Intapp Announces Second Quarter Fiscal Year 2024 Financial Results

Rhea-AI Summary

Intapp, Inc. (INTA) reported strong second-quarter financial results, with SaaS and support revenue of $77.1 million, up 25% year-over-year, and total revenue of $103.9 million, up 23% year-over-year. Cloud annual recurring revenue (ARR) also saw a significant increase, reaching $256.1 million, up 34% year-over-year. The company's CEO, John Hall, attributed this success to the addition of new clients, expansion of existing client accounts, and the growing demand for cloud transformation in the professional and financial services industry.

Positive

• SaaS and support revenue increased by 25% year-over-year
• Total revenue increased by 23% year-over-year
• Cloud annual recurring revenue (ARR) grew by 34% year-over-year
• Addition of new clients and expansion of existing client accounts contributed to the strong performance

Negative

• None.

Insights

Financial Analyst

The reported 25% year-over-year growth in SaaS and support revenue and 23% increase in total revenue are significant indicators of Intapp's strong performance and market presence. This growth trajectory, particularly in the SaaS sector, suggests that the company is successfully capturing market share and benefiting from the ongoing trend of digital transformation across professional and financial services industries. The expansion of existing client accounts and the acquisition of new clients are both contributing factors to this upward trend.

Furthermore, the 34% year-over-year increase in Cloud ARR is indicative of a healthy, growing subscription base, which is critical for the company's future revenue streams. Investors should note that a robust ARR can provide more predictable and stable revenues, which is often rewarded with higher valuation multiples in the stock market. The company's outlook for the upcoming quarter and the fiscal year will be closely watched for signs of sustained growth or any potential deceleration.

Market Research Analyst

Intapp's performance must be contextualized within the broader cloud software market, which has been experiencing significant growth as businesses continue to transition to cloud-based solutions. The company's focus on the global professional and financial services industry positions it within a niche that is likely to see increased demand for specialized software solutions. This specialization can lead to a competitive advantage and customer loyalty.

It's important to assess how Intapp's growth rates compare to its competitors and the industry average. Outperforming the market average could indicate that Intapp is effectively leveraging its competitive strengths, such as customer service, product innovation, or market positioning. Conversely, if growth rates are in line with or below the industry average, it could suggest a need for strategic adjustments to maintain competitiveness.

Economist

The company's performance, particularly in the context of a macroeconomic environment, can offer insights into the broader economic trends. The resilience of the SaaS model during economic downturns or periods of uncertainty may be reflected in Intapp's continued growth. The increase in ARR suggests that the company's services are seen as essential or high-priority by its clients, which could be a sign of economic strength within the professional and financial services sectors.

However, it is vital to consider potential economic headwinds that could impact Intapp's future performance, such as changes in interest rates, inflation, or a possible economic downturn. These factors could affect customer spending and potentially slow down the growth trajectory of the company. Keeping an eye on these macroeconomic indicators will be important for stakeholders to gauge the sustainability of Intapp's growth.

• Second quarter SaaS and support revenue of $77.1 million, up 25% year-over-year
• Second quarter total revenue of $103.9 million, up 23% year-over-year
• Cloud annual recurring revenue (ARR) of $256.1 million, up 34% year-over-year
  

PALO ALTO, Calif. , Feb. 06, 2024 (GLOBE NEWSWIRE) -- Intapp, Inc. (NASDAQ: INTA), a leading provider of cloud software for the global professional and financial services industry, announced financial results for its second quarter ended December 31, 2023. Intapp also provided its outlook for the third quarter and updated outlook for the full fiscal year of 2024.

“We are pleased to report solid second quarter performance, built on the addition of new clients, the expansion of existing client accounts, and the market’s appetite for cloud transformation,” said John Hall, CEO of Intapp. “We’re excited about our continued AI innovation and new features that we’ll be sharing with the market and at our inaugural investor day in February.”

Second Quarter of Fiscal Year 2024 Financial Highlights

• SaaS and support revenue was $77.1 million, a 25% year-over-year increase compared to the second quarter of fiscal year 2023.
• Total revenue was $103.9 million, a 23% year-over-year increase compared to the second quarter of fiscal year 2023.
• Cloud ARR was $256.1 million as of December 31, 2023, a 34% year-over-year increase compared to Cloud ARR as of December 31, 2022. Cloud ARR represented 70% of total ARR as of December 31, 2023, compared to 64% as of December 31, 2022.
• Total ARR was $365.0 million as of December 31, 2023, a 21% year-over-year increase compared to total ARR as of December 31, 2022.
• GAAP operating loss was $(11.1) million, compared to a GAAP operating loss of $(19.4) million in the second quarter of fiscal year 2023.
• Non-GAAP operating profit was $7.6 million, compared to a non-GAAP operating profit of $2.8 million in the second quarter of fiscal year 2023.
• GAAP net loss was $(9.2) million, compared to a GAAP net loss of $(19.8) million in the second quarter of fiscal year 2023.
• Non-GAAP net income was $8.8 million, compared to a non-GAAP net income of $2.2 million in the second quarter of fiscal year 2023.
• GAAP net loss per share was $(0.13), compared to a GAAP net loss per share of $(0.31) in the second quarter of fiscal year 2023.
• Non-GAAP diluted net income per share was $0.11, compared to a non-GAAP diluted net income per share of $0.03 in the second quarter of fiscal year 2023.

Balance Sheet and Cash Flow Highlights

• Cash and cash equivalents were $166.4 million as of December 31, 2023, compared to $130.4 million as of June 30, 2023.
• For the six months ended December 31, 2023, cash provided by operating activities was $23.6 million, compared to cash provided by operating activities of $13.3 million for the six months ended December 31, 2022.

Business Highlights

• As of December 31, 2023, we served more than 2,400 clients, 649 of which each with contracts greater than $100,000 of ARR.
• We upsold and cross-sold our existing clients such that our trailing twelve months’ net revenue retention rate as of December 31, 2023 was 115%, which is within our expected range of 113% to 117%.
• We continued to add new clients and expand existing accounts including private equity firm Beringer Capital; sovereign wealth fund Indonesia Investment Authority; and law firms Howard Kennedy, IBB Law, and McCabes Lawyers.
• We won two awards for DealCloud: Enterprise Product of the Year – All Other Software at the Best in Biz Awards and Best Data Provider – Overall at the Private Equity Wire U.S. Awards 2023.
• We made our solutions available in the Microsoft Azure Marketplace, an online market for solutions and services certified to run on Azure.
• We launched the Rainmaker Genome Project, a seminal research study on successful business development practices and Activator behaviors in the professional and financial services industry conducted in partnership with DCM Insights.
• We announced that Intapp senior management will host its inaugural Investor Day on February 22, 2024 in New York City and via webcast.
  

Third Quarter and Full Fiscal Year 2024 Outlook

	Fiscal 2024 Outlook
	Third Quarter	Fiscal Year
SaaS and support revenue (in millions)	$80.0 - $81.0	$312.0 - $316.0
Total revenue (in millions)	$107.5 - $108.5	$422.5 - $426.5
Non-GAAP operating profit (in millions)	$6.0 - $7.0	$27.0 - $31.0
Non-GAAP diluted net income per share	$0.06 - $0.08	$0.31 - $0.35

 

The guidance provided above constitutes forward-looking statements and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

The information presented in this press release includes non-GAAP financial measures such as “non-GAAP operating profit,” “non-GAAP net income,” and “non-GAAP diluted net income per share.” Refer to “Non-GAAP Financial Measures and Other Metrics” for a discussion of these measures and the financial tables below for reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure. The Company has not included a quantitative reconciliation of its guidance for non-GAAP operating profit and non-GAAP diluted net income per share to their most directly comparable GAAP financial measures because certain of these reconciling items, including stock-based compensation and amortization of intangible assets, could be highly variable and cannot be reasonably predicted without unreasonable effort. This is due to the inherent difficulty of forecasting the timing of certain events that have not yet occurred and are out of the Company’s control and the amounts of associated reconciling items. Please note that the unavailable reconciling items could significantly impact the Company’s GAAP operating results.

Corporate Presentation

A supplemental financial presentation and other information will be accessible through Intapp’s investor relations website at https://investors.intapp.com/. 

Webcast

Intapp will host a conference call for analysts and investors on Tuesday, February 6, 2024, beginning at 2:00 p.m. PT (5:00 p.m. ET). The call will be webcast live via the “Investors” section of the Intapp company website at https://investors.intapp.com/. A replay of the call will be available through the Intapp website for 90 days.

About Intapp

Intapp makes the connected firm possible. We provide cloud software solutions that address the unique operating challenges and regulatory requirements of the global professional and financial services industry. Our solutions help more than 2,400 of the world’s premier private capital, investment banking, legal, accounting, and consulting firms connect their most important assets: people, processes, and data. As part of a connected firm, professionals gain easy access to the information they need to win more business, increase investment returns, streamline deal and engagement execution, and strengthen risk management and compliance.

Forward-Looking Statements

This press release contains express and implied “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial outlook for the third quarter and full fiscal year 2024, growth strategy, business plans and market position. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “would,” “should,” “could,” “can,” “predict,” “potential,” “target,” “explore,” “continue,” “expand,” “outlook” or the negative of these terms, and similar expressions intended to identify forward-looking statements. By their nature, these statements are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance, or achievement to differ materially and adversely from those anticipated or implied in the statements, including: our ability to continue our growth at or near historical rates; our future financial performance and ability to be profitable; the effect of global events on the U.S. and global economies, our business, our employees, results of operations, financial condition, demand for our products, sales and implementation cycles, and the health of our clients’ and partners’ businesses; our ability to prevent and respond to data breaches, unauthorized access to client data or other disruptions of our solutions; our ability to effectively manage U.S. and global market and economic conditions, including inflationary pressures, economic and market downturns and volatility in the financial services industry, particularly adverse to our targeted industries; the length and variability of our sales cycle; our ability to attract and retain clients; our ability to attract and retain talent; our ability to compete in highly competitive markets, including AI products; our ability to manage additional complexity, burdens, and volatility in connection with our international sales and operations; our ability to incur indebtedness in the future and the effect of conditions in credit markets; the sufficiency of our cash and cash equivalents to meet our liquidity needs; and our ability to maintain, protect, and enhance our intellectual property rights. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption “Risk Factors” and elsewhere in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, and any subsequent public filings. Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. Forward-looking statements speak only as of the date the statements are made and are based on information available to us at the time those statements are made and/or management's good faith belief as of that time with respect to future events. We assume no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law.

Non-GAAP Financial Measures and Other Metrics

This press release contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating profit, non-GAAP net income and non-GAAP diluted net income per share. These non-GAAP measures exclude the impact of stock-based compensation, amortization of intangible assets, lease modification and impairment, change in fair value of contingent consideration, transaction costs and the income tax effect of non-GAAP adjustments. See below for a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure.

Other metrics include total ARR, Cloud ARR and net revenue retention rate. Total ARR represents the annualized recurring value of all active SaaS and on-premise subscription license contracts at the end of a reporting period. Cloud ARR is the portion of the annualized recurring value of our active SaaS contracts at the end of a reporting period. Contracts with a term other than one year are annualized by taking the committed contract value for the current period divided by number of days in that period, then multiplying by 365.

Net revenue retention rate is calculated by starting with the ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period ARR. We then calculate the ARR from these same clients as of the current fiscal period, or current period ARR. We then divide the current period ARR by the prior period ARR to calculate the net revenue retention rate.

We believe these non-GAAP financial measures and metrics provide useful information to investors as they are used by management to manage the business, make planning decisions, evaluate our performance, and allocate resources and provide useful information regarding certain financial and business trends relating to our financial condition and results of operations. These non-GAAP financial measures, which may be different than similarly-titled measures used by other companies, should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Guidance for non-GAAP financial measures excludes stock-based compensation expense and amortization of intangible assets. Non-GAAP diluted net income per share is calculated by dividing non-GAAP net income by the estimated diluted weighted average shares outstanding for the period.

Investor Contact

David Trone
Senior Vice President, Investor Relations
Intapp, Inc.
ir@intapp.com 

Media Contact

Ali Robinson
Global Media Relations Director
Intapp, Inc.
press@intapp.com 

INTAPP, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in thousands, except per share data and percentages)
		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
Revenues
SaaS and support		$	77,109			$	61,605			$	150,170			$	118,418
Subscription license			14,143				10,979				28,046				23,227
Total recurring revenues			91,252				72,584				178,216				141,645
Professional services			12,681				12,108				27,292				22,585
Total revenues			103,933				84,692				205,508				164,230
Cost of revenues
SaaS and support			14,416				12,456				28,829				24,854
Total cost of recurring revenues			14,416				12,456				28,829				24,854
Professional services			16,353				14,329				33,513				27,265
Total cost of revenues			30,769				26,785				62,342				52,119
Gross profit			73,164				57,907				143,166				112,111
Gross margin			70.4	%			68.4	%			69.7	%			68.3	%
Operating expenses:
Research and development			27,981				23,392				56,477				43,071
Sales and marketing			35,269				33,538				69,688				64,850
General and administrative			20,996				20,753				42,048				41,163
Lease modification and impairment			—				(348	)			—				1,601
Total operating expenses			84,246				77,335				168,213				150,685
Operating loss			(11,082	)			(19,428	)			(25,047	)			(38,574	)
Interest and other income (expense), net			2,057				140				1,114				(583	)
Net loss before income taxes			(9,025	)			(19,288	)			(23,933	)			(39,157	)
Income tax expense			(188	)			(466	)			(601	)			(651	)
Net loss		$	(9,213	)		$	(19,754	)		$	(24,534	)		$	(39,808	)
Net loss per share, basic and diluted		$	(0.13	)		$	(0.31	)		$	(0.35	)		$	(0.63	)
Weighted-average shares used to compute net loss per share, basic and diluted			70,521				63,287				69,729				63,076

INTAPP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands)
		December 31, 2023				June 30, 2023
Assets
Current assets:
Cash and cash equivalents		$	166,357			$	130,377
Restricted cash			200				808
Accounts receivable, net			78,969				92,973
Unbilled receivables, net			16,435				10,661
Other receivables, net			1,524				878
Prepaid expenses			8,028				7,335
Deferred commissions, current			12,585				11,807
Total current assets			284,098				254,839
Property and equipment, net			17,311				16,366
Operating lease right-of-use assets			15,378				17,180
Goodwill			278,955				278,890
Intangible assets, net			37,938				43,257
Deferred commissions, noncurrent			16,819				16,529
Other assets			3,029				1,846
Total assets		$	653,528			$	628,907
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable		$	10,559			$	6,018
Accrued compensation			31,622				39,761
Accrued expenses			12,546				11,626
Deferred revenue, net			195,513				191,042
Other current liabilities			8,903				10,902
Total current liabilities			259,143				259,349
Deferred tax liabilities			1,205				1,422
Deferred revenue, noncurrent			1,721				1,355
Operating lease liabilities, noncurrent			14,663				16,195
Other liabilities			5,139				9,378
Total liabilities			281,871				287,699
Stockholders’ equity:
Common stock			72				69
Additional paid-in capital			852,558				797,639
Accumulated other comprehensive loss			(1,278	)			(1,339	)
Accumulated deficit			(479,695	)			(455,161	)
Total stockholders’ equity			371,657				341,208
Total liabilities and stockholders’ equity		$	653,528			$	628,907

INTAPP, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited, in thousands)
		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
Cash Flows from Operating Activities:
Net loss		$	(9,213	)		$	(19,754	)		$	(24,534	)		$	(39,808	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization			3,975				3,621				7,984				7,737
Amortization of operating lease right-of-use assets			1,152				1,131				2,282				2,404
Accounts receivable allowances			803				518				1,228				676
Stock-based compensation			16,508				20,268				35,265				36,036
Lease modification and impairment			—				(348	)			—				1,601
Change in fair value of contingent consideration			(784	)			(85	)			(2,215	)			(232	)
Deferred income taxes			(104	)			(146	)			(217	)			(304	)
Other			39				39				77				77
Changes in operating assets and liabilities:
Accounts receivable			(10,902	)			(16,754	)			12,570				(1,514	)
Unbilled receivables, current			(1,888	)			(192	)			(5,774	)			(2,390	)
Prepaid expenses and other assets			(446	)			2,336				(1,788	)			1,029
Deferred commissions			(1,189	)			(1,162	)			(1,068	)			(1,556	)
Accounts payable and accrued liabilities			9,760				7,733				(1,517	)			(8,094	)
Deferred revenue, net			4,615				11,661				4,837				18,773
Operating lease liabilities			(768	)			(986	)			(2,339	)			(3,123	)
Other liabilities			477				2,252				(1,144	)			2,035
Net cash provided by operating activities			12,035				10,132				23,647				13,347
Cash Flows from Investing Activities:
Purchases of property and equipment			(213	)			(30	)			(1,354	)			(1,698	)
Capitalized internal-use software costs			(1,592	)			(1,431	)			(3,453	)			(2,697	)
Net cash used in investing activities			(1,805	)			(1,461	)			(4,807	)			(4,395	)
Cash Flows from Financing Activities:
Payments for deferred offering costs			(148	)			—				(781	)			—
Proceeds from stock option exercises			15,612				3,451				17,936				4,480
Proceeds from employee stock purchase plan			1,725				1,241				1,725				1,241
Payments related to tax withholding for vested equity awards			—				(3,447	)			—				(4,948	)
Payments of deferred contingent consideration and holdback associated with acquisitions			(2,551	)			(1,816	)			(2,551	)			(11,115	)
Net cash provided by (used in) financing activities			14,638				(571	)			16,329				(10,342	)
Effect of foreign currency exchange rate changes on cash and cash equivalents			(58	)			617				203				(351	)
Net increase (decrease) in cash, cash equivalents and restricted cash			24,810				8,717				35,372				(1,741	)
Cash, cash equivalents and restricted cash - beginning of period			141,747				43,853				131,185				54,311
Cash, cash equivalents and restricted cash - end of period		$	166,557			$	52,570			$	166,557			$	52,570

INTAPP, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Unaudited, in thousands, except per share data and percentages)

The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP financial measures for the periods indicated below:

Non-GAAP Gross Profit

		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
GAAP gross profit		$	73,164			$	57,907			$	143,166			$	112,111
Adjusted to exclude the following:
Stock-based compensation			2,018				1,691				3,892				2,724
Amortization of intangible assets			1,055				917				2,110				2,413
Non-GAAP gross profit		$	76,237			$	60,515			$	149,168			$	117,248
Non-GAAP gross margin			73.4	%			71.5	%			72.6	%			71.4	%

Non-GAAP Operating Expenses

		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
GAAP research and development		$	27,981			$	23,392			$	56,477			$	43,071
Stock-based compensation			(4,468	)			(4,646	)			(9,114	)			(6,780	)
Non-GAAP research and development		$	23,513			$	18,746			$	47,363			$	36,291
GAAP sales and marketing		$	35,269			$	33,538			$	69,688			$	64,850
Stock-based compensation			(4,888	)			(6,352	)			(10,227	)			(12,105	)
Amortization of intangible assets			(1,396	)			(1,467	)			(2,883	)			(2,931	)
Non-GAAP sales and marketing		$	28,985			$	25,719			$	56,578			$	49,814
GAAP general and administrative		$	20,996			$	20,753			$	42,048			$	41,163
Stock-based compensation			(5,134	)			(7,579	)			(12,032	)			(14,427	)
Amortization of intangible assets			(163	)			(122	)			(326	)			(243	)
Change in fair value of contingent consideration			784				232				2,215				232
Transaction costs(1)			(350	)			(42	)			(678	)			(201	)
Non-GAAP general and administrative		$	16,133			$	13,242			$	31,227			$	26,524

Non-GAAP Operating Profit

		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
GAAP operating loss		$	(11,082	)		$	(19,428	)		$	(25,047	)		$	(38,574	)
Adjusted to exclude the following:
Stock-based compensation			16,508				20,268				35,265				36,036
Amortization of intangible assets			2,614				2,506				5,319				5,587
Lease modification and impairment			—				(348	)			—				1,601
Change in fair value of contingent consideration			(784	)			(232	)			(2,215	)			(232	)
Transaction costs(1)			350				42				678				201
Non-GAAP operating profit		$	7,606			$	2,808			$	14,000			$	4,619

Non-GAAP Net Income

		Three Months Ended December 31,								Six Months Ended December 31,
		2023				2022				2023				2022
GAAP net loss		$	(9,213	)		$	(19,754	)		$	(24,534	)		$	(39,808	)
Adjusted to exclude the following:
Stock-based compensation			16,508				20,268				35,265				36,036
Amortization of intangible assets			2,614				2,506				5,319				5,587
Lease modification and impairment			—				(348	)			—				1,601
Change in fair value of contingent consideration			(784	)			(232	)			(2,215	)			(232	)
Transaction costs(1)			350				42				678				201
Income tax effect of non-GAAP adjustments			(710	)			(244	)			(1,125	)			(481	)
Non-GAAP net income		$	8,765			$	2,238			$	13,388			$	2,904
GAAP net loss per share, basic and diluted		$	(0.13	)		$	(0.31	)		$	(0.35	)		$	(0.63	)
Non-GAAP net income per share, diluted		$	0.11			$	0.03			$	0.17			$	0.04
Weighted-average shares used to compute GAAP net loss per share, basic and diluted			70,521				63,287				69,729				63,076
Weighted-average shares used to compute non-GAAP net income per share, diluted			80,285				72,067				79,926				70,080

(1) Consists of acquisition-related transaction costs and costs related to certain non-capitalized offering-related expenses. 

FAQ

What was Intapp's second quarter SaaS and support revenue?

Intapp's second quarter SaaS and support revenue was $77.1 million, up 25% year-over-year.

What was Intapp's total revenue for the second quarter?

Intapp's total revenue for the second quarter was $103.9 million, up 23% year-over-year.

What was Intapp's cloud annual recurring revenue (ARR) for the reported period?

Intapp's cloud annual recurring revenue (ARR) for the reported period was $256.1 million, up 34% year-over-year.

What did Intapp's CEO attribute the second quarter performance to?

Intapp's CEO attributed the second quarter performance to the addition of new clients, expansion of existing client accounts, and the market’s appetite for cloud transformation.