Washington | 001-38464 | 20-2954357 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
10500 NE 8th Street, Suite 1300 |
Bellevue, WA 98004 |
(Address of principal executive offices and zip code) |
(844) 324-2360 |
(Registrant’s telephone number, including area code) |
Exhibit No. | Description | ||
99.1 |
SMARTSHEET INC. | |||
By: | /s/ Jennifer E. Ceran | ||
Name: | Jennifer E. Ceran | ||
Title: | Chief Financial Officer & Treasurer | ||
Date: | March 19, 2019 |
• | Fourth quarter total revenue grew 58% year over year to $52.2 million |
• | Fourth quarter net operating cash flow was positive $4.0 million, net free cash flow was positive $1.0 million |
• | Full year total revenue grew 60% year over year to $177.7 million |
• | Full year net operating cash flow was negative $2.9 million, net free cash flow was negative $14.9 million |
• | Revenue: Total revenue was $52.2 million, an increase of 58% year over year. Subscription revenue was $46.5 million, an increase of 56% year over year. Professional services revenue was $5.7 million, an increase of 77% year over year. |
• | Operating Loss: GAAP operating loss was $12.7 million, or 24% of total revenue, compared to GAAP operating loss of $8.6 million, or 26% of total revenue, in the fourth quarter of fiscal 2018. Non-GAAP operating loss was $8.5 million, or 16% of total revenue, compared to non-GAAP operating loss of $7.5 million, or 23% of total revenue, in the fourth quarter of fiscal 2018. |
• | Net Loss: GAAP net loss was $11.7 million, compared to GAAP net loss of $8.7 million in the fourth quarter of fiscal 2018. GAAP net loss per share was $0.11, compared to GAAP net loss per share of $0.45 in the fourth quarter of fiscal 2018. Non-GAAP net loss was $7.5 million, compared to non-GAAP net loss of $7.0 million in the fourth quarter of fiscal 2018. Non-GAAP net loss per share was $0.07, compared to non-GAAP net loss per share of $0.08 in the fourth quarter of fiscal 2018. |
• | Cash Flow: Net operating cash flow was positive $4.0 million, compared to net operating cash flow of negative $6.6 million in the fourth quarter of fiscal 2018. Net free cash flow was positive $1.0 million, compared to negative $10.0 million in the fourth quarter of fiscal 2018. |
• | Revenue: Total revenue was $177.7 million, an increase of 60% year over year. Subscription revenue was $157.5 million, an increase of 57% year over year. Professional services revenue was $20.2 million, an increase of 86% year over year. |
• | Operating Loss: GAAP operating loss was $55.1 million, or 31% of total revenue, compared to GAAP operating loss of $49.0 million, or 44% of total revenue, in fiscal 2018. Non-GAAP operating loss was $38.5 million, or 22% of total revenue, compared to non-GAAP operating loss of $30.3 million, or 27% of total revenue, in fiscal 2018. |
• | Net Loss: GAAP net loss attributable to common shareholders was $53.9 million, compared to $53.7 million in fiscal 2018. GAAP net loss per share was $0.65, compared to GAAP net loss per share of $2.94 in fiscal 2018. Non-GAAP net loss was $36.0 million, compared to non-GAAP net loss of $29.6 million in fiscal 2018. Non-GAAP net loss per share was $0.36, compared to non-GAAP net loss per share of $0.35 in fiscal 2018. |
• | Cash Flow: Net operating cash flow was negative $2.9 million, compared to net operating cash flow of negative $13.6 million in fiscal 2018. Net free cash flow was negative $14.9 million, compared to negative $25.3 million in fiscal 2018. |
• | Ended the year with 78,959 domain-based customers |
• | The number of all customers with annualized contract values (ACV) of $50,000 or more grew to 444, an increase of 135% year over year |
• | Average ACV per domain-based customer increased to $2,454, an increase of 50% year over year |
• | Dollar-based net retention rate was 134% |
• | Total revenue of $54.0 million to $55.0 million, representing year-over-year growth of 49% to 51% |
• | Non-GAAP operating loss of $20.0 million to $19.0 million |
• | Non-GAAP net loss per share of $0.19 to $0.18, assuming basic and diluted weighted average shares outstanding of approximately 105 million |
• | Net free cash flow burn of up to $14 million |
• | Total revenue of $253.0 million to $257.0 million, representing year-over-year growth of 42% to 45% |
• | Non-GAAP operating loss of $65.0 million to $60.0 million |
• | Non-GAAP net loss per share of $0.59 to $0.55, assuming basic and diluted weighted average shares outstanding of approximately 106 million |
• | Calculated billings of $305 million to $310 million, representing year-over-year growth of 41% to 43% |
• | Net free cash flow burn of up to $20 million |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenue | |||||||||||||||
Subscription | $ | 46,482 | $ | 29,756 | $ | 157,529 | $ | 100,368 | |||||||
Professional services | 5,669 | 3,207 | 20,193 | 10,885 | |||||||||||
Total revenue | 52,151 | 32,963 | 177,722 | 111,253 | |||||||||||
Cost of revenue | |||||||||||||||
Subscription | 5,600 | 3,308 | 19,297 | 13,008 | |||||||||||
Professional services | 4,067 | 2,837 | 14,552 | 8,674 | |||||||||||
Total cost of revenue | 9,667 | 6,145 | 33,849 | 21,682 | |||||||||||
Gross profit | 42,484 | 26,818 | 143,873 | 89,571 | |||||||||||
Operating expenses | |||||||||||||||
Research and development | 15,986 | 9,593 | 58,841 | 37,590 | |||||||||||
Sales and marketing | 29,344 | 20,084 | 106,067 | 72,925 | |||||||||||
General and administrative | 9,839 | 5,756 | 34,049 | 28,034 | |||||||||||
Total operating expenses | 55,169 | 35,433 | 198,957 | 138,549 | |||||||||||
Loss from operations | (12,685 | ) | (8,615 | ) | (55,084 | ) | (48,978 | ) | |||||||
Interest income (expense) and other, net | 1,183 | (406 | ) | 1,492 | (435 | ) | |||||||||
Net loss before income tax provision (benefit) | (11,502 | ) | (9,021 | ) | (53,592 | ) | (49,413 | ) | |||||||
Income tax provision (benefit) | 183 | (307 | ) | 293 | (307 | ) | |||||||||
Net loss | $ | (11,685 | ) | $ | (8,714 | ) | $ | (53,885 | ) | $ | (49,106 | ) | |||
Deemed dividend | — | — | — | (4,558 | ) | ||||||||||
Net loss attributable to common shareholders | $ | (11,685 | ) | $ | (8,714 | ) | $ | (53,885 | ) | $ | (53,664 | ) | |||
Net loss per share attributable to common shareholders, basic and diluted | $ | (0.11 | ) | $ | (0.45 | ) | $ | (0.65 | ) | $ | (2.94 | ) | |||
Weighted-average shares outstanding used to compute net loss per share attributable to common shareholders, basic and diluted | 104,140 | 19,443 | 83,141 | 18,273 |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Cost of subscription revenue | $ | 132 | $ | 12 | $ | 346 | $ | 96 | |||||||
Cost of professional services revenue | 120 | 18 | 466 | 67 | |||||||||||
Research and development | 1,278 | 252 | 5,873 | 6,029 | |||||||||||
Sales and marketing | 1,306 | 329 | 5,163 | 1,707 | |||||||||||
General and administrative | 1,083 | 269 | 4,055 | 10,565 | |||||||||||
Total share-based compensation expense(1) | $ | 3,919 | $ | 880 | $ | 15,903 | $ | 18,464 |
(1) | Share-based compensation expense for the year ended January 31, 2018 includes share-based compensation expense related to the 2017 Tender Offer. |
January 31, | |||||||
2019 | 2018 | ||||||
Assets | (unaudited) | ||||||
Current assets | |||||||
Cash and cash equivalents | $ | 213,085 | $ | 58,158 | |||
Accounts receivable, net of allowances of $1,234 and $457, respectively | 30,173 | 14,870 | |||||
Prepaid expenses and other current assets | 3,922 | 4,628 | |||||
Total current assets | 247,180 | 77,656 | |||||
Long-term assets | |||||||
Restricted cash | 2,620 | 2,901 | |||||
Deferred commissions | 29,014 | 15,291 | |||||
Property and equipment, net | 22,540 | 17,237 | |||||
Intangible assets, net | 1,827 | 1,547 | |||||
Goodwill | 5,496 | 445 | |||||
Other long-term assets | 67 | 1,527 | |||||
Total assets | $ | 308,744 | $ | 116,604 | |||
Liabilities, convertible preferred stock, and shareholders’ equity (deficit) | |||||||
Current liabilities | |||||||
Accounts payable | $ | 4,658 | $ | 2,641 | |||
Accrued compensation and related benefits | 25,557 | 13,253 | |||||
Other accrued liabilities | 6,544 | 3,061 | |||||
Capital leases payable | 3,768 | 2,833 | |||||
Deferred revenue | 95,766 | 57,102 | |||||
Total current liabilities | 136,293 | 78,890 | |||||
Capital leases payable, non-current | 2,164 | 3,713 | |||||
Deferred revenue, non-current | 367 | 179 | |||||
Convertible preferred stock warrant liability | — | 1,272 | |||||
Other long-term liabilities | 2,928 | 604 | |||||
Total liabilities | 141,752 | 84,658 | |||||
Convertible preferred stock | |||||||
Convertible preferred stock, no par value; no shares authorized, issued, or outstanding as of January 31, 2019; 67,756,647 shares authorized, 67,619,377 shares issued and outstanding with aggregate liquidation preference of $113,217 as of January 31, 2018 | — | 112,687 | |||||
Shareholders’ equity (deficit): | |||||||
Preferred stock, no par value; 10,000,000 shares authorized, no shares issued or outstanding as of January 31, 2019; no shares authorized, issued, or outstanding as of January 31, 2018 | — | — | |||||
Common stock, no par value; no shares authorized, issued, or outstanding as of January 31, 2019; 107,679,381 shares authorized, 20,280,741 shares issued and outstanding as of January 31, 2018 | — | — |
Class A common stock, no par value; 500,000,000 shares authorized, 48,003,701 shares issued and outstanding as of January 31, 2019; no shares authorized, issued, or outstanding as of January 31, 2018 | — | — | |||||
Class B common stock, no par value; 500,000,000 shares authorized, 56,967,742 shares issued and outstanding as of January 31, 2019; no shares authorized, issued, or outstanding as of January 31, 2018 | — | — | |||||
Additional paid-in capital | 327,510 | 25,892 | |||||
Accumulated deficit | (160,518 | ) | (106,633 | ) | |||
Total shareholders’ equity (deficit) | 166,992 | (80,741 | ) | ||||
Total liabilities, convertible preferred stock, and shareholders’ equity (deficit) | $ | 308,744 | $ | 116,604 |
Year Ended January 31, | |||||||
2019 | 2018 | ||||||
Cash flows from operating activities | |||||||
Net loss | $ | (53,885 | ) | $ | (49,106 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Share-based compensation expense | 15,903 | 18,464 | |||||
Remeasurement of convertible preferred stock warrant liability | 1,326 | 795 | |||||
Depreciation of property and equipment | 7,194 | 4,019 | |||||
Amortization of deferred commissions | 10,770 | 4,989 | |||||
Unrealized foreign currency loss | 37 | — | |||||
Gain on disposal of assets | — | 2 | |||||
Amortization of intangible assets | 510 | 57 | |||||
Amortization of premiums, accretion of discounts and gain on investments | — | 26 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (15,265 | ) | (9,455 | ) | |||
Prepaid expenses and other current assets | 481 | (1,856 | ) | ||||
Other long-term assets | 207 | (1,022 | ) | ||||
Accounts payable | 2,031 | 704 | |||||
Other accrued liabilities | 3,424 | 2,014 | |||||
Accrued compensation and related benefits | 8,732 | 6,466 | |||||
Deferred commissions | (24,493 | ) | (14,704 | ) | |||
Other long-term liabilities | 1,322 | 457 | |||||
Deferred revenue | 38,851 | 24,569 | |||||
Net cash used in operating activities | (2,855 | ) | (13,581 | ) | |||
Cash flows from investing activities | |||||||
Purchases of property and equipment | (5,767 | ) | (6,006 | ) | |||
Capitalized internal-use software development costs | (3,017 | ) | (3,350 | ) | |||
Payments for business acquisition, net of cash acquired | (5,000 | ) | (1,464 | ) | |||
Proceeds from sales of investments | — | 900 | |||||
Proceeds from maturity of investments | — | 9,235 | |||||
Proceeds from sale of computer equipment | — | 1 | |||||
Purchases of intangible assets | — | (125 | ) | ||||
Net cash used in investing activities | (13,784 | ) | (809 | ) | |||
Cash flows from financing activities | |||||||
Proceeds from initial public offering, net of underwriters' discounts and commissions | 163,844 | — | |||||
Payments on principal of capital leases | (3,253 | ) | (2,326 | ) | |||
Payments of deferred offering costs | (2,603 | ) | (829 | ) | |||
Proceeds from issuance of convertible preferred stock | — | 52,427 | |||||
Proceeds from exercise of stock options | 6,649 | 2,164 | |||||
Taxes paid related to net share settlement of restricted stock units | (380 | ) | — |
Proceeds from Employee Stock Purchase Plan | 7,064 | — | |||||
Net cash provided by financing activities | 171,321 | 51,436 | |||||
Effect of foreign exchange on cash, cash equivalents, and restricted cash | (36 | ) | — | ||||
Net increase in cash, cash equivalents, and restricted cash | 154,646 | 37,046 | |||||
Cash, cash equivalents, and restricted cash | |||||||
Beginning of period | 61,059 | 24,013 | |||||
End of period | $ | 215,705 | $ | 61,059 | |||
Supplemental disclosures | |||||||
Cash paid for interest | $ | 324 | $ | 312 | |||
Cash paid for income taxes | 8 | — | |||||
Purchases of fixed assets under capital leases | 2,639 | 3,130 | |||||
Accrued purchases of property and equipment, including internal-use software | 992 | 181 | |||||
Deemed dividends on convertible preferred stock | — | (4,558 | ) | ||||
Deferred offering costs, accrued but not yet paid | 12 | 648 | |||||
Share-based compensation capitalized in internal-use software development costs | 189 | — |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(dollars in thousands) | |||||||||||||||
Loss from operations | $ | (12,685 | ) | $ | (8,615 | ) | $ | (55,084 | ) | $ | (48,978 | ) | |||
Add: | |||||||||||||||
Share-based compensation expense(1) | 3,919 | 880 | 15,903 | 18,464 | |||||||||||
Amortization of acquisition-related intangible assets | 120 | 40 | 480 | 40 | |||||||||||
One-time acquisition costs | 139 | 195 | 196 | 195 | |||||||||||
Non-GAAP operating loss | $ | (8,507 | ) | $ | (7,500 | ) | $ | (38,505 | ) | $ | (30,279 | ) | |||
Operating margin | (24 | )% | (26 | )% | (31 | )% | (44 | )% | |||||||
Non-GAAP operating margin | (16 | )% | (23 | )% | (22 | )% | (27 | )% |
(1) | Share-based compensation expense for the year ended January 31, 2018 includes share-based compensation expense related to the 2017 Tender Offer. |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(in thousands) | |||||||||||||||
Net loss | $ | (11,685 | ) | $ | (8,714 | ) | $ | (53,885 | ) | $ | (49,106 | ) | |||
Add: | |||||||||||||||
Share-based compensation expense(1) | 3,919 | 880 | 15,903 | 18,464 | |||||||||||
Amortization of acquisition-related intangible assets | 120 | 40 | 480 | 40 | |||||||||||
One-time acquisition costs | 139 | 195 | 196 | 195 | |||||||||||
Remeasurement of convertible preferred stock warrant liability | — | 584 | 1,326 | 795 | |||||||||||
Non-GAAP net loss | $ | (7,507 | ) | $ | (7,015 | ) | $ | (35,980 | ) | $ | (29,612 | ) |
(1) | Share-based compensation expense for the year ended January 31, 2018 includes share-based compensation expense related to the 2017 Tender Offer. |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
(in thousands) | |||||||||||
GAAP weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, basic and diluted | 104,140 | 19,443 | 83,141 | 18,273 | |||||||
Add: common shares that would have resulted from conversion of convertible preferred stock at the beginning of the period, or when granted (if later), on a weighted average basis | — | 68,480 | 16,698 | 66,595 | |||||||
Non-GAAP weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, basic and diluted | 104,140 | 87,923 | 99,839 | 84,868 |
January 31, | |||||
2019 | 2018 | ||||
Convertible preferred shares (as converted) | — | 68,480 | |||
Convertible preferred stock warrant | — | 137 | |||
Shares subject to outstanding common stock awards | 13,297 | 13,355 | |||
Shares issuable pursuant to the Employee Stock Purchase Plan | 134 | — | |||
Total potentially dilutive shares | 13,431 | 81,972 |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(in thousands) | |||||||||||||||
Net cash provided by (used in) operating activities | $ | 3,995 | $ | (6,615 | ) | $ | (2,855 | ) | $ | (13,581 | ) | ||||
Less: | |||||||||||||||
Purchases of property and equipment | (1,395 | ) | (1,926 | ) | (5,767 | ) | (6,006 | ) | |||||||
Capitalized internal-use software | (861 | ) | (669 | ) | (3,017 | ) | (3,350 | ) | |||||||
Payments on capital lease obligations | (733 | ) | (749 | ) | (3,253 | ) | (2,326 | ) | |||||||
Free cash flow | $ | 1,006 | $ | (9,959 | ) | $ | (14,892 | ) | $ | (25,263 | ) |
Three Months Ended January 31, | Year Ended January 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(in thousands) | |||||||||||||||
Total revenue | $ | 52,151 | $ | 32,963 | $ | 177,722 | $ | 111,253 | |||||||
Add: | |||||||||||||||
Deferred revenue (end of period) | 96,133 | 57,281 | 96,133 | 57,281 | |||||||||||
Less: | |||||||||||||||
Deferred revenue (beginning of period) | 84,151 | 50,895 | 57,281 | 32,712 | |||||||||||
Calculated billings | $ | 64,133 | $ | 39,349 | $ | 216,574 | $ | 135,822 |
Q1 FY 2020 | FY 2020 | ||||||||||||||
Low | High | Low | High | ||||||||||||
(in millions) | |||||||||||||||
Loss from operations | $ | (29.2 | ) | $ | (28.2 | ) | $ | (110.7 | ) | $ | (105.7 | ) | |||
Add: | |||||||||||||||
Share-based compensation expense | 9.0 | 9.0 | 45.0 | 45.0 | |||||||||||
Amortization of acquisition-related intangible assets | 0.2 | 0.2 | 0.7 | 0.7 | |||||||||||
Non-GAAP operating loss | $ | (20.0 | ) | $ | (19.0 | ) | $ | (65.0 | ) | $ | (60.0 | ) |
Q1 FY 2020 | FY 2020 | ||||||||||||||
Low | High | Low | High | ||||||||||||
(in millions) | |||||||||||||||
Net loss | $ | (28.7 | ) | $ | (27.7 | ) | $ | (108.7 | ) | $ | (103.7 | ) | |||
Add: | |||||||||||||||
Share-based compensation expense | 9.0 | 9.0 | 45.0 | 45.0 | |||||||||||
Amortization of acquisition-related intangible assets | 0.2 | 0.2 | 0.7 | 0.7 | |||||||||||
Non-GAAP net loss | $ | (19.5 | ) | $ | (18.5 | ) | $ | (63.0 | ) | $ | (58.0 | ) |