Everbridge (NASDAQ:EVBG) Reports Q3 In Line With Expectations But Customer Growth Slows Down

Radek Strnad /
2022/11/08 7:09 am EST
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Critical event management software company Everbridge (NASDAQ:EVBG) reported results in line with analyst expectations in Q3 FY2022 quarter, with revenue up 15.1% year on year to $111.4 million. The company expects that next quarter's revenue would be around $116.2 million, which is the midpoint of the guidance range. That was in roughly line with analyst expectations. Everbridge made a GAAP loss of $22 million, improving on its loss of $28.6 million, in the same quarter last year.

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Everbridge (EVBG) Q3 FY2022 Highlights:

  • Revenue: $111.4 million vs analyst estimates of $110.7 million (small beat)
  • EPS (non-GAAP): $0.27 vs analyst estimates of $0.16 ($0.11 beat)
  • Revenue guidance for Q4 2022 is $116.2 million at the midpoint, roughly in line with what analysts were expecting
  • Free cash flow of $13.6 million, up from negative free cash flow of $13.9 million in previous quarter
  • Customers: 6,417, up from 6,345 in previous quarter
  • Gross Margin (GAAP): 68.1%, in line with same quarter last year

“Our third quarter results demonstrate continued progress in our ongoing evolution to a mature, profitable growth business,” said David Wagner, Everbridge’s President and CEO.

Founded as a reaction to the catastrophic events of 9/11, Everbridge (NASDAQ:EVBG) supplies software that helps governments and businesses keep people and infrastructure safe in emergencies.

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Sales Growth

As you can see below, Everbridge's revenue growth has been strong over the last two years, growing from quarterly revenue of $71.2 million in Q3 FY2020, to $111.4 million.

Everbridge Total Revenue

This quarter, Everbridge's quarterly revenue was once again up 15.1% year on year. We can see that the company increased revenue by $8.41 million quarter on quarter. That's a solid improvement on the $2.61 million increase in Q2 2022, so shareholders should appreciate the re-acceleration of growth.

Guidance for the next quarter indicates Everbridge is expecting revenue to grow 13% year on year to $116.2 million, slowing down from the 36% year-over-year increase in revenue the company had recorded in the same quarter last year. Ahead of the earnings results the analysts covering the company were estimating sales to grow 13.9% over the next twelve months.

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Customer Growth

You can see below that Everbridge reported 6,417 customers at the end of the quarter, an increase of 72 on last quarter. That is a little slower customer growth than what we are used to seeing lately, suggesting that the customer acquisition momentum is slowing a little bit.

Everbridge Customers

Key Takeaways from Everbridge's Q3 Results

With a market capitalization of $993.3 million Everbridge is among smaller companies, but its more than $486.9 million in cash and positive free cash flow over the last twelve months put it in a very strong position to invest in growth.

It was good to see Everbridge produce strong free cash flow. On the other hand, it was unfortunate to see the slowdown in customer growth and revenue growth is bit slower these days. Overall, this quarter's results were mostly in-line, showing the company is staying on target. The company is flat on the results and currently trades at $25.00 per share.

Everbridge may have had a tough quarter, but does that actually create an opportunity to invest right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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The author has no position in any of the stocks mentioned.