Asure Software Inc (ASUR) Reports Significant Revenue Growth in Q3 2023
Asure Software Inc (NASDAQ:ASUR) announces a 34% increase in Q3 revenue, reaching $29.3 million.
Gross profit surges by 56% compared to the previous year, with non-GAAP gross margin hitting 76%.
Net loss improves by $2.3 million, while EBITDA and Adjusted EBITDA see substantial gains.
ASUR provides Q4 2023 and preliminary FY 2024 guidance, signaling continued growth.
On November 13, 2023, Asure Software Inc (NASDAQ:ASUR), a leader in cloud-based Human Capital Management (HCM) solutions, released its 8-K filing, detailing a robust financial performance for the third quarter ended September 30, 2023. The company reported a significant 34% increase in revenue year-over-year, totaling $29.3 million, with recurring revenue also up by 19%. This growth is attributed to both organic expansion and efficient operations.
Financial Performance Highlights
ASUR's third-quarter results showcased a marked improvement in its financial health. The net loss was reduced by $2.2 million, a notable improvement from the previous year's figures. EBITDA rose to $3.0 million, up $1.7 million, while Adjusted EBITDA experienced a more pronounced increase of $4.4 million, reaching $6.2 million. Gross profit also saw a significant uptick, jumping 56% to $21.3 million, with a non-GAAP gross margin of 76%, compared to 68% in the prior-year quarter.
Strategic Business Developments
ASUR has been actively enhancing its business through various strategic initiatives. The company completed an equity offering, resulting in net proceeds of approximately $43 million. It also announced the payoff of debt with Structural Capital Investments III, LP, which is expected to improve cash flow and earnings. New product launches, such as a bundled 401k offering with tax credits and the introduction of Lendio in the Asure Marketplace, are designed to support small businesses and expand ASUR's client base.
Management's Outlook and Guidance
Pat Goepel, Chairman and CEO of ASUR, expressed optimism about the company's trajectory, citing "another strong performance" and anticipating high-margin revenue streams in the future. The company has issued guidance for Q4 2023, expecting revenues between $25M-$27M, and has introduced preliminary guidance for 2024, with revenues projected to be in the range of $125M-$129M and adjusted EBITDA margins between 20% to 21%.
Financial Statements Overview
The balance sheet reflects a healthy liquidity position, with cash and cash equivalents standing at $32.8 million as of September 30, 2023. ASUR's efforts to streamline operations are evident in the reduction of total current liabilities from $235.2 million to $192.8 million over the nine-month period. The company's equity offering has also bolstered its financial position, with total stockholders' equity increasing from $145.1 million to $191.7 million.
Non-GAAP and Adjusted Financial Measures
ASUR's use of non-GAAP and adjusted financial measures provides additional insight into the company's operational performance. These measures exclude items such as share-based compensation, amortization, and one-time expenses, offering a clearer view of the company's ongoing financial health. A detailed reconciliation of these non-GAAP measures to their GAAP counterparts is provided in the filing.
In conclusion, Asure Software Inc (NASDAQ:ASUR) has demonstrated strong financial growth in the third quarter of 2023, with significant increases in revenue and gross profit. The company's strategic initiatives and product launches are expected to continue driving growth, as reflected in the positive guidance for the upcoming quarters. Investors and stakeholders can look forward to ASUR's sustained momentum and strategic execution in the HCM marketplace.
Explore the complete 8-K earnings release (here) from Asure Software Inc for further details.
This article first appeared on GuruFocus.
