Grid Dynamics Reports Fourth Quarter and Full Year 2023 Financial Results
- Exceeded fourth quarter revenue outlook with $78.1 million and full-year revenue of $312.9 million in 2023.
- Achieved growth in various verticals, including Technology, Media, and Telecom, Finance, and Other verticals.
- Non-GAAP net income was $5.7 million for the fourth quarter, with total cash flow of $41.1 million for the year.
- Expecting revenue in the first quarter of 2024 to be between $77 million to $79 million, focusing on digital transformation and industry diversification.
- None.
Insights
The reported fourth quarter revenue of $78.1 million and full year revenue of $312.9 million by Grid Dynamics Holdings, Inc. indicates a marginal increase from the previous year's revenue, suggesting a stable but slow growth trajectory for the company. The slight uptick in annual revenue, from $310.5 million in 2022 to $312.9 million in 2023, reflects a conservative year-over-year growth rate of 0.8%. This may signal to stakeholders that while the company is maintaining revenue streams, it is not achieving significant growth in a highly competitive digital transformation industry.
Furthermore, the diversification of the company's industry mix, with a decreased reliance on the Retail vertical, could be seen as a strategic move to mitigate risk and capitalize on growth opportunities across various sectors. The Finance vertical's growth of 13.4% and the TMT vertical's growth of 1.9% on a sequential basis are positive indicators of the company's successful penetration into these markets. However, the unchanged revenue in the CPG and Manufacturing vertical could point to potential stagnation or market saturation in that segment.
Grid Dynamics' expansion in India, with the opening of a third office in Bengaluru, aligns with the company's strategy to leverage a 'follow-the-sun' model for global delivery. This could enhance their appeal to enterprise clients by providing round-the-clock services and tapping into the skilled workforce in the region. Nevertheless, the impact of this expansion on the company's bottom line will be important to monitor in subsequent quarters.
The reported GAAP net income of $2.9 million in Q4 2023, a shift from a net loss of $6.7 million in Q4 2022, is a significant turnaround for Grid Dynamics. This improvement in profitability, despite flat sequential quarterly revenue and a year-over-year decrease, is notable. The increase in GAAP gross profit margin to 36.0% from the previous year's 40.1% may raise concerns about cost management and pricing power within the industry.
The company's Non-GAAP measures, such as EBITDA, which decreased from $16.5 million in Q4 2022 to $10.7 million in Q4 2023 and Non-GAAP net income, which also saw a decline from $10.5 million to $5.7 million, suggest that while the company is profitable on a non-GAAP basis, it is experiencing pressure on its earnings. Investors could view these mixed financial results with caution, balancing the positive net income against the context of declining profitability metrics.
The financial outlook for Q1 2024, with expected revenue between $77 million and $79 million and Non-GAAP EBITDA between $9.5 million and $10.5 million, provides a conservative forecast. This guidance, alongside the inability to provide GAAP net income targets due to unpredictable items, may introduce an element of uncertainty regarding the company's future financial performance.
The emphasis on AI across all industry practices and the recognition by major hyperscalers for AI capabilities could position Grid Dynamics as a strong player in the digital transformation space. The strategic partnerships that influenced 13% of the company's total revenue in 2023 underscore the importance of alliances in driving business growth. This focus on AI and technical skills is critical as businesses increasingly seek to integrate AI into their operations to drive innovation and efficiency.
The company's performance in the Technology, Media and Telecom (TMT) vertical, as well as the addition of new enterprise logos including a large insurance company and a healthcare company, suggests Grid Dynamics is expanding its footprint and is becoming a more integral part of the digital strategy for diverse industries. This diversification could serve as a buffer against market volatility and sector-specific downturns.
However, the flat revenue in the CPG and Manufacturing vertical might indicate a need for renewed strategies to stimulate growth in these areas. Additionally, the company's expansion in India suggests an investment in global talent and an attempt to optimize cost structures, which could be crucial in maintaining competitive pricing and operational efficiency in a rapidly evolving tech landscape.
Fourth Quarter Revenue of
We are very pleased to report revenue of
“I am pleased to report that the demand environment is improving and this should favorably support our business in 2024. There were many positives in this quarter. We added five new enterprise logos. Notable inclusions were a large insurance company and a healthcare company. AI is now infused across all of our industry practices, with many new customers embracing AI in their solutions. Customers recognize Grid Dynamics engineering quality in
The last twelve months have proven that the company is adept in navigating uncertainties as we executed across multiple areas of our business. In 2023 we added 33 enterprise customers, scaled our delivery locations across
Fourth Quarter of 2023 Financial Highlights
-
Total revenue was
$78.1 million 3.1% year-over-year. -
GAAP gross profit was
$28.1 million 36.0% of revenue, compared to GAAP gross profit of$32.3 million 40.1% of revenue in the fourth quarter of 2022. Non-GAAP gross profit was$28.6 million 36.6% of revenue, compared to Non-GAAP gross profit of$32.7 million 40.6% of revenue in the fourth quarter of 2022. -
GAAP net income attributable to common stockholders was
$2.9 million $0.04 $6.7 million $(0.09) $0.04 $(0.09) $5.7 million $0.07 $10.5 million $0.14 -
Non-GAAP EBITDA (earnings before interest, taxes, depreciation, amortization, other income, fair value adjustments, stock-based compensation, and transaction and transformation-related costs as well as geographic reorganization expenses), a Non-GAAP metric, was
$10.7 million $16.5 million
2023 Full Year Financial Highlights
-
Total revenue was
$312.9 million 0.8% year-over-year. -
GAAP gross profit was
$113.1 million 36.2% of revenue, compared to GAAP gross profit of$120.6 million 38.8% of revenue in 2022. Non-GAAP gross profit was$115.1 million 36.8% of revenue, compared to Non-GAAP gross profit of$121.9 million 39.3% of revenue in 2022. -
GAAP net loss attributable to common stockholders was
$1.8 million $(0.02) $29.2 million $(0.42) $25.1 million $0.32 $36.6 million $0.51 -
Non-GAAP EBITDA (earnings before interest, taxes, depreciation, amortization, other income, fair value adjustments, stock-based compensation, and transaction and transformation-related costs as well as geographic reorganization expenses), a Non-GAAP metric, was
$44.2 million $58.2 million
See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Information” below for a discussion of our non-GAAP measures.
Cash Flow and Other Metrics
-
Cash provided by operating activities was
$41.1 million $31.7 million -
Cash and cash equivalents totaled
$257.2 million $256.7 million - Total headcount was 3,920 as of December 31, 2023, compared with 3,798 employees as of December 31, 2022.
Financial Outlook
-
The Company expects revenue in the first quarter of 2024 to be in the range of
$77 million $79 million -
Non-GAAP EBITDA in the first quarter of 2024 is expected to be between
$9.5 million $10.5 million - For the first quarter of 2024, we expect our basic share count to be in the 76.5-77.5 million range and diluted share count to be in the 78.5-79.5 million range.
Grid Dynamics is not able, at this time, to provide GAAP targets for net income for the first quarter of 2024 because of the difficulty of estimating certain items excluded from non-GAAP EBITDA that cannot be reasonably predicted, such as interest, taxes, other income, fair-value adjustments, geographic reorganization expenses, and charges related to stock-based compensation expense. The effect of these excluded items may be significant.
Conference Call and Webcast
Grid Dynamics will host a conference call at 4:30 p.m. ET on Thursday, February 22, 2024 to discuss its fourth quarter and full year 2023 financial results. Investors and other interested parties can access the call in the following ways: A webcast of the video conference call can be accessed on the Investor Relations section of the Company's website at https://ir.griddynamics.com/.
A replay will also be available after the call at https://ir.griddynamics.com/ with the passcode $Q4@2023.
About Grid Dynamics
Grid Dynamics (NASDAQ: GDYN) is a leading provider of technology consulting, platform and product engineering, and advanced analytics services. Fusing technical vision with business acumen, we enable positive business outcomes for enterprise companies undergoing business transformation by solving their most pressing technical challenges. A key differentiator for Grid Dynamics is our 7+ years of experience and leadership in enterprise AI, supported by profound expertise and ongoing investment in data, analytics, cloud & DevOps, application modernization, and customer experience. Founded in 2006, Grid Dynamics is headquartered in Silicon Valley with offices across the
Non-GAAP Financial Measures
To supplement the financial measures presented in Grid Dynamics press release in accordance with generally accepted accounting principles in
A “non-GAAP financial measure” refers to a numerical measure of Grid Dynamics historical or future financial performance or financial position that is included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. Grid Dynamics provides certain non-GAAP measures as additional information relating to its operating results as a complement to results provided in accordance with GAAP. The non-GAAP financial information presented herein should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP and should not be considered a measure of liquidity and profitability.
Grid Dynamics has included these non-GAAP financial measures because they are financial measures used by Grid Dynamics’ management to evaluate Grid Dynamics’ core operating performance and trends, to make strategic decisions regarding the allocation of capital and new investments and are among the factors analyzed in making performance-based compensation decisions for key personnel.
Grid Dynamics believes the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are either not part of core operations or do not require a cash outlay, such as stock-based compensation expense. Grid Dynamics believes these non-GAAP measures provide investors and other users of its financial information consistency and comparability with its past financial performance and facilitate period to period comparisons of operations. Grid Dynamics believes these non-GAAP measures are useful in evaluating its operating performance compared to that of other companies in its industry, as they generally eliminate the effects of certain items that may vary for different companies for reasons unrelated to overall operating performance.
There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies. Grid Dynamics compensates for these limitations by providing investors and other users of its financial information a reconciliation of non-GAAP measures to the related GAAP financial measures. Grid Dynamics encourages investors and others to review its financial information in its entirety, not to rely on any single financial measure, and to view its non-GAAP measures in conjunction with GAAP financial measures. Please see the reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures attached to this release.
Forward-Looking Statements
This communication 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 that are not historical facts, and involve risks and uncertainties that could cause actual results of Grid Dynamics to differ materially from those expected and projected. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include, without limitation, the quotations of management, the section titled “Financial Outlook,” and statements concerning Grid Dynamics’s expectations with respect to future performance, particularly in light of the macroeconomic environment and the Russian invasion of
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside Grid Dynamics’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (i) Grid Dynamics has a relatively short operating history and operates in a rapidly evolving industry, which makes it difficult to evaluate future prospects and may increase the risk that it will not continue to be successful and may adversely impact our stock price; (ii) Grid Dynamics may be unable to effectively manage its growth or achieve anticipated growth, particularly as it expands into new geographies, which could place significant strain on Grid Dynamics’ management personnel, systems and resources; (iii) Grid Dynamics’ revenues are highly dependent on a limited number of clients and industries that are affected by seasonal trends, and any decrease in demand for outsourced services in these industries may reduce Grid Dynamics’ revenues and adversely affect Grid Dynamics’ business, financial condition and results of operations; (iv) macroeconomic conditions, inflationary pressures, and the geopolitical climate, including the Russian invasion of
Grid Dynamics cautions that the foregoing list of factors is not exclusive. Grid Dynamics cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Grid Dynamics does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Further information about factors that could materially affect Grid Dynamics, including its results of operations and financial condition, is set forth under the “Risk Factors” section of the Company’s quarterly report on Form 10-Q filed November 2, 2023 and in other periodic filings Grid Dynamics makes with the SEC.
Schedule 1: |
|||||||||||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME/(LOSS) AND |
|||||||||||||||
COMPREHENSIVE INCOME/(LOSS) |
|||||||||||||||
Unaudited |
|||||||||||||||
(In thousands, except per share data) |
|||||||||||||||
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
78,069 |
|
|
$ |
80,576 |
|
|
$ |
312,910 |
|
|
$ |
310,482 |
|
Cost of revenue |
|
49,955 |
|
|
|
48,296 |
|
|
|
199,764 |
|
|
|
189,892 |
|
Gross profit |
|
28,114 |
|
|
|
32,280 |
|
|
|
113,146 |
|
|
|
120,590 |
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses |
|
|
|
|
|
|
|
||||||||
Engineering, research, and development |
|
3,863 |
|
|
|
4,697 |
|
|
|
14,741 |
|
|
|
15,772 |
|
Sales and marketing |
|
6,422 |
|
|
|
5,377 |
|
|
|
24,151 |
|
|
|
19,808 |
|
General and administrative |
|
18,894 |
|
|
|
27,818 |
|
|
|
79,834 |
|
|
|
106,018 |
|
Total operating expenses |
|
29,179 |
|
|
|
37,892 |
|
|
|
118,726 |
|
|
|
141,598 |
|
|
|
|
|
|
|
|
|
||||||||
Loss from operations |
|
(1,065 |
) |
|
|
(5,612 |
) |
|
|
(5,580 |
) |
|
|
(21,008 |
) |
Other income/(expenses), net |
|
2,569 |
|
|
|
431 |
|
|
|
10,418 |
|
|
|
555 |
|
Income/(loss) before income taxes |
|
1,504 |
|
|
|
(5,181 |
) |
|
|
4,838 |
|
|
|
(20,453 |
) |
Provision for/(benefit from) income taxes |
|
(1,398 |
) |
|
|
1,521 |
|
|
|
6,603 |
|
|
|
8,761 |
|
Net income/(loss) |
$ |
2,902 |
|
|
$ |
(6,702 |
) |
|
$ |
(1,765 |
) |
|
$ |
(29,214 |
) |
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
785 |
|
|
|
1,215 |
|
|
|
2,122 |
|
|
|
(722 |
) |
Comprehensive income/(loss) |
$ |
3,687 |
|
|
$ |
(5,487 |
) |
|
$ |
357 |
|
|
$ |
(29,936 |
) |
|
|
|
|
|
|
|
|
||||||||
Income/(loss) per share |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.04 |
|
|
$ |
(0.09 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.42 |
) |
Diluted |
$ |
0.04 |
|
|
$ |
(0.09 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.42 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding |
|
|
|
|
|
|
|
||||||||
Basic |
|
75,690 |
|
|
|
74,036 |
|
|
|
75,193 |
|
|
|
69,197 |
|
Diluted |
|
78,033 |
|
|
|
74,036 |
|
|
|
75,193 |
|
|
|
69,197 |
|
Schedule 2: |
|||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
Unaudited |
|||||||
(In thousands, except share and per share data) |
|||||||
|
As of |
||||||
|
December 31,
|
|
December 31,
|
||||
Assets |
|
|
|
||||
Current assets |
|
|
|
||||
Cash and cash equivalents |
$ |
257,227 |
|
|
$ |
256,729 |
|
Accounts receivable, net of allowance of |
|
49,824 |
|
|
|
48,358 |
|
Unbilled receivables |
|
3,735 |
|
|
|
5,591 |
|
Prepaid income taxes |
|
3,998 |
|
|
|
4,294 |
|
Prepaid expenses and other current assets |
|
9,196 |
|
|
|
8,154 |
|
Total current assets |
|
323,980 |
|
|
|
323,126 |
|
|
|
|
|
||||
Property and equipment, net |
|
11,358 |
|
|
|
8,215 |
|
Operating lease right-of-use assets, net |
|
10,446 |
|
|
|
7,694 |
|
Intangible assets, net |
|
26,546 |
|
|
|
20,375 |
|
Goodwill |
|
53,868 |
|
|
|
45,514 |
|
Deferred tax assets |
|
6,418 |
|
|
|
4,998 |
|
Other noncurrent assets |
|
2,549 |
|
|
|
1,224 |
|
Total assets |
$ |
435,165 |
|
|
$ |
411,146 |
|
|
|
|
|
||||
Liabilities and equity |
|
|
|
||||
Current liabilities |
|
|
|
||||
Accounts payable |
$ |
3,621 |
|
|
$ |
3,897 |
|
Accrued compensation and benefits |
|
19,263 |
|
|
|
13,065 |
|
Accrued income taxes |
|
8,828 |
|
|
|
10,718 |
|
Operating lease liabilities, current |
|
4,235 |
|
|
|
2,505 |
|
Accrued expenses and other current liabilities |
|
6,276 |
|
|
|
8,525 |
|
Total current liabilities |
|
42,223 |
|
|
|
38,710 |
|
|
|
|
|
||||
Deferred tax liabilities |
|
3,274 |
|
|
|
3,756 |
|
Operating lease liabilities, noncurrent |
|
6,761 |
|
|
|
5,636 |
|
Total liabilities |
$ |
52,258 |
|
|
$ |
48,102 |
|
|
|
|
|
||||
Stockholders’ equity |
|
|
|
||||
Common stock, |
$ |
8 |
|
|
$ |
7 |
|
Additional paid-in capital |
|
397,511 |
|
|
|
378,006 |
|
Accumulated deficit |
|
(15,886 |
) |
|
|
(14,121 |
) |
Accumulated other comprehensive income/(loss) |
|
1,274 |
|
|
|
(848 |
) |
Total stockholders’ equity |
|
382,907 |
|
|
|
363,044 |
|
Total liabilities and stockholders’ equity |
$ |
435,165 |
|
|
$ |
411,146 |
|
Schedule 3: |
|||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
Unaudited |
|||||||
(In thousands) |
|||||||
|
Twelve Months Ended
|
||||||
|
|
2023 |
|
|
|
2022 |
|
Cash flows from operating activities |
|
|
|
||||
Net loss |
$ |
(1,765 |
) |
|
$ |
(29,214 |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
8,926 |
|
|
|
6,626 |
|
Operating lease right-of-use assets amortization expense |
|
3,192 |
|
|
|
3,021 |
|
Bad debt expense |
|
945 |
|
|
|
132 |
|
Deferred income taxes |
|
(4,140 |
) |
|
|
(3,633 |
) |
Change in fair value of contingent consideration |
|
(4,220 |
) |
|
|
— |
|
Stock-based compensation |
|
35,516 |
|
|
|
60,968 |
|
Other expenses |
|
324 |
|
|
|
71 |
|
Changes in assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(434 |
) |
|
|
(8,738 |
) |
Unbilled receivables |
|
2,518 |
|
|
|
(1,116 |
) |
Prepaid income taxes |
|
435 |
|
|
|
(3,450 |
) |
Prepaid expenses and other assets |
|
(511 |
) |
|
|
(3,371 |
) |
Accounts payable |
|
(538 |
) |
|
|
1,729 |
|
Accrued compensation and benefits |
|
5,260 |
|
|
|
1,694 |
|
Operating lease liabilities |
|
(3,135 |
) |
|
|
(2,574 |
) |
Accrued income taxes |
|
(2,271 |
) |
|
|
8,525 |
|
Accrued expenses and other current liabilities |
|
991 |
|
|
|
982 |
|
Net cash provided by operating activities |
|
41,093 |
|
|
|
31,652 |
|
Cash flows from investing activities |
|
|
|
||||
Purchase of property and equipment |
|
(7,870 |
) |
|
|
(6,069 |
) |
Purchase of investments |
|
(250 |
) |
|
|
(1,000 |
) |
Acquisition of business, net of cash acquired |
|
(17,830 |
) |
|
|
(9,254 |
) |
Net cash used in investing activities |
|
(25,950 |
) |
|
|
(16,323 |
) |
Cash flows from financing activities |
|
|
|
||||
Payments of tax obligations resulted from net share settlement of vested stock awards |
|
(16,831 |
) |
|
|
(5,755 |
) |
Proceeds from exercises of stock options, net of shares withheld for taxes |
|
510 |
|
|
|
1,432 |
|
Proceeds from issuance of Common Stock from 2022 and 2021 Offerings |
|
— |
|
|
|
109,537 |
|
Proceeds from debt |
|
— |
|
|
|
5,000 |
|
Payment of contingent consideration related to previously acquired businesses |
|
— |
|
|
|
(6,933 |
) |
Repayment of debt |
|
— |
|
|
|
(5,000 |
) |
Debt issuance cost |
|
— |
|
|
|
(270 |
) |
Equity issuance costs |
|
— |
|
|
|
(253 |
) |
Net cash (used in)/provided by financing activities |
|
(16,321 |
) |
|
|
97,758 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
1,676 |
|
|
|
(722 |
) |
Net increase in cash and cash equivalents |
|
498 |
|
|
|
112,365 |
|
Cash and cash equivalents, beginning of period |
|
256,729 |
|
|
|
144,364 |
|
Cash and cash equivalents, end of period |
$ |
257,227 |
|
|
$ |
256,729 |
|
Schedule 3: |
|||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
Unaudited |
|||||||
(In thousands) |
|||||||
(Continued) |
|||||||
|
Twelve Months Ended
|
||||||
|
|
2023 |
|
|
|
2022 |
|
Supplemental disclosure of cash flow information: |
|
|
|
||||
Cash paid for income taxes |
$ |
12,365 |
|
$ |
7,474 |
||
Supplemental disclosure of non-cash activities |
|
|
|
||||
Acquisition fair value of contingent consideration issued for acquisition of business |
$ |
932 |
|
|
$ |
3,288 |
|
Schedule 4: |
|||||||||||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||||||||||
RECONCILIATION OF NON-GAAP INFORMATION |
|||||||||||||||
Unaudited |
|||||||||||||||
(In thousands, except per share data) |
|||||||||||||||
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
78,069 |
|
$ |
80,576 |
|
$ |
312,910 |
|
$ |
310,482 |
||||
Cost of revenue |
|
49,955 |
|
|
|
48,296 |
|
|
|
199,764 |
|
|
|
189,892 |
|
GAAP gross profit |
|
28,114 |
|
|
|
32,280 |
|
|
|
113,146 |
|
|
|
120,590 |
|
Stock-based compensation |
|
477 |
|
|
|
446 |
|
|
|
1,959 |
|
|
|
1,334 |
|
Non-GAAP gross profit |
$ |
28,591 |
|
|
$ |
32,726 |
|
|
$ |
115,105 |
|
|
$ |
121,924 |
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
GAAP net income/(loss) |
$ |
2,902 |
|
|
$ |
(6,702 |
) |
|
$ |
(1,765 |
) |
|
$ |
(29,214 |
) |
Adjusted for: |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
|
2,671 |
|
|
|
1,719 |
|
|
|
8,926 |
|
|
|
6,626 |
|
Provision for/(benefit from) income taxes |
|
(1,398 |
) |
|
|
1,521 |
|
|
|
6,603 |
|
|
|
8,761 |
|
Stock-based compensation |
|
7,839 |
|
|
|
18,369 |
|
|
|
35,516 |
|
|
|
60,968 |
|
Geographic reorganization (1) |
|
330 |
|
|
|
1,390 |
|
|
|
1,858 |
|
|
|
11,023 |
|
Transaction and transformation-related costs (2) |
|
519 |
|
|
|
604 |
|
|
|
2,038 |
|
|
|
604 |
|
Restructuring costs (3) |
|
402 |
|
|
|
— |
|
|
|
1,488 |
|
|
|
— |
|
Other (income)/expenses, net (4) |
|
(2,569 |
) |
|
|
(431 |
) |
|
|
(10,418 |
) |
|
|
(555 |
) |
Non-GAAP EBITDA |
$ |
10,696 |
|
|
$ |
16,470 |
|
|
$ |
44,246 |
|
|
$ |
58,213 |
|
__________________________ |
||
(1) |
Geographic reorganization includes expenses connected with military actions of |
|
(2) |
Transaction and transformation-related costs include, when applicable, external deal costs, transaction-related professional fees, transaction-related retention bonuses, which are allocated proportionally across cost of revenue, engineering, research and development, sales and marketing and general and administrative expenses as well as other transaction-related costs including integration expenses consisting of outside professional and consulting services. |
|
(3) |
We implemented a restructuring plan during the first quarter of 2023. Our restructuring costs comprised of severance charges and respective taxes and are included in General and administrative expenses in the Company’s consolidated statement of income/(loss) and comprehensive income/(loss). |
|
(4) |
Other (income)/expenses, net consist primarily of losses and gains on foreign currency transactions, fair value adjustments, and other miscellaneous non-operating expenses and other income consists primarily of interest on cash held at banks and returns on investments in money-market funds. |
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
GAAP net income/(loss) |
$ |
2,902 |
|
|
$ |
(6,702 |
) |
|
$ |
(1,765 |
) |
|
$ |
(29,214 |
) |
Adjusted for: |
|
|
|
|
|
|
|
||||||||
Stock-based compensation |
|
7,839 |
|
|
|
18,369 |
|
|
|
35,516 |
|
|
|
60,968 |
|
Geographic reorganization (1) |
|
330 |
|
|
|
1,390 |
|
|
|
1,858 |
|
|
|
11,023 |
|
Transaction and transformation-related costs (2) |
|
519 |
|
|
|
604 |
|
|
|
2,038 |
|
|
|
604 |
|
Restructuring costs (3) |
|
402 |
|
|
|
— |
|
|
|
1,488 |
|
|
|
— |
|
Other (income)/expenses, net (4) |
|
(2,569 |
) |
|
|
(431 |
) |
|
|
(10,418 |
) |
|
|
(555 |
) |
Tax impact of non-GAAP adjustments (5) |
|
(3,726 |
) |
|
|
(2,757 |
) |
|
|
(3,640 |
) |
|
|
(6,199 |
) |
Non-GAAP net income |
$ |
5,697 |
|
|
$ |
10,473 |
|
|
$ |
25,077 |
|
|
$ |
36,627 |
|
Number of shares used in the GAAP diluted EPS |
|
78,033 |
|
|
|
74,036 |
|
|
|
75,193 |
|
|
|
69,197 |
|
GAAP diluted EPS |
$ |
0.04 |
|
|
$ |
(0.09 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.42 |
) |
Number of shares used in the Non-GAAP diluted EPS |
|
78,033 |
|
|
|
76,543 |
|
|
|
77,651 |
|
|
|
72,223 |
|
Non-GAAP diluted EPS |
$ |
0.07 |
|
|
$ |
0.14 |
|
|
$ |
0.32 |
|
|
$ |
0.51 |
|
__________________________ |
||
(1) |
Geographic reorganization includes expenses connected with military actions of |
|
(2) |
Transaction and transformation-related costs include, when applicable, external deal costs, transaction-related professional fees, transaction-related retention bonuses, which are allocated proportionally across cost of revenue, engineering, research and development, sales and marketing and general and administrative expenses as well as other transaction-related costs including integration expenses consisting of outside professional and consulting services. |
|
(3) |
We implemented a restructuring plan during the first quarter of 2023. Our restructuring costs comprised of severance charges and respective taxes and are included in General and administrative expenses in the Company’s consolidated statement of income/(loss) and comprehensive income/(loss). |
|
(4) |
Other (income)/expenses, net consist primarily of losses and gains on foreign currency transactions, fair value adjustments, and other miscellaneous non-operating expenses and other income consists primarily of interest on cash held at banks and returns on investments in money-market funds. |
|
(5) |
Reflects the estimated tax impact of the non-GAAP adjustments presented in the table. |
|
Schedule 5: |
|||||||||||||
GRID DYNAMICS HOLDINGS, INC. |
|||||||||||||
REVENUE BY VERTICALS |
|||||||||||||
Unaudited |
|||||||||||||
(In thousands) |
|||||||||||||
|
Three Months Ended December 31, |
||||||||||||
|
|
2023 |
|
|
% of revenue |
|
|
2022 |
|
|
% of revenue |
||
Retail |
$ |
24,579 |
|
31.5 |
% |
|
$ |
25,662 |
|
31.8 |
% |
||
Technology, Media and Telecom |
|
24,191 |
|
|
31.0 |
% |
|
|
27,164 |
|
|
33.7 |
% |
CPG/Manufacturing |
|
9,675 |
|
|
12.4 |
% |
|
|
14,089 |
|
|
17.5 |
% |
Finance |
|
8,280 |
|
|
10.6 |
% |
|
|
6,244 |
|
|
7.7 |
% |
Other |
|
11,344 |
|
|
14.5 |
% |
|
|
7,417 |
|
|
9.3 |
% |
Total |
$ |
78,069 |
|
|
100.0 |
% |
|
$ |
80,576 |
|
|
100.0 |
% |
|
|
Twelve Months Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
% of revenue |
|
|
2022 |
|
|
% of revenue |
||
Retail |
|
$ |
102,551 |
|
32.8 |
% |
|
$ |
99,681 |
|
32.1 |
% |
||
Technology, Media and Telecom |
|
|
98,830 |
|
|
31.6 |
% |
|
|
98,334 |
|
|
31.7 |
% |
CPG/Manufacturing |
|
|
42,861 |
|
|
13.7 |
% |
|
|
61,216 |
|
|
19.7 |
% |
Finance |
|
|
28,842 |
|
|
9.2 |
% |
|
|
21,893 |
|
|
7.1 |
% |
Other |
|
|
39,826 |
|
|
12.7 |
% |
|
|
29,358 |
|
|
9.4 |
% |
Total |
|
$ |
312,910 |
|
|
100.0 |
% |
|
$ |
310,482 |
|
|
100.0 |
% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240222291677/en/
Grid Dynamics Investor Relations:
investorrelations@griddynamics.com
Source: Grid Dynamics Holdings, Inc.
FAQ
What was Grid Dynamics' revenue for the fourth quarter of 2023?
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