Five9 Reports Fourth Quarter Revenue Growth of 20% to a Record $208.3 Million

Rhea-AI Summary

Five9, a cloud contact center software provider, reported strong financial results for Q4 and full year 2022. Q4 revenue reached a record $208.3 million, up 20% year-over-year, driven by a 32% growth in LTM enterprise subscription revenue. Overall, 2022 revenue grew 28% to $778.8 million. Operating cash flow in Q4 was robust at $32.7 million, up from $8.6 million a year prior. However, the company reported a GAAP net loss of $(13.7) million in Q4 and $(94.7) million for the full year, despite positive non-GAAP earnings. The company also announced new AI product offerings leveraging GPT-3, further enhancing its portfolio.

Positive

• Q4 revenue increased 20% year-over-year to $208.3 million.
• LTM enterprise subscription revenue grew 32%.
• 2022 total revenue reached a record $778.8 million, up 28% from 2021.
• Operating cash flow was $32.7 million in Q4, significantly higher than $8.6 million in Q4 2021.
• Non-GAAP net income for Q4 was $39 million, up from $30.1 million in Q4 2021.
• International revenue grew 44% in 2022.

Negative

• GAAP net loss for Q4 was $(13.7) million, compared to $(3.6) million in Q4 2021.
• GAAP net loss for 2022 was $(94.7) million, compared to $(53.0) million in 2021.
• GAAP gross margin decreased to 52.8% in 2022 from 55.5% in 2021.

32% Growth in LTM Enterprise Subscription Revenue

44% Growth in 2022 International Revenue

Record Operating Cash Flow of $32.7 Million

SAN RAMON, Calif.--(BUSINESS WIRE)-- Five9, Inc. (NASDAQ:FIVN), a leading provider of cloud contact center software, today reported results for the fourth quarter and full year ended December 31, 2022.

Fourth Quarter 2022 Financial Results

• Revenue for the fourth quarter of 2022 increased 20% to a record $208.3 million, compared to $173.6 million for the fourth quarter of 2021.
• GAAP gross margin was 53.8% for the fourth quarter of 2022, compared to 54.1% for the fourth quarter of 2021.
• Adjusted gross margin was 62.3% for the fourth quarter of 2022, compared to 62.8% for the fourth quarter of 2021.
• GAAP net loss for the fourth quarter of 2022 was $(13.7) million, or $(0.19) per basic share, compared to GAAP net loss of $(3.6) million, or $(0.05) per basic share, for the fourth quarter of 2021.
• Non-GAAP net income for the fourth quarter of 2022 was $39.0 million, or $0.54 per diluted share, compared to non-GAAP net income of $30.1 million, or $0.42 per diluted share, for the fourth quarter of 2021.
• Adjusted EBITDA for the fourth quarter of 2022 was $46.2 million, or 22.2% of revenue, compared to $36.9 million, or 21.3% of revenue, for the fourth quarter of 2021.
• GAAP operating cash flow for the fourth quarter of 2022 was $32.7 million, compared to GAAP operating cash flow of $8.6 million for the fourth quarter of 2021.

2022 Financial Results

• Total revenue for 2022 increased 28% to a record $778.8 million, compared to $609.6 million in 2021.
• GAAP gross margin was 52.8% for 2022, compared to 55.5% in 2021.
• Adjusted gross margin was 61.3% for 2022, compared to 63.5% in 2021.
• GAAP net loss for 2022 was $(94.7) million, or $(1.35) per basic share, compared to GAAP net loss of $(53.0) million, or $(0.79) per basic share, in 2021.
• Non-GAAP net income for 2022 was $106.7 million, or $1.50 per diluted share, compared to non-GAAP net income of $82.2 million, or $1.16 per diluted share, in 2021.
• Adjusted EBITDA for 2022 was $140.4 million, or 18.0% of revenue, compared to $110.5 million, or 18.1% of revenue, in 2021.
• GAAP operating cash flow for 2022 was $88.9 million, compared to GAAP operating cash flow of $29.0 million, in 2021.

“We are pleased to report strong fourth quarter results with revenue growing 20% year-over-year to a record $208.3 million. This growth was driven by the continued strength of our Enterprise business where LTM subscription revenue grew 32% year-over-year. Our investments in international expansion are also paying off as our 2022 international revenue grew 44%. In the fourth quarter, we achieved another record for operating cash flow, driven by adjusted EBITDA margin reaching 22%. These financial results demonstrate our continuing long-term focus on delivering balanced growth. As we execute against a massive and underpenetrated opportunity, we continue to march up-market, expand internationally and deliver innovation. Speaking of which, we are excited to announce two new product offerings that leverage GPT-3 from OpenAI, namely AI Insights and AI Summaries. We have now expanded, what we believe to be the industry-leading AI & Automation portfolio, to include eight distinct modules with speech analytics, workflow automation, voice IVA, digital IVA, Agent Assist, Analytics and now AI Insights and AI Summaries. We believe these new offerings will play a central role in the future of the contact center and customer experience.”

- Mike Burkland, Chairman and CEO, Five9

Business Outlook

Five9 provides guidance based on current market conditions and expectations. Five9 emphasizes that the guidance is subject to various important cautionary factors referenced in the section entitled "Forward-Looking Statements" below, including risks and uncertainties associated with the ongoing macroeconomic deterioration.

• For the full year 2023, Five9 expects to report:
  • Revenue in the range of $900.0 to $903.0 million.
  • GAAP net loss per share in the range of $(1.72) to $(1.62), assuming diluted shares outstanding of approximately 72.1 million.
  • Non-GAAP net income per share in the range of $1.67 to $1.71, assuming diluted shares outstanding of approximately 73.4 million.
• For the first quarter of 2023, Five9 expects to report:
  • Revenue in the range of $207.0 to $208.0 million.
  • GAAP net loss per share in the range of $(0.63) to $(0.58), assuming diluted shares outstanding of approximately 71.2 million.
  • Non-GAAP net income per share in the range of $0.23 to $0.25, assuming diluted shares outstanding of approximately 72.2 million.

With respect to Five9’s guidance as provided above, please refer to the “Reconciliation of GAAP Net Loss to Non-GAAP net income – Guidance” table for more details, including important assumptions upon which such guidance is based.

Conference Call Details

Five9 will discuss its fourth quarter 2022 results today, February 22, 2023, via Zoom webinar at 4:30 p.m. Eastern Time. To access the webinar, please register by clicking here. A copy of this press release will be furnished to the Securities and Exchange Commission on a Current Report on Form 8-K and will be posted to our website, prior to the conference call.

A live webcast and a replay will be available on the Investor Relations section of the Company’s web-site at http://investors.five9.com/.

Non-GAAP Financial Measures

In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures. We calculate adjusted gross profit and adjusted gross margin by adding back the following items to gross profit: depreciation, intangibles amortization, stock-based compensation, exit costs related to the closure and relocation of our Russian operations, acquisition-related transaction and one-time integration costs, and refund for prior year overpayment of Universal Service Fund, or USF, fees. We calculate adjusted EBITDA by adding back or removing the following items to or from GAAP net loss: depreciation and amortization, stock-based compensation, interest expense, interest (income) and other, exit costs related to closure and relocation of our Russian operations, acquisition-related transaction costs and one-time integration costs, contingent consideration expense, refund for prior year overpayment of USF fees and provision for (benefit from) income taxes. We calculate non-GAAP operating income by adding back or removing the following items to or from GAAP loss from operations: stock-based compensation, intangibles amortization, exit costs related to the closure and relocation of our Russian operations, acquisition-related transaction and one-time integration costs, contingent consideration expense and refund for prior year overpayment of USF fees. We calculate non-GAAP net income by adding back or removing the following items to or from GAAP net loss: stock-based compensation, intangibles amortization, amortization of discount and issuance costs on convertible senior notes, exit costs related to the closure and relocation of our Russian operations, acquisition-related transaction costs and one-time integration costs, contingent consideration expense, refund for prior year overpayment of USF fees and tax provision associated with acquired companies. For the periods presented, these adjustments from GAAP net loss to non-GAAP net income do not include any presentation of the net tax effect of such adjustments given our significant net operating loss carryforwards. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies. The Company considers these non-GAAP financial measures to be important because they provide useful measures of the operating performance of the Company, exclusive of factors that do not directly affect what we consider to be our core operating performance, as well as unusual events. The Company’s management uses these measures to (i) illustrate underlying trends in the Company’s business that could otherwise be masked by the effect of income or expenses that are excluded from non-GAAP measures, and (ii) establish budgets and operational goals for managing the Company’s business and evaluating its performance. In addition, investors often use similar measures to evaluate the operating performance of a company. Non-GAAP financial measures are presented only as supplemental information for purposes of understanding the Company’s operating results. The non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP. Please see the reconciliation of non-GAAP financial measures set forth in this release.

Forward-Looking Statements

This news release contains certain forward-looking statements, including the statements in the quotes from our Chairman and Chief Executive Officer, including statements regarding Five9’s market opportunity and ability to capitalize on that opportunity, Five9's business strategies and market position, and the first quarter and full year 2023 financial projections set forth under the caption “Business Outlook,” that are based on our current expectations and involve numerous risks and uncertainties that may cause these forward-looking statements to be inaccurate. Risks that may cause these forward-looking statements to be inaccurate include, among others: (i) the impact of adverse economic conditions, including the impact of macroeconomic deterioration, including increased inflation, increased interest rates, supply chain disruptions, decreased economic output and fluctuations in currency rates, the impact of the Russia-Ukraine conflict, and other factors, that may continue to harm our business; (ii) if we are unable to attract new clients or sell additional services and functionality to our existing clients, our revenue and revenue growth will be harmed; (iii) if our existing clients terminate their subscriptions, reduce their subscriptions and related usage, or fail to grow subscriptions at the rate they have in the past or that we might expect, our revenues and gross margins will be harmed and we will be required to spend more money to grow our client base; (iv) because a significant percentage of our revenue is derived from existing clients, downturns or upturns in new sales will not be immediately reflected in our operating results and may be difficult to discern; (v) we have established, and are continuing to increase, our network of technology solution brokers and resellers to sell our solution; our failure to effectively develop, manage, and maintain this network could materially harm our revenues; (vi) our quarterly and annual results may fluctuate significantly, including as a result of the timing and success of new product and feature introductions by us, and may not fully reflect the underlying performance of our business and may result in decreases in the price of our common stock; (vii) our recent rapid growth may not be indicative of our future growth, and even if we continue to grow rapidly, we may fail to manage our growth effectively; (viii) our recent Chief Executive Officer transition could disrupt our operations, result in additional executive and personnel transitions and make it more difficult for us to hire and retain employees; (ix) failure to adequately retain and expand our sales force will impede our growth; (x) if we fail to manage our technical operations infrastructure, our existing clients may experience service outages, our new clients may experience delays in the deployment of our solution and we could be subject to, among other things, claims for credits or damages; (xi) our growth depends in part on the success of our strategic relationships with third parties and our failure to successfully maintain, grow and manage these relationships could harm our business; (xii) the markets in which we participate involve a high number of competitors that is continuing to increase, and if we do not compete effectively, our operating results could be harmed; (xiii) we continue to expand our international operations, which exposes us to significant macroeconomic and other risks; (xiv) security breaches and improper access to or disclosure of our data or our clients’ data, or other cyber attacks on our systems, could result in litigation and regulatory risk, harm our reputation and our business; (xv) we may acquire other companies or technologies, or be the target of strategic transactions, or be impacted by transactions by other companies, which could divert our management’s attention, result in additional dilution to our stockholders or use a significant amount of our cash resources and otherwise disrupt our operations and harm our operating results; (xvi) we sell our solution to larger organizations that require longer sales and implementation cycles and often demand more configuration and integration services or customized features and functions that we may not offer, any of which could delay or prevent these sales and harm our growth rates, business and operating results; (xvii) we rely on third-party telecommunications and internet service providers to provide our clients and their customers with telecommunication services and connectivity to our cloud contact center software and any failure by these service providers to provide reliable services could cause us to lose clients and subject us to claims for credits or damages, among other things; (xviii) we have a history of losses and we may be unable to achieve or sustain profitability; (xix) the contact center software solutions market is subject to rapid technological change, and we must develop and sell incremental and new cloud contact center solutions, which we refer to as our solution, in order to maintain and grow our business; (xx) our stock price has been volatile, may continue to be volatile and may decline, including due to factors beyond our control; (xxi) we may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs; (xxii) failure to comply with laws and regulations could harm our business and our reputation; (xxiii) we may not have sufficient cash to service our convertible senior notes and repay such notes, if required, and other risks attendant to our convertible senior notes and increased debt levels; and (xxiv) the other risks detailed from time-to-time under the caption “Risk Factors” and elsewhere in our Securities and Exchange Commission filings and reports, including, but not limited to, our most recent annual report on Form 10-K and quarterly reports on Form 10-Q. Such forward-looking statements speak only as of the date hereof and readers should not unduly rely on such statements. We undertake no obligation to update the information contained in this press release, including in any forward-looking statements.

About Five9

Five9 is a leading provider of cloud contact center software for the intelligent contact center space, bringing the power of cloud innovation to customers. Five9 provides end-to-end solutions with omnichannel routing, analytics, WFO and AI to increase agent productivity and deliver tangible business results. The Five9 Genius platform is reliable, secure, compliant and scalable; designed to create exceptional personalized customer experiences. For more information, visit www.five9.com.

FIVE9, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited)
		December 31, 2022				December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents		$	180,520			$	90,878
Marketable investments			433,743				378,980
Accounts receivable, net			87,494				83,731
Prepaid expenses and other current assets			29,711				30,342
Deferred contract acquisition costs, net			47,242				33,295
Total current assets			778,710				617,226
Property and equipment, net			101,221				77,785
Operating lease right-of-use assets			44,120				48,703
Intangible assets, net			28,192				39,897
Goodwill			165,420				165,420
Marketable investments			885				147,377
Other assets			11,057				11,871
Deferred contract acquisition costs, net — less current portion			114,880				84,663
Total assets		$	1,244,485			$	1,192,942
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	23,629			$	20,510
Accrued and other current liabilities			53,092				78,577
Operating lease liabilities			10,626				9,826
Accrued federal fees			2,471				2,282
Sales tax liabilities			2,973				2,660
Deferred revenue			57,816				43,720
Convertible senior notes			169				—
Total current liabilities			150,776				157,575
Convertible senior notes — less current portion			738,376				768,599
Sales tax liabilities — less current portion			899				877
Operating lease liabilities — less current portion			41,389				47,088
Other long-term liabilities			3,080				7,671
Total liabilities			934,520				981,810
Stockholders’ equity:
Common stock			71				68
Additional paid-in capital			635,668				439,787
Accumulated other comprehensive loss			(2,688	)			(287	)
Accumulated deficit			(323,086	)			(228,436	)
Total stockholders’ equity			309,965				211,132
Total liabilities and stockholders’ equity		$	1,244,485			$	1,192,942

FIVE9, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited)
		Three Months Ended								Twelve Months Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Revenue		$	208,345			$	173,599			$	778,846			$	609,591
Cost of revenue			96,294				79,764				367,501				271,099
Gross profit			112,051				93,835				411,345				338,492
Operating expenses:
Research and development			36,865				30,448				141,794				106,897
Sales and marketing			65,928				53,394				261,990				193,929
General and administrative			22,509				21,972				95,143				93,916
Total operating expenses			125,302				105,814				498,927				394,742
Loss from operations			(13,251	)			(11,979	)			(87,582	)			(56,250	)
Other income (expense), net:
Interest expense			(1,887	)			(2,024	)			(7,493	)			(8,027	)
Interest income and other income (expense)			2,706				(43	)			4,813				(8	)
Total other income (expense), net			819				(2,067	)			(2,680	)			(8,035	)
Loss before income taxes			(12,432	)			(14,046	)			(90,262	)			(64,285	)
Provision for (benefit from) income taxes			1,221				(10,445	)			4,388				(11,285	)
Net loss		$	(13,653	)		$	(3,601	)		$	(94,650	)		$	(53,000	)
Net loss per share:
Basic and diluted		$	(0.19	)		$	(0.05	)		$	(1.35	)		$	(0.79	)
Shares used in computing net loss per share:
Basic and diluted			70,704				68,207				69,920				67,512

FIVE9, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)
		Twelve Months Ended
		December 31, 2022				December 31, 2021
Cash flows from operating activities:
Net loss		$	(94,650	)		$	(53,000	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization			44,671				38,732
Amortization of operating lease right-of-use assets			10,377				8,698
Amortization of deferred contract acquisition costs			41,034				26,050
Amortization of premium on marketable investments			(90	)			6,385
Provision for doubtful accounts			1,105				808
Stock-based compensation			172,507				108,805
Amortization of discount and issuance costs on convertible senior notes			3,743				3,957
Deferred taxes			3,088				(6,907	)
Change in fair of value of contingent consideration			260				5,640
Payment of contingent consideration liability in excess of acquisition-date fair value			(5,900	)			—
Other			188				396
Changes in operating assets and liabilities:
Accounts receivable			(4,899	)			(35,986	)
Prepaid expenses and other current assets			661				(14,193	)
Deferred contract acquisition costs			(85,197	)			(71,380	)
Other assets			(319	)			(1,216	)
Accounts payable			845				4,305
Accrued and other current liabilities			(8,379	)			20,562
Accrued federal fees and sales tax liability			524				(497	)
Deferred revenue			13,176				10,462
Other liabilities			(3,880	)			(22,623	)
Net cash provided by operating activities			88,865				28,998
Cash flows from investing activities:
Purchases of marketable investments			(435,768	)			(680,490	)
Proceeds from sales of marketable investments			600				44,288
Proceeds from maturities of marketable investments			524,568				527,940
Purchases of property and equipment			(52,272	)			(42,216	)
Capitalization of software development costs			(3,899	)			—
Payments of initial direct costs			(266	)			—
Cash paid for an equity investment in a privately-held company			(2,000	)			—
Net cash provided by (used in) investing activities			30,963				(150,478	)
Cash flows from financing activities:
Repurchase of a portion of 2023 convertible senior notes, net of costs			(34,067	)			(24,688	)
Proceeds from exercise of common stock options			8,522				7,402
Proceeds from sale of common stock under ESPP			13,413				15,397
Payment of contingent consideration liability up to acquisition-date fair value			(18,100	)			—
Payment of holdbacks related to acquisitions			—				(5,000	)
Payments of finance leases			—				(612	)
Net cash used in financing activities			(30,232	)			(7,501	)
Net increase (decrease) in cash and cash equivalents			89,596				(128,981	)
Cash, cash equivalents and restricted cash:
Beginning of period			91,391				220,372
End of period		$	180,987			$	91,391

FIVE9, INC. RECONCILIATION OF GAAP GROSS PROFIT TO ADJUSTED GROSS PROFIT (In thousands, except percentages) (Unaudited)
		Three Months Ended								Twelve Months Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
GAAP gross profit		$	112,051			$	93,835			$	411,345			$	338,492
GAAP gross margin			53.8	%			54.1	%			52.8	%			55.5	%
Non-GAAP adjustments:
Depreciation			5,913				5,354				23,250				19,083
Intangibles amortization			2,890				2,947				11,705				11,787
Stock-based compensation			8,638				6,854				33,297				17,734
Exit costs related to closure and relocation of Russian operations			219				—				698				—
Acquisition-related and one-time integration costs			86				43				401				112
Refund for prior year overpayment of USF fees			—				—				(3,511	)			—
Adjusted gross profit		$	129,797			$	109,033			$	477,185			$	387,208
Adjusted gross margin			62.3	%			62.8	%			61.3	%			63.5	%

FIVE9, INC. RECONCILIATION OF GAAP NET LOSS TO ADJUSTED EBITDA (In thousands, except percentages) (Unaudited)
		Three Months Ended								Twelve Months Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
GAAP net loss		$	(13,653	)		$	(3,601	)		$	(94,650	)		$	(53,000	)
Non-GAAP adjustments:
Depreciation and amortization			11,021				10,538				44,671				38,732
Stock-based compensation			43,824				35,601				172,507				108,805
Interest expense			1,887				2,024				7,493				8,027
Interest (income) and other			(2,706	)			43				(4,813	)			8
Exit costs related to closure and relocation of Russian operations (1)			2,975				—				7,190				—
Acquisition related transaction costs and one-time integration costs			1,605				2,351				6,901				13,576
Contingent consideration expense			—				380				260				5,640
Refund for prior year overpayment of USF fees			—				—				(3,511	)			—
Provision for (benefit from) income taxes			1,221				(10,445	)			4,388				(11,285	)
Adjusted EBITDA		$	46,174			$	36,891			$	140,436			$	110,503
Adjusted EBITDA as % of revenue			22.2	%			21.3	%			18.0	%			18.1	%

(1) Exit costs related to the closure of our Russian operations was $-0- million and $3.4 million, respectively, during the three and twelve months ended December 31, 2022. One-time and relocation-related costs was $3.3 million and $4.5 million, respectively, during the three and twelve months ended December 31, 2022. The $3.0 million and $7.2 million adjustments presented above were net of $0.0 million and $0.8 million included in “Depreciation and amortization” and $(0.3) million and $(0.1) million included in “Interest (income) and other.”

FIVE9, INC. RECONCILIATION OF GAAP OPERATING LOSS TO NON-GAAP OPERATING INCOME (In thousands) (Unaudited)
		Three Months Ended								Twelve Months Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Loss from operations		$	(13,251	)		$	(11,979	)		$	(87,582	)		$	(56,250	)
Non-GAAP adjustments:
Stock-based compensation			43,824				35,601				172,507				108,805
Intangibles amortization			2,890				2,947				11,705				11,787
Exit costs related to closure and relocation of Russian operations			2,975				—				7,964				—
Acquisition-related transaction and one-time integration costs			1,605				2,351				6,901				13,576
Contingent consideration expense			—				380				260				5,640
Refund for prior year overpayment of USF fees			—				—				(3,511	)			—
Non-GAAP operating income		$	38,043			$	29,300			$	108,244			$	83,558

FIVE9, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET INCOME (In thousands, except per share data) (Unaudited)
		Three Months Ended								Twelve Months Ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
GAAP net loss		$	(13,653	)		$	(3,601	)		$	(94,650	)		$	(53,000	)
Non-GAAP adjustments:
Stock-based compensation			43,824				35,601				172,507				108,805
Intangibles amortization			2,890				2,947				11,705				11,787
Amortization of discount and issuance costs on convertible senior notes			947				997				3,743				3,957
Exit costs related to closure and relocation of Russian operations			3,344				—				7,932				—
Acquisition-related transaction and one-time integration costs			1,605				2,351				6,901				13,576
Contingent consideration expense			—				380				260				5,640
Refund for prior year overpayment of USF fees			—				—				(3,511	)			—
Tax provision associated with acquired companies			—				(8,573	)			1,830				(8,573	)
Non-GAAP net income		$	38,957			$	30,102			$	106,717			$	82,192
GAAP net loss per share:
Basic and diluted		$	(0.19	)		$	(0.05	)		$	(1.35	)		$	(0.79	)
Non-GAAP net income per share:
Basic		$	0.55			$	0.44			$	1.53			$	1.22
Diluted		$	0.54			$	0.42			$	1.50			$	1.16
Shares used in computing GAAP net loss per share:
Basic and diluted			70,704				68,207				69,920				67,512
Shares used in computing non-GAAP net income per share:
Basic			70,704				68,207				69,920				67,512
Diluted			71,537				70,878				71,229				70,735

FIVE9, INC. SUMMARY OF STOCK-BASED COMPENSATION, DEPRECIATION AND INTANGIBLES AMORTIZATION (In thousands) (Unaudited)
		Three Months Ended
		December 31, 2022									December 31, 2021
		Stock-Based Compensation			Depreciation			Intangibles Amortization			Stock-Based Compensation			Depreciation			Intangibles Amortization
Cost of revenue		$	8,638		$	5,913		$	2,890		$	6,854		$	5,354		$	2,947
Research and development			11,799			768			—			9,163			948			—
Sales and marketing			15,152			1			—			11,987			1			—
General and administrative			8,235			1,449			—			7,597			1,288			—
Total		$	43,824		$	8,131		$	2,890		$	35,601		$	7,591		$	2,947
		Twelve Months Ended
		December 31, 2022									December 31, 2021
		Stock-Based Compensation			Depreciation			Intangibles Amortization			Stock-Based Compensation			Depreciation			Intangibles Amortization
Cost of revenue		$	33,297		$	23,250		$	11,705		$	17,734		$	19,083		$	11,787
Research and development			44,367			3,164			—			29,179			3,277			—
Sales and marketing			59,300			4			—			35,269			4			—
General and administrative			35,543			6,548			—			26,623			4,581			—
Total		$	172,507		$	32,966		$	11,705		$	108,805		$	26,945		$	11,787

FIVE9, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET INCOME – GUIDANCE(1) (In thousands, except per share data) (Unaudited)
		Three Months Ending								Year Ending
		March 31, 2023								December 31, 2023
		Low				High				Low				High
GAAP net loss		$	(44,909	)		$	(40,965	)		$	(123,994	)		$	(116,558	)
Non-GAAP adjustments:
Stock-based compensation(2)			54,742				52,742				225,427				221,427
Intangibles amortization			2,884				2,884				11,537				11,537
Amortization of discount and issuance costs on convertible senior notes			908				908				3,749				3,749
Exit costs related to closure and relocation of Russian operations			1,045				1,045				3,975				3,975
Acquisition-related transaction and one-time integration costs(3)			1,936				1,436				1,936				1,436
Income tax expense effects(4)			—				—				—				—
Non-GAAP net income		$	16,606			$	18,050			$	122,630			$	125,566
GAAP net loss per share, basic and diluted		$	(0.63	)		$	(0.58	)		$	(1.72	)		$	(1.62	)
Non-GAAP net income per share:
Basic		$	0.23			$	0.25			$	1.70			$	1.74
Diluted		$	0.23			$	0.25			$	1.67			$	1.71
Shares used in computing GAAP net loss per share and non-GAAP net income per share:
Basic			71,200				71,200				72,100				72,100
Diluted			72,200				72,200				73,400				73,400

(1)		Represents guidance discussed on February 22, 2023. Reader shall not construe presentation of this information after February 22, 2023 as an update or reaffirmation of such guidance.
(2)		Stock-based compensation expenses are based on a range of probable significance, assuming market price for our common stock that is approximately consistent with current levels.
(3)		Acquisition-related one-time integration costs are based on a range of probable significance for completed acquisitions, and no new acquisitions are assumed.
(4)		Non-GAAP adjustments do not have an impact on our income tax provision due to past non-GAAP losses.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230222005613/en/

Investor Relations Contacts:

Five9, Inc.

Barry Zwarenstein

Chief Financial Officer

925-201-2000 ext. 5959

IR@five9.com

The Blueshirt Group for Five9, Inc.

Lisa Laukkanen

415-217-4967

Lisa@blueshirtgroup.com

Source: Five9, Inc.

FAQ

What were Five9's Q4 2022 revenue results?

Five9 reported Q4 2022 revenue of $208.3 million, a 20% increase from Q4 2021.

How much did Five9's enterprise subscription revenue grow in 2022?

Enterprise subscription revenue grew by 32% year-over-year.

What was Five9's total revenue for the full year 2022?

Total revenue for 2022 reached a record $778.8 million, up 28% from 2021.

What was the GAAP net loss for Five9 in Q4 2022?

The GAAP net loss for Q4 2022 was $(13.7) million.

How did Five9's operating cash flow perform in Q4 2022?

GAAP operating cash flow for Q4 2022 was $32.7 million, compared to $8.6 million in Q4 2021.

What new products did Five9 announce leveraging GPT-3?

Five9 announced two new products: AI Insights and AI Summaries.