BCOV - Earnings call transcript Q1 2019

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Operator

Greetings, and welcome to the Brightcove First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Brian Denyeau from ICR. you. Thank

begin. may You

Brian Denyeau

the welcome Financial be first in discussing after Rob me release and Chief Ray, call. Officer Executive our XXXX Today, issued and on With close. we'll the Brightcove's market are to afternoon, Jeff quarter Brightcove's Chief Brightcove's Noreck, earnings press call Officer. Good results announced

of ability of Litigation execute the we'll make maintain customers, existing to that Act forward-looking of considered be made well including call, on our XXXX statements pursuant XXXX, and business our new statements as Securities quarter year and as to During financial our the go-to-market our position strategy, and growth Safe the the our of XXXX, our to provisions and our expand guidance Harbor may Reform second related full to Private are ability customers. upsell expected to concerning our the acquire fiscal ability to profitability, position, leadership for

may often similar indications Forward-looking or such reflect These not future expectations. and of expect, our our should upcoming be statements we today words statements only anticipate, of as we identified with views as be as subsequent These variety from expectations. of are our representing date. cause a reflected uncertainties of subject to any to that and differ materially as statements risks could upon results views actual

schedule our close financial issued showing our non-GAAP today, affect the to currently most that filings. updated For press please market can those as and reconciliation in release our other website a call, SEC GAAP a risks discussion be which XX-K in available our of we annual results filed today's recently Also www.brightcove.com. course actual results, could refer report material There's in our important factors other to contained on certain by and at during will of versus refer after found Form non-GAAP measures.

our operations the Rob with our well additional results, our as of and year a details provide regarding me on as strategy. second the for of of results, an summary and Jeff. a turn call, full that, the to will today's outlook agenda financial quarter our terms review With let of XXXX. our first update quarter review In for call over finish XXXX Jeff will the

Jeff Ray

products customer improved our encouraging that the product easier meaningful strategic do initiatives are business and indication all service you, we and and made the generating that organization customers our rates first improvements a start We've to Brightcove. the into our growth, sustainable joining revenue quarter you at profitability Renewal Brightcove is XX%. for Brian, trajectory Thank first plan the thanks quarter solid future. renewal meaningful base with business value consistent to performance. significant, development positive today. and will built making have to that of in our believe on which during executing process to organization and We of we to us business the strategic The strong delivering on made go-to-market are and an deliver services new accelerate progress enable growth remain and it in rate and

excellent the developed an analysis. roadmap progress product review market update we well of on as the the a commitment we're the our acquisition quarter, the of provide high-end financial million, to to above and EBITDA was was like our year-over-year I'd of few guidance, online on first take quarter conjunction made during some adjusted innovation to video platform to standpoint, with Ooyala's $XX.X results growth. and $X.X quarter. up guidance above From for reflects we of X% first the of profitable business. Turning well in to our moments revenue briefly the business high-end an as the We improvements and million, delivered making which our our

$X.X recall, we've XXXX a customer XXXX. that identified CAGR distinct have grow will billion to $X.X estimates, by at you'll XX% in markets that IDC As billion end totaling nine

We and of and new paying the could delivered experiences. list targeted drive will already off features our in that will of greater to our the segments. and that committed enhancements innovations be rigorous the of on marketing this initially target feedback identified platform needs our sales. announce market based approach, time We're the four address share OTT most from Through customers XXX% packaged core that new to specific well these confident leverage ROI-based of the the have of target I'm received who've targeted methodology product of a in QX. this we with vision we've also with roadmap a that preview product are process, can our on needs is as world. is to the We've and we business focus segments, pressing with strength which been excited and including result sales, delivery of as our customers on products seen pleased thrilled timely

We in deliver also growth. that substantial in made putting pieces breakout to selling a create the model can predictable progress place

a dollar that target can repeatable and customers. effectively targeting opportunity multi-billion motion all are market sales We a we need

We are strategy, on as confident generate that meaningful growth. our we will we execute

marketing our It's senior new an video ownership content targeted top Rick potential tremendous providing customers. embracing accountability Our marketing instilled programs over group of Video distribution a which identify few Southeast This CA research our one of Billy an generation organization, entire first business in demonstrating has improved The includes a to strategy on generation ROI-based team team tutorials In who addition impactful high-quality increased will and pieces significant Masterclass. President, video the and positions been EMEA. is across interest level Sales in and Hanson proving and lead content the are in sales Senior recently, ROI experienced is A Rick aligned marketing our of past the with sales ensuring the Brightcove are for sales developing program market area seeing with for to from are e-commerce marketing business demand It has focus is key we a roadmap objectives. cost-effective, and while team AppDynamics. measurement. more our we was Chief An as that and of at most months product example sense the Vice marketing strategy, Technologies most made new and to of drive rigorous and urgency, even added the launched teams to our aligned first work executive his class O'Riordan that to most saw of popular held leader marketing we leads. done progress organization, generation development of methodology sales who on recently he production ensuring including and Australia, the sales is and In the performance. the achieve held as Asia has pipeline a job, his He's year. leadership demand education-based a organization professionals Billy material Officer. increase effective talent, Revenue the is driving campaigns sales International on demand our guide engagement In analysis sales campaigns. and spending is help our as program to flat. quarter, in Marketing history,

structure As with more business new one, activity, and allow new retention part exclusive process. another generation. effective in focus specialized on believe on customer of us us with the while our this process, teams, this to we We sales making aggressive are will sales creating renewal be more

on have we released purpose-built solution customers. the is the sales will value delivering growing product, our across quarters, organizations a in As focused number a marketing coming to aligned go-to-market new tightly of and

will have I know feel identified business to to drive what benefits good the enabled of the achieve. already well start second to the the changes And believe see But I our do We team more the go-to-market of that to we making half work results can we year. is working the we organization. in in this are get have we

already starting in traction to marketplace. see We the are

not market The their dedicated Flow The and the video Brightcove individual one included a property great with example Southern and injury the the intend upon updates. healthcare apps. of relationship manage be list through websites, to a community the technology of The to power for expanded video. users' meet CaringBridge new organization connection global planning to to quarter. use include their we're CaringBridge leader. system most post local India, websites integration bring OTT great is of and with in are to personal which a from and of to a use its customer. expertise free OTT company's is market. and illness of CaringBridge MMTV organization human broadcaster members and development on fulfill well-known journey Brightcove's Brightcove the the or pages. payment proud launch. a is wins during approaching have the OTT is updates have to devices. Manorama platform Limited, enables allows community rely communication to business SSL. Flow. platforms requirements, which June an CaringBridge allow as team on with will can a share the domain the quickly first chose personal Adding site created Brightcove's they and their for network does is team social to six Instead launch for Brightcove and and more the MMTV vibrant technical minutes. the to to post personal A existing Users every Mazhavil which marketing used Here respected some individual growing company across an OTT We to segment, widely to easily through of news From coding the communicating proposed the also a sales non-profit to

cloud trusted their take strategy. in As many step video customer video MMTV years, thrilled a we this are Brightcove successful Limited next for to

online on excited Ooyala. our Ooyala's Brightcove of to April affirms video OVP close to welcome to Xst, Turning customers leadership the thrilled We the which family. We business the Ooyala acquisition in were were industry. to

OVP to succeed. with excited growth. and personally. our for focus and new located. two we Feedback opportunity employees their senior even to members are video I passion committed get been and help them, for I recently video in helping the journey Guadalajara, group by our Mexico us to is former team customers and joining XX our see several on This Customers more of joined their provider how in part from thrilled breakout inspired return to eager in roadmap office more one partner Brightcove them their will that have to the as leadership was Number I of had our be a each was is has than by our with have spend. where learn We at more have engage contact are singular person Ooyala an encouraging. been than to their are dozen team

value support seen the our very progress to and behind will OVP For example, in two The on us to me because are chance we provide that power Eastern would sales, that the means up across opportunities Brightcove customer what aspects have the come all customers. carve-out giving growth. in a hours driving we two Ooyala immediately teams. the savings of sought and several our product, early they the align deliver making resources daylight hours to to the now were change few motivated first work with adding initiatives. We're Boston pleased initiatives choosing with We're good breakout weeks of accelerate time, talent for finance engineering, delivers noted and business will marketing, and assets Brightcove. growth to that to people and for us do the increase our Company, skills We're they

our and with the will an We product video leverage strategy. a heritage go-to-market that in easy-to-use our is experts portfolio with organization leading as expanded aligned

call in employees faith who dedicated our I in are Rob? is reach over would plan let to numbers. our potential execution changes our people strategy walk a appreciate and making full our I Rob we that, the to growth. turn company. that thank through the to can With the of all you their smart, full me we as embrace believe for Finally, to like Brightcove for so video. their things excitement

Rob Noreck

our begin by quarter the outlook with driven revenue quarter the review Thank in and was you, our The Jeff of our Overages second down revenue specific continue Total outperformance the by which our will million. trend, guidance remainder $X.XX detailed and above quarterly was historical was support we our first revenue I'll with came in everyone. further, subscription of good noted $XX.X and above I comfortable and then million the a full-year $X and million, for range. finish that earnings overage XXXX. was first with year. quarter $X.XX modestly our afternoon the few for and quarter the to events. variable Breaking professional target million target revenue call, revenue million below on be services remain so fourth $XX.X driven a we was

our earnings last future define of on our to performance be a further, Breaking and quarter. was useful revenue looking multi-year a bit $XX.X during investors our XX% We transactions. In in from international year-ago noise revenue period. first backlog generated end more, basis, track, on during of million useful amount obligation. we is changes XX% backlog quarter, committed On geographic Breaking discussed and XX% in little we this increased to performance subscription of backlog revenue generated we backlog XX-month call, duration Asia-Pac to backlog the revenue backlog up As quarter This a aggregate XX-month unpredictability the related our the from believe of metric North track initiatives. of the XX-month down the our strategic the $X.X most as and at our executing subscription down and Japan America generated internationally. at quarter. the million the during large eliminates believe as metric it X% XX% the for the revenue or of subscription will Europe to

turn now metrics on share a supplemental to basis. me quarterly the Let we

was of in XX%s. with in was Our The renewals. recurring driven by in the dollar low-to-mid was line strength range quarter which target quarter rate our growth strong the first retention XX%,

pleased are having with our is impacts the the and performance the We in customer on retention. focus quarter success renewed on

the quarter were of Our of customer as which customers. premium end X,XXX, X,XXX count the first was at classified

base, starter note these was was April annualized transaction, Looking $XX,XXX, for premium revenue impact metrics customers, excludes at per do which our include Please not averaged which pricing our our Ooyala on X% premium the from in ARPU year-over-year and within customer annualized closed entry-level up any $X,XXX customer which Xst. revenue.

GAAP the gross was loss on $X.X our operating and a $X.XX was profit loss per quarter. at basis, results $XX.X share Looking our million, was million for

Turning to results. non-GAAP our

on and quarter the of $XX.X approximately to the and share million XX.X margin per shares gross in the based on our of loss total to for XXXX. quarter share non-GAAP net profit of weighted the a Non-GAAP revenue. was of for and Our XX%. the per average quarter. period first was $X.X support was outperformance first in gross quarter period. gross was overage year-ago outstanding guidance Subscription primarily $X.XX of gross quarter in This quarter XX% million compared first in the range year-ago outstanding. million $XX.X represented EBITDA XX% million represented to compared in compares $X.XX weighted in Non-GAAP shares income revenue generated year-ago compared XX.X to $XXX,XXX quarter earnings in profitability and Adjusted margin the an high-end operations driven a loss XX% a period $XX,XXX the was the by to of our the XXXX. The margin in above compared average operations from from the better-than-expected non-GAAP first revenue $XX,XXX of the million

Turning to $XX.X quarter million. and and we cash sheet flow, ended balance cash the of equivalents with the cash

software. and account into $XXX,XXX expenditures after the XXXX. of of operations to by to Ooyala's $X.X full-year million of was the During second issued which The flow now was Subsequent capitalized newly guidance we flow for providing consisted generated the we from purchase I'd and $XX shares. the in end $X.X and of acquisition and price taking cash free $X.X approximately negative capital in quarter first million quarter, our $XXX,XXX cash closed finish business. quarter, like the million cash Brightcove internal-use OVP million,

approximately For outstanding. the loss loss million of EBITDA to revenue share the non-GAAP to of $X.X services are is expected and Non-GAAP perspective, million expect professional $X.XX to million including $X.XX revenue. second million of million. targeting to a average $X.X to $XX.X XX.X From quarter, $X loss of range based shares operating we profitability in $X.X of adjusted million $XX weighted be $XXX,XXX on million, per we net a

our has As expenses consistently second due reminder, the conference. higher to a quarter PLAY marketing and user sales

our guidance our to of updating Turning for million. are a XXXX, to we $XXX revenue full-year range the outlook $XXX to million

overage approximately forecast the to of revenue year. or for continue We the quarter million $X.XX year for per of the $X remainder million full

million In million $X.X operating EBITDA terms and adjusted to of $X.X $X.X non-GAAP of income profitability, we of $X million. to expect million

on average weighted In expect net and addition, based we outstanding. per share $X.XX non-GAAP shares income of million XX.X $X.XX

and includes operating contribution $XX non-GAAP revenue full-year EBITDA the revenue of Ooyala. adjusted million guidance million from profitability approximately updated acquisition Our of of and $X income and

cash $X drivers to are we the a in outflow expect million two in our of to forecast. flow, change For cash full-year range There cash flow even. primary break free

First, that as increasing we software deal-related improve good progress capitalized we included profitability. we expense, and original we our will were of strategic goals the not initiatives business will OVP one-time work for roadmap, expenses Ooyala $X.X summarize, breakout approximately second, against our million in incur on growth of our made To also to product and have our reach guidance. an

achieve making objectives, to the investments committed productivity driving our Company. are necessary improved across while We to the

With begin we are confident our We that, will and against very take feel on we achieve strategy focused plan questions. to about ready your executing breakout Q&A. now are our to growth. Operator,

Operator

question Riley. Please Our from ahead. [Operator Sameet Instructions] B. here from is go first Sinha

Sameet Sinha

time give seems help professional like with A the who of just Ooyala, that And services, you couple the marketplace? Rob. the about that interested margin you it for could gross us guess, Rob, business And you what in from future what margin away pushing of you next can are of I us are so that line does specifically starting not something be? you if profile are insight I terms have think seeing else? questions are any surprised we report? that quite just you Is have is are a number bringing then significantly. some down it business just follow-up. it or Can indication this And

Rob Noreck

sure. Yes,

scale. So as to that you margin past really a it can much is imagine the than Ooyala on company. are that's in lower Brightcove's their you've related seen the market, smaller somewhat They

specifics going a lower. is bit we're around So to little that, give but not it

to until that result You'll out-quarters see the slightly as come down on the in margin unified of get we platform. a one

terms good into the we brought anything it for In more seeing revenue of sight PS question, We're the have sold line we of in in your down. mix right the quarter. a that we of specific PS Obviously, now, of QX. not marketplace deals

Sameet Sinha

forma EBITDA? And that in said adjusted pro for number you operating you million is Ooyala, or in terms it of provided the income $X

Rob Noreck

both. Yes,

of didn't depreciation pick As right now, assets. any any or material fixed up we

Rob Noreck

a question. final then And

So -- fill about Mexico. you from -- XXX reqs How of XX your many to be open are that had you some of kind hired in people incremental -- would base? requisition, them Ooyala, help of Brightcove at some these in about you your versus

Rob Noreck

standpoint, accelerate we we reqs and roadmap acquisition. open Yes, capacity I then that to picked up at certainly provides the in Ooyala there. from some GDL good And of also Brightcove the out the us those We a items had had site think for it from it's mix. additional some skills of

Operator

Our from go from question Steven next Dougherty. is ahead. Frankel Please

Steven Frankel

us that fact talked were on with you bookings. to wonder you Last color about if quarter, they might I the some start disappointing.

little feeling color specific maybe say around bookings QX in you're shaped a and the looks how how bookings QX? better, but pipeline more up about did in You

Rob Noreck

I'll feel doing We you all is half. very, disclose to call. about that and about you momentum is very, no the if year-over-year. backlog, saw Yes, making and continue longer-term second good but the tell doing. the good we for not very up backlog good goals Thanks remember feel year. for bookings, we feel longer marketing Steve, We that very the that the to things X% sales bookings. on XX-month continue good positive we which the decided really guide about was report on some our we on we'll And to

Steven Frankel

but looking for was on understand the QX? And could I the opposed that You presentation, color us year-ago, the Again, gave but number some that. as previous I backlog was quarter? more to yes, you what us numbers, give in

Rob Noreck

$XX.X it's million. Yes,

up $X.X So it X%. about million, was

Steven Frankel

and on And still do? of low-hanging a you target was how is be on then areas are Okay. might fairly of something Jeff, to that, quickly that VAR you identified if early still looking fruits to able on one Is channel. execute the it the list you

Rob Noreck

We Yes, to don't the XXXX. bookings, we is it -- even that is going been though that we've that I talk And good more all made. be think feel impactful the more still key don't on to on progress We've the until saying about strategy. that's it's along. about growth bookings/backlog.

register We become actually have very applicants easy automated, launched layers We've an or several of partnership. partners. other makes online portal it identified and that kinds of is resellers it to for

now. easy support to was a now OEMs doing so of traditional part the was get are he's the effort good it have good of and need introductions just a very and them also that side, pretty as had for and right resellers well major strong academy relationships an of to We there the to it partners with there. part beyond He's be sell of in who a very, our the some thrilled Ooyala job happened online just there. makes those that accelerating great us our represent there job products. the And to and that they happening doing with team Also out very skills leader

Steven Frankel

if you factored Jeff, get granular? flat then what's you what is And to the that update of level on guidance what's and expenses want business Ooyala full-year kind us flat, the about Maybe attributable to into holding OpEx had core versus XXXX. talked expense in

Rob Noreck

attributable adjusted op and million a you number op and guided million inc Ooyala, to what's we when about number. so $XX adjusted inc, think $X a to EBITDA Yes, revenue

business holding million of got you fairly in rest about of constant. $XX there So expenses with the the

Jeff Ray

fiscal And remainder remaining again, -- the that's of the year? for

Rob Noreck

Yes.

Operator

Mike from go question from Capital is Please here Markets. [Operator Latimore ahead. instructions] The next Northland

Mike Latimore

go all subscription Ooyala, pretty the much million all that into right? that -- guess will on $XX is guess that revenue, I I

Rob Noreck

Yes.

Mike Latimore

should revenue point as Ooyala being Okay. or growing? And think stable the of stream at we at this

Rob Noreck

we with Yes, out roadmap see as the and out fill we those launch opportunity new and fairly Obviously, customers unified we products platform. stable. our build

Jeff Ray

migration. in the we I there Jeff. opportunity with and we are if if pretty of could we through see good and is we really those engage -- for have, apps global an offerings best taking and encouraging. want personally that been the be unified more will, of this got selling to be the deliver. a products and into will that the make of target to If disruption has very unified anything, talked that. dozen Yes, that We've product customers to to We've are customers this those up a platform. sentiment opportunity through job back don't very, single world. services base two add nervous going about the to the will not We've of suite by the team than up big all you they're these future done They're sell concern the additional crawl and that great the Ooyala platform Ooyala the the there encouraged in Their platform. it's sell guided about future apps, the there that

month. three customers moving Before one this Ooyala a transaction happened, were to we

our so, them already to team cloud team move And to and migrate ops how our knows knows services data. how

us. to new not So this be will something

Mike Latimore

Social, are your in [Indiscernible]. that or among features Live are any then enterprise particularly customers, there And demand,

Jeff Ray

various know got commented They're event Live particular. I is -- That's attention as Vegas. about Live. of we'll at value getting a starting anything solid. event the they I the very reasons of one at growing mature is PLAY that for in in that to understand May. think the lot more customers stages all Las that be there. of these the and they're at NAB can't Demand maturity, OTT I are It's of starting in we on the why recognition talking more and

Operator

turn back teleconference, this Mr. Ray I'd to the any to closing like This sorry, question-and-answer concludes today's for concludes floor comments. session. the I'm

Jeff Ray

and we the this feel Ooyala Thanks in. was of Again, significant you. first catalyst a how good really built it's strategy family. We rest year. those is great for contributing everyone to those we're excited believe of sound. momentum We Thank working. They're that employees we the positioned do a very and part that we dialing customers about of the and quarter. They for our the video. in that growth. being power excited quarter indeed is know about know It the in are about

day. the of very encouraging Have flow has and the feedback profitability a you with Thank during generate to year. to everyone. customers intend continue All cash and been we good

Operator

This concludes today's teleconference.

disconnect time. again your You may lines this participation. at Thank you for your

Brightcove (BCOV) 24 Apr 192019 Q1 Earnings call transcript