Brightcove Inc. (Nasdaq: BCOV), the global leader in video for
business, today announced financial results for the first quarter
ended March 31, 2021.
“Brightcove’s performance in the first quarter further
demonstrates that our strategy is working, highlighted by
double-digit subscription revenue growth and our best-ever adjusted
EBITDA margin,” said Jeff Ray, Brightcove’s Chief Executive
Officer. “The proliferation of video is changing the way
enterprises, media organizations, and content creators work.
Customers choose Brightcove because our video platform provides the
reliability, scalability, and security they need to meet multiple
critical business challenges. Our investments in innovation and
go-to-market are creating greater value for customers and
positioning us to deliver on our long-term financial targets.”
First Quarter 2021 Financial Highlights:
- Revenue for the first quarter of 2021 was $54.8 million,
an increase of 18% compared to $46.7 million for the first quarter
of 2020. Subscription and support revenue was $50.8 million, an
increase of 14% compared to $44.7 million for the first quarter of
2020.
- Gross profit for the first quarter of 2021 was $35.6
million, representing a gross margin of 65% compared to a gross
profit of $28.0 million and 60% for the first quarter of 2020.
Non-GAAP gross profit for the first quarter of 2021 was $36.2
million, representing a non-GAAP gross margin of 66%, compared to a
non-GAAP gross profit of $28.8 million and 62% for the first
quarter of 2020. Non-GAAP gross profit and non-GAAP gross margin
exclude stock-based compensation expense and the amortization of
acquired intangible assets.
- Income from operations was $6.1 million for the first
quarter of 2021, compared to a loss of $7.1 million for the first
quarter of 2020. Non-GAAP operating income, which excludes
stock-based compensation expense, restructuring, the amortization
of acquired intangible assets, merger-related expense and other
(benefit) expense, was $7.2 million for the first quarter of 2021,
compared to non-GAAP operating income of $2.3 million during the
first quarter of 2020.
- Net income was $5.1 million, or $0.12 per diluted share,
for the first quarter of 2021. This compares to a net loss of $7.9
million, or a loss of $0.20 per diluted share, for the first
quarter of 2020. Non-GAAP net income, which excludes stock-based
compensation expense, restructuring, the amortization of acquired
intangible assets, merger-related expense and other (benefit)
expense, was $6.2 million for the first quarter of 2021, or $0.15
per diluted share, compared to non-GAAP net income of $1.5 million
for the first quarter of 2020, or $0.04 per diluted share.
- Adjusted EBITDA was $8.6 million for the first quarter
of 2021, compared to adjusted EBITDA of $3.7 million for the first
quarter of 2020. Adjusted EBITDA excludes stock-based compensation
expense, merger-related expense, other (benefit) expense,
restructuring, the amortization of acquired intangible assets,
depreciation expense, other income/expense and the provision for
income taxes.
- Cash flow used by operations was $604,000 for the first
quarter for 2021, compared to cash flow provided by operations of
$2.4 million for the first quarter of 2020.
- Free cash flow was negative $2.1 million after the
company invested $1.5 million in capital expenditures and
capitalization of internal-use software during the first quarter of
2021. Free cash flow was negative $252,000 for the first quarter of
2020.
- Cash and cash equivalents were $35.2 million as of March
31, 2021 compared to $37.5 million on December 31, 2020.
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:
- Average annual subscription revenue per premium customer was
$97,000 in the first quarter of 2021, excluding starter customers
who had average annualized revenue of $4,300 per customer. This
compares to $84,600 in the comparable period in 2020.
- Recurring dollar retention rate was 85% in the first quarter of
2021, versus our historical target of the low to mid-90 percent
range.
- Ended the quarter with 3,312 customers, of which 2,273 were
premium.
- New customers and customers who expanded their relationship
during the first quarter include: Box, Inc., Giants Enterprises,
LLC, Convenii, Outside Magazine, Akamai Technologies, GEDI Digital,
Hagerty, Little League Baseball Incorporated, EMC Corp., Tver,
Forbes, Entercom Communications and Kraft Heinz.
- Launched Brightcove Virtual Events for Business, an intuitive,
easy-to-use virtual event solution for highly repeatable, mid-sized
events. Virtual Events for Business is a virtual event creation,
marketing, and delivery platform designed to easily service the
rapidly expanding number of events hosted by organizations. Many
enterprises are planning for life after COVID and want to continue
to maximize the extended reach they have achieved with virtual
events over the past year and a half. Brightcove Virtual Events for
Business makes it simple for enterprises to hold high volume,
repeatable events to connect with audiences across all aspects of
their organization.
- Announced a partnership with L2, a solution provider for arts
and cultural institutions. L2 will integrate Brightcove with
Tessitura and Stripe to provide a seamless interface that enables
cultural organizations to allow viewers to purchase and stream
performances instantly.
Business Outlook
Based on information as of today, April 28, 2021, the Company is
issuing the following financial guidance.
Second Quarter 2021:
- Revenue is expected to be in the range of $49.5 million
to $50.5 million, including approximately $2.7 million of
professional services revenue.
- Non-GAAP income from operations is expected to be in the
range of $1.0 million to $2.0 million, which excludes stock-based
compensation of approximately $2.0 million and the amortization of
acquired intangible assets of approximately $0.7 million.
- Adjusted EBITDA is expected to be in the range of $2.4
million to $3.4 million, which excludes stock-based compensation of
approximately $2.0 million, the amortization of acquired intangible
assets of approximately $0.7 million, depreciation expense of
approximately $1.3 million, and other income/expense and the
provision for income taxes of approximately $0.3 million.
- Non-GAAP net income per diluted share is expected to be
$0.02 to $0.04, which excludes stock-based compensation of
approximately $2.0 million, the amortization of acquired intangible
assets of approximately $0.7 million, and assumes approximately
42.9 million weighted-average shares outstanding.
Full Year 2021:
- Revenue is expected to be in the range of $211.0 million
to $217.0 million, including approximately $12.5 million of
professional services revenue.
- Non-GAAP income from operations is expected to be in the
range of $20.0 million to $25.0 million, which excludes stock-based
compensation of approximately $9.2 million, the amortization of
acquired intangible assets of approximately $3.0 million and other
(benefit) expense of ($2.0) million.
- Adjusted EBITDA is expected to be in the range of $25.5
million to $30.5 million, which excludes stock-based compensation
of approximately $9.2 million, the amortization of acquired
intangible assets of approximately $3.0 million, depreciation
expense of approximately $5.3 million, other (benefit) expense of
approximately ($2.0) million, and other income/expense and the
provision for income taxes of approximately $1.7 million.
- Non-GAAP earnings per diluted share is expected to be
$0.43 to $0.54, which excludes stock-based compensation of
approximately $9.2 million, the amortization of acquired intangible
assets of approximately $3.0 million, other (benefit) expense of
($2.0) million and assumes approximately 43.1 million
weighted-average shares outstanding.
Conference Call Information
Brightcove will host a conference call today, April 28, 2021, at
5:00 p.m. (Eastern Time) to discuss the Company's financial results
and current business outlook. A live webcast of the call will be
available at the “Investors” page of the Company’s website,
http://investor.brightcove.com. To access the call, dial
877-407-3982 (domestic) or 201-493-6780 (international). A replay
of this conference call will be available for a limited time at
844-512-2921 (domestic) or 412-317-6671 (international). The replay
conference ID is 13718674. A replay of the webcast will also be
available for a limited time at http://investor.brightcove.com.
About Brightcove Inc. (NASDAQ: BCOV)
When video is done right, it can have a powerful and lasting
effect. Hearts open. Minds change. Creativity thrives. Since 2004,
Brightcove has been helping customers discover and experience the
incredible power of video through its award-winning technology,
empowering organizations in more than 70 countries across the globe
to touch audiences in bold and innovative ways.
Brightcove achieves this by developing technologies once thought
impossible, providing customer support without parallel or excuses,
and leveraging the expertise and resources of a global
infrastructure. Video is the world’s most compelling, exciting
medium. Visit www.brightcove.com. 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 2021, 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 our business operations, 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; the timing and successful integration of the Ooyala
acquisition; 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. 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 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, 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, restructuring 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.
Brightcove Inc. Condensed Consolidated Balance Sheets
(in thousands) March 31, 2021 December 31,
2020 Assets Current assets: Cash and cash equivalents
$
35,152
$
37,472
Accounts receivable, net of allowance
30,594
29,305
Prepaid expenses and other current assets
22,668
18,738
Total current assets
88,414
85,515
Property and equipment, net
16,188
15,968
Operating lease right-of-use asset
7,722
8,699
Intangible assets, net
9,699
10,465
Goodwill
60,902
60,902
Other assets
6,143
5,254
Total assets
$
189,068
$
186,803
Liabilities and stockholders' equity Current liabilities:
Accounts payable
$
11,556
$
10,456
Accrued expenses
21,119
25,397
Operating lease liability
3,615
4,346
Deferred revenue
58,889
58,741
Total current liabilities
95,179
98,940
Operating lease liability, net of current portion
4,625
5,498
Other liabilities
1,397
2,763
Total liabilities
101,201
107,201
Stockholders' equity: Common stock
40
40
Additional paid-in capital
290,403
287,059
Treasury stock, at cost
(871
)
(871
)
Accumulated other comprehensive loss
(397
)
(188
)
Accumulated deficit
(201,308
)
(206,438
)
Total stockholders’ equity
87,867
79,602
Total liabilities and stockholders' equity
$
189,068
$
186,803
Brightcove Inc. Condensed Consolidated Statements
of Operations (in thousands, except per share amounts)
Three Months Ended March
31,
2021
2020
Revenue: Subscription and support revenue
$
50,839
$
44,658
Professional services and other revenue
3,978
1,995
Total revenue
54,817
46,653
Cost of revenue: (1) (2) Cost of subscription and support revenue
15,678
16,748
Cost of professional services and other revenue
3,490
1,894
Total cost of revenue
19,168
18,642
Gross profit
35,649
28,011
Operating expenses: (1) (2) Research and development
8,284
8,853
Sales and marketing
16,149
14,174
General and administrative
7,059
6,532
Merger-related
-
5,509
Other (benefit) expense
(1,965
)
-
Total operating expenses
29,527
35,068
Income (loss) from operations
6,122
(7,057
)
Other (expense) income, net
(735
)
(468
)
Income (loss) before income taxes
5,387
(7,525
)
Provision for income taxes
257
328
Net income (loss) before income taxes
$
5,130
$
(7,853
)
Net (loss) income per share—basic and diluted Basic
$
0.13
$
(0.20
)
Diluted
0.12
(0.20
)
Weighted-average shares—basic and diluted Basic
40,154
38,981
Diluted
42,480
38,981
(1) Stock-based compensation included in above line items:
Cost of subscription and support revenue
$
157
$
190
Cost of professional services and other revenue
68
80
Research and development
322
440
Sales and marketing
737
911
General and administrative
1,008
997
(2) Amortization of acquired intangible assets
included in the above line items: Cost of subscription and support
revenue
$
335
$
495
Sales and marketing
431
477
Brightcove Inc. Condensed Consolidated Statements
of Cash Flows (in thousands)
Three Months Ended March
31,
Operating activities
2021
2020
Net income (loss)
$
5,130
$
(7,853
)
Adjustments to reconcile net loss to net cash provided by operating
activities: Depreciation and amortization
2,163
2,408
Stock-based compensation
2,292
2,618
Provision for reserves on accounts receivable
71
275
Changes in assets and liabilities: Accounts receivable
(1,585
)
3,607
Prepaid expenses and other current assets
(1,390
)
(1,843
)
Other assets
(919
)
195
Accounts payable
(425
)
2,364
Accrued expenses
(5,797
)
(2,264
)
Operating leases
(626
)
(34
)
Deferred revenue
482
2,968
Net cash (used in) provided by operating activities
(604
)
2,441
Investing activities Purchases of property and
equipment, net of returns
(468
)
(720
)
Capitalization of internal-use software costs
(1,054
)
(1,973
)
Net cash used in investing activities
(1,522
)
(2,693
)
Financing activities Proceeds from exercise of stock
options
1,095
36
Deferred acquisition payments
(475
)
-
Proceeds from debt
-
10,000
Other financing activities
(87
)
(26
)
Net cash provided by financing activities
533
10,010
Effect of exchange rate changes on cash and cash equivalents
(727
)
(428
)
Net (decrease) increase in cash and cash equivalents
(2,320
)
9,330
Cash and cash equivalents at beginning of period
37,472
22,759
Cash and cash equivalents at end of period
$
35,152
$
32,089
Brightcove Inc. Reconciliation of GAAP Gross
Profit, GAAP Loss From Operations, GAAP Net Loss and GAAP Net Loss
Per Share to Non-GAAP Gross Profit, Non-GAAP Income 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,
2021
2020
GROSS PROFIT: GAAP gross profit
$
35,649
$
28,011
Stock-based compensation expense
225
270
Amortization of acquired intangible assets
335
495
Non-GAAP gross profit
$
36,209
$
28,776
INCOME (LOSS) FROM OPERATIONS: GAAP income (loss) from operations
$
6,122
$
(7,057
)
Stock-based compensation expense
2,292
2,618
Amortization of acquired intangible assets
766
972
Merger-related
-
5,509
Restructuring
-
229
Other (benefit) expense
(1,965
)
-
Non-GAAP income from operations
$
7,215
$
2,271
NET INCOME (LOSS): GAAP net income (loss)
$
5,130
$
(7,853
)
Stock-based compensation expense
2,292
2,618
Amortization of acquired intangible assets
766
972
Merger-related
-
5,509
Restructuring
-
229
Other (benefit) expense
(1,965
)
-
Non-GAAP net income
$
6,223
$
1,475
GAAP diluted net income (loss) per share
$
0.12
$
(0.20
)
Non-GAAP diluted net income per share
$
0.15
$
0.04
Shares used in computing GAAP diluted net income (loss) per
share
40,154
38,981
Shares used in computing Non-GAAP diluted net income (loss) per
share
42,480
39,449
Brightcove Inc. Calculation of Adjusted EBITDA
(in thousands)
Three Months Ended March
31,
2021
2020
Net income (loss)
$
5,130
$
(7,853
)
Other expense, net
735
468
Provision for income taxes
257
328
Depreciation and amortization
2,163
2,408
Stock-based compensation expense
2,292
2,618
Merger-related
-
5,509
Restructuring
-
229
Other (benefit) expense
(1,965
)
-
Adjusted EBITDA
$
8,612
$
3,707
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210428006047/en/
Investors: ICR for Brightcove Brian Denyeau, 646-277-1251
brian.denyeau@icrinc.com or Media: Brightcove Meredith
Duhaime mduhaime@brightcove.com
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