PCOR Procore Technologies Inc

Procore Technologies, Inc. (NYSE: PCOR), the leading global provider of construction management software, today announced financial results for the second quarter ended June 30, 2024.

“We are in the early innings of transforming one of the largest and least digitized industries in the world,” said Tooey Courtemanche, Founder, President, and CEO of Procore. “I am excited about the future of Procore as we embark on the next phase of our journey by connecting everyone in construction on a global platform.”

“We delivered a record operating margin in Q2 as we continue to demonstrate improved operating leverage in the business,” said Howard Fu, CFO of Procore. “Our financial model gives us the flexibility to accelerate our investment in go-to-market and capture the long-term growth opportunity ahead.”

Second Quarter 2024 Financial Highlights:

• Revenue was $284 million, an increase of 24% year-over-year.
• GAAP gross margin was 83% and non-GAAP gross margin was 87%.
• GAAP operating margin was (5%) and non-GAAP operating margin was 17.6%.
• Operating cash inflow for the second quarter was $59 million.
• Free cash inflow for the second quarter was $47 million.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

Recent Business Highlights:

• Achieved a gross revenue retention rate of 94% in the second quarter.
• Number of organic customers contributing more than $100,000 of annual recurring revenue totaled 2,191 as of June 30, 2024, an increase of 20% year-over-year.
• Added 152 net new organic customers in the second quarter, ending with a total of 16,750 organic customers.
• Announced a number of innovations to the Procore platform to deepen access to AI, improve field productivity, and drive efficient cost management, including enhancements to Maps and Locations and a new integration of Procore Copilot via Microsoft Teams.
• Announced the launch of the FedRAMP authorization process to strengthen cloud security for Federal customers.
• Recognized by U.S. News as one of the Best Companies to Work For.

Third Quarter and Full Year 2024 Outlook:

Procore is providing the following guidance for the third quarter and full year 2024:

• Third Quarter 2024 Outlook:
  • Revenue is expected to be in the range of $286 million to $288 million, representing year-over-year growth of 15% to 16%.
  • Non-GAAP operating margin is expected to be in the range of 9% to 10%.
• Full Year 2024 Outlook:
  • Revenue is expected to be in the range of $1,141 million to $1,144 million, representing year-over-year growth of 20%.
  • Non-GAAP operating margin is expected to be in the range of 10% to 11%.

A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Procore’s future GAAP financial results.

Quarterly Conference Call

Procore Technologies, Inc. will hold a conference call to discuss its second quarter results at 2:00 p.m., Pacific Time, on Thursday, August 1, 2024. A live audio webcast will be accessible on Procore's investor relations website at http://investors.procore.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, about Procore and its industry that involve substantial risks and uncertainties. All statements in this press release, other than statements of historical fact, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or future financial or operating performance, and may be identified by the use of words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would,” or the negative of these words, or other similar terms or expressions that concern Procore’s expectations, strategy, plans, or intentions.

Procore has based the forward-looking statements contained in this press release primarily on its current expectations and projections about future events and trends that Procore believes may affect its business, financial condition, and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors that could cause results to differ materially from Procore’s current expectations, including, but not limited to, our expectations regarding our financial performance (including revenues, expenses, and margins, and our ability to achieve or maintain future profitability), our ability to effectively manage our growth, anticipated performance, trends, growth rates, and challenges in our business and in the market in which we operate or anticipate entering into, economic and industry trends (in particular, the rate of adoption of construction management software and digitization of the construction industry, inflation, and challenging geopolitical conditions), our ability to attract new customers and retain and increase sales to existing customers, our ability to expand internationally, the effects of increased competition in our markets and our ability to compete effectively, our estimated total addressable market, and as set forth in Procore’s filings with the Securities and Exchange Commission. You should not place undue reliance on Procore’s forward-looking statements. Procore assumes no obligation to update any forward-looking statements to reflect events or circumstances that exist or change after the date on which they were made, except as required by law.

Non-GAAP Financial Measures

Procore believes that the use of certain non-GAAP financial measures as described below, when taken collectively, is helpful to investors because it provides consistency and comparability with past financial performance, and may assist in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their GAAP results. These non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles, or GAAP.

Non-GAAP Gross Profit, Non-GAAP Gross Margin, Non-GAAP Operating Expenses, Non-GAAP Income (Loss) from Operations, Non-GAAP Operating Margin, Non-GAAP Net Income, and Non-GAAP Net Income per Share: Procore defines these non-GAAP financial measures as the respective GAAP measures, excluding stock-based compensation expense, amortization of acquired intangible assets, employer payroll tax related to employee stock transactions, and acquisition-related expenses. Non-GAAP gross margin is the ratio calculated by dividing non-GAAP gross profit by total revenue. Non-GAAP operating margin is the ratio calculated by dividing non-GAAP income (loss) from operations by total revenue. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Non-GAAP diluted earnings per share is computed by giving effect to all potential weighted average dilutive common stock equivalents outstanding for the period, including options to purchase common stock, restricted stock units, and shares to be issued pursuant to the employee stock purchase plan. The dilutive effect of outstanding awards is reflected in non-GAAP diluted earnings per share by application of the treasury stock method.

Stock-based compensation expense includes the net effects of capitalization and amortization of stock-based compensation expense related to capitalized software and cloud-computing arrangement implementation costs. Stock-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of the compensation provided to our employees. Because of varying available valuation methodologies, subjective assumptions, and the variety of equity instruments that can impact a company’s non-cash expenses, we believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for meaningful comparisons between its operating results from period to period. The expense related to amortization of acquired intangible assets is dependent upon estimates and assumptions, which can vary significantly and are unique to each asset acquired; therefore, Procore believes non-GAAP measures that adjust for the amortization of acquired intangible assets provide investors a consistent basis for comparison across accounting periods. The amount of employer payroll tax-related items on employee stock transactions is dependent on restricted stock unit settlements, option exercises, related stock price, and other factors that are beyond Procore’s control and that do not correlate to the operation of the business. When evaluating the performance of its business and making operating plans, Procore does not consider these items (for example, when considering the impact of equity award grants, the company places a greater emphasis on overall stockholder dilution than the accounting charges associated with such grants). Since the amount of employer payroll tax-related items on employee stock transactions is highly variable due to factors outside our control, and unrelated to Procore’s core operations, operating results, revenue-generating activities, business strategy, industry, or regulatory environment, management does not consider employer payroll tax on employee stock transactions in the evaluation of the business or in making operating plans. Accordingly, Procore believes this adjustment in arriving at our non-GAAP measures provides investors with a better understanding of the performance of its core business in a manner that is consistent with management’s view of the business. Additionally, acquisition-related expenses, such as transaction costs and retention payments, are expenses that are not necessarily reflective of operational performance during a period. Procore believes that the exclusion of acquisition-related expenses provides for a useful comparison of our operating results to prior periods and to its peer companies, which commonly exclude these expenses. Overall, Procore believes it is useful to exclude these expenses in order to better understand the long-term performance of its core business and to facilitate comparison of its results period-over-period and to those of peer companies. All of these non-GAAP financial measures are important tools for financial and operational decision-making and for evaluating Procore's own operating results over different periods of time.

Non-GAAP financial measures may not provide information that is directly comparable to information provided by other companies in Procore's industry, as other companies in the industry may calculate non-GAAP financial measures differently. In addition, there are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies, and exclude expenses that may have a material impact on Procore's reported financial results. Unlike stock-based compensation expense, employer payroll tax related to employee stock transactions is a cash expense that we will continue to incur in the future. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Investors should review the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate Procore's business.

Free Cash Flow: Procore defines free cash flow as net cash provided by (used in) operating activities, less purchases of property and equipment and capitalized software development costs. Procore believes free cash flow is an important liquidity measure of the cash (if any) that is available, after our operating activities and capital expenditures. Procore uses free cash flow in conjunction with traditional GAAP measures to assess its liquidity and evaluate the effectiveness of its business strategies. Once Procore’s business needs and obligations are met, cash can be used to maintain a strong balance sheet and invest in future growth.

Other Metrics

Customer Count: The aforementioned customer count excludes customers acquired from business combinations that do not have standard Procore annual contracts.

About Procore

Procore Technologies, Inc. (NYSE: PCOR) creates software for people who build the world. With a focus on providing timely and accurate data for all, Procore transforms the construction industry one project at a time - from hospitals and skyscrapers to airports and stadiums. Beyond its connected, innovative technology, Procore empowers the industry and its communities through Procore.org. For more information, visit www.procore.com.

PROCORE-IR

Category: Earnings

Procore Technologies, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands, except share and per share amounts)

Revenue

$

284,347

 

 

$

228,536

 

 

$

553,775

 

 

$

442,062

 

Cost of revenue(1)(2)(3)

 

48,101

 

 

 

42,304

 

 

 

93,824

 

 

 

82,506

 

Gross profit

 

236,246

 

 

 

186,232

 

 

 

459,951

 

 

 

359,556

 

Operating expenses

 

 

 

 

 

 

 

Sales and marketing(1)(2)(3)(4)

 

127,922

 

 

 

125,362

 

 

 

248,916

 

 

 

242,725

 

Research and development(1)(2)(3)(4)

 

72,308

 

 

 

73,216

 

 

 

142,907

 

 

 

153,252

 

General and administrative(1)(3)(4)

 

50,792

 

 

 

46,383

 

 

 

101,810

 

 

 

91,571

 

Total operating expenses

 

251,022

 

 

 

244,961

 

 

 

493,633

 

 

 

487,548

 

Loss from operations

 

(14,776

)

 

 

(58,729

)

 

 

(33,682

)

 

 

(127,992

)

Interest income

 

5,814

 

 

 

4,943

 

 

 

11,752

 

 

 

9,891

 

Interest expense

 

(472

)

 

 

(491

)

 

 

(951

)

 

 

(987

)

Accretion income, net

 

3,761

 

 

 

2,031

 

 

 

6,849

 

 

 

3,663

 

Other expense, net

 

(148

)

 

 

(313

)

 

 

(492

)

 

 

(523

)

Loss before provision for income taxes

 

(5,821

)

 

 

(52,559

)

 

 

(16,524

)

 

 

(115,948

)

Provision for income taxes

 

490

 

 

 

322

 

 

 

753

 

 

 

380

 

Net loss

$

(6,311

)

 

$

(52,881

)

 

$

(17,277

)

 

$

(116,328

)

Net loss per share attributable to common stockholders, basic and diluted

$

(0.04

)

 

$

(0.37

)

 

$

(0.12

)

 

$

(0.83

)

Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted

 

146,938,942

 

 

 

141,238,489

 

 

 

146,207,469

 

 

 

140,446,873

(1)

Includes stock-based compensation expense and amortization of capitalized stock-based compensation as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Cost of revenue

$

3,683

 

$

2,880

 

$

6,868

 

$

5,376

Sales and marketing

 

15,671

 

 

 

14,470

 

 

 

28,691

 

 

 

27,574

 

Research and development

 

17,628

 

 

 

16,270

 

 

 

31,363

 

 

 

36,051

 

General and administrative

 

13,961

 

 

 

9,909

 

 

 

25,690

 

 

 

20,384

 

Total stock-based compensation expense*

$

50,943

 

 

$

43,529

 

 

$

92,612

 

 

$

89,385

 

*Includes amortization of capitalized stock-based compensation of $1.7 million and $1.0 million, respectively, for the three months ended June 30, 2024 and 2023; and $3.3 million and $2.0 million, respectively, for the six months ended June 30, 2024 and 2023; which was initially capitalized as capitalized software and cloud-computing arrangement implementation costs.

(2)

Includes amortization of acquired intangible assets as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Cost of revenue

$

6,156

 

$

5,493

 

$

12,041

 

$

10,986

Sales and marketing

 

3,145

 

 

 

3,106

 

 

 

6,251

 

 

 

6,213

 

Research and development

 

665

 

 

 

675

 

 

 

1,340

 

 

 

1,409

 

Total amortization of acquired intangible assets

$

9,966

 

 

$

9,274

 

 

$

19,632

 

 

$

18,608

 

(3)

Includes employer payroll tax on employee stock transactions as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Cost of revenue

$

161

 

$

139

 

$

373

 

$

306

Sales and marketing

 

788

 

 

 

618

 

 

 

2,052

 

 

 

1,617

 

Research and development

 

900

 

 

 

891

 

 

 

2,568

 

 

 

2,247

 

General and administrative

 

494

 

 

 

503

 

 

 

1,539

 

 

 

1,135

 

Total employer payroll tax on employee stock transactions

$

2,343

 

 

$

2,151

 

 

$

6,532

 

 

$

5,305

 

(4)

Includes acquisition-related expenses as follows:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Sales and marketing

$

1,000

 

$

548

 

$

1,448

 

$

1,454

Research and development

 

—

 

 

 

204

 

 

 

—

 

 

 

6,188

 

General and administrative

 

563

 

 

 

—

 

 

 

563

 

 

 

—

 

Total acquisition-related expenses

$

1,563

 

 

$

752

 

 

$

2,011

 

 

$

7,642

 

Procore Technologies, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

 

 

June 30,

2024

 

December 31,

2023

 

(in thousands)

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

356,239

 

 

$

357,790

 

Marketable securities, current

 

379,120

 

 

 

320,161

 

Accounts receivable, net

 

158,700

 

 

 

206,644

 

Contract cost asset, current

 

30,946

 

 

 

28,718

 

Prepaid expenses and other current assets

 

41,471

 

 

 

42,421

 

Total current assets

 

966,476

 

 

 

955,734

 

Marketable securities, non-current

 

45,430

 

 

 

—

 

Capitalized software development costs, net

 

95,763

 

 

 

83,045

 

Property and equipment, net

 

34,895

 

 

 

36,258

 

Right of use assets - finance leases

 

33,051

 

 

 

34,375

 

Right of use assets - operating leases

 

35,255

 

 

 

44,141

 

Contract cost asset, non-current

 

44,193

 

 

 

44,564

 

Intangible assets, net

 

142,293

 

 

 

137,546

 

Goodwill

 

550,363

 

 

 

539,354

 

Other assets

 

19,316

 

 

 

18,551

 

Total assets

$

1,967,035

 

 

$

1,893,568

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

$

26,951

 

 

$

13,177

 

Accrued expenses

 

71,253

 

 

 

100,075

 

Deferred revenue, current

 

494,680

 

 

 

501,903

 

Other current liabilities

 

31,894

 

 

 

27,275

 

Total current liabilities

 

624,778

 

 

 

642,430

 

Deferred revenue, non-current

 

6,135

 

 

 

7,692

 

Finance lease liabilities, non-current

 

42,468

 

 

 

43,581

 

Operating lease liabilities, non-current

 

32,578

 

 

 

37,923

 

Other liabilities, non-current

 

5,278

 

 

 

6,332

 

Total liabilities

 

711,237

 

 

 

737,958

 

Stockholders’ equity

 

 

 

Common stock

 

15

 

 

 

15

 

Additional paid-in capital

 

2,414,224

 

 

 

2,295,807

 

Accumulated other comprehensive loss

 

(2,327

)

 

 

(1,375

)

Accumulated deficit

 

(1,156,114

)

 

 

(1,138,837

)

Total stockholders’ equity

 

1,255,798

 

 

 

1,155,610

 

Total liabilities and stockholders’ equity

$

1,967,035

 

 

$

1,893,568

 

Remaining performance obligation:

 

The following table presents our current and non-current RPO at the end of each period:

 

 

June 30,

 

Change

 

2024

 

2023

 

Dollar

 

Percent

 

(dollars in thousands)

Remaining performance obligations

 

 

 

 

 

 

 

Current

$

724,832

 

$

622,639

 

$

102,193

 

16

%

Non-current

 

310,381

 

 

 

226,877

 

 

 

83,504

 

 

37

%

Total remaining performance obligations

$

1,035,213

 

 

$

849,516

 

 

$

185,697

 

 

22

%

Procore Technologies, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Operating activities

 

 

 

 

 

 

 

Net loss

$

(6,311

)

 

$

(52,881

)

 

$

(17,277

)

 

$

(116,328

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities

 

 

 

 

 

 

 

Stock-based compensation

 

49,225

 

 

 

42,487

 

 

 

89,357

 

 

 

87,425

 

Depreciation and amortization

 

20,843

 

 

 

17,336

 

 

 

40,894

 

 

 

34,210

 

Accretion of discounts on marketable debt securities, net

 

(3,661

)

 

 

(2,030

)

 

 

(6,749

)

 

 

(3,662

)

Abandonment of long-lived assets

 

312

 

 

 

94

 

 

 

580

 

 

 

535

 

Noncash operating lease expense

 

2,259

 

 

 

2,604

 

 

 

4,993

 

 

 

5,232

 

Unrealized foreign currency loss, net

 

(365

)

 

 

149

 

 

 

714

 

 

 

557

 

Deferred income taxes

 

1

 

 

 

3

 

 

 

2

 

 

 

5

 

Provision for credit losses

 

216

 

 

 

2,004

 

 

 

405

 

 

 

3,730

 

Increase (decrease) in fair value of strategic investments

 

118

 

 

 

42

 

 

 

(641

)

 

 

6

 

Changes in operating assets and liabilities, net of effect of asset acquisitions and business combinations

 

 

 

 

 

 

 

Accounts receivable

 

(19,019

)

 

 

(19,371

)

 

 

48,994

 

 

 

23,577

 

Deferred contract cost assets

 

(1,662

)

 

 

(3,170

)

 

 

(2,089

)

 

 

(3,630

)

Prepaid expenses and other assets

 

494

 

 

 

(2,848

)

 

 

(190

)

 

 

1,701

 

Accounts payable

 

10,124

 

 

 

(3,499

)

 

 

13,279

 

 

 

1,149

 

Accrued expenses and other liabilities

 

3,707

 

 

 

(2,929

)

 

 

(30,447

)

 

 

(31,110

)

Deferred revenue

 

3,231

 

 

 

13,093

 

 

 

(10,877

)

 

 

19,582

 

Operating lease liabilities

 

(817

)

 

 

(2,761

)

 

 

(3,108

)

 

 

(5,381

)

Net cash provided by (used in) operating activities

 

58,695

 

 

 

(11,677

)

 

 

127,840

 

 

 

17,598

 

Investing activities

 

 

 

 

 

 

 

Purchases of property and equipment

 

(1,874

)

 

 

(2,521

)

 

 

(3,963

)

 

 

(4,694

)

Capitalized software development costs

 

(10,218

)

 

 

(9,400

)

 

 

(19,732

)

 

 

(17,351

)

Purchases of strategic investments

 

(862

)

 

 

(293

)

 

 

(1,072

)

 

 

(442

)

Purchases of marketable securities

 

(222,940

)

 

 

(139,286

)

 

 

(324,374

)

 

 

(229,282

)

Maturities of marketable securities

 

118,798

 

 

 

118,817

 

 

 

226,099

 

 

 

222,726

 

Sales of marketable securities

 

—

 

 

 

5,452

 

 

 

—

 

 

 

5,452

 

Originations of materials financing

 

—

 

 

 

(7,930

)

 

 

—

 

 

 

(17,007

)

Customer repayments of materials financing

 

202

 

 

 

7,638

 

 

 

1,483

 

 

 

12,996

 

Acquisition of a business, net of cash acquired

 

(25,945

)

 

 

—

 

 

 

(25,945

)

 

 

—

 

Asset acquisitions, net of cash acquired

 

(3,787

)

 

 

—

 

 

 

(3,792

)

 

 

—

 

Net cash used in investing activities

 

(146,626

)

 

 

(27,523

)

 

 

(151,296

)

 

 

(27,602

)

Financing activities

 

 

 

 

 

 

 

Proceeds from stock option exercises

 

2,790

 

 

 

7,217

 

 

 

9,915

 

 

 

10,939

 

Proceeds from employee stock purchase plan

 

13,187

 

 

 

13,006

 

 

 

13,187

 

 

 

13,006

 

Principal payments under finance lease agreements, net of proceeds from lease incentives

 

(220

)

 

 

(520

)

 

 

(669

)

 

 

(930

)

Net cash provided by financing activities

 

15,757

 

 

 

19,703

 

 

 

22,433

 

 

 

23,015

 

Net increase in cash and cash equivalents

 

(72,174

)

 

 

(19,497

)

 

 

(1,023

)

 

 

13,011

 

Effect of exchange rate changes on cash

 

757

 

 

 

(53

)

 

 

(528

)

 

 

(309

)

Cash and cash equivalents, beginning of period

 

427,656

 

 

 

332,068

 

 

 

357,790

 

 

 

299,816

 

Cash and cash equivalents, end of period

$

356,239

 

 

$

312,518

 

 

$

356,239

 

 

$

312,518

 

Procore Technologies, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited)

 

Reconciliation of gross profit and gross margin to non-GAAP gross profit and non-GAAP gross margin:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(dollars in thousands)

Revenue

$

284,347

 

 

$

228,536

 

 

$

553,775

 

 

$

442,062

 

Gross profit

 

236,246

 

 

 

186,232

 

 

 

459,951

 

 

 

359,556

 

Stock-based compensation expense

 

3,683

 

 

 

2,880

 

 

 

6,868

 

 

 

5,376

 

Amortization of acquired technology intangible assets

 

6,156

 

 

 

5,493

 

 

 

12,041

 

 

 

10,986

 

Employer payroll tax on employee stock transactions

 

161

 

 

 

139

 

 

 

373

 

 

 

306

 

Non-GAAP gross profit

$

246,246

 

 

$

194,744

 

 

$

479,233

 

 

$

376,224

 

Gross margin

 

83

%

 

 

81

%

 

 

83

%

 

 

81

%

Non-GAAP gross margin

 

87

%

 

 

85

%

 

 

87

%

 

 

85

%

Reconciliation of operating expenses to non-GAAP operating expenses:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(dollars in thousands)

Revenue

$

284,347

 

 

$

228,536

 

 

$

553,775

 

 

$

442,062

 

GAAP sales and marketing

 

127,922

 

 

 

125,362

 

 

 

248,916

 

 

 

242,725

 

Stock-based compensation expense

 

(15,671

)

 

 

(14,470

)

 

 

(28,691

)

 

 

(27,574

)

Amortization of acquired intangible assets

 

(3,145

)

 

 

(3,106

)

 

 

(6,251

)

 

 

(6,213

)

Employer payroll tax on employee stock transactions

 

(788

)

 

 

(618

)

 

 

(2,052

)

 

 

(1,617

)

Acquisition-related expenses

 

(1,000

)

 

 

(548

)

 

 

(1,448

)

 

 

(1,454

)

Non-GAAP sales and marketing

$

107,318

 

 

$

106,620

 

 

$

210,474

 

 

$

205,867

 

GAAP sales and marketing as a percentage of revenue

 

45

%

 

 

55

%

 

 

45

%

 

 

55

%

Non-GAAP sales and marketing as a percentage of revenue

 

38

%

 

 

47

%

 

 

38

%

 

 

47

%

 

 

 

 

 

 

 

 

GAAP research and development

$

72,308

 

 

$

73,216

 

 

$

142,907

 

 

$

153,252

 

Stock-based compensation expense

 

(17,628

)

 

 

(16,270

)

 

 

(31,363

)

 

 

(36,051

)

Amortization of acquired intangible assets

 

(665

)

 

 

(675

)

 

 

(1,340

)

 

 

(1,409

)

Employer payroll tax on employee stock transactions

 

(900

)

 

 

(891

)

 

 

(2,568

)

 

 

(2,247

)

Acquisition-related expenses

 

—

 

 

 

(204

)

 

 

—

 

 

 

(6,188

)

Non-GAAP research and development

$

53,115

 

 

$

55,176

 

 

$

107,636

 

 

$

107,357

 

GAAP research and development as a percentage of revenue

 

25

%

 

 

32

%

 

 

26

%

 

 

35

%

Non-GAAP research and development as a percentage of revenue

 

19

%

 

 

24

%

 

 

19

%

 

 

24

%

 

 

 

 

 

 

 

 

GAAP general and administrative

$

50,792

 

 

$

46,383

 

 

$

101,810

 

 

$

91,571

 

Stock-based compensation expense

 

(13,961

)

 

 

(9,909

)

 

 

(25,690

)

 

 

(20,384

)

Employer payroll tax on employee stock transactions

 

(494

)

 

 

(503

)

 

 

(1,539

)

 

 

(1,135

)

Acquisition-related expenses

 

(563

)

 

 

—

 

 

 

(563

)

 

 

—

 

Non-GAAP general and administrative

$

35,774

 

 

$

35,971

 

 

$

74,018

 

 

$

70,052

 

GAAP general and administrative as a percentage of revenue

 

18

%

 

 

20

%

 

 

18

%

 

 

21

%

Non-GAAP general and administrative as a percentage of revenue

 

13

%

 

 

16

%

 

 

13

%

 

 

16

%

Reconciliation of loss from operations and operating margin to non-GAAP income (loss) from operations and non-GAAP operating margin:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(dollars in thousands)

Revenue

$

284,347

 

 

$

228,536

 

 

$

553,775

 

 

$

442,062

 

Loss from operations

 

(14,776

)

 

 

(58,729

)

 

 

(33,682

)

 

 

(127,992

)

Stock-based compensation expense

 

50,943

 

 

 

43,529

 

 

 

92,612

 

 

 

89,385

 

Amortization of acquired intangible assets

 

9,966

 

 

 

9,274

 

 

 

19,632

 

 

 

18,608

 

Employer payroll tax on employee stock transactions

 

2,343

 

 

 

2,151

 

 

 

6,532

 

 

 

5,305

 

Acquisition-related expenses

 

1,563

 

 

 

752

 

 

 

2,011

 

 

 

7,642

 

Non-GAAP income (loss) from operations

$

50,039

 

 

$

(3,023

)

 

$

87,105

 

 

$

(7,052

)

Operating margin

 

(5

%)

 

 

(26

%)

 

 

(6

%)

 

 

(29

%)

Non-GAAP operating margin

 

18

%

 

 

(1

%)

 

 

16

%

 

 

(2

%)

Reconciliation of net loss and net loss per share to non-GAAP net income and non-GAAP net income per share:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands, except share and per share amounts)

Revenue

$

284,347

 

 

$

228,536

 

 

$

553,775

 

 

$

442,062

 

Net loss

 

(6,311

)

 

 

(52,881

)

 

 

(17,277

)

 

 

(116,328

)

Stock-based compensation expense

 

50,943

 

 

 

43,529

 

 

 

92,612

 

 

 

89,385

 

Amortization of acquired intangible assets

 

9,966

 

 

 

9,274

 

 

 

19,632

 

 

 

18,608

 

Employer payroll tax on employee stock transactions

 

2,343

 

 

 

2,151

 

 

 

6,532

 

 

 

5,305

 

Acquisition-related expenses

 

1,563

 

 

 

752

 

 

 

2,011

 

 

 

7,642

 

Non-GAAP net income

$

58,504

 

 

$

2,825

 

 

$

103,510

 

 

$

4,612

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

Non-GAAP net income

$

58,504

 

 

$

2,825

 

 

$

103,510

 

 

$

4,612

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

Weighted-average shares used in computing net loss per share attributable to common stockholders, basic

 

146,938,942

 

 

 

141,238,489

 

 

 

146,207,469

 

 

 

140,446,873

 

Effect of dilutive securities: Employee stock awards

 

4,653,396

 

 

 

6,117,368

 

 

 

5,349,382

 

 

 

6,537,556

 

Weighted-average shares used in computing net income per share attributable to common stockholders, diluted

 

151,592,338

 

 

 

147,355,857

 

 

 

151,556,851

 

 

 

146,984,429

 

 

 

 

 

 

 

 

 

GAAP net loss per share, basic

$

(0.04

)

 

$

(0.37

)

 

$

(0.12

)

 

$

(0.83

)

GAAP net loss per share, diluted

$

(0.04

)

 

$

(0.37

)

 

$

(0.12

)

 

$

(0.83

)

Non-GAAP net income per share, basic

$

0.40

 

 

$

0.02

 

 

$

0.71

 

 

$

0.03

 

Non-GAAP net income per share, diluted

$

0.39

 

 

$

0.02

 

 

$

0.68

 

 

$

0.03

 

Computation of free cash flow:

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

 

(in thousands)

Net cash provided by (used in) operating activities

$

58,695

 

 

$

(11,677

)

 

$

127,840

 

 

$

17,598

 

Purchases of property, plant, and equipment

 

(1,874

)

 

 

(2,521

)

 

 

(3,963

)

 

 

(4,694

)

Capitalized software development costs

 

(10,218

)

 

 

(9,400

)

 

 

(19,732

)

 

 

(17,351

)

Non-GAAP free cash flow

$

46,603

 

 

$

(23,598

)

 

$

104,145

 

 

$

(4,447

)

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240801037273/en/

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Investor Contact ir@procore.com