Upland Software(US:UPLD)2025-05-12 13:14Revenue Performance - Upland Software's revenue grew from $149.9 million in 2018 to $274.8 million in 2024, representing a compound annual growth rate of 11%[120]. - For the three-month period ended March 31, 2025, total revenue was $63.655 million, a decrease from $70.736 million in the same period of 2024[129]. - Total revenue for the three months ended March 31, 2025, was $63.7 million, a decrease of 10% from $70.7 million in the same period of 2024[139]. - Upland's subscription and support revenue from Sunset Assets was $4.481 million for the three-month period ended March 31, 2025[129]. - Subscription and support revenue decreased by $6.4 million, primarily due to a decline of $2.5 million from Sunset Assets and $3.9 million from divested businesses[139]. Profitability and Expenses - Adjusted EBITDA for the three-month period ended March 31, 2025, was $13.082 million, compared to $13.103 million in the same period of 2024[132]. - Total cost of revenue was $18.0 million, down 14% from $21.0 million in the prior year, resulting in a gross profit of $45.6 million, which is 72% of total revenue[140]. - Operating expenses totaled $46.7 million, a significant decrease from $141.3 million in the previous year, leading to a loss from operations of $1.1 million[140]. - Sales and marketing expenses decreased by 19% to $13.8 million, representing 22% of total revenue[144]. - Research and development expenses were $11.5 million, a decrease of 7% from $12.5 million, maintaining 18% of total revenue[146]. - General and administrative expenses decreased by 12% to $11.6 million, accounting for 18% of total revenue[148]. - Depreciation and amortization expenses were $8.0 million, down 30% from $11.4 million, primarily due to the decline in amortization from intangible assets associated with divested product lines[150]. - Divestiture-related expenses amounted to $1.7 million, representing 2% of total revenue, with no such expenses recorded in the prior year[152]. - Net loss attributable to common shareholders was $27.3 million, compared to a net loss of $97.5 million in the same period last year[139]. - The company reported a net loss of $25.848 million for the three-month period ended March 31, 2025, compared to a net loss of $96.130 million in the same period of 2024[132]. Cash Flow and Financial Position - Cash provided by operating activities was $8.3 million for the three months ended March 31, 2025, an increase of approximately $3.2 million from $5.1 million in 2024[165]. - Cash provided by investing activities was $3.8 million for the three months ended March 31, 2025, compared to cash used of $(0.2) million in 2024[168]. - Cash used in financing activities increased to $(34.7) million for the three months ended March 31, 2025, compared to $(9.6) million in 2024, primarily due to increased payments on Term Loans[170]. - As of March 31, 2025, the company had $33.7 million in cash and cash equivalents, down from $57.1 million as of December 31, 2024[160]. - The company had a working capital deficit of $17.1 million as of March 31, 2025, compared to a deficit of $2.0 million as of December 31, 2024[162]. Strategic Initiatives - Upland plans to pursue acquisitions of complementary technologies and businesses to expand its product library and market access[121]. - The company aims to incorporate AI functionality into its products to enhance customer experiences and drive measurable ROI[119]. - Upland's management emphasizes the importance of maintaining relationships with third parties and adapting to changing market conditions[122]. Foreign Operations and Currency Impact - Foreign revenue as a percentage of total revenue was 29% for the three months ended March 31, 2025, compared to 30% for the same period in 2024[120]. - The effect of a hypothetical 10% change in foreign currency exchange rates could have resulted in a change in revenue of $1.4 million for the three months ended March 31, 2025[181]. - The company incurs operating expenses in various foreign currencies, including Australian dollars, Canadian dollars, Indian Rupees, British pounds, Euros, and Israeli New Shekels[181]. - The translation adjustments of non-financial assets and liabilities of foreign subsidiaries are recorded in accumulated other comprehensive income (loss)[182]. - Foreign currency gains (losses) from intercompany loans used to fund acquisitions of foreign subsidiaries are recognized as a component of accumulated other comprehensive income (loss)[182]. Interest and Other Financial Metrics - Net interest income improved to $(2.4) million for the three months ended March 31, 2025, a 51% decrease from $(5.0) million in the same period of 2024[155]. - Total other expense increased by 419% to $(26.1) million for the three months ended March 31, 2025, compared to $(5.0) million in 2024[154]. - Benefit from income taxes increased by 146% to $0.5 million for the three months ended March 31, 2025, compared to $1.3 million in 2024[157]. - The effective cash interest rate for the three months ended March 31, 2025, was 5.9%[179]. - As of March 31, 2025, the outstanding balance of Term Loans is $259.4 million, maturing on August 6, 2026[180]. - A hypothetical change of 100 basis points in variable rate debt could have resulted in a $0.1 million increase in total interest expense for the three months ended March 31, 2025[180].