Ooma(US:OOMA)2021-03-02 03:32Financial Data and Key Metrics Changes - Ooma reported Q4 revenue of $44.3 million, exceeding guidance of $43 million to $43.8 million, with a year-over-year growth of 9% [33][34] - For the full fiscal year 2021, total revenue reached $168.9 million, an 11% increase from $151.6 million in fiscal 2020 [34] - Q4 net income was $2.8 million, surpassing guidance of $2 million to $2.6 million, while full year net income was a record $11.5 million compared to a net loss of $700,000 in fiscal 2020 [35] - Subscription and services revenue as a percentage of total revenue increased to 93% from 92% year-over-year [37] Business Line Data and Key Metrics Changes - Ooma Business subscription and services revenue grew 19% year-over-year in Q4 and 27% for the full fiscal year [36] - Residential subscription and services revenue grew 3% year-over-year for both Q4 and the full year [36] - The average revenue per user (ARPU) increased 3% sequentially and 9% year-over-year, from $11.38 to $12.46 [39] Market Data and Key Metrics Changes - Ooma's annual recurring revenue (ARR) reached $160.5 million, up from $143 million a year ago, driven by a 27% growth in subscription services revenues from business customers [13] - The net dollar subscription retention rate for Q4 was 96%, up from 95% sequentially [40] Company Strategy and Development Direction - The company aims to expand capabilities of Ooma Office to attract larger customers and plans new service enhancements for fiscal 2022 [15] - Ooma intends to grow its business with larger customers while maintaining its leadership in the small business segment [17] - The company plans to expand internationally, targeting more than a dozen new countries by the end of fiscal 2022 [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about favorable market trends, including increased spending on universal communications and collaboration services post-COVID [28][29] - The company anticipates continued growth in Ooma Business, with a projected 20% growth rate for fiscal 2022 [48] - Management highlighted the importance of customer service and product quality in driving retention and growth [96] Other Important Information - Ooma ended the fiscal year with total cash and investments of $28.3 million and no debt, reflecting a $2.2 million increase in cash for the year [46] - The company expects fiscal 2022 capital expenditures to range between $5 million and $6 million [51] Q&A Session Summary Question: Did the business guidance growth rate for the year of 20% include hardware or was it subscription only? - Management confirmed it was subscription only [59] Question: How meaningful could Microsoft Teams direct routing be for bookings? - Management sees significant opportunity in Microsoft Teams, especially with larger organizations [60][62] Question: Is there still potential to double the size of the largest customer with international efforts? - Management believes there is potential to double users by adding a dozen or more countries [64] Question: How does the company view the opportunity in Europe? - Management is focused on expanding to serve the needs of their large customer and believes they can leverage their network for scale [71] Question: What is the average number of users per customer today? - Management indicated that enterprise customers typically have tens of users, while small business customers may have single-digit users per location [81] Question: What are the plans for expanding partnerships and digital marketing? - Management plans to increase investments in sales and marketing, particularly through channel partners and digital marketing [91] Question: What is the strategy behind the recent revolving line of credit? - Management stated it was a precautionary measure and to prepare for potential M&A opportunities [98]