Domo Announces First Quarter Fiscal 2023 Financial Results

SILICON SLOPES, Utah--()--Domo, Inc. (Nasdaq: DOMO) today announced results for its fiscal first quarter ended April 30, 2022.

Fiscal First Quarter Results

  • Total revenue was $74.5 million, an increase of 24% year over year
  • Subscription revenue was $64.6 million, an increase of 24% year over year
  • Subscription revenue represented 87% of total revenue
  • Billings were $72.9 million or 25% year-over-year growth
  • Remaining Performance Obligations (RPO) was $351.5 million as of April 30, 2022, an increase of 24% year over year
  • RPO expected to be recognized as revenue in the next twelve months was $225.0 million as of April 30, 2022, an increase of 24% year over year
  • Net cash provided by operating activities was $0.8 million
  • GAAP subscription gross margin was 83%, consistent with Q1 FY22
  • Non-GAAP subscription gross margin was 85%, an improvement of 1 percentage point from Q1 FY22
  • GAAP operating margin declined by 14 percentage points year over year
  • Non-GAAP operating margin increased by 4 percentage points year over year
  • GAAP net loss was $32.9 million, and GAAP net loss per share was $0.99, based on 33.3 million weighted-average shares outstanding
  • Non-GAAP net loss was $7.6 million, and non-GAAP net loss per share was $0.23, based on 33.3 million weighted-average shares outstanding
  • Cash and cash equivalents were $84.0 million as of April 30, 2022

In today's environment, business agility remains as important as ever," said John Mellor, CEO, Domo. “Domo is helping companies of all sizes get leverage from their existing resources to reduce costs, improve efficiencies and drive better business outcomes — all at incredible speed. I'm confident in our ability to execute against our opportunity of transforming business by putting data to work for everyone."

Recent Highlights

We believe the following announcements and recognition demonstrate our commitment to product innovation and customer success:

Business Outlook

Based on information available as of May 26, 2022, Domo is providing the following guidance for its second fiscal quarter and full year fiscal 2023:

Q2 Fiscal 2023

  • Revenue is expected to be in the range of $76.0 million to $77.0 million
  • Non-GAAP net loss per share is expected to be between $0.31 and $0.35 based on 33.9 million weighted-average shares outstanding

Full Year Fiscal 2023

  • Revenue is expected to be in the range of $315.0 million to $319.0 million
  • Non-GAAP net loss per share is expected to be between $1.26 and $1.34 based on 34.1 million weighted-average shares outstanding

We have not reconciled guidance for non-GAAP metrics to their most directly comparable GAAP measures because such items that impact these measures are not within our control or cannot be reasonably predicted.

Earnings Call Details

Domo plans to host a conference call today to review its fiscal 2023 first quarter financial results and to discuss its financial outlook. The call is scheduled to begin at 3:00 p.m. MT/ 5:00 p.m. ET. A live webcast of the event will be available on the Domo Investor Relations website at https://www.domo.com/ir. Participants can register for the call in advance by visiting https://conferencingportals.com/event/zYvDlnjs. Instructions will be shared on how to join the call after registering.

A replay will be available at (800) 770-2030 or (647) 362-9199 with conference ID #41576 following the completion of the conference call until 11:59 p.m. (ET) June 9, 2022.

About Domo

Domo transforms business by putting data to work for everyone. Domo’s low-code data app platform goes beyond traditional business intelligence and analytics to enable anyone to create data apps to power any action in their business, right where work gets done. With Domo’s fully integrated cloud-native platform, critical business processes can now be optimized in days instead of months or more. For more information, visit www.domo.com. You can also follow Domo on Twitter, Facebook and LinkedIn.

Domo Disclosure Channels to Disseminate Information

Domo investors and others should note that we announce material information to the public about our company, products and services, and other issues through a variety of means, including Domo’s website, press releases, SEC filings, blogs and social media, in order to achieve broad, non-exclusionary distribution of information to the public. We intend to use the Domo Facebook page, the Domo LinkedIn page, the Domo blog, the @Domotalk Twitter account as a means of disclosing information about the Company and its services and for complying with the disclosure obligations under Regulation FD. The information we post through these social media channels may be deemed material. Accordingly, we encourage investors and others to monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described here may be updated from time to time as listed on our investor relations webpage.

Use of Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP), we reference in this press release and the accompanying tables the following non-GAAP financial measures: billings, non-GAAP subscription gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, and adjusted free cash flow. In computing these measures, we exclude the effects of certain items including stock-based compensation expense, amortization of certain intangible assets, the reversal of contingent tax-related accruals and proceeds from shares issued in connection with employee stock purchase plan.

As it relates to adjusted free cash flow, we add back amounts equal to the proceeds from shares issued in connection with employee stock purchase plan to reflect the non-cash nature of these transactions. Because no cash is exchanged in these transactions, showing proceeds in the financing section of the statement of cash flows as required by GAAP results in a corresponding decrease in the operating section, which management believes is not indicative of actual cash used in or provided by our operations. We believe that this non-GAAP cash metric is useful because it provides investors with the same information that management uses to consistently evaluate, forecast and measure the Company’s actual cash flows and its ability to achieve and maintain positive cash flows.

We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses that may not be indicative of our ongoing core business operating results. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when analyzing historical performance and liquidity and planning, forecasting, and analyzing future periods.

For a reconciliation of these non-GAAP financial measures to GAAP measures, please see the tables captioned "Reconciliation of Non-GAAP Financial Measures" included at the end of this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding our future growth, demand for our products and services, our financial outlook for our second fiscal quarter and full fiscal year 2023, and results for future periods. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our filings with the U.S. Securities and Exchange Commission, including, without limitation, the Annual Report on Form 10-K filed with the SEC on April 1, 2021 and the Quarterly Report on Form 10-Q for the fiscal quarter ended April 30, 2022 expected to be filed with the SEC on or about June 9, 2022, as well as risks to our business related to the COVID-19 pandemic. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

Domo is a registered trademark of Domo, Inc.

Domo, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
 

Three Months Ended

April 30,

2021

 

2022

Revenue:
Subscription

$

52,112

 

$

64,575

 

Professional services and other

 

7,950

 

 

9,889

 

Total revenue

 

60,062

 

 

74,464

 

Cost of revenue:
Subscription (1)

 

9,057

 

 

10,667

 

Professional services and other (1)

 

6,101

 

 

6,994

 

Total cost of revenue

 

15,158

 

 

17,661

 

Gross profit

 

44,904

 

 

56,803

 

 
Operating expenses:
Sales and marketing (1)

 

33,454

 

 

45,587

 

Research and development (1)

 

16,186

 

 

23,191

 

General and administrative (1), (2)

 

10,218

 

 

16,660

 

Total operating expenses

 

59,858

 

 

85,438

 

Loss from operations

 

(14,954

)

 

(28,635

)

 
Other expense, net (1)

 

(3,262

)

 

(4,065

)

Loss before income taxes

 

(18,216

)

 

(32,700

)

(Benefit from) provision for income taxes

 

(112

)

 

188

 

Net loss

$

(18,104

)

$

(32,888

)

 
Net loss per share (basic and diluted)

$

(0.58

)

$

(0.99

)

Weighted-average number of shares (basic and diluted)

 

31,004

 

 

33,295

 

 
 
(1) Includes stock-based compensation expenses, as follows:
Cost of revenue:
Subscription

$

419

 

$

731

 

Professional services and other

 

334

 

 

468

 

Sales and marketing

 

3,727

 

 

8,075

 

Research and development

 

2,489

 

 

7,004

 

General and administrative

 

2,916

 

 

8,805

 

Other expense, net

 

177

 

 

181

 

Total stock-based compensation expenses

$

10,062

 

$

25,264

 

 
(2) Includes amortization of certain intangible assets, as follows:
General and administrative

$

20

 

$

20

 

Domo, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
 

January 31,

 

April 30,

2022

 

2022

Assets
Current assets:
Cash and cash equivalents

$

83,561

 

$

83,995

 

Accounts receivable, net

 

64,149

 

 

46,634

 

Contract acquisition costs

 

15,417

 

 

15,065

 

Prepaid expenses and other current assets

 

9,975

 

 

15,487

 

Total current assets

 

173,102

 

 

161,181

 

 
Property and equipment, net

 

17,584

 

 

18,241

 

Right-of-use assets

 

16,392

 

 

16,006

 

Contract acquisition costs, noncurrent

 

23,177

 

 

22,047

 

Intangible assets, net

 

2,875

 

 

2,855

 

Goodwill

 

9,478

 

 

9,478

 

Other assets

 

1,981

 

 

2,064

 

Total assets

$

244,589

 

$

231,872

 

 
Liabilities and stockholders' deficit
Current liabilities:
Accounts payable

$

4,770

 

$

12,764

 

Accrued expenses and other current liabilities

 

59,976

 

 

45,033

 

Lease liabilities

 

3,439

 

 

4,102

 

Current portion of deferred revenue

 

168,335

 

 

167,091

 

Total current liabilities

 

236,520

 

 

228,990

 

 
Lease liabilities, noncurrent

 

16,757

 

 

16,464

 

Deferred revenue, noncurrent

 

2,420

 

 

2,126

 

Other liabilities, noncurrent

 

10,882

 

 

11,157

 

Long-term debt

 

103,988

 

 

105,089

 

Total liabilities

 

370,567

 

 

363,826

 

 
Commitments and contingencies
 
Stockholders' deficit:
Common stock

 

33

 

 

33

 

Additional paid-in capital

 

1,098,084

 

 

1,125,699

 

Accumulated other comprehensive income

 

388

 

 

(315

)

Accumulated deficit

 

(1,224,483

)

 

(1,257,371

)

Total stockholders' deficit

 

(125,978

)

 

(131,954

)

Total liabilities and stockholders' deficit

$

244,589

 

$

231,872

 

Domo, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 

Three Months Ended

April 30,

2021

 

2022

Cash flows from operating activities
Net loss

$

(18,104

)

$

(32,888

)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization

 

1,028

 

 

1,607

 

Non-cash lease expense

 

943

 

 

1,198

 

Amortization of contract acquisition costs

 

3,903

 

 

4,312

 

Stock-based compensation

 

10,062

 

 

25,264

 

Other, net

 

865

 

 

920

 

Changes in operating assets and liabilities:
Accounts receivable, net

 

15,271

 

 

17,515

 

Contract acquisition costs

 

(3,612

)

 

(3,203

)

Prepaid expenses and other assets

 

2,511

 

 

(5,803

)

Accounts payable

 

3,383

 

 

8,085

 

Operating lease liabilities

 

(1,080

)

 

(502

)

Accrued and other liabilities

 

(16,079

)

 

(14,186

)

Deferred revenue

 

(1,819

)

 

(1,538

)

Net cash (used in) provided by operating activities

 

(2,728

)

 

781

 

 
Cash flows from investing activities
Purchases of property and equipment

 

(1,778

)

 

(1,937

)

Net cash used in investing activities

 

(1,778

)

 

(1,937

)

 
Cash flows from financing activities
Proceeds from shares issued in connection with employee stock purchase plan

 

4,133

 

 

1,563

 

Shares repurchased for tax withholdings on vesting of restricted stock

 

(6,244

)

 

-

 

Proceeds from exercise of stock options

 

654

 

 

724

 

Net cash (used in) provided by financing activities

 

(1,457

)

 

2,287

 

Effect of exchange rate changes on cash and cash equivalents

 

(5

)

 

(697

)

Net (decrease) increase in cash and cash equivalents

 

(5,968

)

 

434

 

Cash and cash equivalents at beginning of period

 

90,794

 

 

83,561

 

Cash and cash equivalents at end of period

$

84,826

 

$

83,995

 

Domo, Inc.
Reconciliation of Non-GAAP Financial Measures
(in thousands, except per share data)
(unaudited)
 

Three Months Ended

April 30,

2021

 

2022

Reconciliation of Subscription Gross Margin on a GAAP Basis to Subscription Gross Margin on a Non-GAAP Basis:
Revenue:
Subscription

$

52,112

 

$

64,575

 

Cost of revenue:
Subscription

 

9,057

 

 

10,667

 

Subscription gross profit on a GAAP basis

 

43,055

 

 

53,908

 

Subscription gross margin on a GAAP basis

 

83

%

 

83

%

 
Stock-based compensation

 

419

 

 

731

 

Subscription gross profit on a non-GAAP basis

$

43,474

 

$

54,639

 

Subscription gross margin on a non-GAAP basis

 

83

%

 

85

%

 
Reconciliation of Total Operating Expenses on a GAAP Basis to Total Operating Expenses on a Non-GAAP Basis:
Total operating expenses on a GAAP basis

$

59,858

 

$

85,438

 

Stock-based compensation

 

(9,132

)

 

(23,884

)

Amortization of certain intangible assets

 

(20

)

 

(20

)

Total operating expenses on a non-GAAP basis

$

50,706

 

$

61,534

 

 
Reconciliation of Operating Loss on a GAAP Basis to Operating Loss on a Non-GAAP Basis:
Operating loss on a GAAP basis

$

(14,954

)

$

(28,635

)

Stock-based compensation

 

9,885

 

 

25,083

 

Amortization of certain intangible assets

 

20

 

 

20

 

Operating loss on a non-GAAP basis

$

(5,049

)

$

(3,532

)

 
Reconciliation of Operating Margin on a GAAP Basis to Operating Margin on a Non-GAAP Basis:
Operating margin on a GAAP basis

 

(25

)%

 

(38

)%

Stock-based compensation

 

17

 

 

33

 

Operating margin on a non-GAAP basis

 

(8

)%

 

(5

)%

 
Reconciliation of Net Loss on a GAAP Basis to Net Loss on a Non-GAAP Basis:
Net loss on a GAAP basis

$

(18,104

)

$

(32,888

)

Stock-based compensation

 

10,062

 

 

25,264

 

Amortization of certain intangible assets

 

20

 

 

20

 

Net loss on a non-GAAP basis

$

(8,022

)

$

(7,604

)

 
Reconciliation of Net Loss per Share on a GAAP Basis to Net Loss per Share on a Non-GAAP Basis:
Net loss per share on a GAAP basis

$

(0.58

)

$

(0.99

)

Stock-based compensation

 

0.32

 

 

0.76

 

Net loss per share on a non-GAAP basis

$

(0.26

)

$

(0.23

)

 
Billings:
Total revenue

$

60,062

 

$

74,464

 

Add:
Deferred revenue (end of period)

 

128,510

 

 

167,091

 

Deferred revenue, noncurrent (end of period)

 

1,923

 

 

2,126

 

Less:
Deferred revenue (beginning of period)

 

(129,079

)

 

(168,335

)

Deferred revenue, noncurrent (beginning of period)

 

(3,173

)

 

(2,420

)

Increase in deferred revenue (current and noncurrent)

 

(1,819

)

 

(1,538

)

Billings

$

58,243

 

$

72,926

 

 
Reconciliation of Net Cash (Used in) Provided by Operating Activities to Adjusted Free Cash Flow:
Net cash (used in) provided by operating activities

$

(2,728

)

$

781

 

Proceeds from shares issued in connection with employee stock purchase plan

 

4,133

 

 

1,563

 

Purchases of property and equipment

 

(1,778

)

 

(1,937

)

Adjusted free cash flow

$

(373

)

$

407

 

 

Contacts

Media –
Julie Kehoe
PR@domo.com

Investors –
Peter Lowry
IR@domo.com

Contacts

Media –
Julie Kehoe
PR@domo.com

Investors –
Peter Lowry
IR@domo.com