WalkMe Ltd. (NASDAQ:WKME), a leading provider of digital adoption
solutions, today announced financial results for its third quarter
ended September 30, 2022.
"I'm pleased to see as we continue to transition our business to
focus on large organizations with complex business processes that
our customers are not pausing their efforts to optimize their
organizations," said Dan Adika, CEO of WalkMe. "Our progress with
deploying WalkMe at scale is evidenced by our second quarter of
greater than 60% growth for our DAP customers while also improving
our operational efficiency and confident in our path to free cash
flow positive in 2023."
Third Quarter
2022 Financial
Highlights:
- Revenue: Total revenue was $63.4 million in
the third quarter of 2022, an increase of 25% year-over-year.
Subscription revenue was $56.7 million, an increase of 23%
year-over-year.
- Annualized Recurring Revenue (ARR)*: grew 26%
year-over-year to $254 million as of September 30, 2022.
- Remaining Performance
Obligation (RPO): was $351
million as of September 30, 2022, an increase of 29%
year-over-year.
- GAAP Operating
Loss: was $26.4 million in the third quarter of
2022, or 42% of total revenue, compared to $17.9 million, or 35% of
total revenue, in the third quarter of 2021.
- Non-GAAP Operating Loss*: was
$12.5 million in the third quarter of 2022 compared to $10.1
million in the third quarter of 2021 or 20% of total revenue.
- Cash Flow: Net cash used in
operations in the third quarter of 2022 was $9.7 million, or 15% of
total revenue, compared to $11.3 million used in operations or 22%
of total revenue, in the third quarter of 2021.
- Free Cash
Flow*: was negative $11.2 million in the third
quarter of 2022, or 18% of total revenue, compared to negative
$12.9 million, or 26% of total revenue, in the third quarter of
2021.
- Cash, Cash Equivalents,
and Short-term Deposits were
$309.2 million as of September 30, 2022.
"We're pleased to see ARR growth from customers with more than
500 employees grow by 31%, ahead of our total ARR growth while we
have worked to drive greater efficiencies within our organization,"
said Hagit Ynon, Interim CFO of WalkMe. "As a result of increased
focus on efficiency, we improved our non-GAAP operating loss margin
from 28% in Q2 2022 to 20% in Q3 2022. On this strength and
additional efficiencies we can drive, we have greater confidence in
our ability to achieve positive free cash flow within 2023."
Third Quarter and
Recent Business
Highlights:
- In the third quarter, WalkMe added thirteen net new
Enterprise-Wide DAP customers for a total of 155, representing DAP
customer count growth of 38% year-over-year. ARR from DAP customers
grew 63% year-over-year.
- Customers with over $100,000 in ARR grew 22% year-over-year to
511 and customers with over $1 million in ARR grew 30%
year-over-year to 35.
- In the fourth quarter of 2021, WalkMe updated and enhanced its
third-party data sources for identifying customers with 500 or more
employees and as a result now captures a greater number of
customers in this category in the same period compared to the
previous methodology. ARR from customers with 500 or more employees
grew 31% year-over-year and represented 89% of total ARR without
the new data sources. With the new data sources, ARR from customers
with 500 or more employees is now 94% of total ARR.
- WalkMe received approval to join the UK government's G-Cloud
Digital Marketplace, a centralized hub for the streamlined
procurement of cloud-related IT services and technologies by public
sector organizations such as central and local governments,
non-profit organizations, education, defense, and emergency and
health services.
- WalkMe expanded its partnership with Deloitte through a
strategic alliance with Deloitte Australia and Japan to bring
digital adoption best practices to Australian and Japanese
enterprises.
Financial Outlook:
For the fourth quarter of 2022, the Company currently
expects:
- Total revenue of $62.9 to $64.9 million, representing a growth
rate of 18% to 22% year-over-year
- Non-GAAP operating loss* of $13.2 to $11.2 million
For the full year 2022, the Company currently expects:
- Total revenue of $243 to $245 million, representing a growth
rate of 26% to 27% year-over-year
- Non-GAAP operating loss* of $61 to $59 million
*The section titled “Non-GAAP Financial Measures and Key
Performance Indicators” below contains a description of the
non-GAAP financial measures discussed in this press release and
reconciliations between historical GAAP and non-GAAP information
are contained in the tables below. The Company is unable to provide
a reconciliation of non-GAAP Operating Income (Loss) to Operating
Income (Loss), its most directly comparable GAAP financial measure,
on a forward-looking basis without unreasonable effort, because
items that impact this GAAP financial measure are not within the
Company’s control and/or cannot be reasonably predicted. These
items may include, but are not limited to, predicting
forward-looking share-based compensation. Such information may have
a significant, and potentially unpredictable, impact on the
Company’s future financial results.
Throughout this press release, we provide a number of key
performance indicators used by our management and often used by
competitors in our industry. These and other key performance
indicators are discussed in more detail in the section entitled
“Non-GAAP Financial Measures and Key Performance Indicators” in
this press release.
Conference Call
Information:
WalkMe will host a conference call and live webcast for analysts
and investors at 5:00 a.m. Pacific Time on November 15, 2022. The
press release with the financial results as well as the investor
presentation materials will be accessible from the Company’s
website prior to the conference call.
A live webcast of the conference call will be accessible on the
WalkMe investor relations website at https://ir.walkme.com.
Approximately one hour after completion of the live call and for
at least 30 days thereafter, an archived version of the webcast
will be available on the Company’s investor relations website at
https://ir.walkme.com.
Supplemental Financial
and Other Information:
We intend to announce material information to the public through
the WalkMe Investor Relations website at ir.walkme.com, SEC
filings, press releases, public conference calls, and public
webcasts. We use these channels to communicate with our investors,
customers, and the public about our company, our offerings, and
other issues. As such, we encourage investors, the media, and
others to follow the channels listed above, and to review the
information disclosed through such channels.
Any updates to the list of disclosure channels through which we
will announce information will be posted on the investor relations
page of our website.
Non-GAAP Financial
Measures and Key Performance Indicators:
In addition to our financial results reported in accordance with
GAAP, this press release and the accompanying tables and related
presentation materials may contain one or more of the following
non-GAAP financial measures: Non-GAAP Gross Profit, Non-GAAP Gross
Margin, Non-GAAP Operating Income (Loss), Non-GAAP Operating
Margin, Non-GAAP Net Income (Loss) attributable to WalkMe Ltd.,
Non-GAAP Net Income (Loss) per share attributable to WalkMe Ltd.
and Free Cash Flow, all of which are non-GAAP financial measures.
We believe that these measures provide useful information about
operating results, enhance the overall understanding of past
financial performance and future prospects, and allow for greater
transparency with respect to key measures used by management in its
financial and operational decision making. Non-GAAP financial
measures have limitations as analytical tools and may differ from
similarly titled measures presented by other companies. The
presentation of this financial information is not intended to be
considered as a substitute for the financial information prepared
and presented in accordance with GAAP. Investors are encouraged to
review the related GAAP financial measures and the reconciliation
of these non-GAAP financial measures to their most directly
comparable GAAP financial measures and not rely on any single
financial measure to evaluate our business.
Non-GAAP Gross Profit and Non-GAAP Gross Margin. We define
Non-GAAP Gross Profit as gross profit excluding share-based
compensation and amortization of acquired intangibles. We exclude
these items because they occur for reasons that may be unrelated to
our core operating performance during the period, and because we
believe that such items may obscure underlying business trends and
make comparisons of long-term performance difficult. We use
Non-GAAP Gross Profit with traditional GAAP measures to evaluate
our financial performance. Non-GAAP Gross Margin is calculated as a
percentage of revenues.
Non-GAAP Operating Income (Loss) and Non-GAAP Operating Margin.
We define Non-GAAP Operating Income (Loss) as income (loss) from
operations excluding share-based compensation and amortization and
impairment of acquired intangibles. We exclude these items because
they occur for reasons that may be unrelated to our core operating
performance during the period, and because we believe that such
items may obscure underlying business trends and make comparisons
of long-term performance difficult. We use Non-GAAP Operating
Income (Loss) with traditional GAAP measures to evaluate our
financial performance. Non-GAAP Operating Margin is calculated as a
percentage of revenues.
Non-GAAP Net Income (Loss) attributable to WalkMe Ltd. We define
Non-GAAP Net Income (Loss) attributable to WalkMe Ltd. as net
income (loss) attributable to WalkMe Ltd. excluding share-based
compensation, amortization and impairment of acquired intangibles
and adjustment attributable to non-controlling interest. We exclude
these items because they occur for reasons that may be unrelated to
our core operating performance during the period, and because we
believe that such items may obscure underlying business trends and
make comparisons of long-term performance difficult. We use
Non-GAAP Net Income (Loss) attributable to WalkMe Ltd. with
traditional GAAP measures to evaluate our financial performance.
Non-GAAP Net Income (Loss) per Share attributable to WalkMe Ltd. is
calculated based on ordinary shares outstanding after accounting
for the exchange of our outstanding convertible preferred shares
into ordinary shares as though such event had occurred at the
beginning of the periods.
Free Cash Flow. We define Free Cash Flow as net cash provided by
(used in) operating activities, less cash used for purchases of
property and equipment and capitalized internal-use software
development costs. We believe that Free Cash Flow is a useful
indicator of liquidity that provides information to management and
investors, even if negative, about the amount of cash used in our
business. Our Free Cash Flow may vary from period to period and be
impacted as we continue to invest for growth in our business.
For more information on the non-GAAP financial measures, please
see the reconciliation tables provided below. The accompanying
reconciliation tables have more details on the GAAP financial
measures that are most directly comparable to non-GAAP financial
measures and the related reconciliations between these financial
measures.
ARR. We define ARR as the annualized value of customer
subscription contracts as of the measurement date, assuming any
contract that expires during the next 12 months is renewed on its
existing terms (including contracts for which we are negotiating a
renewal). Our calculation of ARR is not adjusted for the impact of
any known or projected future events (such as customer
cancellations, upgrades or downgrades, or price increases or
decreases) that may cause any such contract not to be renewed on
its existing terms. In addition, the amount of actual revenue that
we recognize over any 12-month period is likely to differ from ARR
at the beginning of that period, sometimes significantly. This may
occur due to new bookings, cancellations, upgrades, downgrades or
other changes in pending renewals, as well as the effects of
professional services revenue and acquisitions or divestitures. As
a result, ARR should be viewed independently of, and not as a
substitute for or forecast of, revenue and deferred revenue. Our
calculation of ARR may differ from similarly titled metrics
presented by other companies.
Enterprise-Wide DAP Customers: We define Enterprise-Wide DAP
Customers as those who have purchased enterprise-wide subscriptions
or who have department-wide usage of our Digital Adoption Platform
across four or more applications.
Special Note Regarding
Forward-Looking Statements:
Certain statements in this press release may constitute
“forward-looking” statements and information, within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the
Securities Exchange Act of 1934, and the safe harbor provisions of
the U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to,
statements regarding our current expectations and views of future
events, statements regarding the Company’s future financial results
and guidance, and expectations regarding our revenue, operating
loss and free cash flow. In some cases, these forward-looking
statements can be identified by words or phrases such as “may,”
“might,” “will,” “could,” “would,” “should,” “expect,” “plan,”
“anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,”
“potential,” “continue,” “contemplate,” “possible” or similar
words. These forward-looking statements are subject to risks,
uncertainties and assumptions, some of which are beyond our
control. In addition, these forward-looking statements reflect our
current views with respect to future events and are not a guarantee
of future performance. Actual outcomes may differ materially from
the information contained in the forward-looking statements as a
result of a number of factors, including, without limitation, the
following: our ability to manage our growth effectively, sustain
our historical growth rate in the future or achieve or maintain
profitability; the impact of the COVID-19 pandemic or adverse
macro-economic changes on our business, financial condition and
results of operations; the growth and expansion of the markets for
our offerings and our ability to adapt and respond effectively to
evolving market conditions; our estimates of, and future
expectations regarding, our market opportunity; our ability to keep
pace with technological and competitive developments and develop or
otherwise introduce new products and solutions and enhancements to
our existing offerings; our ability to maintain the
interoperability of our offerings across devices, operating systems
and third-party applications and to maintain and expand our
relationships with third-party technology partners; the effects of
increased competition in our target markets and our ability to
compete effectively; our ability to attract and retain new
customers and to expand within our existing customer base; the
success of our sales and marketing operations, including our
ability to realize efficiencies and reduce customer acquisition
costs; the percentage of our remaining performance obligations that
we expect to recognize as revenue; our ability to meet the
service-level commitments under our customer agreements and the
effects on our business if we are unable to do so; our
relationships with, and dependence on, various third-party service
providers; our dependence on our management team and other key
employees; our ability to maintain and enhance awareness of our
brand; our ability to offer high quality customer support; our
ability to effectively develop and expand our marketing and sales
capabilities; our ability to maintain the sales prices of our
offerings and the effects of pricing fluctuations; the
sustainability of, and fluctuations in, our gross margin; risks
related to our international operations and our ability to expand
our international business operations; the effects of currency
exchange rate fluctuations on our results of operations; challenges
and risks related to our sales to government entities; our ability
to consummate acquisitions at our historical rate and at acceptable
prices, to enter into other strategic transactions and
relationships, and to manage the risks related to these
transactions and arrangements; our ability to protect our
proprietary technology, or to obtain, maintain, protect and enforce
sufficiently broad intellectual property rights therein; our
ability to maintain the security and availability of our platform,
products and solutions; our ability to comply with current and
future legislation and governmental regulations to which we are
subject or may become subject in the future; changes in applicable
tax law, the stability of effective tax rates and adverse outcomes
resulting from examination of our income or other tax returns;
risks related to political, economic and security conditions in
Israel; the effects of unfavorable conditions in our industry or
the global economy or reductions in information technology
spending; factors that may affect the future trading prices of our
ordinary shares; and other risk factors set forth in the section
titled “Risk Factors” in our Annual Report on form 20-F filed with
the Securities and Exchange Commission on March 24, 2022, and other
documents filed with or furnished to the SEC. These statements
reflect management’s current expectations regarding future events
and operating performance and speak only as of the date of this
press release. You should not put undue reliance on any
forward-looking statements. Although we believe that the
expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee that future results, levels of
activity, performance and events and circumstances reflected in the
forward-looking statements will be achieved or will occur. Except
as required by applicable law, we undertake no obligation to update
or revise publicly any forward-looking statements, whether as a
result of new information, future events or otherwise, after the
date on which the statements are made or to reflect the occurrence
of unanticipated events.
About WalkMe
WalkMe’s cloud-based Digital Adoption Platform enables
organizations to measure, drive and act to ultimately accelerate
their digital transformations and better realize the value of their
software investments. Our code-free platform leverages our
proprietary technology to provide visibility to an organization’s
Chief Information Officer and business leaders, while improving
user experience, productivity and efficiency for employees and
customers. Alongside walkthroughs and third-party integration
capabilities, our platform can be customized to fit an
organization’s needs.
Media Contact:Christina
Knittelpress@walkme.com
Investor Contact:John
Streppainvestors@walkme.com
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WalkMe Ltd. |
|
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|
|
|
Condensed Consolidated Statements of
Operations |
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|
|
|
|
|
|
(in
thousands, except share and per share data;
unaudited) |
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|
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|
|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
Subscription |
$ |
56,681 |
|
|
$ |
46,088 |
|
|
$ |
162,270 |
|
|
$ |
126,773 |
|
Professional services |
|
6,672 |
|
|
|
4,501 |
|
|
|
17,873 |
|
|
|
13,272 |
|
Total
revenues |
|
63,353 |
|
|
|
50,589 |
|
|
|
180,143 |
|
|
|
140,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues |
|
|
|
|
|
|
|
|
|
|
|
Subscription(1)(2) |
|
6,481 |
|
|
|
5,957 |
|
|
|
20,052 |
|
|
|
17,430 |
|
Professional services(1) |
|
7,096 |
|
|
|
5,761 |
|
|
|
21,383 |
|
|
|
16,250 |
|
Total
cost of revenues |
|
13,577 |
|
|
|
11,718 |
|
|
|
41,435 |
|
|
|
33,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
49,776 |
|
|
|
38,871 |
|
|
|
138,708 |
|
|
|
106,365 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
Research and development(1) |
|
13,909 |
|
|
|
11,800 |
|
|
|
45,504 |
|
|
|
33,776 |
|
Sales and marketing(1) |
|
45,801 |
|
|
|
31,885 |
|
|
|
130,993 |
|
|
|
86,425 |
|
General and administrative(1)(2) |
|
16,483 |
|
|
|
13,034 |
|
|
|
49,501 |
|
|
|
34,895 |
|
Total
operating expenses |
|
76,193 |
|
|
|
56,719 |
|
|
|
225,998 |
|
|
|
155,096 |
|
Operating
loss |
|
(26,417 |
) |
|
|
(17,848 |
) |
|
|
(87,290 |
) |
|
|
(48,731 |
) |
Financial income (expense), net |
|
1,241 |
|
|
|
(184 |
) |
|
|
2,368 |
|
|
|
(137 |
) |
Loss
before income taxes |
|
(25,176 |
) |
|
|
(18,032 |
) |
|
|
(84,922 |
) |
|
|
(48,868 |
) |
Income
taxes |
|
(942 |
) |
|
|
(771 |
) |
|
|
(2,100 |
) |
|
|
(1,973 |
) |
Net
loss |
|
(26,118 |
) |
|
|
(18,803 |
) |
|
|
(87,022 |
) |
|
|
(50,841 |
) |
Net loss
attributable to non-controlling interest |
|
(18 |
) |
|
|
(280 |
) |
|
|
(367 |
) |
|
|
(901 |
) |
Adjustment
attributable to non-controlling interest |
|
(3,010 |
) |
|
|
4,289 |
|
|
|
(12,642 |
) |
|
|
19,392 |
|
Net loss
attributable to WalkMe Ltd. |
$ |
(23,090 |
) |
|
$ |
(22,812 |
) |
|
$ |
(74,013 |
) |
|
$ |
(69,332 |
) |
Net loss per
share attributable to WalkMe Ltd. basic and diluted |
$ |
(0.27 |
) |
|
$ |
(0.27 |
) |
|
$ |
(0.87 |
) |
|
$ |
(1.69 |
) |
Weighted-average shares used in computing net loss per share
attributable to ordinary shareholders, basic and diluted |
|
85,508,974 |
|
|
|
83,347,949 |
|
|
|
84,739,275 |
|
|
|
41,022,927 |
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(1)Includes
share-based compensation expense as follows: |
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|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Cost of
subscription revenues |
$ |
293 |
|
|
$ |
165 |
|
|
$ |
832 |
|
|
$ |
307 |
|
Cost of
professional services |
|
782 |
|
|
|
376 |
|
|
|
2,054 |
|
|
|
690 |
|
Research and
development |
|
1,756 |
|
|
|
1,120 |
|
|
|
5,396 |
|
|
|
2,402 |
|
Sales and
marketing |
|
5,478 |
|
|
|
2,264 |
|
|
|
13,935 |
|
|
|
4,319 |
|
General and
administrative |
|
5,505 |
|
|
|
3,759 |
|
|
|
15,891 |
|
|
|
9,583 |
|
Total
share-based compensation expense |
$ |
13,814 |
|
|
$ |
7,684 |
|
|
$ |
38,108 |
|
|
$ |
17,301 |
|
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|
(2)Includes
amortization and impairment of acquired intangibles as
follows: |
|
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|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Cost of
revenues |
$ |
68 |
|
|
$ |
67 |
|
|
$ |
420 |
|
|
$ |
123 |
|
General and
administrative |
|
- |
|
|
|
- |
|
|
|
979 |
|
|
|
- |
|
Total
amortization and impairment |
$ |
68 |
|
|
$ |
67 |
|
|
$ |
1,399 |
|
|
$ |
123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WalkMe Ltd. |
Condensed Consolidated Balance Sheets |
(in thousands; unaudited) |
|
|
|
|
|
September
30, |
|
|
December
31, |
|
|
2022 |
|
|
|
2021 |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
$ |
194,900 |
|
|
$ |
276,889 |
|
Short-term
deposits |
|
114,272 |
|
|
|
65,478 |
|
Trade
receivables, net |
|
35,023 |
|
|
|
37,754 |
|
Deferred
contract acquisition costs |
|
23,809 |
|
|
|
20,405 |
|
Prepaid
expenses and other current assets |
|
8,175 |
|
|
|
7,954 |
|
Total
current assets |
|
376,179 |
|
|
|
408,480 |
|
|
|
|
|
|
|
Non-current
assets: |
|
|
|
|
|
|
|
|
|
|
|
Deferred
contract acquisition costs |
|
36,121 |
|
|
|
35,969 |
|
Other
assets |
|
515 |
|
|
|
987 |
|
Property and
equipment, net |
|
12,840 |
|
|
|
10,885 |
|
Operating
lease right-of-use assets |
|
8,089 |
|
|
|
- |
|
Goodwill and
Intangible assets, net |
|
1,897 |
|
|
|
3,296 |
|
Total
non-current assets |
|
59,462 |
|
|
|
51,137 |
|
|
|
|
|
|
|
Total assets |
$ |
435,641 |
|
|
$ |
459,617 |
|
|
|
|
|
|
|
Liabilities, redeemable non-controlling interest and
shareholders’ equity |
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Trade
payables |
$ |
4,506 |
|
|
$ |
6,592 |
|
Accrued
expenses and other current liabilities |
|
45,276 |
|
|
|
49,310 |
|
Deferred
revenues |
|
102,937 |
|
|
|
86,024 |
|
Total
current liabilities |
|
152,719 |
|
|
|
141,926 |
|
|
|
|
|
|
|
Long-term
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Deferred
revenues |
|
1,594 |
|
|
|
1,288 |
|
Other
long-term liabilities |
|
8,902 |
|
|
|
6,892 |
|
Operating
lease liabilities |
|
5,012 |
|
|
|
- |
|
Total
long-term liabilities |
|
15,508 |
|
|
|
8,180 |
|
Total
liabilities |
|
168,227 |
|
|
|
150,106 |
|
|
|
|
|
|
|
Redeemable
non-controlling interest |
|
10,564 |
|
|
|
23,901 |
|
Shareholders’ equity: |
|
|
|
|
|
Share
capital and additional paid-in capital |
|
671,757 |
|
|
|
610,193 |
|
Other
comprehensive income (loss) |
|
(3,214 |
) |
|
|
455 |
|
Accumulated
deficit |
|
(411,693 |
) |
|
|
(325,038 |
) |
Total
shareholders’ equity |
|
256,850 |
|
|
|
285,610 |
|
Total Liabilities, redeemable non-controlling interest and
shareholders’ equity |
$ |
435,641 |
|
|
$ |
459,617 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WalkMe Ltd. |
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Cash
Flow |
|
|
|
|
|
|
|
|
|
|
|
(in
thousands; unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Cash
flows from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
$ |
(26,118 |
) |
|
$ |
(18,803 |
) |
|
$ |
(87,022 |
) |
|
$ |
(50,841 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation |
|
13,814 |
|
|
|
7,684 |
|
|
|
38,108 |
|
|
|
17,301 |
|
Depreciation, amortization and impairment |
|
2,690 |
|
|
|
1,230 |
|
|
|
6,663 |
|
|
|
3,346 |
|
Operating
lease right-of-use assets and liabilities, net |
|
(392 |
) |
|
|
|
|
|
(392 |
) |
|
|
|
Interest on
short-term and long-term deposits |
|
(498 |
) |
|
|
(103 |
) |
|
|
(532 |
) |
|
|
(263 |
) |
Decrease
(increase) in trade receivables, net |
|
5,778 |
|
|
|
3,133 |
|
|
|
2,584 |
|
|
|
(6,478 |
) |
increase in
prepaid expenses and other current assets and other non-current
assets |
|
(568 |
) |
|
|
(2,974 |
) |
|
|
(709 |
) |
|
|
(4,224 |
) |
Increase in
deferred contract acquisition costs |
|
(630 |
) |
|
|
(5,323 |
) |
|
|
(3,805 |
) |
|
|
(16,554 |
) |
Decrease
(increase) in trade payables |
|
277 |
|
|
|
2,161 |
|
|
|
(1,787 |
) |
|
|
156 |
|
Increase
(decrease) in accrued expenses and other current liabilities |
|
(3,046 |
) |
|
|
1,904 |
|
|
|
(11,000 |
) |
|
|
8,113 |
|
Increase
(decrease) in deferred revenues |
|
(1,925 |
) |
|
|
(818 |
) |
|
|
17,873 |
|
|
|
27,842 |
|
Increase in
other long-term liabilities |
|
921 |
|
|
|
655 |
|
|
|
2,010 |
|
|
|
1,281 |
|
Net cash
used in operating activities |
|
(9,697 |
) |
|
|
(11,254 |
) |
|
|
(38,009 |
) |
|
|
(20,321 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of
property and equipment |
|
(635 |
) |
|
|
(547 |
) |
|
|
(2,673 |
) |
|
|
(1,375 |
) |
Investment
in short-term deposits |
|
(97,000 |
) |
|
|
(51,003 |
) |
|
|
(140,500 |
) |
|
|
(66,003 |
) |
Proceeds
from short-term deposits |
|
35,000 |
|
|
|
- |
|
|
|
92,257 |
|
|
|
37,287 |
|
Investment
in restricted deposits |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(1,298 |
) |
Proceeds
from restricted deposits |
|
- |
|
|
|
2,362 |
|
|
|
295 |
|
|
|
2,658 |
|
Capitalization of software development costs |
|
(879 |
) |
|
|
(1,101 |
) |
|
|
(3,064 |
) |
|
|
(2,723 |
) |
Net cash
provided by investing activities |
|
(63,514 |
) |
|
|
(50,289 |
) |
|
|
(53,685 |
) |
|
|
(31,454 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from initial public offering, net of underwriting discounts and
commissions and other issuance costs |
|
- |
|
|
|
(596 |
) |
|
|
- |
|
|
|
266,289 |
|
Proceeds
from exercise of options |
|
787 |
|
|
|
1,092 |
|
|
|
2,585 |
|
|
|
2,245 |
|
Proceeds
from employees share purchase plan |
|
1,489 |
|
|
|
- |
|
|
|
8,223 |
|
|
|
- |
|
Issuance of
preferred shares, net |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
10,000 |
|
Net cash
provided by financing activities |
|
2,276 |
|
|
|
496 |
|
|
|
10,808 |
|
|
|
278,534 |
|
Effect of
foreign currency exchange rate changes on cash, cash equivalents,
and restricted cash |
|
(319 |
) |
|
|
(105 |
) |
|
|
(1,145 |
) |
|
|
(544 |
) |
Increase
(decrease) in cash, cash equivalents and restricted cash |
|
(71,254 |
) |
|
|
(61,152 |
) |
|
|
(82,031 |
) |
|
|
226,215 |
|
Cash, cash
equivalents and restricted cash - Beginning of period |
|
266,474 |
|
|
|
350,262 |
|
|
|
277,251 |
|
|
|
62,895 |
|
Cash, cash
equivalents and restricted cash - End of period |
$ |
195,220 |
|
|
$ |
289,110 |
|
|
$ |
195,220 |
|
|
$ |
289,110 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WalkMe
Ltd. |
Reconciliation
from GAAP to Non-GAAP Results |
(in thousands,
except share and per share data; unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Reconciliation of gross profit and gross
margin |
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit |
$ |
49,776 |
|
|
$ |
38,871 |
|
|
$ |
138,708 |
|
|
$ |
106,365 |
|
Plus:
Share-based compensation expense |
|
1,075 |
|
|
|
541 |
|
|
|
2,886 |
|
|
|
997 |
|
Plus:
Amortization of acquired intangibles |
|
68 |
|
|
|
67 |
|
|
|
420 |
|
|
|
123 |
|
Non-GAAP
gross profit |
$ |
50,919 |
|
|
$ |
39,479 |
|
|
$ |
142,014 |
|
|
$ |
107,485 |
|
GAAP gross
margin |
|
79 |
% |
|
|
77 |
% |
|
|
77 |
% |
|
|
76 |
% |
Non-GAAP
gross margin |
|
80 |
% |
|
|
78 |
% |
|
|
79 |
% |
|
|
77 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of operating loss and operating
margin |
|
|
|
|
|
|
|
|
|
|
|
GAAP
operating loss |
$ |
(26,417 |
) |
|
$ |
(17,848 |
) |
|
$ |
(87,290 |
) |
|
$ |
(48,731 |
) |
Plus:
Share-based compensation expense |
|
13,814 |
|
|
|
7,684 |
|
|
|
38,108 |
|
|
|
17,301 |
|
Plus:
Amortization and impairment of acquired intangibles |
|
68 |
|
|
|
67 |
|
|
|
1,399 |
|
|
|
123 |
|
Non-GAAP
operating loss |
$ |
(12,535 |
) |
|
$ |
(10,097 |
) |
|
$ |
(47,783 |
) |
|
$ |
(31,307 |
) |
GAAP
operating margin |
|
(42 |
)% |
|
|
(35 |
)% |
|
|
(48 |
)% |
|
|
(35 |
)% |
Non-GAAP
operating margin |
|
(20 |
)% |
|
|
(20 |
)% |
|
|
(27 |
)% |
|
|
(22 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of net loss |
|
|
|
|
|
|
|
|
|
|
|
GAAP net
loss attributable to WalkMe Ltd. |
$ |
(23,090 |
) |
|
$ |
(22,812 |
) |
|
$ |
(74,013 |
) |
|
$ |
(69,332 |
) |
Plus:
Share-based compensation expense |
|
13,814 |
|
|
|
7,684 |
|
|
|
38,108 |
|
|
|
17,301 |
|
Plus:
Amortization and impairment of acquired intangibles |
|
68 |
|
|
|
67 |
|
|
|
1,399 |
|
|
|
123 |
|
Plus:
Adjustment attributable to non-controlling interest |
|
(3,010 |
) |
|
|
4,289 |
|
|
|
(12,642 |
) |
|
|
19,392 |
|
Non-GAAP net
loss attributable to WalkMe Ltd. |
$ |
(12,218 |
) |
|
$ |
(10,772 |
) |
|
$ |
(47,148 |
) |
|
$ |
(32,516 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
loss per share attributable to WalkMe Ltd. basic and diluted |
$ |
(0.14 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.56 |
) |
|
$ |
(0.42 |
) |
Shares used
in non-GAAP per share calculations: |
|
|
|
|
|
|
|
|
|
|
|
GAAP
weighted-average shares used to compute net loss per share, basic
and diluted |
|
85,508,974 |
|
|
|
83,347,949 |
|
|
|
84,739,275 |
|
|
|
41,022,927 |
|
Add: |
|
|
|
|
|
|
|
|
|
|
|
Additional
weighted average shares giving effect to exchange of convertible
preferred shares at the beginning of the period |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
36,202,004 |
|
Non-GAAP
weighted-average shares used to compute net loss per share, basic
and diluted |
|
85,508,974 |
|
|
|
83,347,949 |
|
|
|
84,739,275 |
|
|
|
77,224,931 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WalkMe
Ltd. |
Reconciliation
of GAAP Cash Flow from Operating Activities to Free Cash
Flow |
(in thousands;
unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
|
Nine months
ended |
|
|
September 30, |
|
|
September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net
cash used in operating activities |
$ |
(9,697 |
) |
|
$ |
(11,254 |
) |
|
$ |
(38,009 |
) |
|
$ |
(20,321 |
) |
Less:
Purchases of property and equipment |
|
(635 |
) |
|
|
(547 |
) |
|
|
(2,673 |
) |
|
|
(1,375 |
) |
Less:
Capitalized software development costs |
|
(879 |
) |
|
|
(1,101 |
) |
|
|
(3,064 |
) |
|
|
(2,723 |
) |
Free
Cash Flow |
$ |
(11,211 |
) |
|
$ |
(12,902 |
) |
|
$ |
(43,746 |
) |
|
$ |
(24,419 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
WalkMe (NASDAQ:WKME)
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From Feb 2024 to Mar 2024
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From Mar 2023 to Mar 2024