Urgently Announces Fourth Quarter and Full-Year 2023 Financial Results
- Acquisition of Otonomo and Nasdaq listing in 2023.
- 88% increase in gross profit and 10-point margin improvement.
- Reduction of principal debt balance from $142.2 million to $54.3 million.
- Q4 revenue decrease by 13% year over year.
- Significant actions taken to right size the organization and enhance capital structure.
- Decrease in Q4 revenue by 13% year over year.
- Significant increase in GAAP operating loss in Q4.
- Reduction in revenue for fiscal year 2023 by 2% year over year.
Insights
The reported financials from Urgent.ly Inc. indicate a mixed performance. While the gross profit increase of 88% and 10-point margin improvement are positive indicators of cost management and operational efficiency, the revenue decline of 2% year over year for the full fiscal year raises concerns. A revenue decrease can often signal a reduction in market demand or competitive pressures, which may require strategic adjustments.
Moreover, the significant reduction in net principal debt from $142.2 million to $71.8 million demonstrates a concerted effort to improve the balance sheet and reduce financial risk. This proactive approach to capital management can be favorable for the company's credit profile and future investment prospects. However, the increase in GAAP and non-GAAP operating losses year over year for the fourth quarter suggests that there might be underlying issues that could affect the company's profitability in the short term.
Urgent.ly's acquisition of Otonomo and its public listing are strategic moves that could potentially open up new markets and revenue streams. These developments, along with the reported consumer satisfaction score of 4.6 out of 5 stars, suggest that the company is focused on customer service quality, which is a critical factor in the digital roadside and mobility assistance industry.
Despite the reported decrease in revenue, the increase in gross margins indicates that Urgent.ly is becoming more efficient in its operations. However, it's important to consider the competitive landscape and the potential impact of economic factors on consumer spending in the mobility assistance sector. The company's ability to continue expanding its margins in a challenging economic environment will be key to its long-term success.
The aggressive debt reduction strategy that Urgent.ly has undertaken is noteworthy. Reducing the principal debt balance by over $87.9 million in a year is a significant achievement that can improve the company's interest expense and overall financial health. Extending the maturity date of the remaining debt also indicates that the company has successfully negotiated with creditors to secure more favorable terms, which can provide additional financial flexibility.
However, it is crucial to analyze the source of funds used for debt repayment. If the repayment is largely driven by cash on hand, it may impact the company's liquidity position and its ability to invest in growth opportunities. Stakeholders should closely monitor the company's cash flow statements in subsequent quarters to assess the sustainability of its capital structure enhancements.
Company Continues to Make Progress on Strategic Initiatives to Enhance Profitability and Drive Margin Expansion
VIENNA, Va., March 14, 2024 (GLOBE NEWSWIRE) -- Urgent.ly Inc. (Nasdaq: ULY) (“Urgently”), a U.S.-based leading provider of digital roadside and mobility assistance technology and services, today reported financial results for the fourth quarter and full-year ended December 31, 2023.
“Overall, I am pleased with our significant accomplishments in 2023, which included the acquisition of Otonomo, our public listing on Nasdaq, and financial results that were in line with our expectations. Our team made great progress in executing against our strategic initiatives to drive profits, operation efficiencies and disciplined expense management during the year, as evidenced by our
Tim Huffmyer, CFO of Urgently, added, “In January 2024, we took steps to enhance our capital structure by using cash on hand to repay
Fourth Quarter 2023 Highlights:
- Revenue of
$45.1 million , a decrease of13% year over year. - Gross profit of
$10.2 million , an increase of21% year over year. - Gross margin of
23% compared to16% from the prior year period. - GAAP operating loss of
$23.8 million compared to GAAP operating loss of$8.4 million from the prior year period, an increase of182% . - Non-GAAP operating loss of
$7.9 million compared to non-GAAP operating loss of$6.5 million from the prior year period, an increase of21% . - Net principal debt reduction of
$70.4 million from$142.2 million to$71.8 million . - Approximately 269,000 dispatches completed.
- Consumer satisfaction score of 4.6 out of 5 stars.
Fiscal Year 2023 Highlights:
- Revenue of
$184.7 million , a decrease of2% year over year. - Gross profit of
$37.9 million , an increase of88% year over year. - Gross margin of
21% compared to11% from the prior year period. - GAAP operating loss of
$46.1 million compared to GAAP operating loss of$53.6 million from the prior year period, a reduction of14% . - Non-GAAP operating loss of
$21.0 million compared to non-GAAP operating loss of$48.6 million from the prior year period, a reduction of57% . - Net principal debt reduction of
$55.7 million from$127.5 million to$71.8 million . - Approximately 1,148,000 dispatches completed.
- Consumer satisfaction score of 4.6 out of 5 stars.
Earnings Conference Call and Audio Webcast
Urgently will host a conference call to discuss the fourth quarter and full-year 2023 financial results on March 14, 2024 at 5:00 p.m. Eastern Time. The conference call can be accessed live over the phone by dialing 1-844-825-9789 (USA) or 1-412-317-5180 (International). The conference call replay will be available from 8:00 p.m. Eastern Time on March 14, 2024, through March 28, 2024, by dialing 1-844-512-2921 (USA) or 1-412-317-6671 (International). The replay passcode will be 10186556.
The call will also be webcast live from Urgently’s investor relations website at https://investors.geturgently.com. Following the completion of the call, a recorded replay of the webcast will be available on the website.
About Urgently
Urgently keeps vehicles and people moving by delivering safe, innovative, and exceptional mobility assistance experiences. The company’s digitally native software platform combines location-based services, real-time data, AI and machine-to-machine communication to power roadside assistance solutions for leading brands across automotive, insurance, telematics and other transportation-focused verticals. Urgently fulfills the demand for connected roadside assistance services, enabling its partners to deliver exceptional user experiences that drive high customer satisfaction and loyalty, by delivering innovative, transparent and exceptional connected mobility assistance experiences on a global scale. For more information, visit www.geturgently.com.
For media and investment inquiries, please contact:
Press: media@geturgently.com
Investor Relations: investorrelations@geturgently.com
Non-GAAP Financial Measures
In addition to our financial information presented in accordance with GAAP, we believe Non-GAAP Operating Loss is useful to investors in evaluating our operating performance. We use the non-GAAP financial measure to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that the non-GAAP financial measure, when taken together with the corresponding GAAP financial measure, may be helpful to investors because it provides consistency and comparability with past financial performance and meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. The non-GAAP financial measure is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP and may be different from a similarly-titled non-GAAP financial measure used by other companies. In addition, other companies, including companies in our industry, may calculate a similarly-titled non-GAAP financial measure differently or may use other measures to evaluate their performance, which could reduce the usefulness of the non-GAAP financial measure presented herein as a tool for comparison.
A reconciliation is provided below for the non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measure and the reconciliation of the non-GAAP financial measure to our most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business. We define Non-GAAP Operating Loss as operating loss, excluding depreciation and amortization expense, stock-based compensation expense, and non-recurring charges (or income) such as transaction and restructuring costs.
For a discussion of Non-GAAP Operating Expenses, please see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Urgently’s Annual Report on Form 10-K for the year ended December 31, 2023, which will be filed with the SEC by April 1, 2024.
Forward Looking Statements
This press release contains or may contain “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or Urgently’s future financial or operating performance. Such statements are based upon current plans, estimates and expectations of management of Urgently in light of historical results and trends, current conditions and potential future developments, and are subject to various risks and uncertainties that could cause actual results to differ materially from such statements. The inclusion of forward-looking statements should not be regarded as a representation that such plans, estimates and expectations will be achieved. Forward-looking terms such as “may,” “will,” “could,” “should,” “would,” “plan,” “potential,” “intend,” “anticipate,” “project,” “predict,” “target,” “believe,” “continue,” “estimate” or “expect” or the negative of these words or other words, terms and phrases of similar nature are often intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. All statements, other than historical facts, including, without limitation, statements regarding Urgently’s profitability; the expected benefits of the Merger; the market position of the combined company against current and future competitors; and any assumptions underlying any of the foregoing, are forward-looking statements.
There are a significant number of factors that could cause actual results to differ materially from statements made in this press release and our earnings call, including but not limited to: risks associated with our ability to raise funds through future financings and the sufficiency of our cash and cash equivalents to meet our liquidity needs; our history of losses; our limited operating history; our ability to integrate and realize potential benefits from the Merger; our ability to service our debt and comply with our debt agreements; our ability to retain customers and expand existing customers’ use of our platform; our ability to attract new customers; our ability to expand into new solutions, technologies and geographic regions; our ability to adequately forecast consumer demand and optimize our network of service providers; our ability to compete in the markets in which we participate; our ability to comply with laws and regulations applicable to our business; the ongoing review of our financial statements by our auditors and the potential for further adjustments identified in connection with the completion of audit procedures; and expectations regarding the impact of weather events, natural disasters or health epidemics, including the COVID-19 pandemic and the war between Hamas and Israel, on our business. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in our filings with the Securities and Exchange Commission, including in our Registration Statement on Form S-1, as amended, which was declared effective by the SEC on October 19, 2023 (the “Registration Statement”), our quarterly reports on Form 10-Q, and other filings and reports that we may file from time to time with the SEC. Forward-looking statements represent our beliefs and assumptions only as of the date of this press release. We disclaim any obligation to update forward-looking statements.
Consolidated Balance Sheets
(in thousands)
(unaudited)
| December 31, 2023 | December 31, 2022 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 38,256 | $ | 7,407 | ||||
| Marketable securities and short-term deposits | 31,355 | — | ||||||
| Accounts receivable, net | 33,905 | 33,966 | ||||||
| Prepaid expenses and other current assets | 4,349 | 2,102 | ||||||
| Total current assets | 107,865 | 43,475 | ||||||
| Right-of-use assets | 2,437 | 2,485 | ||||||
| Property and equipment, net | 871 | 414 | ||||||
| Intangible assets, net | 9,283 | 31 | ||||||
| Other non-current assets | 738 | 538 | ||||||
| Total assets | $ | 121,194 | $ | 46,943 | ||||
| Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 4,478 | $ | 7,536 | ||||
| Accrued expenses and other current liabilities | 22,730 | 20,160 | ||||||
| Current lease liabilities | 710 | 740 | ||||||
| Current portion of long-term debt, net | 3,193 | — | ||||||
| Total current liabilities | 31,111 | 28,436 | ||||||
| Long-term lease liabilities | 2,045 | 2,120 | ||||||
| Long-term debt, net | 66,076 | 99,443 | ||||||
| Other long-term liabilities | 12,358 | 51,781 | ||||||
| Total liabilities | 111,590 | 181,780 | ||||||
| Redeemable convertible preferred stock | — | 46,334 | ||||||
| Stockholders’ equity (deficit): | ||||||||
| Common stock | 13 | — | ||||||
| Additional paid-in capital | 164,920 | 48,327 | ||||||
| Accumulated other comprehensive loss | (560 | ) | — | |||||
| Accumulated deficit | (154,769 | ) | (229,498 | ) | ||||
| Total stockholders’ equity (deficit) | 9,604 | (181,171 | ) | |||||
| Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) | $ | 121,194 | $ | 46,943 | ||||
Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Revenue | $ | 45,051 | $ | 51,966 | $ | 184,653 | $ | 187,589 | ||||||||
| Cost of revenue | 34,867 | 43,572 | 146,772 | 167,442 | ||||||||||||
| Gross profit | 10,184 | 8,394 | 37,881 | 20,147 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 5,830 | 3,782 | 16,907 | 16,733 | ||||||||||||
| Sales and marketing | 2,219 | 1,372 | 5,065 | 5,647 | ||||||||||||
| Operations and support | 5,690 | 7,975 | 24,355 | 36,893 | ||||||||||||
| General and administrative | 19,453 | 3,614 | 36,668 | 14,129 | ||||||||||||
| Depreciation and amortization | 792 | 76 | 990 | 297 | ||||||||||||
| Total operating expenses | 33,984 | 16,819 | 83,985 | 73,699 | ||||||||||||
| Operating loss | (23,800 | ) | (8,425 | ) | (46,104 | ) | (53,552 | ) | ||||||||
| Other income (expense), net: | ||||||||||||||||
| Interest expense, net | (6,683 | ) | (10,930 | ) | (46,291 | ) | (31,447 | ) | ||||||||
| Change in fair value of derivative and warrant liabilities | 38,245 | (13,802 | ) | 43,293 | (9,886 | ) | ||||||||||
| Change in fair value of accrued purchase consideration | 1,615 | — | 1,615 | — | ||||||||||||
| Gain on debt extinguishment | 42,034 | — | 46,947 | — | ||||||||||||
| Bargain purchase gain | 73,410 | — | 73,410 | — | ||||||||||||
| Other income (expense), net | 788 | (60 | ) | (281 | ) | (1,097 | ) | |||||||||
| Total other income (expense), net | 149,409 | (24,792 | ) | 118,693 | (42,430 | ) | ||||||||||
| Income (loss) before income taxes | 125,609 | (33,217 | ) | 72,589 | (95,982 | ) | ||||||||||
| Provision for income taxes | (2,140 | ) | — | (2,140 | ) | — | ||||||||||
| Net income (loss) | $ | 127,749 | $ | (33,217 | ) | $ | 74,729 | $ | (95,982 | ) | ||||||
| Earnings (loss) per share: | ||||||||||||||||
| Basic | $ | 12.13 | $ | (214.64 | ) | $ | 26.98 | $ | (949.36 | ) | ||||||
| Diluted | $ | 11.95 | $ | (214.64 | ) | $ | 25.36 | $ | (949.36 | ) | ||||||
Non-GAAP Financial Measures: Reconciliation of Operating Loss to Non-GAAP Operating Loss
(in thousands)
(unaudited)
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Operating loss | $ | (23,800 | ) | $ | (8,425 | ) | $ | (46,104 | ) | $ | (53,552 | ) | ||||
| Add: Depreciation and amortization expense | 792 | 76 | 990 | 297 | ||||||||||||
| Add: Stock-based compensation expense | 2,251 | 83 | 2,473 | 494 | ||||||||||||
| Add: Non-recurring transaction costs | 12,889 | 1,582 | 21,338 | 2,921 | ||||||||||||
| Add: Restructuring costs | 3 | 162 | 340 | 1,216 | ||||||||||||
| Non-GAAP operating loss | $ | (7,865 | ) | $ | (6,522 | ) | $ | (20,963 | ) | $ | (48,624 | ) | ||||
FAQ
What were Urgent.ly's (ULY) Q4 2023 revenue and gross profit figures?
What was the gross margin for Urgent.ly in Q4 2023?
How did Urgent.ly's (ULY) GAAP operating loss change in Q4 2023 compared to the prior year?
What steps did Urgent.ly take in January 2024 to enhance its capital structure?
What was the consumer satisfaction score for Urgent.ly in fiscal year 2023?
