Yahoo Finance Veritone Inc (VERI) Q1 2024 Earnings Call Transcript Highlights: Strategic Moves and Financial ...
Total Revenue: $31.6 million, up 4.5% from Q1 2023.
Non-GAAP Operating Loss: $7.6 million, an improvement from guidance.
Annual Recurring Revenue (ARR): $72.1 million, with $48.6 million from subscription-based customers.
Subscription-based ARR Growth: 7% increase from Q1 2023.
Non-GAAP Net Loss: Improved by $2 million to $7.6 million from Q1 2023.
Cash and Restricted Cash: $91.7 million as of March 31, 2024.
Debt: Total consolidated debt of $168.5 million.
Cost Reduction Initiatives: Executed over $37 million of annualized savings since the beginning of 2023.
Q2 Revenue Guidance: Expected to be between $31 million and $32 million.
Full Year Revenue Guidance for 2024: Increased to between $136 million and $142 million.
Full Year Non-GAAP Net Loss Guidance for 2024: Expected to be between $11 million and $15 million.
Release Date: May 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Veritone Inc (NASDAQ:VERI) reported a total revenue of $31.6 million for Q1 2024, surpassing the high end of their guidance.
Annual recurring revenue (ARR) reached $72.1 million, with a 7% improvement in subscription-based ARR from Q1 2023.
The company has successfully executed cost reduction initiatives, achieving $37 million in savings since the beginning of 2023, which contributes to their pathway towards profitability.
Veritone Inc (NASDAQ:VERI) launched an integrated AI Consulting and Services group, expanding their market offerings and addressing the growing demand for enterprise AI technology deployment expertise.
The company has a robust pipeline with new and existing customers across various sectors, indicating potential for future growth and revenue generation.
Negative Points
Veritone Inc (NASDAQ:VERI) reported a non-GAAP operating loss of $7.6 million for Q1 2024, indicating ongoing challenges in achieving profitability.
Despite improvements, the company's subscription-based ARR growth was offset by a decline in consumption-based ARR, particularly impacted by reduced spending from major customers like Amazon.
The company faces uncertainties in rapid and widespread adoption of AI technologies, as indicated by barriers such as lack of knowledge and privacy concerns among firms.
Veritone Inc (NASDAQ:VERI) is still in the process of realizing full benefits from restructuring efforts, with expected materialization of cost and revenue synergies later in the year.
There are ongoing challenges with the integration of acquisitions, which could impact the smooth scaling of operations and delay expected synergies.
Q & A Highlights
Q: Can you comment more on your target for cash flow profitability in Q4 and the impact of today's announcement on future expectations? A: Ryan Steelberg, CEO, highlighted the company's effective execution of cost-savings initiatives, totaling nearly $37 million since early 2023, which significantly alters the business's financial profile. He expressed confidence in achieving profitability by the end of 2024 due to these savings combined with revenue improvements. Regarding the announcement of expanding into AI Consulting and Services, he sees it as a critical component to support customers' AI needs, expecting it to contribute significantly to the business from 2024 onwards.
Q: Are there any updates on the $15 million blanket purchase agreement with the DOJ mentioned in the last call? A: Ryan Steelberg, CEO, confirmed active servicing against the DOJ's blanket purchase agreement, with task orders already being executed. He anticipates fully utilizing this agreement over the coming quarters and sees further opportunities with various federal agencies.
Q: How did Veritone perform financially in Q1 2024? A: Michael Zemetra, CFO, reported a revenue of $31.6 million, a 4.5% increase from Q1 2023, driven by gains in software products and services. The non-GAAP net loss improved by $2 million compared to Q1 2023, reflecting better gross profit and cost reductions.
Q: What are the expectations for Q2 and the full year of 2024? A: Michael Zemetra, CFO, provided guidance for Q2 revenue between $31 million and $32 million, indicating a year-over-year improvement. For the full year, revenue is expected to range from $136 million to $142 million, with non-GAAP net loss projected between $11 million and $15 million. He highlighted the potential for cash flow positivity on a non-GAAP basis by Q4 2024.
Q: What strategic initiatives has Veritone undertaken to enhance its business model? A: Ryan Steelberg, CEO, discussed the launch of an integrated AI Consulting and Services group to meet growing enterprise AI technology deployment demands. This move aims to bridge the gap between AI providers and customers, enhancing Veritone's service offerings and potentially increasing revenue.
Q: Can you discuss the impact of the restructuring efforts on Veritone's operations? A: Ryan Steelberg, CEO, noted that restructuring efforts throughout Q1 2024 are aligning the company's investments and operations to focus on long-term, sustainable growth. These efforts are expected to start showing full benefits from Q2 2024, with additional cost and revenue synergies anticipated later in the year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
