AvePoint, Inc. (NASDAQ: AVPT), the largest data management solutions provider for Microsoft 365, today announced financial results for the second quarter ended June 30, 2021. 

“In the second quarter we delivered record results, with revenue of $45.3 million, up 38% year-over-year, driven by the continued growth of Microsoft Teams and strong adoption of our collaboration security technologies,” said Dr. Tianyi Jiang (TJ), CEO and Co-Founder of AvePoint. “With the investments we are making across our go-to-market organization, including sales, customer success and channel, we aim to increase our market share of the Microsoft 365 user base, boost our customer retention rate and continue our strong growth in the SMB market via our channel partners.”

Second Quarter 2021 Financial Results

  • Total Revenue of $45.3 million, up 38% year-over-year
  • Total ARR1 of $139.0 million as of June 30, 2021, up 33% year-over-year
  • SaaS Revenue of $20.6 million, up 76% year-over-year
  • GAAP Operating Loss of $11.2 million; GAAP Operating Margin of (24.7%)
  • Non-GAAP Operating Income of $3.3 million; Non-GAAP Operating Margin of 7.3%
  • GAAP net loss attributable to AvePoint, Inc. of $11.6 million or $0.98 per share
  • Cash and Cash Equivalents of approximately $66.3 million as of June 30, 2021
  • Net proceeds of $204.5 million from business combination which closed on July 1st, subsequent to second quarter end

Second Quarter 2021 Key Highlights

  • The AvePoint SaaS cloud platform, AvePoint Online Services, achieved FedRAMP Authorization signifying its SaaS solutions are approved for use across all United States federal agencies at the moderate impact level. The platform was also assessed against the Information Security Registered Assessors Program (IRAP), which ensures compliance with information security and requirements as mandated by the Australian Government
  • AvePoint released its Salesforce Cloud Backup for managed service providers (MSPs) across 36 countries and via 58 distributor app marketplaces
  • APAC’s leading distributor of cloud solutions and services, rhipe, now offers AvePoint solutions to its managed service provider (MSP) customers
  • Continued expansion in user base with more than 8 million cloud users

Financial Outlook

For the third quarter of 2021, AvePoint currently expects:

  • Total revenues between $51.5 and $53.5 million
  • Non-GAAP operating income between $1.7 and $3.2 million

For the full year ending December 31, 2021, AvePoint currently expects:

  • Total revenues between $192.0 and $196.0 million 
  • Non-GAAP operating income between $4.7 and $7.7 million

Conference CallAvePoint will host a conference call today on August 10, 2021 to review its second quarter 2021 financial results and to discuss its financial outlook. The call is scheduled to begin at 4:30pm Eastern Time. Investors are invited to join the webcast by visiting https://ir.avepoint.com/events. The webcast will be available live, and a replay will be available following the completion of the live broadcast for approximately 90 days.

About AvePointCollaborate with confidence. AvePoint is the largest Microsoft 365 data management solutions provider, offering a full suite of SaaS solutions to migrate, manage and protect data. More than 8 million cloud users rely on our solutions. Our SaaS solutions are also available to managed service providers via more than 100 cloud marketplaces, so they can better support and manage their small and mid-sized business customers. Founded in 2001, AvePoint is a five-time Global Microsoft Partner of the Year and headquartered in Jersey City, New Jersey. For more information, visit https://www.avepoint.com.

Non-GAAP Financial MeasuresTo supplement AvePoint’s consolidated financial statements presented in accordance with GAAP, the company uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (including percentage of revenue figures), non-GAAP operating income and non-GAAP operating margin. In order for AvePoint’s investors to be better able to compare its current results with those of previous periods, the company has included a reconciliation of GAAP to non-GAAP financial measures at the end of this press release. These reconciliations adjust the related GAAP financial measures to exclude stock-based compensation expense. AvePoint believes the presentation of its non-GAAP financial measures enhances the user’s overall understanding of its historical financial performance. The presentation of AvePoint’s non-GAAP financial measures is not meant to be considered in isolation or as a substitute for its financial results prepared in accordance with GAAP, and AvePoint’s non-GAAP measures may be different from non-GAAP measures used by other companies.

Forward-Looking StatementsThis press release contains certain forward-looking statements within the meaning of the federal securities laws including statements the future performance of and market opportunities for AvePoint. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: changes in the competitive and regulated industries in which AvePoint operates, variations in operating performance across competitors, changes in laws and regulations affecting AvePoint's business and changes in AvePoint’s ability to implement business plans, forecasts, and to identify and realize additional opportunities, and the risk of downturns in the market and the technology industry. You should carefully consider the foregoing factors and the other risks and uncertainties described in the "Risk Factors" section of the registration statement on Form S-4 and other documents filed by AvePoint from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and AvePoint does not assume any obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. AvePoint does not gives any assurance that it will achieve its expectations.

Investor Contact

AvePoint, Inc., Sapphire Investor Relations, LLC.Erica Mannionir@avepoint.com617-542-6180

Media Contact

AvePoint, Inc.Nicole Cacinicole.caci@avepoint.com201-201-8143

AvePoint Operations, Inc. and SubsidiariesCondensed Consolidated Statements of Operations(In thousands, except per share amounts)(Unaudited) 

    For the Three Months Ended     For the Six Months Ended  
    June 30,     June 30,  
    2021     2020     2021     2020  
Revenue:                                
SaaS   $ 20,586     $ 11,699     $ 38,845     $ 21,942  
Term license and support     11,088       7,357       19,815       15,101  
Services     7,302       7,724       13,218       15,303  
Maintenance and OEM     5,458       5,776       10,867       11,781  
Perpetual license     910       400       1,399       1,490  
Total revenue     45,344       32,956       84,144       65,617  
Cost of revenue:                                
SaaS     4,564       2,543       9,004       5,057  
Term license and support     230       348       503       820  
Services     6,508       5,877       12,093       12,889  
Maintenance and OEM     418       305       898       674  
Total cost of revenue     11,720       9,073       22,498       19,440  
Gross profit     33,624       23,883       61,646       46,177  
Operating expenses:                                
Sales and marketing     29,001       14,010       48,302       28,051  
General and administrative     11,664       5,291       21,956       10,449  
Research and development     3,883       2,863       7,985       5,757  
Depreciation and amortization     279       268       537       541  
Total operating expenses     44,827       22,432       78,780       44,798  
Income (loss) from operations     (11,203 )     1,451       (17,134 )     1,379  
Interest income, net     11       5       24       9  
Other income (expense), net     62       439       (1 )     (389 )
Income (loss) before income taxes     (11,130 )     1,895       (17,111 )     999  
Income tax benefit     (73 )     (6,149 )     (1,112 )     (6,316 )
Net income (loss)   $ (11,057 )   $ 8,044     $ (15,999 )   $ 7,315  
Net income attributable to redeemable noncontrolling interest     (499 )           (896 )      
Net income (loss) attributable to AvePoint Operations, Inc.   $ (11,556 )   $ 8,044     $ (16,895 )   $ 7,315  
Deemed dividends on preferred stock     (24,742 )     (8,063 )     (33,536 )     (15,798 )
Net loss available to common shareholders   $ (36,298 )   $ (19 )   $ (50,431 )   $ (8,483 )
Net loss per share of common stock, basic and diluted   $ (3.09 )   $ (0.00 )   $ (4.32 )   $ (0.87 )
Weighted average of shares used in computing net loss per share of common stock, basic and diluted     11,732       9,793       11,663       9,750  

AvePoint Operations, Inc. and SubsidiariesCondensed Consolidated Balance Sheets(In thousands, except share and per share amounts)(Unaudited)

    June 30,     December 31,  
    2021     2020  
Assets                
Current assets                
Cash and cash equivalents   $ 66,338     $ 69,112  
Short-term investments     1,408       992  
Accounts receivable, net of allowance of $1,030 and $1,767 at June 30, 2021 and December 31, 2020, respectively     44,753       48,250  
Prepaid expenses and other current assets     4,319       2,343  
Total current assets     116,818       120,697  
Property and equipment, net     3,039       2,663  
Deferred contract costs     33,781       31,943  
Long-term unbilled receivables     6,440       5,499  
Other assets     12,238       8,252  
Total assets   $ 172,316     $ 169,054  
Liabilities, mezzanine equity, and stockholders’ deficiency                
Current liabilities:                
Accounts payable   $ 520     $ 774  
Accrued expenses and other liabilities     22,115       26,245  
Current portion of deferred revenue     68,974       65,203  
Total current liabilities     91,609       92,222  
Long-term portion of deferred revenue     7,596       9,485  
Share-based awards classified as liabilities     50,220       43,502  
Other non-current liabilities     3,587       3,658  
Total liabilities     153,012       148,867  
Commitments and contingencies (Note 10)                
Mezzanine equity                
Redeemable convertible preferred stock, $0.0001 par value; 10,895,226 shares authorized, 4,832,409 and 4,832,409 shares issued and outstanding with aggregate liquidation preferences of $508,273 and $403,361 at June 30, 2021 and December 31, 2020, respectively     216,926       183,390  
Redemption value of common shares     39,757       25,074  
Share-based awards     1,695       1,489  
Redeemable noncontrolling interest     4,143       3,061  
Total mezzanine equity     262,521       213,014  
Stockholders’ deficiency:                
Common stock, $0.0001 par value; 28,000,000 and 28,000,000 shares authorized, 11,946,412 and 11,513,451 shares issued and outstanding, at June 30, 2021 and December 31, 2020, respectively     12       12  
Additional paid-in capital     112,953       105,159  
Accumulated other comprehensive income     1,848       1,791  
Accumulated deficit     (358,030 )     (299,789 )
Total stockholders’ deficiency attributable to AvePoint Operations, Inc.     (243,217 )     (192,827 )
Total liabilities, mezzanine equity, and stockholders’ deficiency   $ 172,316     $ 169,054  

AvePoint Operations, Inc. and SubsidiariesCondensed Consolidated Statements of Cash Flows(In thousands)(Unaudited) 

    For the Six Months Ended  
    June 30,  
    2021     2020  
Operating activities                
Net income (loss)   $ (15,999 )   $ 7,315  
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Depreciation and amortization     537       541  
Foreign currency remeasurement (gain) loss     (134 )     220  
Provision for doubtful accounts     (732 )     818  
Stock-based compensation     17,799       2,854  
Gain on disposal of property and equipment     (15 )      
Deferred income taxes     (981 )     (5,788 )
Changes in operating assets and liabilities:                
Accounts receivable     2,399       4,822  
Prepaid expenses and other current assets     (1,994 )     407  
Other assets     (1,955 )     719  
Accounts payable, accrued expenses and other liabilities     (4,057 )     (6,896 )
Deferred revenue     3,298       964  
Accrued rent obligation     (87 )     (206 )
Net cash provided by (used in) operating activities     (1,921 )     5,770  
Investing activities                
Maturity (purchase) of short-term investments, net     (423 )     1,034  
Purchase of APXT shares     (1,631 )      
Purchase of property and equipment     (897 )     (169 )
Cash provided by (used in) investing activities     (2,951 )     865  
Financing activities                
Repayments of capital leases     (14 )     (33 )
Payments of transaction fees     (1,872 )      
Proceeds from stock option exercises     3,277       15  
Proceeds from sale of common shares of subsidiary     753        
Payments of debt issuance costs           (120 )
Proceeds from issuance of Common stock           7,000  
Net cash provided by financing activities     2,144       6,862  
Effect of exchange rates on cash     (46 )     (284 )
Net increase (decrease) in cash and cash equivalents     (2,774 )     13,213  
Cash and cash equivalents at beginning of period     69,112       12,162  
Cash and cash equivalents at end of period   $ 66,338     $ 25,375  
Supplemental disclosures of cash flow information                
Cash received (paid) for:                
Interest   $ 24     $ 8  
Income taxes   $ (2,389 )   $ (529 )
Non-cash investing and financing activities                
Fixed assets acquired under capital leases   $     $ 28  
    For the Three Months Ended     For the Six Months Ended  
    June 30,     June 30,  
    2021     2020     2021     2020  
Non-GAAP gross profit                                
GAAP gross profit   $ 33,624     $ 23,883     $ 61,646     $ 46,177  
Stock-based compensation expense     272       190       362       102  
Non-GAAP gross profit   $ 33,896     $ 24,073     $ 62,008     $ 46,279  
Non-GAAP gross margin     74.8 %     73.0 %     73.7 %     70.5 %
Non-GAAP sales and marketing                                
GAAP sales and marketing   $ 29,001     $ 14,010     $ 48,302     $ 28,051  
Stock-based compensation expense     (9,791 )     (1,510 )     (10,902 )     (1,310 )
Non-GAAP sales and marketing   $ 19,210     $ 12,500     $ 37,400     $ 26,741  
Non-GAAP sales and marketing as a % of revenue     42.4 %     37.9 %     44.4 %     40.8 %
Non-GAAP research and development                                
GAAP research and development   $ 3,883     $ 2,863     $ 7,985     $ 5,757  
Stock-based compensation expense     (83 )     (72 )     (180 )     (147 )
Non-GAAP research and development   $ 3,800     $ 2,791     $ 7,805     $ 5,610  
Non-GAAP research and development as a % of revenue     8.4 %     8.5 %     9.3 %     8.5 %
Non-GAAP general and administrative                                
GAAP general and administrative   $ 11,664     $ 5,291     $ 21,956     $ 10,449  
Stock-based compensation expense     (4,364 )     (1,007 )     (6,355 )     (1,295 )
Non-GAAP general and administrative   $ 7,300     $ 4,284     $ 15,601     $ 9,154  
Non-GAAP general and administrative as a % of revenue     16.1 %     13.0 %     18.5 %     14.0 %
Non-GAAP depreciation and amortization                                
GAAP depreciation and amortization   $ 279     $ 268     $ 537     $ 541  
Non-GAAP depreciation and amortization   $ 279     $ 268     $ 537     $ 541  
Non-GAAP depreciation and amortization as a % of revenue     0.6 %     0.8 %     0.6 %     0.8 %
Non-GAAP operating expenses                                
GAAP operating expenses   $ 44,827     $ 22,432     $ 78,780     $ 44,798  
Stock-based compensation expense     (14,238 )     (2,589 )     (17,437 )     (2,752 )
Non-GAAP operating expenses   $ 30,589     $ 19,843     $ 61,343     $ 42,046  
Non-GAAP operating expenses as a % of revenue     67.5 %     60.2 %     72.9 %     64.1 %
Non-GAAP operating income                                
GAAP operating income (loss)   $ (11,203 )   $ 1,451     $ (17,134 )   $ 1,379  
Stock-based compensation expense     14,510       2,779       17,799       2,854  
Non-GAAP operating income   $ 3,307     $ 4,230     $ 665     $ 4,233  
Non-GAAP operating margin     7.3 %     12.8 %     0.8 %     6.5 %

____________1 AvePoint calculates annual recurring revenue (“ARR”) at the end of a particular period as the annualized sum of: (1) contractually obligated Annual Contract Value from subscription and maintenance revenue sources from all customers with a contract duration exceeding three months, and (2) the product of the current month’s monthly recurring revenue (“MRR”) multiplied by twelve (to prospectively annualize subscription revenue). MRR includes AvePoint’s channel business and customers that sign contracts for less than one quarter in duration. ARR also includes some recurring professional services revenue, such as recurring technical account management services.

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