Release Date: February 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Boardwalktech Software Corp (BWLKF, Financial) repositioned its go-to-market strategy, highlighting the competitive differentiation of its Boardwalk Intelligent Information Platform.
- The company expanded its channel partner program, signing 10 new partners, including major firms like TCS and ServiceNow.
- Boardwalktech successfully executed a roadmap with partners for its Velocity product at a top US bank, indicating strong traction in the financial services sector.
- The company launched its first business process outsourcing client, marking a significant milestone in expanding its market reach.
- Boardwalktech closed a $4 million line of credit facility, providing working capital flexibility to support its operations and growth initiatives.
Negative Points
- Boardwalktech Software Corp (BWLKF) experienced a revenue decline due to the loss of two customers, resulting in a $1 million decrease in annual recurring revenue.
- The company's total revenue for the third quarter decreased by 12% compared to the same period last year.
- License revenue decreased both sequentially and year-over-year due to expired licenses and customer reorganizations.
- Gross margin slightly decreased due to higher hosting expenses and lower revenue levels.
- The company reported a net loss for the third quarter, although it showed improvement over previous quarters.
Q & A Highlights
Q: Can you provide more details on the impact of losing two customers on your revenue?
A: Andy Duncan, CEO: The loss of two customers resulted in a decline of approximately $1 million in annual recurring revenue. This was not due to our product capabilities but rather due to mandated cuts and reorganizations at those customers. We anticipate re-engagements with these customers once their internal situations stabilize.
Q: How is the company addressing the revenue decline and what are the future growth prospects?
A: Andy Duncan, CEO: We are adding new professional services revenue and proof of concepts (POCs) to not only backfill the revenue gap but also to grow our annual recurring revenue. Our pipeline is stronger than ever, particularly with our Velocity and Unity Central products, and we expect higher growth rates going forward.
Q: What are the key financial highlights from the third quarter?
A: Charlie Glavin, CFO: Total revenue for the third quarter was $1.29 million, a 1% sequential increase but a 12% decrease year-over-year. Gross margin was 88.4%, and the net loss was $0.59 million, which is an improvement over previous quarters. We have recognized $900,000 in cost savings year-to-date.
Q: Can you elaborate on the company's partnership strategy and its impact?
A: Andy Duncan, CEO: We have expanded our channel partner program, signing 10 partners including TCS and ServiceNow. Our partners are now selling and generating new opportunities for us, particularly in the financial services sector. We have also expanded our partnership with Accenture to deploy Unity Central in new opportunities.
Q: What is the outlook for Boardwalktech as it moves into fiscal 2026?
A: Andy Duncan, CEO: We are optimistic about exiting fiscal 2025 and heading into fiscal 2026. Our addressable pipeline has scaled, and we have several engagements in later stages. We expect to see sustainable EBITDA positive quarters ahead and modest growth in annual recurring revenue.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
