On May 23, 2024, Domo Inc (DOMO, Financial) released its 8-K filing for the fiscal first quarter ended April 30, 2024. Domo Inc provides a cloud-based platform that digitally connects all the data, systems, and people in an organization, giving them access to real-time data and insights and allowing them to manage their business from their smartphones. The company offers a platform to its customers as a subscription-based service.
Performance Overview
Domo Inc (DOMO, Financial) reported total revenue of $80.1 million for Q1 FY2025, surpassing the analyst estimate of $79.49 million. This marks a 1% year-over-year increase. Subscription revenue also grew by 1% year-over-year to $72.1 million. However, the company faced a decline in billings, which fell by 7% year-over-year to $65.5 million.
Despite the revenue growth, Domo Inc (DOMO, Financial) reported a GAAP net loss of $26.0 million, translating to a GAAP net loss per share of $0.69, which missed the analyst estimate of -$0.64. On a non-GAAP basis, the net loss was $12.3 million, or $0.33 per share.
Financial Achievements and Challenges
One of the notable achievements for Domo Inc (DOMO, Financial) was the positive net cash provided by operating activities, which amounted to $1.9 million. This is a significant indicator of the company's ability to generate cash from its core operations. However, the GAAP operating margin decreased by 2 percentage points year-over-year, and the non-GAAP operating margin decreased by 7 percentage points year-over-year, highlighting ongoing challenges in managing operational costs.
Income Statement Highlights
| Metric | Q1 FY2024 | Q1 FY2025 |
|---|---|---|
| Total Revenue | $79.5 million | $80.1 million |
| Subscription Revenue | $71.1 million | $72.1 million |
| Billings | $70.3 million | $65.5 million |
| GAAP Net Loss | $(24.4) million | $(26.0) million |
| Non-GAAP Net Loss | $(6.1) million | $(12.3) million |
Balance Sheet and Cash Flow
As of April 30, 2024, Domo Inc (DOMO, Financial) reported cash, cash equivalents, and restricted cash of $61.2 million. The company’s total assets stood at $204.4 million, while total liabilities were $367.9 million, resulting in a stockholders' deficit of $163.5 million. The company also reported a net cash increase of $219,000 for the quarter.
Commentary and Strategic Initiatives
“We’re hyper-focused on returning to growth, and feel optimistic about early signals from our strategic initiatives such as partner collaborations, consumption momentum and multi-use case customers,” said Josh James, founder and CEO. “Domo is a compelling solution for the current data and AI environment. We’re confident that our strategic priorities will continue to reinforce our competitive position.”
Analysis
Domo Inc (DOMO, Financial) has shown resilience in its revenue growth despite facing challenges in billings and operating margins. The company's focus on strategic initiatives and its ability to generate positive cash flow from operations are positive indicators for future performance. However, the widening net loss and declining operating margins suggest that the company needs to address its cost structure to achieve sustainable profitability.
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Explore the complete 8-K earnings release (here) from Domo Inc for further details.
