- Q1 Total Revenue of $196.0 million, up 13%
year-over-year
- Q1 Subscription Revenue of $177.4 million, up 12%
year-over-year
- Q1 net cash provided by operating activities of
$41.7 million and free cash flow* of $36.2 million
- RPO and cRPO up 30% and 19% year-over-year, respectively
- 138 $1 million customers, up 20% year-over-year
- Through May 31, 2024, 14,301,236 shares of Class A common
stock have been purchased under the 2024 Share Repurchase Program.
In June 2024, Board authorized an incremental $100 million to the
2024 Share Repurchase Program.
- Mr. Pham will be Co-CEO, partnering with Founder and Co-CEO
Ragy Thomas in an effort to drive growth and scale
Sprinklr (NYSE: CXM), the unified customer experience management
(Unified-CXM) platform for modern enterprises, today reported
financial results for its first fiscal quarter ended April 30,
2024.
"Despite operating in a more challenging macro environment, we
generated strong free cash flow in Q1 and we’re innovating with new
products and AI features. While the changes and initiatives we’re
implementing will take several quarters to work through, we believe
we have the right strategy and leaders in place. We believe that
the appointment of Trac Pham as Co-CEO will enable us to seamlessly
combine our technical innovation with operational leadership,” said
Ragy Thomas, Sprinklr Founder and Co-CEO.
First Quarter Fiscal 2025 Financial Highlights
- Revenue: Total revenue for the first quarter was $196.0
million, up from $173.4 million one year ago, an increase of 13%
year-over-year. Subscription revenue for the first quarter was
$177.4 million, up from $157.7 million one year ago, an increase of
12% year-over-year.
- Operating Income (Loss) and Margin*: First quarter GAAP
operating income was $5.7 million, compared to an operating loss of
$3.2 million one year ago. Non-GAAP operating income was $20.4
million, compared to non-GAAP operating income of $11.0 million one
year ago. For the first quarter, GAAP operating margin was 3% and
non-GAAP operating margin was 10% compared to GAAP operating margin
of (2)% and non-GAAP operating margin of 6% in the first quarter of
fiscal year 2024.
- Net Income Per Share*: First quarter GAAP net income per
share, diluted was $0.04, compared to net income per share, diluted
of $0.01 in the first quarter of fiscal year 2024. Non-GAAP net
income per share, diluted for the first quarter was $0.09, compared
to non-GAAP net income per share, diluted of $0.06 in the first
quarter of fiscal year 2024.
- Cash, Cash Equivalents and Marketable Securities: Total
cash, cash equivalents and marketable securities as of April 30,
2024 was $610.1 million.
* Free cash flow, non-GAAP operating income, non-GAAP operating
margin and non-GAAP net income per share are non-GAAP financial
measures defined under “Non-GAAP Financial Measures,” and are
reconciled to net cash provided by operating activities, operating
income (loss), net income or net income per share, as applicable,
the closest comparable GAAP measure, at the end of this
release.
Financial Outlook
Sprinklr is providing the following guidance for the second
fiscal quarter ending July 31, 2024:
- Subscription revenue between $177.5 million and $178.5
million.
- Total revenue between $194 million and $195 million.
- Non-GAAP operating income between $16.5 million and $17.5
million.
- Non-GAAP net income per share between $0.06 and $0.07, assuming
277 million diluted weighted-average shares outstanding.
Sprinklr is providing the following guidance for the full fiscal
year ending January 31, 2025:
- Subscription revenue between $714 million and $716
million.
- Total revenue between $779 million and $781 million.
- Non-GAAP operating income between $104 million and $105
million.
- Non-GAAP net income per share between $0.40 and $0.41, assuming
276 million diluted weighted-average shares outstanding.
Non-GAAP Financial Measures
In addition to our results determined in accordance with U.S.
GAAP, we believe that the following non-GAAP financial measures
associated with our condensed consolidated statements of operations
are useful in evaluating our operating performance:
- Non-GAAP gross profit and non-GAAP gross margin;
- Non-GAAP operating income and non-GAAP operating margin;
and
- Non-GAAP net income and non-GAAP net income per share.
We define these non-GAAP financial measures as the respective
U.S. GAAP measures, excluding, as applicable, stock-based
compensation expense and related charges and amortization of
acquired intangible assets. We believe that it is useful to exclude
stock-based compensation expense-related charges and amortization
of acquired intangible assets in order to better understand the
long-term performance of our core business and to facilitate
comparison of our results to those of peer companies over multiple
periods.
In addition, we believe that free cash flow is also a useful
non-GAAP financial measure. Free cash flow is defined as net cash
provided by operating activities less cash used for purchases of
property and equipment and capitalized internal-use software. We
believe that free cash flow is a useful indicator of liquidity as
it measures our ability to generate cash, or our need to access
additional sources of cash, to fund operations and investments. We
expect our free cash flow to fluctuate in future periods with
changes in our operating expenses and as we continue to invest in
our growth. We typically experience higher billings in the fourth
quarter compared to other quarters and experience higher
collections of accounts receivable in the first half of the year,
which results in a decrease in accounts receivable in the first
half of the year.
However, non-GAAP financial measures have limitations in their
usefulness to investors because they have no standardized meaning
prescribed by U.S. GAAP and are not prepared under any
comprehensive set of accounting rules or principles. In addition,
other companies, including companies in our industry, may calculate
similarly titled non-GAAP financial measures differently or may use
other measures to evaluate their performance, all of which could
reduce the usefulness of our non-GAAP financial measures as tools
for comparison. As a result, our non-GAAP financial measures are
presented for supplemental informational purposes only and should
not be considered in isolation or as a substitute for our
consolidated financial statements presented in accordance with U.S.
GAAP.
Sprinklr has not reconciled its financial outlook expectations
as to non-GAAP operating income or as to non-GAAP net income per
share to their respective most directly comparable U.S. GAAP
measures as a result of the high variability, complexity and low
visibility with respect to the charges excluded from these non-GAAP
measures, in particular, the measures and effects of stock-based
compensation expense specific to equity compensation awards that
are directly impacted by unpredictable fluctuations in our stock
price. We expect the variability of the above charges to have a
significant, and potentially unpredictable, impact on our future
U.S. GAAP financial results. Accordingly, reconciliation is not
available without unreasonable effort, although it is important to
note that these factors could be material to Sprinklr’s results
computed in accordance with U.S. GAAP.
Conference Call Information Sprinklr will host a
conference call today, June 5, 2024, to discuss first quarter
fiscal 2025 financial results, as well as the second quarter and
full year fiscal 2025 outlook, at 5:00 p.m. Eastern Time, 2:00 p.m.
Pacific Time. Investors are invited to join the webcast by
visiting: https://investors.sprinklr.com/. To access the call by
phone, dial 877-459-3955 (domestic) or 201-689-8588
(international). The conference ID number is 13746733. The webcast
will be available live, and a replay will be available following
completion of the live broadcast for approximately 90 days.
About Sprinklr Inc. Sprinklr is a leading enterprise
software company for all customer-facing functions. With advanced
AI, Sprinklr's unified customer experience management (Unified-CXM)
platform helps companies deliver human experiences to every
customer, every time, across any modern channel. Headquartered in
New York City with employees around the world, Sprinklr works with
more than 1,700 valuable enterprises — global brands like
Microsoft, P&G, Samsung and more than 60% of the Fortune 100.
Sprinklr's value to the enterprise is simple: We un-silo teams to
make customers happier.
Forward-Looking Statements This press release contains
express and implied “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995, including
statements regarding our financial outlook for the second quarter
and full year fiscal 2025, the benefits of Sprinklr technology and
features, the impact of our strategic initiatives on our business,
the potential benefits to our business of appointing Trac Pham as
our Co-CEO and the ability of customers to successfully implement
Sprinklr technology and accomplish their objectives. In some cases,
you can identify forward-looking statements by terms such as
“anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,”
“might,” “plan,” “project,” “will,” “would,” “should,” “could,”
“can,” “predict,” “potential,” “target,” “explore,” “continue,” or
the negative of these terms, and similar expressions intended to
identify forward-looking statements. By their nature, these
statements are subject to numerous uncertainties and risks,
including factors beyond our control, that could cause actual
results, performance, or achievement to differ materially and
adversely from those anticipated or implied in the statements,
including: our rapid growth may not be indicative of our future
growth; our revenue growth rate has fluctuated in prior periods;
our ability to achieve or maintain profitability; we derive the
substantial majority of our revenue from subscriptions to our
Unified-CXM platform; our ability to manage our growth and
organizational change; the market for Unified-CXM solutions is new
and rapidly evolving; our ability to attract new customers in a
manner that is cost-effective and assures customer success; our
ability to attract and retain customers to use our products; our
ability to drive customer subscription renewals and expand our
sales to existing customers; our ability to effectively develop
platform enhancements, introduce new products or keep pace with
technological developments; the market in which we participate is
new and rapidly evolving and our ability to compete effectively;
our business and growth depend in part on the success of our
strategic relationships with third parties; our ability to develop
and maintain successful relationships with partners who provide
access to data that enhances our Unified-CXM platform’s artificial
intelligence capabilities; the majority of our customer base
consists of large enterprises, and we currently generate a
significant portion of our revenue from a relatively small number
of enterprises; our investments in research and development; our
ability to expand our sales and marketing capabilities; our sales
cycle with enterprise and international clients can be long and
unpredictable; certain of our results of operations and financial
metrics may be difficult to predict; our ability to maintain data
privacy and data security; we rely on third-party data centers and
cloud computing providers; the sufficiency of our cash and cash
equivalents to meet our liquidity needs; our ability to comply with
modified or new laws and regulations applying to our business; our
ability to successfully enter into new markets and manage our
international expansion; the attraction and retention of qualified
employees and key personnel; our ability to effectively manage our
growth and future expenses and maintain our corporate culture; our
ability to maintain, protect, and enhance our intellectual property
rights; unstable market and economic conditions, including as a
result of increases in inflation rates, higher interest rates,
recent bank closures or instability, public health crises and
geopolitical actions, such as war and terrorism or the perception
that such hostilities may be imminent; and our ability to
successfully defend litigation brought against us. Additional risks
and uncertainties that could cause actual outcomes and results to
differ materially from those contemplated by the forward-looking
statements are or will be discussed in our Annual Report on Form
10-K for the year ended January 31, 2024, filed with the SEC on
March 29, 2024, under the caption “Risk Factors,” and in other
filings that we make from time to time with the SEC.
Forward-looking statements speak only as of the date the statements
are made and are based on information available to Sprinklr at the
time those statements are made and/or management’s good faith
belief as of that time with respect to future events. Sprinklr
assumes no obligation to update forward-looking statements to
reflect events or circumstances after the date they were made,
except as required by law.
Key Business Metrics
RPO. RPO, or remaining performance obligations,
represents contracted revenues that have not yet been recognized,
and include deferred revenue and amounts that will be invoiced and
recognized in future periods.
cRPO. cRPO, or current RPO, represents contracted
revenues that have not yet been recognized, and include deferred
revenue and amounts that will be invoiced and recognized in the
next 12 months.
Sprinklr, Inc.
Condensed Consolidated Balance
Sheets
(in thousands, except per
share data)
(unaudited)
April 30, 2024
January 31,
2024
Assets
Current assets:
Cash and cash equivalents
$
126,815
$
164,024
Marketable securities
483,264
498,531
Accounts receivable, net of allowance of
$6.2 million and $5.3 million, respectively
187,772
267,731
Prepaid expenses and other current
assets
85,969
70,690
Total current assets
883,820
1,000,976
Property and equipment, net
32,758
32,176
Goodwill and other intangible assets
50,086
50,145
Operating lease right-of-use assets
48,604
31,058
Other non-current assets
108,840
108,755
Total assets
$
1,124,108
$
1,223,110
Liabilities and stockholders’ equity
Liabilities
Current liabilities:
Accounts payable
$
19,163
$
34,691
Accrued expenses and other current
liabilities
64,271
93,187
Operating lease liabilities, current
6,661
5,730
Deferred revenue
370,229
374,552
Total current liabilities
460,324
508,160
Deferred revenue, non-current
710
506
Deferred tax liability, non-current
1,474
1,474
Operating lease liabilities,
non-current
44,932
27,562
Other liabilities, non-current
5,737
5,704
Total liabilities
513,177
543,406
Commitments and contingencies
Stockholders’ equity
Class A common stock
4
4
Class B common stock
4
4
Treasury stock
(23,831)
(23,831)
Additional paid-in capital
1,205,948
1,182,150
Accumulated other comprehensive loss
(5,224)
(3,836)
Accumulated deficit
(565,970)
(474,787)
Total stockholders’ equity
610,931
679,704
Total liabilities and stockholders’
equity
$
1,124,108
$
1,223,110
Sprinklr, Inc.
Condensed Consolidated
Statements of Operations
(in thousands, except per
share data)
(unaudited)
Three Months Ended April
30,
2024
2023
Revenue:
Subscription
$
177,363
$
157,665
Professional services
18,595
15,698
Total revenue
195,958
173,363
Costs of revenue:
Costs of subscription (1)
32,570
27,476
Costs of professional services (1)
18,555
14,461
Total costs of revenue
51,125
41,937
Gross profit
144,833
131,426
Operating expense:
Research and development (1)
22,539
20,761
Sales and marketing (1)
87,484
89,202
General and administrative (1)
29,101
24,656
Total operating expense
139,124
134,619
Operating income (loss)
5,709
(3,193)
Other income, net
7,500
4,759
Income before provision (benefit) for
income taxes
13,209
1,566
Provision (benefit) for income taxes
2,575
(1,242)
Net income
$
10,634
$
2,808
Net income per share, basic
$
0.04
$
0.01
Weighted average shares used in computing
net income per share, basic
271,664
265,584
Net income per share, diluted
$
0.04
$
0.01
Weighted average shares used in computing
net income per share, diluted
284,032
281,344
(1) Includes stock-based compensation expense, net of amounts
capitalized, as follows:
Three Months Ended April
30,
(in thousands)
2024
2023
Costs of subscription
$
283
$
300
Costs of professional services
317
403
Research and development
2,574
3,067
Sales and marketing
5,604
5,955
General and administrative
5,077
3,585
Stock-based compensation expense, net of
amounts capitalized
$
13,855
$
13,310
Sprinklr, Inc.
Condensed Consolidated
Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended April
30,
2024
2023
Cash flow from operating activities:
Net income
$
10,634
$
2,808
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization expense
4,508
3,519
Bad debt expense
1,038
159
Stock-based compensation, net of amounts
capitalized
13,855
13,310
Non-cash lease expense
1,949
907
Deferred income taxes
(339)
(3,323)
Net amortization/accretion on marketable
securities
(4,452)
(3,592)
Other non-cash items, net
79
—
Changes in operating assets and
liabilities:
Accounts receivable
78,646
28,138
Prepaid expenses and other current
assets
(15,824)
8,379
Other non-current assets
1,011
(171)
Accounts payable
(15,103)
(8,199)
Operating lease liabilities
(1,557)
(884)
Accrued expenses and other current
liabilities
(29,125)
(20,149)
Deferred revenue
(3,665)
(2,729)
Other liabilities
57
387
Net cash provided by operating
activities
41,712
18,560
Cash flow from Investing activities:
Purchases of marketable securities
(134,172)
(102,468)
Proceeds from sales and maturities of
marketable securities
153,097
78,199
Purchases of property and equipment
(2,545)
(1,625)
Capitalized internal-use software
(2,977)
(2,683)
Net cash provided by (used in) investing
activities
13,403
(28,577)
Cash flow from financing activities:
Proceeds from issuance of common stock
upon exercise of stock options
9,642
12,692
Payments for repurchase of Class A common
shares
(99,984)
—
Net cash (used in) provided by financing
activities
(90,342)
12,692
Effect of exchange rate fluctuations on
cash, cash equivalents and restricted cash
(1,231)
(196)
Net change in cash, cash equivalents and
restricted cash
(36,458)
2,479
Cash, cash equivalents and restricted cash
at beginning of period
172,429
188,387
Cash, cash equivalents and restricted cash
at end of period
$
135,971
$
190,866
Sprinklr, Inc.
Reconciliation of Non-GAAP
Measures
(in thousands)
(unaudited)
Three Months Ended April
30,
2024
2023
Non-GAAP gross profit and non-GAAP
gross margin:
U.S. GAAP gross profit
$
144,833
$
131,426
Stock-based compensation expense and
related charges (1)
607
712
Non-GAAP gross profit
$
145,440
$
132,138
Gross margin
74 %
76 %
Non-GAAP gross margin
74 %
76 %
Non-GAAP operating income:
U.S. GAAP operating income (loss)
$
5,709
$
(3,193)
Stock-based compensation expense and
related charges (2)
14,624
14,115
Amortization of acquired intangible
assets
50
50
Non-GAAP operating income
$
20,383
$
10,972
Operating margin
3 %
(2) %
Non-GAAP operating margin
10 %
6 %
Free cash flow:
Net cash provided by operating
activities
$
41,712
$
18,560
Purchase of property and equipment
(2,545)
(1,625)
Capitalized internal-use software
(2,977)
(2,683)
Free cash flow
$
36,190
$
14,252
(1) Employer payroll tax related to stock-based compensation for
the periods ended April 30, 2024 and 2023 was immaterial as it
relates to the impact to gross profit.
(2) Includes $0.8 million and $0.8 million of employer payroll
tax related to stock-based compensation expense for the three
months ended April 30, 2024 and 2023, respectively.
Three Months Ended April
30,
2024
2023
(in thousands)
Per Share- Basic
Per Share- Diluted
(in thousands)
Per Share- Basic
Per Share- Diluted
Non-GAAP net income reconciliation to
net income
Net income
$
10,634
$
0.04
$
0.04
$
2,808
$
0.01
$
0.01
Add:
Stock-based compensation expense and
related charges
14,624
0.05
0.05
14,115
0.05
0.05
Amortization of acquired intangible
assets
50
0.00
0.00
50
0.00
0.00
Total additions, net
14,674
0.05
0.05
14,165
0.05
0.05
Non-GAAP net income
$
25,308
$
0.09
$
0.09
$
16,973
$
0.06
$
0.06
Weighted-average shares outstanding used
in computing net income per share, basic
271,664
265,584
Weighted average shares outstanding used
in computing net income per share, diluted
284,032
281,344
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Investor Relations: ir@sprinklr.com
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