AVPT AvePoint Inc

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

"AvePoint delivered its eleventh consecutive record quarter with total revenue of $54 million and 79% year over year growth in subscription revenue for our SaaS and data management platform," said Dr. Tianyi Jiang (TJ), CEO and Co-Founder, AvePoint. "With most companies still in the early stages of their SaaS optimization and multi-cloud shifts, there is a massive market opportunity for AvePoint to manage and protect digital collaboration data on a recurring basis that will only increase as companies' SaaS operations become more mature and complex."

Third Quarter 2021 Financial Results

• Total Revenue of $53.9 million, up 36% year-over-year
• Total ARR of $147.5 million as of September 30, 2021, up 32% year-over-year
• SaaS Revenue of $22.4 million, up 59% year-over-year
• GAAP Operating Loss of $28.7 million
• Non-GAAP Operating Income of $4.0 million
• Cash and Short-Term Investments of approximately $262.3 million as of September 30, 2021

Third Quarter 2021 Key Highlights

• Launched first global partner program, designed to support the unique needs of different types of channel partners as they build services around digital collaboration.
• AvePoint was awarded a $37 million SGD ($27.5 million USD) contract from lead agency Temasek Polytechnic to deploy a training management platform for career professionals. The platform will be powered by AvePoint EduTech and will be available to six institutions of higher learning (IHL) for over 100,000 students.
• Maintained triple digit growth in monthly recurring revenue (MRR) tied to the managed services provider (MSP) business.
• Achieved record level sequential growth in accounts with over $100k in annual recurring revenue (ARR).

Financial Outlook

For the fourth quarter of 2021, AvePoint currently expects:

• Total revenues between $56.4 and $58.4 million
• Non-GAAP operating income between break even and $1.5 million

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

• Total revenues between $194.4 and $196.4 million
• Non-GAAP operating income between $4.7 and $6.2 million

Conference Call

AvePoint will host a conference call today on November 15, 2021 to review its third quarter 2021 financial results and to discuss its financial outlook. The call is scheduled to begin at 8:30am 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 AvePoint

Collaborate 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 Measures

To 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 Statements

This press release contains certain forward-looking statements within the meaning of the federal securities laws including statements regarding 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 AvePoint’s registration statement on Form S-1 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 give any assurance that it will achieve its expectations.

Investor Contacts:

AvePoint, Inc.Erica MannionSapphire Investor Relations, LLC.ir@avepoint.com617-542-6180

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

		For the Three Months Ended								For the Nine Months Ended
		September 30,								September 30,
		2021				2020				2021				2020
Revenue:
SaaS		$	22,410			$	14,092			$	61,255			$	36,034
Termed license and support			17,477				8,171				37,292				23,272
Services			8,143				10,870				21,361				26,173
Maintenance and OEM			5,293				6,056				16,160				17,837
Perpetual license			604				605				2,003				2,095
Total revenue			53,927				39,794				138,071				105,411
Cost of revenue:
SaaS			4,866				2,799				13,870				7,856
Termed license and support			211				437				714				1,257
Services			9,435				6,716				21,528				19,605
Maintenance and OEM			710				304				1,608				978
Total cost of revenue			15,222				10,256				37,720				29,696
Gross profit			38,705				29,538				100,351				75,715
Operating expenses:
Sales and marketing			25,186				21,830				73,488				49,881
General and administrative			22,230				10,469				44,186				20,918
Research and development			19,648				3,003				27,633				8,760
Depreciation and amortization			326				259				863				800
Total operating expenses			67,390				35,561				146,170				80,359
Loss from operations			(28,685	)			(6,023	)			(45,819	)			(4,644	)
Gain on earn-out and warrant liabilities			13,650				—				13,650				—
Interest income, net			56				17				80				26
Other income (expense), net			(299	)			65				(300	)			(324	)
Loss before income taxes			(15,278	)			(5,941	)			(32,389	)			(4,942	)
Income tax (benefit) expense			(5,521	)			6,244				(6,633	)			(72	)
Net loss		$	(9,757	)		$	(12,185	)		$	(25,756	)		$	(4,870	)
Net loss attributable to and accretion of redeemable noncontrolling interest			(517	)			—				(1,413	)			—
Net loss attributable to AvePoint, Inc.		$	(10,274	)		$	(12,185	)		$	(27,169	)		$	(4,870	)
Deemed dividends on preferred stock			608				(5,615	)			(32,928	)			(21,413	)
Net loss available to common shareholders		$	(9,666	)		$	(17,800	)		$	(60,097	)		$	(26,283	)
Loss per share:
Basic		$	(0.05	)		$	(0.20	)		$	(0.47	)		$	(0.30	)
Diluted		$	(0.05	)		$	(0.20	)		$	(0.47	)		$	(0.30	)
Shares used in computing loss per share:
Basic			176,621				90,805				126,738				86,784
Diluted			176,621				90,805				126,738				86,784

AvePoint, Inc. and SubsidiariesCondensed Consolidated Balance Sheets(In thousands, except par value)(Unaudited)

		September 30,				December 31,
		2021				2020
Assets
Current assets:
Cash and cash equivalents		$	260,704			$	69,112
Short-term investments			1,614				992
Accounts receivable, net of allowance of $878 and $1,767 at September 30, 2021 and December 31, 2020, respectively			54,226				48,250
Prepaid expenses and other current assets			13,086				2,343
Total current assets			329,630				120,697
Property and equipment, net			3,252				2,663
Deferred contract costs			35,267				31,943
Long-term unbilled receivables			6,104				5,499
Other assets			5,911				8,252
Total assets		$	380,164			$	169,054
Liabilities, mezzanine equity, and stockholders’ deficiency
Current liabilities:
Accounts payable		$	2,265			$	774
Accrued expenses and other liabilities			25,782				26,245
Current portion of deferred revenue			71,251				65,203
Total current liabilities			99,298				92,222
Long-term portion of deferred revenue			6,875				9,485
Share-based awards classified as liabilities			—				43,502
Earn-out liabilities			17,125				—
Warrant liabilities			795				—
Other non-current liabilities			3,947				3,658
Total liabilities			128,040				148,867
Commitments and contingencies (Note 10)
Mezzanine equity
Redeemable convertible preferred stock, $0.0001 par value; 94,695 shares authorized, 42,001 shares issued and outstanding with aggregate liquidation preference of $403,361 at December 31, 2020			—				183,390
Redemption value of common shares			—				25,074
Share-based awards classified as mezzanine equity			—				1,489
Redeemable noncontrolling interest			4,631				3,061
Total mezzanine equity			4,631				213,014
Stockholders’ deficiency
Common stock, $0.0001 par value; 1,000,000 and 243,360 shares authorized, 180,013 and 100,068 shares issued and outstanding, at September 30, 2021 and December 31, 2020, respectively			18				12
Additional paid-in capital			614,569				105,159
Treasury stock			(1,739	)			—
Accumulated other comprehensive income			1,892				1,791
Accumulated deficit			(367,247	)			(299,789	)
Total stockholders’ deficiency			247,493				(192,827	)
Total liabilities, mezzanine equity, and stockholders’ deficiency		$	380,164			$	169,054

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

		For the Nine Months Ended
		September 30,
		2021				2020
Operating activities
Net loss		$	(25,756	)		$	(4,870	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization			863				800
Foreign currency remeasurement (gain) loss			(161	)			368
Provision for doubtful accounts			(880	)			175
Stock-based compensation			50,475				16,235
Gain on disposal of property and equipment			(15	)			—
Deferred income taxes			(1,008	)			(1,973	)
Change in value of earn-out and warrant liabilities			(13,650	)			—
Changes in operating assets and liabilities:
Accounts receivable and long-term unbilled receivables			(7,002	)			(2,416	)
Prepaid expenses and other current assets			(10,775	)			2,836
Deferred contract costs and other assets			(3,269	)			(3,040	)
Accounts payable, accrued expenses and other liabilities			1,836				(1,949	)
Deferred revenue			5,377				4,965
Net cash provided by (used in) operating activities			(3,965	)			11,131
Investing activities
Maturity (purchase) of short-term investments			(638	)			1,466
Purchase of property and equipment			(1,445	)			(314	)
Net cash provided by (used in) investing activities			(2,083	)			1,152
Financing activities
Proceeds from recapitalization of Apex shares			491,563				—
Payments of transaction fees			(49,990	)			—
Redemption of redeemable convertible preferred stock			(130,925	)			(33,712	)
Redemption of Legacy AvePoint common stock			(106,169	)			—
Payments of transaction fees by Legacy AvePoint			(2,998	)			—
Purchase of treasury stock			(1,631	)			—
Payment of net cash settlement for management options			(7,530	)			—
Proceeds from stock option exercises			4,555				54
Proceeds from sale of common shares of subsidiary			753				—
Repayments of capital leases			(20	)			(42	)
Payments of debt issuance costs			—				(300	)
Proceeds from issuance of Common stock, net of issuance costs			—				56,753
Net cash provided by financing activities			197,608				22,753
Effect of exchange rates on cash			32				(329	)
Net increase in cash and cash equivalents			191,592				34,707
Cash and cash equivalents at beginning of period			69,112				12,162
Cash and cash equivalents at end of period		$	260,704			$	46,869
Supplemental disclosures of cash flow information
Cash received (paid) for:
Interest		$	80			$	—
Income taxes		$	(2,823	)		$	80
Non-cash investing and financing activities
Issuance of common shares in exchange for issuance cost		$	—			$	2,408
Fixed assets acquired under capital leases		$	—			$	28

AvePoint, Inc. and SubsidiariesNon-GAAP Reconciliations(In thousands)(Unaudited)

		For the Three Months Ended								For the Nine Months Ended
		September 30,								September 30,
			2021				2020				2021				2020
Non-GAAP operating income
GAAP operating income (loss)		$	(28,685	)		$	(6,023	)		$	(45,819	)		$	(4,644	)
Stock-based compensation expense			32,676				13,381				50,475				16,235
Non-GAAP operating income		$	3,991			$	7,358			$	4,656			$	11,591
Non-GAAP operating margin			7.4	%			18.5	%			3.4	%			11.0	%
Non-GAAP gross profit
GAAP gross profit		$	38,705			$	29,538			$	100,351			$	75,715
Stock-based compensation expense			2,428				214				2,790				316
Non-GAAP gross profit		$	41,133			$	29,752			$	103,141			$	76,031
Non-GAAP gross margin			76.3	%			74.8	%			74.7	%			72.1	%
Non-GAAP sales and marketing
GAAP sales and marketing		$	25,186			$	21,830			$	73,488			$	49,881
Stock-based compensation expense			(2,171	)			(7,917	)			(13,073	)			(9,227	)
Non-GAAP sales and marketing		$	23,015			$	13,913			$	60,415			$	40,654
Non-GAAP sales and marketing as a % of revenue			42.7	%			35.0	%			43.8	%			38.6	%
Non-GAAP general and administrative
GAAP general and administrative		$	22,230			$	10,469			$	44,186			$	20,918
Stock-based compensation expense			(13,020	)			(5,201	)			(19,375	)			(6,496	)
Non-GAAP general and administrative		$	9,210			$	5,268			$	24,811			$	14,422
Non-GAAP general and administrative as a % of revenue			17.1	%			13.2	%			18.0	%			13.7	%
Non-GAAP research and development
GAAP research and development		$	19,648			$	3,003			$	27,633			$	8,760
Stock-based compensation expense			(15,057	)			(49	)			(15,237	)			(196	)
Non-GAAP research and development		$	4,591			$	2,954			$	12,396			$	8,564
Non-GAAP research and development as a % of revenue			8.5	%			7.4	%			9.0	%			8.1	%