- First quarter total revenue of $33.3 million, up 30%
year-over-year
- Announced milestone in growth of IT Channel Partners
program
- Named Brett White as President & COO and Brendan Neish as
CPO
Weave Communications, Inc. (NYSE: WEAV), a leading all-in-one
customer communications and engagement software platform for small
and medium-sized businesses, today announced its financial results
for the first quarter ended March 31, 2022.
“We are in the early innings of many great operational
successes,” said CEO Roy Banks. “I am very excited about our 30%
year-over-year growth in Q1 and the market opportunity that lies
ahead of us for the remainder of 2022 and beyond.”
First Quarter 2022 Financial Highlights
- Total revenue was $33.3 million, representing a 30%
year-over-year increase compared to $25.7 million in the first
quarter of 2021.
- GAAP loss from operations was $13.5 million, compared to a GAAP
loss from operations of $8.7 million in the first quarter of
2021.
- Non-GAAP loss from operations was $10.1 million, compared to a
non-GAAP loss from operations of $6.9 million in the first quarter
of 2021.
- GAAP net loss attributable to common stockholders was $13.8
million, or $0.21 per share compared to a GAAP net loss
attributable to common stockholders of $9.5 million, or $0.79 per
share in the first quarter of 2021.
- Non-GAAP net loss attributable to common stockholders was $10.4
million, or $0.16 per share compared to a non-GAAP net loss
attributable to common stockholders of $7.2 million, or $0.59 per
share in the first quarter of 2021.
- Dollar-Based Net Retention Rate (NRR) was 103% as of March 31,
2022.
- Dollar-Based Gross Retention Rate (GRR) was 94% as of March 31,
2022.
Business Highlights
- Utah Business honored Roy Banks as Chief Executive Officer of
the year.
- Appointed Brett White as President and Chief Operating Officer
to leverage his extensive SaaS and payments experience.
- Appointed Branden Neish as Chief Product Officer to leverage
his extensive background in product development.
- Significantly expanded the functionality of our Web Assistant
product and its Online Scheduling features, giving practices more
flexibility in how patients schedule appointments directly from
their website, which saves them time and helps them capture more
business.
- Weave was named as a leader in four key software categories of
G2’s spring 2022 report: Optometry, Dental Practice Management,
Patient Relationship Management, and Patient Engagement.
- Weave was added to the Shatter List, a reward from The Women
Tech Council recognizing companies with active programs that are
leading and accelerating progress towards breaking the glass
ceiling for women in the technology sector.
Financial Second Quarter and Full Year 2022 Outlook
The company expects the following financial results for the
three months ending June 30, 2022 and year ending December 31,
2022:
Second Quarter
Full Year
Total revenue (in millions)
$33.0 - $34.0
$139.0 - $142.0
Non-GAAP loss from operations (in
millions)
$(11.0) - $(10.0)
$(40.0) - $(36.0)
Weighted average share count (in
millions)
65.1
66.0
Non-GAAP loss from operations excludes estimates for, among
other things, stock-based compensation expense. A reconciliation of
this non-GAAP financial guidance measure to a corresponding GAAP
financial guidance measure is not available on a forward-looking
basis because we do not provide guidance on GAAP net loss from
operations and are not able to present the various reconciling cash
and non-cash items between GAAP loss from operations and non-GAAP
loss from operations without unreasonable effort. In particular,
stock-based compensation expense is impacted by our future hiring
and retention needs, as well as the future fair market value of our
common stock, all of which is difficult to predict and is subject
to constant change. The actual amount of these expenses during 2022
will have a significant impact on our future GAAP financial
results.
Webcast
The company will host a conference call for analysts and
investors on Wednesday, May 4, 2022, beginning at 5 p.m. EST.
Individuals interested in listening to the conference call may
do so by dialing (646) 828-8193 or toll free at (888) 220-8451.
Please reference the following conference ID: 3278256. The live
webcast and a webcast replay of the conference call may be accessed
from the investor relations page of Weave’s website at
investors.getweave.com.
Lock-Up Termination
Beginning at the opening of trading on Friday, May 6, 2022, the
lock-up agreements that Weave’s directors, officers, and holders of
substantially all of Weave’s common stock and securities
exercisable for or convertible into common stock, entered into with
Goldman Sachs & Co. LLC, BofA Securities, Inc., and Citigroup
Global Markets, as representatives of the underwriters for Weave’s
recent initial public offering, will terminate.
About Weave
Weave is the all-in-one customer communications and engagement
platform for small business. From the first phone call to the final
invoice and every touchpoint in between, Weave connects the entire
customer journey. Weave’s software solutions transform how local
businesses attract, communicate with and engage customers to grow
their business. The first Utah company to join Y Combinator, Weave
has set the bar for Utah startup achievement & work culture. In
the past year, Weave has been included in the Forbes Cloud 100,
Inc. 5000 fastest-growing companies in America, and Glassdoor Best
Places to Work. To learn more, visit
www.getweave.com/newsroom/.
Forward Looking Statements
This press release and the accompanying conference call contain
forward-looking statements including, among others, current
estimates of second quarter and full year 2022 revenue and non-GAAP
loss from operations and statements in the quotes of our chief
executive officer relating to our market opportunity.
These forward-looking statements involve risks and
uncertainties. 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. These risks and uncertainties
include risks associated with: our ability to attract new
customers, retain existing customers, and increase our customers’
use of our platform; our ability to manage our growth; the impact
of the global COVID-19 pandemic on our company; our ability to
maintain and enhance our brand and increase market awareness of our
company, platform and products; customer adoption of our platform
and products; expansion into new vertical markets; customer
acquisition costs and sales and marketing strategies; competition;
our ability to enhance our platform and products; interruptions in
service; general business and economic conditions; and the risks
described in the filings we make from time to time with the
Securities and Exchange Commission (SEC) from time to time,
including the risks described under the heading “Risk Factors” in
our Annual Report on Form 10-K for the year ended December 31,
2021, filed with the SEC on March 23, 2022, which should be read in
conjunction with our financial results and forward-looking
statements and is available on the SEC Filings section of the
Investor Relations page of our website at
investors.getweave.com/.
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.
Channels for Disclosure of Information
Weave Communications uses the investor relations page on our
website, blog posts on our website, press releases, public
conference calls, webcasts, our twitter feed (@getweave), our
Facebook page, and our LinkedIn page as the means of complying with
our disclosure obligations under Regulation FD. We encourage
investors, the media, and others to follow the channels listed
above, in addition to following Weave Communications’ press
releases, SEC filings, and public conference calls and webcasts,
and to review the information disclosed through such channels.
Supplemental Financial Information
Dollar-Based Net Revenue Retention (NRR)
For retention rate calculations, we use adjusted monthly revenue
(AMR), which is calculated for each location as the sum of (i) the
subscription component of revenue for each month and (ii) the
average of the trailing-three-month recurring payments revenue. To
calculate our NRR, we first identify the cohort of locations (the
Base Locations) that were active in a particular month (the Base
Month). We then divide AMR for the Base Locations in the same month
of the subsequent year (the Comparison Month), by AMR in the Base
Month to derive a monthly NRR. We derive our annual NRR as of any
date by taking a weighted average of the monthly net retention
rates over the trailing twelve months prior to such date.
Dollar-Based Gross Revenue Retention (GRR)
To calculate our GRR, we first identify the cohort of locations
(the Base Locations) that were under subscription in a particular
month (the Base Month). We then calculate the effect of reductions
in revenue from customer location terminations by measuring the
amount of AMR in the Base Month for Base Locations still under
subscription twelve months subsequent to the Base Month (Remaining
AMR). We then divide Remaining AMR for the Base Locations by AMR in
the Base Month for the Base Locations to derive a monthly gross
retention rate. We calculate GRR as of any date by taking a
weighted average of the monthly gross retention rates over the
trailing twelve months prior to such date. GRR reflects the effect
of customer locations that terminate their subscriptions, but does
not reflect changes in revenue due to revenue expansion, revenue
contraction, or addition of new customer locations.
Non-GAAP Financial Measures
In this press release, Weave Communications has provided
financial information that has not been prepared in accordance with
generally accepted accounting principles in the United States
(GAAP). We disclose the following historical non-GAAP financial
measures in this press release: non-GAAP operating income (loss),
non-GAAP net loss, and non-GAAP net loss per share, Adjusted
EBITDA, and free cash flow. We use these non-GAAP financial
measures internally in analyzing our financial results and
evaluating our ongoing operational performance. We believe that
these non-GAAP financial measures provide an additional tool for
investors to use in understanding and evaluating ongoing operating
results and trends in the same manner as our management and board
of directors. Our use of these non-GAAP financial measures has
limitations as an analytical tool, and you should not consider them
in isolation or as a substitute for analysis of our financial
results as reported under GAAP. Because of these and other
limitations, you should consider these non-GAAP financial measures
along with other GAAP-based financial performance measures,
including various cash flow metrics, operating income (loss), net
loss, and our GAAP financial results. We have provided a
reconciliation of these non-GAAP financial measures to their most
directly comparable GAAP measures in the tables included in this
press release, and investors are encouraged to review the
reconciliation.
Non-GAAP net loss and non-GAAP net loss per share
We define non-GAAP net loss as GAAP net loss attributable to
common stockholders less stock-based compensation expense and
non-cash cumulative dividends on redeemable convertible preferred
stock. Non-GAAP net loss per share is calculated as non-GAAP net
loss divided by the diluted weighted-average shares
outstanding.
Non-GAAP gross profit
We define non-GAAP gross profit as GAAP gross profit less
stock-based compensation expense.
Non-GAAP operating expenses
We define non-GAAP operating expenses, in the aggregate or its
individual components (i.e., sales and marketing, research and
development or general and administrative), as the applicable GAAP
operating expenses less the applicable stock-based compensation
expense.
Non-GAAP operating income (loss)
We define non-GAAP operating income (loss) as GAAP operating
income (loss) less stock-based compensation expense.
Adjusted EBITDA
EBITDA is defined as earnings before interest expense, provision
for taxes, depreciation, and amortization. Our depreciation
adjustment includes depreciation on operating fixed assets and does
not include depreciation on phone hardware provided to our
customers. We further adjust EBITDA to exclude stock-based
compensation expense, a non-cash item. We believe that adjusted
EBITDA provides management and investors consistency and
comparability with our past financial performance and facilitates
period-to-period comparisons of operations. Additionally,
management uses adjusted EBITDA to measure our financial and
operational performance and prepare our budgets.
Free Cash Flow
We define free cash flow as net cash used in operating
activities, less purchases of property and equipment and
capitalized internal-use software costs. We believe that free cash
flow is a useful indicator of liquidity that provides useful
information to management and investors, even if negative, as it
provides information about the amount of cash consumed by our
combined operating and investing activities. For example, as free
cash flow has been negative, we have needed to access cash reserves
or other sources of capital for these investments.
The foregoing non-GAAP financial measures have a number of
limitations. For example, the non-GAAP financial information
presented above may be determined or calculated differently by
other companies and may not be directly comparable to that of other
companies. In addition, free cash flow does not reflect our future
contractual commitments and the total increase or decrease of our
cash balance for a given period. Further, Adjusted EBITDA excludes
some costs, namely, non-cash stock-based compensation expense.
Therefore, adjusted EBITDA does not reflect the non-cash impact of
stock-based compensation expense or working capital needs, that
will continue for the foreseeable future. All of these limitations
could reduce the usefulness of these non-GAAP financial measures as
analytical tools.
WEAVE COMMUNICATIONS,
INC
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited, in thousands
except share amounts)
March 31, 2022
December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents
$
128,900
$
135,996
Accounts receivable
2,897
3,059
Deferred contract acquisition costs,
net
8,967
8,931
Prepaid expenses
5,423
6,461
Total current assets
146,187
154,447
Non-current assets:
Property and equipment, net
11,868
24,502
Operating lease right-of-use assets
47,574
—
Finance lease right-of-use assets
12,214
—
Deferred contract acquisition costs, net,
less current portion
7,606
7,873
Other non-current assets
751
663
TOTAL ASSETS
$
226,200
$
187,485
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
4,229
$
4,061
Accrued liabilities
11,919
12,250
Deferred revenue
30,188
29,511
Current portion of operating lease
liabilities
4,941
—
Current portion of finance lease
liabilities
8,327
8,485
Current portion of long-term debt
—
—
Total current liabilities
59,604
54,307
Non-current liabilities:
Deferred rent
—
4,319
Operating lease liabilities, less current
portion
47,528
—
Finance lease liabilities, less current
portion
6,567
6,558
Long-term debt
10,000
10,000
Total liabilities
123,699
75,184
Stockholders' equity:
Preferred stock, $0.00001 par value per
share; 10,000,000 shares authorized, zero shares issued and
outstanding as of March 31, 2022 and December 31, 2021
—
—
Common stock, $0.00001 par value per
share; 500,000,000 shares authorized as of March 31, 2022 and
December 31, 2021; 64,889,304 and 64,324,628 shares issued and
outstanding as of March 31, 2022 and December 31, 2021,
respectively
—
—
Additional paid-in capital
298,214
294,230
Accumulated deficit
(195,736
)
(181,898
)
Accumulated other comprehensive (loss)
income
23
(31
)
Total stockholders' equity
102,501
112,301
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY
$
226,200
$
187,485
WEAVE COMMUNICATIONS,
INC
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited, in thousands,
except share and per share data)
Three Months Ended March
31,
2022
2021
Revenue
$
33,272
$
25,668
Cost of revenue
13,753
10,802
Gross profit
19,519
14,866
Operating expenses:
Sales and marketing
16,220
11,736
Research and development
7,204
5,836
General and administrative
9,604
6,003
Total operating expenses
33,028
23,575
Loss from operations
(13,509
)
(8,709
)
Other income (expense):
Interest expense
(293
)
(280
)
Other income (expense)
(4
)
6
Loss before income taxes
(13,806
)
(8,983
)
Provision for income taxes
(32
)
—
Net loss
$
(13,838
)
$
(8,983
)
Less: cumulative dividends on redeemable
convertible preferred stock
—
(549
)
Net loss attributable to common
stockholders
$
(13,838
)
$
(9,532
)
Net loss per share attributable to common
stockholders - basic and diluted
$
(0.21
)
$
(0.79
)
Weighted-average common shares outstanding
- basic and diluted
64,583,714
12,035,941
WEAVE COMMUNICATIONS,
INC
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(unaudited, in
thousands)
Three Months Ended March
31,
2022
2021
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss
$
(13,838
)
$
(8,983
)
Adjustments to reconcile net loss to net
cash used in operating activities
Depreciation and amortization
4,283
—
2,635
Provision for losses on accounts
receivable
150
23
Amortization of contract acquisition
costs
2,640
2,115
Stock-based compensation
3,425
1,824
Changes in operating assets and
liabilities:
Accounts receivable
12
(2,120
)
Contract acquisition costs
(2,409
)
(2,647
)
Prepaid expenses and other assets
950
222
Accounts payable
148
(197
)
Accrued liabilities
69
(390
)
Operating lease liabilities
(332
)
—
Deferred revenue
731
1,459
Deferred rent
—
787
Net cash used in operating activities
(4,171
)
(5,272
)
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchases of property and equipment
(541
)
(1,782
)
Capitalized internal-use software
costs
(367
)
(539
)
Net cash used in investing activities
(908
)
(2,321
)
CASH FLOWS FROM FINANCING
ACTIVITIES
Principal payments on finance leases
(2,176
)
(1,817
)
Proceeds from stock option exercises
559
248
Paid offering costs
(400
)
—
Net cash used in financing activities
(2,017
)
(1,569
)
NET DECREASE IN CASH AND CASH
EQUIVALENTS
(7,096
)
(9,162
)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD
135,996
55,698
CASH AND CASH EQUIVALENTS, END OF
PERIOD
$
128,900
$
46,536
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the period for
interest
$
293
$
280
SUPPLEMENTAL DISCLOSURE OF NONCASH
INVESTING AND FINANCING ACTIVITIES:
Equipment purchases financed with accounts
payable
$
20
$
36
Lease liabilities arising from obtaining
right-of-use assets
$
2,027
$
2,940
WEAVE COMMUNICATIONS,
INC
DISAGGREGATED REVENUE AND COST
OF REVENUE
(unaudited, in
thousands)
Three Months Ended March
31,
2022
2021
Subscription and payment
processing:
Revenue
$
31,950
$
23,899
Cost of revenue
(8,821
)
(6,416
)
Gross profit
$
23,129
$
17,483
Gross margin
72
%
73
%
Onboarding:
Revenue
$
262
$
1,038
Cost of revenue
(2,586
)
(2,320
)
Gross profit
$
(2,324
)
$
(1,282
)
Gross margin
(887
) %
(124
) %
Hardware:
Revenue
$
1,060
$
731
Cost of revenue (depreciation of phone
hardware over a 3-year useful life)
(2,346
)
(2,066
)
Gross profit
$
(1,286
)
$
(1,335
)
Gross margin
(121
) %
(183
) %
WEAVE COMMUNICATIONS,
INC
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES
(unaudited, in thousands,
except share and per share data)
The following tables reconcile the
specific items excluded from GAAP in the calculation of non-GAAP
financial measures for the periods indicated below:
Non-GAAP gross profit
Three Months Ended March
31,
2022
2021
Gross profit
$
19,519
$
14,866
Stock-based compensation add back
148
69
Non-GAAP gross profit
$
19,667
$
14,935
Non-GAAP operating expenses
Three Months Ended March
31,
2022
2021
Sales and marketing
$
16,220
$
11,736
Stock-based compensation excluded
(662
)
(132
)
Non-GAAP sales and marketing
$
15,558
$
11,604
Research and development
$
7,204
$
5,836
Stock-based compensation excluded
(552
)
(396
)
Non-GAAP research and development
$
6,652
$
5,440
General and administrative
$
9,604
$
6,003
Stock-based compensation excluded
(2,063
)
(1,227
)
Non-GAAP general and administrative
$
7,541
$
4,776
Non-GAAP loss from operations
Three Months Ended March
31,
2022
2021
Loss from operations
$
(13,509
)
$
(8,709
)
Stock-based compensation add back
3,425
1,824
Non-GAAP loss from operations
$
(10,084
)
$
(6,885
)
Non-GAAP net loss
Three Months Ended March
31,
2022
2021
Net loss attributable to common
stockholders
$
(13,838
)
$
(9,532
)
Stock-based compensation add back
3,425
1,824
Non-cash cumulative dividends on
redeemable convertible preferred stock
—
549
Non-GAAP net loss attributable to common
stockholders
$
(10,413
)
$
(7,159
)
GAAP net loss per share attributable to
common stockholders - basic and diluted
$
(0.21
)
$
(0.79
)
Non-GAAP net loss per share attributable
to common stockholders - basic and diluted
$
(0.16
)
$
(0.59
)
Weighted-average common shares outstanding
- basic and diluted
64,583,714
12,035,941
Adjusted EBITDA
Three Months Ended March
31,
2022
2021
Net loss
$
(13,838
)
$
(8,983
)
Interest on outstanding debt
293
280
Tax expense
32
—
Depreciation
685
430
Amortization
280
114
Stock-based compensation
3,425
1,824
Adjusted EBITDA
$
(9,123
)
$
(6,335
)
Free Cash Flow
Three Months Ended March
31,
2022
2021
Net cash used in operating activities
$
(4,171
)
$
(5,272
)
Less: Purchase of property and
equipment
(541
)
(1,782
)
Less: Capitalized internal-use
software
(367
)
(539
)
Free cash flow
$
(5,079
)
$
(7,593
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220504005366/en/
Investor Relations Contact
The Blueshirt Group ir@getweave.com
Media Contact Kali
Geldis Director of Communications pr@getweave.com
Weave Communications (NYSE:WEAV)
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