Domo Announces Fiscal 2020 Second Quarter Financial Results

Silicon Slopes, Utah – Domo, Inc. (Nasdaq: DOMO) today announced results for the fiscal 2020 second quarter ended July 31, 2019.

Fiscal Second Quarter Results

• Total revenue was $41.7 million, an increase of 22% year over year
• Subscription revenue was $34.9 million, an increase of 24% year over year
• Subscription revenue represented 84% of total revenue
• Billings were $38.8 million or 9% year-over-year growth
• Net cash used in operating activities was $18.7 million, an improvement of 48% year over year
• Subscription gross margin was 75%, an improvement of 4 percentage points from Q2 FY19
• GAAP operating margin improved by 59 percentage points year over year
• Non-GAAP operating margin improved by 40 percentage points year over year
• GAAP operating expenses decreased 14% year over year
• Non-GAAP operating expenses decreased 7% year over year
• GAAP net loss was $31.2 million, and GAAP net loss per share was $1.14, based on 27.4 million weighted-average shares outstanding
• Non-GAAP net loss was $26.4 million, and non-GAAP net loss per share was $0.96, based on 27.4 million weighted-average shares outstanding
• Cash, cash equivalents and short-term investments were $133.9 million as of July 31, 2019

Comments

“Our focus on empowering every business decision maker, from the frontline employee to the CEO, with actionable data is having a transformational impact on some of the world’s largest companies,” said Josh James, Domo founder and CEO. “While we continue to aggressively pursue our growth objectives, in Q2 we executed well on cost controls and improved our cash burn, and we remain committed to achieving cash flow positive status with the cash on our balance sheet.  As we look ahead, we are very optimistic about the opportunity in front of us.”

Recent Highlights

We believe the following points and accolades are additional indicators of what’s to come in our business through our commitment to product innovation and customer success:

• Domo announced Domo for Amazon Web Services (AWS). Domo for AWS is a purpose-built package that gives AWS customers an easy way to make data from nearly two dozen AWS services securely accessible to virtually anyone across the company to drive new business value.
• Domo announced a partnership with Zendesk to help customers better manage their IoT solutions and to offer a better, proactive service experience to their end users. As part of this partnership, the companies launched the Zendesk Customer Success for IoT App, an application built on top of the Domo IoT Cloud, to provide end-to-end management of data from device to end user.
• In the 2019 Forrester Wave for Vendor-Managed BI and Analytics Platforms, Domo generated one of the top reference customer feedback scores across all vendors evaluated in the Wave for Enterprise BI.
• Domo was named an Overall Leader in the Dresner Advisory Services Industry Excellence Awards for the third consecutive year based on high customer ratings for product quality, value delivered, sales and service.
• Constellation Research announced that Domo made its ShortLists for both Cloud-based BI and Analytics as well as Marketing Analytics Solutions.
• Utah Business named Domo an honoree in its first annual Living Color Awards, which recognizes companies that foster diversity and inclusion across the state of Utah.

Business Outlook

Based on information available as of September 5, 2019, Domo is providing the following guidance for Q3 and full year fiscal 2020:

Q3 Fiscal 2020

• Revenue is expected to be in the range of $41.5 million to $42.5 million
• Non-GAAP net loss per share is expected to be between $1.00 and $1.04 based on 27.7 million weighted-average shares outstanding

Full Year Fiscal 2020

• Revenue is expected to be in the range of $168.0 million to $169.0 million
• Non-GAAP net loss per share is expected to be between $4.00 and $4.10 based on 27.5 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 2020 second 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. A live dial-in is available domestically at (877) 491-5762 and internationally at (763) 416-6939, with conference ID#6087229. A replay will be available via webcast or at (855) 859-2056 or (404) 537-3406 until midnight (ET) September 19, 2019.

About Domo

Domo’s mission is to be the operating system for business, digitally connecting all your people, your data and your systems, empowering them to collaborate better, make better decisions and be more efficient, right from their phones. Domo works with many of the world’s leading and most progressive brands across multiple industries including retail, media and entertainment, manufacturing, finance and more. For more information about Domo (Nasdaq: DOMO), 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.

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 and adjusted net cash used in operating activities. 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 Q3 fiscal quarter and full fiscal year 2020, 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 15, 2019 and the Quarterly Report on Form 10-Q for the fiscal quarter ended July 31, 2019 expected to be filed with the SEC on or about September 11, 2019.  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.

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Domo is a registered trademark of Domo, Inc.