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eGain Reports Growing Profitability in its Fiscal Second Quarter; New Logos Increase with AssistGPT AI Offering
المصدر: Nasdaq GlobeNewswire / 08 فبراير 2024 16:05:01 America/New_York
SUNNYVALE, Calif., Feb. 08, 2024 (GLOBE NEWSWIRE) -- eGain (Nasdaq: EGAN), a knowledge platform for customer engagement, today announced financial results for its fiscal 2024 second quarter ended December 31, 2023.
“Our AssistGPT offering helped us win new logos in the quarter," said Ashu Roy, eGain’s CEO. "We see growing interest in knowledge management as a foundation for effective Generative AI use in customer service.”
Fiscal 2024 Second Quarter Financial Highlights
- Total revenue was $23.8 million, down 7% year over year.
- GAAP net income was $2.2 million, or $0.07 per share on a basic and diluted basis, up from a GAAP net loss of $104,000, or $0.00 per share on a basic and diluted basis, in Q2 2023.
- Non-GAAP net income was $3.4 million, or $0.11 per share on a basic and diluted basis, up from a non-GAAP net income of $1.7 million, or $0.05 per share on a basic and diluted basis, in Q2 2023.
- Cash provided by operations was $7.7 million, or an operating cash flow margin of 32%.
- Total cash and cash equivalents were $86.8 million, up from $79.8 million in Q1 2024.
- Adjusted EBITDA was $3.8 million compared to $2.2 million in Q2 2023.
- Total shares purchased through the repurchase program were approximately 391,000 at an average cost per share of $6.39, totaling $2.5 million.
Fiscal 2024 First Six Months Financial Highlights
- Total revenue was $48.0 million, down 5% year over year.
- GAAP net income was $4.8 million, or $0.15 per share on a basic and diluted basis, compared to GAAP net loss of $120,000, or $0.00 per share on a basic and diluted basis, in the same period last year.
- Non-GAAP net income was $7.2 million, or $0.23 per share on a basic basis and $0.22 per share on a diluted basis, compared to non-GAAP net income of $3.7 million, or $0.12 per share on a basic basis and $0.11 per share on a diluted basis, in the same period last year.
- Adjusted EBITDA was $6.6 million compared to $3.8 million in the same period last year.
- Cash provided from operations was $15.8 million, or an operating cash flow margin of 33%.
Fiscal 2024 Third Quarter Financial Guidance
For the third quarter of fiscal 2024 ending March 31, 2024, eGain expects:
- Total revenue of between $22.6 million to $23.0 million.
- GAAP net income of $400,000 to $1.0 million, or $0.01 to $0.03 per share.
- Includes stock-based compensation expense of approximately $1.2 million.
- Includes depreciation and amortization of approximately $100,000.
- Non-GAAP net income of $1.6 million to $2.2 million, or $0.05 to $0.07 per share.
Fiscal 2024 Financial Guidance
For the fiscal 2024 full year ending June 30, 2024, eGain expects:
- Total revenue of between $92.0 million to $93.0 million.
- GAAP net income of $4.5 million to $5.0 million, or $0.14 to $0.16 per share.
- Includes stock-based compensation expense of approximately $4.8 million.
- Includes depreciation and amortization of approximately $500,000.
- Non-GAAP net income of $9.3 million to $9.8 million, or $0.29 to $0.31 per share.
Guidance Assumption:
- Weighted average shares outstanding are expected to be approximately 31.9 million for the third quarter of fiscal 2024 and 32.0 million for the full fiscal year 2024.
Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures as supplemental information relating to our operating results, including adjusted EBITDA and non-GAAP net income. Adjusted EBITDA is defined as net income (loss), adjusted for the impact of depreciation and amortization, stock-based compensation expense, interest income, income tax provision, other (expense) income, and severance and related charges. Non-GAAP net income measure is adjusted for stock-based compensation expense. eGain’s management has analyzed the effect of these non-GAAP adjustments on our income tax provision and believes the change in our income tax provision would be minimal due to these non-GAAP adjustments being attributed to the U.S. jurisdiction where it has recorded full valuation allowance against the deferred taxes. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, or GAAP, and may be different from non-GAAP measures used by other companies. eGain’s management uses these non-GAAP measures to compare our performance to that of prior periods for trend analysis and for budgeting and planning purposes. eGain believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in our financial and operational decision-making. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release. eGain urges investors to review the reconciliation and not to rely on any single financial measure to evaluate our business. In addition, this presentation includes eGain’s projected non-GAAP net income for future periods, a non-GAAP measure used to describe eGain’s expected performance. We have not presented a reconciliation to eGain’s projected net income, the most comparable GAAP financial measure, because the reconciliation could not be prepared without unreasonable effort. The information necessary to prepare the reconciliation is not available on a forward-looking basis and cannot be accurately predicted. The unavailable information could have a significant impact on the calculation of the comparable GAAP financial measure.
Conference Call Information
eGain will discuss its fiscal 2024 second quarter results today via a teleconference at 2:00 p.m. Pacific Time. To access the live call, dial 844-481-2704 (U.S. toll free) or +1 412-317-0660 (International) and ask to join the eGain earnings call. A live and archived webcast of the call will also be accessible on the “Investor relations” section of eGain’s website at www.egain.com. In addition, a phone replay of the conference call will be available starting two hours after the call and will remain in effect for one week. To access the phone replay, dial 877-344-7529 (U.S. toll free) or +1 412-317-0088 (International). The replay access code is 1867998.
About eGain
eGain Knowledge Hub automates and orchestrates customer engagement across touch points. Powered by AI and analytics, our secure cloud solution delivers personalized digital-first experiences, quick business value, and easy innovation. Visit www.egain.com for more info.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including without limitation: our financial guidance for the third quarter of fiscal 2024 and fiscal 2024 full year ending June 30, 2024; and our market opportunity. The achievement or success of the matters covered by such forward-looking statements, including future financial guidance, involves risks, uncertainties, and assumptions, many of which involve factors or circumstances that are beyond our control. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our actual results could differ materially from the results expressed or implied by the forward-looking statements we make, including our ability to achieve our targets for the third quarter of fiscal 2024 and fiscal 2024 full year ending June 30, 2024. The risks and uncertainties referred to above include, but are not limited to: risks to our business, operating results, and financial condition; risks associated with new product releases and new services and products features; risks that customer demand may fluctuate or decrease; risks that we are unable to collect unbilled contractual commitments, particularly in the current economic environment; risks that our lengthy sales cycles may negatively affect our operating results; currency risks; our ability to capitalize on customer engagement; risks related to our reliance on a relatively small number of customers for a substantial portion of our revenue; our ability to compete successfully and manage growth; our ability to develop and expand strategic and third party distribution channels; risks related to our international operations; our ability to continue to innovate; our strategy of making investments in sales to drive growth; general political or destabilizing events, including war, intensified international hostilities, conflict or acts of terrorism; the effect of legislative initiatives or proposals, statutory changes, governmental or other applicable regulations and/or changes in industry requirements, including those addressing data privacy, cyber-security and cross-border data transfers; and other risks detailed from time to time in eGain’s public filings, including eGain’s annual report on Form 10-K for the fiscal year ended June 30, 2023 and subsequent reports filed with the Securities and Exchange Commission, which are available on the Securities and Exchange Commission’s website at www.sec.gov. These forward-looking statements are based on current expectations and speak only as of the date hereof. We assume no obligation and do not intend to update these forward-looking statements, except as required by law.
eGain, the eGain logo, and all other eGain product names and slogans are trademarks or registered trademarks of eGain Corporation in the United States and/or other countries. All other company names and products mentioned in this release may be trademarks or registered trademarks of the respective companies.
MKR Investor Relations
Todd Kehrli or Jim Byers
Phone: 323-468-2300
Email: egan@mkr-group.comeGain Corporation
Condensed Consolidated Balance Sheets
(in thousands, except par value data)
(unaudited)December 31, June 30, 2023 2023 ASSETS Current assets: Cash and cash equivalents $ 86,833 $ 73,201 Restricted cash 7 7 Accounts receivable, less provision for credit losses of $109 and $237 as of December 31, 2023 and June 30, 2023, respectively 14,271 31,569 Costs capitalized to obtain revenue contracts, net 1,282 1,317 Prepaid expenses 2,157 2,466 Other current assets 1,175 1,268 Total current assets 105,725 109,828 Property and equipment, net 561 633 Operating lease right-of-use assets 2,200 2,797 Costs capitalized to obtain revenue contracts, net of current portion 2,003 2,318 Goodwill 13,186 13,186 Other assets, net 1,768 1,355 Total assets $ 125,443 $ 130,117 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 1,777 $ 2,044 Accrued compensation 5,842 7,697 Accrued liabilities 4,207 5,387 Operating lease liabilities 587 832 Deferred revenue 40,880 47,762 Total current liabilities 53,293 63,722 Deferred revenue, net of current portion 2,991 2,101 Operating lease liabilities, net of current portion 1,470 1,762 Other long-term liabilities 896 836 Total liabilities 58,650 68,421 Stockholders' equity: Common stock, par value $0.001 - authorized: 60,000 shares; issued: 32,462 and 32,268; outstanding: 31,202 and 31,482 shares as of December 31, 2023 and June 30, 2023, respectively 32 32 Additional paid-in capital 404,320 401,087 Treasury stock, at cost: 1,260 and 786 shares of common stock as of December 31, 2023 and June 30, 2023, respectively (8,778 ) (5,763 ) Notes receivable from stockholders (20 ) (97 ) Accumulated other comprehensive loss (2,101 ) (2,122 ) Accumulated deficit (326,660 ) (331,441 ) Total stockholders' equity 66,793 61,696 Total liabilities and stockholders' equity $ 125,443 $ 130,117 eGain Corporation
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)Three Months Ended Six Months Ended December 31, December 31, 2023 2022 2023 2022 Revenue: Subscription $ 21,996 $ 23,614 $ 44,319 $ 46,537 Professional services 1,819 1,986 3,672 3,826 Total revenue 23,815 25,600 47,991 50,363 Cost of revenue: Cost of subscription 5,109 4,424 10,156 8,402 Cost of professional services 1,881 2,328 3,672 4,632 Total cost of revenue 6,990 6,752 13,828 13,034 Gross profit 16,825 18,848 34,163 37,329 Operating expenses: Research and development 6,660 7,188 13,292 14,062 Sales and marketing 5,349 8,895 11,453 18,354 General and administrative 2,391 2,552 5,577 5,370 Total operating expenses 14,400 18,635 30,322 37,786 Income (loss) from operations 2,425 213 3,841 (457 ) Interest income 982 529 1,931 815 Other (expense) income, net (697 ) (545 ) (87 ) 265 Income before income tax provision 2,710 197 5,685 623 Income tax provision (525 ) (301 ) (904 ) (743 ) Net income (loss) $ 2,185 $ (104 ) $ 4,781 $ (120 ) Per share information: Earnings (loss) per share: Basic $ 0.07 $ (0.00 ) $ 0.15 $ (0.00 ) Diluted $ 0.07 $ (0.00 ) $ 0.15 $ (0.00 ) Weighted-average shares used in computation: Basic 31,179 32,018 31,329 31,975 Diluted 31,843 32,018 31,991 31,975 Summary of stock-based compensation included in costs and expenses above: Cost of revenue $ 284 $ 412 $ 581 $ 842 Research and development 367 553 764 1,124 Sales and marketing 197 292 356 823 General and administrative 347 514 702 1,047 Total stock-based compensation $ 1,195 $ 1,771 $ 2,403 $ 3,836 eGain Corporation
GAAP to Non-GAAP Reconciliation Table
(in thousands, except per share data)
(unaudited)Three Months Ended Six Months Ended December 31, December 31, 2023 2022 2023 2022 Income (loss) from operations $ 2,425 $ 213 $ 3,841 $ (457 ) Add: Stock-based compensation 1,195 1,771 2,403 3,836 Non-GAAP income from operations $ 3,620 $ 1,984 $ 6,244 $ 3,379 Three Months Ended Six Months Ended December 31, December 31, 2023 2022 2023 2022 Net income (loss) $ 2,185 $ (104 ) $ 4,781 $ (120 ) Add: Stock-based compensation 1,195 1,771 2,403 3,836 Non-GAAP net income $ 3,380 $ 1,667 $ 7,184 $ 3,716 Per share information: Non-GAAP earnings per share: Basic $ 0.11 $ 0.05 $ 0.23 $ 0.12 Diluted $ 0.11 $ 0.05 $ 0.22 $ 0.11 Weighted-average shares used in computation: Basic 31,179 32,018 31,329 31,975 Diluted 31,843 32,870 31,991 32,881 Three Months Ended Six Months Ended December 31, December 31, 2023 2022 2023 2022 Net income (loss) $ 2,185 $ (104 ) $ 4,781 $ (120 ) Add: Depreciation and amortization 97 125 204 251 Stock-based compensation expense 1,195 1,771 2,403 3,836 Interest income (982 ) (529 ) (1,931 ) (815 ) Provision for income taxes 525 301 904 743 Other (expense) income, net 697 545 87 (265 ) Severance and related charges 54 85 135 150 Adjusted EBITDA $ 3,771 $ 2,194 $ 6,583 $ 3,780 eGain Corporation
Other GAAP to Non-GAAP Supplemental Financial Information
(in thousands)
(unaudited)Three Months Ended
December 31,Growth Rates Constant Currency
Growth Rates [1]2023 2022 Revenue: SaaS revenue $ 21,947 $ 23,429 (6%) (8%) Legacy revenue 49 185 (74%) (77%) GAAP subscription 21,996 23,614 (7%) (8%) GAAP professional services 1,819 1,986 (8%) (9%) Total GAAP revenue $ 23,815 $ 25,600 (7%) (8%) SaaS and professional services revenue: SaaS revenue $ 21,947 $ 23,429 (6%) (8%) Professional Services 1,819 1,986 (8%) (9%) Total SaaS and professional services revenue $ 23,766 $ 25,415 (6%) (8%) Cost of Revenue: GAAP subscription $ 5,109 $ 4,424 Non-GAAP subscription $ 5,109 $ 4,424 GAAP professional services $ 1,881 $ 2,328 Add back: Stock-based compensation (284 ) (412 ) Non-GAAP professional services $ 1,597 $ 1,916 GAAP total cost of revenue $ 6,990 $ 6,752 Add back: Stock-based compensation (284 ) (412 ) Non-GAAP total cost of revenue $ 6,706 $ 6,340 6% 5% Gross Profit: Non-GAAP subscription $ 16,887 $ 19,190 Non-GAAP professional services 222 70 Non-GAAP gross profit $ 17,109 $ 19,260 (11%) (13%) Operating expenses: GAAP research and development $ 6,660 $ 7,188 Add back: Stock-based compensation expense (367 ) (553 ) Non-GAAP research and development $ 6,293 $ 6,635 (5%) (6%) GAAP sales and marketing $ 5,349 $ 8,895 Add back: Stock-based compensation expense (197 ) (292 ) Non-GAAP sales and marketing $ 5,152 $ 8,603 (40%) (42%) GAAP general and administrative $ 2,391 $ 2,552 Add back: Stock-based compensation expense (347 ) (514 ) Non-GAAP general and administrative $ 2,044 $ 2,038 0% 0% GAAP operating expenses $ 14,400 $ 18,635 Add back: Stock-based compensation expense (911 ) (1,359 ) Non-GAAP operating expenses $ 13,489 $ 17,276 (22%) (23%) [1] Constant currency growth rates presented are derived from converting the current period results for entities reporting in currencies other than U.S. Dollars into U.S. Dollars at the exchange rates in effect during the prior period presented rather than the actual exchange rates in effect during the current period.
eGain Corporation
Other GAAP to Non-GAAP Supplemental Financial Information
(in thousands)
(unaudited)Six Months Ended
December 31,Growth Rates Constant Currency
Growth Rates [1]2023 2022 Revenue: SaaS revenue $ 44,203 $ 46,057 (4%) (6%) Legacy revenue 116 480 (76%) (78%) GAAP subscription 44,319 46,537 (5%) (6%) GAAP professional services 3,672 3,826 (4%) (5%) Total GAAP revenue $ 47,991 $ 50,363 (5%) (6%) SaaS and professional services revenue: SaaS revenue $ 44,203 $ 46,057 (4%) (6%) Professional Services 3,672 3,826 (4%) (5%) Total SaaS and professional services revenue $ 47,875 $ 49,883 (4%) (6%) Cost of Revenue: GAAP subscription $ 10,156 $ 8,402 Non-GAAP subscription $ 10,156 $ 8,402 GAAP professional services $ 3,672 $ 4,632 Add back: Stock-based compensation (581 ) (842 ) Non-GAAP professional services $ 3,091 $ 3,790 GAAP total cost of revenue $ 13,828 $ 13,034 Add back: Stock-based compensation (581 ) (842 ) Non-GAAP total cost of revenue $ 13,247 $ 12,192 9% 8% Gross Profit: Non-GAAP subscription $ 34,163 $ 38,135 Non-GAAP professional services 581 36 Non-GAAP gross profit $ 34,744 $ 38,171 (9%) (11%) Operating expenses: GAAP research and development $ 13,292 $ 14,062 Add back: Stock-based compensation expense (764 ) (1,124 ) Non-GAAP research and development $ 12,528 $ 12,938 (3%) (4%) GAAP sales and marketing $ 11,453 $ 18,354 Add back: Stock-based compensation expense (356 ) (823 ) Non-GAAP sales and marketing $ 11,097 $ 17,531 (37%) (38%) GAAP general and administrative $ 5,577 $ 5,370 Add back: Stock-based compensation expense (702 ) (1,047 ) Non-GAAP general and administrative $ 4,875 $ 4,323 13% 12% GAAP operating expenses $ 30,322 $ 37,786 Add back: Stock-based compensation expense (1,822 ) (2,994 ) Non-GAAP operating expenses $ 28,500 $ 34,792 (18%) (19%) [1] Constant currency growth rates presented are derived from converting the current period results for entities reporting in currencies other than U.S. Dollars into U.S. Dollars at the exchange rates in effect during the prior period presented rather than the actual exchange rates in effect during the current period.