Brightcove Announces Financial Results for Second Quarter Fiscal Year 2022
Brightcove Inc. (Nasdaq: BCOV) reported Q2 2022 revenue of $54.4 million, up 6% year-over-year. Subscription and support revenue increased 9% to $53.0 million. Gross profit was $35.7 million with a gross margin of 66%. A net loss of $301,000 or $0.01 per diluted share was reported, contrasting with a net income of $870,000 in Q2 2021. The company anticipates Q3 2022 revenue between $52.0 million and $53.0 million. New strategies and leadership appointments were mentioned to enhance growth.
- Revenue increased 6% to $54.4 million for Q2 2022.
- Subscription and support revenue rose 9% to $53.0 million.
- Adjusted EBITDA improved to $6.7 million, up from $5.6 million year-over-year.
- Cash flow from operations was $9.9 million, up from $8.0 million in Q2 2021.
- Net loss of $301,000 in Q2 2022, compared to net income of $870,000 in Q2 2021.
- Recurring dollar retention rate at 84%, below historical targets of low to mid-90s.
- Free cash flow decreased to $2.4 million, down from $5.7 million in Q2 2021.
“Brightcove’s second quarter revenue and profitability once again exceeded the high end of our guidance range. In my first 100 days with the company, we have developed a comprehensive plan that will leverage the strength of our online streaming platform with new innovation and solutions that will enable any company, brand or creator to own their digital future,” said
DeBevoise added, “Brightcove’s vision is to be the most trusted streaming technology company in the world. I am confident that we have the right team and strategy in place to deliver on this vision and accelerate Brightcove’s revenue and profitability in the years ahead.”
Second Quarter 2022 Financial Highlights:
● Revenue for the second quarter of 2022 was
● Gross profit for the second quarter of 2022 was
● Income from operations was
● Net loss was
● Adjusted EBITDA was
● Cash flow provided by operations was
● Free cash flow was
● Cash and cash equivalents were
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 Second Quarter and Recent Highlights:
● Average annual subscription revenue per premium customer was
● Recurring dollar retention rate was
● Net revenue retention in the quarter was
● Ended the second quarter of 2022 with 2,937 customers, of which 2,301 were premium.
● New customers and customers who expanded their relationship during the second quarter of 2022 include: The
● Appointed
● Appointed
● Announced
Business Outlook
Based on information as of today,
Third Quarter 2022:
● Revenue is expected to be in the range of
● Non-GAAP income from operations is expected to be in the range of
● Adjusted EBITDA is expected to be in the range of
● Non-GAAP net income per diluted share is expected to be
Full Year 2022:
● Revenue is expected to be in the range of
● Non-GAAP income from operations is expected to be in the range of
● Adjusted EBITDA is expected to be in the range of
● Non-GAAP earnings per diluted share is expected to be
Earnings Stream Information
Brightcove earnings will be streamed on
About
Brightcove creates the world’s most reliable, scalable, and secure video 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 80 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 Twitter, LinkedIn, and Facebook.
Visit www.brightcove.com. Brightcove. Video that means business™
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 2022, our position to execute on our growth strategy, 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 the COVID-19 pandemic, including on our business operations and broader conditions, as well as its impact on the general economic and financial market conditions; 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; 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
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 and non-GAAP diluted net income (loss) per share. 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, 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, and other (benefit) expense. Merger-related expenses include fees incurred in connection with an acquisition. 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.
Condensed Consolidated Balance Sheets | |||||||||||||
(in thousands) | |||||||||||||
Assets | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ |
27,804 |
|
$ |
45,739 |
|
|||||||
Accounts receivable, net of allowance |
|
32,567 |
|
|
29,866 |
|
|||||||
Prepaid expenses and other current assets |
|
21,262 |
|
|
18,625 |
|
|||||||
Total current assets |
|
81,633 |
|
|
94,230 |
|
|||||||
Property and equipment, net |
|
32,538 |
|
|
20,514 |
|
|||||||
Operating lease right-of-use asset |
|
19,048 |
|
|
24,891 |
|
|||||||
Intangible assets, net |
|
12,088 |
|
|
9,276 |
|
|||||||
|
74,837 |
|
|
60,902 |
|
||||||||
Other assets |
|
6,465 |
|
|
6,655 |
|
|||||||
Total assets | $ |
226,609 |
|
$ |
216,468 |
|
|||||||
Liabilities and stockholders' equity | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ |
11,956 |
|
$ |
11,039 |
|
|||||||
Accrued expenses |
|
22,907 |
|
|
20,925 |
|
|||||||
Operating lease liability |
|
2,595 |
|
|
2,600 |
|
|||||||
Deferred revenue |
|
64,567 |
|
|
62,057 |
|
|||||||
Total current liabilities |
|
102,025 |
|
|
96,621 |
|
|||||||
Operating lease liability, net of current portion |
|
20,970 |
|
|
22,801 |
|
|||||||
Other liabilities |
|
877 |
|
|
786 |
|
|||||||
Total liabilities |
|
123,872 |
|
|
120,208 |
|
|||||||
Stockholders' equity: | |||||||||||||
Common stock |
|
42 |
|
|
41 |
|
|||||||
Additional paid-in capital |
|
308,307 |
|
|
298,793 |
|
|||||||
|
(871 |
) |
|
(871 |
) |
||||||||
Accumulated other comprehensive loss |
|
(1,762 |
) |
|
(662 |
) |
|||||||
Accumulated deficit |
|
(202,979 |
) |
|
(201,041 |
) |
|||||||
Total stockholders’ equity |
|
102,737 |
|
|
96,260 |
|
|||||||
Total liabilities and stockholders' equity | $ |
226,609 |
|
$ |
216,468 |
|
Condensed Consolidated Statements of Operations | |||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Revenue: | |||||||||||||||
Subscription and support revenue | $ |
52,988 |
|
$ |
48,602 |
|
$ |
104,589 |
|
$ |
99,441 |
|
|||
Professional services and other revenue |
|
1,459 |
|
|
2,870 |
|
|
3,237 |
|
|
6,848 |
|
|||
Total revenue |
|
54,447 |
|
|
51,472 |
|
|
107,826 |
|
|
106,289 |
|
|||
Cost of revenue: (1) (2) | |||||||||||||||
Cost of subscription and support revenue |
|
16,943 |
|
|
14,756 |
|
|
33,925 |
|
|
30,434 |
|
|||
Cost of professional services and other revenue |
|
1,761 |
|
|
2,468 |
|
|
3,759 |
|
|
5,958 |
|
|||
Total cost of revenue |
|
18,704 |
|
|
17,224 |
|
|
37,684 |
|
|
36,392 |
|
|||
Gross profit |
|
35,743 |
|
|
34,248 |
|
|
70,142 |
|
|
69,897 |
|
|||
Operating expenses: (1) (2) | |||||||||||||||
Research and development |
|
8,372 |
|
|
7,855 |
|
|
16,609 |
|
|
16,139 |
|
|||
Sales and marketing |
|
17,961 |
|
|
18,130 |
|
|
36,249 |
|
|
34,279 |
|
|||
General and administrative |
|
8,554 |
|
|
7,418 |
|
|
16,643 |
|
|
14,477 |
|
|||
Merger-related |
|
153 |
|
|
255 |
|
|
747 |
|
|
255 |
|
|||
Other expense (benefit) |
|
- |
|
|
- |
|
|
1,149 |
|
|
(1,965 |
) |
|||
Total operating expenses |
|
35,040 |
|
|
33,658 |
|
|
71,397 |
|
|
63,185 |
|
|||
Income (loss) from operations |
|
703 |
|
|
590 |
|
|
(1,255 |
) |
|
6,712 |
|
|||
Other (expense) income, net |
|
(825 |
) |
|
117 |
|
|
(1,212 |
) |
|
(618 |
) |
|||
(Loss) income before income taxes |
|
(122 |
) |
|
707 |
|
|
(2,467 |
) |
|
6,094 |
|
|||
Loss (benefit) from provision for income taxes |
|
179 |
|
|
(163 |
) |
|
(529 |
) |
|
94 |
|
|||
Net (loss) income | $ |
(301 |
) |
$ |
870 |
|
$ |
(1,938 |
) |
$ |
6,000 |
|
|||
Net (loss) income per share—basic and diluted | |||||||||||||||
Basic | $ |
(0.01 |
) |
$ |
0.02 |
|
$ |
(0.05 |
) |
$ |
0.15 |
|
|||
Diluted |
|
(0.01 |
) |
|
0.02 |
|
|
(0.05 |
) |
|
0.14 |
|
|||
Weighted-average shares—basic and diluted | |||||||||||||||
Basic |
|
41,723 |
|
|
40,615 |
|
|
41,580 |
|
|
40,386 |
|
|||
Diluted |
|
41,723 |
|
|
42,209 |
|
|
41,580 |
|
|
42,391 |
|
|||
(1) Stock-based compensation included in above line items: | |||||||||||||||
Cost of subscription and support revenue | $ |
144 |
|
$ |
187 |
|
$ |
253 |
|
$ |
344 |
|
|||
Cost of professional services and other revenue |
|
139 |
|
|
118 |
|
|
258 |
|
|
186 |
|
|||
Research and development |
|
935 |
|
|
531 |
|
|
1,657 |
|
|
853 |
|
|||
Sales and marketing |
|
899 |
|
|
762 |
|
|
1,842 |
|
|
1,499 |
|
|||
General and administrative |
|
1,527 |
|
|
1,011 |
|
|
2,864 |
|
|
2,019 |
|
|||
Other expense (benefit) |
|
- |
|
|
- |
|
|
249 |
|
|
- |
|
|||
(2) Amortization of acquired intangible assets included in the above line items: | |||||||||||||||
Cost of subscription and support revenue | $ |
376 |
|
$ |
336 |
|
$ |
780 |
|
$ |
671 |
|
|||
Sales and marketing |
|
416 |
|
|
407 |
|
|
829 |
|
|
838 |
|
Condensed Consolidated Statements of Cash Flows | |||||||
(in thousands) | |||||||
Six Months Ended |
|||||||
Operating activities |
|
2022 |
|
|
|
2021 |
|
Net (loss) income | $ |
(1,938 |
) |
$ |
6,000 |
|
|
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation and amortization |
|
4,227 |
|
|
4,278 |
|
|
Stock-based compensation |
|
7,123 |
|
|
4,901 |
|
|
Provision for reserves on accounts receivable |
|
70 |
|
|
276 |
|
|
Changes in assets and liabilities: | |||||||
Accounts receivable |
|
(2,394 |
) |
|
(2,634 |
) |
|
Prepaid expenses and other current assets |
|
(2,612 |
) |
|
(1,337 |
) |
|
Other assets |
|
161 |
|
|
(1,000 |
) |
|
Accounts payable |
|
(834 |
) |
|
105 |
|
|
Accrued expenses |
|
(1,183 |
) |
|
(6,053 |
) |
|
Operating leases |
|
4,007 |
|
|
(960 |
) |
|
Deferred revenue |
|
2,630 |
|
|
3,801 |
|
|
Net cash provided by operating activities |
|
9,257 |
|
|
7,377 |
|
|
Investing activities | |||||||
Cash paid for acquisition, net of cash acquired |
|
(13,215 |
) |
|
- |
|
|
Purchases of property and equipment, net of returns |
|
(5,791 |
) |
|
(808 |
) |
|
Capitalization of internal-use software costs |
|
(6,479 |
) |
|
(2,977 |
) |
|
Net cash used in investing activities |
|
(25,485 |
) |
|
(3,785 |
) |
|
Financing activities | |||||||
Proceeds from exercise of stock options |
|
100 |
|
|
1,980 |
|
|
Deferred acquisition payments |
|
- |
|
|
(475 |
) |
|
Other financing activities |
|
(7 |
) |
|
(1,348 |
) |
|
Net cash provided by financing activities |
|
93 |
|
|
157 |
|
|
Effect of exchange rate changes on cash and cash equivalents |
|
(1,800 |
) |
|
(834 |
) |
|
Net increase in cash and cash equivalents |
|
(17,935 |
) |
|
2,915 |
|
|
Cash and cash equivalents at beginning of period |
|
45,739 |
|
|
37,472 |
|
|
Cash and cash equivalents at end of period | $ |
27,804 |
|
$ |
40,387 |
|
Reconciliation of GAAP Gross Profit, GAAP Income (Loss) From Operations, GAAP Net (Loss) Income and GAAP Net (Loss) Income Per Share to | ||||||||||||||||||||
Non-GAAP Gross Profit, Non-GAAP Income From Operations, Non-GAAP Net Income and Non-GAAP Net Income Per Share | ||||||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||||||
|
2022 |
|
|
|
2021 |
|
|
2022 |
|
|
|
2021 |
|
|||||||
GROSS PROFIT: | ||||||||||||||||||||
GAAP gross profit | $ |
35,743 |
|
$ |
34,248 |
$ |
70,142 |
|
$ |
69,897 |
|
|||||||||
Stock-based compensation expense |
|
283 |
|
|
305 |
|
511 |
|
|
530 |
|
|||||||||
Amortization of acquired intangible assets |
|
376 |
|
|
336 |
|
780 |
|
|
671 |
|
|||||||||
Non-GAAP gross profit | $ |
36,402 |
|
$ |
34,889 |
$ |
71,433 |
|
$ |
71,098 |
|
|||||||||
INCOME (LOSS) FROM OPERATIONS: | ||||||||||||||||||||
GAAP income (loss) from operations | $ |
703 |
|
$ |
590 |
$ |
(1,255 |
) |
$ |
6,712 |
|
|||||||||
Stock-based compensation expense |
|
3,644 |
|
|
2,609 |
|
6,874 |
|
|
4,901 |
|
|||||||||
Amortization of acquired intangible assets |
|
792 |
|
|
743 |
|
1,609 |
|
|
1,509 |
|
|||||||||
Merger-related |
|
153 |
|
|
255 |
|
747 |
|
|
255 |
|
|||||||||
Other expense (benefit) |
|
- |
|
|
- |
|
1,149 |
|
|
(1,965 |
) |
|||||||||
Non-GAAP income from operations | $ |
5,292 |
|
$ |
4,197 |
$ |
9,124 |
|
$ |
11,412 |
|
|||||||||
NET INCOME (LOSS): | ||||||||||||||||||||
GAAP net (loss) income | $ |
(301 |
) |
$ |
870 |
$ |
(1,938 |
) |
$ |
6,000 |
|
|||||||||
Stock-based compensation expense |
|
3,644 |
|
|
2,609 |
|
6,874 |
|
|
4,901 |
|
|||||||||
Amortization of acquired intangible assets |
|
792 |
|
|
743 |
|
1,609 |
|
|
1,509 |
|
|||||||||
Merger-related |
|
153 |
|
|
255 |
|
747 |
|
|
255 |
|
|||||||||
Other expense (benefit) |
|
- |
|
|
- |
|
1,149 |
|
|
(1,965 |
) |
|||||||||
Non-GAAP net income | $ |
4,288 |
|
$ |
4,477 |
$ |
8,441 |
|
$ |
10,700 |
|
|||||||||
GAAP diluted net (loss) income per share | $ |
(0.01 |
) |
$ |
0.02 |
$ |
(0.05 |
) |
$ |
0.14 |
|
|||||||||
Non-GAAP diluted net income per share | $ |
0.10 |
|
$ |
0.11 |
$ |
0.20 |
|
$ |
0.25 |
|
|||||||||
Shares used in computing GAAP diluted net (loss) income per share |
|
41,723 |
|
|
42,209 |
|
41,580 |
|
|
42,391 |
|
|||||||||
Shares used in computing Non-GAAP diluted net income per share |
|
41,975 |
|
|
42,209 |
|
41,983 |
|
|
42,391 |
|
Calculation of Adjusted EBITDA | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||||||
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|||||
Net (loss) income | $ |
(301 |
) |
$ |
870 |
|
$ |
(1,938 |
) |
$ |
6,000 |
|
|||||||
Other expense, net |
|
825 |
|
|
(117 |
) |
|
1,212 |
|
|
618 |
|
|||||||
Provision for income taxes |
|
179 |
|
|
(163 |
) |
|
(529 |
) |
|
94 |
|
|||||||
Depreciation and amortization |
|
2,166 |
|
|
2,115 |
|
|
4,227 |
|
|
4,278 |
|
|||||||
Stock-based compensation expense |
|
3,644 |
|
|
2,609 |
|
|
6,874 |
|
|
4,901 |
|
|||||||
Merger-related |
|
153 |
|
|
255 |
|
|
747 |
|
|
255 |
|
|||||||
Other expense (benefit) |
|
- |
|
|
- |
|
|
1,149 |
|
|
(1,965 |
) |
|||||||
Adjusted EBITDA | $ |
6,666 |
|
$ |
5,569 |
|
$ |
11,742 |
|
$ |
14,181 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220802005881/en/
Investors:
ICR for Brightcove
brian.denyeau@icrinc.com
or
Media:
Brightcove
sgriggs@brightcove.com
Source:
FAQ
What were Brightcove's Q2 2022 financial results?
What is Brightcove's revenue guidance for Q3 2022?
What is the non-GAAP income from operations for Q2 2022?
How has the subscription revenue changed year-over-year for Brightcove?