Company Delivers Solid First Quarter Revenue
and Improved Profitability
Everbridge, Inc. (Nasdaq: EVBG), the global leader in critical
event management (CEM) and national public warning solutions, today
announced its financial results for the first quarter ended March
31, 2023. Revenue for the first quarter was up 8% year-over-year to
$108.3 million, and GAAP net loss improved to $(14.6) million from
$(19.1) million.
“The first quarter marked a solid start to the year,” said David
Wagner, Everbridge’s President and CEO. “We delivered another
steady sequential increase in ARR and solid growth in our adjusted
EBITDA. During the quarter, we also introduced an evolution of our
brand representing our commitment to delivering organizational
resilience for businesses and governments around the world. Our
execution continues to improve and we believe we are well
positioned to deliver increasing shareholder value.”
Patrick Brickley, Everbridge’s CFO, added, “Our focus on fiscal
discipline drove meaningful increases in profitability and cash
flow in the first quarter. Our healthy retention rates reflect the
value we are delivering through our platform. Based on the
strategic initiatives that we continue to execute and improve upon,
we are confident in meeting our year-end goals.”
First Quarter 2023 Financial Highlights
- Total revenue was $108.3 million, an increase of 8% compared to
$100.4 million for the first quarter of 2022.
- GAAP operating loss was $(15.4) million, compared to $(19.2)
million for the first quarter of 2022.
- Non-GAAP operating income was $10.1 million, compared to
non-GAAP operating loss of $(1.6) million for the first quarter of
2022.
- GAAP net loss was $(14.6) million, compared to GAAP net loss of
$(19.1) million for the first quarter of 2022. GAAP diluted net
loss per share was $(0.36), based on 40.3 million diluted weighted
average common shares outstanding, compared to $(0.48) for the
first quarter of 2022, based on 39.4 million diluted weighted
average common shares outstanding.
- Non-GAAP net income was $10.8 million, compared to non-GAAP net
loss of $(0.6) million in the first quarter of 2022. Non-GAAP
diluted net income per share was $0.25, based on 43.8 million
diluted weighted average common shares outstanding, compared to
non-GAAP diluted net loss per share of $(0.02) for the first
quarter of 2022, based on 39.4 million diluted weighted average
common shares outstanding.
- Adjusted EBITDA was $15.9 million, compared to $2.6 million in
the first quarter of 2022.
- Cash flow from operations was an inflow of $20.6 million,
compared to $7.7 million for the first quarter of 2022.
- Adjusted for one-time cash payments related to our 2022
Strategic Realignment program, Adjusted Free Cash Flow was an
inflow of $20.0 million for the first quarter of 2023.
Recent Business Highlights
- ARR was $388 million, up 10% year-over-year.
- Ended the first quarter with 6,500 global enterprise customers,
down 13 sequentially but up 4% year-over-year, reflecting planned
divestitures and other end-of-life products discussed during
2022.
- CEM customer count increased to 335, up 28 sequentially and 64%
year-over-year.
- Unveiled an evolution of our corporate brand and the
commemoration of our 20-year anniversary of empowering resilience.
The evolved brand represents the company’s commitment to empowering
enterprises and government organizations with the ability to
anticipate, mitigate, respond to, and recover stronger from
incidents of all kinds – physical and digital.
- Announced the completed deployment of the company’s countrywide
population alerting system in six European nations – Germany,
United Kingdom, Spain, Denmark, Norway, and Estonia, protecting a
combined population of more than 200 million residents.
- Presented unique industry research identifying only 24% of over
200 surveyed global organizations have a strong Travel Risk
Management (TRM) program in place as defined by TRM Standard ISO
31030.
- Reported that the Republic of Mauritius completed
implementation of the company’s population alerting solution to
help keep 1.3 million residents and over 1.4 million annual
tourists safe.
- Provided the Boston Athletic Association with the platform to
communicate critical event updates and safety information to
thousands of staff and volunteers during the 127th running of the
Boston Marathon.
- Recognized with a 2023 Platinum Govies Government Security
Award for its Control Center product that correlates events from
disparate safety and security systems into a common operating
picture.
Financial Outlook
Based on information available as of today, Everbridge is
issuing guidance for the second quarter and full year 2023 as
indicated below.
Full Year 2023
Guidance
Second Quarter 2023
Full Year 2023
Issued February 22,
2023
Revenue
$
110.0
to
$
110.5
$
456.0
to
$
462.0
$
456.0
to
$
462.0
Revenue growth
7
%
7
%
6
%
7
%
6
%
7
%
GAAP net loss
$
(16.8
)
$
(16.3
)
$
(47.6
)
$
(45.6
)
$
(47.6
)
$
(45.6
)
GAAP net loss per share
$
(0.41
)
$
(0.40
)
$
(1.17
)
$
(1.12
)
$
(1.17
)
$
(1.12
)
Non-GAAP net income
$
11.5
$
12.0
$
65.8
$
67.8
$
65.8
$
67.8
Non-GAAP net income per share
$
0.26
$
0.27
$
1.48
$
1.52
$
1.48
$
1.52
Adjusted EBITDA
$
16.5
$
17.2
$
84.0
$
86.0
$
84.0
$
86.0
(All figures in millions, except per share
data)
Conference Call Information
What:
Everbridge’s First Quarter 2023 Financial
Results Conference Call
When:
Tuesday, May 9, 2023
Time:
8:30 a.m. ET
Live Call:
(833) 685-0904 Domestic
(412) 317-5740 International
Replay:
(877) 344-7529 Passcode 6763646,
Domestic
(412) 317-0088 Passcode 6763646,
International
Webcast:
https://edge.media-server.com/mmc/p/6zwtn9bd (live and replay)
About Everbridge
Everbridge (Nasdaq: EVBG) empowers enterprises and government
organizations to anticipate, mitigate, respond to, and recover
stronger from critical events. In today’s unpredictable world,
resilient organizations minimize impact to people and operations,
absorb stress, and return to productivity faster when deploying
critical event management (CEM) technology. Everbridge digitizes
organizational resilience by combining intelligent automation with
the industry’s most comprehensive risk data to Keep People Safe and
Organizations Running™. For more information, visit
https://www.everbridge.com/, read the company blog, and follow on
Twitter. Everbridge… Empowering Resilience.
Key Performance Metric
Annualized Recurring Revenue (ARR) is defined as the expected
recurring revenue in the next twelve months from active customer
contracts, assuming no increases or reductions in the subscriptions
from that cohort of customers. Investors should not place undue
reliance on ARR as an indicator of future or expected results. Our
presentation of this metric may differ from similarly titled
metrics presented by other companies and therefore comparability
may be limited.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial
measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP
operating income/(loss), non-GAAP net income/(loss), non-GAAP net
income/(loss) per share, EBITDA, adjusted EBITDA, free cash flow,
adjusted free cash flow and adjusted EBITDA margin.
Non-GAAP operating income/(loss) excludes amortization of
acquired intangible assets, stock-based compensation, costs related
to the 2022 Strategic Realignment and change in fair value of
contingent consideration. Non-GAAP net income/(loss) excludes
amortization of acquired intangible assets, stock-based
compensation, costs related to the 2022 Strategic Realignment,
change in fair value of contingent consideration, accretion of
interest on convertible senior notes, gain (loss) on extinguishment
of debt, capped call modification and change in fair value and the
tax impact of such adjustments. EBITDA represents net income/(loss)
before interest income and interest expense, income tax expense and
benefit and depreciation and amortization expense. Adjusted EBITDA
represents EBITDA as further adjusted for stock-based compensation
expense, costs related to the 2022 Strategic Realignment, change in
fair value of contingent consideration and gain (loss) on
extinguishment of debt, capped call modification and change in fair
value. Free cash flow represents cash provided by (used in)
operating activities minus cash used for capital expenditures and
capitalized software development costs. Adjusted free cash flow
represents free cash flow as further adjusted for cash payments for
the 2022 Strategic Realignment.
We believe that these non-GAAP measures of financial results
provide useful information to management and investors regarding
certain financial and business trends relating to Everbridge's
financial condition and results of operations. We use these
non-GAAP measures for financial, operational and budgetary
decision-making purposes, to understand and evaluate our core
operating performance and trends, and to generate future operating
plans. We believe that these non-GAAP financial measures provide
useful information regarding past financial performance and future
prospects, and permit us to more thoroughly analyze key financial
metrics used to make operational decisions. We believe that the use
of these non-GAAP financial measures provides an additional tool
for investors to use in evaluating ongoing operating results and
trends and in comparing our financial measures with other software
companies, many of which present similar non-GAAP financial
measures to investors.
We do not consider these non-GAAP measures in isolation or as an
alternative to financial measures determined in accordance with
GAAP. The principal limitation of these non-GAAP financial measures
is that they exclude significant expenses and income that are
required by GAAP to be recorded in the Company's financial
statements. In addition, they are subject to inherent limitations
as they reflect the exercise of judgment by management about which
expenses and income are excluded or included in determining these
non-GAAP financial measures. In order to compensate for these
limitations, management presents non-GAAP financial measures in
connection with GAAP results. We urge investors to review the
reconciliation of our non-GAAP financial measures to the comparable
GAAP financial measures, which are included in this press release,
and not to rely on any single financial measure to evaluate our
business.
Cautionary Language Concerning Forward-Looking
Statements
This press release contains “forward-looking statements” within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995, including but not limited
to, statements regarding the anticipated opportunity and trends for
growth in our critical communications and enterprise safety
applications and our overall business, our market opportunity, our
expectations regarding sales of our products, our goal to maintain
market leadership and extend the markets in which we compete for
customers, and anticipated impact on financial results for the
second quarter of 2023 and the full fiscal year 2023. These
forward-looking statements are made as of the date of this press
release and were based on current expectations, estimates,
forecasts and projections as well as the beliefs and assumptions of
management. Words such as “expect,” “anticipate,” “should,”
“believe,” “target,” “project,” “goals,” “estimate,” “potential,”
“predict,” “may,” “will,” “could,” “intend,” variations of these
terms or the negative of these terms and similar expressions are
intended to identify these forward-looking statements.
Forward-looking statements are subject to a number of risks and
uncertainties, many of which involve factors or circumstances that
are beyond our control. Our actual results could differ materially
from those stated or implied in forward-looking statements due to a
number of factors, including but not limited to: the ability of our
products and services to perform as intended and meet our
customers’ expectations; our ability to successfully integrate
businesses and assets that we may acquire; our ability to attract
new customers and retain and increase sales to existing customers;
our ability to increase sales of our Mass Notification application
and/or ability to increase sales of our other applications;
developments in the market for targeted and contextually relevant
critical communications or the associated regulatory environment;
our estimates of market opportunity and forecasts of market growth
may prove to be inaccurate; we have not been profitable on a
consistent basis historically and may not achieve or maintain
profitability in the future; the lengthy and unpredictable sales
cycles for new customers; nature of our business exposes us to
inherent liability risks; our ability to attract, integrate and
retain qualified personnel; our ability to maintain successful
relationships with our channel partners and technology partners;
our ability to manage our growth effectively; our ability to
respond to competitive pressures; potential liability related to
privacy and security of personally identifiable information; our
ability to protect our intellectual property rights, and the other
risks detailed in our risk factors discussed in filings with the
U.S. Securities and Exchange Commission (“SEC”), including but not
limited to, our Annual Report on Form 10-K for the year ended
December 31, 2022 filed with the SEC on February 24, 2023 and other
subsequent filings with the SEC. The forward-looking statements
included in this press release represent our views as of the date
of this press release. We undertake no intention or obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. These
forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
All Everbridge products are trademarks of Everbridge, Inc. in
the USA and other countries. All other product or company names
mentioned are the property of their respective owners.
Consolidated Balance Sheets
(in thousands)
(unaudited)
March 31,
December 31,
2023
2022
Current assets:
Cash and cash equivalents
$
220,880
$
198,725
Restricted cash
2,063
2,046
Accounts receivable, net
107,054
119,986
Prepaid expenses
15,789
13,133
Assets held for sale
—
6,485
Deferred costs and other current
assets
34,139
31,866
Total current assets
379,925
372,241
Property and equipment, net
8,388
8,993
Capitalized software development costs,
net
28,192
27,370
Goodwill
510,962
508,781
Intangible assets, net
156,761
166,177
Restricted cash
815
823
Prepaid expenses
1,442
1,709
Deferred costs and other assets
39,826
39,570
Total assets
$
1,126,311
$
1,125,664
Current liabilities:
Accounts payable
$
9,289
$
10,854
Accrued payroll and employee related
liabilities
29,523
31,175
Accrued expenses
12,778
13,566
Deferred revenue
238,135
233,106
Liabilities held for sale
—
2,062
Other current liabilities
9,640
10,644
Total current liabilities
299,365
301,407
Long-term liabilities:
Deferred revenue, noncurrent
8,684
9,278
Convertible senior notes
501,013
500,298
Deferred tax liabilities
5,714
6,236
Other long-term liabilities
18,772
19,334
Total liabilities
833,548
836,553
Stockholders' equity:
Common stock
40
40
Additional paid-in capital
737,017
721,143
Accumulated deficit
(416,772
)
(402,124
)
Accumulated other comprehensive loss
(27,522
)
(29,948
)
Total stockholders' equity
292,763
289,111
Total liabilities and stockholders'
equity
$
1,126,311
$
1,125,664
Consolidated Statements of Operations
and Comprehensive Loss
(in thousands, except share and per share
data)
(unaudited)
Three Months Ended
March 31,
2023
2022
Revenue
$
108,268
$
100,375
Cost of revenue
31,981
31,857
Gross profit
76,287
68,518
Gross margin
70.46
%
68.26
%
Operating expenses:
Sales and marketing
42,188
41,816
Research and development
25,004
23,559
General and administrative
24,466
22,336
Restructuring
21
—
Total operating expenses
91,679
87,711
Operating loss
(15,392
)
(19,193
)
Other income (expense), net:
Interest and investment income
1,737
62
Interest expense
(769
)
(1,300
)
Other income, net
618
280
Total other income (expense), net
1,586
(958
)
Loss before income taxes
(13,806
)
(20,151
)
(Provision for) benefit from income
taxes
(842
)
1,078
Net loss
$
(14,648
)
$
(19,073
)
Net loss per share attributable to common
stockholders:
Basic
$
(0.36
)
$
(0.48
)
Diluted
$
(0.36
)
$
(0.48
)
Weighted-average common shares
outstanding:
Basic
40,274,069
39,429,686
Diluted
40,274,069
39,429,686
Other comprehensive loss:
Foreign currency translation
adjustment
2,426
(5,360
)
Total comprehensive loss
$
(12,222
)
$
(24,433
)
Stock-based compensation expense included
in the above:
(in thousands)
Three Months Ended
March 31,
2023
2022
Cost of revenue
$
1,655
$
829
Sales and marketing
4,747
1,344
Research and development
3,726
1,577
General and administrative
3,321
2,334
Total stock-based compensation
$
13,449
$
6,084
Consolidated Statements of Cash
Flows
(in thousands)
(unaudited)
Three Months Ended
March 31,
2023
2022
Cash flows from operating activities:
Net loss
$
(14,648
)
$
(19,073
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization
14,774
15,434
Amortization of deferred costs
4,514
3,963
Deferred income taxes
(501
)
(6,553
)
Accretion of interest on convertible
senior notes
715
1,158
Provision for credit losses and sales
reserve
1,635
213
Stock-based compensation
13,449
6,084
Other non-cash adjustments
(352
)
(52
)
Changes in operating assets and
liabilities:
Accounts receivable
11,994
11,420
Prepaid expenses
(2,465
)
(2,447
)
Deferred costs
(5,909
)
(6,221
)
Other assets
(597
)
1,819
Accounts payable
(1,732
)
(6,124
)
Accrued payroll and employee related
liabilities
(1,652
)
(1,862
)
Accrued expenses
(797
)
3,246
Deferred revenue
3,589
8,036
Other liabilities
(1,442
)
(1,339
)
Net cash provided by operating
activities
20,575
7,702
Cash flows from investing activities:
Capital expenditures
(575
)
(1,847
)
Proceeds from sale of assets
4,289
—
Payment for acquisition of business, net
of acquired cash
—
(47
)
Additions to capitalized software
development costs
(4,112
)
(4,330
)
Net cash used in investing activities
(398
)
(6,224
)
Cash flows from financing activities:
Payments associated with shares withheld
to settle employee tax withholding liability
(1,866
)
(571
)
Proceeds from employee stock purchase
plan
2,546
1,702
Proceeds from stock option exercises
1,263
17
Other
(19
)
(19
)
Net cash provided by financing
activities
1,924
1,129
Effect of exchange rates on cash, cash
equivalents and restricted cash
63
(356
)
Net increase in cash, cash equivalents and
restricted cash
22,164
2,251
Cash, cash equivalents and restricted
cash—beginning of period
201,594
492,758
Cash, cash equivalents and restricted
cash—end of period
$
223,758
$
495,009
Reconciliation of GAAP measures to
non-GAAP measures
(unaudited)
The following table reconciles our GAAP
gross profit to non-GAAP gross profit (in thousands):
Three Months Ended
March 31,
2023
2022
Gross profit
$
76,287
$
68,518
Amortization of acquired intangibles
2,385
3,151
Stock-based compensation
1,655
829
2022 Strategic Realignment
341
—
Non-GAAP gross profit
$
80,668
$
72,498
The following table reconciles our GAAP
gross margin to non-GAAP gross margin(1):
Three Months Ended
March 31,
2023
2022
Gross margin
70.5
%
68.3
%
Amortization of acquired intangibles
margin
2.2
%
3.1
%
Stock-based compensation margin
1.5
%
0.8
%
2022 Strategic Realignment margin
0.3
%
—
Non-GAAP gross margin
74.5
%
72.2
%
(1) Columns may not add up due to
rounding.
The following table reconciles our GAAP
operating loss to non-GAAP operating income (loss) (in
thousands):
Three Months Ended
March 31,
2023
2022
Operating loss
$
(15,392
)
$
(19,193
)
Amortization of acquired intangibles
9,648
11,538
Stock-based compensation
13,449
6,084
2022 Strategic Realignment
2,405
—
Change in fair value of contingent
consideration
—
(52
)
Non-GAAP operating income (loss)
$
10,110
$
(1,623
)
The following table reconciles our GAAP
net loss to non-GAAP net income (loss) (in thousands):
Three Months Ended
March 31,
2023
2022
Net loss
$
(14,648
)
$
(19,073
)
Amortization of acquired intangibles
9,648
11,538
Stock-based compensation
13,449
6,084
2022 Strategic Realignment
2,404
—
Change in fair value of contingent
consideration
—
(52
)
Accretion of interest on convertible
senior notes
715
1,158
Income tax adjustments
(737
)
(250
)
Non-GAAP net income (loss)
$
10,831
$
(595
)
Reconciliation of GAAP measures to
non-GAAP measures (Continued)
(unaudited)
The following table presents our GAAP net
loss per share and non-GAAP net income (loss) per share:
Three Months Ended
March 31,
2023
2022
Net loss per share:
Basic
$
(0.36
)
$
(0.48
)
Diluted
$
(0.36
)
$
(0.48
)
Weighted-average common shares
outstanding:
Basic
40,274,069
39,429,686
Diluted
40,274,069
39,429,686
Non-GAAP net income (loss) per share:
Basic
$
0.27
$
(0.02
)
Diluted
$
0.25
$
(0.02
)
Weighted-average common shares
outstanding:
Basic
40,274,069
39,429,686
Diluted
43,767,021
39,429,686
The following tables reconcile our net loss to EBITDA and
adjusted EBITDA, net cash provided by operating activities to free
cash flow and adjusted free cash flow and net loss margin to EBITDA
and adjusted EBITDA margin (dollars in thousands):
Three Months Ended
March 31,
2023
2022
Net loss
$
(14,648
)
$
(19,073
)
Interest and investment expense, net
(968
)
1,238
Provision for (benefit from) income
taxes
842
(1,078
)
Depreciation and amortization
14,774
15,434
EBITDA
—
(3,479
)
Stock-based compensation
13,449
6,084
2022 Strategic Realignment
2,404
—
Change in fair value of contingent
consideration
—
(52
)
Adjusted EBITDA
$
15,853
$
2,553
Net cash provided by operating
activities
$
20,575
$
7,702
Capital expenditures
(575
)
(1,847
)
Capitalized software development costs
(4,112
)
(4,330
)
Free cash flow
15,888
1,525
Cash payments for 2022 Strategic
Realignment
4,121
—
Adjusted free cash flow
$
20,009
$
1,525
Net loss margin
(13.5
)%
(19.0
)%
Interest and investment expense, net
margin
(0.9
)%
1.2
%
Provision for (benefit from) income taxes
margin
0.8
%
(1.1
)%
Depreciation and amortization margin
13.6
%
15.4
%
EBITDA margin
—
(3.5
)%
Stock-based compensation margin
12.4
%
6.1
%
2022 Strategic Realignment margin
2.2
%
—
Change in fair value of contingent
consideration margin
—
(0.1
)%
Adjusted EBITDA margin
14.6
%
2.5
%
Remaining Performance Obligations as of
March 31, 2023
(in millions)
Remaining Performance
Obligations
Remaining Performance
Obligations Next Twelve Months
Subscription and other contracts
$
485
$
298
Professional services contracts
10
10
Financial Outlook
(in millions, except share and per share
data)
Year Ended
Three Months Ended
Year Ended
December 31, 2023
June 30, 2023
December 31, 2023
Issued February 22,
2023
Low End
High End
Low End
High End
Low End
High End
Net loss
$
(16.8
)
$
(16.3
)
$
(47.6
)
$
(45.6
)
$
(47.6
)
$
(45.6
)
Amortization of acquired intangibles
9.6
9.6
38.2
38.2
38.2
38.2
Accretion of interest on convertible
senior notes
0.7
0.7
3.7
3.7
3.7
3.7
2022 Strategic Realignment
4.0
4.0
13.0
13.0
13.0
13.0
Stock-based compensation
14.0
14.0
58.5
58.5
58.5
58.5
Non-GAAP net income
$
11.5
$
12.0
$
65.8
$
67.8
$
65.8
$
67.8
Weighted average common shares
outstanding:
Basic
40,600,000
40,600,000
40,800,000
40,800,000
40,700,000
40,700,000
Diluted
44,000,000
44,000,000
44,500,000
44,500,000
44,500,000
44,500,000
Net loss per share
$
(0.41
)
$
(0.40
)
$
(1.17
)
$
(1.12
)
$
(1.17
)
$
(1.12
)
Non-GAAP net income per share
$
0.26
$
0.27
$
1.48
$
1.52
$
1.48
$
1.52
Net loss
$
(16.8
)
$
(16.3
)
$
(47.6
)
$
(45.6
)
$
(47.6
)
$
(45.6
)
Interest expense, net
0.2
0.2
1.0
1.0
1.0
1.0
Income taxes, net
0.1
0.1
0.2
0.2
0.2
0.2
Depreciation and amortization
15.0
15.2
58.9
58.9
58.9
58.9
EBITDA
(1.5
)
(0.8
)
12.5
14.5
12.5
14.5
2022 Strategic Realignment
4.0
4.0
13.0
13.0
13.0
13.0
Stock-based compensation
14.0
14.0
58.5
58.5
58.5
58.5
Adjusted EBITDA
$
16.5
$
17.2
$
84.0
$
86.0
$
84.0
$
86.0
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230509005413/en/
Investors: Nandan Amladi Investor Relations
nandan.amladi@everbridge.com 617-665-7197 Media: Jeff Young
Media Relations jeff.young@everbridge.com 781-859-4116
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