Everbridge's (NASDAQ:EVBG) Q2 Earnings Results: Revenue In Line With Expectations But Full-Year Guidance Underwhelms

Jabin Bastian /
2023/08/08 8:53 am EDT

Critical event management software company Everbridge (NASDAQ:EVBG) reported results in line with analysts' expectations in Q2 FY2023, with revenue up 7.36% year on year to $110.6 million. However, next quarter's revenue guidance of $113.8 million was less impressive, coming in 2.76% below analysts' estimates. Everbridge made a GAAP loss of $15.1 million, improving from its loss of $36.2 million in the same quarter last year.

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Everbridge (EVBG) Q2 FY2023 Highlights:

  • Revenue: $110.6 million vs analyst estimates of $110.2 million (small beat)
  • EPS (non-GAAP): $0.31 vs analyst estimates of $0.27 (16.2% beat)
  • Revenue Guidance for Q3 2023 is $113.8 million at the midpoint, below analyst estimates of $117 million
  • The company dropped revenue guidance for the full year from $459 million to $451 million at the midpoint, a 1.74% decrease
  • Free Cash Flow of $9 thousand, down 99.9% from the previous quarter
  • Gross Margin (GAAP): 70.1%, up from 68.1% in the same quarter last year

“We delivered solid second quarter results as we continue to improve our overall operating efficiency,” said David Wagner, President and CEO of Everbridge.

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 solid over the last two years, growing from $86.6 million in Q2 FY2021 to $110.6 million this quarter.

Everbridge Total Revenue

Everbridge's quarterly revenue was only up 7.36% year on year, which might disappoint some shareholders. However, its revenue increased $2.3 million quarter on quarter, a strong improvement from the $8.86 million decrease in Q1 2023. This is a sign of acceleration of growth and very nice to see indeed.

Next quarter's guidance suggests that Everbridge is expecting revenue to grow 2.11% year on year to $113.8 million, slowing down from the 15.1% year-on-year increase it recorded in the same quarter last year. Ahead of the earnings results announcement, the analysts covering the company were expecting sales to grow 6.31% over the next 12 months.

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Key Takeaways from Everbridge's Q2 Results

With a market capitalization of $1.18 billion, Everbridge is among smaller companies, but its $218.9 million cash balance and positive free cash flow over the last 12 months give us confidence that it has the resources needed to pursue a high-growth business strategy.

The quarter itself was fine, with revenue and non-GAAP operating profit beating expectations slightly. On the other hand, its full-year revenue guidance was lowered and missed analysts' expectations. While full year guidance for lines below revenue were largely maintained, the weaker topline outlook is a major negative. Additionally, next quarter's revenue guidance missed Wall Street's expectations as well. Overall, this was an ok quarter for Everbridge combined with bad guidance. The company is down 3.91% on the results and currently trades at $28 per share.

Everbridge may have had a tough quarter, but does that actually create an opportunity to invest right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.

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