Yahoo Finance E2open Parent Holdings Inc (ETWO) Q4 2024 Earnings Call Transcript Highlights: Mixed Financial ...
Subscription Revenue (Q4 FY24): $134.4 million, above guidance range.
Year-over-Year Subscription Revenue Growth (FY24): 0.7% increase to $536.8 million.
Total Revenue (Q4 FY24): $158.5 million, a 4.7% decline year-over-year.
Total Revenue (FY24): $634.6 million, a 2.7% decline year-over-year.
Non-GAAP Gross Margin (Q4 FY24): 70.0%, slightly down from 70.2% year-over-year.
Non-GAAP Gross Margin (FY24): 69.4%, improvement from 68.7% year-over-year.
Adjusted EBITDA (Q4 FY24): $55.1 million, with a margin of 34.8%.
Adjusted EBITDA (FY24): $220.3 million, a 1.5% increase year-over-year.
Net Loss (Q4 FY24): $45.5 million.
Net Loss (FY24): $1.2 billion, including noncash goodwill impairment of $1.1 billion.
Adjusted Operating Cash Flow (Q4 FY24): $36.9 million.
Adjusted Operating Cash Flow (FY24): $116.0 million.
Cash and Cash Equivalents (End of FY24): $134.5 million, up $41.5 million year-over-year.
FY25 Subscription Revenue Guidance: $532 million to $542 million.
FY25 Total Revenue Guidance: $630 million to $645 million.
FY25 Adjusted EBITDA Guidance: $215 million to $225 million.
Release Date: April 29, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: From your perspective, what product areas are E2open leaning into to gain meaningful market share, and are there any that you are looking to deemphasize? A: (Gregory Randolph - Chief Commercial Officer) E2open has a broad and competitive range of product families that are marketable and capable of winning against the best point solution providers. The company does not plan to deemphasize any product areas as each category has strengths and drives growth.
Q: Between cross-selling, SI partners, and new logos, where do you expect more growth to come from? A: (Gregory Randolph - Chief Commercial Officer) All three areas are contributing to growth, but SI partnerships driving new logos have been the most effective in the past six months.
Q: How do you plan to address the path to normalized churn for the business, especially considering the historical gross retention rates? A: (Andrew Appel - CEO) The focus is on becoming a client-centric organization. There is nothing systemic preventing improvement; it's about managing more effectively. Marje Armstrong (CFO) added that they are tailoring approaches for different customer segments to effectively reduce churn.
Q: What are the plans for investment in sales capacity and achieving changes around the go-to-market teams and targeted SI investment? A: (Gregory Randolph - Chief Commercial Officer) E2open does not have a capacity problem but a productivity issue. The focus is on improving sales enablement, hiring top talent, and setting clear performance standards without needing to invest in more sales capacity.
Q: Given the changes made recently, what is the trend in sales productivity, and when do you expect to see stability and potential uptick? A: (Gregory Randolph - Chief Commercial Officer) There has been measurable improvement in in-quarter conversion rates and pipeline quality. The focus is on maintaining a high-quality pipeline to ensure continued improvement in conversion rates.
Q: Can you provide insights into the expected trajectory of churn and how it impacts the financial guidance for the upcoming quarters? A: (Marje Armstrong - Chief Financial Officer) Churn remains elevated due to decisions made over a year ago, impacting Q1. However, management practices have been put in place to reduce churn, which is expected to improve in the second half of the fiscal year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
