Bridgeline Digital(BLIN) - 2024 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was $3.8 million, a decrease from $4.1 million in the prior year period [22] - Subscription license revenue was $3 million, down from $3.3 million year-over-year, accounting for 79% of total revenue [22][23] - Services revenue decreased to $794,000 from $821,000, representing 21% of total revenue [23] - Gross profit was $2.5 million, down from $2.8 million, with a gross profit margin of 66% compared to 69% in the prior year [24] - Net loss for the quarter was $602,000, compared to a net loss of $511,000 in the prior year [26] Business Line Data and Key Metrics Changes - HawkSearch is approaching 60% of subscription revenue, with expectations for further growth [33][38] - The company sold nearly 50 licenses this fiscal year, generating over $4 million in total contract value [38] - HawkSearch's Smart Search technology is a primary focus, driving growth and innovation [5][21] Market Data and Key Metrics Changes - The partnership with BigCommerce has significantly improved lead generation and credibility within its ecosystem [1][41] - The pipeline has seen a 35% increase in traffic and a 66% increase in conversion to lead generation compared to last year [16] Company Strategy and Development Direction - The company is focusing on expanding HawkSearch with AI capabilities and partnerships with key platforms like BigCommerce and Optimizely [6][40] - Bridgeline's e-commerce 360 strategy allows for growth through acquisitions while maintaining a strong focus on HawkSearch [5] Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about ongoing growth prospects and the strong sales trajectory of HawkSearch [14][35] - The company anticipates that subscription revenue will be dominated by HawkSearch in FY 2024, which begins in October [33] Other Important Information - The company has a cash position of $1.3 million and total assets of $16.3 million as of March 31, 2024 [27][28] - The total debt outstanding is approximately $600,000, with no other debt or earnouts remaining from previous acquisitions [27][28] Q&A Session Summary Question: When will revenue from HawkSearch begin to show real growth? - HawkSearch is approaching 60% of subscription revenue, with expectations for significant growth in FY 2024 [33] Question: Can you provide insight into cash burn and projected cash position? - The company can manage financials to generate cash and can reduce non-personal marketing spending by $150,000 to $250,000 per quarter if needed [8][10] Question: What is the company's view on maintaining a diverse product base while scaling HawkSearch? - The company aims for HawkSearch to be as out-of-the-box as possible, with services revenue primarily driven by Unbound [34]