Domo(DOMO)2025-06-06 00:06Revenue and Performance - Total revenue for the three months ended April 30, 2024 and 2025 was $80.1 million, remaining relatively flat year-over-year [161]. - Total revenue for the three months ended April 30, 2025, was $80,111 thousand, a slight increase of $8 thousand compared to $80,103 thousand in the same period of 2024 [189]. - Remaining performance obligations (RPO) increased from $346.3 million in 2024 to $427.5 million in 2025, with $241.0 million expected to be recognized as revenue in the next twelve months [160]. - Subscription revenue decreased by $721 thousand, or 1%, from $72,110 thousand in 2024 to $71,389 thousand in 2025, primarily due to a $4.3 million net decrease from existing customers [193]. - Professional services and other revenue increased by $729 thousand, or 9%, from $7,993 thousand in 2024 to $8,722 thousand in 2025, driven by increases in event sponsorship and consulting revenue [194]. Customer and Market Dynamics - As of April 30, 2025, 70% of annual recurring revenue (ARR) was derived from consumption-based service agreements, with expectations for this percentage to increase [158]. - The company had over 2,500 customers as of April 30, 2025, with enterprise customers accounting for 45% of revenue [167]. - The macroeconomic environment has elongated the software sales cycle and increased deal scrutiny, potentially impacting revenue growth in the near term [162]. Financial Performance - Net losses were $26.0 million for the three months ended April 30, 2024, and $18.1 million for the same period in 2025, with an accumulated deficit of $1.5056 billion as of April 30, 2025 [163]. - Net loss for the three months ended April 30, 2025, was $18,052 thousand, compared to a net loss of $26,007 thousand in 2024, reflecting an improvement of $7,955 thousand [189]. - Cash collected from customers during the three months ended April 30, 2025 was $93.2 million, exceeding cash outflows of $89.2 million [217]. - Net cash provided by operating activities for the three months ended April 30, 2025 was $3.951 million, compared to $1.901 million for the same period in 2024 [214]. Expenses and Cost Management - Total operating expenses decreased by $7,050 thousand, or 9%, from $80,839 thousand in 2024 to $73,789 thousand in 2025, with significant reductions in sales and marketing, research and development, and general and administrative expenses [199]. - Sales and marketing expenses as a percentage of total revenue increased from 50% in 2024 to 53% in 2025 [174]. - Research and development expenses as a percentage of total revenue increased from 25% in 2025 to 28% in 2024, indicating a focus on future growth [176]. - Research and development expenses decreased by $2,758 thousand, or 12%, from $22,719 thousand in 2024 to $19,961 thousand in 2025, with a decrease in employee-related costs [200]. - General and administrative expenses decreased by $1,734 thousand, or 11%, from $15,901 thousand in 2024 to $14,167 thousand in 2025, primarily due to a reduction in professional and legal fees [201]. Liquidity and Financing - Cash and cash equivalents as of April 30, 2025, totaled $47.2 million, held primarily for working capital purposes [204]. - The company has a $125.3 million credit facility, all of which had been drawn as of April 30, 2025 [204]. - The company is required to maintain a minimum liquidity of $25.0 million in unrestricted cash as per the credit facility [213]. - As of April 30, 2025, the cash interest rate on the term loan was approximately 7.3%, with an additional fixed rate of 5.0% accruing on the outstanding principal [212]. Economic and Inflation Considerations - The company does not believe inflation has materially affected its business or financial condition to date [232]. - Subscription contracts often contain pricing terms tied to the Consumer Price Index (CPI), and renewal pricing policies are designed to approximate CPI changes [232]. - If costs become subject to significant inflationary pressure, the company may not be able to fully offset these costs with price increases, which could adversely affect its financial condition [232]. - A hypothetical change in interest rates of 100 basis points would not have a material impact on the fair value of the company's outstanding debt [229]. Strategic Initiatives - The company entered into a Controlled Equity Offering Sales Agreement to sell up to $150.0 million of Class B common stock, with a commission of 3.0% on gross proceeds [208]. - The company has no current agreements for potential investments or acquisitions but may seek additional equity financing in the future [208]. - The company has experienced fluctuations in net loss due to transaction gains or losses from remeasuring current asset and liability balances in foreign currencies [231]. - The company has not engaged in hedging foreign currency transactions to date but is considering the costs and benefits of initiating such a program as it expands international operations [231].