Financial Data and Key Metrics Changes - In Q3, the company generated positive adjusted free cash flow of $2.1 million, a $15.8 million improvement year-over-year, and is on track to achieve positive adjusted free cash flow for the full year for the first time in company history [4][20] - The operating margin for Q3 was 6.8%, exceeding guidance and positioning the company for its highest full-year operating margin ever [4][21] - Positive EPS was reported for the second consecutive quarter, marking only the second time in company history [4][22] - Total revenue reached $79.4 million, near the high end of guidance, with a gross margin of 75.4%, down 90 basis points year-over-year [25] Business Line Data and Key Metrics Changes - The company has transitioned to a consumption model, with 80% of annual recurring revenue (ARR) now on consumption contracts, a significant increase from single digits two years ago [8][9] - Monthly active users across the customer base increased over 10% year-over-year, reflecting growing momentum in user engagement [9][10] - Current subscription RPO grew 3% year-over-year to $214.1 million, while total subscription RPO grew 15% to $405.9 million, indicating strong customer relationships [23] Market Data and Key Metrics Changes - Leads from strategic partners increased over 25% compared to Q2 and more than doubled from Q1, demonstrating rapid expansion of partner relationships [7] - The company expects billings for Q4 to be between $107.5 million and $109.5 million, representing a 6% year-over-year growth, which would be the highest billings growth in over three years [26] Company Strategy and Development Direction - The company is focused on deepening its partner ecosystem, accelerating consumption, and leveraging AI capabilities [4][18] - A composable approach to selling platform components is being embraced, allowing customers to engage with the platform in a modular fashion [10] - The company is seeing strong adoption of AI features, with unique accounts using AI increasing over 60% year-over-year [11][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline for Q4, despite longer sales cycles for partner-related deals, emphasizing the strength of relationships built with CIO-level engagement [32][70] - The company anticipates continued improvement in gross retention rates, projecting an increase to approximately 87% in Q4, with potential to approach 90% in future quarters [24][80] - Management highlighted the importance of governance in AI usage, ensuring customers can leverage AI while maintaining control over their data [57] Other Important Information - The company received multiple industry recognitions for its leadership in AI and data products, including being named a leader in agentic AI and receiving awards for best business intelligence technology [17] - The CEO publicly addressed personal challenges related to alcohol use and emphasized a commitment to recovery while maintaining responsibilities as CEO [84][85] Q&A Session Summary Question: What caused the negative billing surprise in Q3? - Management indicated that the longer sales cycles associated with the ecosystem business contributed to the billing shortfall, but expressed confidence in the pipeline for Q4 [30][32] Question: How are things looking for Q4? - Management reported that Q4 started well, with some deals that had slipped already closing, and expressed optimism about the pipeline [33][34] Question: Can you elaborate on opportunities with CDWs? - Management noted that partners are considering OEM deals, indicating strong interest in deeper collaborations [36][39] Question: What is the outlook for net revenue retention? - Management expects improvements in net revenue retention as gross retention increases and as the company capitalizes on the consumption model [40][41] Question: How is the conversation around AI evolving? - Management emphasized a proactive approach to AI, focusing on improving customer delivery and developing an agentic platform [53][54]

Financial Data and Key Metrics Changes - In Q3, the company generated positive adjusted free cash flow of $2.1 million, a $15.8 million improvement year-over-year, and is on track to finish the year with positive adjusted free cash flow for the first time ever [4][19] - The operating margin was 6.8%, exceeding guidance and positioning the company for its highest full-year operating margin ever [4][20] - Positive EPS was reported for the second consecutive quarter, marking the second time in company history [4][20] - Total revenue reached $79.4 million, near the high end of guidance, with a gross margin of 75.4%, down 90 basis points year-over-year [23] Business Line Data and Key Metrics Changes - The company has transitioned to a consumption model, with 80% of annual recurring revenue (ARR) now on consumption contracts, a significant increase from single digits two years ago [8][9] - Monthly active users across the customer base increased over 10% year-over-year, reflecting growing engagement and adoption [9][10] - Current subscription RPO grew 3% year-over-year to $214.1 million, while total subscription RPO grew 15% to $405.9 million [21] Market Data and Key Metrics Changes - Leads from strategic partners increased over 25% compared to Q2 and more than doubled from Q1, indicating rapid expansion of partner relationships [7] - The company expects billings of $107.5-$109.5 million in Q4, representing 6% year-over-year growth, which would be the highest billings growth in over three years [24] Company Strategy and Development Direction - The company is focused on deepening its partner ecosystem, accelerating consumption, and leveraging AI capabilities [4][12] - A composable approach to selling platform components is being embraced, allowing customers to engage with Domo in a way that meets their immediate needs [10] - The company is seeing strong adoption of AI features, with unique accounts using AI increasing over 60% year-over-year [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term model's durability, citing strong adoption trends as leading indicators of future financial performance [12] - The company anticipates that the work done over the past few years is paying off, positioning it for meaningful, profitable growth in the future [18] - Management acknowledged the challenges of longer sales cycles due to the complexity of partner-related deals but emphasized the strength of relationships built through CIO-level engagement [20][27] Other Important Information - The company received strong industry recognition, being named a leader in various categories related to AI and data products [17] - Management highlighted the importance of governance in AI usage, ensuring customers can leverage AI while maintaining control over their data [47] Q&A Session Summary Question: What caused the negative billing surprise in Q3? - Management noted that the ecosystem business has grown larger, leading to longer sales cycles for complex deals involving multiple stakeholders, particularly CIOs [27][30] Question: How is the company addressing the longer sales cycles? - Management indicated that while the sales cycles are longer, they result in stronger, more durable customer relationships, which ultimately benefits the company [20][27] Question: What is the outlook for net revenue retention? - Management expects improvements in net revenue retention as gross retention increases and as the company better realizes the potential of the consumption model [35][56] Question: How is the company leveraging learnings from the Snowflake partnership? - The company is applying insights gained from the Snowflake partnership to build stronger relationships with new partners, enhancing both technology integration and go-to-market strategies [48] Question: What are the expectations for future investments? - Management indicated that while there are areas for potential investment, they are also focused on maintaining efficiency and leveraging AI to enhance operations [54][55]

Financial Performance - Total revenue for Q3 FY2026 was $79.4 million, with subscription revenue accounting for $71.9 million[5] - Billings reached $73.2 million, marking a significant growth in the company's billing performance[5] - Subscription Remaining Performance Obligations (RPO) increased by 15% year over year to $405.9 million as of October 31, 2025[5] - Net cash provided by operating activities was $3.4 million, reflecting a 125% increase year over year[5] - Adjusted free cash flow improved to $2.1 million, an increase of 115% year over year[5] - GAAP net loss for the quarter was $10.4 million, with a net loss per share of $0.25 based on 41.4 million weighted-average shares[5] - Non-GAAP net income was reported at $0.3 million, translating to a diluted non-GAAP net income per share of $0.01[5] - The company expects Q4 FY2026 revenue to be in the range of $78.0 million to $79.0 million[9] - Full year FY2026 revenue guidance is projected between $317.5 million and $318.5 million[9] Cash Flow and Liquidity - Domo's ecosystem strategy is anticipated to yield free cash flow positivity for the year and each quarter within the year[3] - Cash and cash equivalents at the end of the period increased to $47,874 thousand as of October 31, 2025, compared to $40,925 thousand at the end of the previous quarter, reflecting an increase of approximately 16.5%[23] - Adjusted free cash flow for the three months ended October 31, 2024, was $(13.773) million, compared to $2.074 million in 2025[27] - Net cash used in operating activities for the three months ended October 31, 2024, was $(13.701) million, while it was $3.384 million in 2025[27] Revenue and Profitability Metrics - Subscription revenue for the three months ended October 31, 2025, was $71,879 thousand, a slight increase from $71,113 thousand in the same period of 2024, reflecting a growth of 1.1%[25] - The net loss for the three months ended October 31, 2025, was $10,388 thousand, compared to a net loss of $18,761 thousand for the same period in 2024, indicating a reduction in losses by approximately 44.5%[23] - Subscription gross margin on a GAAP basis was 80% for the three months ended October 31, 2025, down from 81% in the same period of 2024[25] - The company reported a subscription gross profit on a non-GAAP basis of $58,408 thousand for the three months ended October 31, 2025, compared to $58,563 thousand in the same period of 2024[25] Deferred Revenue and Liabilities - Deferred revenue increased to $178,276 thousand as of October 31, 2025, up from $146,269 thousand, indicating a growth of approximately 21.9%[21] - The total liabilities decreased slightly to $391,586 thousand as of January 31, 2025, from $393,537 thousand on October 31, 2025[21] - The company’s accumulated deficit improved to $(1,487,538) thousand as of January 31, 2025, compared to $(1,538,910) thousand on October 31, 2025, showing a reduction in the deficit by approximately 3.3%[21] Shareholder Metrics - Net loss per share on a GAAP basis (basic) for the three months ended October 31, 2024, was $(0.48), compared to $(0.25) for the same period in 2025[27] - Weighted-average shares used (basic) for the three months ended October 31, 2024, were 38,832, compared to 41,448 in 2025[27] - Stock-based compensation for the three months ended October 31, 2024, was $0.34 per share, compared to $0.30 per share in 2025[27] Comparisons with Previous Periods - Total revenue for the three months ended October 31, 2024, was $79.764 million, slightly up from $79.403 million in 2025[27] - Billings for the three months ended October 31, 2024, were $73.396 million, compared to $73.203 million in 2025[27] - Deferred revenue at the end of the period for October 31, 2024, was $153.919 million, compared to $146.269 million in 2025[27] - Loss on extinguishment of debt contributed $0.05 to the net loss per share on a non-GAAP basis for the three months ended October 31, 2024[27] - Remeasurement of warrant liability resulted in a $0.01 adjustment for the three months ended October 31, 2024, compared to a $(0.04) adjustment in 2025[27]

Core Insights - Domo's AI and Data Products Platform has been recognized as a winner in the 2025 Products of the Year Awards by CRN® for best technology in the Business Intelligence and Data Analytics category [1] - This recognition highlights Domo's platform's effectiveness in helping customers reduce manual work, accelerate decision-making, and enhance performance across critical business areas [1] Company Overview - Domo is positioned as a leader in the Business Intelligence and Data Analytics sector, showcasing its commitment to innovation and customer support through its award-winning platform [1] - The platform's capabilities are designed to streamline operations and improve overall business efficiency, making it a valuable tool for organizations looking to optimize their data management processes [1]

Core Insights - Domo, Inc. is identified as a notable small-cap company within the analytics and data-platform sector, with its headquarters located in Utah [1] Company Overview - Domo, Inc. operates in the analytics and data-platform space, which is a growing industry with increasing demand for data-driven decision-making [1]

Core Insights - Domo has partnered with Formula 1 driver Alex Albon to demonstrate the impact of data on performance in racing and business [2][4][6] - The collaboration will run through the 2026 season and includes various initiatives aimed at enhancing fan engagement and showcasing data-driven decision-making [2][4][5] Company Overview - Domo is an AI and Data Products platform that enables businesses to leverage data and AI for value creation [7] - The platform supports users in preparing, visualizing, automating, and distributing data products, enhancing the overall data journey [7] Partnership Details - The partnership will feature exclusive content, interactive experiences, and VIP hospitality opportunities at select Formula 1 races [5][6] - Domo and Albon aim to highlight the intersection of human instinct and data-driven intelligence in achieving measurable results [3][4] Industry Context - The collaboration emphasizes the importance of data in modern racing, where every decision is informed by billions of data points, paralleling the best practices in business [4][6] - The initiative aims to redefine fan engagement in Formula 1 by turning insights into impactful experiences [7]

Core Insights - Domo has partnered with Formula 1 driver Alex Albon to demonstrate the impact of data on performance in both racing and business contexts [2][4][6] - The collaboration will run through the 2026 season and includes various initiatives aimed at enhancing fan engagement and showcasing data-driven decision-making [2][4][5] Partnership Details - The partnership will feature behind-the-scenes storytelling, data-driven fan experiences, and integrations that highlight the synergy between data insights and human instinct [2][3][4] - Key initiatives include exclusive content, interactive experiences at Domo's Domopalooza 2026 event, VIP hospitality opportunities at select races, and digital integrations across Albon's channels [5][6] Company Background - Domo is an AI and Data Products platform that enables businesses to leverage data and AI for improved decision-making and performance [7] - The platform supports users in preparing, visualizing, automating, and distributing data products, ultimately driving measurable value for businesses [7]

Core Insights - Domo has launched its services in the AWS Asia-Pacific Region, enhancing performance and reducing latency for India-based customers and global clients operating in India [1][2][3] Company Expansion - The new AWS Asia-Pacific Region allows Domo to run workloads and securely store content in India, ensuring lower latency for end users [3] - This expansion is part of Domo's global infrastructure strategy, reflecting its commitment to the rapidly growing Indian market and the broader APAC region [2][4] Customer Benefits - Domo's investment in India aims to help organizations leverage their data effectively while ensuring compliance with local security and privacy regulations [4] - The introduction of Domo Free Trial instances facilitates easier access for Indian businesses to experience the platform's benefits [4] Technology and Infrastructure - AWS Regions consist of Availability Zones that provide independent power, cooling, and security, connected through ultra-low-latency networks, supporting business continuity and high availability [3] - Domo's platform enables users to prepare, visualize, automate, and build end-to-end data products, enhancing the overall data journey for businesses [5]

Core Insights - Domo has been recognized as a Business Intelligence (BI) One to Watch in Snowflake's annual report, highlighting its capabilities in AI-driven solutions for data visibility and actionability [1][5] Group 1: Recognition and Collaboration - The fourth annual edition of Snowflake's Modern Marketing Data Stack report identifies technologies and platforms adopted by over 11,100 customers, focusing on the impact of AI, privacy, and data gravity on Martech and Adtech [2] - Domo's AI and data products platform is noted for delivering real-time insights into campaign performance, customer behavior, and marketing ROI, enhancing business performance through the Snowflake AI Data Cloud [3][4] - Domo's recognition reflects its deep collaboration with Snowflake, enabling seamless data integration, transformation, and analysis while maintaining governance and scalability [4] Group 2: Market Position and Future Outlook - Domo's growth in partnership with Snowflake positions it as a key technology in the Business Intelligence space, addressing the evolving needs of marketers [5] - The report categorizes various AI Data Cloud Product Partners, highlighting their solutions as "leaders" or "ones to watch," and illustrates how Snowflake customers utilize these technologies for data-driven marketing strategies [4]

Core Viewpoint - Domo's stock has significantly outperformed the market, with a 150.7% increase year-to-date, surpassing both the Zacks Computer and Technology sector and the Zacks Internet - Software industry [1] Performance Metrics - Domo's stock has risen 31.1% over the past month and reached a new 52-week high of $17.9 [1] - The company has consistently beaten earnings estimates, reporting an EPS of $0.02 against a consensus estimate of -$0.05 in its last earnings report [2] Valuation Metrics - Domo's current valuation metrics are crucial for assessing potential future performance, especially after reaching a 52-week high [3] - The Zacks Style Scores indicate Domo has a Value Score of F, while its Growth and Momentum Scores are A and B, respectively, resulting in a VGM Score of B [5] Zacks Rank - Domo holds a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts, suggesting potential for further stock price appreciation [6] Competitive Landscape - Domo remains a strong choice within its industry, with NCR Atleos Corporation (NATL) also showing promise, holding a Zacks Rank of 1 (Strong Buy) and a Value Score of A [7] - NCR Atleos Corporation reported a 9.41% earnings beat and is projected to earn $3.98 per share on revenue of $4.36 billion for the current fiscal year [8] Industry Context - The Internet - Software industry is performing well, ranking in the top 26% of all industries, providing favorable conditions for both Domo and NCR Atleos Corporation [9]