Release Date: May 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- QuoteMedia Inc (QMCI, Financial) has maintained a high client retention rate of approximately 97%, indicating strong customer loyalty.
- Despite a flat quarter, the company successfully closed new contracts and expanded existing ones, effectively replacing lost revenue and achieving near breakeven results.
- QuoteMedia Inc (QMCI) is developing new products, with announcements expected soon, which could drive future revenue growth.
- The company has a robust pipeline with potential large deals that could significantly impact revenue positively once closed.
- QuoteMedia Inc (QMCI) continues to invest in software development, enhancing its product offerings and potentially leading to future revenue growth.
Negative Points
- QuoteMedia Inc (QMCI) experienced a flat quarter in Q1 2024, with a 1% decrease in total revenue compared to the previous year.
- Several medium-sized firms discontinued using QuoteMedia Inc (QMCI)'s services, contributing to the revenue decline.
- The company reported a net loss of $28,000 for the quarter, a decrease from a net income of $113,000 in the same quarter the previous year.
- Gross margin percentage decreased by 1% due to lower revenue, impacting overall profitability.
- Operating expenses increased by 4% due to additional personnel hired for expansion objectives, which could pressure the bottom line if revenue growth does not offset these costs.
Q & A Highlights
Q: Can you elaborate on the number of clients lost this quarter and the impact on your client base?
A: David Shworan, CEO of QuoteMedia, explained that the company lost a significant client who decided to discontinue a business venture that was not proving profitable, leading to the termination of their contract. This was a major factor behind the flat revenue this quarter. He emphasized that such occurrences are rare and that QuoteMedia generally has a high client retention rate of about 97%.
Q: What percentage of your client base might be at risk due to similar business model failures?
A: David Shworan noted that while they track client engagement and product usage, the nature of their business means they cannot control external factors affecting their clients' success. He mentioned that economic conditions and market dynamics could influence client decisions, but reassured that the company is actively working on acquiring new clients and developing new products.
Q: How do you see the top line growing throughout the year based on the current pipeline?
A: David Shworan stated that while it's challenging to predict exact timelines for deal closures, especially with larger deals, QuoteMedia is optimistic about closing significant deals within the year. He highlighted that the company is replacing lost clients and expects these efforts to positively impact financial results soon.
Q: Can you discuss the impact of new product launches on your business strategy?
A: David Shworan shared excitement about upcoming product launches, indicating that these are expected to contribute significantly to the company's growth. He mentioned that these products are designed to meet specific client needs and are part of QuoteMedia's strategy to enhance its offerings and market competitiveness.
Q: What are your expectations for gross margin improvements and the role of proprietary data in achieving these?
A: David Shworan expressed confidence that gross margins would improve as the company continues to leverage its proprietary data sets, reducing reliance on third-party data. This strategic shift is expected to enhance profitability and allow QuoteMedia to offer more competitive and unique products to its clients.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
