Press Releases AvePoint Announces Second Quarter 2021 Financial Results

AvePoint Announces Second Quarter 2021 Financial Results

AvePoint (NASDAQ: AVPT), the global leader in data security, governance, and resilience, today announced financial results for the second quarter ended June 30, 2021.

“In the second quarter we delivered record results, with revenue of $45.3 million, up 38% year-over-year, driven by the continued growth of Microsoft Teams and strong adoption of our collaboration security technologies,” said Dr. Tianyi Jiang (TJ), CEO and Co-Founder of AvePoint. “With the investments we are making across our go-to-market organization, including sales, customer success and channel, we aim to increase our market share of the Microsoft 365 user base, boost our customer retention rate and continue our strong growth in the SMB market via our channel partners.”

Second Quarter 2021 Financial Results

Total Revenue of $45.3 million, up 38% year-over-year
Total ARR¹ of $139.0 million as of June 30, 2021, up 33% year-over-year
SaaS Revenue of $20.6 million, up 76% year-over-year
GAAP Operating Loss of $11.2 million; GAAP Operating Margin of (24.7%)
Non-GAAP Operating Income of $3.3 million; Non-GAAP Operating Margin of 7.3%
GAAP net loss attributable to AvePoint, Inc. of $11.6 million or $0.98 per share
Cash and Cash Equivalents of approximately $66.3 million as of June 30, 2021
Net proceeds of $204.5 million from business combination which closed on July 1st, subsequent to second quarter end

Second Quarter 2021 Key Highlights

The AvePoint SaaS cloud platform, AvePoint Online Services, achieved FedRAMP Authorization signifying its SaaS solutions are approved for use across all United States federal agencies at the moderate impact level. The platform was also assessed against the Information Security Registered Assessors Program (IRAP), which ensures compliance with information security and requirements as mandated by the Australian Government
AvePoint released its Salesforce Cloud Backup for managed service providers (MSPs) across 36 countries and via 58 distributor app marketplaces
APAC’s leading distributor of cloud solutions and services, rhipe, now offers AvePoint solutions to its managed service provider (MSP) customers
Continued expansion in user base with more than 21,000 customers worldwide

Financial Outlook

For the third quarter of 2021, AvePoint currently expects:

Total revenues between $51.5 and $53.5 million
Non-GAAP operating income between $1.7 and $3.2 million

For the full year ending December 31, 2021, AvePoint currently expects:

Total revenues between $192.0 and $196.0 million
Non-GAAP operating income between $4.7 and $7.7 million

Conference Call
AvePoint will host a conference call today on August 10, 2021 to review its second quarter 2021 financial results and to discuss its financial outlook. The call is scheduled to begin at 4:30pm Eastern Time. Investors are invited to join the webcast by visiting https://ir.avepoint.com/events. The webcast will be available live, and a replay will be available following the completion of the live broadcast for approximately 90 days.

AvePoint Operations, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Revenue:
SaaS	$	20,586		$	11,699		$	38,845		$	21,942
Term license and support		11,088			7,357			19,815			15,101
Services		7,302			7,724			13,218			15,303
Maintenance and OEM		5,458			5,776			10,867			11,781
Perpetual license		910			400			1,399			1,490
Total revenue		45,344			32,956			84,144			65,617
Cost of revenue:
SaaS		4,564			2,543			9,004			5,057
Term license and support		230			348			503			820
Services		6,508			5,877			12,093			12,889
Maintenance and OEM		418			305			898			674
Total cost of revenue		11,720			9,073			22,498			19,440
Gross profit		33,624			23,883			61,646			46,177
Operating expenses:
Sales and marketing		29,001			14,010			48,302			28,051
General and administrative		11,664			5,291			21,956			10,449
Research and development		3,883			2,863			7,985			5,757
Depreciation and amortization		279			268			537			541
Total operating expenses		44,827			22,432			78,780			44,798
Income (loss) from operations		(11,203	)		1,451			(17,134	)		1,379
Interest income, net		11			5			24			9
Other income (expense), net		62			439			(1	)		(389	)
Income (loss) before income taxes		(11,130	)		1,895			(17,111	)		999
Income tax benefit		(73	)		(6,149	)		(1,112	)		(6,316	)
Net income (loss)	$	(11,057	)	$	8,044		$	(15,999	)	$	7,315
Net income attributable to redeemable noncontrolling interest		(499	)		—			(896	)		—
Net income (loss) attributable to AvePoint Operations, Inc.	$	(11,556	)	$	8,044		$	(16,895	)	$	7,315
Deemed dividends on preferred stock		(24,742	)		(8,063	)		(33,536	)		(15,798	)
Net loss available to common shareholders	$	(36,298	)	$	(19	)	$	(50,431	)	$	(8,483	)
Net loss per share of common stock, basic and diluted	$	(3.09	)	$	(0.00	)	$	(4.32	)	$	(0.87	)
Weighted average of shares used in computing net loss per share of common stock, basic and diluted		11,732			9,793			11,663			9,750

AvePoint Operations, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share and per share amounts)
(Unaudited)

	June 30,			December 31,
	2021			2020
Assets
Current assets
Cash and cash equivalents	$	66,338		$	69,112
Short-term investments		1,408			992
Accounts receivable, net of allowance of $1,030 and $1,767 at June 30, 2021 and December 31, 2020, respectively		44,753			48,250
Prepaid expenses and other current assets		4,319			2,343
Total current assets		116,818			120,697
Property and equipment, net		3,039			2,663
Deferred contract costs		33,781			31,943
Long-term unbilled receivables		6,440			5,499
Other assets		12,238			8,252
Total assets	$	172,316		$	169,054
Liabilities, mezzanine equity, and stockholders’ deficiency
Current liabilities:
Accounts payable	$	520		$	774
Accrued expenses and other liabilities		22,115			26,245
Current portion of deferred revenue		68,974			65,203
Total current liabilities		91,609			92,222
Long-term portion of deferred revenue		7,596			9,485
Share-based awards classified as liabilities		50,220			43,502
Other non-current liabilities		3,587			3,658
Total liabilities		153,012			148,867
Commitments and contingencies (Note 10)
Mezzanine equity
Redeemable convertible preferred stock, $0.0001 par value; 10,895,226 shares authorized, 4,832,409 and 4,832,409 shares issued and outstanding with aggregate liquidation preferences of $508,273 and $403,361 at June 30, 2021 and December 31, 2020, respectively		216,926			183,390
Redemption value of common shares		39,757			25,074
Share-based awards		1,695			1,489
Redeemable noncontrolling interest		4,143			3,061
Total mezzanine equity		262,521			213,014
Stockholders’ deficiency:
Common stock, $0.0001 par value; 28,000,000 and 28,000,000 shares authorized, 11,946,412 and 11,513,451 shares issued and outstanding, at June 30, 2021 and December 31, 2020, respectively		12			12
Additional paid-in capital		112,953			105,159
Accumulated other comprehensive income		1,848			1,791
Accumulated deficit		(358,030	)		(299,789	)
Total stockholders’ deficiency attributable to AvePoint Operations, Inc.		(243,217	)		(192,827	)
Total liabilities, mezzanine equity, and stockholders’ deficiency	$	172,316		$	169,054

AvePoint Operations, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

	For the Six Months Ended
	June 30,
	2021			2020
Operating activities
Net income (loss)	$	(15,999	)	$	7,315
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		537			541
Foreign currency remeasurement (gain) loss		(134	)		220
Provision for doubtful accounts		(732	)		818
Stock-based compensation		17,799			2,854
Gain on disposal of property and equipment		(15	)		—
Deferred income taxes		(981	)		(5,788	)
Changes in operating assets and liabilities:
Accounts receivable		2,399			4,822
Prepaid expenses and other current assets		(1,994	)		407
Other assets		(1,955	)		719
Accounts payable, accrued expenses and other liabilities		(4,057	)		(6,896	)
Deferred revenue		3,298			964
Accrued rent obligation		(87	)		(206	)
Net cash provided by (used in) operating activities		(1,921	)		5,770
Investing activities
Maturity (purchase) of short-term investments, net		(423	)		1,034
Purchase of APXT shares		(1,631	)		—
Purchase of property and equipment		(897	)		(169	)
Cash provided by (used in) investing activities		(2,951	)		865
Financing activities
Repayments of capital leases		(14	)		(33	)
Payments of transaction fees		(1,872	)		—
Proceeds from stock option exercises		3,277			15
Proceeds from sale of common shares of subsidiary		753			—
Payments of debt issuance costs		—			(120	)
Proceeds from issuance of Common stock		—			7,000
Net cash provided by financing activities		2,144			6,862
Effect of exchange rates on cash		(46	)		(284	)
Net increase (decrease) in cash and cash equivalents		(2,774	)		13,213
Cash and cash equivalents at beginning of period		69,112			12,162
Cash and cash equivalents at end of period	$	66,338		$	25,375
Supplemental disclosures of cash flow information
Cash received (paid) for:
Interest	$	24		$	8
Income taxes	$	(2,389	)	$	(529	)
Non-cash investing and financing activities
Fixed assets acquired under capital leases	$	—		$	28

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Non-GAAP gross profit
GAAP gross profit	$	33,624		$	23,883		$	61,646		$	46,177
Stock-based compensation expense		272			190			362			102
Non-GAAP gross profit	$	33,896		$	24,073		$	62,008		$	46,279
Non-GAAP gross margin		74.8	%		73.0	%		73.7	%		70.5	%
Non-GAAP sales and marketing
GAAP sales and marketing	$	29,001		$	14,010		$	48,302		$	28,051
Stock-based compensation expense		(9,791	)		(1,510	)		(10,902	)		(1,310	)
Non-GAAP sales and marketing	$	19,210		$	12,500		$	37,400		$	26,741
Non-GAAP sales and marketing as a % of revenue		42.4	%		37.9	%		44.4	%		40.8	%
Non-GAAP research and development
GAAP research and development	$	3,883		$	2,863		$	7,985		$	5,757
Stock-based compensation expense		(83	)		(72	)		(180	)		(147	)
Non-GAAP research and development	$	3,800		$	2,791		$	7,805		$	5,610
Non-GAAP research and development as a % of revenue		8.4	%		8.5	%		9.3	%		8.5	%
Non-GAAP general and administrative
GAAP general and administrative	$	11,664		$	5,291		$	21,956		$	10,449
Stock-based compensation expense		(4,364	)		(1,007	)		(6,355	)		(1,295	)
Non-GAAP general and administrative	$	7,300		$	4,284		$	15,601		$	9,154
Non-GAAP general and administrative as a % of revenue		16.1	%		13.0	%		18.5	%		14.0	%
Non-GAAP depreciation and amortization
GAAP depreciation and amortization	$	279		$	268		$	537		$	541
Non-GAAP depreciation and amortization	$	279		$	268		$	537		$	541
Non-GAAP depreciation and amortization as a % of revenue		0.6	%		0.8	%		0.6	%		0.8	%
Non-GAAP operating expenses
GAAP operating expenses	$	44,827		$	22,432		$	78,780		$	44,798
Stock-based compensation expense		(14,238	)		(2,589	)		(17,437	)		(2,752	)
Non-GAAP operating expenses	$	30,589		$	19,843		$	61,343		$	42,046
Non-GAAP operating expenses as a % of revenue		67.5	%		60.2	%		72.9	%		64.1	%
Non-GAAP operating income
GAAP operating income (loss)	$	(11,203	)	$	1,451		$	(17,134	)	$	1,379
Stock-based compensation expense		14,510			2,779			17,799			2,854
Non-GAAP operating income	$	3,307		$	4,230		$	665		$	4,233
Non-GAAP operating margin		7.3	%		12.8	%		0.8	%		6.5	%

About AvePoint

AvePoint is the global leader in data protection, unifying data security, governance, and resilience to provide a trusted foundation for AI. More than 28,000 customers rely on the AvePoint Confidence Platform to secure, govern, and rapidly recover data across Microsoft, Google, Salesforce, and other cloud environments. With a single platform for lifecycle control, multicloud governance, and rapid recovery paired with clear ownership across the business, we prevent overexposure and sprawl, modernize legacy and fragmented data, and minimize data loss and interruption. Our global partner ecosystem includes approximately 6,000 MSPs, VARs, and SIs, and our solutions are available in over 100 cloud marketplaces. To learn more, visit www.avepoint.com.