Squarespace Announces Fourth Quarter and Full Year 2023 Financial Results and $500 Million Share Repurchase Authorization
- Revenue surpassed $1 billion in 2023, marking a significant milestone for Squarespace.
- Total revenue grew by 18% in the fourth quarter and 17% for the full year.
- Key acquisitions, product launches, and partnerships contributed to the company's growth.
- Squarespace reported a record fourth quarter, increased cash flow, and improved profitability.
- The company's outlook for 2024 includes revenue and cash flow growth projections.
- None.
Insights
The reported 17-18% revenue growth for Squarespace in both Q4 and the full fiscal year 2023 is a significant indicator of the company's ability to expand its customer base and enhance its product offerings. This growth, particularly the milestone of surpassing $1 billion in revenue, is a testament to the company's strategic initiatives such as the acquisition of Google Domains and the launch of Squarespace Payments. The shift from a net loss in 2022 to a net income in Q4 2023, excluding the prior year's goodwill impairment charge, suggests improved operational efficiency and cost management.
The announcement of a $500 million share repurchase program reflects the company's confidence in its financial stability and commitment to returning value to shareholders. The impact of this program on the stock price will depend on the market's perception of Squarespace's growth prospects and the effectiveness of capital allocation.
Investors should note the increase in cash flow from operating activities and the strong growth in unlevered free cash flow, which indicates robust cash generation capabilities. This financial health is crucial for funding future growth initiatives and managing debt levels. The debt net of cash and investments, however, warrants monitoring as it represents a significant financial obligation.
Squarespace's focus on product innovation and marketing efforts, such as the partnership with SoundCloud and the Big Game campaign, are likely to enhance its brand presence and attract new customers. The reported 10% increase in unique subscriptions and the 9% rise in average revenue per unique subscription (ARPUS) reflect successful upselling and cross-selling strategies, contributing to the company's revenue growth.
Additionally, the international expansion and the diversification of currency options are strategic moves that may help mitigate market-specific risks and tap into new revenue streams. The company's emphasis on its core verticals—small business, commerce and international expansion—aligns with the growing global e-commerce trend and the increasing demand for online presence among entrepreneurs.
The economic implications of Squarespace's financial results are multi-faceted. On one hand, the company's revenue growth and transition to profitability indicate a strong demand for its services, which could be reflective of broader economic trends such as the digitization of small businesses and the resilience of the tech sector amid economic uncertainties. On the other hand, the global economic outlook, including currency fluctuations, could influence Squarespace's international revenues and operating costs.
The company's constant currency revenue growth metric provides investors with a clearer picture of its underlying performance, excluding the volatile effects of foreign exchange movements. This is particularly relevant for Squarespace given its international business operations and expansion goals.
Revenue Increased
Squarespace to Host Investor Day on May 15, 2024
"Squarespace surpassed
"Squarespace delivered a record fourth quarter that exceeded our expectations across the board," said Nathan Gooden, CFO of Squarespace. "We are combining increased scale and profitability with consistent execution and a relentless focus on innovation for entrepreneurs to set a strong foundation for sustainable growth and value creation. We view share repurchases as an integral part of our capital allocation strategy and the
Fourth Quarter 2023 Financial Highlights
- Total revenue grew
18% year over year to$270.7 million $228.8 million 16% in constant currency.- Presence revenue grew
20% year over year to$188.4 million 18% in constant currency. - Commerce revenue grew
14% year over year to$82.3 million 13% in constant currency.
- Presence revenue grew
- Net income totaled
$5.3 million $234.0 million $225.2 million $8.8 million - Earnings per share totaled
$0.04 $1.72 - Cash flow from operating activities increased
56% to$61.1 million $39.1 million - Total bookings grew
23% year over year to$286.1 million $232.1 million - Unlevered free cash flow increased
57% to$65.0 million 24% of total revenue for the three months ended December 31, 2023, compared with$41.5 million - Adjusted EBITDA increased to
$64.7 million $63.1 million
Full Year 2023 Financial Highlights
- Total revenue grew
17% year over year to$1,012.3 million $867.0 million 16% in constant currency.- Presence revenue grew
18% year over year to$704.3 million 17% in constant currency. - Commerce revenue grew
14% year over year to$308.0 million 14% in constant currency.
- Presence revenue grew
- Net loss was
$7.1 million $252.2 million $225.2 million $27.1 million - Loss per share of
$0.05 $1.82 - Cash flow from operating activities increased
41% to$231.1 million $164.2 million - Total bookings grew
19% year over year to$1,075.1 million $906.1 million - Unlevered free cash flow increased
46% to$241.0 million 24% of total revenue in 2023, compared with$165.6 million - Adjusted EBITDA increased to
$235.4 million $147.5 million - Cash and cash equivalents at year-end 2023 of
$257.7 million $568.8 million $49.0 million $311.1 million - Total unique subscriptions increased
10% year over year to over 4.6 million in 2023, compared to 4.2 million in 2022. - Average revenue per unique subscription ("ARPUS") increased
9% year over year to$228.02 $209.16 - Annual run rate revenue ("ARRR") grew
19% year over year to$1,105.7 million $931.7 million
A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."
2023 Business Highlights
Product Innovation
Squarespace provides superior design and ease of use technology for entrepreneurs everywhere. Our passion for innovation drove all areas of our business. In 2023, the Company:
- Relaunched Squarespace Domains with a more complete domain management experience for domain-first customers following our acquisition of Google Domains Assets.
- Launched Squarespace Payments, which fully integrates with our customers' online stores to accept fast and secure payments and provides a seamless purchase experience for their customers all in one place.
- Unveiled Squarespace Blueprint, our guided website design system that provides professionally-curated layouts and styling options.
- Advanced Acuity Scheduling's platform technologies and introduced new branding to help streamline the client booking experience with a centralized dashboard, mobile app tools, and payment features.
- Invested in Squarespace AI to make it easier than ever for users to generate custom content. Generative AI integrations help populate websites, email campaigns, and commerce store descriptions, enabling customers to efficiently publish and specialize content for their brand identity.
- Released our annual compilation of new products and features, Squarespace Refresh, where we showcased new tools spanning commerce, client invoicing, courses, email marketing, enterprise customer collaboration, and more.
- Enhanced Tock's User System with a new iOS app and new reservation features, and integrated Reserve with Google to help Tock customers increase their visibility and drive diners to their businesses.
- Established a partnership with SoundCloud to bring SoundCloud Next Pro artists the opportunity to create a beautiful website with unique, music-themed domains.
Marketing & Brand
Our marketing investments, design-centric ethos, and go-to-market channels bolster our brand recognition and keep Squarespace top of mind for new audiences. This year, Squarespace:
- Continued to globalize our product suite by increasing our currency options by 5x.
- Introduced the second edition of Squarespace Collection (formerly Squarespace Icons) with Magnum Photos, where we partnered with six world renowned photographers to create signature website designs inspired by each photographer's creativity and built on our website editor, Fluid Engine™.
- Teamed up with Adam Driver for our 9th Big Game campaign, "The Singularity," where we honored Squarespace's founding history as a pioneer in website building.
- Hosted our second Circle Day where we engaged thousands of members of our Circle partner program from around the world. Members shared advice and strategies on how to leverage strengths, skills, and connections to expand every web designer's professional toolkit.
- Received multiple Fast Company awards, including Fast Company's Most Innovative Companies and Innovation by Design, won two Webby Awards and our Big Game commercial won top honors from ADC, AICP, Cannes Lions, Ciclope, D&AD and the One Show.
Corporate
Squarespace is focused on creating and delivering value to entrepreneurs, partners, and investors. In 2023, the Company:
- Acquired Google's Domains business, representing millions of domains, and established an exclusive reseller agreement for any customer purchasing a domain along with their Google Workspace subscription from Google directly.
- Won multiple awards recognizing the excellence of our organization including Comparably's Best Places to Work in
New York . - Celebrated our 20th anniversary; across two decades the Squarespace platform has been used by millions to build beautiful brands and businesses online.
- Returned approximately
$26.0 million to shareholders under our share repurchase program as of December 31, 2023, which represents approximately 1.3 million shares.
Share Repurchase Program
Squarespace's board of directors authorized a general share repurchase program of the Company's Class A common stock of up to
Outlook & Guidance
For the first quarter of fiscal year 2024, Squarespace currently expects:
- Revenue of
$274 million $277 million 16% to17% . - Non-GAAP unlevered free cash flow of
$83 million $86 million - Cash flow from operating activities of
$77 million $81 million - Capital expenditures, expected to be approximately
$2 million $3 million - Cash paid for interest expense net of associated tax benefit, expected to be approximately
$8 million
- Cash flow from operating activities of
For the full fiscal year 2024, Squarespace currently expects:
- Revenue of
$1,170 million $1,190 million 16% to18% , which includes contributions in the range of$85 million $88 million - Non-GAAP unlevered free cash flow of
$290 million $310 million - Cash flow from operating activities of
$266 million $288 million - Capital expenditures, expected in the range of
$4 million $6 million - Cash paid for interest expense net of associated tax benefit, expected to be approximately
$28 million
- Cash flow from operating activities of
Webcast Conference Call & Shareholder Letter Information
Squarespace will host a conference call on February 28, 2024 at 8:30 a.m. ET to discuss its financial results. A live webcast of the event will be available in the Events & Presentations section of the Squarespace Investor Relations website. An archived replay of the webcast will be available following the conclusion of the call. Additionally, we invite you to read our shareholder letter available on our Investor Relations website.
Squarespace to Host Investor Day
Squarespace will host an Investor Day on May 15, 2024 in
Non-GAAP Financial Measures
Revenue growth in constant currency is being provided to increase transparency and align our disclosures with companies in our industry that receive material revenues from international sources. Revenue constant currency has been adjusted to exclude the effect of year-over-year changes in foreign currency exchange rate fluctuations. We believe providing this information better enables investors to understand our operating performance irrespective of currency fluctuations.
We calculate constant currency information by translating current period results from entities with foreign functional currencies using the comparable foreign currency exchange rates from the prior fiscal year. To calculate the effect of foreign currency translation, we apply the same weighted monthly average exchange rate as the comparative period. Our definition of constant currency may differ from other companies reporting similarly named measures, and these constant currency performance measures should be viewed in addition to, and not as a substitute for, our operating performance measures calculated in accordance with GAAP.
Adjusted EBITDA is a supplemental performance measure that our management uses to assess our operating performance. We calculate adjusted EBITDA as net income/(loss) excluding interest expense, other income/(loss), net (provision for)/benefit from income taxes, depreciation and amortization, stock-based compensation expense and other items that we do not consider indicative of our ongoing operating performance.
Unlevered free cash flow is a supplemental liquidity measure that Squarespace's management uses to evaluate its core operating business and its ability to meet its current and future financing and investing needs. Unlevered free cash flow is defined as cash flow from operating activities, including one-time expenses related to Squarespace's direct listing, less cash paid for capital expenditures increased by cash paid for interest expense net of the associated tax benefit.
Adjusted EBITDA, unlevered free cash flow and revenue constant currency are not prepared in accordance with generally accepted accounting principles in
Further information on these non-GAAP items and reconciliation to their closest GAAP measure is provided below under, "Reconciliation of Non-GAAP Financial Measures."
Definitions of Key Operating Metrics
On September 7, 2023, we closed an asset purchase agreement between us and Google LLC ("Google") to acquire, among other things, Google's domain assets (the "Google Domains Asset Acquisition "). Unique subscriptions and average revenue per unique subscription do not account for single domain subscriptions originally sold by Google as a part of the Google Domains Asset Acquisition (the "Acquired Domain Assets").
Annual run rate revenue ("ARRR"). We calculate ARRR as the monthly revenue from subscription fees and revenue generated in conjunction with associated fees (fees taken or assessed in conjunction with commerce transactions) in the last month of the period multiplied by 12. We believe that ARRR is a key indicator of our future revenue potential. However, ARRR should be viewed independently of revenue, and does not represent our GAAP revenue on an annualized basis, as it is an operating metric that can be impacted by subscription start and end dates and renewal rates. ARRR is not intended to be a replacement or forecast of revenue.
Unique subscriptions represent the number of unique sites, standalone scheduling subscriptions, Unfold (social) and hospitality subscriptions, as of the end of a period. A unique site represents a single subscription and/or group of related subscriptions, including a website subscription and/or a domain subscription, and other subscriptions related to a single website or domain. Every unique site contains at least one domain subscription or one website subscription. For instance, an active website subscription, a custom domain subscription and a Google Workspace subscription that represent services for a single website would count as one unique site, as all of these subscriptions work together and are in service of a single entity's online presence. Unique subscriptions do not account for one-time purchases in Unfold or for hospitality services nor do they account for our Acquired Domain Assets. The total number of unique subscriptions is a key indicator of the scale of our business and is a critical factor in our ability to increase our revenue base.
Average revenue per unique subscription ("ARPUS"). We calculate ARPUS as the total revenue during the preceding 12-month period divided by the average of the number of total unique subscriptions at the beginning and end of the period. ARPUS does not account for Acquired Domain Assets or the revenue from Acquired Domain Assets. We believe ARPUS is a useful metric in evaluating our ability to sell higher-value plans and add-on subscriptions.
Total bookings represents cash receipts for all subscriptions purchased, as well as payments due under the terms of contractual agreements for obligations to be fulfilled.
Gross merchandise value ("GMV") represents the value of physical goods, content and time sold, including hospitality services, net of refunds, on our platform over a given period of time.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. These statements include, but are not limited to, statements regarding Squarespace's future operating results and financial position, including for its first fiscal quarter ending March 31, 2024 and its fiscal year ending December 31, 2024. The words "believe," "may," "will," "estimate," "potential," "continue," "anticipate," "intend," "expect," "could," "would," "project," "plan," "target," and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on management's expectations, assumptions, and projections based on information available at the time the statements were made. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including risks and uncertainties related to: Squarespace's ability to attract and retain customers and expand their use of its platform; Squarespace's ability to anticipate market needs and develop new solutions to meet those needs; Squarespace's ability to improve and enhance the functionality, performance, reliability, design, security and scalability of its existing solutions; Squarespace's ability to compete successfully in its industry against current and future competitors; Squarespace's ability to manage growth and maintain demand for its solutions; Squarespace's ability to protect and promote its brand; Squarespace's ability to generate new customers through its marketing and selling activities; Squarespace's ability to successfully identify, manage and integrate any existing and potential acquisitions or achieve the expected benefits of such acquisitions; Squarespace's ability to hire, integrate and retain highly skilled personnel; Squarespace's ability to adapt to and comply with existing and emerging regulatory developments, technological changes and cybersecurity needs; Squarespace's compliance with privacy and data protection laws and regulations as well as contractual privacy and data protection obligations; Squarespace's ability to establish and maintain intellectual property rights; Squarespace's ability to manage expansion into international markets; and the expected timing, amount, and effect of Squarespace's share repurchases. It is not possible for Squarespace's management to predict all risks, nor can it assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements Squarespace may make. In light of these risks, uncertainties, and assumptions, Squarespace's actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Further information on risks that could cause actual results to differ materially from forecasted results are included in Squarespace's filings with the Securities and Exchange Commission. Except as required by law, Squarespace assumes no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.
About Squarespace
Squarespace (NYSE: SQSP) is a design-driven platform helping entrepreneurs build brands and businesses online. We empower millions in more than 200 countries and territories with all the tools they need to create an online presence, build an audience, monetize, and scale their business. Our suite of products range from websites, domains, ecommerce, and marketing tools, as well as tools for scheduling with Acuity, creating and managing social media presence with Bio Sites and Unfold, and hospitality business management via Tock. For more information, visit www.squarespace.com.
Contacts
Investors
investors@squarespace.com
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Revenue | $ 270,718 | $ 228,812 | $ 1,012,336 | $ 866,972 | |||
Cost of revenue(1) | 69,650 | 40,106 | 207,520 | 152,655 | |||
Gross profit | 201,068 | 188,706 | 804,816 | 714,317 | |||
Operating expenses: | |||||||
Research and product development(1) | 61,715 | 56,828 | 242,188 | 227,297 | |||
Marketing and sales(1) | 91,513 | 66,154 | 349,574 | 322,051 | |||
General and administrative(1) | 29,922 | 37,942 | 129,326 | 151,620 | |||
Impairment charge | — | 225,163 | — | 225,163 | |||
Total operating expenses | 183,150 | 386,087 | 721,088 | 926,131 | |||
Operating income/(loss) | 17,918 | (197,381) | 83,728 | (211,814) | |||
Interest expense | (10,718) | (7,230) | (36,768) | (18,207) | |||
Other (loss)/income, net | (4,163) | (9,567) | 3,362 | 5,030 | |||
Income/(loss) before benefit from/(provision for) income | 3,037 | (214,178) | 50,322 | (224,991) | |||
Benefit from/(provision for) income taxes | 2,219 | (19,784) | (57,403) | (27,230) | |||
Net income/(loss) | $ 5,256 | $ (233,962) | $ (7,081) | $ (252,221) | |||
Net income/(loss) per share, basic and dilutive | $ 0.04 | $ (1.72) | $ (0.05) | $ (1.82) | |||
Weighted-average shares used in computing net income/ | 136,153,002 | 136,340,283 | 135,531,363 | 138,409,491 | |||
Weighted-average shares used in computing net income/ | 139,387,350 | 136,340,283 | 135,531,363 | 138,409,491 | |||
(1) Includes stock-based compensation as follows: | |||||||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Cost of revenue | $ 1,451 | $ 944 | $ 5,536 | $ 3,414 | |||
Research and product development | 13,868 | 11,099 | 54,806 | 42,237 | |||
Marketing and sales | 2,921 | 2,450 | 10,856 | 8,696 | |||
General and administrative | 9,587 | 12,989 | 36,551 | 48,186 | |||
Total stock-based compensation | $ 27,827 | $ 27,482 | $ 107,749 | $ 102,533 | |||
CONSOLIDATED BALANCE SHEETS | |||
December 31, 2023 | December 31, 2022 | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 257,702 | $ 197,037 | |
Restricted cash | 36,583 | 35,583 | |
Investment in marketable securities | — | 31,757 | |
Accounts receivable | 24,894 | 10,748 | |
Due from vendors | 6,089 | 4,442 | |
Prepaid expenses and other current assets | 48,947 | 48,326 | |
Total current assets | 374,215 | 327,893 | |
Property and equipment, net | 58,211 | 51,633 | |
Operating lease right-of-use assets | 77,764 | 86,824 | |
Goodwill | 210,438 | 210,438 | |
Intangible assets, net | 190,103 | 42,808 | |
Other assets | 11,028 | 10,921 | |
Total assets | $ 921,759 | $ 730,517 | |
Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Deficit | |||
Current liabilities: | |||
Accounts payable | $ 12,863 | $ 12,987 | |
Accrued liabilities | 99,435 | 64,360 | |
Deferred revenue | 333,191 | 269,689 | |
Funds payable to customers | 42,672 | 38,845 | |
Debt, current portion | 48,977 | 40,758 | |
Operating lease liabilities, current portion | 12,640 | 11,514 | |
Total current liabilities | 549,778 | 438,153 | |
Deferred income taxes, non-current portion | 1,039 | 788 | |
Debt, non-current portion | 519,816 | 473,167 | |
Operating lease liabilities, non-current portion | 97,714 | 110,169 | |
Other liabilities | 13,764 | 11,231 | |
Total liabilities | 1,182,111 | 1,033,508 | |
Commitments and contingencies | |||
Redeemable convertible preferred stock, par value of | — | — | |
Preferred stock, par value of | — | — | |
Stockholders' deficit: | |||
Class A common stock, par value of | 9 | 8 | |
Class B common stock, par value of | 5 | 5 | |
Class C common stock (authorized March 15, 2021), par value of | — | — | |
Class C common stock (authorized May 10, 2021), par value of | — | — | |
Additional paid in capital | 924,634 | 875,737 | |
Accumulated other comprehensive loss | (843) | (1,665) | |
Accumulated deficit | (1,184,157) | (1,177,076) | |
Total stockholders' deficit | (260,352) | (302,991) | |
Total liabilities, redeemable convertible preferred stock and stockholders' deficit | $ 921,759 | $ 730,517 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
Years Ended December 31, | |||
2023 | 2022 | ||
OPERATING ACTIVITIES: | |||
Net loss | $ (7,081) | $ (252,221) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 43,927 | 31,617 | |
Stock-based compensation | 107,749 | 102,533 | |
Impairment charge | — | 225,163 | |
Deferred income taxes | 251 | 788 | |
Non-cash lease (income)/expense | (2,286) | 2,227 | |
Other | 831 | 832 | |
Changes in operating assets and liabilities: | |||
Accounts receivable and due from vendors | (15,678) | (5,461) | |
Prepaid expenses and other current assets | (458) | 3,699 | |
Accounts payable and accrued liabilities | 33,519 | (2,215) | |
Deferred revenue | 61,364 | 39,464 | |
Funds payable to customers | 3,827 | 8,707 | |
Other operating assets and liabilities | 5,152 | 9,086 | |
Net cash provided by operating activities | 231,117 | 164,219 | |
INVESTING ACTIVITIES: | |||
Proceeds from the sale and maturities of marketable securities | 39,664 | 27,193 | |
Purchases of marketable securities | (7,824) | (27,681) | |
Cash paid for acquisitions, net of acquired cash | (176,721) | — | |
Purchase of property and equipment | (16,998) | (11,543) | |
Net cash used in operating activities | (161,879) | (12,031) | |
FINANCING ACTIVITIES: | |||
Borrowings on Term Loan | 99,444 | — | |
Payments of debt issuance costs | (637) | — | |
Principal payments on debt | (44,867) | (13,586) | |
Payments for repurchase and retirement of Class A common stock | (25,989) | (120,193) | |
Taxes paid related to net share settlement of equity awards | (36,366) | (21,268) | |
Proceeds from exercise of stock options | 228 | 2,211 | |
Net cash used in financing activities | (8,187) | (152,836) | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 614 | (412) | |
Net increase/(decrease) in cash, cash equivalents and restricted cash | 61,665 | (1,060) | |
Cash, cash equivalents and restricted cash at the beginning of the period | 232,620 | 233,680 | |
Cash, cash equivalents and restricted cash at the end of the period | $ 294,285 | $ 232,620 | |
Reconciliation of cash, cash equivalents and restricted cash: | |||
Cash and cash equivalents | $ 257,702 | $ 197,037 | |
Restricted cash | 36,583 | 35,583 | |
Cash, cash equivalents and restricted cash at the end of the period | $ 294,285 | $ 232,620 | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW | |||
Cash paid during the year for interest | $ 35,668 | $ 17,088 | |
Cash paid during the year for income taxes, net of refunds | $ 41,747 | $ 10,664 | |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | |||
Purchases of property and equipment included in accounts payable and accrued liabilities | $ 129 | $ 1,784 | |
Accrued taxes related to net share settlement of equity awards | $ 377 | $ 176 | |
Non-cash leasehold improvements | $ — | $ (5,864) | |
Capitalized stock-based compensation | $ 3,940 | $ 980 | |
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES | |||||||
The following tables reconcile each non-GAAP financial measure to its most directly comparable GAAP financial | |||||||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Net income/(loss) | $ 5,256 | $ (233,962) | $ (7,081) | $ (252,221) | |||
Interest expense | 10,718 | 7,230 | 36,768 | 18,207 | |||
(Benefit from)/provision for income taxes | (2,219) | 19,784 | 57,403 | 27,230 | |||
Depreciation and amortization | 18,952 | 7,844 | 43,927 | 31,617 | |||
Stock-based compensation expense | 27,827 | 27,482 | 107,749 | 102,533 | |||
Other loss/(income), net | 4,163 | 9,567 | (3,362) | (5,030) | |||
Impairment charge | — | 225,163 | — | 225,163 | |||
Adjusted EBITDA | $ 64,697 | $ 63,108 | $ 235,404 | $ 147,499 | |||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Cash flows from operating activities | $ 61,090 | $ 39,102 | $ 231,117 | $ 164,219 | |||
Cash paid for capital expenditures | (3,857) | (2,691) | (16,998) | (11,543) | |||
Free cash flow | $ 57,233 | $ 36,411 | $ 214,119 | $ 152,676 | |||
Cash paid for interest, net of the associated tax | 7,788 | 5,105 | 26,894 | 12,874 | |||
Unlevered free cash flow | $ 65,021 | $ 41,516 | $ 241,013 | $ 165,550 | |||
December 31, 2023 | December 31, 2022 | ||||||
Total debt outstanding | $ 568,793 | $ 513,925 | |||||
Less: total cash and cash equivalents and marketable securities | 257,702 | 228,794 | |||||
Total net debt | $ 311,091 | $ 285,131 | |||||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Revenue, as reported | $ 270,718 | $ 228,812 | $ 1,012,336 | $ 866,972 | |||
Revenue year-over-year growth rate, as reported | 18.3 % | 10.3 % | 16.8 % | 10.6 % | |||
Effect of foreign currency translation ( | $ 4,664 | $ (8,252) | $ 7,010 | $ (28,318) | |||
Effect of foreign currency translation (%)(1) | 2.0 % | (4.0) % | 0.8 % | (3.6) % | |||
Revenue constant currency growth rate | 16.3 % | 14.3 % | 16.0 % | 14.2 % | |||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Commerce revenue, as reported | $ 82,285 | $ 71,983 | $ 307,987 | $ 269,672 | |||
Revenue year-over-year growth rate, as reported | 14.3 % | 12.1 % | 14.2 % | 17.5 % | |||
Effect of foreign currency translation ( | $ 796 | $ (1,451) | $ 1,204 | $ (4,960) | |||
Effect of foreign currency translation (%)(1) | 1.1 % | (2.3) % | 0.4 % | (2.2) % | |||
Commerce constant currency growth rate | 13.2 % | 14.4 % | 13.8 % | 19.7 % | |||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Presence revenue, as reported | $ 188,433 | $ 156,829 | $ 704,349 | $ 597,300 | |||
Revenue year-over-year growth rate, as reported | 20.2 % | 9.5 % | 17.9 % | 7.7 % | |||
Effect of foreign currency translation ( | $ 3,867 | $ (6,801) | $ 5,806 | $ (23,358) | |||
Effect of foreign currency translation (%)(1) | 2.5 % | (4.7) % | 1.0 % | (4.2) % | |||
Presence constant currency growth rate | 17.7 % | 14.2 % | 16.9 % | 11.9 % | |||
(1) To calculate the effect of foreign currency translation, we apply the same weighted monthly average exchange | |||||||
Amounts may not sum due to rounding. | |||||||
SUMMARY OF SHARES OUTSTANDING | |||
Years Ended December 31, | |||
2023 | 2022 | ||
Shares outstanding: | |||
Class A common stock | 88,545,012 | 87,754,534 | |
Class B common stock | 47,844,755 | 47,844,755 | |
Class C common stock | 0 | 0 | |
Total shares outstanding | 136,389,767 | 135,599,289 | |
KEY PERFORMANCE INDICATORS AND NON-GAAP FINANCIAL MEASURES | |||||||
Three Months Ended December 31, | Years Ended December 31, | ||||||
2023 | 2022 | 2023 | 2022 | ||||
Unique subscriptions (in thousands) | 4,631 | 4,204 | 4,631 | 4,204 | |||
Total bookings (in thousands) | $ 286,123 | $ 232,145 | $ 1,075,096 | $ 906,056 | |||
ARRR (in thousands) | $ 1,105,743 | $ 931,708 | $ 1,105,743 | $ 931,708 | |||
ARPUS | $ 228.02 | $ 209.16 | $ 228.02 | $ 209.16 | |||
Adjusted EBITDA (in thousands) | $ 64,697 | $ 63,108 | $ 235,404 | $ 147,499 | |||
Unlevered free cash flow (in thousands) | $ 65,021 | $ 41,516 | $ 241,013 | $ 165,550 | |||
GMV (in thousands) | $ 1,654,126 | $ 1,556,004 | $ 6,211,823 | $ 6,058,832 | |||
Unique subscriptions and average revenue per unique subscription ("ARPUS") do not account for single domain | |||||||
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SOURCE Squarespace, Inc.
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