Domo(DOMO)2019-09-06 03:18Financial Data and Key Metrics Changes - The company reported a 22% year-over-year increase in revenue, reaching $41.7 million, and a 9% year-over-year increase in billings [7][24] - Subscription revenue grew by 24%, representing 84% of total revenue, with international revenue consistent at 26% of total revenue [24] - The subscription gross margin improved to 74.9%, up from 70.9% in the same quarter last year, while total gross margin increased to 66.2% [24][25] - The net loss for the quarter was $26.4 million, with a net loss per share of $0.96 [25][26] Business Line Data and Key Metrics Changes - The enterprise customer count exceeded 460, with new deal sizes in the corporate business averaging over $50,000 [20][21] - The gross renewal rate approached 90%, indicating strong customer retention [15][21] - The company added new Lighthouse customers, including luxury brands and global retailers, and signed key expansion deals with notable customers [16] Market Data and Key Metrics Changes - The international business, particularly in Asia Pacific, faced challenges, impacting overall performance [9] - The corporate business has shown resilience, with a shorter sales cycle and lower customer acquisition costs compared to the enterprise segment [20][23] Company Strategy and Development Direction - The company is refining its go-to-market strategy to focus on acquiring new customers more quickly while pursuing larger enterprise transactions [8][10] - There is an emphasis on simplifying the product message and enhancing self-service proof of concepts to increase customer engagement [11][12] - The company plans to expand partnerships with technology firms to enhance market reach and capitalize on recent acquisitions in the industry [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the pipeline and the potential for larger enterprise deals, despite longer sales cycles [10][32] - The company is committed to achieving cash flow positive status and reducing cash burn, with a focus on maintaining a fully funded business plan [20][26] - Management noted that the competitive environment has not worsened, and recent acquisitions in the market may create opportunities for growth [44][54] Other Important Information - The company is targeting a reduction in cash burn each quarter and expects to manage operating expenses effectively [28] - The dollar-based net revenue retention rate remains above 100%, with an increase in multiyear contracts among customers [23] Q&A Session Summary Question: Concerns about go-to-market strategy and focus on larger enterprise customers - Management acknowledged the need to balance efforts between larger enterprise deals and corporate business, noting that while larger deals are taking longer, they have not lost any significant deals [32][33] Question: Dynamics between renewal portfolio and new business - Management highlighted that while renewal rates are strong, new business acquisition has been slower than desired, prompting initiatives to accelerate new customer onboarding [35][36] Question: Competitive environment and impact on enterprise deals - Management indicated that recent acquisitions have caused temporary confusion but do not foresee long-term negative impacts, with opportunities arising from strengthened partnerships [44][46] Question: Strategy for multiyear deals and customer commitment - Management noted that increased multiyear contracts are driven by the strategic use of the platform and improved customer conversations, rather than solely sales incentives [55][57] Question: Marketing spending and its impact on growth - Management confirmed that while marketing expenses have been reduced, they remain focused on efficient spending and improving conversion rates through enhanced customer engagement [59][60]