- Total Customer Count Increased 22% Year-over-Year to Over 2,500
- First Quarter Revenue Increased 8% Year-over-Year to $92.0 Million
- Unearned Revenue Increased 22% Year-over-Year to $187 Million
- ARR Increased 14% Year-over-Year to $370 Million
- Cash and Cash Equivalents Increased to $272 Million
- Issues Guidance for Second Quarter Fiscal 2022
- Raises Guidance for Full Year Fiscal 2022
NEW YORK, May 27, 2021 /PRNewswire/ — Yext, Inc. (NYSE: YEXT), today announced its results for the three months ended April 30, 2021, or the Company's first quarter of fiscal 2022.
"We are kicking off this year with a very strong first quarter," said Howard Lerman, Founder and CEO of Yext. "We continue to grow revenue while increasing our business efficiencies and cash position. We are now expanding our search platform to include support search, and have an incredible roadmap that will allow us to deliver AI search everywhere across the enterprise. Our team is energized, and we're in a great position as the world begins to reopen."
First Quarter Fiscal 2022 Highlights:
Revenue of $92.0 million, an 8% increase, compared to $85.4 million reported in the first quarter fiscal 2021.
Gross Profit of $70.1 million, a 9% increase, compared to $64.2 million reported in the first quarter fiscal 2021. Gross margin of 76.2%, compared to 75.2% reported in first quarter fiscal 2021.
Net Loss and Non-GAAP Net Loss:
- Net loss of $17.6 million, compared to the net loss of $29.2 million in the first quarter fiscal 2021.
- Non-GAAP net loss of $3.0 million, compared to the non-GAAP net loss of $11.9 million in the first quarter fiscal 2021.
Net Loss Per Share and Non-GAAP Net Loss Per Share:
- Net loss per share of $0.14 in the first quarter fiscal 2022, compared to net loss per share of $0.25 in the first quarter fiscal 2021.
- Non-GAAP net loss per share of $0.02 in the first quarter fiscal 2022, compared to non-GAAP net loss per share of $0.10 in the first quarter fiscal 2021, each on a basic and diluted basis.
- Net loss per share and non-GAAP net loss per share were based on 125.4 million and 116.6 million weighted-average basic and diluted shares outstanding for the first quarter fiscal 2022 and fiscal 2021, respectively.
Balance Sheet: Cash and cash equivalents of $272 million as of April 30, 2021. Unearned revenue of $187 million as of April 30, 2021, compared to $153 million as of April 30, 2020.
Remaining Performance Obligations ("RPO"): RPO of $361 million as of April 30, 2021. RPO expected to be recognized over the next 24 months of $341 million with the remaining balance expected to be recognized thereafter. RPO does not include amounts under contract subject to certain accounting exclusions.
Cash Flow: Net cash provided by operating activities was $35.1 million for the three months ended April 30, 2021, compared to net cash used in operating activities of $0.7 million for the three months ended April 30, 2020.
Readers are encouraged to review the tables labeled "Reconciliation of GAAP to Non-GAAP Financial Measures" at the end of this release.
Recent Business Highlights:
- Launched Support Answers, a suite of enterprise search solutions built for customer support teams.
- Announced a joint digital event with Adobe to share best practices to optimize businesses websites to take place on June 16, 2021.
- Announced its inclusion in Forrester's "Now Tech: Cognitive Search, Q2 2021" research report.
- Announced general availability of Spring '21 Release highlighted by features such as extractive QA, a website crawler, and developer tools for Answers.
- Announced its designation as a leader on the Spring 2021 G2 Grid® from G2.com, Inc. and earned the top distinction in five categories.
- Announced its #Back2Biz campaign, which aims to put businesses at an advantage as COVID restrictions loosen and reopening ramps up.
- Customer count, which excludes our small business and third-party reseller customers, increased 22% year-over-year to over 2,500 as of April 30, 2021.
- Annual recurring revenue, or ARR, increased 14% year-over-year to $370 million as of April 30, 2021, compared to $326 million as of April 30, 2020.
Yext is also providing the following guidance for its second fiscal quarter ending July 31, 2021 and the fiscal year ending January 31, 2022.
Second Quarter Fiscal 2022 Outlook:
- Revenue is projected to be in the range of $94 million to $96 million.
- Non-GAAP net loss per share is projected to be $0.09 to $0.07 which assumes 127.0 million weighted-average basic shares outstanding.
Full Year Fiscal 2022 Outlook:
- Revenue is projected to be in the range of $381 million to $386 million.
- Non-GAAP net loss per share is projected to be $0.22 to $0.17 which assumes 128.2 million weighted-average basic shares outstanding.
Conference Call Information
Yext will host a conference call today at 4:30 P.M. Eastern Time (1:30 P.M. Pacific Time) to discuss its financial results with the investment community. A live webcast of the call will be available on the Yext Investor Relations website at http://investors.yext.com. A live dial-in is available domestically at (877) 883-0383 and internationally at (412) 902-6506, passcode 2319909.
A replay will be available domestically at (877) 344-7529 or internationally at (412) 317-0088, passcode 10156235, until midnight (ET) June 3, 2021.
Yext (NYSE: YEXT) is the AI Search Company and is on a mission to transform the enterprise with AI search. With the explosion of information and data online, search has never been more important. However, while the world of consumer search has innovated over time, enterprise search has not. In fact, the majority of enterprise search is powered by outdated keyword search technology that only scans for keywords and delivers a list of hyperlinks rather than actually answering questions.
Yext, the AI Search Company, offers a modern, AI-powered Answers Platform that understands natural language so that when people ask questions about a business online they get direct answers – not links. Brands like Verizon, Vanguard, Subway and Marriott — as well as organizations like the U.S. State Department and World Health Organization — trust Yext to radically improve their business with answers-led AI search.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This release includes forward-looking statements including, but not limited to, statements regarding our revenue, non-GAAP net loss and shares outstanding for our second quarter and full year fiscal 2022 in the paragraphs under "Financial Outlook" above, statements regarding the impact of the COVID-19 pandemic on our business and results of operations and other statements regarding our expectations regarding the growth of our company, our market opportunity, product roadmap, sales efficiency efforts and our industry. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expect," "plan," "anticipate," "believe," "estimate," "predict," "intend," "potential," "might," "would," "continue," or the negative of these terms or other comparable terminology. Actual events or results may differ from those expressed in these forward-looking statements, and these differences may be material and adverse.
We have based the forward-looking statements contained in this release primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, strategy, short- and long-term business operations, prospects, business strategy and financial needs. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including, but not limited to, the impact of the COVID-19 pandemic on U.S. and global markets, our business, operations, financial results, cash flow, demand for our products, sales cycles, and customer acquisition and retention; our ability to renew and expand subscriptions with existing customers especially enterprise customers and attract new customers generally; our ability to successfully expand and compete in new geographies and industry verticals; our ability to expand and scale our sales force; our ability to expand our service and application provider network; our ability to develop new product and platform offerings to expand our market opportunity, including with Yext Answers; our ability to release new products and updates that are adopted by our customers; our ability to manage our growth effectively; weakened or changing global economic conditions; the number of options exercised by our employees and former employees; and the accuracy of the assumptions and estimates underlying our financial projections. For a detailed discussion of these and other risk factors, please refer to the risks detailed in our filings with the Securities and Exchange Commission, including, without limitation, our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K, which are available at http://investors.yext.com and on the SEC's website at https://www.sec.gov. Further information on potential risks that could affect actual results will be included in other filings we make with the SEC from time to time. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this release. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.
The forward-looking statements made in this release relate only to events as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements after the date hereof or to conform such statements to actual results or revised expectations, except as required by law.
In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables include non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (sales and marketing, research and development, general and administrative), non-GAAP operating expenses (sales and marketing, research and development, general and administrative) as a percentage of revenue, non-GAAP loss from operations, non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, non-GAAP net income (loss) as a percentage of revenue, which are referred to as non-GAAP financial measures.
These non-GAAP financial measures are not calculated in accordance with GAAP as they have been adjusted to exclude the effects of stock-based compensation expenses. Non-GAAP gross margin, non-GAAP operating expenses (sales and marketing, research and development, general and administrative) as a percentage of revenue, non-GAAP operating margin, and non-GAAP net income (loss) as a percentage of revenue are calculated by dividing the applicable non-GAAP financial measure by revenue. Non-GAAP net income (loss) per share is defined as non-GAAP net income (loss) on a per share basis. See "Reconciliation of GAAP to Non-GAAP Financial Measures" for a discussion of the applicable weighted-average shares outstanding.
We believe these non-GAAP financial measures provide investors and other users of our financial information consistency and comparability with our past financial performance and facilitate period-to-period comparisons of our results of operations. With respect to non-GAAP gross margin, non-GAAP operating expenses (sales and marketing, research and development, general and administrative) as a percentage of revenue, non-GAAP operating margin and non-GAAP net loss as a percentage of revenue, we believe these non-GAAP financial measures are useful in evaluating our profitability relative to the amount of revenue generated, excluding the impact of stock-based compensation expense. We also believe non-GAAP financial measures are useful in evaluating our operating performance compared to that of other companies in our industry, as these metrics eliminate the effects of stock-based compensation, which may vary for reasons unrelated to overall operating performance.
We use these non-GAAP financial measures in conjunction with traditional GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, and to evaluate the effectiveness of our business strategies. Our definition may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish this or similar metrics. Thus, our non-GAAP financial measures should be considered in addition to, not as a substitute for, nor superior to or in isolation from, measures prepared in accordance with GAAP.
These non-GAAP financial measures may be limited in their usefulness because they do not present the full economic effect of our use of stock-based compensation. We compensate for these limitations by providing investors and other users of our financial information a reconciliation of the non-GAAP financial measure to the most closely related GAAP financial measures. However, we have not reconciled the non-GAAP guidance measures disclosed under "Financial Outlook" to their corresponding GAAP measures because certain reconciling items such as stock-based compensation and the corresponding provision for income taxes depend on factors such as the stock price at the time of award of future grants and thus cannot be reasonably predicted. Accordingly, reconciliations to the non-GAAP guidance measures is not available without unreasonable effort. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view non-GAAP net loss and non-GAAP net loss per share in conjunction with net loss and net loss per share.
This press release also includes certain operating metrics that we believe are useful in providing additional information in assessing the overall performance of our business.
Customer count is defined as the total number of customers with contracts executed as of the last day of the reporting period and a unique administrative account identifier on the Yext platform. We believe that customer count provides insight into our ability to grow our enterprise and mid-market customer base. As such, customer count excludes third-party reseller customers and small businesses customers as well as customers only receiving free trials.
Annual recurring revenue, or ARR, is defined as the annualized recurring amount of all contracts executed as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription and excludes amounts related to overages above the contractual minimum commitment. Contracts include portions of professional services contracts that are recurring in nature. ARR is independent of historical revenue, unearned revenue, remaining performance obligations or any other GAAP financial measure over any period. It should be considered in addition to, not as a substitute for, nor superior to or in isolation from, these measures and other measures prepared in accordance with GAAP. We believe ARR provides insight into the performance of our recurring revenue business model while mitigating for fluctuations in billing and contract terms.
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