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Procore Announces Second Quarter 2023 Financial Results

Procore Technologies, Inc. (NYSE: PCOR), a leading global provider of construction management software, today announced financial results for the second quarter ended June 30, 2023.

“I’m proud of the results we delivered this quarter as we continued to work toward our vision of improving the lives of everyone in construction,” said Tooey Courtemanche, founder, president and CEO of Procore. “We’re delivering solutions that help the construction industry find valuable efficiencies in an uncertain environment. I am excited to showcase what digital and cultural transformation means for the industry at large at Groundbreak 2023.”

“Although the demand environment remains challenging, we delivered solid results in the second quarter, highlighted by continued growth on the topline and improving operating leverage,” said Howard Fu, CFO of Procore. “Looking ahead, we remain focused on our pursuit of efficient growth and are on track to reach positive and sustainable free cash flow this year. We look forward to sharing more at our upcoming Investor Day.”

Second Quarter 2023 Financial Highlights:

  • Revenue was $229 million, an increase of 33% year-over-year.
  • GAAP gross margin was 81% and non-GAAP gross margin was 85%.
  • GAAP operating margin was (26%) and non-GAAP operating margin was (1%).
  • Operating cash outflow for the second quarter was $12 million.
  • Free cash outflow for the second quarter was $24 million.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

Recent Business Highlights:

  • Added 615 net new organic customers in the second quarter, ending with a total of 15,704 organic customers.
  • Achieved a gross revenue retention rate of 94% in the second quarter.
  • In the G2 2023 Summer Report, Procore maintained its #1 ranking across 11 categories, including construction project management, jobsite management, bid management, construction estimating, construction accounting, and more.
  • Announced partnership with The B1M, a leading construction video channel, to raise awareness about mental health in the construction industry through a global campaign, "Get Construction Talking."

Third Quarter and Full Year 2023 Outlook:

Procore is providing the following guidance for the third quarter and full year 2023:

  • Third Quarter 2023 Outlook:
    • Revenue is expected to be in the range of $232 million to $234 million, representing year-over-year growth of 24% to 26%.
    • Non-GAAP operating margin is expected to be in the range of (6%) to (5%).
  • Full Year 2023 Outlook:
    • Revenue is expected to be in the range of $921 million to $924 million, representing year-over-year growth of 28%.
    • Non-GAAP operating margin is expected to be in the range of (4.5%) to (4%).

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 of expenses that may be incurred in the future and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Procore’s future GAAP financial results.

Quarterly Conference Call

Procore Technologies, Inc. will hold a conference call to discuss its second quarter results at 2:00 p.m., Pacific Time, on Wednesday, August 2, 2023. A live audio webcast will be accessible on Procore's investor relations website at http://investors.procore.com.

September 20, 2023 Investor Day

Procore Technologies, Inc. will host its 2023 Investor Day on Wednesday, September 20, 2023 from 9:00 a.m. to 12:00 p.m., Central Time. The event will be held in-person in conjunction with Groundbreak 2023, Procore’s leading construction technology conference, taking place at the McCormick Place Conference Center in Chicago, Illinois.

A live webcast of the event will begin at 9:00 a.m., Central Time, on September 20, 2023. Interested parties can access the webcast by registering here. A replay of the webcast will also be made available on Procore's investor relations website at http://investors.procore.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, about Procore and its industry that involve substantial risks and uncertainties. All statements in this press release, other than statements of historical fact, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or future financial or operating performance, and may be identified by the use of words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would,” or the negative of these words, or other similar terms or expressions that concern Procore’s expectations, strategy, plans, or intentions.

Procore has based the forward-looking statements contained in this press release primarily on its current expectations and projections about future events and trends that Procore believes may affect its business, financial condition, and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors that could cause results to differ materially from Procore’s current expectations, including, but not limited to, our expectations regarding our financial performance (including revenues, expenses, and margins, and our ability to achieve or maintain future profitability), our ability to effectively manage our growth, anticipated performance, trends, growth rates, and challenges in our business and in the market in which we operate or anticipate entering into, economic and industry trends (in particular, the rate of adoption of construction management software and digitization of the construction industry, inflation, and challenging geopolitical conditions), our ability to attract new customers and retain and increase sales to existing customers, our ability to expand internationally, the effects of increased competition in our markets and our ability to compete effectively, our estimated total addressable market, and as set forth in Procore’s filings with the Securities and Exchange Commission. You should not place undue reliance on Procore’s forward-looking statements. Procore assumes no obligation to update any forward-looking statements to reflect events or circumstances that exist or change after the date on which they were made, except as required by law.

Non-GAAP Financial Measures

Procore believes that the use of certain non-GAAP financial measures as described below, when taken collectively, is helpful to investors because it provides consistency and comparability with past financial performance, and may assist in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results. These non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles, or GAAP.

Non-GAAP Gross Profit, Non-GAAP Gross Margin, Non-GAAP Operating Expenses, Non-GAAP Loss from Operations, Non-GAAP Operating Margin, Non-GAAP Net Income (Loss), and Non-GAAP Net Income (Loss) per Share: Procore defines these non-GAAP financial measures as the respective GAAP measures, excluding stock-based compensation expense, amortization of acquired intangible assets, employer payroll tax related to employee stock transactions, acquisition-related expenses, and the income tax effect of non-GAAP items. Non-GAAP gross margin is the ratio calculated by dividing non-GAAP gross profit by total revenue. Non-GAAP operating margin is the ratio calculated by dividing non-GAAP loss from operations by total revenue. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Non-GAAP diluted earnings per share is computed by giving effect to all potential weighted average dilutive common stock equivalents outstanding for the period, including options to purchase common stock, restricted stock units, and shares to be issued pursuant to the employee stock purchase plan. The dilutive effect of outstanding awards is reflected in non-GAAP diluted earnings per share by application of the treasury stock method.

Stock-based compensation expense includes the net effects of capitalization and amortization of stock-based compensation expense related to capitalized software and cloud-computing arrangement implementation costs. Stock-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of the compensation provided to our employees. Because of varying available valuation methodologies, subjective assumptions, and the variety of equity instruments that can impact a company’s non-cash expenses, we believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for meaningful comparisons between its operating results from period to period. The expense related to amortization of acquired intangible assets is dependent upon estimates and assumptions, which can vary significantly and are unique to each asset acquired; therefore, Procore believes non-GAAP measures that adjust for the amortization of acquired intangible assets provide investors a consistent basis for comparison across accounting periods. The amount of employer payroll tax-related items on employee stock transactions is dependent on restricted stock unit settlements, option exercises, related stock price, and other factors that are beyond Procore’s control and that do not correlate to the operation of the business. When evaluating the performance of its business and making operating plans, Procore does not consider these items (for example, when considering the impact of equity award grants, the company places a greater emphasis on overall stockholder dilution than the accounting charges associated with such grants). Additionally, acquisition-related expenses, such as transaction costs and retention payments, are expenses that are not necessarily reflective of operational performance during a period. Procore believes that the exclusion of acquisition-related expenses provides for a useful comparison of our operating results to prior periods and to its peer companies, which commonly exclude these expenses. Income tax benefits relate to the release of a portion of our valuation allowance as a result of deferred tax liabilities recorded related to available sources of income to realize our deferred tax assets. We exclude the income tax effect associated with certain of our non-GAAP financial measures because we believe that excluding this provides meaningful supplemental information regarding our operational performance. Overall, Procore believes it is useful to exclude these expenses in order to better understand the long-term performance of its core business and to facilitate comparison of its results period-over-period and to those of peer companies. All of these non-GAAP financial measures are important tools for financial and operational decision-making and for evaluating Procore's own operating results over different periods of time.

Non-GAAP financial measures may not provide information that is directly comparable to information provided by other companies in Procore's industry, as other companies in the industry may calculate non-GAAP financial measures differently. In addition, there are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies, and exclude expenses that may have a material impact on Procore's reported financial results. Further, stock-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in Procore's business and an important part of the compensation provided to its employees. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Investors should review the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate Procore's business.

Free Cash Flow: Procore defines free cash flow as net cash (used in) provided by operating activities, less purchases of property and equipment and capitalized software development costs. Procore believes free cash flow is an important liquidity measure of the cash (if any) that is available, after our operating activities and capital expenditures. Procore uses free cash flow in conjunction with traditional GAAP measures to assess its liquidity and evaluate the effectiveness of its business strategies. Once Procore’s business needs and obligations are met, cash can be used to maintain a strong balance sheet and invest in future growth.

Other Metrics

Customer Count: The aforementioned customer count excludes customers acquired from Levelset and Esticom that have not yet been renewed onto standard Procore annual contracts. Remaining Levelset and Esticom legacy customers will be included in our customer metrics once they are renewed onto standard Procore annual contracts or upon integration of the sales process.

About Procore

Procore Technologies, Inc. (NYSE: PCOR) creates software for people who build the world. With a focus on providing timely and accurate data for all, Procore transforms the construction industry one project at a time - from hospitals and skyscrapers to airports and stadiums. Beyond its connected, innovative technology, Procore empowers the industry and its communities through Procore.org. For more information, visit www.procore.com.

Procore Technologies, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands, except share and per share amounts)

Revenue

$

228,536

 

 

$

172,205

 

 

$

442,062

 

 

$

331,721

 

Cost of revenue(1)(2)(3)

 

42,304

 

 

 

36,735

 

 

 

82,506

 

 

 

70,067

 

Gross profit

 

186,232

 

 

 

135,470

 

 

 

359,556

 

 

 

261,654

 

Operating expenses

 

 

 

 

 

 

 

Sales and marketing(1)(2)(3)(4)

 

125,362

 

 

 

103,283

 

 

 

242,725

 

 

 

197,198

 

Research and development(1)(2)(3)(4)

 

73,216

 

 

 

63,822

 

 

 

153,252

 

 

 

124,076

 

General and administrative(1)(3)(4)

 

46,383

 

 

 

40,667

 

 

 

91,571

 

 

 

83,819

 

Total operating expenses

 

244,961

 

 

 

207,772

 

 

 

487,548

 

 

 

405,093

 

Loss from operations

 

(58,729

)

 

 

(72,302

)

 

 

(127,992

)

 

 

(143,439

)

Interest income

 

4,943

 

 

 

678

 

 

 

9,891

 

 

 

753

 

Interest expense

 

(491

)

 

 

(567

)

 

 

(987

)

 

 

(1,133

)

Accretion income, net

 

2,031

 

 

 

 

 

 

3,663

 

 

 

 

Other expense, net

 

(313

)

 

 

(890

)

 

 

(523

)

 

 

(347

)

Loss before provision for income taxes

 

(52,559

)

 

 

(73,081

)

 

 

(115,948

)

 

 

(144,166

)

Provision for income taxes

 

322

 

 

 

42

 

 

 

380

 

 

 

376

 

Net loss

$

(52,881

)

 

$

(73,123

)

 

$

(116,328

)

 

$

(144,542

)

Net loss per share attributable to common stockholders, basic and diluted

$

(0.37

)

 

$

(0.54

)

 

$

(0.83

)

 

$

(1.07

)

Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted

 

141,238,489

 

 

 

135,927,677

 

 

 

140,446,873

 

 

 

135,232,404

 

(1)

Includes stock-based compensation expense and amortization of capitalized stock-based compensation as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Cost of revenue

$

2,880

 

$

2,046

 

$

5,376

 

$

3,504

Sales and marketing

 

14,470

 

 

 

12,572

 

 

 

27,574

 

 

 

22,868

 

Research and development

 

16,270

 

 

 

13,144

 

 

 

36,051

 

 

 

26,152

 

General and administrative

 

9,909

 

 

 

6,133

 

 

 

20,384

 

 

 

18,580

 

Total stock-based compensation expense*

$

43,529

 

 

$

33,895

 

 

$

89,385

 

 

$

71,104

 

 

*Includes amortization of capitalized stock-based compensation of $1.0 million and $2.0 million, respectively, for the three and six months ended June 30, 2023 which was initially capitalized as capitalized software and cloud-computing arrangement implementation costs.

(2)

Includes amortization of acquired intangible assets as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Cost of revenue

$

5,493

 

$

5,654

 

$

10,986

 

$

11,308

Sales and marketing

 

3,106

 

 

 

3,106

 

 

 

6,213

 

 

 

6,212

 

Research and development

 

675

 

 

 

895

 

 

 

1,409

 

 

 

1,797

 

Total amortization of acquired intangible assets

$

9,274

 

 

$

9,655

 

 

$

18,608

 

 

$

19,317

 

(3)

Includes employer payroll tax on employee stock transactions as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Cost of revenue

$

139

 

$

68

 

$

306

 

$

149

Sales and marketing

 

618

 

 

 

317

 

 

 

1,617

 

 

 

925

 

Research and development

 

891

 

 

 

523

 

 

 

2,247

 

 

 

1,550

 

General and administrative

 

503

 

 

 

182

 

 

 

1,135

 

 

 

727

 

Total employer payroll tax on employee stock transactions

$

2,151

 

 

$

1,090

 

 

$

5,305

 

 

$

3,351

 

(4)

Includes acquisition-related expenses as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Sales and marketing

$

548

 

$

208

 

$

1,454

 

$

415

Research and development

 

204

 

 

 

1,090

 

 

 

6,188

 

 

 

2,191

 

General and administrative

 

 

 

 

1,081

 

 

 

 

 

 

2,119

 

Total acquisition-related expenses

$

752

 

 

$

2,379

 

 

$

7,642

 

 

$

4,725

 

Procore Technologies, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

 

 

June 30,

2023

 

December 31,

2022

 

(in thousands)

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

312,518

 

 

$

296,712

 

Marketable securities

 

290,445

 

 

 

285,493

 

Accounts receivable, net

 

125,577

 

 

 

148,683

 

Contract cost asset, current

 

25,655

 

 

 

23,600

 

Prepaid expenses and other current assets

 

43,711

 

 

 

44,731

 

Total current assets

 

797,906

 

 

 

799,219

 

Capitalized software development costs, net

 

70,397

 

 

 

58,577

 

Property and equipment, net

 

37,121

 

 

 

39,193

 

Right of use assets - finance leases

 

35,681

 

 

 

37,026

 

Right of use assets - operating leases

 

40,223

 

 

 

41,934

 

Contract cost asset, non-current

 

42,112

 

 

 

40,477

 

Intangible assets, net

 

144,517

 

 

 

162,953

 

Goodwill

 

539,355

 

 

 

539,128

 

Other assets

 

18,640

 

 

 

21,903

 

Total assets

$

1,725,952

 

 

$

1,740,410

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

$

15,539

 

 

$

14,282

 

Accrued expenses

 

60,090

 

 

 

99,182

 

Deferred revenue, current

 

416,788

 

 

 

396,535

 

Other current liabilities

 

27,468

 

 

 

21,639

 

Total current liabilities

 

519,885

 

 

 

531,638

 

Deferred revenue, non-current

 

5,145

 

 

 

5,278

 

Finance lease liabilities, non-current

 

44,574

 

 

 

45,578

 

Operating lease liabilities, non-current

 

35,630

 

 

 

38,087

 

Other liabilities, non-current

 

4,283

 

 

 

3,049

 

Total liabilities

 

609,517

 

 

 

623,630

 

Stockholders’ equity

 

 

 

Common stock

 

14

 

 

 

14

 

Additional paid-in capital

 

2,183,893

 

 

 

2,068,225

 

Accumulated other comprehensive loss

 

(2,001

)

 

 

(2,316

)

Accumulated deficit

 

(1,065,471

)

 

 

(949,143

)

Total stockholders’ equity

 

1,116,435

 

 

 

1,116,780

 

Total liabilities and stockholders’ equity

$

1,725,952

 

 

$

1,740,410

 

Remaining performance obligation:

 

The following table presents our current and non-current RPO at the end of each period:

 

 

June 30,

 

Change

 

2023

 

2022

 

Dollar

 

Percent

 

(dollars in thousands)

Remaining performance obligations

 

 

 

 

 

 

 

Current

$

622,639

 

$

469,341

 

$

153,298

 

33

%

Non-current

 

226,877

 

 

 

184,593

 

 

 

42,284

 

 

23

%

Total remaining performance obligations

$

849,516

 

 

$

653,934

 

 

$

195,582

 

 

30

%

Procore Technologies, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Operating activities

 

 

 

 

 

 

 

Net loss

$

(52,881

)

 

$

(73,123

)

 

$

(116,328

)

 

$

(144,542

)

Adjustments to reconcile net loss to net cash (used in) provided by operating activities

Stock-based compensation

 

42,487

 

 

 

33,895

 

 

 

87,425

 

 

 

71,104

 

Depreciation and amortization

 

17,336

 

 

 

15,403

 

 

 

34,210

 

 

 

30,550

 

Accretion of discounts on marketable debt securities, net

 

(2,030

)

 

 

 

 

 

(3,662

)

 

 

 

Abandonment of long-lived assets

 

94

 

 

 

887

 

 

 

535

 

 

 

887

 

Noncash operating lease expense

 

2,604

 

 

 

2,652

 

 

 

5,232

 

 

 

4,808

 

Unrealized foreign currency loss, net

 

149

 

 

 

832

 

 

 

557

 

 

 

355

 

Deferred income taxes

 

3

 

 

 

(286

)

 

 

5

 

 

 

(638

)

Provision for credit losses

 

2,004

 

 

 

740

 

 

 

3,730

 

 

 

642

 

Increase (decrease) in fair value of strategic investments

 

43

 

 

 

(81

)

 

 

6

 

 

 

(81

)

Changes in operating assets and liabilities

 

 

 

 

 

 

 

Accounts receivable

 

(19,371

)

 

 

(10,116

)

 

 

23,577

 

 

 

24,357

 

Deferred contract cost assets

 

(3,170

)

 

 

(3,295

)

 

 

(3,630

)

 

 

(7,361

)

Prepaid expenses and other assets

 

(2,847

)

 

 

59

 

 

 

1,701

 

 

 

(5,116

)

Accounts payable

 

(3,499

)

 

 

5,587

 

 

 

1,149

 

 

 

5,926

 

Accrued expenses and other liabilities

 

(2,929

)

 

 

(4,552

)

 

 

(31,110

)

 

 

(8,909

)

Deferred revenue

 

13,093

 

 

 

6,932

 

 

 

19,582

 

 

 

15,706

 

Operating lease liabilities

 

(2,760

)

 

 

(2,489

)

 

 

(5,381

)

 

 

(4,359

)

Net cash (used in) provided by operating activities

 

(11,674

)

 

 

(26,955

)

 

 

17,598

 

 

 

(16,671

)

Investing activities

 

 

 

 

 

 

 

Purchases of property and equipment

 

(2,521

)

 

 

(1,908

)

 

 

(4,694

)

 

 

(9,433

)

Capitalized software development costs

 

(9,400

)

 

 

(8,620

)

 

 

(17,351

)

 

 

(16,252

)

Purchases of strategic investments

 

(294

)

 

 

(689

)

 

 

(442

)

 

 

(3,018

)

Purchases of marketable securities

 

(139,286

)

 

 

 

 

 

(229,282

)

 

 

 

Maturities of marketable securities

 

118,817

 

 

 

 

 

 

222,726

 

 

 

 

Sales of marketable securities

 

5,452

 

 

 

 

 

 

5,452

 

 

 

 

Originations of materials financing

 

(7,931

)

 

 

(9,259

)

 

 

(17,007

)

 

 

(9,259

)

Customer repayments of materials financing

 

7,638

 

 

 

6,261

 

 

 

12,996

 

 

 

6,261

 

Settlement of post-close working capital adjustments from business combinations

 

 

 

 

 

 

 

 

 

 

1,291

 

Net cash used in investing activities

 

(27,525

)

 

 

(14,215

)

 

 

(27,602

)

 

 

(30,410

)

Financing activities

 

 

 

 

 

 

 

Proceeds from stock option exercises

 

7,217

 

 

 

7,697

 

 

 

10,939

 

 

 

14,604

 

Proceeds from employee stock purchase plan

 

13,006

 

 

 

11,513

 

 

 

13,006

 

 

 

11,513

 

Payments of deferred offering costs

 

 

 

 

(270

)

 

 

 

 

 

(270

)

Principal payments under finance lease agreements, net of proceeds from lease incentives

 

(520

)

 

 

(479

)

 

 

(930

)

 

 

(844

)

Net cash provided by financing activities

 

19,703

 

 

 

18,461

 

 

 

23,015

 

 

 

25,003

 

Net increase in cash, cash equivalents and restricted cash

 

(19,496

)

 

 

(22,709

)

 

 

13,011

 

 

 

(22,078

)

Effect of exchange rate changes on cash

 

(55

)

 

 

(981

)

 

 

(309

)

 

 

(806

)

Cash, cash equivalents and restricted cash, beginning of period

 

332,068

 

 

 

590,018

 

 

 

299,816

 

 

 

589,212

 

Cash, cash equivalents and restricted cash, end of period

$

312,517

 

 

$

566,328

 

 

$

312,518

 

 

$

566,328

 

Procore Technologies, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited)

 

Reconciliation of gross profit and gross margin to non-GAAP gross profit and non-GAAP gross margin:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(dollars in thousands)

Revenue

$

228,536

 

 

$

172,205

 

 

$

442,062

 

 

$

331,721

 

Gross profit

 

186,232

 

 

 

135,470

 

 

 

359,556

 

 

 

261,654

 

Stock-based compensation expense

 

2,880

 

 

 

2,046

 

 

 

5,376

 

 

 

3,504

 

Amortization of acquired technology intangible assets

 

5,493

 

 

 

5,654

 

 

 

10,986

 

 

 

11,308

 

Employer payroll tax on employee stock transactions

 

139

 

 

 

68

 

 

 

306

 

 

 

149

 

Non-GAAP gross profit

$

194,744

 

 

$

143,238

 

 

$

376,224

 

 

$

276,615

 

Gross margin

 

81

%

 

 

79

%

 

 

81

%

 

 

79

%

Non-GAAP gross margin

 

85

%

 

 

83

%

 

 

85

%

 

 

83

%

Reconciliation of operating expenses to non-GAAP operating expenses:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(dollars in thousands)

Revenue

$

228,536

 

 

$

172,205

 

 

$

442,062

 

 

$

331,721

 

GAAP sales and marketing

 

125,362

 

 

 

103,283

 

 

 

242,725

 

 

 

197,198

 

Stock-based compensation expense

 

(14,470

)

 

 

(12,572

)

 

 

(27,574

)

 

 

(22,868

)

Amortization of acquired intangible assets

 

(3,106

)

 

 

(3,106

)

 

 

(6,213

)

 

 

(6,212

)

Employer payroll tax on employee stock transactions

 

(618

)

 

 

(317

)

 

 

(1,617

)

 

 

(925

)

Acquisition-related expenses

 

(548

)

 

 

(208

)

 

 

(1,454

)

 

 

(415

)

Non-GAAP sales and marketing

$

106,620

 

 

$

87,080

 

 

$

205,867

 

 

$

166,778

 

GAAP sales and marketing as a percentage of revenue

 

55

%

 

 

60

%

 

 

55

%

 

 

59

%

Non-GAAP sales and marketing as a percentage of revenue

 

47

%

 

 

51

%

 

 

47

%

 

 

50

%

 

 

 

 

 

 

 

 

GAAP research and development

$

73,216

 

 

$

63,822

 

 

$

153,252

 

 

$

124,076

 

Stock-based compensation expense

 

(16,270

)

 

 

(13,144

)

 

 

(36,051

)

 

 

(26,152

)

Amortization of acquired intangible assets

 

(675

)

 

 

(895

)

 

 

(1,409

)

 

 

(1,797

)

Employer payroll tax on employee stock transactions

 

(891

)

 

 

(523

)

 

 

(2,247

)

 

 

(1,550

)

Acquisition-related expenses

 

(204

)

 

 

(1,090

)

 

 

(6,188

)

 

 

(2,191

)

Non-GAAP research and development

$

55,176

 

 

$

48,170

 

 

$

107,357

 

 

$

92,386

 

GAAP research and development as a percentage of revenue

 

32

%

 

 

37

%

 

 

35

%

 

 

37

%

Non-GAAP research and development as a percentage of revenue

 

24

%

 

 

28

%

 

 

24

%

 

 

28

%

 

 

 

 

 

 

 

 

GAAP general and administrative

$

46,383

 

 

$

40,667

 

 

$

91,571

 

 

$

83,819

 

Stock-based compensation expense

 

(9,909

)

 

 

(6,133

)

 

 

(20,384

)

 

 

(18,580

)

Employer payroll tax on employee stock transactions

 

(503

)

 

 

(182

)

 

 

(1,135

)

 

 

(727

)

Acquisition-related expenses

 

 

 

 

(1,081

)

 

 

 

 

 

(2,119

)

Non-GAAP general and administrative

$

35,971

 

 

$

33,271

 

 

$

70,052

 

 

$

62,393

 

GAAP general and administrative as a percentage of revenue

 

20

%

 

 

24

%

 

 

21

%

 

 

25

%

Non-GAAP general and administrative as a percentage of revenue

 

16

%

 

 

19

%

 

 

16

%

 

 

19

%

Reconciliation of loss from operations and operating margin to non-GAAP loss from operations and non-GAAP operating margin:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(dollars in thousands)

Revenue

$

228,536

 

 

$

172,205

 

 

$

442,062

 

 

$

331,721

 

Loss from operations

 

(58,729

)

 

 

(72,302

)

 

 

(127,992

)

 

 

(143,439

)

Stock-based compensation expense

 

43,529

 

 

 

33,895

 

 

 

89,385

 

 

 

71,104

 

Amortization of acquired intangible assets

 

9,274

 

 

 

9,655

 

 

 

18,608

 

 

 

19,317

 

Employer payroll tax on employee stock transactions

 

2,151

 

 

 

1,090

 

 

 

5,305

 

 

 

3,351

 

Acquisition-related expenses

 

752

 

 

 

2,379

 

 

 

7,642

 

 

 

4,725

 

Non-GAAP loss from operations

$

(3,023

)

 

$

(25,283

)

 

$

(7,052

)

 

$

(44,942

)

Operating margin

 

(26

%)

 

 

(42

%)

 

 

(29

%)

 

 

(43

%)

Non-GAAP operating margin

 

(1

%)

 

 

(15

%)

 

 

(2

%)

 

 

(14

%)

Reconciliation of net loss and net loss per share to non-GAAP net income (loss) and non-GAAP net income (loss) per share:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands, except share and per share amounts)

Revenue

$

228,536

 

 

$

172,205

 

 

$

442,062

 

 

$

331,721

 

Net loss

 

(52,881

)

 

 

(73,123

)

 

 

(116,328

)

 

 

(144,542

)

Stock-based compensation expense

 

43,529

 

 

 

33,895

 

 

 

89,385

 

 

 

71,104

 

Amortization of acquired intangible assets

 

9,274

 

 

 

9,655

 

 

 

18,608

 

 

 

19,317

 

Employer payroll tax on employee stock transactions

 

2,151

 

 

 

1,090

 

 

 

5,305

 

 

 

3,351

 

Acquisition-related expenses

 

752

 

 

 

2,379

 

 

 

7,642

 

 

 

4,725

 

Income tax effect of non-GAAP items

 

 

 

 

110

 

 

 

 

 

 

110

 

Non-GAAP net income (loss)

$

2,825

 

 

$

(25,994

)

 

$

4,612

 

 

$

(45,935

)

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

Non-GAAP net income (loss)

$

2,825

 

 

$

(25,994

)

 

$

4,612

 

 

$

(45,935

)

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

Weighted-average shares used in computing net loss per share attributable to common stockholders, basic

 

141,238,489

 

 

 

135,927,677

 

 

 

140,446,873

 

 

 

135,232,404

 

Effect of dilutive securities: Employee stock awards

 

6,117,368

 

 

 

 

 

 

6,537,556

 

 

 

 

Weighted-average shares used in computing net income per share attributable to common stockholders, diluted

 

147,355,857

 

 

 

135,927,677

 

 

 

146,984,429

 

 

 

135,232,404

 

 

 

 

 

 

 

 

 

GAAP net loss per share, basic

$

(0.37

)

 

$

(0.54

)

 

$

(0.83

)

 

$

(1.07

)

GAAP net loss per share, diluted

$

(0.37

)

 

$

(0.54

)

 

$

(0.83

)

 

$

(1.07

)

Non-GAAP net income (loss) per share, basic

$

0.02

 

 

$

(0.19

)

 

$

0.03

 

 

$

(0.34

)

Non-GAAP net income (loss) per share, diluted

$

0.02

 

 

$

(0.19

)

 

$

0.03

 

 

$

(0.34

)

Computation of free cash flow:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

 

(in thousands)

Net cash (used in) provided by operating activities

$

(11,674

)

 

$

(26,955

)

 

$

17,598

 

 

$

(16,671

)

Purchases of property, plant, and equipment

 

(2,521

)

 

 

(1,908

)

 

 

(4,694

)

 

 

(9,433

)

Capitalized software development costs

 

(9,400

)

 

 

(8,620

)

 

 

(17,351

)

 

 

(16,252

)

Non-GAAP free cash flow

$

(23,595

)

 

$

(37,483

)

 

$

(4,447

)

 

$

(42,356

)

PROCORE-IR

Category: Earnings

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