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Domo Announces First Quarter Fiscal 2021 Financial Results

SILICON SLOPES, Utah, June 04, 2020 (GLOBE NEWSWIRE) -- Domo, Inc. (DOMO) today announced results for the fiscal 2021 first quarter ended April 30, 2020.

Fiscal First Quarter Results

  • Total revenue was $48.6 million, an increase of 19% year over year
  • Subscription revenue was $42.4 million, an increase of 23% year over year
  • Subscription revenue represented 87% of total revenue
  • Billings were $46.5 million or 13% year-over-year growth
  • Net cash used in operating activities was $12.9 million, an improvement of 52% year over year
  • Adjusted net cash used in operating activities was $9.3 million, an improvement of 58% year over year
  • Subscription gross margin was 79%, an improvement of 2 percentage points from Q1 FY20
  • GAAP operating margin improved by 36 percentage points year over year
  • Non-GAAP operating margin improved by 34 percentage points year over year
  • GAAP net loss was $24.9 million, and GAAP net loss per share was $0.88, based on 28.5 million weighted-average shares outstanding
  • Non-GAAP net loss was $18.4 million, and non-GAAP net loss per share was $0.65, based on 28.5 million weighted-average shares outstanding
  • Cash, cash equivalents and short-term investments were $88.1 million as of April 30, 2020

"Our company was built to deliver exactly what is needed today — real-time information packaged for easy consumption, for widespread distribution on any device, at massive scale, and available in record time,” said Josh James, founder and CEO, Domo. "We are pleased we could help the governors of three states have access to the actionable data they need to manage through the current health crisis. We are now applying the same capabilities to the private sector to help them manage their employee base and help them safely get back to work with apps and solutions built on our platform to address this specific opportunity."

Recent Highlights

We believe the following points and accolades from the last quarter are additional indicators of what’s to come in our business through our commitment to product innovation, go-to-market initiatives and customer success:

Business Outlook

Based on information available as of June 4, 2020, Domo is providing the following guidance for Q2 and full year fiscal 2021:

Q2 Fiscal 2021

  • Revenue is expected to be in the range of $48.5 million to $49.5 million
  • Non-GAAP net loss per share is expected to be between $0.48 and $0.52 based on 29.0 million weighted-average shares outstanding

Full Year Fiscal 2021

  • Revenue is expected to be in the range of $194.0 million to $200.0 million
  • Non-GAAP net loss per share is expected to be between $1.96 and $2.06 based on 29.2 million weighted-average shares outstanding

We have not reconciled guidance for non-GAAP metrics to their most directly comparable GAAP measures because such 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 2021 first 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. A live dial-in is available domestically at (877) 491-5762 and internationally at (763) 416-6939, with conference ID#8687253. A replay will be available via webcast or at (855) 859-2056 or (404) 537-3406 until midnight (ET) June 18, 2020.

About Domo

Domo is the Business Cloud, empowering organizations of all sizes with BI leverage at cloud scale in record time. With Domo, BI-critical processes that took weeks, months or more can now be done on-the-fly, in minutes or seconds, at unbelievable scale.  For more information about how Domo (DOMO) helps its customers go fast, go big and go bold, visit www.domo.com. You can also follow Domo on Twitter, 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 Twitter account and the @JoshJames Twitter 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.

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 net cash used in operating activities. In computing these measures, we exclude the effects of certain items including stock-based compensation expense, amortization of certain intangible assets, the reversal of contingent tax-related accruals and proceeds from shares issued in connection with employee stock purchase plan. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and our non-GAAP measures may be different from non-GAAP measures used by other companies.

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.

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 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 regarding our future growth, demand for our products and services, our financial outlook for Q2 fiscal quarter and full fiscal year 2021, 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 U.S. Securities and Exchange Commission, including, without limitation, the Annual Report on Form 10-K filed with the SEC on April 10, 2020 and the Quarterly Report on Form 10-Q for the fiscal quarter ended April 30, 2020 expected to be filed with the SEC on or about June 9, 2020, as well as risks to our business related to the COVID-19 outbreak.  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, Domo Business Cloud and Domo is the Business Cloud are registered trademarks of Domo, Inc.

Investor contact:  IR@domo.com
Media contact: PR@domo.com



Domo, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
       
  Three Months Ended
  April 30,
    2019       2020  
Revenue:      
Subscription $ 34,391     $ 42,436  
Professional services and other   6,407       6,125  
Total revenue   40,798       48,561  
Cost of revenue:      
Subscription (1)   8,035       9,105  
Professional services and other (1)   4,769       5,004  
Total cost of revenue   12,804       14,109  
Gross profit   27,994       34,452  
       
Operating expenses:      
Sales and marketing (1)   35,949       29,096  
Research and development (1)   17,099       17,453  
General and administrative (1), (2), (3)   8,017       9,869  
Total operating expenses   61,065       56,418  
Loss from operations   (33,071 )     (21,966 )
       
Other expense, net (1)   (2,325 )     (2,724 )
Loss before provision for income taxes   (35,396 )     (24,690 )
Provision for income taxes   140       205  
Net loss $ (35,536 )   $ (24,895 )
       
Net loss per share (basic and diluted) $ (1.32 )   $ (0.88 )
Weighted-average number of shares (basic and diluted)   26,966       28,450  
       
       
(1) Includes stock-based compensation expenses, as follows:      
Cost of revenue:      
Subscription $ 123     $ 226  
Professional services and other   93       103  
Sales and marketing   4,008       1,826  
Research and development   2,065       1,877  
General and administrative   1,238       2,397  
Other expense, net   48       47  
Total stock-based compensation expenses $ 7,575     $ 6,476  
       
(2) Includes amortization of certain intangible assets, as follows:      
General and administrative $ 20     $ 20  
       
(3) Includes reversal of contingent tax-related accrual, as follows:      
General and administrative $ (1,293 )   $ -  
       


Domo, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
       
  January 31,   April 30,
    2020       2020  
Assets      
Current assets:      
Cash and cash equivalents $ 80,843     $ 75,543  
Short-term investments   17,967       12,571  
Accounts receivable, net   47,967       29,644  
Contract acquisition costs   12,676       12,513  
Prepaid expenses and other current assets   12,809       12,507  
Total current assets   172,262       142,778  
       
Property and equipment, net   12,816       13,111  
Right-of-use assets   -       11,095  
Contract acquisition costs, noncurrent   17,083       15,641  
Intangible assets, net   3,865       3,815  
Goodwill   9,478       9,478  
Other assets   1,234       1,300  
Total assets $ 216,738     $ 197,218  
       
Liabilities and stockholders' deficit      
Current liabilities:      
Accounts payable $ 2,298     $ 2,347  
Accrued expenses and other current liabilities   46,473       30,892  
Lease liabilities   -       3,610  
Current portion of deferred revenue   105,290       104,804  
Total current liabilities   154,061       141,653  
       
Lease liabilities, noncurrent   -       8,166  
Deferred revenue, noncurrent   4,454       2,916  
Other liabilities, noncurrent   6,329       6,415  
Long-term debt   101,074       102,056  
Total liabilities   265,918       261,206  
       
Commitments and contingencies      
       
Stockholders' deficit:      
Common stock   28       29  
Additional paid-in capital   988,141       998,271  
Accumulated other comprehensive income   389       345  
Accumulated deficit   (1,037,738 )     (1,062,633 )
Total stockholders' deficit   (49,180 )     (63,988 )
Total liabilities and stockholders' deficit $ 216,738     $ 197,218  
       


Domo, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
       
  Three Months Ended
  April 30,
    2019       2020  
Cash flows from operating activities      
Net loss $ (35,536 )   $ (24,895 )
Adjustments to reconcile net loss to net cash used in operating activities:      
Depreciation and amortization   1,764       1,293  
Non-cash lease expense   -       951  
Amortization of contract acquisition costs   2,678       3,408  
Stock-based compensation   7,575       6,476  
Other, net   (659 )     879  
Changes in operating assets and liabilities:      
Accounts receivable, net   12,214       18,323  
Contract acquisition costs   (2,062 )     (1,926 )
Prepaid expenses and other assets   (4,493 )     213  
Accounts payable   551       45  
Operating lease liabilities   -       (905 )
Accrued and other liabilities   (8,977 )     (14,751 )
Deferred revenue   267       (2,024 )
Net cash used in operating activities   (26,678 )     (12,913 )
       
Cash flows from investing activities      
Purchases of property and equipment   (1,474 )     (1,363 )
Purchases of securities available for sale   (63,008 )     (11,149 )
Proceeds from maturities of securities available for sale   -       16,600  
Purchases of intangible assets   -       (104 )
Net cash (used in) provided by investing activities   (64,482 )     3,984  
       
Cash flows from financing activities      
Proceeds from shares issued in connection with employee stock purchase plan   4,518       3,659  
Shares repurchased for tax withholdings on vesting of restricted stock   (900 )     (38 )
Proceeds from exercise of stock options   1,338       11  
Net cash provided by financing activities   4,956       3,632  
Effect of exchange rate changes on cash and cash equivalents   (6 )     (3 )
Net decrease in cash and cash equivalents   (86,210 )     (5,300 )
Cash and cash equivalents at beginning of period   176,973       80,843  
Cash and cash equivalents at end of period $ 90,763     $ 75,543  
       


Domo, Inc.
Reconciliation of Non-GAAP Financial Measures
(in thousands, except per share data)
(unaudited)
       
  Three Months Ended
  April 30,
    2019       2020  
Reconciliation of Subscription Gross Margin on a GAAP Basis to Subscription Gross Margin on a Non-GAAP Basis:      
Revenue:      
Subscription $ 34,391     $ 42,436  
Cost of revenue:      
Subscription   8,035       9,105  
Subscription gross profit on a GAAP basis   26,356       33,331  
Subscription gross margin on a GAAP basis   77 %     79 %
       
Stock-based compensation   123       226  
Subscription gross profit on a non-GAAP basis $ 26,479     $ 33,557  
Subscription gross margin on a non-GAAP basis   77 %     79 %
       
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 $ 61,065     $ 56,418  
Stock-based compensation   (7,311 )     (6,100 )
Amortization of certain intangible assets   (20 )     (20 )
Reversal of contingent tax-related accrual   1,293       -  
Total operating expenses on a non-GAAP basis $ 55,027     $ 50,298  
       
Reconciliation of Operating Loss on a GAAP Basis to Operating Loss on a Non-GAAP Basis:      
Operating loss on a GAAP basis $ (33,071 )   $ (21,966 )
Stock-based compensation   7,527       6,429  
Amortization of certain intangible assets   20       20  
Reversal of contingent tax-related accrual   (1,293 )     -  
Operating loss on a non-GAAP basis $ (26,817 )   $ (15,517 )
       
Reconciliation of Operating Margin on a GAAP Basis to Operating Margin on a Non-GAAP Basis:      
Operating margin on a GAAP basis   (81 )%     (45 )%
Stock-based compensation   18       13  
Amortization of certain intangible assets   -       -  
Reversal of contingent tax-related accrual   (3 )     -  
Operating margin on a non-GAAP basis   (66 )%     (32 )%
       
Reconciliation of Net Loss on a GAAP Basis to Net Loss on a Non-GAAP Basis:      
Net loss on a GAAP basis $ (35,536 )   $ (24,895 )
Stock-based compensation   7,575       6,476  
Amortization of certain intangible assets   20       20  
Reversal of contingent tax-related accrual   (1,293 )     -  
Net loss on a non-GAAP basis $ (29,234 )   $ (18,399 )
       
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 $ (1.32 )   $ (0.88 )
Stock-based compensation   0.29       0.23  
Amortization of certain intangible assets   -       -  
Reversal of contingent tax-related accrual   (0.05 )     -  
Net loss per share on a non-GAAP basis $ (1.08 )   $ (0.65 )
       
Billings:      
Total revenue $ 40,798     $ 48,561  
Add:      
Deferred revenue (end of period)   89,219       104,804  
Deferred revenue, noncurrent (end of period)   4,950       2,916  
Less:      
Deferred revenue (beginning of period)   (88,959 )     (105,290 )
Deferred revenue, noncurrent (beginning of period)   (4,943 )     (4,454 )
Increase (decrease) in deferred revenue (current and noncurrent)   267       (2,024 )
Billings $ 41,065     $ 46,537  
       
Reconciliation of Net Cash Used in Operating Activities to Adjusted Net Cash Used in Operating Activities:      
Net cash used in operating activities $ (26,678 )   $ (12,913 )
Proceeds from shares issued in connection with employee stock purchase plan   4,518       3,659  
Adjusted net cash used in operating activities $ (22,160 )   $ (9,254 )