating margin on a non-GAAP basis
1
%
6
%
(3
)%
3
%
Reconciliation of Net Loss on a GAAP Basis to Net Loss on
a Non-GAAP Basis: Net loss on a GAAP basis
$
(23,711
)
$
(16,413
)
$
(85,738
)
$
(56,884
)
Stock-based compensation
19,207
16,369
64,864
47,901
Amortization of certain intangible assets
20
20
60
60
Executive officer severance (1)
113
-
620
1,996
Net (loss) income on a non-GAAP basis
$
(4,371
)
$
(24
)
$
(20,194
)
$
(6,927
)
Reconciliation of Net Loss per Share on a GAAP Basis to
Net Loss per Share on a Non-GAAP Basis: Net loss per share on a
GAAP basis
$
(0.69
)
$
(0.45
)
$
(2.53
)
$
(1.59
)
Stock-based compensation
0.56
0.45
1.91
1.34
Executive officer severance (1)
—
—
0.01
0.06
Net loss per share on a non-GAAP basis
$
(0.13
)
$
—
$
(0.61
)
$
(0.19
)
Billings: Total revenue
$
79,026
$
79,675
$
229,021
$
238,805
Add: Deferred revenue (end of period)
157,915
158,522
157,915
158,522
Deferred revenue, noncurrent (end of period)
3,100
4,236
3,100
4,236
Less: Deferred revenue (beginning of period)
(163,454
)
(164,882
)
(168,335
)
(182,273
)
Deferred revenue, noncurrent (beginning of period)
(2,560
)
(2,732
)
(2,420
)
(3,609
)
Decrease in deferred revenue (current and noncurrent)
(4,999
)
(4,856
)
(9,740
)
(23,124
)
Billings
$
74,027
$
74,819
$
219,281
$
215,681
Reconciliation of Net Cash Used in Operating Activities
to Adjusted Free Cash Flow: Net cash used in operating
activities
$
(6,482
)
$
(4,325
)
$
(8,059
)
$
(2,862
)
Proceeds from shares issued in connection with employee stock
purchase plan
-
1,374
1,563
3,406
Purchases of property and equipment
(1,657
)
(2,714
)
(5,073
)
(9,214
)
Adjusted free cash flow
$
(8,139
)
$
(5,665
)
$
(11,569
)
$
(8,670
)
(1) During the current fiscal year, we
revised our definition for non-GAAP statement of operations line
items to adjust for executive severance expenses. We have revised
the prior period amounts to conform to our current period
presentation.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231130408624/en/
Media: Cynthia Cowen PR@domo.com
Investors: Peter Lowry IR@Domo.com
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