Significant improvement in profitability year
over year
Largest customer deployment now at 200,000 paid
seats
Revenues from customers spending $5,000 or more
grew 32% year over year
Asana, Inc. (NYSE: ASAN)(LTSE: ASAN), a leading work management
platform for organizations, today reported financial results for
its first quarter fiscal 2024 ended April 30, 2023.
“As organizations move rapidly to leverage the benefits of AI,
our partnerships with some of the largest most strategic companies
in the world will be instrumental in informing our product
roadmap," said Dustin Moskovitz, co-founder and chief executive
officer of Asana. “The Asana Work GraphⓇ brings together AI and
human collaboration, giving our customers a powerful platform to
manage and automate work within their organization.”
First Quarter Fiscal 2024 Financial Highlights
- Revenues: Revenues were $152.4 million, an increase of 26% year
over year.
- Operating Loss: GAAP operating loss was $65.2 million, or 43%
of revenues, an improvement year over year compared to GAAP
operating loss of $96.2 million, or 80% of revenues, in the first
quarter of fiscal 2023. Non-GAAP operating loss was $22.3 million,
or 15% of revenues, an improvement year over year compared to
non-GAAP operating loss of $54.7 million, or 45% of revenues, in
the first quarter of fiscal 2023.
- Net Loss: GAAP net loss was $61.5 million, compared to GAAP net
loss of $98.9 million in the first quarter of fiscal 2023. GAAP net
loss per share was $0.28, compared to GAAP net loss per share of
$0.52 in the first quarter of fiscal 2023. Non-GAAP net loss was
$18.5 million, compared to non-GAAP net loss of $57.4 million in
the first quarter of fiscal 2023. Non-GAAP net loss per share was
$0.09, compared to non-GAAP net loss per share of $0.30 in the
first quarter of fiscal 2023.
- Cash Flow: Cash flows from operating activities were negative
$14.6 million, compared to negative $41.1 million in the first
quarter of fiscal 2023. Free cash flow was negative $16.6 million,
compared to negative $42.2 million in the first quarter of fiscal
2023.
Business Highlights
- The number of customers spending $5,000 or more on an
annualized basis in Q1 grew to 19,864, an increase of 19% year over
year. Revenues from these customers in Q1 grew 32% year over
year.
- The number of customers spending $100,000 or more on an
annualized basis in Q1 grew to 510, an increase of 31% year over
year.
- Overall dollar-based net retention rate in Q1 was over
110%.
- Dollar-based net retention rate for customers with $5,000 or
more in annualized spend in Q1 was over 115%.
- Dollar-based net retention rate for customers with $100,000 or
more in annualized spend in Q1 was over 130%.
- Hired Ike Tateyama, as GM of Japan, and Veit Brücker, as GM of
DACH (Germany, Austria, and Switzerland) to continue to expand
footprint in regions.
- Announcing Asana Intelligence - our latest products and
partnerships focused on automating work, reducing team friction and
improving business outcomes with an expanded integration of
generative artificial intelligence technologies.
- Announced Asana Collaborative Intelligence for enterprise
customers with product updates that aid in real-time progress
insights and process standardization to accelerate business
success.
- Released fourth-annual Anatomy of Work Global Index, an
in-depth analysis into how work has evolved during a time of rapid
volatility – focusing this year on how collaboration and goals are
integral to creating positive business opportunities.
- Named to Inc. Magazine's Best Workplaces for the sixth year in
a row.
Financial Outlook
For the second quarter of fiscal 2024, Asana expects:
- Revenues of $157.5 million to $158.5 million, representing year
over year growth of 17%.
- Non-GAAP operating loss of $26.0 million to $24.0 million.
- Non-GAAP net loss per share of $0.12 to $0.11, assuming basic
and diluted weighted average shares outstanding of approximately
218 million.
For fiscal year 2024, Asana expects:
- Revenues of $640.0 million to $648.0 million, representing year
over year growth of 17% to 18%.
- Non-GAAP operating loss of $120.0 million to $110.0
million.
- Non-GAAP net loss per share of $0.55 to $0.50, assuming basic
and diluted weighted average shares outstanding of approximately
219 million.
These statements are forward-looking and actual results may
materially differ. Refer to the “Forward-Looking Statements”
section below for information on the factors that could cause
Asana’s actual results to materially differ from these
forward-looking statements.
A reconciliation of non-GAAP outlook measures to corresponding
GAAP measures is not available on a forward-looking basis without
unreasonable effort due to the uncertainty regarding, and the
potential variability of, many of these costs and expenses that may
be incurred in the future. Asana has provided a reconciliation of
GAAP to non-GAAP financial measures in the financial statement
tables for its first quarter of fiscal 2024 non-GAAP results
included in this press release.
Earnings Conference Call Information
Asana will hold a conference call and live webcast today to
discuss these results at 1:30 p.m. Pacific Time. A live webcast and
replay will be available on the Asana Investor Relations website
at: https://investors.asana.com. The conference call can also be
accessed by dialing (844) 200-6205, or +1 929-526-1599 (outside of
the US). The conference access code is 395746.
Forward-Looking Statements
This press release contains “forward-looking” statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that are based on management’s beliefs and assumptions and on
information currently available to management. Forward-looking
statements include, but are not limited to, statements about our
ability to execute on our current strategies, our technology and
brand position, Asana’s outlook for the second fiscal quarter and
the full fiscal year ending January 31, 2024, expected benefits of
our offerings, Asana’s market position, and potential market
opportunities. Forward-looking statements generally relate to
future events or Asana’s future financial or operating performance.
Forward-looking statements include all statements that are not
historical facts and in some cases can be identified by terms such
as “anticipate,” “expect,” “intend,” “plan,” “believe,” “continue,”
“could,” “potential,” “may,” “will,” “goal,” or similar expressions
and the negatives of those terms. However, not all forward-looking
statements contain these identifying words. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors, including factors beyond Asana’s control, that may cause
Asana’s actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. These risks include, but are not limited to, risks and
uncertainties related to: Asana’s ability to achieve future growth
and sustain its growth rate, Asana’s ability to attract and retain
customers and increase sales to its customers, Asana’s ability to
develop and release new products and services and to scale its
platform, including the successful integration of artificial
intelligence, Asana’s ability to increase adoption of its platform
through Asana’s self-service model, Asana’s ability to maintain and
grow its relationships with strategic partners, the highly
competitive and rapidly evolving market in which Asana
participates, Asana’s international expansion strategies, and the
impact of the COVID-19 pandemic and broader macroeconomic
conditions. Further information on risks that could cause actual
results to differ materially from forecasted results are included
in Asana’s filings with the SEC, including Asana’s Annual Report on
Form 10-K for the year ended January 31, 2023 and subsequent
filings with the SEC. Any forward-looking statements contained in
this press release are based on assumptions that Asana believes to
be reasonable as of this date. Except as required by law, Asana
assumes no obligation to update these forward-looking statements,
or to update the reasons if actual results differ materially from
those anticipated in the forward-looking statements.
Use of Non-GAAP Financial Measures
To supplement Asana’s consolidated financial statements, which
are prepared and presented in accordance with GAAP, Asana utilizes
certain non-GAAP financial measures to assist in understanding and
evaluating its core operating performance. In this release, Asana’s
non-GAAP gross profit, gross margin, operating expenses, operating
expenses as a percentage of revenue, operating loss, operating
margin, net loss, net loss per share, free cash flow are not
presented in accordance with GAAP and are not intended to be used
in lieu of GAAP presentations of results of operations. These
non-GAAP financial measures, which may be different from similarly
titled measures used by other companies, are presented to enhance
investors’ overall understanding of Asana’s financial performance
and should not be considered a substitute for, or superior to, the
financial information prepared and presented in accordance with
GAAP. Investors are encouraged to review the reconciliation of
these non-GAAP measures to their most directly comparable GAAP
financial measures which can be found in the accompanying financial
statements included with this press release.
Asana is presenting these non-GAAP financial measures because it
believes that these non-GAAP financial measures provide useful
information about its financial performance, enhance the overall
understanding of Asana’s past performance and future prospects,
facilitate period-to-period comparisons of operations against other
companies in Asana’s industry, and allow for greater transparency
with respect to important metrics used by Asana’s management for
financial and operational decision-making.
Asana believes excluding the following items from its non-GAAP
financial measures is useful to investors and others in assessing
Asana’s operating performance due to the following factors:
- Share-based compensation expenses. Although share-based
compensation is an important aspect of the compensation of our
employees and executives, management believes it is useful to
exclude share-based compensation expenses to better understand the
long-term performance of Asana’s core business and to facilitate
comparison of its results to those of peer companies.
- Employer payroll tax associated with RSUs. The amount of
employer payroll tax-related items on employee stock transactions
is dependent on Asana’s stock price and other factors that are
beyond its control and that do not correlate to the operation of
the business.
- Non-recurring expenses. Non-recurring expenses include costs
related to restructuring. Asana believes the exclusion of
non-recurring items provides useful supplemental information to
investors and facilitates the analysis of its operating results and
comparison of operating results across reporting periods.
There are a number of limitations related to the use of non-GAAP
financial measures as compared to GAAP financial measures,
including that the non-GAAP financial measures exclude stock-based
compensation expense, which has been, and will continue to be for
the foreseeable future, a significant recurring expense in Asana’s
business and an important part of its compensation strategy.
In addition to the non-GAAP financial measures outlined above,
Asana also uses the non-GAAP financial measure of free cash flow,
which is defined as net cash from operating activities less cash
used for purchases of property and equipment and capitalized
internal-use software costs, plus non-recurring expenditures such
as capital expenditures from the purchases of property and
equipment associated with the build-out of Asana’s corporate
headquarters and costs related to restructuring. Asana believes
free cash flow is an important liquidity measure of the cash that
is available, after capital expenditures and operational expenses,
for investment in its business and to make acquisitions. Asana
believes that free cash flow is useful to investors as a liquidity
measure because it measures Asana’s ability to generate or use
cash. There are a number of limitations related to the use of free
cash flow as compared to net cash from operating activities,
including that free cash flow includes capital expenditures, the
benefits of which are realized in periods subsequent to those when
expenditures are made.
Definitions of Business Metrics
Customers spending over $5,000 and $100,000 on an annualized
basis
We define customers spending over $5,000 and $100,000 as those
organizations on a paid subscription plan that had $5,000 or more,
or $100,000 or more in annualized GAAP revenues in a given quarter,
respectively, inclusive of discounts.
Dollar-based net retention rate
Asana’s reported dollar-based net retention rate equals the
simple arithmetic average of its quarterly dollar-based net
retention rate for the four quarters ending with the most recent
fiscal quarter. Asana calculates its dollar-based net retention
rate by comparing its revenues from the same set of customers in a
given quarter, relative to the comparable prior-year period. To
calculate Asana’s dollar-based net retention rate for a given
quarter, Asana starts with the revenues in that quarter from
customers that generated revenues in the same quarter of the prior
year. Asana then divides that amount by the revenues attributable
to that same group of customers in the prior-year quarter. Current
period revenues include any upsells and are net of contraction or
attrition over the trailing 12 months, but exclude revenues from
new customers in the current period. Asana expects its dollar-based
net retention rate to fluctuate in future periods due to a number
of factors, including the expected growth of its revenue base, the
level of penetration within its customer base, and its ability to
retain its customers.
About Asana
Asana helps organizations orchestrate their work, from small
projects to strategic initiatives. Headquartered in San Francisco,
CA, Asana has millions of users in over 200 countries and
territories. Global customers such as Amazon, Affirm, Japan
Airlines, and Sky rely on Asana to manage everything from company
objectives to digital transformation to product launches and
marketing campaigns. For more information, visit www.asana.com.
Disclosure of Material Information
Asana announces material information to its investors using SEC
filings, press releases, public conference calls, and on its
investor relations page of Asana’s website at
https://investors.asana.com. Asana uses these channels, as well as
social media, including its Twitter account (@asana), its blog
(blog.asana.com), its LinkedIn page
(www.linkedin.com/company/asana), its Instagram account (@asana),
and its Facebook page (www.facebook.com/asana/), to communicate
with investors and the public about Asana, its products and
services and other matters. Therefore, Asana encourages investors,
the media and others interested in Asana to review the information
it makes public in these locations, as such information could be
deemed to be material information.
ASANA, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per
share data)
(unaudited)
Three Months Ended April
30,
2023
2022
Revenues
$
152,411
$
120,646
Cost of revenues(1)
14,847
12,438
Gross profit
137,564
108,208
Operating expenses:
Research and development(1)
76,316
65,205
Sales and marketing(1)
93,237
96,123
General and administrative(1)
33,256
43,112
Total operating expenses
202,809
204,440
Loss from operations
(65,245
)
(96,232
)
Interest income and other income
(expense), net
5,666
(1,346
)
Interest expense
(967
)
(357
)
Loss before provision for income taxes
(60,546
)
(97,935
)
Provision for income taxes
922
933
Net loss
$
(61,468
)
$
(98,868
)
Net loss per share:
Basic and diluted
$
(0.28
)
$
(0.52
)
Weighted-average shares used in
calculating net loss per share:
Basic and diluted
216,413
189,590
_______________
(1) Amounts include stock-based
compensation expense as follows:
Three Months Ended April
30,
2023
2022
Cost of revenues
$
322
$
321
Research and development
23,497
21,129
Sales and marketing
11,533
12,489
General and administrative
6,146
5,970
Total stock-based compensation expense
$
41,498
$
39,909
ASANA, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
(unaudited)
April 30, 2023
January 31, 2023
Assets
Current assets
Cash and cash equivalents
$
382,234
$
526,563
Marketable securities
141,315
2,739
Accounts receivable, net
98,906
82,363
Prepaid expenses and other current
assets
48,088
48,726
Total current assets
670,543
660,391
Property and equipment, net
96,876
94,984
Operating lease right-of-use assets
194,365
176,189
Other assets
22,503
23,399
Total assets
$
984,287
$
954,963
Liabilities and Stockholders’
Equity
Current liabilities
Accounts payable
$
8,871
$
7,554
Accrued expenses and other current
liabilities
69,564
83,488
Deferred revenue, current
257,734
226,443
Operating lease liabilities, current
17,164
14,831
Total current liabilities
353,333
332,316
Term loan, net
46,082
46,696
Deferred revenue, noncurrent
6,215
7,156
Operating lease liabilities,
noncurrent
226,604
210,012
Other liabilities
3,968
2,209
Total liabilities
636,202
598,389
Stockholders’ equity
Common stock
2
2
Additional paid-in capital
1,647,422
1,595,001
Accumulated other comprehensive loss
(315
)
(873
)
Accumulated deficit
(1,299,024
)
(1,237,556
)
Total stockholders’ equity
348,085
356,574
Total liabilities and stockholders’
equity
$
984,287
$
954,963
ASANA, INC.
SUMMARY OF CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Three Months Ended April
30,
2023
2022
Cash flows from operating
activities
Net loss
$
(61,468
)
$
(98,868
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Allowance for expected credit losses
737
627
Depreciation and amortization
3,288
3,104
Amortization of deferred contract
acquisition costs
4,871
3,045
Stock-based compensation expense
41,498
39,909
Net amortization (accretion) of premium
(discount) on marketable securities
(444
)
55
Non-cash lease expense
5,263
3,639
Amortization of discount on convertible
notes and term loan issuance costs
30
4
Changes in operating assets and
liabilities:
Accounts receivable
(17,252
)
(8,531
)
Prepaid expenses and other current
assets
(4,625
)
(11,803
)
Other assets
881
(2,196
)
Accounts payable
(14
)
4,681
Accrued expenses and other liabilities
(13,417
)
791
Deferred revenue
30,350
27,801
Operating lease liabilities
(4,291
)
(3,391
)
Net cash used in operating activities
(14,593
)
(41,133
)
Cash flows from investing
activities
Purchases of marketable securities
(139,294
)
(46,554
)
Maturities of marketable securities
1,615
35,581
Purchases of property and equipment
(1,866
)
(1,048
)
Capitalized internal-use software
costs
(821
)
(70
)
Net cash used in investing activities
(140,366
)
(12,091
)
Cash flows from financing
activities
Repayment of term loan
(625
)
(667
)
Proceeds from exercise of stock
options
1,798
2,228
Proceeds from employee stock purchase
plan
8,558
9,156
Net cash provided by financing
activities
9,731
10,717
Effect of foreign exchange rates on cash
and cash equivalents
899
(568
)
Net decrease in cash and cash
equivalents
(144,329
)
(43,075
)
Cash and cash equivalents
Beginning of period
526,563
240,403
End of period
$
382,234
$
197,328
ASANA, INC.
Reconciliation of GAAP to
Non-GAAP Data
(In thousands, except
percentages)
(unaudited)
Three Months Ended April
30,
2023
2022
Reconciliation of gross profit and
gross margin
GAAP gross profit
$
137,564
$
108,208
Plus: stock-based compensation and related
employer payroll tax associated with RSUs
335
332
Non-GAAP gross profit
$
137,899
$
108,540
GAAP gross margin
90.3
%
89.7
%
Non-GAAP adjustments
0.2
%
0.3
%
Non-GAAP gross margin
90.5
%
90.0
%
Reconciliation of operating
expenses
GAAP research and development
$
76,316
$
65,205
Less: stock-based compensation and related
employer payroll tax associated with RSUs
(24,550
)
(22,081
)
Non-GAAP research and development
$
51,766
$
43,124
GAAP research and development as
percentage of revenue
50.1
%
54.0
%
Non-GAAP research and development as
percentage of revenue
34.0
%
35.7
%
GAAP sales and marketing
$
93,237
$
96,123
Less: stock-based compensation and related
employer payroll tax associated with RSUs
(11,884
)
(12,849
)
Less: restructuring costs
173
—
Non-GAAP sales and marketing
$
81,526
$
83,274
GAAP sales and marketing as percentage of
revenue
61.2
%
79.7
%
Non-GAAP sales and marketing as percentage
of revenue
53.5
%
69.0
%
GAAP general and administrative
$
33,256
$
43,112
Less: stock-based compensation and related
employer payroll tax associated with RSUs
(6,349
)
(6,254
)
Less: restructuring costs
(26
)
—
Non-GAAP general and administrative
$
26,881
$
36,858
GAAP general and administrative as
percentage of revenue
21.8
%
35.7
%
Non-GAAP general and administrative as
percentage of revenue
17.6
%
30.6
%
Reconciliation of operating loss and
operating margin
GAAP loss from operations
$
(65,245
)
$
(96,232
)
Plus: stock-based compensation and related
employer payroll tax associated with RSUs
43,118
41,516
Plus: restructuring costs
(147
)
—
Non-GAAP loss from operations
$
(22,274
)
$
(54,716
)
GAAP operating margin
(42.8
)%
(79.8
)%
Non-GAAP adjustments
28.2
%
34.4
%
Non-GAAP operating margin
(14.6
)%
(45.4
)%
ASANA, INC.
Reconciliation of GAAP to
Non-GAAP Data
(In thousands, except
percentages and per share data)
(unaudited)
Three Months Ended April
30,
2023
2022
Reconciliation of net loss
GAAP net loss
$
(61,468
)
$
(98,868
)
Plus: stock-based compensation and related
employer payroll tax associated with RSUs
43,118
41,516
Plus: restructuring costs
(147
)
—
Non-GAAP net loss
$
(18,497
)
$
(57,352
)
Reconciliation of net loss per
share
GAAP net loss per share, basic
$
(0.28
)
$
(0.52
)
Non-GAAP adjustments to net loss
0.19
0.22
Non-GAAP net loss per share, basic
$
(0.09
)
$
(0.30
)
Weighted-average shares used in GAAP and
non-GAAP per share calculation, basic and diluted
216,413
189,590
Three Months Ended April
30,
2023
2022
Computation of free cash flow
Net cash used in investing activities
$
(140,366
)
$
(12,091
)
Net cash provided by financing
activities
$
9,731
$
10,717
Net cash used in operating activities
$
(14,593
)
$
(41,133
)
Less: purchases of property and
equipment
(1,866
)
(1,048
)
Less: capitalized internal-use software
costs
(821
)
(70
)
Plus: restructuring costs paid
707
—
Plus: purchases of property and equipment
from build-out of corporate headquarters
—
2
Free cash flow
$
(16,573
)
$
(42,249
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230531005803/en/
Catherine Buan Asana Investor Relations ir@asana.com
Stephanie Hess Asana Corporate Communications
press@asana.com
Asana (NYSE:ASAN)
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