BELLEVUE, Wash. - Smartsheet Inc . (NYSE: NYSE:SMAR), a leading enterprise work management platform, has announced its financial results for the first quarter, which concluded on April 30, 2024. The company reported a significant year-over-year revenue increase, with total revenue reaching $263.0 million, marking a 20% growth. Subscription revenue, which constitutes the majority of the total, saw a 21% increase to $249.1 million.
The company's operating cash flow and free cash flow both experienced substantial year-over-year increases, with operating cash flow at $50.1 million and free cash flow at $45.7 million, up 47%. Smartsheet ended the quarter with a strong cash position, having $669.5 million in cash, cash equivalents, and short-term investments.
A notable operational highlight for the company is the growth in annualized recurring revenue (ARR), which rose 19% to $1.056 billion. Moreover, Smartsheet now boasts 72 customers with an ARR over $1 million, a 50% increase from the previous year.
Despite these positive developments, the company reported a GAAP operating loss of $(11.1) million, an improvement from the $(32.1) million loss in the first quarter of the previous fiscal year. The GAAP net loss also narrowed to $(8.9) million, down from $(29.9) million in the same quarter last year.
In terms of future financial outlook, Smartsheet anticipates total revenue for the second quarter of fiscal year 2025 to be between $273 million and $275 million, with non-GAAP operating income projected between $38 million and $40 million. For the full fiscal year, the company expects total revenue to range from $1.116 billion to $1.121 billion, with non-GAAP operating income between $157 million and $167 million.
Smartsheet also announced the launch of an inaugural share repurchase program, authorizing the buyback of up to $150 million of its Class A common stock. This move reflects the company's confidence in its financial health and commitment to delivering shareholder value.
The company's CEO, Mark Mader, expressed optimism about Smartsheet's trajectory, citing significant demand from enterprise customers and a strong start to the fiscal year. Mader anticipates the new product innovations and go-to-market strategy to position the company for sustained growth.
This financial summary is based on a press release statement from Smartsheet Inc. and presents the company's performance and outlook without speculation on broader industry impacts or trends.
In other recent news, Smartsheet Inc. reported a strong start to the fiscal year, posting a 20% increase in total revenue year-over-year, reaching $263 million in the first quarter. The company's adjusted earnings per share were $0.32, exceeding analyst expectations of $0.27. Demand from enterprise customers drove these results, with Smartsheet now servicing 72 customers with annualized recurring revenue over $1 million, a 50% increase year-over-year.
In terms of financial performance, Smartsheet's subscription revenue rose 21% year-over-year to $249.1 million, while the company's GAAP operating loss improved. Looking ahead, Smartsheet expects second-quarter revenue to be between $273 million and $275 million, with adjusted EPS guidance for Q2 set at $0.28 to $0.29, above analyst estimates.
The company's full-year revenue is anticipated to range from $1.116 billion to $1.121 billion, with an adjusted EPS forecast of $1.22 to $1.29, higher than analyst projections. In another development, Smartsheet announced a $150 million share repurchase program, a clear sign of its confidence in its financial health and future prospects. These are among the recent developments for Smartsheet.
InvestingPro Insights
Smartsheet Inc. (NYSE: SMAR) has demonstrated a robust financial performance in the first quarter of fiscal year 2025, with notable achievements such as a 20% year-over-year revenue increase and a strong cash position. While the company's strategic initiatives and optimistic outlook from the CEO are promising, it's important for investors to consider a comprehensive set of financial metrics and expert insights to fully understand the company's valuation and potential.
InvestingPro data highlights that Smartsheet's market capitalization stands at $5.2 billion, with a revenue growth of nearly 25% over the last twelve months as of Q4 2024. This is consistent with the company's reported increase in annualized recurring revenue (ARR) and suggests a solid trajectory in its core business. Moreover, the impressive gross profit margin of over 80% underscores the company's ability to maintain high levels of profitability on its products and services.
However, the company is trading at a high Price / Book multiple of 8.58, indicating that the stock might be valued richly relative to the company's book value. This is a crucial point for investors to consider, especially when the stock is trading near its 52-week low. Despite this, analysts remain optimistic, as evidenced by 15 analysts revising their earnings estimates upwards for the upcoming period, signaling confidence in Smartsheet's future performance.
InvestingPro Tips further reveal that Smartsheet holds more cash than debt, which is a positive sign of financial stability. Still, there is an expectation for net income growth this year, with analysts predicting profitability for the company within the year. While Smartsheet does not pay dividends, which may be a consideration for income-focused investors, the company's growth prospects and potential for capital appreciation could be appealing for growth-oriented investors.
For those interested in a deeper analysis, InvestingPro offers additional tips on Smartsheet, providing a richer context for investment decisions. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and access the full range of insights that can help navigate the complexities of the financial markets.
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