Yext(US:YEXT)2023-12-05 21:13Financial Performance - Total revenue for the three months ended October 31, 2023, was $101,164,000, representing a 1.9% increase from $99,280,000 in the same period of 2022[20] - Gross profit for the three months ended October 31, 2023, was $79,098,000, up from $73,617,000 in the prior year, indicating a gross margin improvement[20] - Net loss for the three months ended October 31, 2023, was $468,000, significantly reduced from a net loss of $12,310,000 in the same quarter of 2022[20] - Total revenue for the three months ended October 31, 2023, was $101.2 million, a 1.8% increase from $99.3 million in the same period of 2022[39] - Total revenue for the nine months ended October 31, 2023, was $303.2 million, a 1% increase from $299.0 million in the same period of 2022, driven by new customer subscriptions[134] - Gross profit for the nine months ended October 31, 2023, was $237.4 million, reflecting a gross margin of 78.3%, up from 74.1% in the same period of 2022[138] - The net loss for the three months ended October 31, 2023, was $468,000, a significant improvement from a net loss of $12.3 million in the same period of 2022[125] - Non-GAAP net income for the nine months ended October 31, 2023, was $30.0 million, compared to a non-GAAP net loss of $9.2 million in the same period of 2022[149] Cash and Liquidity - Cash and cash equivalents as of October 31, 2023, were $182,156,000, down from $190,214,000 at the beginning of the fiscal year[17] - The company reported net cash provided by operating activities of $18,137,000 for the nine months ended October 31, 2023, compared to a net cash used of $18,092,000 in the prior year[27] - As of October 31, 2023, the company had cash and cash equivalents of $182.2 million, sufficient to meet projected operating requirements for at least the next 12 months[152] - The company may seek additional equity or debt financing in the future to support capital requirements and potential acquisitions[154] - The company has maintained compliance with all debt covenants as of October 31, 2023[161] Assets and Liabilities - Total assets decreased to $431,640,000 as of October 31, 2023, from $523,761,000 as of January 31, 2023[17] - Total liabilities decreased to $295,294,000 as of October 31, 2023, from $395,738,000 as of January 31, 2023[17] - Stockholders' equity increased to $136,346,000 as of October 31, 2023, from $128,023,000 as of January 31, 2023[17] - The company’s accumulated deficit increased to $680,859,000 as of October 31, 2023, from $676,542,000 as of January 31, 2023[17] Revenue Sources - Revenue from North America for the nine months ended October 31, 2023, was $239.3 million, representing 79% of total revenue, while international revenue was $63.9 million[40] - Revenue from Direct Customers was $82.3 million for the three months ended October 31, 2023, a 4% increase from $78.9 million in 2022, while revenue from Third-Party Reseller Customers decreased by 7% to $18.9 million[128] - Professional services revenue accounted for approximately 8% of total revenue for the nine months ended October 31, 2023[38] - The company had no single customer accounting for more than 10% of total revenue for the three and nine months ended October 31, 2023[36] Operating Expenses - Operating expenses for the three months ended October 31, 2023, were $80,879,000, down from $85,749,000 in the same period of 2022[20] - Cost of revenue decreased to $22.1 million for the three months ended October 31, 2023, down 14% from $25.7 million in 2022, primarily due to lower employee-related costs[129] - Sales and marketing expenses decreased by 8% to $45.4 million for the three months ended October 31, 2023, compared to $49.4 million in the same period of 2022[131] - General and administrative expense decreased by 8% to $17.2 million for the three months ended October 31, 2023, down from $18.7 million in the same period of 2022[133] - Research and development expense was $18.3 million for the three months ended October 31, 2023, an increase of 4% from $17.6 million in the same period of 2022[132] Stock-Based Compensation - The total stock-based compensation expense for the nine months ended October 31, 2023, was $34.335 million, a decrease from $48.990 million in the same period of 2022[72] - The aggregate intrinsic value of options vested and expected to vest and exercisable is $1.282 million as of October 31, 2023[60] - The company’s stock-based compensation for the nine months ended October 31, 2023, was $34.576 million, compared to $49.376 million for the same period in 2022[75] - The total unrecognized compensation cost related to the Employee Stock Purchase Plan (ESPP) as of October 31, 2023, was $0.8 million, expected to be amortized over 0.37 years[68] Customer Metrics - As of October 31, 2023, the company had approximately 2,980 customers, reflecting its ability to grow its enterprise and mid-size customer base[111] - Total Annual Recurring Revenue (ARR) increased to $396.8 million for the year ended October 31, 2023, up 2% from $389.5 million in 2022[116] - Direct Customers ARR rose to $326.6 million, a 3% increase from $317.3 million in the previous year, while Third-Party Reseller Customers ARR decreased by 3% to $70.2 million[116] - The dollar-based net retention rate for Direct Customers improved to 97% in 2023 from 96% in 2022, while Third-Party Reseller Customers increased significantly from 89% to 95%[118] Challenges and Risks - The company has faced significant leadership changes, including the resignation of key executives in 2022 and 2023[200] - The company has experienced challenges in recruiting and retaining a sufficient sales force, which is critical for revenue growth[205] - Adverse economic conditions, including inflation and reduced technology spending, may negatively impact business performance[195] - The company is exposed to foreign currency exchange rate risks that could negatively impact revenue and increase expenses for international operations[209] - The company may face challenges in renegotiating agreements with third-party application providers, which could lead to loss of access to critical resources and negatively affect customer subscriptions[213] - Future profitability is uncertain, with the need to generate increased revenue and reduce expenses to achieve profitability[194]