SQSP - Earnings call transcript Q2 2021

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Operator

Good evening. My name is Christian, and I’ll be your conference operator today. At this time, I would like to welcome everyone to Squarespace’s Second Quarter 2021 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator may conference. you begin Chiou, your Christopher

Christopher Chiou

operating Relations Good Squarespace’s My second thank Anthony you Casalena, of name today With us for for joining Investor Head quarter some to financial call Founder On for and the share today’s Christopher And afternoon, CFO. both then Corporate non-GAAP are Chiou. and metrics. call, They Martin, CEO, remarks and Development. open refer me GAAP and is questions. results I’m and and and will XXXX we'll Marcela prepared up earnings call. the

find or on substitute pursuant not assumptions from and of in Investor or provisions call financial events. for measures statements statements will I’ll of our Act of turn product Anthony. additional in no GAAP forward-looking You materially the isolation to we those include call we today, new a are update new prepared could factors Litigation be are press calculate differ are Securities company’s the filings should can marketing may at reconciliation detail which this in Relations discussing section not Any the discussed measures forward discussion and of Please SEC to our non-GAAP now August differ. with that those based can to make subject Actual information the today’s take the related for the to on the reconciled we to forward-looking uncertainties metrics results, matters results in statements. These information discussed the to in to and XXXX, a the of as introduction, The website. look and Reform XXXX, results strategy. to release, we include considered including accordance on be These are GAAP. contained result call, forward-looking of that the as over obligation a financial the future Private these risks undertake which a information how with X, SEC. but looking limited this as safe on statements in be cause future and statements Harbor from found

Anthony Casalena

everyone. of Thank Thank Christopher. Casalena, our us a you presentation to joining afternoon, traded we Good name Anthony and quarterly growth And company. first Squarespace. for welcome CEO you, report as for ever My Squarespace. of Founder today strong publicly is quarter a as earnings

this you the get started new be that led to I’d why like details to our we remind may results, to Before Squarespace and exist. some we sharing story. of of the financial audience

on those refer would For webcast, slides. to you the I the

and and Squarespace people our with mission. stand ideas, succeed. First, to creative vision help exists out

workforce more We then, to blog to the use. design look believe customers helped connections transact customers. with more years, succeed, over them over began wanted themselves, consistently I base. they we’ve and company beautifully transact the Squarespace and helped a the turn couldn’t building the they small their differentiate things grow need and and to and in and to because people last build emotionally their that brands as strive best we [indiscernible] with businesses their directly was our a Today, one As with I be leading to ventures, passions customers. choose find and XX their the in and focus to build do audience, build XXXX. on support most are importantly, two tool to to become a build self-employed globally, of loyalty. points matter strongly sell millions XXX anything and products, to express help across professional is brands. to the visually powerful would the and brand. the me believe brands website touch This customers most, global or Since their create up then to that ventures world content, million of grown anything We in both. your of over companies journey customer We there community. power easy And Squarespace services, X,XXX and a and we’ve with created employees,

proudly company. XX million, We subscriptions a months XXXX. are over $XXX now revenue is with We’ve of publicly our million nearly scale of achieved significant which X.X of last June, as is unique traded subscription-based. over all And

XX-month has year-over-year free to as spending We’ve which by XX% margins, this approximately returns margins. speaks flow important achieved on illustrated cash business. grown strong has our Strong on trailing gross efficiently operate always with our basis. been revenue unlevered Our our how a we positive

We We go areas product. our This customers is beyond months. profitability far selling us to sell our our is time financial enablement to physical scheduling also to help content a of continues and compelling with differentiated the that significant selling and an places part from think and have online opportunity million exclusive $XXX believe increasing business. into and expertise our an over profiles. of elite member goods We commerce class product, of revenue with be over companies last anything growth scale, commerce with XX in communities of that offerings the commerce their combination that technology translated

that maintain other We us, the at it runway view there have down market isn’t to overall ample market on It’s an of scale. is advantage our to massive The Our We highly growth total continues other our believe significant and opportunity. that winner scale. we to market all able will is expand. and market ways given approach. believe fragmented, companies us based opportunity. And environment a which be face. are that top may take large ahead We is believe to a addressable

various concluded to expand allow a our of United products own business the continued contribute entrepreneurship, Gen unique websites, is driven product, the or Z’s XX% this or the us also This offers date. quarter formation according intersection products growing to and [indiscernible] opportunity. census. and second Squarespace Z will professionally be of total of most circle, it in commissioned sizing As trends. address to to Tock you new at large components We stores vast hospitality areas social grew member secular believe this trends will Unfold, look Squarespace majority, ambitious XX% market restaurants being our base. their In generation believe products to at On and to to markets. by these States, growth several addressable our subscriptions. Macro online incredibly the XXXX We the Gen part is of in that opportunity large presence start with customer underpins The plan our each via today, our businesses. further the market poll continue U.S.

XX% also of in polled Zs, and online half shift believe than Americans from or for benefiting are and same being of you the how to We how to you than mortar of location. to well-designed present According Millennials it than online offline. Gen business the yourself online a yourself With is more important versus more XX% more a store XX% is present believe important brick website person. have poll, a

commerce we industry remains high that growth a Finally, segment. believe social

are on well So in future. which capitalize positioned the to we

key we believe pillars platform differentiate six Our has us.

entrepreneur to means anything. having First, an brand, all-in-one a with build their tools, customers and online, fully of shop platform. an This connect we needs integrated online suite have sell

to of being make core of consistent across the easy points. everywhere. touch our products the beautiful Design in design Second, consistent we and it we all brand keep multiple believe is

our Third, our let anything. sell platform customer

in Simplicity professional with Our physical believe simplicity. commerce content. quickly or selling for to far beyond marketing whatever’s and our to in values to as sell we next tools, we modern power commerce make difference goes can customer support. results sixth our platform just capabilities, is grade our We also to intend built Squarespace, evolve you deliver customers. social cases. beyond tools use easily. have corporate and broad of will is we’re products a Fourth, always from And With Fifth, goods. expertise our for website time, one continue to investment

one in in-house high customer and invested having best-in-class, team. always of we’ve team is award-winning Our a the quality support support

our customers fleshing journey a online seek has part for that of of having online. the scaling, an are piece journey. Our every customer ideas when for tools step to have grow alive through their out Squarespace come that of From customer’s brand moment products very provide and we Presence. growing our and idea journey, every to

out and everything verticals. of right We’re thousands digital Squarespace, a of a else industries our leader up tools that in a and keen you box. And our help website get to could All require allow you might customers domain you course professional get of product might cost all a create websites design dollars. with need across the online. of set customers quality otherwise With nearly we might agency often tens and

Google We’re also reseller a of workspace.

email domain branded get in can our So well. customers as their

and which features we support, purchasing, new otherwise improve Unfold, organizations methods For offering our dedicated with require. relatively brand custom people might larger called advanced their customers, leads social have enterprise, contracting across that presences. With this payment priority larger that a app bulk combines the and

website. that our to acquisition expands journey a starts every and acknowledging This social brand customers with consistent funnel exciting are a allows We our not maintain on media.

presence. Social

buyer businesses as a of downloaded million in stand their creators it media. and XX launched of over out With small which of to and X across app Unfold, led dozens Unfold small as sites, across tended and billion exist keep and has hub medium and top countries. a graphics acquisition websites stories. has brand to and to we And consistent Recently the enable anything. social act to are design social XX creation web. been times deeper experiences in the Unfold, we Selling to and within media buyer user the link

that the of tools a Our that in offering to set with few commerce commerce business platform. believe transact physical best we breadth beyond enable ways the all just We to to entire customers subscriptions, models services for that and customers our have We them supports their capture work diverse solutions content the one commerce. same market commerce business. within for of provides the online the sell

scheduling added a Acuity any acquisition Our of works almost robust industry. that for solution appointment scheduling

revenue and continue ways product significant with our GMV for dollars launching areas we’re billions a believe the on a consistency driver. customers a same will brand in beyond of private the customer our a While be platform. is us. content and processing our member solutions ability multiple differentiator lets Today, transact to commerce All for to monetize key paywalls

Squarespace, of with tools So it brands across and and customers they is Squarespace. the audiences of our can engage every access online. stand platform powerful The brand real their platform the marketing Finally, data out allow manage assets them to all that aspects point integrated? to better touch share fully have though, value our

able and or and systems. shipping third-party our it’s extensions with whether partnerships, via functionality to integrations accounting fulfillment customers marketplace, we’re with our offer Additionally services to synchronization

modern, is that We’re and scale. an stack agile engineering and a led company with built design to technology

Our best-in-class platforms, month. over there’s billions per of build years invested millions broad and hundreds dollars deep both of the We’ve of pages to functionality.

you City, And was a heart towards a our to a are our scale progress company Sydney, innovate that’s take of Martin, leader products Amsterdam, it our we to online CFO, as process of it well. the and when technologies, with providing very our financials. across inspire this Our in we’ve in that, and care thoughtful transaction of a the largest along On business. reservation expanding I services successful customer make international We’ve locations pass diverse in considering who growing through base. successful said, hope as and York capitalize significant we our date. which opportunity. global it’s decided enjoyed as been will us to on That footprint. began approach to And continues pass to We New London, taking I serve to ordering will our our Tock, approach opening and March and XX, you Marcela people, to our on process for hospitality walk established in made integration integration business, the sure overview industry. growing acquired

Marcela Martin

you, Thank for everyone Anthony. And being here today. thank you

public excited our more company, first about a earnings of and the very quarter state even business. We excited our as about are

financial QX remind I of model. the would the like we to our business results, Before through walk you audience

sell assist had subscribe approximately company, of transparent primarily payment annual and We a the company opt commerce presence recurring their subscription-based. we’ve a and share the our partnerships plan. end of on customers our our revenue revenue business agreements monthly that with SaaS based Tock. payment volume basis. transaction or with revenue of to Non-subscription QX, and model. annual relates And to processors XXXX, from our processing As to an business At XX% recently from and acquired customers predictable subscriptions XX% the the is

efficient, highly is model resulting in operating a Our margin. profit strong gross

continue allowed cash us financial our has opportunity expand markets, incremental the Overall, to with to gives cost. scale model to business and attractive and which us Our inorganically. invest us allows organically discipline minimal also to deliver flow

second now talk our about Let’s quarter performance.

deliver As both ahead we over both in revenue quarter, the presence this of the quarter anticipated, was increase Revenue strong bookings expectations. quarter strong growth on an and and driven same came we across last million year, XX% performance of revenue $XXX commerce. by in

representing million ARPU. growth $XXX due which run including scheduling hospitality unlevered the of of services cash Our prior grew of year. and growth also and commerce deliver year-over-year X% rate margin. strong year-over-year million XX% the and Continue QX higher growth, XX% is the $XX.X revenue. adjusted during in a commerce, to by in were as $XX and through We a million $XXX which Bookings rate of XX% X% revenue of EBITA subscriptions $XX of unique a to the end addition run a period and than million driven same revenue represented reached revenue XX% Tock’s annualized million, of free have of annual Tock. the includes or margin to growth XX% in revenue bookings combination our ARPUs grown flow

of growth growth Our strong in revenue XXXX. QX from XX% accelerated XX%

This enterprise of on growth. revenue our the social XX% account revenue We our a for which And Presence our a of quarter we the commerce and workspace, to experience year-over-year. net XX% presence revenue break year-over-year business and sales solutions. basis our and presence plans, commerce. personal into down domains resale and revenue Unfold, Google comprises presence grew

Tock. from Our commerce to hospitality related customer’s services candle basic plan processors campaigns, commerce well business payment as the revenue the advanced compresses our member processor shared that by and hospitality the payment subscription, scheduling and areas, provided as revenue services payment

revenue, commerce We versus contribution this share continues $XX commerce inclusion grow the Our strong commerce have grew of million which revenue our Organically the pie. faster. quarter, revenue top continues grow deliver On gaining XXXX. Tock commerce the to the to of the would in grown of XX%. approximately without and revenue over overall QX XX% total and revenue, commerce

our grow as a of XX% platform of joining also quarter or flows Non-subscription commerce XXX through last merchants XX% a addition mostly of our this to last percentage total of transactional revenue QX, back continues new increase. as the versus continues continuing of end on of well to to our revenue. has XXXX, the grown the represents due processing our revenue Squarespace. pie As basis growing merchants, the commerce represented Tock. year. year, GMV payment total has take of platform increase, non-subscription The through services XX% sales Overall, from total that to as rate points as on revenue increased GMV

We our are about very revenue base. excited growing

represents than revenue And XX% XX% it a Our annual total higher XXXX. year. this has same their compared or to time QX $XXX annual rate rate run million run revenue at to last grown increase

opportunities markets of most expansion and international focused. the be outside the of growth important is one excited our We our areas U.S. and continue to about in very

speaking XX% for revenue representing million. international rate quarter non-English countries XX% pie. Much we the XX% to speaking Canada. the the in reached invest addition, reaching expand growth growth and But the to Our was year-over-year to as almost total year-over-year countries. driven other our offerings million of English performance $XX by grew in of subscriptions continue such UK, Australia, $X.X and a revenue Unique

increase included $XXX of profit QX, revenue. due average as one ARPU year. could or a a fees a This Gross to payment below what Dock multiple and be unique $XXX XX.X% has in may both margin X% versus unique with margin prior per in was strong count the single Squarespace it in fundamentals component year-over-year a largest attractive was offerings. XXXX, commerce the slightly the reminder, presence the consolidation subscription processor to an in profile. where revenue represents complemented potentially for represents mainly QX, by growth subscription revenue, As account of

$XX XX% margins year year-over-year were which listing sales time G&A tuition corporate expenses in and invest Our impacted direct versus million. strong continue almost up grew XX% one R&D, marketing to in to to gross Adjusting allow of the organic grew $XX million profit the prior to growth us by cost XXX% costs one invest our services. G&A $XX continue as to direct and components, year-over-year to timing for we listing and million.

and in in both as dollars percentage to talent, expect engineering, to continue our investments a of absolute marketing make revenue. We and

million Adjusted $XX Our strong reflected in ago. quarter margins year million fundamentals the was are $XX and also versus a measure. non-GAAP profitability in second EBITDA

cash free by factors. unlevered the flow margin the driven from following quarter year Our this prior decreased

in Our in margin. flow the and for of legal the by advisory an sheet. goals about last been times $XXX our end remain the a is million the cash timing in to And on leverage approximately impacted investments reached prepayments, direct particular have EBITDA. from continues cash approximately net related execution. flow expenses, at $XX its listing would financial deliver direct operations time quarter. had million and Normalizing $XX healthy one fees has been We strong Cash or and Squarespace the listing and free X.X months unlevered insurance. almost D&O XX XX% million expenses financial to focused balance audit adjusted of

opportunities Our significant. are

expert our strategic key Our targeted are expansion, geographical acquisitions. continued and multimodal focus commerce areas of expansion solutions, enterprise communities, of

In $XXX activities expect the guidance total million. year $XXX we now for in third cash Unlevered benefits tax between full of expenses flow $X.X of achieve Let’s move are what net million $XX.X and is free from $XX.X and million. million revenue comprised on of flow and cash quarter XXXX. and we of associated $X QX, million $X on between million cash to between operating free interest $X.X to talk expenditures million expecting $XX million. paid about Unlevered $XX.X and between million. Capital XXXX, flow cash

is year increased million flow we reported. between $XXX both million free million flow changed between million on timing And $XXX paid net $XX $XX of and $XXX various and have and million million as extending. unlevered $XXX prepayments interest Guidance Cash of free total we arrangement between our million $XX previously. other expenditures reduce million. insurance has cash to activities $XXX to and million For such $XXX on and and full had benefit guidance, is and cash based tax that of between CapEx primarily our to Capital operating $XX $XXX our million $XXX the previously components $XXX million. from flow expectation D&O to from vendor revenue million expense for now $XXX of from and associated unlevered million million cash

pleased report are intend Analyst our of quarter first Day November announce also to in that we We our year to we public a results. financial this host after third company ever as

We opportunity more Squarespace’s are and the our the to and excited this for future. share on event story

So details to more follow.

the Now, plan. our as ability trends our to industry, addressable large long-term as against well market, the our in execute we on very secular remain total optimistic

Operator

We Panigrahi turn to will first now Siti Q&A. [Operator is from Our question Mizuho. from Instructions]

is Your line open.

Siti Panigrahi

a QX expectation guidance question in the the for for when as thanks well especially what are know public growth think you to my you about in you your to pretty company. Wanted being effecting and presence. both for commerce your factors taking and I strong had of, ask QX, Hey, as QX, congratulation

and into expectation your heading So second wondering half? what QX are

Marcela Martin

Panigrahi. you, Thank Anthony. Thank you, Siti

it. And variance, is pleased asset for continue are and approach down. company to place close us, a are and world, our thank that remind opening has Tock of newly a confident quite end that prudent transaction we economies shutting strategic a we new company very a Siti we up in But are is focused uncertain on taking the be a I Sorry, with acquired at COVID Tock very the Squarespace. March about and the on and with your the question. execution. We you, for and and we everyone feel will both guidance

the We business. more and been very excited about a strong have are quarter delivering we never

this moment. business. in confident highly the And We we that we highly the guidance in are are providing confident are at

Siti Panigrahi

Okay. have appealed. Thank some strength you about for you. Anthony, the in guys competition, product aesthetics of And then Thank also now updated product the that. quality and and your question your you terms of the competitors

at So stand? some did us where it give you color point. this could terms And in competition of

Anthony Casalena

sure. Yes,

very So multiple having having single is positioning. really good about One I to one to from system, ones. websites design on We a easy use tool. focused a we’re system, one design things confident very that of achieve array couple huge remain in able very, our an not looking within of

with you of so some And year, have to site can that going really unprecedented of the throughout kinds the the are platform. coming of improvements end we be to a with the use lot system which to create of sites regards

to So code always to get to resort really to or goal or advanced you that. can the it’s systems really that without ensure design been results like CMS these having things more sophisticated

a that So underway stuff there lot of and I liked. there’s really

different bookings ways have reservations, The depth hospitality other at commerce you really prepaid scheduling lot or offerings, really So or it’s the go. those thing physical of or look to is focused on Squarespace. transact We just not donations member product on can or or that a areas people right? when in I’ve

really in what in think the business. really, you I the that’s deep are in the uptick actually appear commerce numbers those areas. And starting offerings Our with to see

to that the development there. and a been you have. as has So as innovation of this my we always a that, from always required of I opinion to real And us company especially focus going know, think and the kind in mean, competitive direct standpoint two things listing, leader always set do we And all really design end work on the apart. my I those we’ve standpoint is be to product main come been

things up. feel exciting I we couldn’t yes, very But feel have good. so, I – coming And some

briefly thing mention other really that. to I’d like The on

really services-based in. appointments product is and think us And physical You opportunity talked lot we’ve our that’s of scheduling, front opportunity commerce, in where our just commerce about a seen comes this there. multimodal we a huge just of strong in not growth there’s commerce

Siti Panigrahi

color. That’s great. Thanks for that

Anthony Casalena

Sure.

Operator

Young Our next from question from Barclays. is Trevor

is Your open. line

Trevor Young

same comments for you product Thanks. the fixed build vein, some to points. any within or where And but like dovetailing offering payment that sale areas you want that areas while to first gap in point narrative Two two three the flush out or I commerce any maybe accelerated, variable any know Are on made. presence has actually are volumes. commerce those accelerated on then versus I also close to have looking some just to peers a What side, me, just aspirations Great. GMV XX out you’re of like investment? of is component for that the just the segment there near three fee Anthony, or four the if term? points tied key subscriptions, some their think and

us So you within commerce? just unpack moving help of pieces Thank kind the can you.

Anthony Casalena

Sure. just sort where investing. peers we’re I’ll start the of with and product versus

and continued if and e-commerce are scheduling running out in differentiators need you the things you help year, up or probably now big. of really, really Squarespace, tool results? know and you the an we’ve but better, you’re and on with it’s to all from platforms and not has the say forward. always doing ease-of-use eight-year of and simplicity in that there. really our big those to also that there, have approach you’re hopefully, just if really think especially the something components main use selling get that side reflected of making Do been Being you with look levers Do two one an Squarespace if easy we support addition really really Squarespace, and started always think something commerce And see eight it’s is specifically known look we’ve everything investment, platform, there for it’s your been it’s of does, a e-commerce one the in nine I we I doing leader course dimensions, the set well. better to presence to standing of really two I out opinion, you’re would And for in invest run going almost one better of we have more remained said, really sort from what the growth, an We that to my competitors to moving for. this we’re investment us focused Tock’s things, continue

it’s on are with it’s we’re the when to always miss about point of and ask me comes people visual not all you’re really that long app. sale front the use product that mortar well. as sort started And it. that’s bit mean, closing it and or sure brick you’re you that lack out So into pandemic attempting an about if not question for store. of making our very to running ease close now that part built transaction you’re a this people, right app before to a the in-person. the peers, it’s now, a fair, really a we’re independent like, seller, the due presentation, with transaction. gap doing gap in-person of that. more, – main the the of I may as isn't sale of It’s point point we actually of online a solution a I commerce a app sale have gotten at is of as our into We you’re craft and simple with a have merging It’s little do single meant

that So thought to the for started there. pause

to And needs. right now customer third adapt product related platform, product the to it we bigger a the part simple for one their base. bigger But there question think was the portion support the onto we’ll is our merchants the I get was and as that of GMV? that really appropriate

Trevor Young

just varies that fixed of Because but of Can I there? big segment you component is also GMV a with kind maybe grows. pieces payment fee know just unpacking that on subscriptions, a commerce, piece the

growth understand versus commerce, differential trying XX three points between the just which about to accelerated So accelerating GMV points.

Anthony Casalena

Marcela, I would to pass you. it

Marcela Martin

to for Tock. to we a XX% approximately out out. and seen overall there commerce in and of to dynamics of are have XX% growth With remaining Tock, Thanks that, couple only Sure. question. Squarespace relates Well, point the that grew the regards

base [indiscernible] at the and compare of look of you XX% the the subscription Tock The base, of you relates business, margins. now And on the the basically impact on the large majority created has that you because reason that will pie. when non-subscription is services. If gross based non-subscription is is the approximately payment subscription-based also notice business a quarter, of overall the this growth to Tock. the main that of part revenue an for And processing which

margin, And our look the been able other this if the that is gross adding of areas component. at other a have margins little. overall Tock that including anticipated, a we Tock, offer make we to grown has see had services mostly we find growth have the So of And you within all all of that dynamic synergies but services XX%. because as platform. erode a Anthony that strong through the of GMV consolidated, on And scheduling and Squarespace, the for

Trevor Young

you. Thank Great. Both.

Operator

is next Wong Our Securities. Ken Guggenheim question from from

open. line Your is

Ken Wong

acquisition? to looks it’s previously some what from other Tock, is intended I to expand the they little you integration just incremental I a into reported were like learning about in sense verticals first initially maybe they dive was the where of kind had out for efforts? of then What are to on Anthony, it’s And Thank started are a on wanted Tock down my more $X.X Great. flush you question. my closed taking the that Tock Have little – into? we that for since QX. bit guess you we million, also

the any wondering were Just contribution is of tailwinds the kind Tock if headwind there possible you. fiscal XXXX. some what sense for and Thank in of maybe right for what

Anthony Casalena

of I it, April Xst, the mean, to essentially March the beginning XXst. closed part Tock So

very been It's the integrating. just some in And to because phases interesting we're so of COVID, new. early watch unwind, it's of right. from trends during of We're course, the year last very seeing

the to You profile to which the go, is then saw in. lot in-person on back own geography kind a and its for dining us go to you're in-person and moved margin depends of of has it moving

deal of a we away That Tock sort as of all seeing we're strong that. of said, at sort the up with so, we're goes around virus And as rate. to customers that pops adding and being move all

dynamics, between shift that of out play those yes, as over they kind we'll see two So purchasing time.

integrations based just Tock really the of presence some event in we haven't businesses, a phases – I this. transaction. early closing in the lot do – mean, our there. have really additional but on progress to really yet strong had wineries, early has made We're We we

over six want early, part take days. from next very the very months, to very, that think, financial you question? I see a early us. Marcela, to more so, you're of going Yes, do lot the And

Marcela Martin

that for Ken Thanks question. Sure.

seen growth double We high this quarter. digit as on for Tock well have

we we're very, the that to about I earlier, fits offerings excited well very acquisition, mentioned delight As our type customers of mean, within want portfolio and I these strategic which to. really our

the than would same leveraging be margins, it stage life company not time continue In to was as the that more from terms or of in was at the Squarespace. Tock say the And we – as of integrate. will the we the I businesses in we through a span expect

are pleased we have growth seen early mentioned, the this And quite well. with so in but as in far. stages integrations, Anthony of that in the really As we – business we exciting are very business

Ken Wong

it, Thank for Go Got answers. those you ahead. great.

Anthony Casalena

flex add many have areas other one deep. this only Yes, restaurants. where of reservation into to those thing the got hall restaurants wineries, some ordering we is It example really can best a of wanted Chicago of world's other It's up has different strong business. opens the is new paradigms. things. something events, an is, to It Tock

from think just I really of Tock beginning going So see business. to you're it's what

Ken Wong

Okay. helpful. if squeeze in could quick I it. super And follow-up. Super, maybe a Got

Anthony Casalena

Sure.

Ken Wong

bombarding XQ since that's right what now. inbox on my probably what's it's Just –

again. that That's investors a kind want about in that if components there should Thanks Is of of in for unique how maybe that it to understand think of outperformance terms XQ. think lot have uptake anything caused XQ there's seasonality me. aware be a just of some more some might of we I drove XQ sequential guide? that in to

Marcela Martin

for going of that has that. terms bit XXXX Ken. that Thanks, have before had you I strange now the the up the COVID. the forecasted quarters business year I'm mean, a in we little to going with been is the look back the seasonality. a very somewhat to how if in at we and we the Look, see in modeling follow way COVID have of been the behave for the we S-X, that how and financials have documents our you But that will filed we documents rest our that that's in have filed guidance year. seasonality

Ken Wong

Great, thank you.

Operator

is from Citigroup. Drew Foster question next from Our

Your is line open.

Drew Foster

Hi, taking questions. thanks for the

could in looks Why Tock underlying I'm the much the rate is It or sort going expansion? you take your rate of take the was is And So contribution quite Tock's strong the ultimately puts other Marcela. break from in down primary and rate a that Tock you in like assuming where of take quarter. quarter underlying driver there. business? rate is see expansion higher overtime? organic one First take Squarespace just takes your

Marcela Martin

of have – a I charge continue payment But GMV with white they mean, payment been hybrid agreements we of that for we that Like now to see fees. to further a fee revenue processing Tock mean, an a the that rate Squarespace, have mean, believe quarter I been we pleased Tock. we payments to a I to we revenue related that on solution continue it's seen has, fees is the – ways their Thank to with hybrid believe business stride others – even I explore like for yes, that where regards the approach. expand the take with the you model. through have we that, label excited than going mix, with has can share in the quite in payment mean, processors either industry more taken perhaps we this into Tock And the relates you have do to or that their And we have in of our a we agreements have and with we payment more that question. charges I nice continue with we processing. that higher share that and majority top how explore. have Tock third-parties. both area forward, internationally, And on help payment and fact I XX% that of and transactions. processing acquisition their customers and that continue the

Drew Foster

primarily lot, a then And you're pace, how we Marcela. just into and Anthony, few the the should about thinking over strategy you acquisitions moving couple how magnitude forward. about new Thanks think in a made wondering that of and verticals. years, And last any shifts

Anthony Casalena

Sure.

go and one good relate supportive that now XX good of new fantastic years, think mean, integrated hope a for that culture any hopefully think we last since the And a for couple least the people I acquired I many a around grown since rate is. of years been and proven from look team. I to and out the the proud was has that moved hadn't that they really They've is I has think – social that there mean that prior had the up their and founders. companies. really successful Unfold, am thing lot is is us, internal brought can in three which of it's Squarespace we been two us. releases – I Acuity I joined that's place which a their muscle relatively almost right about we've products I ways to years think for at we've I'm which, I with of product ago, powering I it and to and presence, Scheduling – [indiscernible] fully certainly the mean, there it have a journeys I thinking we other

happy something high with we've there definitely the that if we're – really a I'm before. out it's continue time. very to things new, top so those look there starting is and extremely Yes, all at again, quality look, very, we're than and seen going different scale looking So just to around unique

So I – strategy. any on that I have to don't more have a ton don't say

different Just versus question sort and I customers product maybe of the company. at will mention of we're It driven – build only would us transact. I a look sort always a that really design always that engineering, ways buy for be

is And scenarios hire in really own some leader. to there that of There's are at long traction theoretically, We of industry we that a a had had in or be ever to was it veteran build, unfold the XX the of achieved mean have what has like possible way be same simply compete remotely highlight I'll traction to expertise years, that time. but sort they're been in pretend there like deck. and I some so, we'd they level. no their they able that but have able sounded would have his my again, default I mean, I built to on Tock, either an doubt products could amount for the field just too,

are system. parts e-commerce we've forces build So scenarios And incredible to like, people. such where yes, joining product so like those yes, content other it's because done I'm to what proud we the of with our it product reasons touches ecosystem thought for that member then areas with of was be build the we could necessary just or management it the way where ourselves ourselves various there's

there. that's color of hopefully, bit So, little a

Drew Foster

Thanks of on quarter. to first the congrats that's you helpful. very both No, and

Anthony Casalena

you. Thank

Operator

Sterling Our next from question from Auty is JPMorgan.

Your open. line is

Sterling Auty

And guys. Hi, welcome the to Thanks. public Yes. markets.

curious since given characterize seasonal not happening that a here? perspective for I'm kind you would reason of definitely at September question But the how of from look around the started? quarter I seasonality you of that long doldrums, from it name, is coming why this Just unusual industry. what's space, the some has in time a summer you've how seen hits dynamics been VeriSign, in side, edition my of is And domain asked you've kind if the a out the gotten which this data

Anthony Casalena

mean without always mean, on I stay future, a QX. kind into I I say mean, of getting the focused I'll couple.

dynamics is and dynamic slight websites, bump I and other has bread entire of that slightly mean, of QX, domains, of the underlying is and think where now due which ways before. that had its they're right about businesses are of QX But scheduling kinds always the its really, is are certainly that now, then really business the the the businesses cycle yes, the they never seen a there Tock butter considering the is own are inside around in with peaking I up, really dynamics different, which existing kinds what's interesting usually interesting. course business are different dynamics macro we've environment. those seasonal then signing is which thing right not life are own transacting to there COVID, our of the business, shifts Squarespace that patterns, of in

of want we're still anything So, kind you now yes, add it's going I an together, quarterly right interesting what's on. proud see think quite results, look, to – things if of add? you'd Marcela, it mean, mean, the world I And, all you with them. I

Marcela Martin

very a business very are providing, strong year. the we excited And add XX% focus situation. between it situation I would about to with we which we somewhere for full And are I that, approximately I quarter. quite on believe we the in the – that will year puts, COVID we represent to full delivering But long-term. very are a we unstable guidance are and are the where the tend we would in think about XX% just overall the that Delta, plan. our confident And and economy's

that year I for the seasonality bit we consider before believe way remains entire mentioned see And the in an strong. our COVID. the considering is growth for And Sterling the a that earlier call, forecast thanks more have I the used we as still, of So question. to little

Sterling Auty

And how's or you the year the subscriptions the play stabilize context in sneak believe? this Maybe going see words, subscription growth if in you put other So comes XX% if I the the mix X.X we unique out The do kind up level? subscription from per million guide? revenue to I growth in can. one can it. of this follow-up, annual in unique should Got incremental could year-over-year, that that of

Marcela Martin

of or X.X% XXnd overall. subscription question, together And Look, the to ARPUS, revenue grown for an subscriptions at Yes. I quarter we average typically we on grown the have X% growth basis per subscriptions represents Thank with has Sterling. or look XX% this organic unique without unique unique Tock. year-over-year consecutive you tend ARPUS and mean,

international. domestically grow, have we continue that to think we opportunities plenty to So and of

we continue do We also online, year. the very last are fact see From about we excited than And to that cash that actually terms subscribers continue to value. more that capture better retention is and time of the to remind is tend stronger the with seasonality, that Bowl we that's branding, in most spend that have And the in the everyone, QX. Super to quarter the past seasonality, just ads. we particularly the

the growth offerings could way that of are our and with count it's we everyone, far that reminder in commerce. have that And nature a the seen include So the of because pleased we presence multiple single subscriptions. unique so quite to as a we and multiple offerings subscriptions, unique both count from

Sterling Auty

you. Thank Great.

Anthony Casalena

Hello.

Marcela Martin

the we operator. think lost I

Anthony Casalena

know don't to I get how with touch him. in

Marcela Martin

name think his it you a minute, is Give I Christian. there? Are Anthony.

Anthony Casalena

Yes, to it we'll contact him? he's give you way another a do have second. Hopefully Chris, to reconnect. able

Marcela Martin

are We trying.

Anthony Casalena

Okay.

Marcela Martin

is We we what it – is out all to figure for trying going that. I call. are what on? the really of – to on Apologies you apologize don't

Operator

for the apologize inconvenience. I

from Josey JMP comes Securities. Ron the of line question of next Our

open. Your is line

Ron Josey

Thanks Squarespace’s taking were follow-up glad question, Anthony, Anthony, commerce. the wanted working overall. about in and talking for here. on we everything's verticals Great. I just the six Marcela, core commerce

But a that getting XX%. goods, you content, we XX%. Marcela, expertise, XX call bigger are down understood And that – goods now from that x these selling part? was think time, months? said of about talk the would XX to just I you ways Does just physical on talked on helpful? your physical to was maybe Meaning, I be commerce more can how has all talk we're mixed sell it insights growth, it questions evolved you any Just mix of this Squarespace? last then is ability scheduling how this think seeing on

have some else but guys. anything extended you, this maybe on comps prior driven XQ, Thank questions that some getting you in were slightly detail? tougher is would or So maybe seasonality that this

Anthony Casalena

like are much of very areas is member we say I things very I'm sure the new. we how new, think can some that how right, to not much get breaking Marcela, the I mix? down very, get.

The And something point course, very, But of business right. been on of growing is a has request us something right mean, very rap on to more really future our remains that's but bet find COVID for the that's I so biggest now. important. a the versus for of well. on still we e-commerce sell the been a And huge has decade. the some strong, incredibly main effects, starting feature to the platform and now ability driver e-commerce

Marcela, soon. the like really, and And and always Yes. on add? from anything you'd it. to so Talking growing, synergies we'll focused new benefits we've get to there

Marcela Martin

per year, tough earlier growth. I there growth a definitely, XX% had, last on Well, growth of as are subscription, It's also, quite comps a mean, revenue are it's average right opportunities It's the pretty. X% organic add cash our GMV we operate, about we and we we we to year. that but would I – definitely excited that us with that which I compared are pretty growth retentions, we mentioned will organically. XX%, And see continued growing are room of – prior or also the where X% we be the with of than basis path better so quite an see ahead for large. in on adding growth all markets, good the

Ron Josey

you. Great, thank

Operator

of question of of line next from comes America. Bank Nat Schindler Our the

Your line open. is

Nat Schindler

and Anthony taking Yes. that. the and my you all markets welcome call thank for Marcela, and public

no will like Just dead not wait, about one don't radio, worry that airtime. the mind. It's

number? seasonality. something very trying looking blended in that belaboring what period. and trying said from know at to SaaS I to understand because the that understand about across is Really it's this the happened COVID not to And Marcela – and Sterling point probably model, is obviously, back revenue long earlier Going helpful with that and

And we comp it's Help I quarters last was and people figuring gone that I for year-over-year, of to a Is XX%. booking like you on? that mean, COVID bookings, to have last note, But height of there tough if out see I seems a year, at down going us don't because was really hard swarmed look believe did quarter XX%. So on what's on QX that to have fairly – me data. the during there? out have

Marcela Martin

there few booking. about things And for Yes, are year-over-year. grew a Thank Sure. actually XX% bookings that. you

when out comparable, because was it that, trying online a QX are is COVID XXXX get presence. to figure First in a business just was way of so tough we with to an the out starting, a the lot coming pandemic of were

there see than larger year-over-year, versus So you when XXXX. ads increase QX net you XXXX will at in is a look QX the that

Second make revenue, and [indiscernible] brand course, is acquisition the time of unwind the QX grade which with But I is of highest is reaching largest us use that, X% we actually dynamic to with this larger for a And regard And subscription investment. in revenue. the to XX% grown $XXX think where the a then month last, other has quarter, of of the if million. revenue at only mix. to currently is represents non-subscription XXXX, end that bookings is revenue, we non-subscription the as from X% represented added there shift the has have that non-subscription been talk year-over-year, playing

year. the expect of So annual revenue rate run strong that overall, will we for and do rest the bookings remain

Nat Schindler

trend as but going closer and to down line – moderates from down saw XX% revenue basically quarter should should this XX% to to and to it revenue out that we Or to come is XX% this Is bookings trend and for that thinking… Okay, your QX year? some the this bookings closer or to revenue is going going level stabilize the guidance I'm quarter?

Marcela Martin

going term, yes, non-subscription – to versus subscription because business. of revenue we see we the to closer come that we believe is like the shift them just that in long – in bookings Right, the in

Nat Schindler

you. thank Okay,

Anthony Casalena

is the one? that it Okay, Chris, last was

Operator

am turning Casalena. Anthony for call back Thank I now you all the your questions. over to Mr.

Anthony Casalena

depth employees the strong got great great We've profitability. looking you, and the Thank about much. Chris. all years Squarespace for we growth so very of combined to unique breadth and and to to Marcela long position. Thank Really the the sell in term, you the the again excited for forward our Thanks amazing great come. in questions. with you products with is really revenue interacting you quarter. Thank

Squarespace (SQSP) 10 Aug 212021 Q2 Earnings call transcript