VERB Extends Year Over Year SaaS Revenue Growth Delivers On Promise To Reduce R&D Expenses – Cut by 57%
August 15 2022 - 4:37PM
Verb Technology Company, Inc. (Nasdaq:
VERB) ("VERB" or the "Company"), the leader in interactive
video-based sales enablement applications, including shoppable
livestream, today reported financial and operating results for the
quarter ending June 30, 2022, and will hold an earnings conference
call at 5:30 p.m. ET to discuss these results.
The following compares the Company’s results of
operations for the second quarter of 2022 with the second quarter
of 2021.
-
Total digital revenue was $2.2 million, an
increase of 19% from the same period last year
-
SaaS subscription recurring revenue, a component
of Total digital revenue, was $2.0 million, an increase of 23% over
the same period last year.
-
Total Digital Revenue as a percentage of
Total revenue was 90%, compared with 76% for the same
period last year.
-
SaaS recurring revenue as a percentage of Total
revenue was 82%, compared with 67% for the same period
last year.
-
Total revenue was $2.4 million, up 0.3% from the
same period last year
-
Cost of revenue was $0.8 million, down 25% from
the same period last year, reflecting planned cost reductions and a
continuing shift towards the Company’s digital business and away
from the lower margin non-digital business.
- Gross margin was
65% compared with 53% for the same period last year, reflecting the
systematic transition of our low margin non-Digital business and
increase in our Digital revenue. Our Digital gross margin was 72%
compared to 69% for the same period last year.
- Capitalized software
development cost was $6.5 million on June 30, 2022.
Following the successful completion and launch of MARKET.live, we
expect to amortize the capitalized software development cost as a
non-cash charge to cost of revenue over the 36-month period from
third quarter of 2022 onward.
-
Research and development expenses
were $1.4 million, as compared to $3.2 million for the same period
last year, reflecting a 57% decrease due to planned cost
reductions. R&D expenses were down 13% over the first quarter
of 2022.
-
General and administrative expenses were $6.6
million as compared to $6.5 million for the same period last
year.
-
Modified EBITDA1 improved by $2.2
million, or 30%, when compared with the same period last year.
The following compares the Company’s results of
operations for the six months ended June 30, 2022 with the same
period in 2021.
-
Total digital revenue was $4.3 million, an
increase of 19% from the same period last year.
-
SaaS recurring subscription revenue was $4.0
million, an increase of 30% from the same period last year.
-
Added 19 new client contracts with a guaranteed
base value of $1.9 million.
-
Total revenue was $5.1 million, up 3.5% from the
same period last year, reflecting strong SaaS recurring revenue
growth offset by the Company’s strategic decision to continue to
wind down its lower margin non-digital business.
-
Cost of revenue was $1.8 million, down 23% from
the same period last year, reflecting planned cost reductions and a
shift towards the Company’s digital business and away from the
lower margin non-digital business.
-
Research and
development expenses were $3.0
million, as compared to $6.1 million for the same period last year,
reflecting a 51% decrease due to planned cost reductions.
-
General and administrative expenses were $13.6
million, a decrease of 2% from the same period last year primarily
due to the implementation of planned cost reductions offset by
planned increases in labor costs due to the launch of
MARKET.
-
Modified EBITDA1 improved by $3.2
million, or 23%, when compared with the same period last year.
-
Cash totaled $5.5 million as of June 30, 2022,
compared with $0.9 million on December 31, 2021. In April 2022, the
Company completed a registered direct offering with institutional
investors, which resulted in gross proceeds of $11.0 million.
-
Subsequent to quarter end, we repaid in full all advances
on future receipts, reducing current debt service
payments and cash burn by up to $1.5 million per
quarter.
1 Management considers our core operating
performance to be that which our managers can affect in any
particular period through their management of the resources that
affect our underlying revenue and profit generating operations that
period. Non-GAAP adjustments to our results prepared in accordance
with generally accepted accounting principles (“GAAP”) are itemized
below. You are encouraged to evaluate these adjustments and the
reasons we consider them appropriate for supplemental analysis. In
evaluating Modified EBITDA, you should be aware that in the future
we may incur expenses that are the same as or similar to some of
the adjustments in this presentation. Our presentation of Modified
EBITDA should not be construed as an inference that our future
results will be unaffected by unusual or non-recurring items.
In addition to our results under GAAP, we present
Modified EBITDA as a supplemental measure of our performance.
However, Modified EBITDA is not a recognized measurement under GAAP
and should not be considered as an alternative to net income,
income from operations, or any other performance measure derived in
accordance with GAAP or as an alternative to cash flow from
operating activities as a measure of liquidity. We define Modified
EBITDA as net income (loss), plus interest expense, depreciation
and amortization, share-based compensation, financing costs and
changes in fair value of derivative liability.
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
(in thousands) |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(6,374 |
) |
|
$ |
(11,812 |
) |
|
$ |
(13,363 |
) |
|
$ |
(20,157 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization |
|
|
395 |
|
|
|
400 |
|
|
|
804 |
|
|
|
814 |
|
Share-based compensation |
|
|
1,317 |
|
|
|
1,264 |
|
|
|
2,618 |
|
|
|
3,666 |
|
Interest expense |
|
|
642 |
|
|
|
596 |
|
|
|
1,398 |
|
|
|
1,104 |
|
Change in fair value of
derivative liability |
|
|
(1,024 |
) |
|
|
2,445 |
|
|
|
(2,162 |
) |
|
|
1,945 |
|
Other (income)/ expense |
|
|
(19 |
) |
|
|
(20 |
) |
|
|
45 |
|
|
|
(74 |
) |
Debt extinguishment, net |
|
|
- |
|
|
|
(91 |
) |
|
|
- |
|
|
|
(1,030 |
) |
Other non-recurring |
|
|
- |
|
|
|
- |
|
|
|
126 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total EBITDA adjustments |
|
|
1,311 |
|
|
|
4,594 |
|
|
|
2,829 |
|
|
|
6,425 |
|
Modified
EBITDA |
|
$ |
(5,063 |
) |
|
$ |
(7,218 |
) |
|
$ |
(10,534 |
) |
|
$ |
(13,732 |
) |
About VERBVerb Technology
Company, Inc. (Nasdaq: VERB), the market leader in interactive
video-based sales applications, transforms how businesses attract
and engage customers. The Company’s Software-as-a-Service, or SaaS,
platform is based on its proprietary interactive video technology,
and is comprised of a suite of sales enablement business software
products offered on a subscription basis. Its software applications
are used by hundreds of thousands of people in over 100 countries
and in more than 48 languages. VERB’s clients include large
sales-based enterprises as well as small business sales teams,
including the sales and marketing departments of professional
sports teams. MARKET.live is VERB’s multi-vendor, multi-presenter,
livestream social shopping platform at the forefront of the
convergence of ecommerce and entertainment. With approximately 150
employees and contractors, the Company is headquartered in Lehi,
Utah, and also maintains offices in Newport Beach, California.
For more information, please visit:
verb.tech.
Follow VERB here:VERB on Facebook:
facebook.com/VerbTechCoVERB on Twitter:
twitter.com/VerbTech_CoVERB on LinkedIn:
linkedin.com/company/verb-techVERB on YouTube:
youtube.com/channel/UC0eCb_fwQlwEG3ywHDJ4_KQMARKET – our livestream
social shopping platform: market.liveSign up for E-mail Alerts
here: ir.verb.tech/news-events/email-alerts
FORWARD-LOOKING STATEMENTS
This communication contains “forward-looking
statements” as that term is defined in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve
risks and uncertainties and include, without limitation, any
statement that may predict, forecast, indicate or imply future
results, performance or achievements, and may contain words such as
“anticipate,” “expect,” “project,” “plan,” or words or phrases with
similar meaning. Forward-looking statements contained in this press
release relate to statements regarding the Company's progress
towards achieving its strategic objectives. Forward-looking
statements are based on current expectations, forecasts and
assumptions that involve risks and uncertainties, including, but
not limited to (i) the COVID-19 pandemic and related public health
measures on our business, customers, markets and the worldwide
economy; (ii) our plans to attract new customers, retain existing
customers and increase our annual revenue; (iii) the development
and delivery of new products, including verbLIVE and MARKET; (iv)
our plans and expectations regarding software-as-a-service
offerings; (v) our ability to execute on, integrate, and realize
the benefits of any acquisitions; (vi) fluctuations in our
quarterly results of operations and other operating measures; (vii)
increases in competition; and (viii) general economic, market and
business conditions. If any of these risks or uncertainties
materialize, or if any of our assumptions prove incorrect, our
actual results could differ materially from the results expressed
or implied by these forward-looking statements. For additional
information regarding the risks and uncertainties that may cause
actual results to differ materially from those expressed in any
forward-looking statement, our investors are referred to our
filings with the Securities and Exchange Commission, including our
Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. All
forward-looking statements in this press release are based on
information available to us as of the date hereof, and we do not
assume any obligation to update the forward-looking statements
provided to reflect events that occur or circumstances that exist
after the date on which they were made, except as required by
law.
Investor Relations
Contact:888.504.9929investors@verb.techMedia
Contact:855.250.2300,
ext.107info@verb.tech
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