Docebo(US:DCBO)2022-05-12 17:00Financial Data and Key Metrics Changes - Total revenue for Q1 2022 grew to $32.1 million, an increase of 47% year-over-year [16] - Subscription revenues were $29.1 million, representing 91% of total revenue for the quarter [16] - Net new ARR added during the quarter was $11.6 million, bringing total ARR to $129.3 million, a 55% year-over-year increase [16] - Gross profit margin for the quarter was 80%, compared to 82% for the prior year period [18] - Net loss for Q1 2022 was $7 million, compared to a net loss of $5.6 million for the prior year period [20] Business Line Data and Key Metrics Changes - The average contract value (ACV) increased to approximately $44,000, up 23% from $36,000 at the end of Q1 2021 [17] - ACV for new customers in the quarter was approximately $60,000, driven by a shift towards enterprise-sized deals [17] - 83% year-over-year increase in the number of customers generating ARR of more than $100,000 [7] Market Data and Key Metrics Changes - Total customers at the end of Q1 2022 were 2,947 [17] - The company continues to see strong demand across various industry verticals, particularly in the enterprise segment [6][8] Company Strategy and Development Direction - The company aims to innovate both core products and new offerings, focusing on expanding into new verticals and geographies [26] - The strategy includes investing in technologies to drive critical business outcomes and addressing skill gaps in the workforce [8] - The company is focused on transforming customer relationships into long-term partnerships to drive growth [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustained demand for enterprise learning solutions despite macroeconomic challenges [22] - The company is well-positioned to capitalize on long-term growth opportunities in the learning technology sector [15] - Management highlighted the importance of investing in human capital to support future growth [30] Other Important Information - The company is finalizing its first year-to-year report, which will be published before the shareholder meeting in June [14] - The company has a strong balance sheet with net cash and cash equivalents of $212 million at the end of the quarter [21] Q&A Session Summary Question: What would it take to reach $1 billion in revenue? - Management indicated that reaching $1 billion would require organic growth through product innovation, geographic expansion, and targeting new verticals [25][27] Question: Changes to the go-to-market strategy with new leadership? - Management emphasized the importance of leveraging new leadership to enhance organizational innovation and scale [30] Question: Insights on the demand environment and spending trends? - Management noted that companies are increasingly focused on talent retention and are investing in learning technologies to mitigate challenges [34] Question: Divergence in growth rates of ARR and revenue? - Management explained that the timing of enterprise deals and contract negotiations can lead to differences in ARR and revenue recognition [42] Question: Thoughts on the EdCast acquisition by Cornerstone? - Management stated that the acquisition does not significantly impact their business, as they believe their platform capabilities are superior [45] Question: Expectations for EBITDA positivity? - Management confirmed expectations for EBITDA to turn positive by Q4 2022, considering wage inflation and cost pressures [48] Question: Changes in customer acquisition strategies as the company moves to enterprise? - Management highlighted a shift towards more sophisticated lead generation strategies for enterprise customers, including account-based marketing [52] Question: Trends in displacements versus new business wins? - Management reported that over 80% of wins in the mid-market and enterprise segments are displacements, indicating a strong competitive position [59] Question: Competitive dynamics with potential SAP Litmos sale? - Management expressed that the sale of Litmos to a private equity firm could provide an opportunity for them to strengthen their market position [64]