Growth Acceleration Continues
Raises Fiscal Year 2022 Revenue Guidance
E2open Parent Holdings, Inc. (NYSE: ETWO), a leading network-based provider of a cloud-based, mission-critical, end-to-end supply chain management platform, today announced financial results for its fiscal third quarter 2022 ended November 30, 2021.
“I am extremely pleased with our exceptional performance in a very dynamic environment,” said Michael Farlekas, chief executive officer at E2open. “We outperformed our key metrics in the third quarter and organic growth is accelerating– all while integrating our largest acquisition to date. The BluJay integration is ahead of plan and reinforces our view of the large strategic value and financial accretion the transaction delivers to E2open.”
“Moreover, the market recognizes the strength of our supply chain operating platform and its ability to solve one of the most important and challenging problems companies face today–visibility and control to operate their global supply chains as one connected system,” Farlekas added.
Fiscal Third Quarter 2022 Financial Highlights
NOTE: Non-GAAP revenue adds back amortization of the purchase accounting fair value adjustment to deferred revenue resulting from the business combination with CC Neuberger Principal Holdings I (CCNB1) as required by GAAP. The Company is adding this back to provide better comparability in the calculation of our organic growth rate. Refer to the Reconciliation of Non-GAAP Information Table and Pro Forma Reconciliation Tables at the end of this press release for more detail.
- Revenue
- Total GAAP revenue for third quarter of 2022 was $137.0 million compared to $84.1 million in the prior period. Total non-GAAP revenue was $147.4 million compared to a non-GAAP pro forma of $129.5 million in the prior third quarter,reflecting non-GAAP revenue growth of 13.8%. The prior period non-GAAP pro forma total revenue of $129.5 million represents the combination of E2open total revenue and BluJay total revenue for the period, as if BluJay was acquired on September 1, 2020.
- GAAP subscription revenue for the third quarter of 2022 was $107.0 million compared to $70.4 million in the prior period. Non-GAAP subscription revenue was $117.4 million compared to a non-GAAP pro forma of $105.6 million from the prior third quarter, reflecting non-GAAP revenue growth of 11.2%. The prior period non-GAAP pro forma subscription revenue of $105.6 million represents the combination of E2open subscription revenue and BluJay subscription revenue for the period, as if BluJay was acquired on September 1, 2020.
| (in millions) | Q3 FY2022 | Q3 FY2021(1) | $ Var | % Var | ||||
| Total GAAP Revenue | $137.0 | $84.1 | $52.9 | 62.9% | ||||
| Deferred revenue purchase accounting adjustment | 10.4 | – | – | – | ||||
| Pre-acquisition revenue | – | 45.5 | – | – | ||||
| Total non-GAAP Revenue | $147.4 | $129.5 | $17.9 | 13.8% | ||||
| GAAP Subscription revenue | $107.0 | $70.4 | $36.6 | 52.0% | ||||
| Deferred revenue purchase accounting adjustment | 10.4 | – | – | – | ||||
| Pre-acquisition subscription revenue | – | 35.2 | – | – | ||||
| Non-GAAP Subscription revenue | $117.4 | $105.6 | $11.8 | 11.2% | ||||
| GAAP Professional services revenue | $30.0 | $13.7 | $16.3 | 119.0% | ||||
| Pre-acquisition professional services revenue | – | 10.2 | – | – | ||||
| Non-GAAP Professional services revenue | $30.0 | $23.9 | $6.1 | 25.5% | ||||
| (1) Non-GAAP pro forma inclusive of BluJay as if acquired on September 1, 2020. Refer to the Pro forma Reconciliation Table at the end of this press release for more detail. |
- Gross Profit and Gross Margin
- GAAPgross profit for the third quarter of 2022 was $64.2 million compared to $52.2 million in the comparable quarter of 2021. Non-GAAP gross profit was $103.4 million compared to a non-GAAP pro forma of $89.6 million in the prior year’s third quarter. The prior period non-GAAP pro forma gross profit of $89.6 million represents the combination of E2open gross profit and BluJay gross profit for the period, as if BluJay was acquired on September 1, 2020.
- GAAP gross margin for the third quarter of 2022 was 46.9% compared to 62.1% in the comparable quarter of 2021. Non-GAAP gross margin was 70.1% versus a non-GAAP pro forma of 69.2% when compared to third quarter of 2021. The prior period non-GAAP pro forma gross margin of 69.2% represents the combination of E2open gross profit and BluJay gross profit for the period, as if BluJay was acquired on September 1, 2020.
| (in millions) | Q3 FY2022 | Q3 FY2021(1) | $ Var | % Var | ||||
| Non- GAAP Gross profit | ||||||||
| E2open | $103.4 | $59.7 | $43.7 | 73.2% | ||||
| Pre-acquisition gross profit | – | 29.9 | – | |||||
| Total Non-GAAP Gross profit | $103.4 | $89.6 | $13.8 | 15.4% | ||||
| Gross margin % | 70.1% | 69.2% | ||||||
| (1) Pro forma inclusive of BluJay, as if acquired on September 1, 2020. Refer to the Pro forma Reconciliation Table at the end of this press release for more detail. |
- EBITDA and EBITDA Margin
- EBITDA for the third quarter of 2022 was -$14.6 million compared with $16.9 million in the comparable quarter of 2021. Adjusted EBITDA was $45.9 million, an increase from non-GAAP pro forma adjusted EBITDA of $45.2 million in the third quarter 2021. The prior period non-GAAP pro forma adjusted EBITDA of $45.2 million represents the combination of E2open adjusted EBITDA and BluJay adjusted EBITDA for the period, as if BluJay was acquired on September 1, 2020.
- Adjusted EBITDA margin for the third quarter of 2022 was 31.1% versus a non-GAAP pro forma of 34.9% in the comparable quarter of 2021. The prior period non-GAAP pro forma adjusted EBITDA margin of 34.9% represents the combination of E2open adjusted EBITDA margin and BluJay adjusted EBITDA margin for the period, as if BluJay was acquired on September 1, 2020.
| (in millions) | Q3 FY2022 | Q3 FY2021(1) | $ Var | % Var | ||||
| Adjusted EBITDA | ||||||||
| E2open | $45.9 | $28.3 | 17.6 | 62.4% | ||||
| Pre-acquisition adjusted EBITDA | – | 16.9 | – | – | ||||
| Total Adjusted EBITDA | $45.9 | $45.2 | $0.7 | 1.5% | ||||
| Adjusted EBITDA margin % | 31.1% | 34.9% | ||||||
| (1) Pro forma inclusive of BluJay, as if acquired on September 1, 2020. Refer to the Pro forma Reconciliation Table at the end of this press release for more detail. |
- Net Loss: Net loss for the third quarter of 2022 was $64.3 million compared with a net loss of $27.1 million in the comparable quarter of 2021.
- Cash flow: For the nine months ended November 30, 2021, cash provided by operating activities was $28.2 million compared to $30.1 million in the prior year period.
Recent Business Highlights
- E2open continues to build out a new logo sales team to drive performance in organic revenue growth. Nearly 30% of new bookings in the third quarter of 2022 came from new logos, compared to 15% in the third quarter of 2021.
- Average enterprise new logo contract size (over $100k of annual subscription revenue) was more than double that of the third quarter 2021 which was around $200k. This reflects greater scope, scale and pricing for initial client engagements.
- E2open recently launched “Global Logistics Orchestration” a network-based product that enables our customers to orchestrate materials and finished product to move across their network of carriers, across modes, regardless of whether movements are initiated by internal logistics teams or third-party logistics service providers or both.
Financial Outlook for Fiscal Year 2022
As of January 12, 2022, E2open is providing non-GAAP guidance for the remainder of its full fiscal year 2022, which ends February 28, 2022, as follows:
- E2open is increasing its total non-GAAP revenue guidance range to $474 million to $476 million reflecting a 10.2% organic growth rate at the mid-point.
- Adjusted EBITDA is expected to be in the range of $161 million to $163 million.
- Non-GAAP gross profit margin is expected to be in the range of 70% to 72%.
Quarterly Conference Call
E2open will host a video webinar today at 5:00 p.m. ET to discuss fiscal third quarter 2022 financial results, in addition to discussing the Company’s outlook for the full fiscal year 2022. The video webinar will be available live on the Investor Relations section of the Company’s website at www.e2open.com. A replay will be available within 12 hours after the conclusion of the live event.
For more such updates and perspectives around Digital Innovation, IoT, Data Infrastructure, AI & Cybersecurity, go to AI-Techpark.com.
