CCC Intelligent Solutions (US:CCCS)2024-04-30 21:15Revenue Performance - Total revenues for Q1 2024 were $227.237 million, an increase of 10.8% from $204.919 million in Q1 2023[61] - Software subscriptions revenue reached $218.069 million in Q1 2024, up from $196.256 million in Q1 2023, reflecting a growth of 11.1%[61] - Revenue recognized for the three months ended March 31, 2024, was $115,413 million, compared to $103,187 million for the same period in 2023, representing a growth of approximately 11.9%[80] - Total deferred revenue at the end of the period was $47,560 million, up from $41,422 million as of March 31, 2023, indicating an increase of about 14.4%[80] - Revenue for the three months ended March 31, 2024, increased by $22.3 million to $227.2 million, representing a growth of 10.9% compared to the same period in 2023[143] - Software subscription revenues accounted for $218.1 million, or 96% of total revenue during the three months ended March 31, 2024[143] - Revenue from the United States for the three months ended March 31, 2024, was $225,566,000, compared to $203,027,000 in 2023, indicating a growth of about 11.1%[149] - Revenue from China for the three months ended March 31, 2024, was $1,671,000, down from $1,892,000 in 2023, reflecting a decline of approximately 11.7%[149] Financial Position - Accounts receivable as of March 31, 2024, was $102.007 million, slightly down from $102.365 million as of December 31, 2023[62] - Deferred revenues increased to $45.254 million as of March 31, 2024, compared to $43.567 million at the end of 2023, indicating a growth of 3.9%[62] - The expected term for financial instruments decreased to 2.3 years as of March 31, 2024, from 2.6 years at the end of 2023[64] - The risk-free interest rate increased to 4.53% as of March 31, 2024, compared to 4.10% at the end of 2023[64] - The company experienced a decrease in cash and cash equivalents, ending the period at $191.188 million, down from $338.354 million at the end of the same period in 2023[75] - Accounts receivable as of March 31, 2024, was $106,799 million, slightly down from $107,939 million as of December 31, 2023[86] Profitability and Loss - For the three months ended March 31, 2024, the Company reported a net loss of $597,000 compared to a net income of $2.184 million for the same period in 2023[75] - The net loss attributable to common stockholders for Q1 2024 was $(1.739) million, compared to a net income of $2.184 million in Q1 2023[97] - The company reported a comprehensive loss of $(1.814) million for Q1 2024, down from a comprehensive income of $2.218 million in Q1 2023[97] - The company recognized an income tax benefit of $4.2 million for the three months ended March 31, 2024, compared to $0.8 million for the same period in 2023, reflecting a significant increase in tax benefits[85] - The company made income tax payments of $576 thousand for the three months ended March 31, 2024, compared to $224 thousand for the same period in 2023[85] Operating Expenses - Total operating expenses increased to $160.065 million in Q1 2024 from $134.458 million in Q1 2023, primarily due to higher research and development costs[97] - Cost of revenues increased by $2.2 million to $59.4 million, or 3.9%, for the three months ended March 31, 2024[145] - Cost of revenues, exclusive of amortization of acquired technologies, increased by $2.4 million to $52.8 million, or 4.7%[145] - Amortization of acquired technologies was $6.6 million for the three months ended March 31, 2024[146] - The amortization of intangible assets for the three months ended March 31, 2024, was $24.509 million, slightly down from $24.751 million in the same period of 2023[75] Goodwill and Intangible Assets - The Company recorded a goodwill impairment charge of $77.4 million due to adverse impacts from market conditions and increased interest rates affecting its China reporting unit[70] - The total accumulated impairment loss for goodwill as of March 31, 2024, was $676.403 million[71] - The accumulated impairment loss as of December 31, 2023, was $77.4 million, with no changes in the carrying amount of goodwill during the three months ended March 31, 2024[91] - As of March 31, 2024, the net carrying amount of total intangible assets was $990.537 million, with a gross carrying amount of $1,666.940 million and accumulated amortization of $676.403 million[71] - The total intangible assets balance as of March 31, 2024, was $1,015,046 million, with customer relationships and acquired technologies contributing significantly to this total[92] Strategic Focus and Growth Opportunities - The company is focused on expanding its SaaS platform for the property and casualty insurance economy, with operations primarily in the US and China[59] - Future growth opportunities are anticipated through the development and marketing of new technology solutions[59] - The company is investing in new solutions to digitize the entire automotive claims lifecycle and expand into adjacent insurance lines[113] - Approximately $1,533 million of revenue is expected to be recognized from remaining performance obligations, with about $617 million expected in the next twelve months[124] - Software Net Dollar Retention (NDR) was 107% as of March 31, 2024, indicating strong customer retention and expansion[139] Customer Base - The company has over 35,000 total customers, including more than 29,500 automotive collision repair facilities and 27 of the top 30 automotive insurance carriers in the U.S.[113] - The increase in revenue was driven by 8% growth from existing customer upgrades and 3% growth from new customers[144] Derivative Instruments and Fair Value - The fair value of interest rate cap agreements was estimated at $6.9 million as of March 31, 2024, compared to $6.2 million as of December 31, 2023[83] - The estimated fair value of private warrants was $53,086 million as of March 31, 2024, reflecting the company's stock price on the valuation date[83] - The company reported a change in fair value of derivative instruments resulting in a loss of $718,000 for the three months ended March 31, 2024[75] Other Financial Metrics - The Company performed a qualitative assessment for its remaining reporting unit with goodwill and determined no indicators of impairment were present as of November 30, 2023[70] - The company recognized $8.228 million in prepaid SaaS costs as of March 31, 2024, compared to $7.833 million as of December 31, 2023[114] - The company made cash payments for operating leases of $1.8 million in Q1 2024, compared to $0.9 million in Q1 2023[115] - The Company had a gross carrying amount of customer relationships valued at $1,291.830 million as of March 31, 2024[71] - Approximately 36,824,894 common stock equivalent shares were excluded from the computation of diluted per share amounts for the three months ended March 31, 2024, due to their anti-dilutive effect[148] - The Sponsor Vesting Shares, totaling 8,625,000 shares, are non-transferable and subject to forfeiture on the tenth anniversary of the Business Combination if certain triggering events do not occur[148]