On December 5, 2024, Domo Inc (DOMO, Financial) released its 8-K filing for the fiscal third quarter ended October 31, 2024. Domo Inc, a provider of a cloud-based platform that connects data, systems, and people within organizations, reported a total revenue of $79.8 million, surpassing the analyst estimate of $77.54 million. However, the company reported a GAAP net loss per share of $0.48, which is more favorable compared to the estimated loss of $0.57 per share.
Company Overview
Domo Inc offers a subscription-based service that allows users to access real-time data and insights, enabling business management from smartphones. The platform is designed to integrate seamlessly with existing systems, providing notifications and facilitating immediate actions.
Performance and Challenges
Domo Inc's performance in the third quarter highlights both achievements and challenges. The company reported subscription revenue of $71.1 million and billings of $73.4 million. The Subscription Remaining Performance Obligations (RPO) increased by 3% year over year to $354.1 million, indicating a stable demand for its services. However, the company faced a GAAP operating margin of negative 14% and a net cash outflow from operating activities of $13.7 million, reflecting ongoing financial challenges.
Financial Achievements
The company's ability to exceed revenue expectations is significant in the competitive software industry, where innovation and customer retention are crucial. Domo Inc's recognition as a leader in various industry reports underscores its commitment to product innovation and customer value.
Income Statement and Key Metrics
The income statement reveals a total revenue of $79.8 million, with a gross profit of $59.8 million. Operating expenses totaled $70.9 million, leading to a loss from operations of $11.1 million. The company's non-GAAP operating margin was positive at 3%, highlighting efforts to manage costs effectively.
Balance Sheet and Cash Flow
As of October 31, 2024, Domo Inc reported cash and cash equivalents of $40.9 million. The balance sheet shows total assets of $190.2 million and total liabilities of $361.4 million, resulting in a stockholders' deficit of $171.2 million. The cash flow statement indicates a net decrease in cash of $14.8 million during the quarter.
Commentary and Outlook
“Our focus on ecosystem-led growth, consumption-based contracts and AI innovation is paying off with promising momentum, as we see more demand for Domo as an anchor technology in customers’ data stacks,” said Josh James, founder and CEO, Domo.
Analysis and Conclusion
Domo Inc's third-quarter results reflect a mixed performance, with revenue growth offset by continued losses. The company's strategic focus on AI and data integration positions it well for future opportunities, but financial sustainability remains a challenge. Investors will be keen to see how Domo Inc navigates these challenges in the coming quarters.
Explore the complete 8-K earnings release (here) from Domo Inc for further details.
