Domo Announces Third Quarter Fiscal 2022 Financial Results

Rhea-AI Summary

Domo, Inc. (Nasdaq: DOMO) reported its fiscal third quarter results for the period ending October 31, 2021. Total revenue reached $65.1 million, up 21% year-over-year, with subscription revenue also at $56.6 million, representing 87% of total revenue. Billings increased 26% to $70.2 million. Remaining Performance Obligations stood at $296.9 million, a 19% rise year-over-year. The company reported a GAAP net loss of $28.5 million and had cash and cash equivalents of $84.2 million as of the quarter's end.

Positive

• 21% year-over-year revenue growth to $65.1 million.
• Subscription revenue increased 21% to $56.6 million, making up 87% of total revenue.
• Billings surged 26% to $70.2 million.
• Remaining Performance Obligations rose 19% to $296.9 million.
• RPO expected to be recognized in the next 12 months increased 24% to $190.6 million.

Negative

• GAAP net loss of $28.5 million for the quarter.
• GAAP operating margin declined by 3 percentage points year-over-year.

SILICON SLOPES, Utah--(BUSINESS WIRE)-- Domo, Inc. (Nasdaq: DOMO) today announced results for its fiscal third quarter ended October 31, 2021.

Fiscal Third Quarter Results

• Total revenue was $65.1 million, an increase of 21% year over year
• Subscription revenue was $56.6 million, an increase of 21% year over year
• Subscription revenue represented 87% of total revenue
• Billings were $70.2 million or 26% year-over-year growth
• Remaining Performance Obligations (RPO) was $296.9 million as of October 31, 2021, an increase of 19% year over year
• RPO expected to be recognized as revenue in the next twelve months was $190.6 million as of October 31, 2021, an increase of 24% year over year
• Net cash provided by operating activities was $0.03 million
• GAAP subscription gross margin was 81%, an improvement of 1 percentage point from Q3 FY21
• Non-GAAP subscription gross margin was 83%, an improvement of 2 percentage points from Q3 FY21
• GAAP operating margin declined by 3 percentage points year over year
• Non-GAAP operating margin improved by 6 percentage points year over year
• GAAP net loss was $28.5 million, and GAAP net loss per share was $0.88, based on 32.4 million weighted-average shares outstanding
• Non-GAAP net loss was $10.3 million, and non-GAAP net loss per share was $0.32, based on 32.4 million weighted-average shares outstanding
• Cash and cash equivalents were $84.2 million as of October 31, 2021

“We delivered strong results for the quarter, driven by continued market demand for our core modern BI solution and fueled by increasing demand for data-enabled apps to help our customers run their businesses on the Domo platform,” said Josh James, founder and CEO, Domo.

Recent Highlights

We believe the following recognition and research demonstrate our commitment to product innovation, go-to-market initiatives and customer success:

• Domo was named a Leader in Nucleus Research’s 2021 Value Matrix for Embedded Analytics Technology.
• Domo was named to Inc.’s first annual Best-Led Companies list — a select, data-driven list of the very strongest U.S. firms with revenue of $50 million to $2 billion.
• Domo was named to Constellation Research's ShortList™ for Cloud-Based Business Intelligence and Analytics Platforms for Q3 2021 and for Marketing Analytics Solutions for Q3 2021.
• Domo launched Sandbox, a new development and testing environment built on the Domo platform, to help customers more easily create and promote content into production across the enterprise.

Business Outlook

Based on information available as of December 2, 2021, Domo is providing the following guidance for its fourth fiscal quarter and full year fiscal 2022:

Q4 Fiscal 2022

• Revenue is expected to be in the range of $66.5 million to $67.5 million
• Non-GAAP net loss per share is expected to be between $0.37 and $0.41 based on 32.8 million weighted-average shares outstanding

Full Year Fiscal 2022

• Revenue is expected to be in the range of $254.5 million to $255.5 million
• Non-GAAP net loss per share is expected to be between $1.26 and $1.30 based on 32.0 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 2022 third 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. Participants can register for the call in advance by visiting https://conferencingportals.com/event/zYvDlnjs. Instructions will be shared on how to join the call after registering.

A replay will be available at (800) 770-2030 or (647) 362-9199 with conference ID #41576 following the completion of the conference call until 11:59 p.m. (ET) December 16, 2021.

About Domo

Domo (Nasdaq: DOMO) is the Business Cloud, transforming the way business is managed by delivering Modern BI for All™. With Domo, 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, 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. The social media channels that we intend to use as a means of disclosing the information described here may be updated from time to time as listed on our investor relations webpage.

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, adjusted net cash used in operating activities, and free cash flow. 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 our fourth fiscal quarter and full fiscal year 2022, 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 1, 2021 and the Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2021 expected to be filed with the SEC on or about December 10, 2021, as well as risks to our business related to the COVID-19 pandemic. 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.

Domo, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
		Three Months Ended								Nine Months Ended
		October 31,								October 31,
		2020				2021				2020				2021
Revenue:
Subscription		$	46,906			$	56,621			$	133,689			$	163,399
Professional services and other			6,739				8,460				19,648				24,569
Total revenue			53,645				65,081				153,337				187,968
Cost of revenue:
Subscription (1)			9,372				10,514				27,288				29,590
Professional services and other (1)			5,106				6,630				14,948				19,030
Total cost of revenue			14,478				17,144				42,236				48,620
Gross profit			39,167				47,937				111,101				139,348
Operating expenses:
Sales and marketing (1)			29,609				37,503				86,089				104,335
Research and development (1)			16,504				21,984				49,874				57,511
General and administrative (1), (2)			11,929				13,430				31,355				36,032
Total operating expenses			58,042				72,917				167,318				197,878
Loss from operations			(18,875	)			(24,980	)			(56,217	)			(58,530	)
Other expense, net (1)			(3,215	)			(3,471	)			(8,356	)			(10,238	)
Loss before income taxes			(22,090	)			(28,451	)			(64,573	)			(68,768	)
Provision for income taxes			131				62				446				89
Net loss		$	(22,221	)		$	(28,513	)		$	(65,019	)		$	(68,857	)
Net loss per share (basic and diluted)		$	(0.75	)		$	(0.88	)		$	(2.24	)		$	(2.17	)
Weighted-average number of shares (basic and diluted)			29,533				32,363				28,998				31,758
(1) Includes stock-based compensation expenses, as follows:
Cost of revenue:
Subscription		$	377			$	800			$	750			$	1,768
Professional services and other			273				563				494				1,168
Sales and marketing			3,301				6,718				7,670				15,192
Research and development			2,716				5,363				6,595				10,603
General and administrative			3,452				4,543				8,172				11,596
Other expense, net			172				176				267				524
Total stock-based compensation expenses		$	10,291			$	18,163			$	23,948			$	40,851
(2) Includes amortization of certain intangible assets, as follows:
General and administrative		$	20			$	20			$	60			$	60

Domo, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
		January 31,				October 31,
		2021				2021
Assets
Current assets:
Cash and cash equivalents		$	90,794			$	84,245
Accounts receivable, net			48,272				38,895
Contract acquisition costs			13,894				13,795
Prepaid expenses and other current assets			12,216				7,314
Total current assets			165,176				144,249
Property and equipment, net			14,745				16,998
Right-of-use assets			3,663				17,738
Contract acquisition costs, noncurrent			18,605				18,474
Intangible assets, net			3,356				2,895
Goodwill			9,478				9,478
Other assets			1,415				1,301
Total assets		$	216,438			$	211,133
Liabilities and stockholders' deficit
Current liabilities:
Accounts payable		$	1,085			$	12,021
Accrued expenses and other current liabilities			51,950				44,903
Lease liabilities			3,808				3,117
Current portion of deferred revenue			129,079				130,385
Total current liabilities			185,922				190,426
Lease liabilities, noncurrent			1,556				17,565
Deferred revenue, noncurrent			3,173				2,352
Other liabilities, noncurrent			9,637				10,495
Long-term debt			99,609				102,852
Total liabilities			299,897				323,690
Commitments and contingencies
Stockholders' deficit:
Common stock			30				32
Additional paid-in capital			1,038,006				1,077,993
Accumulated other comprehensive income			877				647
Accumulated deficit			(1,122,372	)			(1,191,229	)
Total stockholders' deficit			(83,459	)			(112,557	)
Total liabilities and stockholders' deficit		$	216,438			$	211,133

Domo, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
		Three Months Ended								Nine Months Ended
		October 31,								October 31,
		2020				2021				2020				2021
Cash flows from operating activities
Net loss		$	(22,221	)		$	(28,513	)		$	(65,019	)		$	(68,857	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization			1,126				1,533				3,490				3,789
Non-cash lease expense			1,044				1,224				2,997				3,540
Amortization of contract acquisition costs			3,657				3,944				10,577				11,779
Stock-based compensation			10,291				18,163				23,948				40,851
Other, net			1,634				877				3,456				2,663
Changes in operating assets and liabilities:
Accounts receivable, net			(2,855	)			(7,746	)			10,179				9,377
Contract acquisition costs			(4,047	)			(4,354	)			(9,939	)			(11,719	)
Prepaid expenses and other assets			474				664				4,039				4,949
Accounts payable			2,991				4,652				2,397				10,965
Operating lease liabilities			(996	)			(669	)			(2,564	)			(2,380	)
Accrued and other liabilities			5,159				5,131				506				(5,972	)
Deferred revenue			2,027				5,123				(3,487	)			485
Net cash (used in) provided by operating activities			(1,716	)			29				(19,420	)			(530	)
Cash flows from investing activities
Purchases of property and equipment			(1,105	)			(1,547	)			(4,259	)			(4,965	)
Purchases of securities available for sale			-				-				(11,149	)			-
Proceeds from maturities of securities available for sale			4,900				-				29,200				-
Purchases of intangible assets			(6	)			-				(111	)			-
Net cash provided by (used in) investing activities			3,789				(1,547	)			13,681				(4,965	)
Cash flows from financing activities
Proceeds from shares issued in connection with employee stock purchase plan			3,099				-				6,748				4,133
Shares repurchased for tax withholdings on vesting of restricted stock			(194	)			(1,280	)			(717	)			(8,858	)
Proceeds from exercise of stock options			446				745				2,505				3,908
Net cash provided by (used in) financing activities			3,351				(535	)			8,536				(817	)
Effect of exchange rate changes on cash and cash equivalents			(66	)			(75	)			173				(237	)
Net increase (decrease) in cash and cash equivalents			5,358				(2,128	)			2,970				(6,549	)
Cash and cash equivalents at beginning of period			78,455				86,373				80,843				90,794
Cash and cash equivalents at end of period		$	83,813			$	84,245			$	83,813			$	84,245

Domo, Inc.
Reconciliation of Non-GAAP Financial Measures
(in thousands, except per share data)
(unaudited)
			Three Months Ended								Nine Months Ended
			October 31,								October 31,
			2020				2021				2020				2021
Reconciliation of Subscription Gross Margin on a GAAP Basis to Subscription Gross Margin on a Non-GAAP Basis:
Revenue:
Subscription			$	46,906			$	56,621			$	133,689			$	163,399
Cost of revenue:
Subscription				9,372				10,514				27,288				29,590
Subscription gross profit on a GAAP basis				37,534				46,107				106,401				133,809
Subscription gross margin on a GAAP basis				80	%			81	%			80	%			82	%
Stock-based compensation				377				800				750				1,768
Subscription gross profit on a non-GAAP basis			$	37,911			$	46,907			$	107,151			$	135,577
Subscription gross margin on a non-GAAP basis				81	%			83	%			80	%			83	%
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			$	58,042			$	72,917			$	167,318			$	197,878
Stock-based compensation				(9,469	)			(16,624	)			(22,437	)			(37,391	)
Amortization of certain intangible assets				(20	)			(20	)			(60	)			(60	)
Total operating expenses on a non-GAAP basis			$	48,553			$	56,273			$	144,821			$	160,427
Reconciliation of Operating Loss on a GAAP Basis to Operating Loss on a Non-GAAP Basis:
Operating loss on a GAAP basis			$	(18,875	)		$	(24,980	)		$	(56,217	)		$	(58,530	)
Stock-based compensation				10,119				17,987				23,681				40,327
Amortization of certain intangible assets				20				20				60				60
Operating loss on a non-GAAP basis			$	(8,736	)		$	(6,973	)		$	(32,476	)		$	(18,143	)
Reconciliation of Operating Margin on a GAAP Basis to Operating Margin on a Non-GAAP Basis:
Operating margin on a GAAP basis				(35	)%			(38	)%			(37	)%			(31	)%
Stock-based compensation				19				27				16				21
Operating margin on a non-GAAP basis				(16	)%			(11	)%			(21	)%			(10	)%
Reconciliation of Net Loss on a GAAP Basis to Net Loss on a Non-GAAP Basis:
Net loss on a GAAP basis			$	(22,221	)		$	(28,513	)		$	(65,019	)		$	(68,857	)
Stock-based compensation				10,291				18,163				23,948				40,851
Amortization of certain intangible assets				20				20				60				60
Net loss on a non-GAAP basis			$	(11,910	)		$	(10,330	)		$	(41,011	)		$	(27,946	)
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			$	(0.75	)		$	(0.88	)		$	(2.24	)		$	(2.17	)
Stock-based compensation				0.35				0.56				0.83				1.29
Net loss per share on a non-GAAP basis			$	(0.40	)		$	(0.32	)		$	(1.41	)		$	(0.88	)
Billings:
Total revenue			$	53,645			$	65,081			$	153,337			$	187,968
Add:
Deferred revenue (end of period)				103,075				130,385				103,075				130,385
Deferred revenue, noncurrent (end of period)				3,182				2,352				3,182				2,352
Less:
Deferred revenue (beginning of period)				(101,982	)			(126,381	)			(105,290	)			(129,079	)
Deferred revenue, noncurrent (beginning of period)				(2,248	)			(1,233	)			(4,454	)			(3,173	)
Increase (decrease) in deferred revenue (current and noncurrent)				2,027				5,123				(3,487	)			485
Billings			$	55,672			$	70,204			$	149,850			$	188,453
Reconciliation of Net Cash (Used in) Provided by Operating Activities to Adjusted Net Cash Provided by (Used in) Operating Activities:
Net cash (used in) provided by operating activities			$	(1,716	)		$	29			$	(19,420	)		$	(530	)
Proceeds from shares issued in connection with employee stock purchase plan				3,099				-				6,748				4,133
Adjusted net cash provided by (used in) operating activities			$	1,383			$	29			$	(12,672	)		$	3,603
Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow:
Net cash (used in) provided by operating activities			$	(1,716	)		$	29			$	(19,420	)		$	(530	)
Proceeds from shares issued in connection with employee stock purchase plan				3,099				-				6,748				4,133
Purchases of property and equipment				(1,105	)			(1,547	)			(4,259	)			(4,965	)
Free cash flow			$	278			$	(1,518	)		$	(16,931	)		$	(1,362	)

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20211202005938/en/

Media –

Julie Kehoe

PR@domo.com

Investors –

Peter Lowry

IR@domo.com

Source: Domo, Inc.

FAQ

What were Domo's fiscal Q3 2021 revenue figures?

Domo reported total revenue of $65.1 million for fiscal Q3 2021, a 21% increase year-over-year.

What is Domo's guidance for Q4 fiscal 2022?

Domo expects Q4 fiscal 2022 revenue to be in the range of $66.5 million to $67.5 million.

What was Domo's net loss in Q3 2021?

Domo reported a GAAP net loss of $28.5 million in the fiscal third quarter of 2021.

How did Domo's subscription revenue perform in Q3 2021?

Subscription revenue for Q3 2021 was $56.6 million, reflecting a 21% increase year-over-year.

What are Domo's remaining performance obligations as of Q3 2021?

Domo's remaining performance obligations were $296.9 million as of October 31, 2021.