Business Wire | Dec 9, 2020 04:03PM EST

Asana Announces Record Third Quarter Revenues

Dec. 09, 2020

SAN FRANCISCO--(BUSINESS WIRE)--Dec. 09, 2020--Asana, Inc. (NYSE: ASAN), a leading work management platform for teams, today reported financial results for its third quarter ended October 31, 2020.

"We reported a very strong quarter, with total revenue growth of 55 percent year over year and growth of revenue from customers who spend $5,000 or more on an annualized basis of over 80 percent year over year," said Dustin Moskovitz, co-founder and chief executive officer of Asana. "With the acceleration of digital transformation, organizations are reimagining every aspect of business operations to ensure that people can stay engaged, aligned and effective, no matter where they are. Asana's Work Graph provides the power, flexibility and control that organizations need to orchestrate work at scale."

Third Quarter Fiscal 2021 Financial Highlights

* Revenues: Revenues were $58.9 million, an increase of 55% year over year. * Operating Loss: GAAP operating loss was $61.9 million, or 105.1% of revenues, compared to GAAP operating loss of $63.1 million, or 165.7% of revenues, in the third quarter of fiscal 2020. Non-GAAP operating loss was $37.3 million, or 63.3% of revenues, compared to non-GAAP operating loss of $21.5 million, or 56.3% of revenues, in the third quarter of fiscal 2020. * Net Loss: GAAP net loss was $73.3 million, compared to GAAP net loss of $62.8 million in the third quarter of fiscal 2020. GAAP net loss per share was $0.65, compared to GAAP net loss per share of $0.89 in the third quarter of fiscal 2020. Non-GAAP net loss was $38.3 million, compared to non-GAAP net loss of $21.2 million in the third quarter of fiscal 2020. Non-GAAP net loss per share was $0.34, compared to non-GAAP net loss per share of $0.30 in the third quarter of fiscal 2020. * Cash Flow: Cash flows from operating activities were negative $34.4 million, compared to cash flows from operating activities of negative $10.9 million in the third quarter of fiscal 2020. Free cash flow was negative $19.5 million, compared to negative $11.6 million in the third quarter of fiscal 2020.

Business Highlights

* Expanded Asana's App ecosystem with a powerful set of best-in-class integrations with Zoom, Jira, Microsoft Teams and Slack. * Continued enterprise-ready product momentum announcing enhanced Rules functionality, and expanded administrative controls to help organizations stay connected at scale. * Ended the quarter with over 89,000 paying customers. * The number of customers spending $5,000 or more on an annualized basis grew to 8,938, an increase of 58% year over year. * The number of customers spending $50,000 or more on an annualized basis grew to 318, an increase of 104% year over year. * Overall dollar-based net retention rate was over 115%. * Dollar-based net retention rate for customers with $5,000 or more in annualized spend was over 125%. * Dollar-based net retention rate for customers with $50,000 or more in annualized spend was over 140%.

Financial Outlook

For the fourth quarter of fiscal 2021, Asana currently expects:

* Revenues of $62 million to $63 million, representing year-over-year growth of 43% to 45% * Non-GAAP operating loss of $42.5 million to $39.5 million * Non-GAAP net loss per share of $0.27 to $0.25, assuming basic and diluted weighted average shares outstanding of approximately 158 million

For the full fiscal year 2021, Asana currently expects:

* Revenues of $220.6 million to $221.6 million, representing year-over-year growth of 55% * Non-GAAP operating loss of $130.8 million to $127.8 million * Non-GAAP net loss per share of $1.24 to $1.21, assuming basic and diluted weighted average shares outstanding of approximately 106 million

These statements are forward-looking and actual results may materially differ. Refer to the "Forward-Looking Statements" section below for information on the factors that could cause Asana's actual results to materially differ from these forward-looking statements.

A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, many of these costs and expenses that may be incurred in the future. Asana has provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for its third quarter of fiscal 2021 non-GAAP results included in this press release.

Conference Call Information

Asana will host a conference call and live webcast for analysts and investors at 1:30 p.m. Pacific Time on December 9, 2020. A live webcast and accompanying presentation can be accessed on the Investor Relations section of Asana's website at: https://investors.asana.com. The conference call can also be accessed by dialing (833) 529-0220, or +1 236-389-2147 (outside of the US). The conference ID is 672-9445. A replay of the call via webcast will be available at https://investors.asana.com.

Forward-Looking Statements

This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements include, but are not limited to, statements about Asana's outlook for the fourth fiscal quarter and the full fiscal year ending January 31, 2021, Asana's market position, and potential market opportunities. Forward-looking statements generally relate to future events or Asana's future financial or operating performance. Forward-looking statements include all statements that are not historical facts and in some cases can be identified by terms such as "anticipate," "expect," "intend," "plan," "believe," "continue," "could," "potential," "remain," "may," "might," "will," "would" or similar expressions and the negatives of those terms. However, not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including factors beyond Asana's control, that may cause Asana's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to, risks and uncertainties related to: Asana's ability to achieve future growth and sustain its growth rate, Asana's ability to attract and retain customers and increase sales to its customers, Asana's ability to develop and release new products and services and to scale its platform, Asana's ability to increase adoption of its platform through Asana's self-service model, Asana's ability to maintain and grow its relationships with strategic partners, the highly competitive and rapidly evolving market in which Asana participates, Asana's international expansion strategies, and the impact of the COVID-19 pandemic. Further information on risks that could cause actual results to differ materially from forecasted results are included in Asana's filings with the SEC, including Asana's final prospectus filed on September 30, 2020 with the SEC. Any forward-looking statements contained in this press release are based on assumptions that Asana believes to be reasonable as of this date. Except as required by law, Asana assumes no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Use of Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and presented in accordance with GAAP, Asana uses certain non-GAAP financial measures, as described below, to understand and evaluate its core operating performance. These non-GAAP financial measures, which may be different from similarly titled measures used by other companies, are presented to enhance investors' overall understanding of Asana's financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures can be found in the accompanying financial statements included with this press release.

Asana believes that these non-GAAP financial measures provide useful information about its financial performance, enhance the overall understanding of Asana's past performance and future prospects, facilitate period-to-period comparisons of operations, and allow for greater transparency with respect to important metrics used by Asana's management for financial and operational decision-making. Asana is presenting these non-GAAP financial metrics to assist investors in seeing its financial performance through the eyes of management, and because Asana believes that these measures provide an additional tool for investors to use in comparing its core financial performance over multiple periods with other companies in Asana's industry.

Asana defines non-GAAP operating loss as GAAP loss from operations plus stock-based compensation expense and non-recurring costs such as direct listing expenses. Asana defines non-GAAP net loss as GAAP net loss plus stock-based compensation expense, amortization of discount and non-cash contractual interest expense related to its senior mandatory convertible promissory note, and non-recurring costs such as direct listing expenses. There are a number of limitations related to the use of these non-GAAP measures as compared to GAAP operating loss and net loss, including that the non-GAAP measures exclude stock-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense in Asana's business and an important part of its compensation strategy.

Asana also uses the non-GAAP financial measure of free cash flow, which is defined as net cash used in operating activities less cash used for purchases of property and equipment and capitalized internal-use software costs, plus non-recurring expenditures such as capital expenditures from the purchases of property and equipment associated with the build-out of Asana's corporate headquarters in San Francisco and direct listing expenses. Asana believes free cash flow is an important liquidity measure of the cash that is available, after capital expenditures and operational expenses, for investment in its business and to make acquisitions. Free cash flow is useful to investors as a liquidity measure because it measures Asana's ability to generate or use cash. There are a number of limitations related to the use of free cash flow as compared to net cash from operating activities, including that free cash flow includes capital expenditures, the benefits of which are realized in periods subsequent to those when expenditures are made.

Definitions of Business Metrics

Dollar-based net retention rate

Asana's reported dollar-based net retention rate equals the simple arithmetic average of its quarterly dollar-based net retention rate for the four quarters ending with the most recent fiscal quarter. Asana calculates its dollar-based net retention rate by comparing its revenues from the same set of customers in a given quarter, relative to the comparable prior-year period. To calculate Asana's dollar-based net retention rate for a given quarter, Asana starts with the revenues in that quarter from customers that generated revenues in the same quarter of the prior year. Asana then divides that amount by the revenues attributable to that same group of customers in the prior-year quarter. Current period revenues include any upsells and are net of contraction or attrition over the trailing 12 months, but exclude revenues from new customers in the current period. Asana expects its dollar-based net retention rate to fluctuate in future periods due to a number of factors, including the expected growth of its revenue base, the level of penetration within its customer base, and its ability to retain its customers.

About Asana

Asana helps teams orchestrate their work, from small projects to strategic initiatives. Headquartered in San Francisco, CA, Asana has more than 89,000 paying customers and millions of free organizations across 190 countries. Global customers such as Allbirds, Sephora, Sky, Spotify, Viessmann and Woolworths rely on Asana to manage everything from company objectives to digital transformation to product launches and marketing campaigns.

Disclosure of Material Information

Asana announces material information to its investors using SEC filings, press releases, public conference calls, and on its investor relations page of Asana's website at https://investors.asana.com. Asana uses these channels, as well as social media, including its Twitter account (@asana), its blog (blog.asana.com), its LinkedIn page (www.linkedin.com/company/asana), its Instagram account (@asana), and its Facebook page (www.facebook.com/asana/), to communicate with investors and the public about Asana, its products and services and other matters. Therefore, Asana encourages investors, the media and others interested in Asana to review the information it makes public in these locations, as such information could be deemed to be material information.

ASANA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)

Three Months Ended Nine Months Ended October October 31, 31,

2020 2019 2020 2019

Revenues $ 58,905 $ 38,079 $ 158,635 $ 99,136

Cost of revenues^(1) 7,321 5,328 20,548 14,079

Gross profit 51,584 32,751 138,087 85,057

Operating expenses:

Research and development 32,996 39,712 81,338 69,588 ^(1)

Sales and marketing^(1) 48,039 35,902 122,952 74,927

General and 32,483 20,222 58,400 34,871 administrative^(1)

Total operating expenses 113,518 95,836 262,690 179,386

Loss from operations (61,934 ) (63,085 ) (124,603 ) (94,329 )

Interest income andother income (expense), (389 ) 343 1,010 1,168 net

Interest expense (10,351 ) - (25,706 ) -

Loss before provision (72,674 ) (62,742 ) (149,299 ) (93,161 )for income taxes

Provision for income 615 61 901 183 taxes

Net loss $ (73,289 ) $ (62,803 ) $ (150,200 ) $ (93,344 )

Net loss per share:

Basic and diluted $ (0.65 ) $ (0.89 ) $ (1.70 ) $ (1.35 )

Weighted-average sharesused in calculating net loss per share:

Basic and diluted 113,264 70,736 88,539 69,053

_______________

(1) Amounts include stock-based compensation expense as follows:

Three Months Ended Nine Months Ended October October 31, 31,

2020 2019 2020 2019

Cost of revenues $ 75 $ 77 $ 175 $ 90

Research and development 4,783 21,068 9,520 22,950

Sales and marketing 2,463 8,441 5,084 9,402

General and 1,620 12,042 3,520 12,614 administrative

Total stock-based $ 8,941 $ 41,628 $ 18,299 $ 45,056 compensation expense

ASANA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

October 31, 2020

January 31, 2020

Assets

Current assets

Cash and cash equivalents

$

297,425

$

306,020

Marketable securities

126,439

45,288

Accounts receivable, net

23,287

12,659

Prepaid expenses and other current assets

25,277

16,667

Total current assets

472,428

380,634

Property and equipment, net

54,787

10,100

Restricted cash, noncurrent

-

4,657

Operating lease right-of-use assets

138,752

20,818

Other assets

8,018

5,483

Total assets

$

673,985

$

421,692

Liabilities, Redeemable Convertible Preferred Stock, and Stockholders' (Deficit) Equity

Current liabilities

Accounts payable

$

16,291

$

7,549

Accrued expenses and other current liabilities

36,331

18,241

Deferred revenue, current (1)

88,871

62,725

Operating lease liabilities, current

10,960

11,613

Total current liabilities

152,453

100,128

Term loan, net

12,491

-

Convertible notes, net-related party

340,788

203,097

Operating lease liabilities, noncurrent

138,141

10,472

Other liabilities(1)

2,416

2,729

Total liabilities

646,289

316,426

Commitments and contingencies

Redeemable convertible preferred stock

-

250,581

Stockholders' (deficit) equity

Common stock

2

1

Additional paid-in capital

507,737

184,522

Accumulated other comprehensive loss

(107)

(102)

Accumulated deficit

(479,936)

(329,736)

Total stockholders' (deficit) equity

27,696

(145,315)

Total liabilities, redeemable convertible preferred stock, and stockholders' (deficit) equity

$

673,985

$

421,692

_______________

(1) Total deferred revenue was $90.1 million as of October 31, 2020 (unaudited), of which $1.3 million, is presented within other liabilities, as a noncurrent liability, in the consolidated balance sheets.

ASANA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

October 31, January 31, 2020 2020

Assets

Current assets

Cash and cash equivalents $ 297,425 $ 306,020

Marketable securities 126,439 45,288

Accounts receivable, net 23,287 12,659

Prepaid expenses and other current assets 25,277 16,667

Total current assets 472,428 380,634

Property and equipment, net 54,787 10,100

Restricted cash, noncurrent - 4,657

Operating lease right-of-use assets 138,752 20,818

Other assets 8,018 5,483

Total assets $ 673,985 $ 421,692



Liabilities, Redeemable Convertible Preferred Stock, and Stockholders'(Deficit) Equity

Current liabilities

Accounts payable $ 16,291 $ 7,549

Accrued expenses and other current liabilities 36,331 18,241

Deferred revenue, current ^(1) 88,871 62,725

Operating lease liabilities, current 10,960 11,613

Total current liabilities 152,453 100,128

Term loan, net 12,491 -

Convertible notes, net-related party 340,788 203,097

Operating lease liabilities, noncurrent 138,141 10,472

Other liabilities^(1) 2,416 2,729

Total liabilities 646,289 316,426

Commitments and contingencies

Redeemable convertible preferred stock - 250,581

Stockholders' (deficit) equity

Common stock 2 1

Additional paid-in capital 507,737 184,522

Accumulated other comprehensive loss (107) (102)

Accumulated deficit (479,936) (329,736)

Total stockholders' (deficit) equity 27,696 (145,315)

Total liabilities, redeemable convertible preferred $ 673,985 $ 421,692 stock, and stockholders' (deficit) equity

_______________

(1) Total deferred revenue was $90.1 million as of October 31, 2020(unaudited), of which $1.3 million, is presented within other liabilities, as anoncurrent liability, in the consolidated balance sheets.

ASANA, INC.

SUMMARY OF CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

Three Months Ended October 31,

Nine Months Ended October 31,

2020

2019

2020

2019

Cash flows from operating activities

Net loss

$

(73,289

)

$

(62,803

)

$

(150,200

)

$

(93,344

)

Adjustments to reconcile net loss to net cash used in operating activities:

Allowance for doubtful accounts

84

122

1,204

298

Depreciation and amortization

992

528

2,508

1,691

Gain on sale of assets

(12

)

-

(12

)

-

Amortization of deferred contract acquisition costs

1,099

448

2,684

1,011

Stock-based compensation expense

8,941

41,628

18,299

45,056

Net accretion of discount of marketable securities

135

(184

)

82

(882

)

Change in fair value of redeemable convertible preferred stock warrant liability

-

55

-

109

Non-cash lease expense

5,250

2,025

11,835

5,731

Amortization of discount on convertible notes and term loan issuance costs

6,350

-

15,964

-

Non-cash interest expense

3,970

-

9,709

-

Changes in operating assets and liabilities:

Accounts receivable

(7,079

)

(3,138

)

(11,831

)

(5,238

)

Prepaid expenses and other current assets

(8,874

)

(3,007

)

(13,251

)

(5,358

)

Other assets

(1,175

)

(559

)

(2,537

)

(1,396

)

Accounts payable

299

828

1,840

2,611

Accrued expenses and other current liabilities

10,046

3,767

13,544

4,910

Deferred revenue

15,102

11,202

26,041

25,786

Operating lease liabilities

3,726

(1,851

)

(584

)

(5,024

)

Net cash used in operating activities

(34,435

)

(10,939

)

(74,705

)

(24,039

)

Cash flows from investing activities

Purchases of marketable securities

(126,613

)

(22,963

)

(126,613

)

(75,969

)

Sales of marketable securities

-

(3

)

-

2,677

Maturities of marketable securities

6,399

34,700

45,341

84,300

Purchases of property and equipment

(22,752

)

(1,006

)

(35,153

)

(1,855

)

Sales of property and equipment

12

-

12

-

Capitalized internal-use software

(40

)

-

(858

)

(302

)

Net cash provided by (used in) investing activities

(142,994

)

10,728

(117,271

)

8,851

Cash flows from financing activities

Proceeds from term loan, net of issuance costs

10,000

-

12,915

-

Proceeds from issuance of convertible notes-related party

-

-

150,000

-

Taxes paid related to net share settlement of equity awards

(192

)

-

(378

)

-

Repurchases of common stock

-

(59

)

-

(70

)

Proceeds from exercise of stock options

14,443

4,914

16,194

7,848

Net cash provided by financing activities

24,251

4,855

178,731

7,778

Effect of foreign exchange rates on cash and cash equivalents and restricted cash

(71

)

39

(7

)

41

Net increase (decrease) in cash, cash equivalents, and restricted cash

(153,249

)

4,683

(13,252

)

(7,369

)

Cash, cash equivalents, and restricted cash

Beginning of period

450,674

14,528

310,677

26,580

End of period

$

297,425

$

19,211

$

297,425

$

19,211

ASANA, INC.

SUMMARY OF CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

Three Months Ended October Nine Months Ended October 31, 31,

2020 2019 2020 2019

Cash flows fromoperating activities

Net loss $ (73,289 ) $ (62,803 ) $ (150,200 ) $ (93,344 )

Adjustments toreconcile netloss to net cash used in operatingactivities:

Allowance for 84 122 1,204 298 doubtful accounts

Depreciation and 992 528 2,508 1,691 amortization

Gain on sale of (12 ) - (12 ) - assets

Amortization ofdeferred contract 1,099 448 2,684 1,011 acquisition costs

Stock-basedcompensation 8,941 41,628 18,299 45,056 expense

Net accretion ofdiscount of 135 (184 ) 82 (882 ) marketablesecurities

Change in fairvalue ofredeemable - 55 - 109 convertiblepreferred stockwarrant liability

Non-cash lease 5,250 2,025 11,835 5,731 expense

Amortization ofdiscount onconvertible notes 6,350 - 15,964 - and term loanissuance costs

Non-cash interest 3,970 - 9,709 - expense

Changes inoperating assets and liabilities:

Accounts (7,079 ) (3,138 ) (11,831 ) (5,238 ) receivable

Prepaid expensesand other current (8,874 ) (3,007 ) (13,251 ) (5,358 ) assets

Other assets (1,175 ) (559 ) (2,537 ) (1,396 )

Accounts payable 299 828 1,840 2,611

Accrued expensesand other current 10,046 3,767 13,544 4,910 liabilities

Deferred revenue 15,102 11,202 26,041 25,786

Operating lease 3,726 (1,851 ) (584 ) (5,024 ) liabilities

Net cash used inoperating (34,435 ) (10,939 ) (74,705 ) (24,039 ) activities

Cash flows frominvesting activities

Purchases ofmarketable (126,613 ) (22,963 ) (126,613 ) (75,969 ) securities

Sales ofmarketable - (3 ) - 2,677 securities

Maturities ofmarketable 6,399 34,700 45,341 84,300 securities

Purchases ofproperty and (22,752 ) (1,006 ) (35,153 ) (1,855 ) equipment

Sales of property 12 - 12 - and equipment

Capitalizedinternal-use (40 ) - (858 ) (302 ) software

Net cash providedby (used in) (142,994 ) 10,728 (117,271 ) 8,851 investingactivities

Cash flows fromfinancing activities

Proceeds fromterm loan, net of 10,000 - 12,915 - issuance costs

Proceeds fromissuance ofconvertible - - 150,000 - notes-relatedparty

Taxes paidrelated to net (192 ) - (378 ) - share settlementof equity awards

Repurchases of - (59 ) - (70 ) common stock

Proceeds fromexercise of stock 14,443 4,914 16,194 7,848 options

Net cash providedby financing 24,251 4,855 178,731 7,778 activities

Effect of foreignexchange rates oncash and cash (71 ) 39 (7 ) 41 equivalents andrestricted cash

Net increase(decrease) incash, cash (153,249 ) 4,683 (13,252 ) (7,369 ) equivalents, andrestricted cash

Cash, cashequivalents, and restricted cash

Beginning of 450,674 14,528 310,677 26,580 period

End of period $ 297,425 $ 19,211 $ 297,425 $ 19,211

ASANA, INC.

Reconciliation of GAAP to Non-GAAP Data

(In thousands, except percentages)

(unaudited)

Three Months EndedOctober 31,

Nine Months EndedOctober 31,

2020

2019

2020

2019

Reconciliation of gross profit and gross margin

GAAP gross profit

$

51,584

$

32,751

$

138,087

$

85,057

Plus: stock-based compensation

75

77

175

90

Non-GAAP gross profit

$

51,659

$

32,828

$

138,262

$

85,147

GAAP gross margin

87.6%

86.0%

87.0%

85.8%

Non-GAAP adjustments

0.1%

0.2%

0.2%

0.1%

Non-GAAP gross margin

87.7%

86.2%

87.2%

85.9%

Reconciliation of operating expenses

GAAP research and development

$

32,996

$

39,712

$

81,338

$

69,588

Less: stock-based compensation

(4,783)

(21,068)

(9,520)

(22,950)

Non-GAAP research and development

$

28,213

$

18,644

$

71,818

$

46,638

GAAP research and development as percentage of revenue

56.0%

104.3%

51.3%

70.2%

Non-GAAP research and development as percentage of revenue

47.9%

49.0%

45.3%

47.0%

GAAP sales and marketing

$

48,039

$

35,902

$

122,952

$

74,927

Less: stock-based compensation

(2,463)

(8,441)

(5,084)

(9,402)

Non-GAAP sales and marketing

$

45,576

$

27,461

$

117,868

$

65,525

GAAP sales and marketing as percentage of revenue

81.6%

94.3%

77.5%

75.6%

Non-GAAP sales and marketing as percentage of revenue

77.4%

72.1%

74.3%

66.1%

GAAP general and administrative

$

32,483

$

20,222

$

58,400

$

34,871

Less: stock-based compensation

(1,620)

(12,042)

(3,520)

(12,614)

Less: direct listing expenses

(15,718)

-

(17,955)

-

Non-GAAP general and administrative

$

15,145

$

8,180

$

36,925

$

22,257

GAAP general and administrative as percentage of revenue

55.1%

53.1%

36.8%

35.2%

Non-GAAP general and administrative as percentage of

revenue

25.7%

21.5%

23.3%

22.5%

Reconciliation of operating loss and operating margin

GAAP loss from operations

$

(61,934)

$

(63,085)

$

(124,603)

$

(94,329)

Plus: stock-based compensation

8,941

41,628

18,299

45,056

Plus: direct listing expenses

15,718

-

17,955

-

Non-GAAP loss from operations

$

(37,275)

$

(21,457)

$

(88,349)

$

(49,273)

GAAP operating margin

(105.1)%

(165.7)%

(78.5)%

(95.2)%

Non-GAAP adjustments

41.8%

109.4%

22.8%

45.5%

Non-GAAP operating margin

(63.3)%

(56.3)%

(55.7)%

(49.7)%

ASANA, INC.

Reconciliation of GAAP to Non-GAAP Data

(In thousands, except percentages)

(unaudited)

Three Months Ended Nine Months Ended October 31, October 31,

2020 2019 2020 2019

Reconciliation of gross profit and gross margin

GAAP gross profit $ 51,584 $ 32,751 $ 138,087 $ 85,057

Plus: stock-based 75 77 175 90compensation

Non-GAAP gross profit $ 51,659 $ 32,828 $ 138,262 $ 85,147

GAAP gross margin 87.6% 86.0% 87.0% 85.8%

Non-GAAP adjustments 0.1% 0.2% 0.2% 0.1%

Non-GAAP gross margin 87.7% 86.2% 87.2% 85.9%

Reconciliation of operating expenses

GAAP research and $ 32,996 $ 39,712 $ 81,338 $ 69,588development

Less: stock-based (4,783) (21,068) (9,520) (22,950)compensation

Non-GAAP research and $ 28,213 $ 18,644 $ 71,818 $ 46,638development

GAAP research anddevelopment as percentage 56.0% 104.3% 51.3% 70.2%of revenue

Non-GAAP research anddevelopment as percentage 47.9% 49.0% 45.3% 47.0%of revenue

GAAP sales and marketing $ 48,039 $ 35,902 $ 122,952 $ 74,927

Less: stock-based (2,463) (8,441) (5,084) (9,402)compensation

Non-GAAP sales and $ 45,576 $ 27,461 $ 117,868 $ 65,525marketing

GAAP sales and marketing 81.6% 94.3% 77.5% 75.6%as percentage of revenue

Non-GAAP sales andmarketing as percentage of 77.4% 72.1% 74.3% 66.1%revenue

GAAP general and $ 32,483 $ 20,222 $ 58,400 $ 34,871administrative

Less: stock-based (1,620) (12,042) (3,520) (12,614)compensation

Less: direct listing (15,718) - (17,955) -expenses

Non-GAAP general and $ 15,145 $ 8,180 $ 36,925 $ 22,257administrative

GAAP general andadministrative as 55.1% 53.1% 36.8% 35.2%percentage of revenue

Non-GAAP general andadministrative aspercentage of 25.7% 21.5% 23.3% 22.5%

revenue

Reconciliation ofoperating loss and operating margin

GAAP loss from operations $ (61,934) $ (63,085) $ (124,603) $ (94,329)

Plus: stock-based 8,941 41,628 18,299 45,056compensation

Plus: direct listing 15,718 - 17,955 -expenses

Non-GAAP loss from $ (37,275) $ (21,457) $ (88,349) $ (49,273)operations

GAAP operating margin (105.1)% (165.7)% (78.5)% (95.2)%

Non-GAAP adjustments 41.8% 109.4% 22.8% 45.5%

Non-GAAP operating margin (63.3)% (56.3)% (55.7)% (49.7)%

ASANA, INC.

Reconciliation of GAAP to Non-GAAP Data

(In thousands, except percentages and per share data)

(unaudited)

Three Months Ended October 31,

Nine Months Ended October 31,

2020

2019

2020

2019

Reconciliation of net loss

GAAP net loss

$

(73,289

)

$

(62,803

)

$

(150,200

)

$

(93,344

)

Plus: stock-based compensation

8,941

41,628

18,299

45,056

Plus: amortization of debt discount

6,346

-

15,955

-

Plus: non-cash interest

3,970

-

9,709

-

Plus: direct listing expenses

15,718

-

17,955

-

Non-GAAP net loss

$

(38,314

)

$

(21,175

)

$

(88,282

)

$

(48,288

)

Reconciliation of net loss per share

GAAP net loss per share, basic

$

(0.65

)

$

(0.89

)

$

(1.70

)

$

(1.35

)

Non-GAAP adjustments to net loss

0.31

0.59

0.70

0.65

Non-GAAP net loss per share, basic

$

(0.34

)

$

(0.30

)

$

(1.00

)

$

(0.70

)

Weighted-average shares used in GAAP and non-GAAP per share calculation, basic and diluted

113,264

70,736

88,539

69,053

Three Months Ended October 31,

Nine Months Ended October 31,

2020

2019

2020

2019

Computation of free cash flow

Net cash provided by (used in) investing activities

$

(142,994

)

$

10,728

$

(117,271

)

$

8,851

Net cash provided by financing activities

$

24,251

$

4,855

$

178,731

$

7,778

Net cash used in operating activities

$

(34,435

)

$

(10,939

)

$

(74,705

)

$

(24,039

)

Less: purchases of property and equipment

(22,752

)

(1,006

)

(35,153

)

(1,855

)

Less: capitalized internal-use software

(40

)

-

(858

)

(302

)

Plus: purchases of property and equipment from build-out of corporate headquarters

21,822

343

33,130

754

Plus: direct listing expenses

15,903

-

19,112

-

Free cash flow

$

(19,502

)

$

(11,602

)

$

(58,474

)

$

(25,442

)

View source version on businesswire.com: https://www.businesswire.com/news/home/20201209005976/en/

CONTACT: Catherine Buan Asana Investor Relations ir@asana.com

CONTACT: Stephanie Hess Asana Corporate Communications press@asana.com