Evolv Technologies (US:EVLV)2025-04-28 21:02Financial Performance - Evolv generated revenue of $74.8 million for the nine months ended September 30, 2024, compared to $59.0 million for the same period in 2023, representing a year-over-year increase of approximately 26.4%[173]. - The company reported a net loss of $38.3 million for the nine months ended September 30, 2024, significantly improved from a net loss of $90.9 million for the same period in 2023[173]. - Total revenue for the three months ended September 30, 2024, was $27.36 million, a 37% increase from $19.96 million in the same period of 2023[202]. - Total revenue for the nine months ended September 30, 2024, was $74.77 million, an increase of $15.78 million (27%) from $58.99 million in 2023[218]. - The company reported a net loss of $30.44 million for Q3 2024, a significant decline from a net income of $5.05 million in Q3 2023, representing a 703% decrease[202]. - The net loss for the nine months ended September 30, 2024, was $38.30 million, a decrease of $52.55 million (58%) from a net loss of $90.85 million in 2023[218]. Revenue Sources - Evolv's solutions are offered primarily under a multi-year subscription model, providing predictable revenue streams and enhancing customer value[163]. - Evolv's revenue is derived from multiple sources, including subscription arrangements, product sales, and professional services, with subscription revenue recognized ratably over the lease term[175][177]. - Subscription revenue increased by 82% to $17.91 million in Q3 2024, compared to $9.86 million in Q3 2023[205]. - Subscription revenue surged by $24.05 million (101%) to $47.78 million for the nine months ended September 30, 2024, compared to $23.73 million in 2023[221]. - Service revenue increased by $6.15 million (57%) to $16.90 million for the nine months ended September 30, 2024, compared to $10.75 million in 2023[222]. - License fee and other revenue increased by 48% to $5.29 million for the nine months ended September 30, 2024, compared to $3.58 million in 2023[223]. Customer Growth - The company added 52 new customers during the three months ended September 30, 2024, contributing to growth in sales[203]. - The company added 189 new customers during the nine months ended September 30, 2024, contributing to revenue growth[219]. Operating Expenses - Total operating expenses rose by 9% to $34.96 million in Q3 2024, compared to $32.08 million in Q3 2023[202]. - Research and development expenses were $5.81 million in Q3 2024, a 9% decrease from $6.39 million in Q3 2023[202]. - Sales and marketing expenses increased by $558,000 (4%) to $14.97 million for the three months ended September 30, 2024, compared to $14.41 million in 2023[210]. - General and administrative expenses rose by $2.72 million (24%) to $13.98 million for the three months ended September 30, 2024, compared to $11.26 million in 2023[211]. - Research and development expenses decreased by 1% to $18.06 million for the nine months ended September 30, 2024, primarily due to higher capitalized payroll costs[224]. - Sales and marketing expenses increased by 18% to $47.84 million for the nine months ended September 30, 2024, driven by new hires and increased stock-based compensation[225]. - General and administrative expenses rose by 28% to $39.88 million for the nine months ended September 30, 2024, largely due to increased personnel costs and one-time regulatory expenses[226]. Profitability Metrics - Gross profit for subscription revenue was $10.56 million, representing an 85% increase from $5.70 million in the prior year[205]. - The gross profit margin for subscription revenue was 59% in Q3 2024, slightly up from 58% in the prior year[205]. - The gross profit margin for subscription revenue was 60% for the nine months ended September 30, 2024, compared to 59% in 2023[221]. - Gross profit from license fee and other revenue rose by 71% to $4.81 million, with a gross profit margin of 91% for the nine months ended September 30, 2024, up from 78% in 2023[223]. Cash Flow and Financial Position - Cash, cash equivalents, and marketable securities totaled $56.0 million as of September 30, 2024, expected to fund operating expenses for at least twelve months[235]. - The company incurred cash outflows from operating activities of $34.1 million for the nine months ended September 30, 2024, compared to $6.7 million in 2023[233]. - Interest income decreased to $2.4 million for the nine months ended September 30, 2024, down from $4.6 million in 2023[229]. - Cash provided by investing activities for the nine months ended September 30, 2024, was $11.9 million, while cash used in investing activities for the same period in 2023 was $92.8 million[244][246]. - Cash provided by financing activities for the nine months ended September 30, 2024, was $1.2 million, a significant decrease from the $29.7 million used in financing activities during the same period in 2023[247][248]. - The company invested $24.4 million in property and equipment during the nine months ended September 30, 2024, primarily for Evolv Express units[244]. Market and Operational Risks - The company expects fluctuations in revenue and operating results due to factors such as rising inflation, supply chain issues, and shifts towards touchless security screening[167][168]. - The company has restated certain previously reported financial information for the fiscal year ended December 31, 2023, impacting its consolidated financial statements[158]. - There were no new accounting pronouncements that materially impacted the company's financial position or operations since the issuance of the 2023 Form 10-K[249]. - The company reported no material changes in critical accounting estimates during the nine months ended September 30, 2024[250]. - Market risks remained unchanged from the disclosures in the 2023 Form 10-K[251].