AvePoint Announces Third Quarter 2022 Financial Results

11/10/2022

Third quarter SaaS revenue of $30.0 million, representing 34% year-over-year growth, 45% adjusted for constant currency
Third quarter total revenue of $62.7 million, representing 16% year-over-year growth, 26% adjusted for constant currency
Total ARR of $191.7 million, representing 30% year-over-year growth, 34% adjusted for FX impact

JERSEY CITY, N.J., Nov. 10, 2022 (GLOBE NEWSWIRE) -- AvePoint (NASDAQ: AVPT), the most advanced SaaS and data management platform provider, today announced financial results for the third quarter ended September 30, 2022. 

“Q3 was another strong quarter for AvePoint despite the uncertain macroeconomic environment, highlighted by 34% ARR growth and 26% revenue growth, both adjusted for the impact of FX,” said Dr. Tianyi Jiang (TJ), CEO and Co-Founder of AvePoint. “Our strong topline performance reflects the ongoing need of companies around the world to secure collaboration data, sustain connections between people and ensure business continuity. At the same time, we continue to thoughtfully invest in a number of strategic growth initiatives while emphasizing robust expense controls across the company. We are excited for a strong close to 2022 and remain well positioned to capture the enormous market opportunity ahead of us.”

Third Quarter 2022 Financial Highlights

  • Revenue: Total revenue for the third quarter of 2022 was $62.7 million, up 16% from the third quarter of 2021 and up 26% year over year on a constant currency basis. Within total revenue, SaaS revenue was $30.0 million, up 34% from the third quarter of 2021 and up 45% year over year on a constant currency basis.

  • Gross Profit: Gross profit for the third quarter of 2022 was $45.9 million, compared to $38.7 million for the third quarter of 2021. Gross margin for the third quarter of 2022 was 73.2%, compared to 71.8% for the third quarter of 2021. Non-GAAP gross profit for the third quarter of 2022 was $46.6 million, compared to $41.1 million for the third quarter of 2021. Non-GAAP gross margin was 74.2% for the third quarter of 2022, compared to 76.3% for the third quarter of 2021.

  • Operating Income/(Loss): GAAP operating loss for the third quarter of 2022 was $(7.4) million, compared to $(28.7) million for the third quarter of 2021. Non-GAAP operating income for the third quarter of 2022 was $2.2 million, compared to $4.0 million for the third quarter of 2021.

  • Cash and short-term investments: $219.8 million as of September 30, 2022.

Third Quarter 2022 Key Performance Indicators and Business Highlights

  • ARR as of the end of third quarter was $191.7 million, up 30% year-over-year. Adjusted for FX, ARR grew 34%.

  • Dollar-based net retention rate was 106% and was 108% adjusted for FX.

  • The acquisitions of tyGraph, an award-winning platform that allows organizations to organize, measure, and analyze human interactions to accelerate success in the digital workplace, and Essential, a South Korea-based software solutions provider that will advance the Company’s ability to enable large organizations in the country to accomplish their digital transformation goals were both completed.

  • A new research and development hub in Singapore, which will serve as the Company’s international headquarters and foster local talent to support the growing global demand for B2B SaaS solutions, was announced.

  • Three rigorous audits (ISO 27001:2013 and 27017:2015 frameworks and CSA STAR Level 2), which reflect the Company’s prioritization of security and privacy and its commitment to help all organizations safely manage their digital collaboration data were completed.

  • Through September 30, 2022, the Company repurchased approximately 4 million shares under the share repurchase program at a cost of approximately $19.6 million.

Financial Outlook

For the fourth quarter of 2022, the Company expects:

  • Total revenues of $63 million to $65 million, or 19% year-over-year growth, 22% adjusted for constant currency.
  • Non-GAAP operating income of $1.5 million to $3.5 million.

For the full year 2022, the Company now expects:

  • Total revenues of $231.7 million to $233.7 million, or 21% year-over-year growth, 28% adjusted for constant currency.
  • Non-GAAP operating loss of $(3.2) million to $(1.2) million.
  • Total ARR of $202 million to $206 million, or 28% year-over-year growth, 32% adjusted for the impact of FX.

Quarterly Conference Call

AvePoint will host a conference call today, November 10, 2022, to review its third quarter 2022 financial results and to discuss its financial outlook. The call is scheduled to begin at 4:30pm ET. You may access the call and register with a live operator by dialing 1 (844) 826-3035 for US participants and 1 (412) 317-5195 for outside the US. The conference ID for the call is 5693960. Investors can also join by webcast by visiting https://ir.avepoint.com/events. The webcast will be available live, and a replay will be available following the completion of the live broadcast for approximately 90 days.

About AvePoint

Collaborate with confidence. AvePoint provides the most advanced platform for SaaS and data management to optimize SaaS operations and secure collaboration. More than 9 million cloud users rely on our solutions. Our SaaS solutions are also available to managed service providers via more than 100 cloud marketplaces, so they can better support and manage their small and mid-sized business customers. Founded in 2001, AvePoint is a five-time Global Microsoft Partner of the Year and headquartered in Jersey City, New Jersey. For more information, visit www.avepoint.com

Non-GAAP Financial Measures

To supplement AvePoint’s consolidated financial statements presented in accordance with GAAP, the company uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (including percentage of revenue figures), non-GAAP operating income and non-GAAP operating margin. In order for AvePoint’s investors to be better able to compare its current results with those of previous periods, the company has included a reconciliation of GAAP to non-GAAP financial measures at the end of this press release. These reconciliations adjust the related GAAP financial measures to exclude stock-based compensation expense. AvePoint believes the presentation of its non-GAAP financial measures enhances the user’s overall understanding of its historical financial performance. The presentation of AvePoint’s non-GAAP financial measures is not meant to be considered in isolation or as a substitute for its financial results prepared in accordance with GAAP, and AvePoint’s non-GAAP measures may be different from non-GAAP measures used by other companies.

Disclosure Information

AvePoint uses the https://ir.avepoint.com/ website as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995 and other federal securities laws including statements regarding the future performance of and market opportunities for AvePoint. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: changes in the competitive and regulated industries in which AvePoint operates, variations in operating performance across competitors, changes in laws and regulations affecting AvePoint’s business and changes in AvePoint’s ability to implement business plans, forecasts, and ability to identify and realize additional opportunities, and the risk of downturns in the market and the technology industry. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of AvePoint’s most recent Quarterly Report on Form 10-Q and its registration statement on Form S-1 and related prospectus and prospectus supplements filed with the SEC. Copies of these and other documents filed by AvePoint from time to time are available on the SEC's website, www.sec.gov. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and AvePoint does not assume any obligation and does not intend to update or revise these forward-looking statements after the date of this release, whether as a result of new information, future events, or otherwise, except as required by law. AvePoint does not give any assurance that it will achieve its expectations.

Investor Contact

AvePoint
Jamie Arestia
ir@avepoint.com
(551) 220-5654

Media Contact

AvePoint
Nicole Caci
pr@avepoint.com  
(201) 201-8143

 
AvePoint, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
             
    Three Months Ended     Nine Months Ended  
    September 30,     September 30,  
    2022     2021     2022     2021  
Revenue:                                
SaaS   $ 29,959     $ 22,410     $ 84,131     $ 61,255  
Term license and support     18,288       17,477       42,501       37,292  
Services     10,458       8,143       29,231       21,361  
Maintenance     3,754       5,293       12,262       16,160  
Perpetual license     280       604       606       2,003  
Total revenue     62,739       53,927       168,731       138,071  
Cost of revenue:                                
SaaS     7,011       4,866       18,651       13,870  
Term license and support     515       211       1,573       714  
Services     9,113       9,435       25,922       21,528  
Maintenance     189       710       739       1,608  
Total cost of revenue     16,828       15,222       46,885       37,720  
Gross profit     45,911       38,705       121,846       100,351  
Operating expenses:                                
Sales and marketing     27,201       25,186       81,429       73,488  
General and administrative     16,365       22,230       48,229       44,186  
Research and development     8,953       19,648       23,247       27,633  
Depreciation and amortization     819       326       1,959       863  
Total operating expenses     53,338       67,390       154,864       146,170  
Loss from operations     (7,427 )     (28,685 )     (33,018 )     (45,819 )
Gain on earn-out and warrant liabilities     913       13,650       6,848       13,650  
Interest income, net     16       56       50       80  
Other income (expense), net     48       (299 )     (822 )     (300 )
Loss before income taxes     (6,450 )     (15,278 )     (26,942 )     (32,389 )
Income tax expense (benefit)     336       (5,521 )     99       (6,633 )
Net loss   $ (6,786 )   $ (9,757 )   $ (27,041 )   $ (25,756 )
Net income attributable to and accretion of redeemable noncontrolling interest     (626 )     (517 )     (1,870 )     (1,413 )
Net loss attributable to AvePoint, Inc.   $ (7,412 )   $ (10,274 )   $ (28,911 )   $ (27,169 )
Deemed dividends on preferred stock           608             (32,928 )
Net loss available to common shareholders   $ (7,412 )   $ (9,666 )   $ (28,911 )   $ (60,097 )
Basic and diluted loss per share   $ (0.04 )   $ (0.05 )   $ (0.16 )   $ (0.47 )
Basic and diluted shares used in computing loss per share     180,732       176,621       179,563       126,738  
                                 

 

 
AvePoint, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except par value)
(Unaudited)
             
    September 30,     December 31,  
    2022     2021  
Assets                
Current assets:                
Cash and cash equivalents   $ 217,781     $ 268,217  
Short-term investments     2,003       2,411  
Accounts receivable, net of allowance of $1,808 and $838 at September 30, 2022 and December 31, 2021, respectively     56,777       55,067  
Prepaid expenses and other current assets     9,370       8,461  
Total current assets     285,931       334,156  
Property and equipment, net     5,610       3,922  
Goodwill     18,186        
Other intangible assets, net     11,260        
Operating lease right-of-use assets     16,913        
Deferred contract costs     42,364       38,926  
Other assets     14,577       11,734  
Total assets   $ 394,841     $ 388,738  
Liabilities, mezzanine equity, and stockholders’ equity                
Current liabilities:                
Accounts payable   $ 2,017     $ 1,824  
Accrued expenses and other liabilities     39,134       35,062  
Current portion of deferred revenue     78,034       74,294  
Total current liabilities     119,185       111,180  
Long-term operating lease liabilities     12,459        
Long-term portion of deferred revenue     7,997       8,038  
Earn-out shares liabilities     4,074       10,012  
Other non-current liabilities     5,730       3,943  
Total liabilities     149,445       133,173  
Commitments and contingencies                
Mezzanine equity                
Redeemable noncontrolling interest     12,684       5,210  
Total mezzanine equity     12,684       5,210  
Stockholders’ equity                
Common stock, $0.0001 par value; 1,000,000 shares authorized, 184,455 and 181,822 shares issued and outstanding, at September 30, 2022 and December 31, 2021, respectively     19       18  
Additional paid-in capital     655,968       625,056  
Treasury stock     (21,293 )     (1,739 )
Accumulated other comprehensive income     2,226       2,317  
Accumulated deficit     (404,208 )     (375,297 )
Total stockholders’ equity     232,712       250,355  
Total liabilities, mezzanine equity, and stockholders’ equity   $ 394,841     $ 388,738  
                 

 

 
AvePoint, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
       
    Nine Months Ended  
    September 30,  
    2022     2021  
Operating activities                
Net loss   $ (27,041 )   $ (25,756 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Depreciation and amortization     2,255       863  
Operating lease right-of-use assets expense     4,602        
Foreign currency remeasurement loss (gain)     3,026       (161 )
Provision for doubtful accounts     1,058       (880 )
Stock-based compensation     28,287       50,475  
Gain on disposal of property and equipment     (18 )     (15 )
Deferred income taxes     (154 )     (1,008 )
Change in value of earn-out and warrant liabilities     (6,754 )     (13,650 )
Changes in operating assets and liabilities:                
Accounts receivable and long-term unbilled receivables     (9,931 )     (7,002 )
Prepaid expenses and other current assets     (1,486 )     (10,775 )
Deferred contract costs and other assets     (5,166 )     (3,269 )
Accounts payable, accrued expenses and other liabilities     (4,227 )     1,836  
Deferred revenue     8,656       5,377  
Net cash used in operating activities     (6,893 )     (3,965 )
Investing activities                
Maturities of investments     180,837        
Purchases of investments     (180,495 )     (638 )
Net assets acquired from business combinations and asset acquisitions, net of cash acquired     (18,574 )      
Capitalization of internal use software     (1,165 )      
Purchase of property and equipment     (3,420 )     (1,445 )
Net cash used in investing activities     (22,817 )     (2,083 )
Financing activities                
Proceeds from recapitalization of Apex shares           441,573  
Redemption of redeemable convertible preferred stock           (130,925 )
Redemption of Legacy AvePoint common stock           (106,169 )
Payments of transaction fees by Legacy AvePoint           (2,998 )
Purchase of common stock     (19,554 )     (1,631 )
Payment of net cash settlement for management options           (7,530 )
Proceeds from stock option exercises     1,817       4,555  
Proceeds from sale of common shares of subsidiary           753  
Repayments of finance leases     (23 )     (20 )
Net cash (used in) provided by financing activities     (17,760 )     197,608  
Effect of exchange rates on cash     (2,966 )     32  
Net (decrease) increase in cash and cash equivalents     (50,436 )     191,592  
Cash and cash equivalents at beginning of period     268,217       69,112  
Cash and cash equivalents at end of period   $ 217,781     $ 260,704  
Supplemental disclosures of cash flow information                
Income taxes paid   $ 421     $ 2,823  
Noncash acquisition   $ 5,635     $  
                 

 

 
AvePoint, Inc. and Subsidiaries
Non-GAAP Reconciliations
(In thousands)
(Unaudited)
             
    Three Months Ended     Nine Months Ended  
    September 30,     September 30,  
    2022     2021     2022     2021  
Non-GAAP operating income                                
GAAP operating loss   $ (7,427 )   $ (28,685 )   $ (33,018 )   $ (45,819 )
Stock-based compensation expense     9,609       32,676       28,287       50,475  
Non-GAAP operating income (loss)   $ 2,182     $ 3,991     $ (4,731 )   $ 4,656  
Non-GAAP operating margin     3.5 %     7.4 %     -2.8 %     3.4 %
                                 
                                 
                                 
Non-GAAP gross profit                                
GAAP gross profit   $ 45,911     $ 38,705     $ 121,846     $ 100,351  
Stock-based compensation expense     667       2,428       1,948       2,790  
Non-GAAP gross profit   $ 46,578     $ 41,133     $ 123,794     $ 103,141  
Non-GAAP gross margin     74.2 %     76.3 %     73.4 %     74.7 %
                                 
Non-GAAP sales and marketing                                
GAAP sales and marketing   $ 27,201     $ 25,186     $ 81,429     $ 73,488  
Stock-based compensation expense     (2,847 )     (2,171 )     (8,705 )     (13,073 )
Non-GAAP sales and marketing   $ 24,354     $ 23,015     $ 72,724     $ 60,415  
Non-GAAP sales and marketing as a % of revenue     38.8 %     42.7 %     43.1 %     43.8 %
                                 
Non-GAAP general and administrative                                
GAAP general and administrative   $ 16,365     $ 22,230     $ 48,229     $ 44,186  
Stock-based compensation expense     (5,060 )     (13,020 )     (14,825 )     (19,375 )
Non-GAAP general and administrative   $ 11,305     $ 9,210     $ 33,404     $ 24,811  
Non-GAAP general and administrative as a % of revenue     18.0 %     17.1 %     19.8 %     18.0 %
                                 
Non-GAAP research and development                                
GAAP research and development   $ 8,953     $ 19,648     $ 23,247     $ 27,633  
Stock-based compensation expense     (1,035 )     (15,057 )     (2,809 )     (15,237 )
Non-GAAP research and development   $ 7,918     $ 4,591     $ 20,438     $ 12,396  
Non-GAAP research and development as a % of revenue     12.6 %     8.5 %     12.1 %     9.0 %
                                 

 


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Source: AvePoint, Inc.