Brightcove Inc. (Nasdaq: BCOV), the world’s most trusted
streaming technology company, today announced financial results for
the first quarter ended March 31, 2024.
“We delivered strong first quarter results that were at or above
the high-end of our guidance ranges, highlighted by our second
straight quarter of revenue growth, our third consecutive quarter
of double-digit adjusted EBITDA margins, and an increase in our
cash balance of over $4 million. We also improved the long-term
stability of our business with more longer-term deals, record
backlog and record average revenue per customer. Our focus remains
on returning the company to more consistent revenue growth while
continuing to deliver meaningful EBITDA and cash flow,” said Marc
DeBevoise, Brightcove’s Chief Executive Officer.
First Quarter 2024 Financial Highlights:
- Revenue for the first quarter of 2024 was $50.5 million,
an increase of 3% compared to $49.1 million for the first quarter
of 2023. Subscription and support revenue was $48.0 million, an
increase of 2% compared to the first quarter of 2023.
- Gross profit for the first quarter of 2024 was $30.9
million, representing a gross margin of 61%, compared to gross
profit of $28.8 million, representing a gross margin of 59% for the
first quarter of 2023. Non-GAAP gross profit for the first quarter
of 2024 was $31.7 million, representing a non-GAAP gross margin of
63%, compared to non-GAAP gross profit of $29.6 million,
representing a non-GAAP gross margin of 60% for the first quarter
of 2023. Non-GAAP gross profit and non-GAAP gross margin exclude
stock-based compensation expense, the amortization of acquired
intangible assets and restructuring and other expenses.
- Income (loss) from operations was $2.0 million for the
first quarter of 2024, compared to ($10.7) million for the first
quarter of 2023. Non-GAAP operating income, which excludes
stock-based compensation expense, the amortization of acquired
intangible assets, merger-related expenses, restructuring and other
expenses, and gain on sale of assets, was $984,000 for the first
quarter of 2024, compared to ($5.6) million during the first
quarter of 2023.
- Net income (loss) was $1.6 million, or $0.04 per diluted
share, for the first quarter of 2024. This compares to ($11.7)
million, or ($0.28) per diluted share, for the first quarter of
2023. Non-GAAP net income, which excludes stock-based compensation
expense, the amortization of acquired intangible assets,
merger-related expenses, restructuring and other expenses, and gain
on sale of assets, was $546,000 for the first quarter of 2024, or
$0.01 per diluted share, compared to ($6.6) million for the first
quarter of 2023, or ($0.15) per diluted share.
- Adjusted EBITDA was $5.0 million for the first quarter
of 2024, representing an adjusted EBITDA margin of 10% compared to
adjusted EBITDA of negative $2.7 million for the first quarter of
2023. Adjusted EBITDA excludes stock-based compensation expense,
merger-related expenses, restructuring and other expenses, gain on
sales of assets, the amortization of acquired intangible assets,
depreciation expense, other income/expense and the provision for
income taxes.
- Cash flow provided by operations was $2.0 million for
the first quarter of 2024, compared to cash flow used by operations
of $12.6 million for the first quarter of 2023.
- Free cash flow was negative $1.0 million after the
company invested $3.0 million in capital expenditures and
capitalization of internal-use software during the first quarter of
2024. Free cash flow was negative $17.5 million for the first
quarter of 2023.
- Cash and cash equivalents were $22.9 million as of March
31, 2024 compared to $18.6 million on December 31, 2023.
A Reconciliation of GAAP to Non-GAAP results has been provided
in the financial statement tables included at the end of this press
release. An explanation of these measures is also included below
under the heading “Non-GAAP Financial Measures.”
Other First Quarter and Recent Highlights/Updates:
- Announced the hiring of John Wagner as the Chief Financial
Officer (CFO). Mr. Wagner brings more than two decades of strategic
and operational financial leadership experience within the
technology industry. He brings extensive experience managing and
scaling financial operations to support growth and profitability in
addition to public and private capital raising and acquisitions.
Most recently, Wagner served for nine years as the CFO of
EverQuote, an online insurance marketplace, where he oversaw the
company's successful initial public offering (IPO) and led the
finance organization for five years post-IPO. He’s also held senior
executive financial roles at various software companies, including
Carbonite, Constant Contact, NuoDB, and Salesnet.
- Successfully monetized a portion of Brightcove’s patent
portfolio for $6 million. This strategic and value-enhancing
transaction increased the amount of cash on the Company’s balance
sheet by more than 30% while maintaining on a perpetual basis the
ability to use the technology covered by the patents in
Brightcove’s products for current and future customers.
- Signed new, renewed or expanded the relationship with a diverse
set of notable customers in the first quarter. This includes media
companies such as Acun Media, Watch It, and Red Venure’s CNET Media
Group, sports organizations like Ironman, Netball Australia, and
Little League Baseball and hundreds more across the technology,
healthcare/pharma and finance verticals.
- Entered into a strategic partnership with Google Ad Manager to
enhance its Ad Monetization service. This collaboration expands
Brightcove’s offering by supporting current and future customers
that leverage Google Ad Manager’s comprehensive digital advertising
sales platform for their digital ad operations.
- Launched “Publisher Insights”, a new capability within the
Media Studio Premium solution. Publisher Insights builds on
Brightcove’s Audience Insights to provide real-time analytics
specifically for news organizations and other content providers
focused on real-time-driven content. The product enables news
organizations to quickly identify stories that drive viewer
interest and help shape effective audience engagement
strategies.
- Launched Cloud Playout 2.0, which enhances media companies’
ability to create, distribute, and monetize channels. Building upon
the initial success of Cloud Playout, version 2.0 enables customers
to extend their reach, streamline workflows, and optimize content
with first-party data and analytics.
- Added new cloud-based video editing capabilities to our
streaming technology platform. The new core functionality, which is
included in the Marketing and Communications Studios, significantly
simplifies content creation, including repurposing existing video
content into “snackable” highlights for specific audiences, making
it simple to package employee-generated content and develop
promotional video content for promotions and sales campaigns.
- 12-month Backlog (which we define as the aggregate amount of
committed subscription revenue related to future performance
obligations in the next 12 months) was $127.3 million, a 2%
decrease year-over-year from $129.3 million at the end of the first
quarter 2023. Total backlog hit an all-time record of $185.4
million, a 2% increase year-over-year from $181.3 million at the
end of the first quarter 2023.
- Average annual subscription revenue per premium customer hit an
all-time record of $98,000 in the first quarter of 2024, excluding
starter edition customers who had average annualized revenue of
$4,300 per customer. The average annual subscription revenue per
premium customer increased 10% year-over-year compared to $89,400
in the first quarter of 2023.
- Ended the first quarter of 2024 with 2,502 customers, of which
1,992 were premium.
Business Outlook:
Based on information as of today, May 8, 2024, the Company is
issuing the following business updates and financial guidance.
Second Quarter 2024 Guidance:
- Revenue is expected to be in the range of $47.5 million
to $48.5 million, including approximately $1.8 million of
professional services revenue and $0.8 million of overages.
- Non-GAAP income (loss) from operations is expected to be
in the range of ($2.0) million to ($1.0) million, which excludes
stock-based compensation of approximately $2.8 million,
restructuring and other expenses of $0.7 million and the
amortization of acquired intangible assets of approximately $0.9
million.
- Adjusted EBITDA is expected to be in the range of $2.0
million to $3.0 million, which excludes stock-based compensation of
approximately $2.8 million, restructuring and other expenses of
$0.7 million, the amortization of acquired intangible assets of
approximately $0.9 million, depreciation expense of approximately
$4.3 million, and other (income) expense and the provision for
income taxes of approximately $0.3 million.
- Non-GAAP net loss per diluted share is expected to be
($0.05) to ($0.03), which excludes stock-based compensation of
approximately $2.8 million, restructuring and other expenses of
$0.7 million, the amortization of acquired intangible assets of
approximately $0.9 million, and assumes approximately 44.7 million
weighted-average shares outstanding.
Full Year 2024 Guidance:
- Revenue is expected to be in the range of $195.0 million
to $198.0 million, including approximately $8.0 million of
professional services revenue and approximately $3.5 million of
overages.
- Non-GAAP income (loss) from operations is expected to be
in the range of ($3.0) million to ($1.0) million, which excludes
stock-based compensation of approximately $10.7 million, the
amortization of acquired intangible assets of approximately $3.7
million, restructuring and other expenses of $2.5 million, and gain
on sale of assets of $6.0 million.
- Adjusted EBITDA is expected to be in the range of $14.0
million to $16.0 million, which excludes stock-based compensation
of approximately $10.7 million, the amortization of acquired
intangible assets of approximately $3.7 million, restructuring and
other expenses of $2.5 million, gain on the sale of patents of $6.0
million, depreciation expense of approximately $16.7 million, and
other (income) expense and the provision for income taxes of
approximately $1.4 million.
- Non-GAAP income (loss) per diluted share is expected to
be ($0.10) to ($0.05), which excludes stock-based compensation of
approximately $10.7 million, the amortization of acquired
intangible assets of approximately $3.7 million, restructuring and
other expenses of $2.5 million, gain on sale of assets of $6.0
million, and assumes approximately 44.6 million weighted-average
shares outstanding.
Earnings Stream Information:
Brightcove earnings will be streamed on May 8, 2024, at 5:00
p.m. (Eastern Time) to discuss the Company's financial results and
current business outlook. To access the live stream, visit the
“Investors” page of the Company’s website,
http://investor.brightcove.com. Once the live stream concludes, an
on-demand recording will be available on Brightcove’s Investor page
for a limited time at http://investor.brightcove.com.
About Brightcove Inc. (NASDAQ: BCOV)
Brightcove creates the world’s most reliable, scalable, and
secure streaming technology solutions to build a greater connection
between companies and their audiences, no matter where they are or
on which devices they consume content. In more than 60 countries,
Brightcove’s intelligent video platform enables businesses to sell
to customers more effectively, media leaders to stream and monetize
content more reliably, and every organization to communicate with
team members more powerfully. With two Technology and Engineering
Emmy® Awards for innovation, uptime that consistently leads the
industry, and unmatched scalability, we continuously push the
boundaries of what video can do. Follow Brightcove on LinkedIn, X,
Facebook, Instagram, Threads, and YouTube. Visit
Brightcove.com.
Forward-Looking Statements
This press release includes certain “forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements concerning our financial guidance for
the second fiscal quarter and full year 2024, our position to
execute on our growth strategy, the effects of our restructuring
efforts, the long-term stability of our business, and our ability
to expand our leadership position and market opportunity. These
forward-looking statements include, but are not limited to, plans,
objectives, expectations and intentions and other statements
contained in this press release that are not historical facts and
statements identified by words such as "expects," "anticipates,"
"intends," "plans," "believes," "seeks," "estimates" or words of
similar meaning. These forward-looking statements reflect our
current views about our plans, intentions, expectations, strategies
and prospects, which are based on the information currently
available to us and on assumptions we have made. Although we
believe that our plans, intentions, expectations, strategies and
prospects as reflected in or suggested by those forward-looking
statements are reasonable, we can give no assurance that the plans,
intentions, expectations or strategies will be attained or
achieved. Furthermore, actual results may differ materially from
those described in the forward-looking statements and will be
affected by a variety of risks and factors that are beyond our
control including, without limitation: the effect of macro-economic
conditions currently affecting the global economy; our ability to
retain existing customers and acquire new ones; our history of
losses; expectations regarding the widespread adoption of customer
demand for our products; the effects of increased competition and
commoditization of services we offer, including data delivery and
storage; keeping up with the rapid technological change required to
remain competitive in our industry; our ability to manage our
growth effectively and successfully recruit additional
highly-qualified personnel; our restructuring efforts, including
risks that the related costs and charges may be greater than
anticipated and that the restructuring efforts may not generate
their intended benefits, may adversely affect the Company’s
internal programs and the Company’s ability to recruit and train
skilled and motivated personnel, and may be distracting to
employees and management; the price volatility of our common stock;
and other risks set forth under the caption "Risk Factors" in our
most recently filed Annual Report on Form 10-K and similar
disclosures in our subsequent filings with the SEC. We assume no
obligation to update any forward-looking statements contained in
this document as a result of new information, future events or
otherwise.
Non-GAAP Financial Measures
Brightcove has provided in this release the non-GAAP financial
measures of non-GAAP gross profit, non-GAAP gross margin, non-GAAP
income (loss) from operations, non-GAAP net income (loss), adjusted
EBITDA, non-GAAP diluted net income (loss) per share, and revenue
and adjusted EBITDA on a constant currency basis. Brightcove uses
these non-GAAP financial measures internally in analyzing its
financial results and believes they are useful to investors, as a
supplement to GAAP measures, in evaluating Brightcove's ongoing
operational performance. Brightcove believes that the use of these
non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing its financial results with other companies in
Brightcove’s industry, many of which present similar non-GAAP
financial measures to investors. As noted, the non-GAAP financial
results discussed above of non-GAAP gross profit, non-GAAP gross
margin, non-GAAP income (loss) from operations, non-GAAP net income
(loss) and non-GAAP diluted net income (loss) per share exclude
stock-based compensation expense, amortization of acquired
intangible assets, merger-related expenses, gain on sales of
assets, restructuring and other (benefit) expense. The non-GAAP
financial results discussed above of adjusted EBITDA is defined as
consolidated net income (loss), plus other income/expense,
including interest expense and interest income, the provision for
income taxes, depreciation expense, the amortization of acquired
intangible assets, stock-based compensation expense, merger-related
expenses, gain on sales of assets, restructuring and other
(benefit) expense. Merger-related expenses include fees incurred in
connection with an acquisition and restructuring expenses include
primarily cash severance costs. Revenue and adjusted EBITDA on a
constant currency basis reflect our revenues and adjusted EBITDA
using exchange rates used for Brightcove’s Fiscal Year 2024 outlook
on Brightcove’s press release on February 22, 2024. Non-GAAP
financial measures have limitations as an analytical tool and
should not be considered in isolation from, or as a substitute for,
financial information prepared in accordance with GAAP. Investors
are encouraged to review the reconciliation of these non-GAAP
measures to their most directly comparable GAAP financial measures.
As previously mentioned, a reconciliation of our non-GAAP financial
measures to their most directly comparable GAAP measures has been
provided in the financial statement tables included below in this
press release. The Company’s earnings press releases containing
such non-GAAP reconciliations can be found on the Investors section
of the Company’s web site at http://www.brightcove.com.
Brightcove Inc. Condensed Consolidated Balance Sheets
(in thousands) March 31, 2024 December 31,
2023 Assets Current assets: Cash and cash equivalents
$
22,869
$
18,615
Accounts receivable, net of allowance
35,222
33,451
Prepaid expenses and other current assets
20,264
18,333
Total current assets
78,355
70,399
Property and equipment, net
41,007
42,476
Operating lease right-of-use asset
15,483
16,233
Intangible assets, net
5,446
6,368
Goodwill
74,859
74,859
Other assets
5,307
5,772
Total assets
$
220,457
$
216,107
Liabilities and stockholders' equity Current liabilities:
Accounts payable
$
11,386
$
14,422
Accrued expenses
18,847
17,566
Operating lease liability
4,218
4,486
Deferred revenue
71,843
68,155
Total current liabilities
106,294
104,629
Operating lease liability, net of current portion
16,745
17,358
Other liabilities
154
207
Total liabilities
123,193
122,194
Stockholders' equity: Common stock
45
44
Additional paid-in capital
331,001
328,918
Treasury stock, at cost
(871
)
(871
)
Accumulated other comprehensive loss
(1,543
)
(1,236
)
Accumulated deficit
(231,368
)
(232,942
)
Total stockholders’ equity
97,264
93,913
Total liabilities and stockholders' equity
$
220,457
$
216,107
Brightcove Inc. Condensed Consolidated Statements of
Operations (in thousands, except per share amounts)
Three Months Ended March 31,
2024
2023
Revenue: Subscription and support revenue
$
47,969
$
47,102
Professional services and other revenue
2,512
1,961
Total revenue
50,481
49,063
Cost of revenue: (1) (2) Cost of subscription and support revenue
16,807
18,265
Cost of professional services and other revenue
2,815
2,002
Total cost of revenue
19,622
20,267
Gross profit
30,859
28,796
Operating expenses: (1) (2) Research and development
8,849
9,866
Sales and marketing
16,454
19,465
General and administrative
9,544
10,064
Merger-related
-
145
Gain on sale of assets
(6,000
)
-
Total operating expenses
28,847
39,540
Income (loss) from operations
2,012
(10,744
)
Other expense, net
(38
)
(543
)
Income (loss) before income taxes
1,974
(11,287
)
Provision for income taxes
400
427
Net income (loss)
$
1,574
$
(11,714
)
Net income (loss) per share—basic and diluted Basic
$
0.04
$
(0.28
)
Diluted
0.04
(0.28
)
Weighted-average shares—basic and diluted Basic
43,983
42,528
Diluted
44,098
42,528
(1) Stock-based compensation included in above line items:
Cost of subscription and support revenue
$
106
$
138
Cost of professional services and other revenue
40
100
Research and development
315
688
Sales and marketing
354
1,169
General and administrative
1,398
1,448
(2) Amortization of acquired intangible assets included in
the above line items: Cost of subscription and support revenue
$
520
$
601
Sales and marketing
402
416
Brightcove Inc. Condensed Consolidated Statements of Cash
Flows (in thousands) Three Months Ended March
31, Operating activities
2024
2023
Net income (loss)
$
1,574
$
(11,714
)
Adjustments to reconcile net income (loss) to net cash used in
operating activities: Depreciation and amortization
4,917
3,949
Stock-based compensation
2,213
3,543
Provision for reserves on accounts receivable
(81
)
67
Gain on sale of assets
(6,000
)
-
Changes in assets and liabilities: Accounts receivable
(1,800
)
(14,713
)
Prepaid expenses and other current assets
(898
)
(986
)
Other assets
465
314
Accounts payable
(3,878
)
956
Accrued expenses
1,727
(3,999
)
Operating leases
(130
)
(81
)
Deferred revenue
3,918
10,032
Net cash provided by (used in) operating activities
2,027
(12,632
)
Investing activities Proceeds from sale of assets
6,000
-
Purchases of property and equipment, net of returns
(817
)
(952
)
Capitalization of internal-use software costs
(2,182
)
(3,930
)
Net cash provided by (used in) investing activities
3,001
(4,882
)
Financing activities Deferred acquisition payments
-
(1,700
)
Other financing activities
(239
)
(225
)
Net cash used in financing activities
(239
)
(1,925
)
Effect of exchange rate changes on cash and cash equivalents
(535
)
23
Net increase (decrease) in cash and cash equivalents
4,254
(19,416
)
Cash and cash equivalents at beginning of period
18,615
31,894
Cash and cash equivalents at end of period
$
22,869
$
12,478
Brightcove Inc. Reconciliation of GAAP Gross Profit, GAAP
Income (Loss) From Operations, GAAP Net Income (Loss) and GAAP Net
Income (Loss) Per Share to Non-GAAP Gross Profit, Non-GAAP
Income (Loss) From Operations, Non-GAAP Net Income(Loss) and
Non-GAAP Net Income (Loss) Per Share (in thousands, except
per share amounts) Three Months Ended March 31,
2024
2023
GROSS PROFIT: GAAP gross profit
$
30,859
$
28,796
Stock-based compensation expense
146
238
Amortization of acquired intangible assets
520
601
Restructuring and other
172
-
Non-GAAP gross profit
$
31,697
$
29,635
INCOME (LOSS) FROM OPERATIONS: GAAP income (loss) from operations
$
2,012
$
(10,744
)
Stock-based compensation expense
2,213
3,543
Amortization of acquired intangible assets
922
1,017
Merger-related
-
145
Restructuring and other
1,837
427
Gain on sale of assets
(6,000
)
-
Non-GAAP income (loss) from operations
$
984
$
(5,612
)
NET INCOME (LOSS) : GAAP net income (loss)
$
1,574
$
(11,714
)
Stock-based compensation expense
2,213
3,543
Amortization of acquired intangible assets
922
1,017
Merger-related
-
145
Restructuring and other
1,837
427
Gain on sale of assets
(6,000
)
-
Non-GAAP net income (loss)
$
546
$
(6,582
)
GAAP diluted net income (loss) per share
$
0.04
$
(0.28
)
Non-GAAP diluted net income (loss) per share
$
0.01
$
(0.15
)
Shares used in computing GAAP diluted net income (loss) per
share
44,098
42,528
Shares used in computing Non-GAAP diluted net income (loss) per
share
44,098
42,528
Brightcove Inc. Calculation of Adjusted EBITDA (in
thousands) Three Months Ended March 31,
2024
2023
Net income (loss)
$
1,574
$
(11,714
)
Other (income) expense, net
38
543
Provision for income taxes
400
427
Depreciation and amortization
4,917
3,949
Stock-based compensation expense
2,213
3,543
Merger-related
-
145
Restructuring and other
1,837
427
Gain on sale of assets
(6,000
)
-
Adjusted EBITDA
$
4,979
$
(2,680
)
Brightcove Inc. Reconciliation of Revenue on a Constant
Currency Basis and Calculation of Adjusted EBITDA on a Constant
Currency Basis (in thousands) Three Months
Ended March 31,
2024
Total revenue
$
50,481
Constant currency adjustment
220
Total revenue on a constant currency basis
$
50,701
Three Months Ended March 31,
2024
Adjusted EBITDA
$
4,979
Constant currency adjustment
100
Adjusted EBITDA on a constant currency basis
$
5,079
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240508734476/en/
Investors: ICR for Brightcove Brian Denyeau, 646-277-1251
brian.denyeau@icrinc.com or Media: Brightcove Sara Griggs,
929-888-4866 sgriggs@brightcove.com
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