Total second quarter revenue of $54.0 million,
up 73% from the same period a year ago
Largest year-over-year gross profit increase as
a public company, up 140% versus Q2 2020
Delivered 8.5 billion billable messages and
connected 1.4 billion voice calls
Closed Landmark Acquisition of Messaging
Solution Provider mGage along with strategic capital raise
Acquired Bandyer to Expand Communication
Solutions to include Programmable Video APIs
Kaleyra, Inc. (NYSE: KLR) (KLR WS) (“Kaleyra” or the “Company”),
a rapidly growing cloud communications software provider delivering
a secure system of application programming interfaces (APIs) and
connectivity solutions in the API/Communications Platform as a
Service (CPaaS) market, today announced financial results for the
second quarter ended June 30, 2021.
“Kaleyra reported another strong quarter, with Q2 exceeding our
revenue expectations along with significant improvement in our
gross margins. The team has continued to execute very well through
the closing of the mGage transaction as well as another challenging
period as the delta variant of COVID makes a resurgence,” commented
Dario Calogero, Kaleyra’s Founder and Chief Executive Officer. “The
second quarter was transformational for Kaleyra as we completed the
landmark acquisition of mGage as well as, immediately following the
closing of the second quarter, acquiring Bandyer. Through these
acquisitions we have accelerated our growth, expanded our
geographic reach and broadened our product portfolio. We have
already merged the mGage team into the Kaleyra family and are
pleased by the seamless integration. The strength of our business
and the team executing it give us confidence in our ability to
maintain momentum for the remainder of 2021 and support our vision
as a global CPaaS platform.”
Second Quarter 2021 Financial Highlights
- Revenue: Total revenue for the second quarter of 2021
was $54.0 million, a 73% increase when compared to $31.2 million in
the second quarter of 2020. During the one month that it was part
of Kaleyra, mGage contributed $10.2 million in the second quarter
revenue.
- Gross Profit: Gross profit for the second quarter of
2021 was $10.5 million, a 140% increase when compared to $4.4
million for the second quarter of 2020, and our largest
year-over-year gross profit increase as a public company. Gross
margin for the second quarter of 2021 was 19% versus 14% in the
second quarter of 2020.
- Adjusted Gross Profit: Adjusted gross profit for the
second quarter of 2021 was $11.1 million, a 147% increase when
compared to $4.5 million for the second quarter of 2020. Adjusted
gross margin for the second quarter of 2021 was 21% versus 14% in
the second quarter of 2020. The main drivers of the gross margin
increase were the organic expansion of gross profitability for
Kaleyra legacy businesses, representing 81% of the year-over-year
increase, and the revised product mix due to the acquisition of
mGage.
- Net Loss: Net loss for the second quarter of 2021 was
$(4.5) million, or $(0.13) per share, based on 34.3 million
weighted-average shares outstanding, predominantly due to one-time
expenses pertaining to the mGage acquisition and non-cash
stock-based compensation expenses. During the second quarter of
2020, net loss was $(8.1) million, or $(0.39) per share, based on
20.6 million weighted-average shares outstanding.
- Adjusted Net Income (Loss): Adjusted net income for the
second quarter of 2021 was $0.5 million, or $0.01 per share basic
and diluted, based on 34.3 million weighted-average shares
outstanding basic and 44.9 million diluted, compared to adjusted
net loss of $(1.4) million, or $(0.07) per share, based on 20.6
million weighted-average shares outstanding in the second quarter
of 2020.
- Adjusted EBITDA: Adjusted EBITDA was $2.2 million for
the second quarter of 2021, compared to a loss $(0.3) million for
the second quarter of 2020. Kaleyra continues to strongly invest in
human capital, and in particular, in research and development
talent, enhancing the head count growth year over year to
strengthen the omni-channel platform, and continuous investment in
the global sales operations.
Recent Business Highlights
- Kaleyra delivered 8.5 billion billable messages, a 62% increase
from the year ago period, and connected 1.4 billion voice calls, up
195% from the year ago period.
- Kaleyra’s subsidiary, Campaign Registry Inc., has signed all
Tier 1 carriers in the US and multiple other carriers representing
estimated +98% of the US carrier market.
- Kaleyra was recognized as one of the top chatbot solution
providers by CIO Applications.
- In June, Kaleyra closed its landmark acquisition of mobile
messaging solution provider mGage to create a top-5 global CPaaS
platform with strong positions in the Americas, Europe and
Asia-Pacific.
- In conjunction with the mGage transaction, Kaleyra completed
strategic capital issuances of new securities that have been valued
at $305 million, consisting of $200 million of aggregate gross
principal amount of senior unsecured convertible notes due in 2026
and $105 million of gross proceeds from the issuance of Kaleyra
common stock in a Private Investment in Public Equity (PIPE)
transaction.
- In July, Kaleyra acquired Bandyer adding programmable video
APIs and SDK’s to Kaleyra’s communication solutions suite.
Financial Outlook
Kaleyra’s outlook takes into consideration that the Company’s
largest markets, Italy and India, will require a continued
monitoring of the outcome of the COVID-19 pandemic. It also
reflects the pure organic growth of Kaleyra and takes into
consideration the mGage and Bandyer acquisitions.
As of August 9, 2021, Kaleyra is providing guidance for its
third quarter and full year 2021 as follows:
- Third Quarter 2021 Guidance: Total revenue is expected
to be in the range of $79.5 - $80.5 million, absent an accelerated
wave of COVID-19 cases and shutdowns.
- Full Year 2021 Guidance: Total revenue is expected to be
in the range of $258 – $262 million, confirming the previously
communicated guidance, including the revenue from mGage since its
acquisition closed on June 1, 2021.
Quarterly Conference Call
Management will conduct an investor conference call today at
8:00 a.m. EST (5:00 a.m. PST) to discuss these results. Questions
will be taken after management’s presentation. A live webcast of
the call and the replay will be available in the Investors section
of the Kaleyra website at
https://investors.kaleyra.com/news-events/ir-calendar.
To Participate via Telephone: US: 877-407-0792
International: 201-689-8263 Conference ID: 13721720
Replay of the call: US: 844-512-2921 International:
412-317-6671 Start Date: Monday August 9, 2021, 11:00 a.m. ET End
Date: Monday August 22, 2021, 11:59 p.m. ET
About Kaleyra Inc.
Kaleyra, Inc. (NYSE American: KLR) (KLR WS), is a global group
providing mobile communication services for financial institutions
and enterprises of all sizes worldwide. Through its proprietary
platform, Kaleyra manages multi-channel integrated communication
services on a global scale, comprising of messages, push
notifications, e-mail, instant messaging, voice services and
chatbots. Kaleyra’s technology today makes it possible to safely
and securely manage billions of messages monthly with a reach to
hundreds of MNOs and over 190 countries. For more information:
https://www.kaleyra.com/.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements include, but are not
limited to, statements regarding the financial statements of
Kaleyra, its product and customer developments, its expectations,
hopes, beliefs, intentions, plans, prospects or strategies
regarding the future revenues and the business plans of Kaleyra’s
management team, the anticipated benefits of the acquisitions of
mGage and Bandyer by the Company, including the Company’s projected
future results and market opportunities following the acquisitions
of mGage and Bandyer, and the impact of the COVID-19 pandemic on
its business and financial performance. Any statements contained
herein that are not statements of historical fact may be deemed to
be forward-looking statements. In addition, any statements that
refer to projections, forecasts or other characterizations of
future events or circumstances, including any underlying
assumptions, are forward-looking statements. The words
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intends,” “may,” “might,” “plan,” “possible,” “potential,”
“predict,” “project,” “should,” “would” and similar expressions may
identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking. The
forward-looking statements contained in this press release are
based on certain assumptions and analyses made by the management of
Kaleyra in light of their respective experience and perception of
historical trends, current conditions and expected future
developments and their potential effects on Kaleyra as well as
other factors they believe are appropriate in the circumstances.
There can be no assurance that future developments affecting
Kaleyra will be those anticipated. These forward-looking statements
involve a number of risks, uncertainties (some of which are beyond
the control of the parties) or other assumptions that may cause
actual results or performance to be materially different from those
expressed or implied by these forward-looking statements, including
but not limited to: (i) risks that the mGage and Bandyer
transactions disrupt current plans and operations of mGage and
Bandyer, respectively and potential difficulties in mGage or
Bandyer employee retention as a result of the transactiona, (ii)
the price of Kaleyra’s securities may be volatile due to a variety
of factors, including changes in the competitive and highly
regulated industries in which Kaleyra, including mGage and Bandyer,
operates, variations in operating performance across competitors,
changes in laws and regulations affecting the Kaleyra’s, including
mGage’s and Bandyer’s, business and changes in the combined capital
structure, (iii) the ability to integrate mGage and Bandyer into
Kaleyra and implement business plans, forecasts, and other
expectations after the completion of the transaction, and identify
and realize additional opportunities, (iv) the risk of downturns
and a changing regulatory landscape in the highly competitive
healthcare industry, (v) the size and growth of the market in which
mGage operates, (vi) the mix of services utilized by Kaleyra’s
customers and such customers’ needs for these services, (vii)
market acceptance of new service offerings, (viii) the ability of
Kaleyra to expand what it does for existing customers as well as to
add new customers, (ix) that Kaleyra will have sufficient capital
to operate as anticipated, and (x) the impact that the novel
coronavirus and the illness, COVID-19, that it causes, as well as
governmental responses to deal with the spread of this illness and
the reopening of economies that have been closed as part of these
responses, may have on Kaleyra’s operations, the demand for
Kaleyra’s products, global supply chains and economic activity in
general. Should one or more of these risks or uncertainties
materialize or should any of the assumptions being made prove
incorrect, actual results may vary in material respects from those
projected in these forward-looking statements. We undertake no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.
Non-GAAP Financial Measure and Related Information
To provide investors and others with additional information
regarding Kaleyra’s results, the following non-GAAP financial
measures, not prepared in accordance with accounting principles
generally accepted in the United States (“GAAP”), are
disclosed:
- Non‑GAAP Adjusted Gross Profit and Non‑GAAP Adjusted Gross
Margin. For the periods presented, Kaleyra defines non‑GAAP gross
profit and non-GAAP gross margin as GAAP gross profit and GAAP
gross margin, respectively, adjusted to exclude, as applicable,
certain expenses as presented in the table below;
- Non-GAAP Adjusted EBITDA is defined as of any date of
calculation, as the consolidated pro forma earnings/(loss) of
Kaleyra and its subsidiaries, before finance income and finance
cost (including bank charges), tax, depreciation and amortization,
plus (i) transaction expenses, (ii) without duplication of clause
(i), severance or change of control payments, (iii) any expenses
related to company restructuring, (iv) the Adjusted EBITDA for
pre-acquisition period of subsidiaries, (v) any compensation
expenses relating to stock options, restricted stock units,
restricted stock or similar equity interests as may be issued by
Kaleyra or any of its subsidiaries to its or their employees and
(vi) any provision for the write down of assets;
- Non-GAAP Adjusted Net Income (Loss) Per Share, Basic and
Diluted. For the periods presented, Kaleyra defines non-GAAP net
income (loss) and non-GAAP net income (loss) per share, basic and
diluted, as GAAP net loss and GAAP net loss per share, basic and
diluted, respectively, adjusted to exclude, as applicable, certain
expenses presented in the table below.
Management uses the foregoing non-GAAP financial information,
collectively, to evaluate its ongoing operations and for internal
planning and forecasting purposes. Kaleyra’s management believes
that non-GAAP financial information, when taken collectively, may
be helpful to investors because it provides consistency and
comparability with past financial performance, facilitates
period-to-period comparisons of results of operations, and assists
in comparisons with other companies, many of which use similar
non-GAAP financial information to supplement their GAAP results.
Non-GAAP financial information is presented for supplemental
informational purposes only, should not be considered a substitute
for financial information presented in accordance with generally
accepted accounting principles, and may be different from
similarly-titled non-GAAP measures used by other companies.
Whenever Kaleyra uses a non-GAAP financial measure, a
reconciliation is provided to the most closely applicable financial
measure stated in accordance with GAAP. Investors are encouraged to
review the related GAAP financial measures and the reconciliation
of these non-GAAP financial measures to their most directly
comparable GAAP financial measures.
KALEYRA, INC. Condensed
Consolidated Balance Sheets (Unaudited, in thousands)
June 30, 2021
December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents
$
118,625
$
32,970
Short-term investments
6,099
4,843
Trade receivables, net
77,252
43,651
Prepaid expenses
3,850
1,447
Deferred costs
371
—
Other current assets
3,668
2,134
Total current assets
209,865
85,045
Property and equipment, net
15,939
6,726
Intangible assets, net
133,525
7,574
Goodwill
96,788
16,657
Deferred tax assets
—
703
Other long-term assets
313
1,797
Total Assets
$
456,430
$
118,502
LIABILITIES AND STOCKHOLDERS’ EQUITY
(DEFICIT)
Current liabilities:
Accounts payable
$
66,765
$
51,768
Debt for forward share purchase
agreements
—
483
Notes payable due to related parties
—
7,500
Lines of credit
5,338
5,273
Current portion of bank and other
borrowings
9,448
10,798
Deferred revenue
10,775
3,666
Payroll and payroll related accrued
liabilities
4,124
3,292
Other current liabilities
6,647
5,988
Total current liabilities
103,097
88,768
Long-term portion of bank and other
borrowings
28,611
31,974
Long-term portion of notes payable
189,238
2,700
Long-term portion of employee benefit
obligation
1,952
1,886
Deferred tax liabilities
1,792
—
Other long-term liabilities
1,667
603
Total Liabilities
326,357
125,931
Stockholders’ equity (deficit):
Common stock
4
3
Additional paid-in capital
245,452
93,628
Treasury stock, at cost
(30,431)
(30,431
)
Accumulated other comprehensive loss
(2,304)
(2,826
)
Accumulated deficit
(82,648)
(67,803
)
Total stockholders’ equity (deficit)
130,073
(7,429
)
Total liabilities and stockholders’ equity
(deficit)
$
456,430
$
118,502
KALEYRA, INC. Condensed
Consolidated Statements of Operations (Unaudited, in thousands,
except share and per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2021
2020
2021
2020
Revenue
$
53,992
$
31,199
$
93,706
$
64,832
Cost of revenue
43,529
26,846
76,919
55,748
Gross profit
10,463
4,353
16,787
9,084
Operating expenses:
Research and development
4,282
2,346
7,150
5,156
Sales and marketing
4,660
2,989
7,519
6,732
General and administrative
12,364
6,537
22,966
14,296
Total operating expenses
21,306
11,872
37,635
26,184
Loss from operations
(10,843)
(7,519
)
(20,848)
(17,100
)
Other income, net
47
11
92
53
Financial expense, net
(908)
(518
)
(1,627)
(559
)
Foreign currency income (loss)
(191)
(415
)
164
(247
)
Loss before income tax benefit
(11,895)
(8,441
)
(22,219)
(17,853
)
Income tax benefit
(7,408)
(313
)
(7,374)
(902
)
Net loss
$
(4,487)
$
(8,128
)
$
(14,845)
$
(16,951
)
Net loss per common share, basic and
diluted
$
(0.13)
$
(0.39
)
$
(0.46)
$
(0.84
)
Weighted-average shares used in computing
net loss per common share, basic and diluted
34,292,874
20,606,816
32,328,909
20,293,203
KALEYRA, INC. Condensed
Consolidated Statements of Cash Flows (Unaudited, in
thousands)
Six Months Ended June
30,
2021
2020
Cash Flows from Operating
Activities:
Net loss
$
(14,845
)
$
(16,951
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
3,460
1,269
Stock-based compensation, preference
shares and others
9,270
11,133
Non-cash settlement of preference share
liability
—
(2,486
)
Provision for doubtful accounts
808
44
Realized gains on marketable
securities
21
—
Employee benefit obligation
122
253
Change in fair value of warrant
liability
830
—
Reversal of accrued interest on forward
share purchase agreement
(659
)
—
Non-cash interest expense
325
117
Deferred taxes
(6,804
)
(636
)
Change in operating assets and
liabilities:
Trade receivables
(7,259
)
793
Other current assets
(2,359
)
1,938
Deferred costs
46
—
Other long-term assets
1,483
(448
)
Accounts payable
(1,882
)
(5,375
)
Other current liabilities
(2,508
)
5,059
Deferred revenue
6,920
171
Long-term liabilities
(82
)
698
Net cash used in operating activities
(13,113
)
(4,421
)
Cash Flows from Investing
Activities:
Purchase of short-term investments
(1,882
)
(4,920
)
Sale of short-term investments
546
5,041
Purchase of property and equipment
(177
)
(494
)
Sale of property and equipment
—
16
Capitalized software development costs
(1,633
)
(1,371
)
Purchase of intangible assets
(3
)
(6
)
Acquisition of mGage, net of cash
acquired
(195,709
)
—
Net cash used in investing activities
(198,858
)
(1,734
)
Cash Flows from Financing
Activities:
Proceeds from (repayments on) line of
credit, net
203
1,353
Borrowings on term loans
—
8,800
Repayments on term loans
(3,451
)
(5,741
)
Proceeds from issuance of convertible
notes, net of issuance costs
188,637
—
Repayments on notes
(7,500
)
(5,478
)
Repurchase of common stock in connection
with forward share purchase agreements
—
(24,218
)
Receipts (payments) related to forward
share purchase agreements
17,045
(620
)
Proceeds from issuance of common stock in
Private Investment in Public Equity offering, net of issuance
costs
99,051
32,680
Proceeds related to settlement of
non-forfeited 2020 Sponsor Earnout Shares
1,244
—
Proceeds from the exercise of common stock
warrants
2,872
—
Repayments on capital lease
(66
)
—
Net cash provided by financing
activities
298,035
6,776
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(409
)
(370
)
Net increase in cash, cash equivalents and
restricted cash
85,655
251
Cash, cash equivalents and restricted
cash, beginning of period
32,970
36,997
Cash, cash equivalents and restricted
cash, end of period
$
118,625
$
37,248
KALEYRA, Inc. Adjusted Gross
Profit and Adjusted Gross Margin Reconciliation of GAAP to Non-GAAP
Financial Information For the Three and the Six Months Ended June
30, 2021 and 2020 (Unaudited, in millions)
Three Months Ended June
30,
Six Months Ended June
30,
Adjusted Gross Profit and Adjusted
Gross Margin
2021
2020
2021
2020
Consolidated Gross Profit
$
10.5
$
4.4
$
16.8
$
9.1
Consolidated Gross Profit Margin
%
19.4%
14.0%
17.9%
14.0%
Amortization of acquired intangibles
0.7
0.2
0.8
0.3
Non-GAAP Gross Profit
$
11.1
$
4.5
$
17.6
$
9.4
Non-GAAP Gross Profit Margin %
20.6%
14.5%
18.8%
14.5%
KALEYRA, Inc. Adjusted EBITDA
Reconciliation of GAAP to Non-GAAP Financial Information For the
Three and the Six Months Ended June 30, 2021 and 2020 (Unaudited,
in millions)
Three Months Ended June
30,
Six Months Ended June
30,
Adjusted EBITDA
2021
2020
2021
2020
Net Loss
$
(4.5)
$
(8.1)
$
(14.8)
$
(17.0)
Other income, net
(0.0)
(0.0)
(0.1)
(0.1)
Financial expense, net
0.9
0.5
1.6
0.6
Foreign currency income (loss)
0.2
0.4
(0.2)
0.2
Income tax benefit
(7.4)
(0.3)
(7.4)
(0.9)
Loss from operations
$
(10.8)
$
(7.5)
$
(20.8)
$
(17.1)
Depreciation and amortization
2.6
0.6
3.5
1.3
Stock-based compensation, preference
shares and others
6.0
4.8
11.4
11.1
Transaction and one-off costs
4.5
1.8
7.0
4.2
Non-GAAP Adjusted EBITDA
$
2.2
$
(0.3)
$
1.0
$
(0.5)
KALEYRA, Inc. Adjusted Net
Income (Loss) per share Reconciliation of GAAP to Non-GAAP
Financial Information For the Three and the Six Months Ended June
30, 2021 and 2020 (Unaudited, in millions)
Three Months Ended June
30,
Six Months Ended June
30,
Adjusted Net Income (Loss) per
share
2021
2020
2021
2020
Net Loss
$
(4.5)
$
(8.1)
$
(14.8)
$
(17.0)
Stock-based compensation, preference
shares and others
6.0
4.8
11.4
11.1
Transaction and one-off costs
4.5
1.8
7.0
4.2
Amortization of acquired intangibles
1.8
0.4
2.2
0.8
Amortization of issuance costs for
convertible debt
0.2
0.0
0.2
0.0
Estimated tax effects of adjustments
(1)
(0.6)
(0.3)
(0.6)
(0.8)
Tax benefits related to reversal of
valuation allowance on discrete tax items
(6.8)
0.0
(6.8)
0.0
Non-GAAP Net Income (Loss)
$
0.5
$
(1.4)
$
(1.5)
$
(1.7)
Net Loss per share
Basic
$
(0.13)
$
(0.39)
$
(0.46)
$
(0.84)
Diluted
$
(0.13)
$
(0.39)
$
(0.46)
$
(0.84)
Non-GAAP Adjusted Net Income (Loss) per
share
Basic
$
0.01
$
(0.07)
$
(0.05)
$
(0.08)
Diluted
$
0.01
$
(0.07)
$
(0.05)
$
(0.08)
Weighted Average number of Shares
Outstanding (basic)
34,292,874
20,606,816
32,328,909
20,293,203
Weighted Average number of Shares
Outstanding (diluted)
44,946,532
20,606,816
32,328,909
20,293,203
(1) The Non-GAAP estimated tax effects of adjustments is
determined using the Effective Tax Rate (ETR) calculated for the
three months period, excluding discrete tax items.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210809005077/en/
Investor Contacts Marc P.
Griffin ICR, Inc. Marc.Griffin@icrinc.com ir@kaleyra.com
646-277-1290
Kaleyra (AMEX:KLR)
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