domo8k-20211202

Domo Announces Third Quarter Fiscal 2022 Financial Results

Silicon Slopes, Utah - December 2, 2021 - Domo, Inc. (Nasdaq: DOMO) today announced results for its fiscal third quarter ended October 31, 2021.

Fiscal Third Quarter Results

•Total revenue was $65.1 million, an increase of 21% year over year

•Subscription revenue was $56.6 million, an increase of 21% year over year

•Subscription revenue represented 87% of total revenue

•Billings were $70.2 million or 26% year-over-year growth

•Remaining Performance Obligations (RPO) was $296.9 million as of October 31, 2021, an increase of 19% year over year

•RPO expected to be recognized as revenue in the next twelve months was $190.6 million as of October 31, 2021, an increase of 24% year over year

•Net cash provided by operating activities was $0.03 million

•GAAP subscription gross margin was 81%, an improvement of 1 percentage point from Q3 FY21

•Non-GAAP subscription gross margin was 83%, an improvement of 2 percentage points from Q3 FY21

•GAAP operating margin declined by 3 percentage points year over year

•Non-GAAP operating margin improved by 6 percentage points year over year

•GAAP net loss was $28.5 million, and GAAP net loss per share was $0.88, based on 32.4 million weighted-average shares outstanding

•Non-GAAP net loss was $10.3 million, and non-GAAP net loss per share was $0.32, based on 32.4 million weighted-average shares outstanding

•Cash and cash equivalents were $84.2 million as of October 31, 2021

“We delivered strong results for the quarter, driven by continued market demand for our core modern BI solution and fueled by increasing demand for data-enabled apps to help our customers run their businesses on the Domo platform,” said Josh James, founder and CEO, Domo.

Recent Highlights

We believe the following recognition and research demonstrate our commitment to product innovation, go-to-market initiatives and customer success:

•Domo was named a Leader in Nucleus Research’s 2021 Value Matrix for Embedded Analytics Technology.

•Domo was named to Inc.’s first annual Best-Led Companies list — a select, data-driven list of the very strongest U.S. firms with revenue of $50 million to $2 billion.

•Domo was named to Constellation Research's ShortList™ for Cloud-Based Business Intelligence and Analytics Platforms for Q3 2021 and for Marketing Analytics Solutions for Q3 2021.

•Domo launched Sandbox, a new development and testing environment built on the Domo platform, to help customers more easily create and promote content into production across the enterprise.

Business Outlook

Based on information available as of December 2, 2021, Domo is providing the following guidance for its fourth fiscal quarter and full year fiscal 2022:

Q4 Fiscal 2022

•Revenue is expected to be in the range of $66.5 million to $67.5 million

•Non-GAAP net loss per share is expected to be between $0.37 and $0.41 based on 32.8 million weighted-average shares outstanding

Full Year Fiscal 2022

•Revenue is expected to be in the range of $254.5 million to $255.5 million

•Non-GAAP net loss per share is expected to be between $1.26 and $1.30 based on 32.0 million weighted-average shares outstanding

We have not reconciled guidance for non-GAAP metrics to their most directly comparable GAAP measures because such items that impact these measures are not within our control or cannot be reasonably predicted.

Earnings Call Details

Domo plans to host a conference call today to review its fiscal 2022 third quarter financial results and to discuss its financial outlook. The call is scheduled to begin at 3:00 p.m. MT/ 5:00 p.m. ET. A live webcast of the event will be available on the Domo Investor Relations website at https://www.domo.com/ir. Participants can register for the call in advance by visiting https://conferencingportals.com/event/zYvDlnjs. Instructions will be shared on how to join the call after registering.

A replay will be available at (800) 770-2030 or (647) 362-9199 with conference ID #41576 following the completion of the conference call until 11:59 p.m. (ET) December 16, 2021.

About Domo

Domo (Nasdaq: DOMO) is the Business Cloud, transforming the way business is managed by delivering Modern BI for AllTM. With Domo, critical processes that took weeks, months

or more can now be done on-the-fly, in minutes or seconds, at unbelievable scale. For more information, visit www.domo.com. You can also follow Domo on Twitter, Facebook and LinkedIn.

Domo Disclosure Channels to Disseminate Information

Domo investors and others should note that we announce material information to the public about our company, products and services, and other issues through a variety of means, including Domo's website, press releases, SEC filings, blogs and social media, in order to achieve broad, non-exclusionary distribution of information to the public. We intend to use the Domo Facebook page, the Domo LinkedIn page, the Domo blog, the @Domotalk Twitter account and the @JoshJames Twitter account as a means of disclosing information about the Company and its services and for complying with the disclosure obligations under Regulation FD. The information we post through these social media channels may be deemed material. Accordingly, we encourage investors and others to monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. The social media channels that we intend to use as a means of disclosing the information described here may be updated from time to time as listed on our investor relations webpage.

Use of Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP), we reference in this press release and the accompanying tables the following non-GAAP financial measures: billings, non-GAAP subscription gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, adjusted net cash used in operating activities, and free cash flow. In computing these measures, we exclude the effects of certain items including stock-based compensation expense, amortization of certain intangible assets, the reversal of contingent tax-related accruals and proceeds from shares issued in connection with employee stock purchase plan. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and our non-GAAP measures may be different from non-GAAP measures used by other companies.

We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses that may not be indicative of our ongoing core business operating results. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when analyzing historical performance and liquidity and planning, forecasting, and analyzing future periods.

For a reconciliation of these non-GAAP financial measures to GAAP measures, please see the tables captioned "Reconciliation of Non-GAAP Financial Measures" included at the end of this release.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding our future growth, demand for our products and services, our financial outlook for our fourth fiscal quarter and full fiscal year 2022, and results for future periods. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption "Risk Factors" and elsewhere in our filings with the U.S. Securities and Exchange Commission, including, without limitation, the Annual Report on Form 10-K filed with the SEC on April 1, 2021 and the Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2021 expected to be filed with the SEC on or about December 10, 2021, as well as risks to our business related to the COVID-19 pandemic. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update this information unless required by law.

# # #

Domo, Domo Business Cloud and Domo is the Business Cloud are registered trademarks of Domo, Inc.


Domo, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

	Three Months Ended				Nine Months Ended
	October 31,				October 31,
	2020		2021		2020		2021
Revenue:
Subscription	$	46,906	$	56,621	$	133,689	$	163,399
Professional services and other	6,739		8,460		19,648		24,569
Total revenue	53,645		65,081		153,337		187,968
Cost of revenue:
Subscription (1)	9,372		10,514		27,288		29,590
Professional services and other (1)	5,106		6,630		14,948		19,030
Total cost of revenue	14,478		17,144		42,236		48,620
Gross profit	39,167		47,937		111,101		139,348

Operating expenses:
Sales and marketing (1)	29,609		37,503		86,089		104,335
Research and development (1)	16,504		21,984		49,874		57,511
General and administrative (1), (2)	11,929		13,430		31,355		36,032
Total operating expenses	58,042		72,917		167,318		197,878
Loss from operations	(18,875)		(24,980)		(56,217)		(58,530)

Other expense, net (1)	(3,215)		(3,471)		(8,356)		(10,238)
Loss before income taxes	(22,090)		(28,451)		(64,573)		(68,768)
Provision for income taxes	131		62		446		89
Net loss	$	(22,221)	$	(28,513)	$	(65,019)	$	(68,857)

Net loss per share (basic and diluted)	$	(0.75)	$	(0.88)	$	(2.24)	$	(2.17)
Weighted-average number of shares (basic and diluted)	29,533		32,363		28,998		31,758


(1) Includes stock-based compensation expenses, as follows:
Cost of revenue:
Subscription	$	377	$	800	$	750	$	1,768
Professional services and other	273		563		494		1,168
Sales and marketing	3,301		6,718		7,670		15,192
Research and development	2,716		5,363		6,595		10,603
General and administrative	3,452		4,543		8,172		11,596
Other expense, net	172		176		267		524
Total stock-based compensation expenses	$	10,291	$	18,163	$	23,948	$	40,851

(2) Includes amortization of certain intangible assets, as follows:
General and administrative	$	20	$	20	$	60	$	60


Domo, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

	January 31,		October 31,
	2021		2021
Assets
Current assets:
Cash and cash equivalents	$	90,794	$	84,245

Accounts receivable, net	48,272		38,895
Contract acquisition costs	13,894		13,795
Prepaid expenses and other current assets	12,216		7,314
Total current assets	165,176		144,249

Property and equipment, net	14,745		16,998
Right-of-use assets	3,663		17,738
Contract acquisition costs, noncurrent	18,605		18,474
Intangible assets, net	3,356		2,895
Goodwill	9,478		9,478
Other assets	1,415		1,301
Total assets	$	216,438	$	211,133

Liabilities and stockholders' deficit
Current liabilities:
Accounts payable	$	1,085	$	12,021
Accrued expenses and other current liabilities	51,950		44,903
Lease liabilities	3,808		3,117
Current portion of deferred revenue	129,079		130,385
Total current liabilities	185,922		190,426

Lease liabilities, noncurrent	1,556		17,565
Deferred revenue, noncurrent	3,173		2,352
Other liabilities, noncurrent	9,637		10,495
Long-term debt	99,609		102,852
Total liabilities	299,897		323,690

Commitments and contingencies


Stockholders' deficit:
Common stock	30		32
Additional paid-in capital	1,038,006		1,077,993
Accumulated other comprehensive income	877		647
Accumulated deficit	(1,122,372)		(1,191,229)
Total stockholders' deficit	(83,459)		(112,557)
Total liabilities and stockholders' deficit	$	216,438	$	211,133


Domo, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

	Three Months Ended				Nine Months Ended
	October 31,				October 31,
	2020		2021		2020		2021
Cash flows from operating activities
Net loss	$	(22,221)	$	(28,513)	$	(65,019)	$	(68,857)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization	1,126		1,533		3,490		3,789
Non-cash lease expense	1,044		1,224		2,997		3,540
Amortization of contract acquisition costs	3,657		3,944		10,577		11,779
Stock-based compensation	10,291		18,163		23,948		40,851
Other, net	1,634		877		3,456		2,663
Changes in operating assets and liabilities:
Accounts receivable, net	(2,855)		(7,746)		10,179		9,377
Contract acquisition costs	(4,047)		(4,354)		(9,939)		(11,719)
Prepaid expenses and other assets	474		664		4,039		4,949
Accounts payable	2,991		4,652		2,397		10,965
Operating lease liabilities	(996)		(669)		(2,564)		(2,380)
Accrued and other liabilities	5,159		5,131		506		(5,972)
Deferred revenue	2,027		5,123		(3,487)		485
Net cash (used in) provided by operating activities	(1,716)		29		(19,420)		(530)

Cash flows from investing activities
Purchases of property and equipment	(1,105)		(1,547)		(4,259)		(4,965)
Purchases of securities available for sale	—		—		(11,149)		—
Proceeds from maturities of securities available for sale	4,900		—		29,200		—
Purchases of intangible assets	(6)		—		(111)		—

Net cash provided by (used in) investing activities	3,789		(1,547)		13,681		(4,965)

Cash flows from financing activities



Proceeds from shares issued in connection with employee stock purchase plan	3,099		—		6,748		4,133
Shares repurchased for tax withholdings on vesting of restricted stock	(194)		(1,280)		(717)		(8,858)

Proceeds from exercise of stock options	446		745		2,505		3,908


Net cash provided by (used in) financing activities	3,351		(535)		8,536		(817)
Effect of exchange rate changes on cash and cash equivalents	(66)		(75)		173		(237)
Net increase (decrease) in cash and cash equivalents	5,358		(2,128)		2,970		(6,549)
Cash and cash equivalents at beginning of period	78,455		86,373		80,843		90,794
Cash and cash equivalents at end of period	$	83,813	$	84,245	$	83,813	$	84,245


Domo, Inc.
Reconciliation of Non-GAAP Financial Measures
(in thousands, except per share data)
(unaudited)

	Three Months Ended						Nine Months Ended
	October 31,						October 31,
	2020			2021			2020			2021
Reconciliation of Subscription Gross Margin on a GAAP Basis to Subscription Gross Margin on a Non-GAAP Basis:
Revenue:
Subscription	$	46,906		$	56,621		$	133,689		$	163,399
Cost of revenue:
Subscription	9,372			10,514			27,288			29,590
Subscription gross profit on a GAAP basis	37,534			46,107			106,401			133,809
Subscription gross margin on a GAAP basis	80		%	81		%	80		%	82		%

Stock-based compensation	377			800			750			1,768
Subscription gross profit on a non-GAAP basis	$	37,911		$	46,907		$	107,151		$	135,577
Subscription gross margin on a non-GAAP basis	81		%	83		%	80		%	83		%

Reconciliation of Total Operating Expenses on a GAAP Basis to Total Operating Expenses on a Non-GAAP Basis:
Total operating expenses on a GAAP basis	$	58,042		$	72,917		$	167,318		$	197,878
Stock-based compensation	(9,469)			(16,624)			(22,437)			(37,391)
Amortization of certain intangible assets	(20)			(20)			(60)			(60)

Total operating expenses on a non-GAAP basis	$	48,553		$	56,273		$	144,821		$	160,427

Reconciliation of Operating Loss on a GAAP Basis to Operating Loss on a Non-GAAP Basis:
Operating loss on a GAAP basis	$	(18,875)		$	(24,980)		$	(56,217)		$	(58,530)
Stock-based compensation	10,119			17,987			23,681			40,327
Amortization of certain intangible assets	20			20			60			60

Operating loss on a non-GAAP basis	$	(8,736)		$	(6,973)		$	(32,476)		$	(18,143)

Reconciliation of Operating Margin on a GAAP Basis to Operating Margin on a Non-GAAP Basis:
Operating margin on a GAAP basis	(35)		%	(38)		%	(37)		%	(31)		%
Stock-based compensation	19			27			16			21


Operating margin on a non-GAAP basis	(16)		%	(11)		%	(21)		%	(10)		%

Reconciliation of Net Loss on a GAAP Basis to Net Loss on a Non-GAAP Basis:
Net loss on a GAAP basis	$	(22,221)		$	(28,513)		$	(65,019)		$	(68,857)
Stock-based compensation	10,291			18,163			23,948			40,851
Amortization of certain intangible assets	20			20			60			60

Net loss on a non-GAAP basis	$	(11,910)		$	(10,330)		$	(41,011)		$	(27,946)

Reconciliation of Net Loss per Share on a GAAP Basis to Net Loss per Share on a Non-GAAP Basis:
Net loss per share on a GAAP basis	$	(0.75)		$	(0.88)		$	(2.24)		$	(2.17)
Stock-based compensation	0.35			0.56			0.83			1.29


Net loss per share on a non-GAAP basis	$	(0.40)		$	(0.32)		$	(1.41)		$	(0.88)


Domo, Inc.
Reconciliation of Non-GAAP Financial Measures (Continued)
(in thousands, except per share data)
(unaudited)

	Three Months Ended				Nine Months Ended
	October 31,				October 31,
	2020		2021		2020		2021
Billings:
Total revenue	$	53,645	$	65,081	$	153,337	$	187,968
Add:
Deferred revenue (end of period)	103,075		130,385		103,075		130,385
Deferred revenue, noncurrent (end of period)	3,182		2,352		3,182		2,352
Less:
Deferred revenue (beginning of period)	(101,982)		(126,381)		(105,290)		(129,079)
Deferred revenue, noncurrent (beginning of period)	(2,248)		(1,233)		(4,454)		(3,173)
Increase (decrease) in deferred revenue (current and noncurrent)	2,027		5,123		(3,487)		485
Billings	$	55,672	$	70,204	$	149,850	$	188,453

Reconciliation of Net Cash (Used in) Provided by Operating Activities to Adjusted Net Cash Provided by (Used in) Operating Activities:
Net cash (used in) provided by operating activities	$	(1,716)	$	29	$	(19,420)	$	(530)
Proceeds from shares issued in connection with employee stock purchase plan	3,099		—		6,748		4,133
Adjusted net cash provided by (used in) operating activities	$	1,383	$	29	$	(12,672)	$	3,603

Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow:
Net cash (used in) provided by operating activities	$	(1,716)	$	29	$	(19,420)	$	(530)
Proceeds from shares issued in connection with employee stock purchase plan	3,099		—		6,748		4,133
Purchases of property and equipment	(1,105)		(1,547)		(4,259)		(4,965)
Free cash flow	$	278	$	(1,518)	$	(16,931)	$	(1,362)


☐			Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
☐			If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


Exhibit No.						Description
99.1						Press Release of Domo, Inc. dated December 2, 2021
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)