Revenue growth accelerated to 15% in 2024 from
13% in 2023
First full year of positive non-GAAP operating
profit and free cash flow
Similarweb Ltd. (NYSE: SMWB) ("Similarweb" or the "Company"), a
leading digital data and analytics company powering critical
business decisions, today announced financial results for its
fourth quarter ended December 31, 2024. The Company published a
letter to shareholders from management discussing these results,
which can be accessed at the link:
https://ir.similarweb.com/financials/quarterly-results, located on
the Company's investor relations website.
“We finished the year with 15% revenue growth, an acceleration
relative to the 13% growth in 2023. Our focus on disciplined
execution has resulted in our first full year of non-GAAP operating
profit and free cash flow, demonstrating that we can successfully
accelerate growth while generating profit,” stated Or Offer,
Co-Founder and CEO of Similarweb. “The AI revolution presents a
significant opportunity for Similarweb as a leading global provider
of digital data. In 2024, customers began to train LLMs with our
data and we are engaging extensively with brands that are keen to
leverage our unique data to understand the evolving digital world.
To capitalize on the opportunity, we have decided to increase our
investment in sales and R&D for 2025.” Offer concluded, “We
believe we are just beginning to tap into the vast potential of our
data and the addressable markets we serve.”
Fourth Quarter 2024 Financial
Highlights
- Total revenue was $65.6 million, an increase of 16% compared to
$56.8 million for the fourth quarter of 2023.
- GAAP operating loss was $(3.6) million or (5)% of revenue,
compared to $(1.1) million or (2)% of revenue for the fourth
quarter of 2023.
- GAAP net loss per share was $(0.07), compared to $(0.04) for
the fourth quarter of 2023.
- Non-GAAP operating profit was $2.6 million or 4% of revenue,
compared to $4.7 million or 8% of revenue for the fourth quarter of
2023.
- Non-GAAP basic and diluted operating profit per share was $0.03
and $0.03, respectively, compared to $0.06 and $0.06, respectively,
for the fourth quarter of 2023.
- Cash and cash equivalents totalled $63.9 million as of December
31, 2024, compared to $71.7 million as of December 31, 2023.
- Net cash provided by operating activities was $3.4 million,
compared to $3.7 million for the fourth quarter of 2023.
- Free cash flow was $2.7 million, compared to $3.5 million for
the fourth quarter of 2023.
- Normalized free cash flow was $2.7 million, compared to $3.5
million for the fourth quarter of 2023.
Fiscal Year 2024 Financial
Highlights
- Total revenue was $249.9 million, an increase of 15% compared
to $218.0 million for fiscal year 2023.
- GAAP operating loss was $(9.7) million or (4)% of revenue,
compared to $(28.8) million or (13)% of revenue for fiscal year
2023.
- GAAP net loss per share was $(0.14), compared to $(0.38) for
fiscal year 2023.
- Non-GAAP operating profit was $15.0 million or 6% of revenue,
compared to non-GAAP operating loss of $(4.8) million or (2)% of
revenue for fiscal year 2023.
- Non-GAAP basic and diluted operating profit per share was 0.19
and 0.17 respectively, compared to non-GAAP basic and diluted
operating loss per share of $(0.06) for fiscal year 2023.
- Free cash flow was $27.4 million, compared to $(5.4) million
for fiscal year 2023.
- Normalized free cash flow was $27.7 million, compared to $(4.4)
million for fiscal year 2023.
Recent Business
Highlights
- Grew number of customers to 5,534 as of December 31, 2024, an
increase of 17% compared to December 31, 2023.
- Grew number of customers with ARR of $100,000 or more to 405,
an increase of 11% compared to December 31, 2023.
- Customers with ARR of $100,000 or more contributed 61% of the
total ARR as of December 31, 2024, increased from 57% as of
December 31, 2023.
- Dollar-based net retention rate, or NRR, for customers with ARR
of $100,000 or more was 112% in the fourth quarter of 2024,
increased from 107% in the fourth quarter of 2023.
- Overall NRR was 101% in the fourth quarter of 2024, increased
from 98% in the fourth quarter of 2023.
- 49% of our overall ARR is contracted under multi-year
subscriptions as of December 31, 2024, increased from 42% as of
December 31, 2023.
- Remaining performance obligations, or RPO, increased 26%
year-over-year, to $246.0 million as of December 31, 2024, as
compared to $195.2 million as of December 31, 2023.
Financial Outlook
“The acceleration in annual growth was supported by growth in
customers of all sizes and improving retention rates,” stated Jason
Schwartz, Chief Financial Officer of Similarweb. “We achieved our
first full year of non-GAAP operating profitability and positive
free cash flow due to our continued focus on disciplined
execution.” He further noted, “We continue to make significant
strides towards our long-term profit and free cash flow
targets.”
- FY 2025 Guidance
- Total revenue estimated between $285.0 million and $288.0
million, representing approximately 15% growth year over year at
the mid-point of the range.
- Non-GAAP operating profit estimated between $1.0 million and
$4.0 million.
- Q1 2025 Guidance
- Total revenue estimated between $66.0 million and $66.5
million.
- Non-GAAP operating loss estimated between $(1.5) million and
$(1.0) million.
The Company’s first quarter and full year 2025 financial outlook
is based upon a number of assumptions that are subject to change
and many of which are outside the Company’s control. Actual results
may vary from these assumptions, and 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 of this measure to
their closest GAAP equivalent 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
The financial results and business highlights will be discussed
on a conference call and webcast scheduled at 8:30 a.m. Eastern
Time on Wednesday, February 12, 2025. A live webcast of the call
can be accessed from Similarweb’s Investor Relations website at
https://ir.similarweb.com. An archived webcast of the conference
call will also be made available on the Similarweb website
following the call. The live call may also be accessed via
telephone at (877) 407-0726 toll-free and at +1 (201) 689-7806
internationally.
About Similarweb: Similarweb powers businesses to win
their markets with Digital Data. By providing essential web and app
data, analytics, and insights, we empower our users to discover
business opportunities, identify competitive threats, optimize
strategy, acquire the right customers, and increase monetization.
Similarweb products are integrated into users’ workflow, powered by
advanced technology, and based on leading comprehensive Digital
Data.
* Learn more: Similarweb | Similarweb
Digital Data
* Free Tools: Analyze any website or app |
Verify your website | Browser extension
* Follow us: Blog | LinkedIn
| YouTube | Instagram |
X
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, or the Securities Act, and Section 21E of the Securities
Exchange Act of 1934, as amended, including statements relating to
our guidance for the first quarter and full year of 2025 described
under "Financial Outlook". Forward-looking statements include all
statements that are not historical facts. Such statements may be
preceded by the words “intends,” “may,” “will,” “plans,” “expects,”
“anticipates,” “projects,” “predicts,” “estimates,” “aims,”
“believes,” “hopes,” “potential” or similar words. These
forward-looking statements reflect our current views regarding our
intentions, products, services, plans, expectations, strategies and
prospects, which are based on information currently available to us
and assumptions we have made. Actual results may differ materially
from those described in such forward-looking statements and are
subject to a number of known and unknown risks, uncertainties,
other factors and assumptions that are beyond our control. Such
risks and uncertainties include, without limitation, risks and
uncertainties associated with: (i) our expectations regarding our
revenue, expenses and other operating results; (ii) our ability to
acquire new customers and successfully retain existing customers;
(iii) our ability to increase usage of our solutions and upsell and
cross-sell additional solutions; (iv) our ability to achieve or
sustain profitability; (v) anticipated trends, growth rates, rising
interest rates, rising global inflation and current macroeconomic
conditions, challenges in our business and in the markets in which
we operate, and the impact of Israel's war with Hamas and other
terrorist organizations and hostilities with Iran or Lebanon on
geopolitical and macroeconomic conditions or on our company and
business; (vi) future investments in our business, our anticipated
capital expenditures and our estimates regarding our capital
requirements; (vii) the costs and success of our sales and
marketing efforts and our ability to promote our brand; (viii) our
reliance on key personnel and our ability to identify, recruit and
retain skilled personnel; (ix) our ability to effectively manage
our growth, including continued international expansion; (x) our
reliance on certain third party platforms and sources for the
collection of data necessary for our solutions; (xi) our ability to
protect our intellectual property rights and any costs associated
therewith; (xii) our ability to identify and complete acquisitions
that complement and expand our reach and platform; (xiii) our
ability to comply or remain in compliance with laws and regulations
that currently apply or become applicable to our business,
including in Israel, the United States, the European Union, the
United Kingdom and other jurisdictions where we elect to do
business; (xiv) our ability to compete effectively with existing
competitors and new market entrants; and (xv) the growth rates of
the markets in which we compete.
These risks and uncertainties are more fully described in our
filings with the Securities and Exchange Commission, including in
the section entitled “Risk Factors” in our Form 20-F filed with the
Securities and Exchange Commission on February 28, 2024, and
subsequent reports that we file with the Securities and Exchange
Commission. Moreover, we operate in a very competitive and rapidly
changing environment. New risks emerge from time to time. It is not
possible for our management to predict all risks, nor can we assess
the impact of all factors on our business or the extent to which
any factor, or combination of factors, may cause actual results to
differ materially from those contained in any forward-looking
statements we may make. In light of these risks, uncertainties and
assumptions, we cannot guarantee future results, levels of
activity, performance, achievements, or events and circumstances
reflected in the forward-looking statements will occur.
Forward-looking statements represent our beliefs and assumptions
only as of the date of this press release. Except as required by
law, we undertake no duty to update any forward-looking statements
contained in this release as a result of new information, future
events, changes in expectations or otherwise.
Non-GAAP Financial Measures
This press release contains certain financial measures that are
expressed on a non-GAAP basis. We use these non-GAAP financial
measures internally to facilitate analysis of our financial and
business trends and for internal planning and forecasting purposes.
We believe these non-GAAP financial measures, when taken
collectively, may be helpful to investors because they provide
consistency and comparability with past financial performance by
excluding certain items that may not be indicative of our business,
results of operations, or outlook. However, non-GAAP financial
measures have limitations as an analytical tool and are presented
for supplemental informational purposes only. They should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP or as a measure of
liquidity. Free cash flow represents net cash provided by (used in)
operating activities less capital expenditures and capitalized
internal-use software costs. Normalized free cash flow represents
free cash flow less capital investments related to the Company's
new headquarters, payments received in connection with these
capital investments and deferred payments related to business
combinations. Non-GAAP operating income (loss), non-GAAP gross
profit, non-GAAP gross margin, non-GAAP operating margin, non-GAAP
research and development expenses, non-GAAP sales and marketing
expenses and non-GAAP general and administrative expenses represent
the comparable GAAP financial figure operating income (loss) or
expense, less share-based compensation, adjustments and payments
related to business combinations, amortization of intangible assets
and certain other non-recurring items, as applicable and indicated
in the below tables.
Other Metrics
Customer acquisition costs (CAC) represent the portion of sales
and marketing expenses allocated to acquire new customers. Customer
retention costs (CRC) represent the portion of sales and marketing
expenses allocated to retain existing customers and to increase
existing customers’ subscriptions. Annual recurring revenue (ARR)
represents the annualized subscription revenue we would
contractually expect to receive from customers assuming no
increases or reductions in their subscriptions. CAC payback period
is the estimated time in months to recover CAC in terms of
incremental gross profit that newly acquired customers generate.
Net retention rate (NRR) represents the comparison of our ARR from
the same set of customers as of a certain point in time, relative
to the same point in time in the previous year ago period,
expressed as a percentage.
Similarweb Ltd.
Consolidated Balance Sheets
U.S. dollars in thousands (except
share and per share data)
December 31,
December 31,
2023
2024
Assets
Current assets:
Cash and cash equivalents
$
71,732
$
63,869
Restricted deposits
10,020
10,572
Accounts receivable, net
47,869
50,975
Deferred contract costs
11,165
11,373
Prepaid expenses and other current
assets
5,599
4,567
Total current assets
146,385
141,356
Property and equipment, net
28,630
25,921
Deferred contract costs, non-current
9,845
9,895
Operating lease right-of-use assets
36,007
34,393
Goodwill and Intangible assets, net
17,652
30,846
Other non-current assets
494
500
Total assets
$
239,013
$
242,911
Liabilities and shareholders'
equity
Current liabilities:
Borrowings under Credit Facility
$
25,000
$
—
Accounts payable
8,422
12,403
Payroll and benefit related
liabilities
20,437
20,304
Deferred revenue
99,968
108,232
Other payables and accrued expenses
23,263
29,330
Operating lease liabilities
7,095
6,923
Total current liabilities
184,185
177,192
Deferred revenue, non-current
878
1,172
Operating lease liabilities,
non-current
35,329
32,809
Other long-term liabilities
3,074
4,230
Total liabilities
223,466
215,403
Shareholders' equity
Ordinary Shares, NIS 0.01 par value
500,000,000 shares authorized as of December 31, 2023 and December
31, 2024, 78,653,046 and 82,620,679 shares issued as of December
31, 2023 and December 31, 2024, 78,650,878 and 82,618,511
outstanding as of December 31, 2023 and December 31, 2024,
respectively;
216
227
Additional paid-in capital
367,558
391,449
Accumulated other comprehensive income
872
388
Accumulated deficit
(353,099
)
(364,556
)
Total shareholders' equity
15,547
27,508
Total liabilities and shareholders'
equity
$
239,013
$
242,911
Similarweb Ltd.
Consolidated Statements of Comprehensive Income
(Loss)
U.S. dollars in thousands (except
share and per share data)
Year Ended December
31,
Three Months Ended December
31,
2023
2024
2023
2024
Revenue
$
218,019
$
249,913
$
56,755
$
65,587
Cost of revenue
47,090
54,814
11,859
15,331
Gross profit
170,929
195,099
44,896
50,256
Operating expenses:
Research and development
56,158
55,596
13,706
15,358
Sales and marketing
101,198
105,476
21,836
27,573
General and administrative
42,380
43,691
10,439
10,885
Total operating expenses
199,736
204,763
45,981
53,816
Loss from operations
(28,807
)
(9,664
)
(1,085
)
(3,560
)
Finance income (expenses), net
941
134
(2,085
)
(1,101
)
Loss before income taxes
(27,866
)
(9,530
)
(3,170
)
(4,661
)
Provision for income taxes
1,507
1,927
238
759
Net loss
$
(29,373
)
$
(11,457
)
$
(3,408
)
$
(5,420
)
Net loss per share attributable to
ordinary shareholders, basic and diluted
$
(0.38
)
$
(0.14
)
$
(0.04
)
$
(0.07
)
Weighted-average shares used in computing
net loss per share attributable to ordinary shareholders, basic and
diluted
77,752,960
80,825,695
78,443,438
82,073,002
Net loss
$
(29,373
)
$
(11,457
)
$
(3,408
)
$
(5,420
)
Other comprehensive income (loss), net
of tax
Change in unrealized gain (loss) on
cashflow hedges
1,239
(484
)
1,604
273
Total other comprehensive income (loss),
net of tax
1,239
(484
)
1,604
273
Total comprehensive loss
$
(28,134
)
$
(11,941
)
$
(1,804
)
$
(5,147
)
Share-based compensation costs
included above:
U.S. dollars in thousands
Year Ended December
31,
Three months Ended December
31,
2023
2024
2023
2024
(In thousands)
(In thousands)
Cost of revenue
$
635
$
812
$
153
$
234
Research and development
5,782
5,511
1,479
1,330
Sales and marketing
5,196
4,273
1,145
1,172
General and administrative
6,514
7,019
1,665
1,787
Total
$
18,127
$
17,615
$
4,442
$
4,523
Similarweb Ltd.
Consolidated Statements of Cash Flows
U.S. dollars in thousands
Year Ended December
31,
Three Months Ended December
31,
2023
2024
2023
2024
Cash flows from operating
activities:
Net loss
$
(29,373
)
$
(11,457
)
$
(3,408
)
$
(5,420
)
Adjustments to reconcile net loss to net
cash (used in) provided by operating activities:
Depreciation and amortization
10,258
10,528
2,570
2,516
Finance expense (income)
1,646
500
(106
)
711
Unrealized (gain) loss from hedging future
transactions
(52
)
103
(78
)
62
Share-based compensation
18,127
17,615
4,442
4,523
(Gain) loss from sale of equipment
—
(12
)
1
(2
)
Changes in operating assets and
liabilities:
Change in operating lease right-of-use
assets and liabilities, net
(1,926
)
(1,078
)
2,012
226
Increase in accounts receivable, net
(9,728
)
(2,127
)
(13,149
)
(15,488
)
Increase in deferred contract costs
(2,873
)
(258
)
(6,467
)
(1,846
)
Decrease in other current assets
617
612
2,204
1,366
Increase in other non-current assets
(53
)
(6
)
(461
)
(89
)
Increase (decrease) in accounts
payable
1,255
3,597
(3,054
)
1,313
Increase in deferred revenue
6,677
6,432
10,634
10,224
Increase in other non-current
liabilities
961
528
1,116
173
Increase in other liabilities and accrued
expenses
1,426
5,197
7,477
5,149
Net cash (used in) provided by operating
activities
(3,038
)
30,174
3,733
3,418
Cash flows from investing
activities:
Purchase of property and equipment,
net
(1,559
)
(1,430
)
(182
)
(232
)
Capitalized internal-use software
costs
(821
)
(1,304
)
(33
)
(511
)
Increase in restricted deposits
(206
)
(552
)
(74
)
(138
)
Payment for business combinations, net of
cash acquired
—
(15,414
)
—
28
Net cash used in investing activities
(2,586
)
(18,700
)
(289
)
(853
)
Cash flows from financing
activities:
Proceeds from exercise of stock
options
2,296
4,677
171
953
Proceeds from employee share purchase
plan
1,259
1,486
599
931
Repayment of Credit Facility
—
(25,000
)
—
—
Payments of contingent consideration,
net
(2,363
)
—
—
—
Net cash provided by (used in) financing
activities
1,192
(18,837
)
770
1,884
Effect of exchange rates on cash and cash
equivalents
(1,646
)
(500
)
106
(711
)
Net (decrease) increase in cash and cash
equivalents
(6,078
)
(7,863
)
4,320
3,738
Cash and cash equivalents, beginning of
period
77,810
71,732
67,412
60,131
Cash and cash equivalents, end of
period
$
71,732
$
63,869
$
71,732
$
63,869
Supplemental disclosure of cash flow
information:
Interest received, net
$
(203
)
$
(1,225
)
$
(114
)
$
(291
)
Taxes paid
$
1,883
$
1,168
$
26
$
303
Supplemental disclosure of non-cash
financing activities:
Additions to operating lease right-of-use
assets and liabilities
$
2,597
$
6,064
$
1,549
$
1,611
Share-based compensation included in
capitalized internal-use software
$
37
$
104
$
1
$
42
Deferred proceeds from exercise of share
options included in other current assets
$
11
$
29
$
(43
)
$
29
Deferred costs of property and equipment
incurred during the period included in accounts payable
$
139
$
227
$
76
$
227
Deferred payments in relation to business
combinations held in escrow
$
1,269
$
—
$
—
$
—
Schedule A: Business
combinations
Working capital (deficit), net (excluding
cash and cash equivalents)
—
(217
)
Property, plant and equipment
—
18
Goodwill and other intangible assets
—
4,524
Deferred taxes, net
—
(152
)
$
—
$
4,173
Less non-cash:
Deferred cash payments
$
—
$
(340
)
Total
$
—
$
3,833
Schedule B: Business
combinations
Working capital (deficit), net (excluding
cash and cash equivalents)
—
(1,474
)
Goodwill and other intangible assets
—
13,531
Deferred taxes, net
—
(476
)
$
—
$
11,581
Reconciliation of Non-GAAP
Financial Measures to the Most Directly Comparable GAAP Financial
Measures
Reconciliation of GAAP gross
profit to non-GAAP gross profit
Year Ended December
31,
Three months Ended December
31,
2023
2024
2023
2024
(In thousands)
(In thousands)
GAAP gross profit
$
170,929
$
195,099
$
44,896
$
50,256
Add:
Share-based compensation expenses
635
812
153
234
Retention payments related to business
combinations
306
65
—
21
Amortization of intangible assets related
to business combinations
4,641
4,191
1,137
815
Non-GAAP gross profit
$
176,511
$
200,167
$
46,186
$
51,326
Non-GAAP gross margin
81
%
80
%
81
%
78
%
Reconciliation of Loss from
operations (GAAP) to Non-GAAP operating (loss) profit
Year Ended December
31,
Three months Ended December
31,
2023
2024
2023
2024
(In thousands)
(In thousands)
Loss from operations
$
(28,807
)
$
(9,664
)
$
(1,085
)
$
(3,560
)
Add:
Share-based compensation expenses
18,127
17,615
4,442
4,523
Retention payments related to business
combinations
1,072
1,886
221
539
Amortization of intangible assets related
to business combinations
4,776
4,862
1,171
1,067
Non-recurring expenses related to
termination of lease agreement and others
17
—
—
—
Secondary offering costs
—
350
—
—
Non-GAAP operating (loss)
profit
$
(4,815
)
$
15,049
$
4,749
$
2,569
Non-GAAP operating margin
(2
)%
6
%
8
%
4
%
Reconciliation of GAAP
operating expenses to non-GAAP operating expenses
Year Ended December
31,
Three months Ended December
31,
2023
2024
2023
2024
(In thousands)
(In thousands)
GAAP research and development
$
56,158
$
55,596
$
13,706
$
15,358
Less:
Share-based compensation expenses
5,782
5,511
1,479
1,330
Retention payments related to business
combinations
—
38
—
11
Non-GAAP research and
development
$
50,376
$
50,047
$
12,227
$
14,017
Non-GAAP research and development
margin
23
%
20
%
22
%
21
%
GAAP sales and marketing
$
101,198
$
105,476
$
21,836
$
27,573
Less:
Share-based compensation expenses
5,196
4,273
1,145
1,172
Retention payments related to business
combinations
766
1,783
221
507
Amortization of intangible assets related
to business combinations
135
671
34
252
Non-recurring expenses related to
termination of lease agreement and others
17
—
—
—
Non-GAAP sales and marketing
$
95,084
$
98,749
$
20,436
$
25,642
Non-GAAP sales and marketing
margin
44
%
40
%
36
%
39
%
GAAP general and administrative
$
42,380
$
43,691
$
10,439
$
10,885
Less:
Share-based compensation expenses
6,514
7,019
1,665
1,787
Secondary offering costs
—
350
—
—
Non-GAAP general and
administrative
$
35,866
$
36,322
$
8,774
$
9,098
Non-GAAP general and administrative
margin
16
%
15
%
15
%
14
%
Reconciliation of Net cash
(used in) provided by operating activities (GAAP) to Free cash flow
and Normalized free cash flow
Year Ended December
31,
Three months Ended December
31,
2023
2024
2023
2024
(In thousands)
(In thousands)
Net cash (used in) provided by operating
activities
$
(3,038
)
$
30,174
$
3,733
$
3,418
Purchases of property and equipment,
net
(1,559
)
(1,430
)
(182
)
(232
)
Capitalized internal use software
costs
(821
)
(1,304
)
(33
)
(511
)
Free cash flow
$
(5,418
)
$
27,440
$
3,518
$
2,675
Purchases of property and equipment
related to the new headquarters
1,156
—
29
—
Payments received from escrow in relation
to contingent consideration
(380
)
—
—
—
Deferred payments in relation to business
combinations
260
265
—
—
Normalized free cash flow
$
(4,382
)
$
27,705
$
3,547
$
2,675
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250211545525/en/
Press Contact: David Carr
Similarweb press@similarweb.com
Investor Contact: Rami
Myerson Similarweb rami.myerson@similarweb.com
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