PROS(US:PRO)2022-11-01 20:24Revenue Growth - Subscription revenue increased by 17% and 15% for the three and nine months ended September 30, 2022, compared to the same periods in 2021, reaching $44.1 million and $150.9 million respectively[78] - Total revenue for the three and nine months ended September 30, 2022, increased by 12% and 10%, amounting to $62.7 million and $205.2 million respectively[85] - Recurring revenue accounted for 84% of total revenue for both the three and nine months ended September 30, 2022, consistent with the previous year[78] Profitability and Expenses - Gross revenue retention rates remained above 93% during the trailing twelve months ended September 30, 2022[79] - The gross profit margin for subscription revenue was 73% for the three months ended September 30, 2022, compared to 70% for the same period in 2021[91] - Maintenance and support revenue decreased by 17% for the three months ended September 30, 2022, totaling $8.5 million[86] - Selling and marketing expenses increased by $1.2 million (6%) for the three months ended September 30, 2022, and by $7.7 million (12%) for the nine months ended September 30, 2022[94] - Research and development expenses rose by $3.8 million (20%) for the three months ended September 30, 2022, and by $10.3 million (17%) for the nine months ended September 30, 2022[94] - General and administrative expenses increased by $1.5 million (12%) for the three months ended September 30, 2022, and by $6.0 million (17%) for the nine months ended September 30, 2022[94] Cash Flow and Financial Position - Free cash flow used during the three months ended September 30, 2022, was $9.1 million, compared to $8.5 million for the same period in 2021[80] - Net cash used in operating activities was $21.9 million for the nine months ended September 30, 2022, an increase of $4.4 million compared to the prior year[110] - Cash and cash equivalents decreased to $206.8 million at September 30, 2022, down from $227.6 million at December 31, 2021[106] Impairments and Charges - The company recorded a $1.6 million impairment charge related to fixed assets during the nine months ended September 30, 2022[99] Tax and Investment Gains - The effective tax rate was (1.9)% for the three months ended September 30, 2022, compared to (0.4)% for the same period in 2021[102] - A $3.3 million gain on equity investment was recognized in the quarter ended September 30, 2022, contributing to other income[101] Debt and Currency Exposure - The company had $150.0 million and $143.8 million of fixed-rate Notes outstanding as of September 30, 2022[122] - As of September 30, 2022, a hypothetical 10% adverse change in exchange rates would result in a loss of approximately $0.7 million on foreign denominated receivables[120] - A 10% adverse change in the value of the U.S. dollar against the euro would have decreased revenue by approximately $0.9 million and $2.8 million for the three and nine months ended September 30, 2022, respectively[120] - The company does not have material exposure to changes in fair value due to interest rate fluctuations because of the short-term nature of cash equivalents[123] - The company currently does not use derivative financial instruments to mitigate foreign currency exchange risks but may consider this in the future[121] Future Outlook - The company plans to continue investing in product development and technology to enhance existing solutions and attract new customers[81] - The ongoing migration of customers to cloud solutions is expected to lead to a decline in future maintenance and support revenue[83]