Olo (OLO) - 2025 Q2 - Quarterly Results

Executive Summary & Company Overview Second Quarter 2025 Highlights Olo reported strong Q2 2025 financial performance, with revenue up 22% and ARPU up 12%, exceeding guidance Q2 2025 Financial Highlights | Metric | Q2 2025 (GAAP) | Q2 2024 (GAAP) | YoY Change | Q2 2025 (Non-GAAP) | Q2 2024 (Non-GAAP) | YoY Change | | :-------------------------------- | :------------- | :------------- | :--------- | :----------------- | :----------------- | :--------- | | Total Revenue | $85.7M | $70.5M | +22% | - | - | - | | Platform Revenue | $84.1M | $69.6M | +21% | - | - | - | | Gross Profit | $43.9M | $39.9M | +10% | $48.8M | $44.3M | +10% | | Operating Income (Loss) | ($2.7M) | $1.0M | - | $13.1M | $7.6M | +72% | | Net Income | $1.6M | $5.7M | -72% | $13.1M | $9.2M | +42% | | EPS (Diluted) | $0.01 | $0.03 | -67% | $0.07 | $0.05 | +40% | | Cash, Cash Equivalents, and Investments | $428.5M (as of Jun 30, 2025) | - | - | - | - | - | | ARPU | ~$955 | - | +12% | - | - | - | | Dollar-based NRR | 114% | - | - | - | - | - | | Ending Active Locations | ~89,000 | - | +9% | - | - | - | - Borderless, Olo's passwordless checkout feature, exceeded 19 million total accounts across more than 450 brands[6] Pending Acquisition by Thoma Bravo Olo agreed to be acquired by Thoma Bravo for $2.0 billion in equity, offering $10.25 per share, and withdrew financial guidance - Olo entered into a definitive agreement to be acquired by Thoma Bravo for approximately $2.0 billion in equity value[1][4] - Shareholders will receive $10.25 per share in cash, a 65% premium over Olo's share price of $6.20 as of April 30, 2025[4] - The transaction was unanimously approved by the Olo Board of Directors and is expected to close by the end of calendar year 2025[4] - Olo has withdrawn its prior financial guidance for fiscal year 2025 and suspended providing future guidance due to the pending acquisition[5] About Olo Olo is a leading restaurant technology provider offering ordering, payment, and guest engagement solutions to over 750 brands - Olo is a leading restaurant technology provider with ordering, payment, and guest engagement solutions[8] - The company's open SaaS platform processes millions of orders daily, serving over 750 restaurant brands and a network of more than 400 integration partners[8] Financial Performance (GAAP) Condensed Consolidated Balance Sheets As of June 30, 2025, total assets increased to $780.7 million, driven by cash, and equity grew to $709.0 million Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | As of June 30, 2025 | As of December 31, 2024 | Change | | :------------------------------------ | :------------------ | :---------------------- | :----- | | Cash and cash equivalents | $309,333 | $286,757 | +$22,576 | | Total current assets | $469,719 | $448,321 | +$21,398 | | Total assets | $780,672 | $754,776 | +$25,896 | | Total current liabilities | $60,862 | $59,594 | +$1,268 | | Total liabilities | $71,681 | $71,553 | +$128 | | Total stockholders' equity | $708,991 | $683,223 | +$25,768 | Condensed Consolidated Statements of Operations For Q2 2025, total revenue grew 22% to $85.7 million, but operating loss was $2.7 million and net income $1.6 million, a decrease due to higher G&A Condensed Consolidated Statements of Operations (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change | | :------------------------------------ | :------------------------------- | :------------------------------- | :--------- | :----------------------------- | :----------------------------- | :--------- | | Total Revenue | $85,724 | $70,504 | +21.6% | $166,404 | $137,015 | +21.4% | | Gross Profit | $43,930 | $39,905 | +10.1% | $88,244 | $77,113 | +14.4% | | Operating (Loss) Income | ($2,704) | $977 | - | ($5,120) | ($6,183) | +17.2% | | Net Income | $1,580 | $5,729 | -72.4% | $3,386 | $3,373 | +0.4% | | Diluted EPS | $0.01 | $0.03 | -66.7% | $0.02 | $0.02 | 0% | | General and administrative expenses | $16,117 | $8,664 | +86.0% | $31,907 | $21,420 | +49.0% | Condensed Consolidated Statements of Cash Flows For H1 2025, operating cash flow increased to $27.4 million, investing outflow improved to $7.7 million, and financing provided $2.9 million Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :------------------------------------ | :----------------------------- | :----------------------------- | :----- | | Net cash provided by operating activities | $27,386 | $24,158 | +$3,228 | | Net cash used in investing activities | ($7,684) | ($13,632) | +$5,948 | | Net cash provided by (used in) financing activities | $2,874 | ($19,305) | +$22,179 | | Net increase (decrease) in cash and cash equivalents | $22,576 | ($8,779) | +$31,355 | | Cash and cash equivalents, end of period | $309,333 | $269,439 | +$39,894 | Non-GAAP Metrics & Key Performance Indicators Non-GAAP Financial Measures Explanation Olo uses non-GAAP measures to provide a clearer view of core operating results, excluding non-cash and non-core charges for consistency - Non-GAAP measures are used for planning, evaluating core operating results, and assessing business strategy effectiveness, providing consistency and comparability[10] - Adjustments to GAAP measures include stock-based compensation, related payroll tax expense, certain litigation-related expenses, non-cash impairment charges, capitalized internal-use software and intangible amortization, and transaction costs associated with the Merger[13] - Free cash flow is defined as net cash from operating activities minus purchases of property and equipment and capitalization of internal-use software, used to evaluate liquidity and future growth potential[15] Key Performance Indicators Definitions Olo uses ARPU, NRR, Active Locations, GMV, and GPV to assess business health, customer growth, retention, and product demand - Average Revenue Per Unit (ARPU) is calculated by dividing total platform revenue by average active locations, indicating growth within the customer base[17] - Dollar-based Net Revenue Retention (NRR) measures the ability to retain customers and expand their use of Olo's modules over time, reflecting revenue base stability[18] - Active locations are unique restaurant locations utilizing one or more Olo modules in a quarterly period[19] - Gross Merchandise Volume (GMV) represents the gross value of orders processed through the platform, and Gross Payment Volume (GPV) is the gross volume of payments processed through Olo Pay, both used to assess product demand[20][21] Reconciliation of GAAP to Non-GAAP Results Olo provides detailed GAAP to non-GAAP reconciliations, adjusting for stock-based compensation, litigation, impairment, and transaction costs to clarify operational performance Gross Profit and Gross Margin Reconciliation Non-GAAP gross profit for Q2 2025 was $48.8 million, up from $44.3 million in Q2 2024, with non-GAAP gross margin at 57% (down from 63%) Gross Profit and Gross Margin Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total gross profit, GAAP | $43,930 | $39,905 | $88,244 | $77,113 | | Total gross profit, non-GAAP | $48,789 | $44,308 | $97,962 | $85,843 | | Total gross margin, GAAP | 51% | 57% | 53% | 56% | | Total gross margin, non-GAAP | 57% | 63% | 59% | 63% | Sales and Marketing Reconciliation Non-GAAP sales and marketing expenses for Q2 2025 were $11.1 million, down from $11.4 million, decreasing to 13% of total revenue Sales and Marketing Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Sales and marketing, GAAP | $12,903 | $13,307 | $26,735 | $27,920 | | Sales and marketing, non-GAAP | $11,072 | $11,397 | $22,951 | $24,112 | | Sales and marketing as % total revenue, GAAP | 15% | 19% | 16% | 20% | | Sales and marketing as % total revenue, non-GAAP | 13% | 16% | 14% | 18% | Research and Development Reconciliation Non-GAAP R&D expenses for Q2 2025 were $15.3 million, up from $13.7 million, remaining stable at 18% of total revenue Research and Development Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development, GAAP | $17,614 | $16,957 | $34,722 | $33,956 | | Research and development, non-GAAP | $15,332 | $13,697 | $30,234 | $27,562 | | Research and development as % total revenue, GAAP | 21% | 24% | 21% | 25% | | Research and development as % total revenue, non-GAAP | 18% | 19% | 18% | 20% | General and Administrative Reconciliation Non-GAAP G&A expenses for Q2 2025 were $9.3 million, down from $11.6 million, due to excluding litigation and impairment, decreasing to 11% of total revenue General and Administrative Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | General and administrative, GAAP | $16,117 | $8,664 | $31,907 | $21,420 | | General and administrative, non-GAAP | $9,295 | $11,600 | $20,160 | $20,938 | | General and administrative as % total revenue, GAAP | 19% | 12% | 19% | 16% | | General and administrative as % total revenue, non-GAAP | 11% | 16% | 12% | 15% | Operating Income (Loss) Reconciliation Non-GAAP operating income for Q2 2025 significantly increased to $13.1 million from $7.6 million, improving non-GAAP operating margin to 15% from 11% Operating Income (Loss) Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Operating (loss) income, GAAP | ($2,704) | $977 | ($5,120) | ($6,183) | | Operating income, non-GAAP | $13,090 | $7,614 | $24,617 | $13,231 | | Operating margin, GAAP | (3)% | 1% | (3)% | (5)% | | Operating margin, non-GAAP | 15% | 11% | 15% | 10% | Net Income (Loss) Reconciliation Non-GAAP net income for Q2 2025 rose to $13.1 million from $9.2 million, with diluted EPS increasing to $0.07 from $0.05 Net Income (Loss) Reconciliation (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income, GAAP | $1,580 | $5,729 | $3,386 | $3,373 | | Net income, non-GAAP | $13,074 | $9,159 | $24,898 | $16,981 | | Fully diluted net income per share, GAAP | $0.01 | $0.03 | $0.02 | $0.02 | | Fully diluted net income per share, non-GAAP | $0.07 | $0.05 | $0.14 | $0.10 | Non-GAAP Free Cash Flow Non-GAAP free cash flow for H1 2025 increased to $22.1 million from $17.0 million, driven by higher operating cash and reduced capitalized software Non-GAAP Free Cash Flow (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $26,838 | $18,131 | $27,386 | $24,158 | | Purchase of property and equipment | ($309) | ($299) | ($402) | ($367) | | Capitalized internal-use software | ($2,499) | ($3,682) | ($4,855) | ($6,831) | | Non-GAAP free cash flow | $24,030 | $14,150 | $22,129 | $16,960 | Corporate & Legal Information Available Information Olo disseminates material information via SEC filings, press releases, webcasts, its investor relations website, and X account for broad distribution - Olo uses SEC filings, press releases, public conference calls, webcasts, its investor relations website, and its X account (@Olo) to distribute material information[7] - This multi-channel approach ensures broad, non-exclusionary distribution of information and compliance with Regulation FD[7] Forward-Looking Statements This report contains forward-looking statements regarding Olo's future performance and the pending merger, subject to various risks and uncertainties - Statements in the press release are forward-looking, covering future performance, growth, market opportunities, business strategy, and the consummation of the pending Merger[22][23] - These statements are subject to risks and uncertainties, including the timely completion of the merger, failure to satisfy conditions, regulatory approvals, shareholder approval, potential litigation, and macroeconomic conditions[24] - Actual results could differ materially from predictions, and undue reliance should not be placed on these forward-looking statements[24][25] Additional Information Regarding the Merger Olo filed a preliminary proxy statement with the SEC for the proposed acquisition, urging investors to review these documents for important merger information - Olo filed a preliminary proxy statement with the SEC on July 28, 2025, and will file a definitive proxy statement on Schedule 14A regarding the pending merger[26] - Investors are urged to carefully read the proxy statement and other relevant documents for important information about the merger[26] - Documents can be obtained free of charge from the SEC's website (www.sec.gov) or Olo's investor relations website (investors.olo.com)[27] Participants in the Solicitation Olo's directors and executive officers may be deemed participants in the proxy solicitation for the merger, with their interests detailed in proxy statements - The Company and certain directors and executive officers may be deemed participants in the solicitation of proxies for the pending Merger[28] - Information on their interests is available in the Company's 2025 annual meeting proxy statement and will be in the special meeting proxy statement for the Merger[28]