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Zenvia Reports Q2 2022 Results

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On August 15, 2022, Zenvia Inc. (NASDAQ: ZENV) reported a 50% year-over-year increase in net revenues, totaling BRL 203.9 million in Q2 2022. Adjusted gross margin expanded by 500 basis points to 37.8%. The company's client base grew by 37%, and adjusted gross profit rose by 72.6%. Zenvia is implementing a new revenue breakdown model to improve transparency across its SaaS and CPaaS sectors. Despite challenges in the tech environment, Zenvia reaffirms its full-year guidance, expecting revenues between BRL 875 million and BRL 925 million.

Positive
  • Net revenues increased by 50% YoY to BRL 203.9 million in Q2 2022.
  • Adjusted gross margin expanded by 500bps to 37.8%.
  • Client base grew by 37% YoY, enhancing market presence.
  • Adjusted gross profit rose by 72.6% to BRL 77 million.
  • Strong revenue growth from both organic growth and M&A integration.
Negative
  • Negative non-GAAP adjusted EBITDA of BRL 22.7 million for H1 2022.

Strong top-line increase from organic growth and M&A integration

Net Revenues up 50% YoY with Adjusted Gross Margin expanding 500bps to 38% in Q2

Numbers are within the full-year guidance range

New reporting breakdown by SaaS and CPaaS to increase transparency and simplify understanding

SÃO PAULO, Aug. 15, 2022 /PRNewswire/ -- Zenvia Inc. (NASDAQ: ZENV), the leading cloud-based CX communications platform in Latin America, empowering companies to transform their existing communications with end customers along their life cycle, today reported its second quarter of 2022 operational and financial metrics.

Cassio Bobsin, Founder & CEO of ZENVIA, said: "A couple of weeks ago, we held an Investor Day on Nasdaq where we shared our long-term strategy and how we envision the future of Customer Experience (CX). We believe that since the rise of civilization and modern society, we've been building organizations based on processes designed for scale and efficiency. This was a great achievement of the industrial revolution. The world is in process of transformation, and value creation has shifted from production efficiency to customer efficiency. Humans are not designed to interact with bureaucratic organizations. We are designed to interact with other human beings. Ultimately, people should be able to talk to companies as if they were also humans. That's why Zenvia is shaping a new world of experiences."

Shay Chor, CFO & IRO of ZENVIA, said: "Starting Q2 2022, and similar to the approach of our Investor Day, we will break down revenues, gross profit and margin by SaaS and CPaaS, our two main business lines. This breakdown will allow for a deeper glimpse into our business and is more aligned with how we understand and manage our company, especially following the organizational restructuring announced last June. It also demonstrates that we are effectively a SaaS company as over half of our gross margin already comes from the software business. As we finished up the first half of 2022, Zenvia is smarter and more robust than ever. Our top-line and gross margin results attest that we are on the right path to creating value. Our client base grew 37%, bringing revenues up 50%, while our adjusted gross profit rose 73% and the gross margin jumped 500bps. We just started cross-selling our solutions and tools to a growing client base. R&D expenses also grew to represent about 12% of revenues. We expect these expenses to remain at this level for the next couple of years, following the launch of new products that will significantly leverage our growth and market positioning. And, despite the current uncertain environment and the challenges involving tech companies, we are reaffirming our guidance for the year."  

Key Financial Metrics

Q2 2022

Q2 2021

YoY

H1 2022

H1 2021

YoY

Total Customers

14,740

10,773

36.8 %

14,740

10,773

36.8 %

Net Revenues (BRL MM)

203.9

135.7

50.3 %

401.5

258.3

55.4 %

Adjusted Gross Profit (BRL MM)

77.0

44.6

72.6 %

143.8

78.0

84.3 %

Adjusted Gross Margin

37.8 %

32.9 %

5.0p.p.

35.8 %

30.2 %

5.6p.p.

 

Key operating highlights

  • We unified our portfolio:  Zenvia Attraction, Zenvia Conversion, Zenvia Service and Zenvia Success, unified on our Quantum platform to break down all CX barriers and unlock the true potential for end customers 
  • We closed the Movidesk acquisition on May 2nd, 2022, adding 2,500 customers, with an Annual Recurring Revenue (ARR) of BRL 46 million. We expect to fully integrate Movidesk in a twelve-month period ending May 2023.
  • Integration of D1 and SenseData is moving as expected, with cross-selling solutions being already delivered to some of our customers. We expect to fully integrate these businesses by the end of 2022.
  • Last June, we announced a tactical reorganization of our business structure, with fully-dedicated teams to focus on strengthening its three existing business lines - SaaS, CPaaS, and Consulting – thus allowing for more autonomy when it comes to revenue generation activities.

Our Business Lines 
To better reflect the current stage of our business and align with the recent reorganization of our corporate structure, starting this quarter we will report a revenue breakdown by SaaS and CPaaS, instead of SMS and  Beyond SMS. We believe this change will allow all stakeholders to better understand our business and growth levers.

According to IDC, the total addressable market (TAM) in Latin America for SaaS will be $5.4 billion in 2026, growing from $3.2 billion in 2021, while the CPaaS will grow from $0.9 billion in 2021 to $3.6 billion in 2026. Both markets will sum up to $9.0 billion in 2026, from $4.0 billion in 2021.

SaaS Business 
The SaaS business line carries higher gross margins and is the business from where most of our growth will come in the future. During the IPO, we practically only had Zenvia Conversion and communication channels as part of our offering. Twelve months later, Zenvia is talking directly with the marketing and sales departments, acting along the entire customer experience journey. More than half of our margin already comes from our solutions, when nearly three years ago this percentage was zero.

SaaS Key Operational & Financial Metrics

Q2 2022

H1 2022

Total Customers

6,593

6,593

Net Revenues (BRL MM)

64.5

116.4

Adjusted Gross Margin

68.5 %

66.5 %

Net Revenue Expansion (NRE)

120 %

120 %

According to IDC, Zenvia was already among Latin America's top 10 SaaS players by the end of 2021, with 2.2% of market share. This means we have already changed the customer experience of over 40 million people in LatAm with our SaaS solutions, compared to a total population of 925 million in the region, which means that we can still change the experience of 95% of them.

The Latin American SaaS market is expected to reach US$5.4 billion in value by 2026, with a market size of $2.2 billion, and a CAGR of 12.0% and 19.3%, respectively. Our SaaS revenues have been growing faster than the market as we gain market share. Our products are designed to solve the pains of LatAm businesses, from price point to suitability, giving us a competitive advantage. Our offering competes with global suites that are not tropicalized for local needs and are usually charged in US dollars. Furthermore, our offering off-the shelf promotes an easy adoption and a short sales cycle.

Our SaaS Portfolio 
Since our IPO a year ago, Zenvia has evolved its product portfolio organically and through acquisitions. Our platform now provides four SaaS solutions designed for each phase of customers' journey, starting with the first interaction with the brand and all the way to a continuous relationship with the company.

Solution

Former

Focus

Zenvia Attraction

Zenvia Campaign

Active end-customer acquisition campaigns

Zenvia Conversion

Sirena

Converting leads into sales using multiple communication channels

Zenvia Service

Movidesk

Enabling companies to provide amazing customer service with structured support across multiple channels

Zenvia Success

Sensedata

Enabling companies to continuously engage customers based on their individual context, promoting healthy and long-lasting relationships, transforming data into insights

Our SaaS solutions can be used alone or combined, allowing companies to start a program in a really simple way in a matter of minutes, or they can go all the way to a fully integrated, automated, and intelligent customer journey. We also provide CX Tools that can be used to integrate and automate the customer experiences in various ways. Our main tools are APIs, Bots, Natural-language understanding (NLU) and Docs. The Quantum platform connects all our solutions and tools with the client's systems and processes. Companies can access our platform and start choosing from any solution or tool. As they go deeper into adopting multiple parts of the platform, we can break down all CX barriers and unlock the true potential for end customers.

CPaaS Business

CPaaS Key Operational & Financial Metrics

Q2 2022

H1 2022

Total Customers

8,647

8,647

Net Revenues (BRL MM)

139.4

285.1

Adjusted Gross Margin

22.9 %

22.9 %

The population in Latin America is highly connected and a heavy user of social media and social networks. This leads companies to centralize the communication with end customers through these digital channels, mainly WhatsApp and Instagram, which are the most popular and widely used. Even though SMS is still currently responsible for most of the CPaaS volume in the region, WhatsApp and Instagram are growing at a much faster pace.

To reach the population through multiple channels, companies need to

  1. Use communications application programming interfaces (APIs), to enhance customer engagement, notifications, service management, marketing automation and business intelligence applications
  2. Apply real-time communications solutions that are easy to create and scalable.
  3. Simplify the process of embedding programmable voice and messaging applications, creating cost-effective and agile enterprise cloud applications

According to IDC, Zenvia was the top CPaaS player in Latin America by the end of 2021, with 13% of market share. The CPaaS Latin American market is expected to multiply by roughly 3x, reaching $3.1 billion in size and $3.5 billion in TAM by 2026. It means that although the addressable market is expected to continue growing at an accelerated pace, white space is limited. We expect to maintain our leadership position.

Financial Results

Consolidated Revenue 
Consolidated Revenue in Q2 2022 totaled BRL 203.9 million, up 50.3% YoY, reflecting solid organic growth and M&A gains.

During H1 2022, consolidated revenues amounted to R$401.5 million, up 55.4% YoY, and an organic growth rate of 28.2%. This reflects a higher number of active customers (+37% YoY) and strong growth of our SaaS business. The H1 2022 results fully consolidate D1 and SenseData acquisitions and consider only two months of Movidesk, which jointly contributed with BRL 70.4 million to our consolidated net revenues.

Profitability 
Adjusted Gross Profit increased 72.7% in the quarter to BRL 77.0 million, reflecting the strong revenue growth and improved mix, while Adjusted Gross Margin expanded 500bps to 37.8%. Sequentially, Adjusted Gross Margin was up 400bps due to the better mix of SaaS services and the two-month contribution of Movidesk's acquisition.

For H1 2022, Adjusted Gross Profit rose 84.3% to BRL 143.8 million, while Adjusted Gross Margin expanded 570bps to 35.8%.

Non-GAAP Adjusted EBITDA in the first six months of the year was negative BRL 22.7 million, including higher R&D expenses and the earn-out expenses related to the acquisitions of SenseData and Sirena. Excluding these expenses, our Normalized EBITDA in H1 2022 was negative BRL 9.0 million.

Reiterating Guidance



FY 2022
Guidance


Revenue (millions)(1)


BRL $875 - $925



     Y/Y Growth


43% - 51%



     Organic Y/Y Growth(2)



32% - 34%



     CPaaS Revenue



BRL $600 - $620



     SaaS Revenue



BRL $275 - $305



Adjusted Gross Margin


35.0% - 36.0%



     Y/Y Expansion


2.7p.p. - 3.7p.p.



     CPaaS Adj Gross Profit


~22%



     SaaS Adj Gross Profit


~65%










 

Conference Call 
The Company will host a webcast on August 16, 2022, at 10:00 am EDT to discuss its operational and financial metrics. To access the webcast presentation, click here.

Additional information regarding Zenvia can be found at https://investors.zenvia.com.

Click here to see our full Investor Day Video Presentation or go to our investor relations website, in the events section, at the following link: https://investors.zenvia.com/news-events/company-events/

Contacts

Investor Relations

Caio Figueiredo

Fernando Schneider

ir@zenvia.com

Media Relations – Grayling

Lucia Domville – (646) 824-2856 – lucia.domville@grayling.com

Fabiane Goldstein – (954) 625-4793 – fabiane.goldstein@grayling.com

 

 

 

 

About ZENVIA 
ZENVIA is driven by the purpose of empowering companies to create unique experiences for customer communications through its unified end-to-end platform. ZENVIA empowers companies to transform their existing customer communications from non-scalable, physical and impersonal interactions into highly scalable, digital-first and hyper-contextualized experiences across the customer journey. ZENVIA's unified end-to-end CX communications platform provides a combination of (i) SaaS focused on campaigns, sales teams, customer service and engagement, (ii) tools, such as software application programming interfaces, or APIs, chatbots, single customer views, journey designers, documents composer and authentication and (iii) channels, such as SMS, Voice, WhatsApp, Instagram and Webchat. Its comprehensive platform assists customers across multiple use cases, including marketing campaigns, customer acquisition, customer onboarding, warnings, customer services, fraud control, cross-selling and customer retention, among others. ZENVIA's shares are traded on Nasdaq under the ticker ZENV.

Forward-Looking Statements 
The preliminary second quarter operating results set forth above are based solely on currently available information, which is subject to change. These preliminary operating results constitute forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts, and projections, as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," variations of these terms or the negative of these terms and similar expressions are intended to identify these statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Zenvia's control. Zenvia's actual results could differ materially from those stated or implied in forward-looking statements due to several factors, including but not limited to: our ability to innovate and respond to technological advances, changing market needs and customer demands, our ability to successfully acquire new businesses as customers, acquire customers in new industry verticals and appropriately manage international expansion, substantial and increasing competition in our market, compliance with applicable regulatory and legislative developments and regulations, the dependence of our business on our relationship with certain service providers, among other factors.

SELECTED FINANCIAL DATA


Q2 2022

H1 2022


2022

2021

Variation

2022

2021

Variation


(non-audited)

(non-audited)

(non-audited)

(non-audited)


(in thousands of R$)

( %)

(in thousands of R$)

( %)

Revenue

203,897

135,652

50.3 %

401,478

258,345

55.4 %

Cost of services

-137,849

-94,186

46.4 %

-276,006

-186,586

47.9 %

Gross profit

66,048

41,466

59.3 %

125,472

71,759

74.9 %

Selling and marketing expenses

-30,771

-22,822

34.8 %

-56,190

-38,200

47.1 %

Administrative expenses

-39,607

-14,467

173.8 %

-74,340

-47,189

57.5 %

Research and development expenses

-15,883

-6,000

164.7 %

-29,193

-11,009

165.2 %

Allowance for credit losses

-1,957

-1,656

18.2 %

-3,997

-3,246

23.1 %

Other income and expenses, net

-11,826

-289

n.m.

-19,984

-181

n.m.

Operating profit

-33,996

-3,768

802.2 %

-58,232

-28,066

107.5 %

Finance costs

-17,860

-9,310

91.8 %

-31,478

-26,969

16.7 %

Finance income

9,650

15,739

-38.7 %

21,550

18,665

15.5 %

Net finance costs

-8,210

6,429

-227.7 %

-9,928

-8,304

19.6 %

Loss before income tax and social contribution

-42,206

2,661

n.m.

-68,160

-36,370

87.4 %

Deferred income tax and social contribution

10,936

-969

-1228.6 %

15,885

9,657

64.5 %

Current income tax and social contribution

-703

-562

25.1 %

-723

-632

14.4 %

Loss for the period

-31,973

1,130

n.m.

-52,998

-27,345

93.8 %

 


Q2

H1

2022

(non-audited)

2021

(non-audited)

2022

(non-audited)

2021

(non-audited)

(in thousands of R$)

Net cash from (used in) operating activities

29,843

18,225

13,422

-25,539

Net cash used in investing activities

-311,519

-22,763

-319,423

-27,414

Net cash from (used in) financing activities

959

-15,742

-135,207

68,031

Exchange rate change on cash and cash equivalents

9,279

937

-20,864

1,412

Net (decrease) increase in cash and cash equivalents

-271,438

-19,343

-462,072

16,490

 

(in thousands of R$)

June 30, 2021

(non-audited)

December 31, 2021

(audited)

June 30, 2022

(non-audited)

Assets




Current assets

216,850

766,059

309,142

Cash and cash equivalents

76,469

582,231

120,159

Trade and other receivables

99,798

142,407

150,792

Tax assets

8,602

15,936

25,840

Derivative and Financial instruments

-

74

-

Prepayments

8,774

20,918

4,645

Other assets

2,207

4,493

7,706

Advances to Acquisitions

21,000

-

-





Non-current assets

287,172

1,077,790

1,581,499

Tax assets

138

112

170

Prepayments

2,224

2,271

3,097

Interest earning bank deposits

-

7,005

7,509

Property, plant and equipment

11,621

15,732

21,733

Intangible assets and goodwill

273,189

1,050,357

1,532,490

Deferred Tax Assets

-

2,276

16,415

Other Assets

-

37

85





Total assets

504,022

1,843,849

1,890,641

 

 

(in thousands of R$)

June 30, 2021

(non-audited)

December 31, 2021

(audited)

June 30, 2022

(non-audited)

Liabilities




Current liabilities

242,527

429,883

418,165

Loans and borrowings

43,521

64,415

68,906

Trade and other payables

102,945

144,424

182,319

Liabilities from acquisitions

68,281

176,069

100,791

Tax liabilities

8,972

15,736

15,307

Employee benefits

16,863

21,926

34,426

Lease liabilities

1,118

2,220

2,203

Deferred revenue

-

4,582

13,756

Taxes to be paid in installments

-

511

457

Derivative and Financial Instruments

827

-

-





Non-current liabilities

171,466

210,764

325,675

Liabilities from acquisitions

27,917

60,220

191,199

Trade and other payables

1,990

936

715

Loans and borrowings

125,706

143,723

129,132

Lease liabilities

1,125

2,038

3,662

Provisions for tax, labor and civil risks

1,590

1,369

419

Deferred tax liabilities

13,138

1,756

-

Taxes to be paid in installments

-

722

548





Equity

90,029

1,203,202

1,146,801

Capital

6

957,523

957,524

Reserves

87,760

226,599

258,149

Translation reserve

520

34,638

-

Accumulated losses

1,743

(15,558)

(68,540)

Non-controlling interests

-

-

(331)

Total equity and liabilities

504,022

1,843,849

1,890,641

 


Q2

H1


2022

(non-audited)

2021

(non-audited)

2022

(non-audited)

2021

(non-audited)


(in thousands of R$)

Gross profit

66,048

41,466

125,472

71,759

(+) Amortization of intangible assets acquired from business combinations

10,969

3,142

18,377

6,284

Non-GAAP Gross Profit

77,017

44,608

143,849

78,043

Revenue

203,897

135,652

401,478

258,345

Gross margin

32.4 %

30.6 %

31.3 %

27.8 %

Non-GAAP Gross Margin

37.8 %

32.9 %

35.8 %

30.2 %

 


Q2

H1


2022

(non-audited)

2021

(non-audited)

2022

(non-audited)

2021

(non-audited)


(in thousands of R$)

EBITDA

-22,660

4,540

-24,743

-11,766

(+) Expenses related to IPO grants

1,394

-5,044

2,035

1,951

Adjusted EBITDA

-21,266

-504

-22,708

-9,815

 


Interest
(% p.a.)

June 30, 2022

December 31, 2021

June 30, 2021

                                                                                       (in thousands of R$)

Working capital

From CDI +2.40%
to CDI + 5.46%
and Fixed
Between 8.60%
and 12.95%

153,038

163,138

169,227

Debentures

18.16 %

45,000

45,000

Total


198,038

208,138

169,227

 

Cision View original content:https://www.prnewswire.com/news-releases/zenvia-reports-q2-2022-results-301606050.html

SOURCE Zenvia

FAQ

What were Zenvia's net revenues in Q2 2022?

Zenvia's net revenues in Q2 2022 totaled BRL 203.9 million, marking a 50% increase year-over-year.

How much did Zenvia's gross margin expand in Q2 2022?

In Q2 2022, Zenvia's adjusted gross margin expanded by 500 basis points to 37.8%.

What is Zenvia's full-year revenue guidance for 2022?

Zenvia's full-year revenue guidance for 2022 is between BRL 875 million and BRL 925 million.

How many customers does Zenvia have as of Q2 2022?

As of Q2 2022, Zenvia has a total of 14,740 customers.

What is the expected growth for Zenvia's SaaS business?

Zenvia's SaaS business is expected to continue growing rapidly, with adjusted gross profit from SaaS solutions projected at around 65%.

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