Tucows Reports Financial Results for Second Quarter 2024
Tucows Inc. (NASDAQ: TCX) (TSX: TC) reported its Q2 2024 financial results, showing strong year-over-year growth in key metrics. Consolidated net revenue increased 5.2% to $89.4 million, while gross profit rose 15.4% to $20.8 million. The company's net loss decreased to $18.6 million ($1.70 per share) from $31.0 million ($2.86 per share) in Q2 2023. Adjusted EBITDA surged 70% to $9.2 million. The improved performance was driven by robust subscriber growth and gross margin increases in Ting, as well as revenue gains from Domains. Tucows continued to deleverage its business using cash flow from Wavelo and Tucows Domains. The company's cash position at the end of Q2 2024 was $52.2 million, down from $79.4 million in Q1 2024.
Tucows Inc. (NASDAQ: TCX) (TSX: TC) ha riportato i risultati finanziari per il secondo trimestre del 2024, evidenziando una forte crescita anno su anno nei principali indicatori. Il fatturato netto consolidato è aumentato del 5,2% a $89,4 milioni, mentre il profitto lordo è cresciuto del 15,4% a $20,8 milioni. La perdita netta dell'azienda è diminuita a $18,6 milioni ($1,70 per azione) rispetto ai $31,0 milioni ($2,86 per azione) del secondo trimestre del 2023. L'EBITDA corretto è aumentato del 70% a $9,2 milioni. Il miglioramento delle performance è stato sostenuto da una forte crescita degli abbonati e dall'aumento del margine lordo in Ting, oltre che dai guadagni sui ricavi provenienti dai Domini. Tucows ha continuato a ridurre il debito usando il flusso di cassa di Wavelo e Tucows Domains. Alla fine del secondo trimestre del 2024, la posizione di cassa dell'azienda era di $52,2 milioni, in calo rispetto ai $79,4 milioni del primo trimestre del 2024.
Tucows Inc. (NASDAQ: TCX) (TSX: TC) reportó sus resultados financieros del segundo trimestre de 2024, mostrando un fuerte crecimiento interanual en métricas clave. Los ingresos netos consolidados aumentaron un 5.2% a $89.4 millones, mientras que la ganancia bruta subió un 15.4% a $20.8 millones. La pérdida neta de la compañía se redujo a $18.6 millones ($1.70 por acción) desde $31.0 millones ($2.86 por acción) en el segundo trimestre de 2023. El EBITDA ajustado se disparó un 70% a $9.2 millones. La mejora en el desempeño fue impulsada por un robusto crecimiento de suscriptores y aumentos en el margen bruto en Ting, así como por ganancias en los ingresos de Dominios. Tucows continuó disminuyendo su deuda utilizando el flujo de caja de Wavelo y Tucows Domains. La posición de efectivo de la compañía al final del segundo trimestre de 2024 era de $52.2 millones, por debajo de los $79.4 millones del primer trimestre de 2024.
Tucows Inc. (NASDAQ: TCX) (TSX: TC)는 2024년 2분기 재무 결과를 발표하며 주요 지표에서 전년 대비 강력한 성장을 보여주었습니다. 통합 순수익은 5.2% 증가하여 8940만 달러에 이르렀고, 총이익은 15.4% 증가하여 2080만 달러에 달했습니다. 회사의 순손실은 1860만 달러($1.70 per share)로 감소했으며, 이는 2023년 2분기 3100만 달러($2.86 per share)에서 감소한 결과입니다. 조정 EBITDA는 70% 급증하여 920만 달러에 도달했습니다. 개선된 성과는 Ting에서의 견고한 가입자 증가와 총 마진 상승에 의해 주도되었으며, 도메인에서의 수익 증가도 포함됩니다. Tucows는 Wavelo 및 Tucows Domains에서 발생하는 현금 흐름을 사용하여 사업의 레버리지를 지속적으로 줄여 나갔습니다. 2024년 2분기 말 회사의 현금 체력은 5220만 달러로, 2024년 1분기 7940만 달러에서 감소한 수치입니다.
Tucows Inc. (NASDAQ: TCX) (TSX: TC) a annoncé ses résultats financiers pour le deuxième trimestre 2024, affichant une forte croissance d'une année sur l'autre dans les indicateurs clés. Le chiffre d'affaires net consolidé a augmenté de 5,2% pour atteindre 89,4 millions de dollars, tandis que le bénéfice brut a grimpé de 15,4% pour atteindre 20,8 millions de dollars. La perte nette de l'entreprise a diminué à 18,6 millions de dollars (1,70 dollar par action) contre 31,0 millions de dollars (2,86 dollars par action) au deuxième trimestre 2023. Le résultat EBITDA ajusté a bondi de 70% pour atteindre 9,2 millions de dollars. La performance améliorée a été soutenue par une croissance robuste des abonnés et des augmentations de la marge brute dans Ting, ainsi que des gains de revenus provenant des Domaines. Tucows a continué à réduire son endettement en utilisant les flux de trésorerie de Wavelo et Tucows Domains. La position de liquidités de l'entreprise à la fin du deuxième trimestre 2024 était de 52,2 millions de dollars, en baisse par rapport à 79,4 millions de dollars au premier trimestre 2024.
Tucows Inc. (NASDAQ: TCX) (TSX: TC) berichtete über die Finanzergebnisse für das zweite Quartal 2024 und wies starkes Wachstum im Jahresvergleich bei den wichtigsten Kennzahlen auf. Der konsolidierte Nettoumsatz stieg um 5,2% auf 89,4 Millionen Dollar, während der Bruttogewinn um 15,4% auf 20,8 Millionen Dollar anstieg. Der Nettoverlust des Unternehmens verringerte sich auf 18,6 Millionen Dollar (1,70 Dollar pro Aktie) von 31,0 Millionen Dollar (2,86 Dollar pro Aktie) im zweiten Quartal 2023. Das bereinigte EBITDA stieg um 70% auf 9,2 Millionen Dollar. Die verbesserte Leistung wurde durch robustes Abonnentenwachstum und Anstiege der Bruttomarge in Ting sowie Umsatzgewinne aus Domains vorangetrieben. Tucows setzte weiterhin auf eine Verringerung der Verschuldung durch den Cashflow von Wavelo und Tucows Domains. Die Liquiditätslage des Unternehmens betrug am Ende des zweiten Quartals 2024 52,2 Millionen Dollar, im Vergleich zu 79,4 Millionen Dollar im ersten Quartal 2024.
- Consolidated net revenue increased 5.2% year-over-year to $89.4 million
- Gross profit rose 15.4% to $20.8 million compared to Q2 2023
- Adjusted EBITDA surged 70% to $9.2 million from $5.4 million in Q2 2023
- Net loss decreased to $18.6 million from $31.0 million in Q2 2023
- Ting showed robust subscriber growth and gross margin increases
- Revenue gains reported from both Ting and Domains segments
- Net loss of $18.6 million ($1.70 per share) despite improvements
- Cash position decreased to $52.2 million from $79.4 million in Q1 2024
- Network depreciation increased as Ting network footprint expands
- Income earned on sale of transferred assets decreased by 22% year-over-year
Insights
Tucows' Q2 2024 results show a mixed financial picture. While revenue increased by
The adjusted EBITDA showed significant improvement, increasing by
Ting Internet Services and Tucows Domain Services showed growth, while Wavelo Platform Services remained relatively flat. The company's focus on deleveraging through debt payments is a positive sign for long-term financial health.
Tucows' performance in Q2 2024 reflects the ongoing evolution of the internet services sector. The company's Ting Internet Services segment showed strong growth, indicating increasing demand for fiber internet. This aligns with the broader trend of expanding high-speed internet infrastructure.
The stability in Wavelo Platform Services revenue suggests a mature SaaS offering, but the slight decline might warrant attention. In the domain services space, Tucows' growth outpaced the industry average, potentially signifying market share gains.
The company's investment in network expansion, evident from the increased network depreciation, is a strategic long-term move. However, it's important to monitor how quickly this translates into revenue growth. The tech sector often requires significant upfront investments and Tucows seems to be following this pattern with its fiber rollout.
Tucows' Q2 2024 results reveal interesting market dynamics across its business segments. The growth in Ting Internet Services suggests strong consumer demand for high-speed fiber internet, likely accelerated by remote work trends. This segment's
In the domain services market, Tucows'
The slight decline in Wavelo Platform Services revenue might signal increased competition in the telecom software space. However, its high gross margins make it a valuable contributor to overall profitability. The company's diverse portfolio across internet infrastructure appears to be a strategic advantage, allowing it to capitalize on various digital transformation trends.
"We finished the second quarter of 2024 with strong year-over-year growth of consolidated revenue, gross profit and adjusted EBITDA, driven by a solid quarter from Ting with robust subscriber growth, gross margin increases and a lower operating loss, which is on track with our expectations," said Elliot Noss, Tucows President and CEO. "We also continued to deleverage the business with payments on the syndicated debt using cash flow from Wavelo and Tucows Domains."
Financial Results
Consolidated net revenue for the second quarter of 2024 increased
Gross profit for the second quarter of 2024 increased
Net loss for the second quarter of 2024 was
Adjusted EBITDA1 for the second quarter of 2024 increased
Cash equivalents, restricted cash and restricted cash equivalents at the end of the second quarter of 2024 were
Summary Financial Results
(In Thousands of US Dollars, Except Per Share Data)
3 Months ended June 30 | 6 Months ended June 30 | |||||
2024 | 2023 | % Change | 2024 | 2023 | % Change | |
Net Revenues | 89,423 | 84,978 | 5 % | 176,880 | 165,408 | 7 % |
Gross Profit | 20,810 | 18,032 | 15 % | 39,126 | 32,093 | 22 % |
Income Earned on Sale of | 3,357 | 4,289 | (22) % | 6,978 | 8,659 | (19) % |
Net Income (Loss) | (18,604) | (30,968) | 40 % | (45,088) | (50,051) | 10 % |
Basic earnings (Loss) per | (1.70) | (2.86) | 41 % | (4.12) | (4.63) | 11 % |
Adjusted EBITDA¹ | 9,178 | 5,395 | 70 % | 13,380 | 8,425 | 59 % |
Net cash provided by (used in) | (4,708) | (1,587) | (197) % | (10,386) | (6,838) | (52) % |
1. This Non-GAAP financial measure is described below and reconciled to GAAP net income in the accompanying table. |
Summary of Revenues, Gross Profit and Adjusted EBITDA
(In Thousands of US Dollars)
Revenue | Gross Margin | Adj. EBITDA¹ | ||||
3 Months ended June 30 | 3 Months ended June 30 | 3 Months ended June 30 | ||||
2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |
Ting Internet Services: | ||||||
Fiber Internet Services | 14,571 | 12,408 | 9,818 | 7,051 | (6,442) | (10,336) |
Wavelo Platform Services: | ||||||
Platform Services | 10,495 | 10,342 | 10,163 | 10,012 | ||
Other Professional Services | 6 | 409 | (1) | 40 | ||
Total Wavelo Platform Services | 10,501 | 10,751 | 10,162 | 10,052 | 3,911 | 3,427 |
Tucows Domain Services: | ||||||
Wholesale | ||||||
Domain Services | 48,504 | 46,782 | 9,583 | 9,492 | ||
Value Added Services | 4,524 | 4,745 | 4,004 | 4,162 | ||
Total Wholesale | 53,028 | 51,527 | 13,587 | 13,654 | ||
Retail | 9,340 | 8,429 | 5,282 | 4,275 | ||
Total Tucows Domain Services | 62,368 | 59,956 | 18,869 | 17,929 | 11,217 | 10,578 |
Corporate: | ||||||
Mobile Services and Eliminations | 1,983 | 1,863 | (754) | (797) | 492 | 1,726 |
Network Expenses: | ||||||
Network, other costs | n/a | n/a | (6,862) | (6,993) | n/a | n/a |
Network, depreciation of property and equipment | n/a | n/a | (10,057) | (8,757) | n/a | n/a |
Network, amortization of intangible assets | n/a | n/a | (366) | (379) | n/a | n/a |
Network, impairment | n/a | n/a | 0 | (74) | n/a | n/a |
Total Network Expenses | n/a | n/a | (17,285) | (16,203) | n/a | n/a |
Total | 89,423 | 84,978 | 20,810 | 18,032 | 9,178 | 5,395 |
1 This Non-GAAP financial measure is described below and reconciled to GAAP net income in the accompanying table. |
Notes:
1. Adjusted EBITDA
Tucows reports all financial information required in accordance with
The Company believes that the provision of this supplemental non-GAAP measure allows investors to evaluate the operational and financial performance of the Company's core business using similar evaluation measures to those used by management. The Company uses adjusted EBITDA to measure its performance and prepare its budgets. Since adjusted EBITDA is a non-GAAP financial performance measure, the Company's calculation of adjusted EBITDA may not be comparable to other similarly titled measures of other companies; and should not be considered in isolation, as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. Because adjusted EBITDA is calculated before certain recurring cash charges, including interest expense and taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a liquidity measure. Non-GAAP financial measures do not reflect a comprehensive system of accounting and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies and/or analysts and may differ from period to period. The Company endeavors to compensate for these limitations by providing the relevant disclosure of the items excluded in the calculation of adjusted EBITDA to net income based on
The Company's adjusted EBITDA definition excludes depreciation, impairment and loss on disposition of property and equipment, amortization of intangible assets, income tax provision, interest expense (net), accretion of contingent consideration, stock-based compensation, asset impairment, gains and losses from unrealized foreign currency transactions, loss on debt extinguishment and costs that are not indicative of on-going performance (profitability), including acquisition and transition costs. Gains and losses from unrealized foreign currency transactions removes the unrealized effect of the change in the mark-to-market values on outstanding unhedged foreign currency contracts, as well as the unrealized effect from the translation of monetary accounts denominated in non-
The following table reconciles income before provision for income taxes to Adjusted EBITDA (dollars in thousands):
3 Months ended June 30 | 6 Months ended June 30 | |||
2024 | 2023 | 2024 | 2023 | |
Net income (Loss) for the period | (18,604) | (30,968) | (45,088) | (50,051) |
Less: | ||||
Provision (recovery) for income taxes | 1,220 | (3,025) | 2,994 | (4,735) |
Depreciation of property and equipment | 10,173 | 8,907 | 20,160 | 17,495 |
Impairment of property and equipment | - | 74 | 53 | 2,016 |
Amortization of intangible assets | 1,201 | 2,609 | 2,880 | 5,481 |
Interest expense, net | 12,553 | 10,501 | 24,432 | 18,381 |
Loss on debt extinguishment | - | 14,680 | - | 14,680 |
Stock-based compensation | 1,702 | 2,052 | 3,575 | 4,298 |
Unrealized loss (gain) on foreign exchange | 164 | (126) | 554 | (84) |
Acquisition and transition costs* | 769 | 691 | 3,820 | 944 |
Adjusted EBITDA | 9,178 | 5,395 | 13,380 | 8,425 |
* Acquisition and other costs represent transaction-related expenses and transitional expenses. Expenses include severance or transitional costs associated with department, operational or overall company restructuring efforts, including geographic alignments. |
Management Commentary
Concurrent with the dissemination of its quarterly financial results news release at 5:05 p.m. ET on Thursday, August 8, 2024, management's pre-recorded audio commentary (and transcript), discussing the quarter and outlook for the Company will be posted to the Tucows website at http://www.tucows.com/investors/financials.
Following management's prepared commentary, for the subsequent seven days, until Thursday, August 15, 2024, shareholders, analysts and prospective investors can submit questions to Tucows' management at ir@tucows.com. Management will post responses to questions in an audio recording and transcript to the Company's website at http://www.tucows.com/investors/financials, on Tuesday, August 27, 2024, at approximately 4 p.m. ET. All questions will receive a response, however, questions of a more specific nature may be responded to directly.
About Tucows
Tucows helps connect more people to the benefit of internet access through communications service technology, domain services, and fiber-optic internet infrastructure. Ting (https://ting.com) delivers fixed fiber Internet access with outstanding customer support. Wavelo (https://wavelo.com) is a telecommunications software suite for service providers that simplifies the management of mobile and internet network access; provisioning, billing and subscription; developer tools; and more. Tucows Domains (https://tucowsdomains.com) manages approximately 25 million domain names and millions of value-added services through a global reseller network of over 35,000 web hosts and ISPs. Hover (https://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows' corporate website (https://tucows.com).
Tucows, Ting, Wavelo, and Hover are registered trademarks of Tucows Inc. or its subsidiaries.
This release includes forward-looking statements as that term is defined in the
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SOURCE Tucows Inc.
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