Alkami Announces Third Quarter 2024 Financial Results
Third Quarter 2024 Financial Highlights
- GAAP total revenue of
$85.9 million , an increase of 26.9% compared to the year-ago quarter; - GAAP gross margin of 58.9%, compared to 54.0% in the year-ago quarter;
- Non-GAAP gross margin of 62.8%, compared to 58.7% in the year-ago quarter;
- GAAP net loss of
$(9.4) million , compared to$(15.5) million in the year-ago quarter; and - Adjusted EBITDA of
$8.3 million , compared to$0.8 million in the year-ago quarter.
Comments on the News
Shootman added, "In the third quarter we signed nine new digital banking clients, including six credit unions and three banks. We also renewed 14 clients, with several clients extending to 2031 and adding an additional 7 products to their portfolios.
2024 Financial Outlook
- GAAP total revenue in the range of
$89.0 million to$90.0 million ; - Adjusted EBITDA in the range of
$8.5 million to$9.0 million .
- GAAP total revenue in the range of
$333.2 million to$334.2 million ; - Adjusted EBITDA in the range of
$25.2 million to$25.7 million .
Conference Call Information
The Company will host a conference call at
About
Cautionary Statement Regarding Forward-Looking Statements
This press release contains "forward-looking" statements relating to
Explanation of Non-GAAP Financial Measures and Key Business Metrics
The company reports its financial results in accordance with accounting principles generally accepted in
The company defines "Non-GAAP Cost of Revenues" as cost of revenues, excluding (1) amortization and (2) stock-based compensation expense. The company believes that investors and financial analysts find this non-GAAP financial measure to be useful in analyzing the company's financial and operational performance, comparing this performance to the company's peers and competitors, and understanding the company's ability to generate income from ongoing business operations.
The company defines "Non-GAAP Gross Margin" as gross profit, plus (1) amortization and (2) stock-based compensation expense, all divided by revenue. The company believes that investors and financial analysts find this non-GAAP financial measure to be useful in analyzing the company's financial and operational performance, comparing this performance to the company's peers and competitors, and understanding the company's ability to generate income from ongoing business operations.
The company defines "
The company defines "Non-GAAP Sales and Marketing Expense" as sales and marketing expense, excluding stock-based compensation expense. The company believes that investors and financial analysts find this non-GAAP financial measure to be useful in analyzing the company's financial and operational performance, comparing this performance to the company's peers and competitors, and understanding the company's ongoing expenditures related to its sales and marketing strategies.
The company defines "Non-GAAP General and Administrative Expense" as general and administrative expense, excluding (1) stock-based compensation expense and (2) secondary offering costs. The company believes that investors and financial analysts find this non-GAAP financial measure to be useful in analyzing the company's financial and operational performance, comparing this performance to the company's peers and competitors, and understanding the company's underlying expense structure to support corporate activities and processes.
The company defines "Non-GAAP Income (loss) before income taxes" as loss before income taxes, plus (1) gain on financial instruments, (2) amortization, (3) stock-based compensation expense, (4) secondary offering costs, and (5) acquisition-related expenses. The company believes that investors and financial analysts find this non-GAAP financial measure to be useful in analyzing the company's financial and operational performance, comparing this performance to the company's peers and competitors, and understanding the company's ability to generate income from ongoing business operations.
The company defines "Adjusted EBITDA" as net loss plus (1) provision (benefit) for income taxes, (2) gain on financial instruments, (3) interest income, net, (4) depreciation and amortization (5) stock-based compensation expense, (6) secondary offering costs, and (7) acquisition-related expenses. The company believes adjusted EBITDA provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations.
In addition, the Company also uses the following important operating metrics to evaluate its business:
The company defines "Annual Recurring Revenue (ARR)" by aggregating annualized recurring revenue related to SaaS subscription services recognized in the last month of the reporting period as well as the next 12 months of expected implementation services revenues in the last month of the reporting period. We believe ARR provides important information about our future revenue potential, our ability to acquire new clients, and our ability to maintain and expand our relationship with existing clients.
The company defines "Registered Users" as an individual or business related to an account holder of an FI client on our digital banking platform who has registered to use one or more of our solutions and has current access to use those solutions as of the last day of the reporting period presented. We price our digital banking platform based on the number of registered users, so as the number of registered users of our digital banking platform increases, our ARR grows. We believe growth in the number of registered users provides important information about our ability to expand market adoption of our digital banking platform and its associated software products, and therefore to grow revenues over time.
The company defines "Revenue per Registered User (RPU)" by dividing ARR for the reporting period by the number of registered users as of the last day of the reporting period. We believe RPU provides important information about our ability to grow the number of software products adopted by new clients over time, as well as our ability to expand the number of software products that our existing clients add to their contracts with us over time.
The company does not provide a reconciliation of our adjusted EBITDA outlook to GAAP net loss because certain significant information required for such reconciliation is not available without unreasonable efforts, including provision for income taxes, loss on financial instruments, stock-based compensation expense, and acquisition-related expenses, net, all of which may be significant.
|
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CONDENSED CONSOLIDATED BALANCE SHEETS |
|||
(In thousands, except share and per share data) |
|||
(UNAUDITED) |
|||
|
|
|
|
|
2024 |
|
2023 |
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ 80,956 |
|
$ 40,927 |
Marketable securities |
20,033 |
|
51,196 |
Accounts receivable, net |
42,408 |
|
35,499 |
Deferred costs, current |
12,046 |
|
10,329 |
Prepaid expenses and other current assets |
13,563 |
|
10,634 |
Total current assets |
169,006 |
|
148,585 |
Property and equipment, net |
21,038 |
|
16,946 |
Right-of-use assets |
14,875 |
|
15,754 |
Deferred costs, net of current portion |
34,666 |
|
30,734 |
Intangibles, net |
30,718 |
|
35,807 |
|
148,050 |
|
148,050 |
Other assets |
3,840 |
|
3,949 |
Total assets |
$ 422,193 |
|
$ 399,825 |
Liabilities and Stockholders' Equity |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
$ 5,591 |
|
$ 7,478 |
Accrued liabilities |
28,049 |
|
19,763 |
Deferred revenues, current portion |
13,088 |
|
10,984 |
Lease liabilities, current portion |
1,309 |
|
1,205 |
Total current liabilities |
48,037 |
|
39,430 |
Deferred revenues, net of current portion |
16,267 |
|
15,384 |
Deferred income taxes |
1,774 |
|
1,713 |
Lease liabilities, net of current portion |
17,395 |
|
18,052 |
Other non-current liabilities |
216 |
|
305 |
Total liabilities |
83,689 |
|
74,884 |
Stockholders' Equity |
|
|
|
Preferred stock, |
— |
|
— |
Common stock, |
100 |
|
97 |
Additional paid-in capital |
806,962 |
|
760,210 |
Accumulated deficit |
(468,558) |
|
(435,366) |
Total stockholders' equity |
338,504 |
|
324,941 |
Total liabilities and stockholders' equity |
$ 422,193 |
|
$ 399,825 |
|
|
|
|
|
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(In thousands, except share and per share data) |
|||||||
(UNAUDITED) |
|||||||
|
|||||||
|
Three months ended |
|
Nine months ended |
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Revenues |
$ 85,906 |
|
$ 67,703 |
|
$ 244,193 |
|
$ 193,462 |
Cost of revenues(1) |
35,289 |
|
31,153 |
|
100,773 |
|
89,300 |
Gross profit |
50,617 |
|
36,550 |
|
143,420 |
|
104,162 |
Operating expenses: |
|
|
|
|
|
|
|
Research and development |
24,133 |
|
21,755 |
|
70,862 |
|
63,170 |
Sales and marketing |
14,406 |
|
11,933 |
|
45,213 |
|
36,694 |
General and administrative |
22,147 |
|
18,290 |
|
62,074 |
|
53,608 |
Acquisition-related expenses |
— |
|
— |
|
195 |
|
220 |
Amortization of acquired intangibles |
359 |
|
359 |
|
1,076 |
|
1,076 |
Total operating expenses |
61,045 |
|
52,337 |
|
179,420 |
|
154,768 |
Loss from operations |
(10,428) |
|
(15,787) |
|
(36,000) |
|
(50,606) |
Non-operating income (expense): |
|
|
|
|
|
|
|
Interest income |
1,147 |
|
2,080 |
|
3,490 |
|
5,822 |
Interest expense |
(180) |
|
(1,931) |
|
(327) |
|
(5,514) |
Gain on financial instruments |
— |
|
201 |
|
— |
|
421 |
Loss before income taxes |
(9,461) |
|
(15,437) |
|
(32,837) |
|
(49,877) |
Provision (benefit) for income taxes |
(19) |
|
39 |
|
355 |
|
323 |
Net loss |
$ (9,442) |
|
$ (15,476) |
|
$ (33,192) |
|
$ (50,200) |
Net loss per share attributable to common stockholders: |
|
|
|
|
|
|
|
Basic and diluted |
$ (0.09) |
|
$ (0.16) |
|
$ (0.34) |
|
$ (0.54) |
Weighted average number of shares of common stock outstanding: |
|
|
|
|
|
|
|
Basic and diluted |
99,435,002 |
|
94,675,358 |
|
98,165,903 |
|
93,477,486 |
|
(1) Includes amortization of acquired technology of |
|
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||
(In thousands) |
|||
(UNAUDITED) |
|||
|
Nine months ended |
||
|
2024 |
|
2023 |
Cash flows from operating activities: |
|
|
|
Net loss |
$ (33,192) |
|
$ (50,200) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
|
|
|
Depreciation and amortization expense |
7,854 |
|
7,841 |
Accrued interest on marketable securities, net |
(928) |
|
(2,059) |
Stock-based compensation expense |
43,822 |
|
37,914 |
Amortization of debt issuance costs |
161 |
|
110 |
Gain on financial instruments |
— |
|
(430) |
Gain on lease modification |
— |
|
(375) |
Deferred taxes |
61 |
|
118 |
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable |
(6,909) |
|
(5,020) |
Prepaid expenses and other current assets |
(2,619) |
|
(2,631) |
Accounts payable and accrued liabilities |
6,316 |
|
5,223 |
Deferred costs |
(5,067) |
|
(3,959) |
Deferred revenues |
2,987 |
|
1,271 |
Net cash provided by (used in) operating activities |
12,486 |
|
(12,197) |
Cash flows from investing activities: |
|
|
|
Purchase of marketable securities |
(30,721) |
|
(109,593) |
Proceeds from sales, maturities and redemptions of marketable securities |
62,812 |
|
97,852 |
Purchases of property and equipment |
(1,036) |
|
(774) |
Capitalized software development costs |
(5,009) |
|
(3,843) |
Net cash provided by (used in) investing activities |
26,046 |
|
(16,358) |
Cash flows from financing activities: |
|
|
|
Principal payments on debt |
— |
|
(2,125) |
Debt issuance costs paid |
(363) |
|
(341) |
Proceeds from Employee Stock Purchase Plan issuances |
2,598 |
|
2,407 |
Payment of holdback funds from acquisition |
— |
|
(1,000) |
Payments for taxes related to net settlement of equity awards |
(12,820) |
|
(11,029) |
Proceeds from stock option exercises |
12,082 |
|
7,287 |
Net cash provided by (used in) financing activities |
1,497 |
|
(4,801) |
Net increase (decrease) in cash and cash equivalents and restricted cash |
40,029 |
|
(33,356) |
Cash and cash equivalents and restricted cash, beginning of period |
40,927 |
|
112,337 |
Cash and cash equivalents and restricted cash, end of period |
$ 80,956 |
|
$ 78,981 |
|
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RECONCILIATION OF GAAP TO NON-GAAP MEASURES |
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(In thousands, except per share data) |
|||||||
(UNAUDITED) |
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP total revenues |
$ 85,906 |
|
$ 67,703 |
|
$ 244,193 |
|
$ 193,462 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
2024 |
|
2023 |
|
|
|
|
Annual Recurring Revenue (ARR) |
$ 342,101 |
|
$ 274,976 |
|
|
|
|
Registered Users |
19,499 |
|
16,891 |
|
|
|
|
Revenue per Registered User (RPU) |
$ 17.54 |
|
$ 16.28 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Cost of Revenues |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Non-GAAP Cost of Revenues." Please reference the "Explanation of Non-GAAP Measures" section. |
|||||||
|
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP cost of revenues |
$ 35,289 |
|
$ 31,153 |
|
$ 100,773 |
|
$ 89,300 |
Amortization |
(1,895) |
|
(1,686) |
|
(5,463) |
|
(4,923) |
Stock-based compensation expense |
(1,407) |
|
(1,507) |
|
(3,932) |
|
(4,140) |
Non-GAAP cost of revenues |
$ 31,987 |
|
$ 27,960 |
|
$ 91,378 |
|
$ 80,237 |
|
|
|
|
|
|
|
|
Non-GAAP Gross Margin |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Non-GAAP Gross Margin." Please reference the "Explanation of Non-GAAP Measures" section. |
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|
Three Months Ended |
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Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP gross margin |
58.9 % |
|
54.0 % |
|
58.7 % |
|
53.8 % |
Amortization |
2.3 % |
|
2.5 % |
|
2.3 % |
|
2.6 % |
Stock-based compensation expense |
1.6 % |
|
2.2 % |
|
1.6 % |
|
2.1 % |
Non-GAAP gross margin |
62.8 % |
|
58.7 % |
|
62.6 % |
|
58.5 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Set forth below is a presentation of the company's " |
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|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP research and development expense |
$ 24,133 |
|
$ 21,755 |
|
$ 70,862 |
|
$ 63,170 |
Stock-based compensation expense |
(4,492) |
|
(4,116) |
|
(12,746) |
|
(11,854) |
Non-GAAP research and development expense |
$ 19,641 |
|
$ 17,639 |
|
$ 58,116 |
|
$ 51,316 |
|
|
|
|
|
|
|
|
Non-GAAP Sales and Marketing Expense |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Non-GAAP Sales and Marketing Expense." Please reference the "Explanation of Non-GAAP Measures" section. |
|||||||
|
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP sales and marketing expense |
$ 14,406 |
|
$ 11,933 |
|
$ 45,213 |
|
$ 36,694 |
Stock-based compensation expense |
(2,327) |
|
(1,906) |
|
(6,649) |
|
(5,309) |
Non-GAAP sales and marketing expense |
$ 12,079 |
|
$ 10,027 |
|
$ 38,564 |
|
$ 31,385 |
|
|
|
|
|
|
|
|
Non-GAAP General and Administrative Expense |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Non-GAAP General and Administrative Expense." Please reference the "Explanation of Non-GAAP Measures" section. |
|||||||
|
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP general and administrative expense |
$ 22,147 |
|
$ 18,290 |
|
$ 62,074 |
|
$ 53,608 |
Stock-based compensation expense |
(7,031) |
|
(6,389) |
|
(20,495) |
|
(16,611) |
Secondary offering costs |
(810) |
|
— |
|
(810) |
|
— |
Non-GAAP general and administrative expense |
$ 14,306 |
|
$ 11,901 |
|
$ 40,769 |
|
$ 36,997 |
|
|
|
|
|
|
|
|
Non-GAAP Income (Loss) Before Income Taxes |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Non-GAAP Income (Loss) Before Income Taxes." Please reference the "Explanation of Non-GAAP Measures" section. |
|||||||
|
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP loss before income taxes |
$ (9,461) |
|
$ (15,437) |
|
$ (32,837) |
|
$ (49,877) |
Gain on financial instruments |
— |
|
(201) |
|
— |
|
(421) |
Amortization |
2,254 |
|
2,045 |
|
6,539 |
|
5,999 |
Stock-based compensation expense |
15,257 |
|
13,918 |
|
43,822 |
|
37,914 |
Secondary offering costs |
810 |
|
— |
|
810 |
|
— |
Acquisition-related expenses |
— |
|
— |
|
195 |
|
220 |
Non-GAAP Income (loss) before income taxes |
$ 8,860 |
|
$ 325 |
|
$ 18,529 |
|
$ (6,165) |
|
|
|
|
|
|
|
|
Adjusted EBITDA |
|
|
|
|
|
||
Set forth below is a presentation of the company's "Adjusted EBITDA." Please reference the "Explanation of Non-GAAP Measures" section. |
|||||||
|
|||||||
|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
|
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
GAAP net loss |
$ (9,442) |
|
$ (15,476) |
|
$ (33,192) |
|
$ (50,200) |
Provision (benefit) for income taxes |
(19) |
|
39 |
|
355 |
|
323 |
Gain on financial instruments |
— |
|
(201) |
|
— |
|
(421) |
Interest income, net |
(967) |
|
(149) |
|
(3,163) |
|
(308) |
Depreciation and amortization |
2,679 |
|
2,695 |
|
7,854 |
|
7,841 |
Stock-based compensation expense |
15,257 |
|
13,918 |
|
43,822 |
|
37,914 |
Secondary offering costs |
810 |
|
— |
|
810 |
|
— |
Acquisition-related expenses |
— |
|
— |
|
195 |
|
220 |
Adjusted EBITDA |
$ 8,318 |
|
$ 826 |
|
$ 16,681 |
|
$ (4,631) |
|
|
|
|
|
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|
Investor Relations Contact
ir@alkami.com
Media Relations Contacts
marla.pieton@alkami.com
alkami@fullyvested.com
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