Business Wire | Dec 2, 2021 04:05PM EST

Domo Announces Third Quarter Fiscal 2022 Financial Results

Dec. 02, 2021

SILICON SLOPES, Utah--(BUSINESS WIRE)--Dec. 02, 2021--Domo, Inc. (Nasdaq: DOMO) today announced results for its fiscal third quarter ended October 31, 2021.

Fiscal Third Quarter Results

* Total revenue was $65.1 million, an increase of 21% year over year * Subscription revenue was $56.6 million, an increase of 21% year over year * Subscription revenue represented 87% of total revenue * Billings were $70.2 million or 26% year-over-year growth * Remaining Performance Obligations (RPO) was $296.9 million as of October 31, 2021, an increase of 19% year over year * RPO expected to be recognized as revenue in the next twelve months was $190.6 million as of October 31, 2021, an increase of 24% year over year * Net cash provided by operating activities was $0.03 million * GAAP subscription gross margin was 81%, an improvement of 1 percentage point from Q3 FY21 * Non-GAAP subscription gross margin was 83%, an improvement of 2 percentage points from Q3 FY21 * GAAP operating margin declined by 3 percentage points year over year * Non-GAAP operating margin improved by 6 percentage points year over year * GAAP net loss was $28.5 million, and GAAP net loss per share was $0.88, based on 32.4 million weighted-average shares outstanding * Non-GAAP net loss was $10.3 million, and non-GAAP net loss per share was $0.32, based on 32.4 million weighted-average shares outstanding * Cash and cash equivalents were $84.2 million as of October 31, 2021

"We delivered strong results for the quarter, driven by continued market demand for our core modern BI solution and fueled by increasing demand for data-enabled apps to help our customers run their businesses on the Domo platform," said Josh James, founder and CEO, Domo.

Recent Highlights

We believe the following recognition and research demonstrate our commitment to product innovation, go-to-market initiatives and customer success:

* Domo was named a Leader in Nucleus Research's 2021 Value Matrix for Embedded Analytics Technology. * Domo was named to Inc.'s first annual Best-Led Companies list - a select, data-driven list of the very strongest U.S. firms with revenue of $50 million to $2 billion. * Domo was named to Constellation Research's ShortList(tm) for Cloud-Based Business Intelligence and Analytics Platforms for Q3 2021 and for Marketing Analytics Solutions for Q3 2021. * Domo launched Sandbox, a new development and testing environment built on the Domo platform, to help customers more easily create and promote content into production across the enterprise.

Business Outlook

Based on information available as of December 2, 2021, Domo is providing the following guidance for its fourth fiscal quarter and full year fiscal 2022:

Q4 Fiscal 2022

* Revenue is expected to be in the range of $66.5 million to $67.5 million * Non-GAAP net loss per share is expected to be between $0.37 and $0.41 based on 32.8 million weighted-average shares outstanding

Full Year Fiscal 2022

* Revenue is expected to be in the range of $254.5 million to $255.5 million * Non-GAAP net loss per share is expected to be between $1.26 and $1.30 based on 32.0 million weighted-average shares outstanding

We have not reconciled guidance for non-GAAP metrics to their most directly comparable GAAP measures because such items that impact these measures are not within our control or cannot be reasonably predicted.

Earnings Call Details

Domo plans to host a conference call today to review its fiscal 2022 third quarter financial results and to discuss its financial outlook. The call is scheduled to begin at 3:00 p.m. MT/ 5:00 p.m. ET. A live webcast of the event will be available on the Domo Investor Relations website at https://www.domo.com/ir. Participants can register for the call in advance by visiting https://conferencingportals.com/event/zYvDlnjs. Instructions will be shared on how to join the call after registering.

A replay will be available at (800) 770-2030 or (647) 362-9199 with conference ID #41576 following the completion of the conference call until 11:59 p.m. (ET) December 16, 2021.

About Domo

Domo (Nasdaq: DOMO) is the Business Cloud, transforming the way business is managed by delivering Modern BI for All(tm). With Domo, critical processes that took weeks, months or more can now be done on-the-fly, in minutes or seconds, at unbelievable scale. For more information, visit www.domo.com. You can also follow Domo on Twitter, Facebook and LinkedIn.

Domo Disclosure Channels to Disseminate Information

Domo investors and others should note that we announce material information to the public about our company, products and services, and other issues through a variety of means, including Domo's website, press releases, SEC filings, blogs and social media, in order to achieve broad, non-exclusionary distribution of information to the public. We intend to use the Domo Facebook page, the Domo LinkedIn page, the Domo blog, the @Domotalk Twitter account and the @JoshJames Twitter account as a means of disclosing information about the Company and its services and for complying with the disclosure obligations under Regulation FD. The information we post through these social media channels may be deemed material. Accordingly, we encourage investors and others to monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described here may be updated from time to time as listed on our investor relations webpage.

Use of Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP), we reference in this press release and the accompanying tables the following non-GAAP financial measures: billings, non-GAAP subscription gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, adjusted net cash used in operating activities, and free cash flow. In computing these measures, we exclude the effects of certain items including stock-based compensation expense, amortization of certain intangible assets, the reversal of contingent tax-related accruals and proceeds from shares issued in connection with employee stock purchase plan. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and our non-GAAP measures may be different from non-GAAP measures used by other companies.

We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses that may not be indicative of our ongoing core business operating results. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when analyzing historical performance and liquidity and planning, forecasting, and analyzing future periods.

For a reconciliation of these non-GAAP financial measures to GAAP measures, please see the tables captioned "Reconciliation of Non-GAAP Financial Measures" included at the end of this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding our future growth, demand for our products and services, our financial outlook for our fourth fiscal quarter and full fiscal year 2022, and results for future periods. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our filings with the U.S. Securities and Exchange Commission, including, without limitation, the Annual Report on Form 10-K filed with the SEC on April 1, 2021 and the Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2021 expected to be filed with the SEC on or about December 10, 2021, as well as risks to our business related to the COVID-19 pandemic. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

Domo, Domo Business Cloud and Domo is the Business Cloud are registered trademarks of Domo, Inc.

Domo, Inc.Condensed Consolidated Statements of Operations(in thousands, except per share data)(unaudited) Three Months Ended Nine Months Ended October 31, October 31, 2020 2021 2020 2021

Revenue:Subscription $ 46,906 $ 56,621 $ 133,689 $ 163,399

Professional services 6,739 8,460 19,648 24,569 and otherTotal revenue 53,645 65,081 153,337 187,968

Cost of revenue:Subscription (1) 9,372 10,514 27,288 29,590

Professional services 5,106 6,630 14,948 19,030 and other (1)Total cost of revenue 14,478 17,144 42,236 48,620

Gross profit 39,167 47,937 111,101 139,348

Operating expenses:Sales and marketing (1) 29,609 37,503 86,089 104,335

Research and development 16,504 21,984 49,874 57,511 (1)General and 11,929 13,430 31,355 36,032 administrative (1), (2)Total operating expenses 58,042 72,917 167,318 197,878

Loss from operations (18,875 ) (24,980 ) (56,217 ) (58,530 )

Other expense, net (1) (3,215 ) (3,471 ) (8,356 ) (10,238 )

Loss before income taxes (22,090 ) (28,451 ) (64,573 ) (68,768 )

Provision for income 131 62 446 89 taxesNet loss $ (22,221 ) $ (28,513 ) $ (65,019 ) $ (68,857 )

Net loss per share $ (0.75 ) $ (0.88 ) $ (2.24 ) $ (2.17 )(basic and diluted)Weighted-average number 29,533 32,363 28,998 31,758 of shares (basic anddiluted) (1) Includes stock-basedcompensation expenses,as follows:Cost of revenue:Subscription $ 377 $ 800 $ 750 $ 1,768

Professional services 273 563 494 1,168 and otherSales and marketing 3,301 6,718 7,670 15,192

Research and development 2,716 5,363 6,595 10,603

General and 3,452 4,543 8,172 11,596 administrativeOther expense, net 172 176 267 524

Total stock-based $ 10,291 $ 18,163 $ 23,948 $ 40,851 compensation expenses (2) Includesamortization of certainintangible assets, asfollows:General and $ 20 $ 20 $ 60 $ 60 administrativeDomo, Inc.Condensed Consolidated Balance Sheets(in thousands)(unaudited)January 31,October 31,2021

2021

AssetsCurrent assets:Cash and cash equivalents$

90,794

$

84,245

Accounts receivable, net48,272

38,895

Contract acquisition costs13,894

13,795

Prepaid expenses and other current assets12,216

7,314

Total current assets165,176

144,249

Property and equipment, net14,745

16,998

Right-of-use assets3,663

17,738

Contract acquisition costs, noncurrent18,605

18,474

Intangible assets, net3,356

2,895

Goodwill9,478

9,478

Other assets1,415

1,301

Total assets$

216,438

$

211,133

Liabilities and stockholders' deficitCurrent liabilities:Accounts payable$

1,085

$

12,021

Accrued expenses and other current liabilities51,950

44,903

Lease liabilities3,808

3,117

Current portion of deferred revenue129,079

130,385

Total current liabilities185,922

190,426

Lease liabilities, noncurrent1,556

17,565

Deferred revenue, noncurrent3,173

2,352

Other liabilities, noncurrent9,637

10,495

Long-term debt99,609

102,852

Total liabilities299,897

323,690

Commitments and contingenciesStockholders' deficit:Common stock30

32

Additional paid-in capital1,038,006

1,077,993

Accumulated other comprehensive income877

647

Accumulated deficit(1,122,372

)

(1,191,229

)

Total stockholders' deficit(83,459

)

(112,557

)

Total liabilities and stockholders' deficit$

216,438

$

211,133

Domo, Inc.Condensed Consolidated Balance Sheets(in thousands)(unaudited) January 31, October 31, 2021 2021

AssetsCurrent assets:Cash and cash equivalents $ 90,794 $ 84,245

Accounts receivable, net 48,272 38,895

Contract acquisition costs 13,894 13,795

Prepaid expenses and other current assets 12,216 7,314

Total current assets 165,176 144,249

Property and equipment, net 14,745 16,998

Right-of-use assets 3,663 17,738

Contract acquisition costs, noncurrent 18,605 18,474

Intangible assets, net 3,356 2,895

Goodwill 9,478 9,478

Other assets 1,415 1,301

Total assets $ 216,438 $ 211,133

Liabilities and stockholders' deficitCurrent liabilities:Accounts payable $ 1,085 $ 12,021

Accrued expenses and other current liabilities 51,950 44,903

Lease liabilities 3,808 3,117

Current portion of deferred revenue 129,079 130,385

Total current liabilities 185,922 190,426

Lease liabilities, noncurrent 1,556 17,565

Deferred revenue, noncurrent 3,173 2,352

Other liabilities, noncurrent 9,637 10,495

Long-term debt 99,609 102,852

Total liabilities 299,897 323,690

Commitments and contingencies Stockholders' deficit:Common stock 30 32

Additional paid-in capital 1,038,006 1,077,993

Accumulated other comprehensive income 877 647

Accumulated deficit (1,122,372 ) (1,191,229 )

Total stockholders' deficit (83,459 ) (112,557 )

Total liabilities and stockholders' deficit $ 216,438 $ 211,133

Domo, Inc.Condensed Consolidated Statements of Cash Flows(in thousands)(unaudited)Three Months EndedNine Months EndedOctober 31,October 31,2020

2021

2020

2021

Cash flows from operating activitiesNet loss$

(22,221

)

$

(28,513

)

$

(65,019

)

$

(68,857

)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:Depreciation and amortization1,126

1,533

3,490

3,789

Non-cash lease expense1,044

1,224

2,997

3,540

Amortization of contract acquisition costs3,657

3,944

10,577

11,779

Stock-based compensation10,291

18,163

23,948

40,851

Other, net1,634

877

3,456

2,663

Changes in operating assets and liabilities:Accounts receivable, net(2,855

)

(7,746

)

10,179

9,377

Contract acquisition costs(4,047

)

(4,354

)

(9,939

)

(11,719

)

Prepaid expenses and other assets474

664

4,039

4,949

Accounts payable2,991

4,652

2,397

10,965

Operating lease liabilities(996

)

(669

)

(2,564

)

(2,380

)

Accrued and other liabilities5,159

5,131

506

(5,972

)

Deferred revenue2,027

5,123

(3,487

)

485

Net cash (used in) provided by operating activities(1,716

)

29

(19,420

)

(530

)

Cash flows from investing activitiesPurchases of property and equipment(1,105

)

(1,547

)

(4,259

)

(4,965

)

Purchases of securities available for sale-

-

(11,149

)

-

Proceeds from maturities of securities available for sale4,900

-

29,200

-

Purchases of intangible assets(6

)

-

(111

)

-

Net cash provided by (used in) investing activities3,789

(1,547

)

13,681

(4,965

)

Cash flows from financing activitiesProceeds from shares issued in connection with employee stock purchase plan3,099

-

6,748

4,133

Shares repurchased for tax withholdings on vesting of restricted stock(194

)

(1,280

)

(717

)

(8,858

)

Proceeds from exercise of stock options446

745

2,505

3,908

Net cash provided by (used in) financing activities3,351

(535

)

8,536

(817

)

Effect of exchange rate changes on cash and cash equivalents(66

)

(75

)

173

(237

)

Net increase (decrease) in cash and cash equivalents5,358

(2,128

)

2,970

(6,549

)

Cash and cash equivalents at beginning of period78,455

86,373

80,843

90,794

Cash and cash equivalents at end of period$

83,813

$

84,245

$

83,813

$

84,245

Domo, Inc.Condensed Consolidated Statements of Cash Flows(in thousands)(unaudited) Three Months Ended Nine Months Ended October 31, October 31, 2020 2021 2020 2021

Cash flows fromoperating activitiesNet loss $ (22,221 ) $ (28,513 ) $ (65,019 ) $ (68,857 )

Adjustments to reconcilenet loss to net cash(used in) provided byoperating activities:Depreciation and 1,126 1,533 3,490 3,789 amortizationNon-cash lease expense 1,044 1,224 2,997 3,540

Amortization of contract 3,657 3,944 10,577 11,779 acquisition costsStock-based compensation 10,291 18,163 23,948 40,851

Other, net 1,634 877 3,456 2,663

Changes in operatingassets and liabilities:Accounts receivable, net (2,855 ) (7,746 ) 10,179 9,377

Contract acquisition (4,047 ) (4,354 ) (9,939 ) (11,719 )costsPrepaid expenses and 474 664 4,039 4,949 other assetsAccounts payable 2,991 4,652 2,397 10,965

Operating lease (996 ) (669 ) (2,564 ) (2,380 )liabilitiesAccrued and other 5,159 5,131 506 (5,972 )liabilitiesDeferred revenue 2,027 5,123 (3,487 ) 485

Net cash (used in) (1,716 ) 29 (19,420 ) (530 )provided by operatingactivities Cash flows frominvesting activitiesPurchases of property (1,105 ) (1,547 ) (4,259 ) (4,965 )and equipmentPurchases of securities - - (11,149 ) - available for saleProceeds from maturities 4,900 - 29,200 - of securities availablefor salePurchases of intangible (6 ) - (111 ) - assetsNet cash provided by 3,789 (1,547 ) 13,681 (4,965 )(used in) investingactivities Cash flows fromfinancing activitiesProceeds from sharesissued in connection 3,099 - 6,748 4,133 with employee stockpurchase planShares repurchased fortax withholdings on (194 ) (1,280 ) (717 ) (8,858 )vesting of restrictedstockProceeds from exercise 446 745 2,505 3,908 of stock optionsNet cash provided by 3,351 (535 ) 8,536 (817 )(used in) financingactivitiesEffect of exchange rate (66 ) (75 ) 173 (237 )changes on cash and cashequivalentsNet increase (decrease) 5,358 (2,128 ) 2,970 (6,549 )in cash and cashequivalentsCash and cash 78,455 86,373 80,843 90,794 equivalents at beginningof periodCash and cash $ 83,813 $ 84,245 $ 83,813 $ 84,245 equivalents at end ofperiodDomo, Inc.Reconciliation of Non-GAAP Financial Measures(in thousands, except per share data)(unaudited)Three Months EndedNine Months EndedOctober 31,October 31,2020

2021

2020

2021

Reconciliation of Subscription Gross Margin on a GAAP Basis to Subscription Gross Margin on a Non-GAAP Basis:Revenue:Subscription$

46,906

$

56,621

$

133,689

$

163,399

Cost of revenue:Subscription9,372

10,514

27,288

29,590

Subscription gross profit on a GAAP basis37,534

46,107

106,401

133,809

Subscription gross margin on a GAAP basis80

%

81

%

80

%

82

%

Stock-based compensation377

800

750

1,768

Subscription gross profit on a non-GAAP basis$

37,911

$

46,907

$

107,151

$

135,577

Subscription gross margin on a non-GAAP basis81

%

83

%

80

%

83

%

Reconciliation of Total Operating Expenses on a GAAP Basis to Total Operating Expenses on a Non-GAAP Basis:Total operating expenses on a GAAP basis$

58,042

$

72,917

$

167,318

$

197,878

Stock-based compensation(9,469

)

(16,624

)

(22,437

)

(37,391

)

Amortization of certain intangible assets(20

)

(20

)

(60

)

(60

)

Total operating expenses on a non-GAAP basis$

48,553

$

56,273

$

144,821

$

160,427

Reconciliation of Operating Loss on a GAAP Basis to Operating Loss on a Non-GAAP Basis:Operating loss on a GAAP basis$

(18,875

)

$

(24,980

)

$

(56,217

)

$

(58,530

)

Stock-based compensation10,119

17,987

23,681

40,327

Amortization of certain intangible assets20

20

60

60

Operating loss on a non-GAAP basis$

(8,736

)

$

(6,973

)

$

(32,476

)

$

(18,143

)

Reconciliation of Operating Margin on a GAAP Basis to Operating Margin on a Non-GAAP Basis:Operating margin on a GAAP basis(35

)%

(38

)%

(37

)%

(31

)%

Stock-based compensation19

27

16

21

Operating margin on a non-GAAP basis(16

)%

(11

)%

(21

)%

(10

)%

Reconciliation of Net Loss on a GAAP Basis to Net Loss on a Non-GAAP Basis:Net loss on a GAAP basis$

(22,221

)

$

(28,513

)

$

(65,019

)

$

(68,857

)

Stock-based compensation10,291

18,163

23,948

40,851

Amortization of certain intangible assets20

20

60

60

Net loss on a non-GAAP basis$

(11,910

)

$

(10,330

)

$

(41,011

)

$

(27,946

)

Reconciliation of Net Loss per Share on a GAAP Basis to Net Loss per Share on a Non-GAAP Basis:Net loss per share on a GAAP basis$

(0.75

)

$

(0.88

)

$

(2.24

)

$

(2.17

)

Stock-based compensation0.35

0.56

0.83

1.29

Net loss per share on a non-GAAP basis$

(0.40

)

$

(0.32

)

$

(1.41

)

$

(0.88

)

Billings:Total revenue$

53,645

$

65,081

$

153,337

$

187,968

Add:Deferred revenue (end of period)103,075

130,385

103,075

130,385

Deferred revenue, noncurrent (end of period)3,182

2,352

3,182

2,352

Less:Deferred revenue (beginning of period)(101,982

)

(126,381

)

(105,290

)

(129,079

)

Deferred revenue, noncurrent (beginning of period)(2,248

)

(1,233

)

(4,454

)

(3,173

)

Increase (decrease) in deferred revenue (current and noncurrent)2,027

5,123

(3,487

)

485

Billings$

55,672

$

70,204

$

149,850

$

188,453

Reconciliation of Net Cash (Used in) Provided by Operating Activities to Adjusted Net Cash Provided by (Used in) Operating Activities:Net cash (used in) provided by operating activities$

(1,716

)

$

29

$

(19,420

)

$

(530

)

Proceeds from shares issued in connection with employee stock purchase plan3,099

-

6,748

4,133

Adjusted net cash provided by (used in) operating activities$

1,383

$

29

$

(12,672

)

$

3,603

Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow:Net cash (used in) provided by operating activities$

(1,716

)

$

29

$

(19,420

)

$

(530

)

Proceeds from shares issued in connection with employee stock purchase plan3,099

-

6,748

4,133

Purchases of property and equipment(1,105

)

(1,547

)

(4,259

)

(4,965

)

Free cash flow$

278

$

(1,518

)

$

(16,931

)

$

(1,362

)

View source version on businesswire.com: https://www.businesswire.com/news/home/20211202005938/en/

CONTACT: Media - Julie Kehoe PR@domo.com

CONTACT: Investors - Peter Lowry IR@domo.com