Earnings call transcript Q1 2023

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Operator

Good day, and welcome to the Matterport Inc. Fiscal 2023 First Quarter Results Conference Call. Today, all participants will be in a listen-only mode. [Operator Instructions] Please note that today's event is being recorded.

I would now like to turn the conference over to Mike Knapp, VP of Investor Relations. sir. ahead go Please

Mike Knapp

at the XXXX. to to is the quarter released link market being quarter March This the welcome conference on results financial section website. can recording be call. webcast third available XX, ended year After the investors.matterport.com. closed and of Investor Matterport and Relations live call and release Matterport's website Company’s and a the is XXXX first results recorded for The found Thanks on today, the Matterport

Before and for business. I actual are and call cause including, results regarding forward-looking from expectations begin, federal the would results we statements you to like financial plans laws management’s that contains differ and meaning discussed the to that today’s but call. uncertainties on materially securities within today’s to, may numerous These risks future those remind not limited statements forward-looking statements subject to Matterport’s of

regarding the be Additional of of information uncertainties Matterport law. our this them, made to or except call by Any assumes the revise statements SEC. filings required as as day update and can are in found obligation forward-looking no the risks and with

on comparable the basis most which supplement measures references each the in today’s these will financial can addition, financial Reconciliation deck, as GAAP indicated. measures. to and a should earnings non-GAAP measure is measures available directly non-GAAP of a Company’s of call In not be on unless be be on to considered this financial a These otherwise GAAP as found substitute website. for

Matterport; and Chairman and Officer. Pittman, Executive J.D. are of Financial call Officer today’s R.J. Hosting Fay, Chief Chief

turn like to to R.J. with begin. I And over that, it would

R.J. Pittman

in joining I'm and that Good XXXX. thank to start off to you Thanks report everyone, a afternoon us great today. for we are pleased Mike.

we with revenue records range ago the management our double by our quarter metrics from of the spaces set across at the of and period. We new end managed up month. million above XXXX, and the X end More year million of $XX guidance the high million key crossed X.X of quarter. first start XX million, spaces than XX% under last The of milestone just the reaching spaces the number we

XXX,XXX base subscriber enterprise in growth strong to and expanded in quarter. improving buoyed medium adoption by Our rates and businesses small the subscriber

to continues to and marketing. ability building this use platform's strong and life customer and companies Our enabled productivity to their It cycles means growing our facilities twins as to cost to chip has and adoption. customers manage reduce to add new our documentation, list for better increase from us blue operations planning appraisal also to digital our drive management construction

continue organization. with Our to customers million, greater our range also and diversify are across record solution criticality of a revenue, their in as solution, the saving above our on accounts simplifying time The base. returns grow than collaboration our while over quarter. across of QX, customer serve seeing revenue the and had value $XX,XXX annual the $XX.X we enterprise hundred strong and propel recorded the helps of high end of verticals By guidance with we new recurring for subscription we our a end investment money them to

of line the customers. reconstruction solutions for engine. These as operating highly efficiency our scalable by guidance path Since better midpoint we investments its results continued Matterport driven profitability. business resulted outperformance to with strength $X.XX, our has accelerate built AI range beginning, focus bottom the Cortex, our The in $X.XX our XD technology and are our of foundation bolstered in continued around our strong loss than on that's net our on the in has share also per

automated. case, means driven our AI fully In

engine dimensionally like accurate, the We company currently an can generate AI Cortex. only digital from that are photorealistic twins

deep they The have fully become. twins digital efficient ago, we store. this network, kind, create, the more Matterport every a technology created automated And twins a day. and its in more sophisticated category decade than more we first breakthrough because neural only us lot a employ create enables and of thousands learning this of more the to digital we

These with already functionality XXXX, science do In business a revolutionizing in the in delivering today. have significant the begun inflection human-like reached the way industry AI the generative world's data introduction that turning captured a point marked AI intelligence that have and point has of new the technologies advancements we industry, attention. disruptive

of The This unlocks since none these here amounts has new beginning. possible. this the the true is data. AI be train Matterport been Without same of models, to would data vast for

Our around depends capture the of device, any digitized now world. depends spatial platform XX of has learn including pocket. put in data the To countries XXX over XD to physical enormous smartphone over on digital AI, digital square digital in this from amount our Matterport automatically perspective, space in and your train AI construct billion an feet on twin to precision twin how and

we our areas latest cornerstone of in the create future We have solution and the here and and every is limitless, power possibilities our every catapulting is Property exciting world. into synthesize of for that picture digital a enough complete are understanding world. in new the experience customers of to The our from day. our Matterport built is offering intelligence unlocks data built field deep twin the the

from software and enables extensive fully resolve help for new needed to a for remote We critical operating inspections manage to customers, them This multiple while location. significantly discover their platform any online buildings efficiency. properties range automated property manage challenges in spatial it wide insights the facilities easily single powerful of their library, And data them our operational larger and clients generates down our enabling from cutting analysis. time onsite

select and availability We're in of currently announce piloting XXXX. property general second intelligence with expect the customers half to

a are significant new to quarters be our will unlock AI-driven new and growth the of existing years for come. world. Matterport about excited the the around in for incredibly We This solutions customers potential and both

availability seamlessly a who of our for on makes visually buildings, growth milestones production fueling for pass industry general easier Amazon, to our financial as are digital connect our Last the the AWS, data I'll enterprise twin equipment, results with real key create that remainder turn and the accurate elaborate attention announced industrial to few of around the customers an of it And solution systems IoT integrations and provide outlook and will maker, globe. lines. world digital into Let's enabling This to we J.D. dimensionally year. month, immersive factories, new then such Matterport twins. discussion the developers twins to Fay,

We with XXXX effective solution building health AWS. to improve and by cost new and extremely new to our remotely partner alongside at Our environmental their Germany, operations, Messe at and our enhance an efficient increase production digital offering in optimize efforts safety showcase integrations supports excited customers outputs, enterprise transformation platform Hannover performance, were facility. in and providing equipment April

demonstrate customers. Messe Matterport from to benefits discuss focused technology. technologies, explore largest visitors and to It trade diverse exchange industrial more. and as in the and is solution the opportunities, well for the of software, AWS in development integrations areas Hannover like and event digitization, the venue The trends perfect announce was industrial exhibits on business our the industries our world's showcasing existing potential latest ideas, latest robotics, It cutting to as automation, technology. industrial together edge brings fair renowned is international innovations for a event and

to quarter, RFI stakeholders integrations Construction process solution a current it The using new construction the and detailed project During methods RFI and to collaborate critical vital the in simplify making visual architects of for This Autodesk information Cloud, RFI by is of between digital communication announced twins, easier workflows. immersive also contractors we teams from project allows traditional to context speed request Build. becomes process project, on new Autodesk management and within Autodesk the every Matterport the or project. the for state build with dialogue project moving of and

more Historically, has for the in to rework project United occurs RFIs the per for formats construction will RFIs, responsible making States. information. as than difficult the consuming, than been time in XXX and constantly Navigant evolve industry track construction the more Inaccurate stakeholders week. Construction averaging that that documentation spans it result to this is According documentation in teams survey, almost weigh Forum and the average multiple process of or incomplete typically submitted XX tedious latest half

dramatically documentation create The this Matterport Autodesk streamline record the This process speeds a Plus the within of errors creating along space. while up visual track replica project, digital and for simplifies to system of by directly users the and solution builds way. conditions, the allowing reducing requests site

additional to our add organizations blue-chip customers. We of growing roster for continue

of fact, we the Fortune X,XXX are call to companies XX% proud are customers. In

any been has is and the value organizations and across customers retail, of set growth, It of have strengthening costs testament recognize reliance solution our strong because reducing and travel and facilities proposition estate a an to market, Matterport that many diverse ability reduce and industries management, to their increase it our our construction real the around to critical benefits organization, hospitality, markets such set fortunate and of insurance driving all are single in innovation We to from our on productivity brand. across the revenue for globe. end a maintaining important our

space horizons with indoors on the to large like opens seeing camera. capture we its no you built has to both revolutionized update any condition, capture outdoors. can ability ProX success our tremendous in on an This physical product its size, provide kind, with and I'd limits for fastest and Next, type of and The stunning capture camera with new new detail. of the virtually location, spaces are XD world

in all in its customers We've unbeatable of hundred our from XX to And to and has positive The megapixel capture up expectations debut class to its lidar are and power performance reviews our field. customers, overwhelmingly continue to the that own. is price a sales They've package a sales top meters. creative market original Thanks since sensor put and received and feedback agree its range response ProX work last fall the collecting we our plan. their in ways. ProX exceeded

for the to year, Digital and property stunning the the solution offering less tour, a two most social Pro business introduced preview of in and innovative provides XD It floor a In QX to matter services. is this XD professionals Digital property Moving one Pro. days all within Great plan, video. second HD media, marketing $XXX. delivered we than all affordable port marketing in flagship on our with to one a for market photos, industry.

of changer a from one for and most this real environment, produced I aspect estate this compelling flat one convenience the the value offering offering Digital entire Pro is that in of In think game is one rate. photos challenging using twin large or digital is significant complete is the A from their number choosing of and package, same only new while for agents Digital the Pro an the agents customers lower to a portion sellers. often Pro initial price. are excellent, are of The response or Digital upgrading appointment

Matterport in surprise that no the that of year. excited arm Twins the all their here with price for Digital Agents, listing. than U.S. much the It's of of rate the getting doubled brokers Pro photography less XD real in XD power and listings estate VHT attach sellers Matterport Studios, has tour last the marketing acquired or and we packages about great are the same more, traditional Digital for

Matterport are Digital property world. the catalyst accelerate and will the listings confident eventually share U.S. around in We the be of that total Pro to

full to like the first year quarter discuss QX J.D. our would to the outlook for over for financial the now XXXX. I and performance and to turn it

J.D. Fay

quarter. million $XX the period, million product $XX.X and revenue Thank The Subscription well our categories guidance quarter, from revenue a up total which ago XX% rose range. quarter, you, from across and up with period, subscription in above delivered high and was strength in services to our We year revenue our end was guidance revenue subscription year range. ago XX% the above R.J. in the first for the in new achieving the the of record

grew In addition, our recurring million. annual $XX.X to revenue

grew the to we by Of subscribers the and paid compared and XX% grew what had growth of quarter free XX,XXX our the from have end cohorts quarters. free XXX,XXX for seen X% subscribers by several were higher paid past sequentially. the at those rates Positively Both XXX,XXX last subscribers subscribers. first in subscribers we quarter,

as QX us. net increase in spend their continue with Our dollar was to expansion rate XXX% subscribers

Approximately small strong This our more was from customers non-real expansion the and customers. prior unchanged comes enterprise as spending. remain retention their subscription growing on and from remains of revenue cautious XX% quarter estate

from and increased by period, market end estate real strong eclipsed our from revenue digit ago While this was and year retail, in insurance travel double growth facilities the construction, hospitality. and growth management

driven more capture accounts year growth our than by in twins ago was for $X.X services to digital million the customer. embrace revenue services two period Customers double we first capture perform Services and onboarding from the where offerings. the in of the for quarter all of continue subscription

strong saw offering earlier. that new pro on the also our We digital launch described of demand R.J.

Our demand for in up quarter from product revenue was robust ago by million ProX first period. XX% continued camera. the primarily was This the our $X.X year driven new

to from higher services gross margin, gross to XX% attributable in quarter, total product first margins margins. quarter prior up significantly and XX%, for on Moving to the non-GAAP enhanced margin our improved the

subscription the Our gross features to XX% margin roughly platform. quarter from quarter was ago quarter year periods. into and prior gross XXX release points new from the basis as flat Subscription XXX to can we margin vary subscription the

that And us negative to challenged last to XX% ProX we first year positive with the us. strong XX% the with reception the roughly balance chain, consistent We that the for and quarter expect will mid several made of margin excellent prior Product with quarter behind XXXX. improved for as gross expect camera, gross quarter the quarters. in first to the believe margin XXs in be over compared our margin the we issues a market are in that supply progress our next we subscription product gross be

our ago total from by revenue The spend prior we efficiency was X% year research expenses, platform customers. primarily though year quarter. operate down related operating X% were the year continue for ago and it for in period. $XX.X in QX lower our innovation slowly sales grew much as to expenses year reduction period, data spend to XX% than over reflects to Turning up continue the greater more we and growth the in though our technology R&D and was development operations. as This million, SG&A from efficiently to commitment $XX.X spend growth in insights to drive our million marketing more from drive

per This of is The $X.XX, result million our $XX.X first loss. loss midpoint a share non-GAAP to $X.XX is a above and $X.XX quarter net of non-GAAP the range loss guidance $X.XX of to also quarter. the the progress bottom the significant a very are bottom line driving line as Company XX% achieve improvement actively from in prior on pleased profitability. we the with I'm performance

share count million average XXX shares. weighted Our was

Moving free. cash on sheet, remain to the in the investments, ended quarter with $XXX we balance debt and we million and

are XXXX ago to more guidance business continue improved from have our the funded raising our introducing we than more and to our guidance. free by fully than cash We plan. Today, achieve XX% and for quarter flow are full year period, financial believe we year financial the second

quarter, $XX to in be we range of revenue $XX.X XXXX. to for revenue of million $XX.X on outlook deliver be We for focus Accordingly, adoption, the the our in second million profitability on has to improve grow top and expect to $XX the and in subscription record range year for improving total we resulted strong remain to continued line and efficiency million. customer as track the another the metrics, an Company operating million

between split services lines. be and revenue balance expect revenue roughly to We the evenly the product of

We to million total revenue be quarter per range expect be loss anticipate the $XX.X full million $XX.X $XXX of revenue subscription the range range with share be to year second year in the in $X.XX. $X.XX We $XXX of of to non-GAAP million. to in to to expected XXXX million full XXXX now

XXXX. $X.XX loss midpoint $X.XX a share. of from we to to expect represents represents XX% we per compared an articulated improvement This and XXXX, a quarter of year the guidance full the For $X.XX last the non-GAAP improvement at

actions actions becoming of the measurable And financial expenses to We performance. half latter annualized million including in last path in in profitability, year. are have taken $XX visible our now and operating accelerate to out these our specific taking

continue We the while their real ever on plan same insights to AI-driven reduce path centered customers time by the solutions our profitability revenue world. increase helping grow to will execute twins of at pursue costs digital and valuable data Matterport more our to around and with productivity

like call over would I to Now back turn R.J. to the

R.J. Pittman

J.D. growing and the our our markets, demonstrate challenges those Thanks estate record in built environment, facing difficult for our and results demand commercial digital residential macro the property the solutions platform. especially twin and innovative headwinds real around QX current the Despite

in helping moving while offering and alike delivering to diversified businesses enterprise is their Our savings, XXXX and cost brokers, forward, customers platform improvements. essential the managers, property keep productivity Fortune operating agents, critical efficiencies,

tasks immediate Twin are Digital inefficient transformation no has the associated and an day. Solutions ROI most subscriber data automating of it's digital for costly digital of spatial businesses the The and Matterports full the every built XD largest managing twins on driver location. some and can the built in essential and with world library swing, delivers growing base buildings the productivity spaces and Matterport world's that world, longer ignore. largest of is Matterport by

digital Powered by for era platform dawn AI technology We're scaling science Cortex central rapidly every building come. to and continue a to role generate built in data AI, years a on new will in new deliver for for the planet. to is to readily our play Matterport the twin world and solutions harnessing a breakthrough at of the

We stratification category next we industry world. continue of the to more created lead the than built ago will through the a lead the boldly decade of and digitization decade and

you joining Operator, are questions. we ready for us Thank for now today.

Operator

question-and-answer [Operator Markets. We comes Today's Yun the question Instructions] first Capital will Kim begin from session. with now Loop

Yun Kim

the congrats want behind solid is launched to available seems the which sure worldwide us. just regions supply you now when certain to and is ProX not largely today, it. on chain to in First Good stabilizing, another news. good that R.J. just I J.D., be quarter always now are is all first make metrics hear

R.J. Pittman

it's is things. world ProX two there, rolling driven response and around Thanks by out Yun and quick the

be a for to just by be we've but markets truly not related gated ProX, and and that's country, that to ProX, we certifications. could every few WiFi or in in the the unrelated served it's the the steps for it power country And but components will camera. that worldwide process supply more in be the delivering So, chain, in could

in And and are product we'll more us to are local so in inhibiting no our of get blockers make government, there but now, out and chain from available the certifications we from supply that Europe as Asia, as -- the countries. the continue cameras more getting into

Yun Kim

give guess you know you. strategy. Okay, of us the on Thank How part quarters, but much update I in front. we a then, -- And I overall can an that's a key haven't great. your couple asked partner ecosystem if enterprise

Just if you partner see the traction of is to? us on give your business can by partners How and update towards mix that some maybe. where do driven much today trending you

R.J. Pittman

a And true huge Partners Redfin, they Sure. can real the of of have partners in name few, reach Zillow, that’s sale with to the home distribution role Matterport value right? that top play tremendous bring estate provide as and take channel estate, ecosystem. if step like Keller to And these realtor.com, residential listings, across a organizations half on you industry. are Compass huge value huge what real great well just CoStar, back, et for Matterport in at rent, and a And cetera. and residential Williams, Realty, add success really homes that massive

with category Hanover, and And Amazon That's the went to we industrial better our the speed. a the and real are IOT day, same successful. story the and commercial digital in on a relationship and at to the twin partnership general bring estate, I call event was the full AWS, flourishing enterprise with and things that already hugely tell maker when the is twins Amazon discussed twins you global announcements availability we AWS. Germany In and can from by it's couple of there manufacturing and the getting digital

data manufacturing around has scale and to we especially incorporate the our them opened customers into that it new pipeline combination companies of And of right and a quickly and twin visual doors align the has enterprises seamlessly provide that large interest lines world from where with inside this very real the digital visually can It's quite Matterport time levels. turn We'll pushed really context a performance and dashboard way. factory and seen that really with factories floors. put never to and in production category the before and extraordinary up

and our have and like the that Most with a partnerships of in projects architecture, of similar integrations those live same Autodesk, we in is a start influencer and type stage and the kinds perhaps AWS category and companies Autodesk lifecycle design The around operating fantastic construction of in design than major large. bellwether with are construction. with the or true integration and to world same can small and move it's the to facilities Twin phase building new obviously deliver building building the the in at which value upstream for earlier U.S. Maker,

So, but these and continuing channel a partner are to provides and I think the U.S. and in verticals just the access not that the because strategy, industries invest picture world around gives here it also continuing to into. great you we to we're scale in that

Yun Kim

to have just quick being a have added value up you just like Good introduced, you sounds made. follow It Hey, intelligence. like of products property comments on lot good I a hear. that the

just for and of storage beyond I'm subscription those curious components how enterprise the You your not of services simply just your business? AWS and is driven scan Twin introduced just Maker. business products by type much

R.J. Pittman

Sure.

come intelligence to also that data as say commercial and that add-ons, stay in and Twin provide, well of the our real AI all Digital for with and and in our a enterprise. property services mentioned estate like the As value markets. RRE analytics bringing especially we engine as can as all from whole, added insights we're we've to the vertical But as

and of absolutely enterprise customers. they're of the core of our for important is would the for really camera, the introduced I what is the puzzle Because Matterport two for new of data insights management efficiency information those for that these predictive and providing power middle and property that when predictive Digital since And analysis we were generation pieces maintenance, provide are that Twin of tell performance you last also ProX that to year, the the operating of looking we next predictive larger go of from solution introduced time a forms against to analyzing able the of what and beyond collect operations. its real data, about and and we to in spatial building all from come and all insights everything that

to the that's some most the probably for vertical exciting of both in also, our the solutions across markets technologies, and area continue each going for end with these advancements data us. in board science that's So of but

So, there. driven quarters, good I've about provide talked of add-ons this this the on kinds data that that asked a quite question can these business twin. you is be bit the real going over opportunity digital of several the top insights in we last by growth and future that to

Operator

The Bhavin next Deutsche Please with question comes proceed. Bank. from Shah

Unidentified Analyst

It's comments and for starting any aware Thanks be Bhavin the acceleration accelerate about back from see that half what it this Nick questions. talk the should guidance, of? with other my looks subscription the taking you just on revenue half. J.D. linearity growth around Can driving evening. for like you we first

J.D. Fay

There's bit an that acceleration of a little We the past actually years. see over several there.

prior for overall, consistent will this trends that we be So our year with see years.

been enterprise integrations some particularly addition, customers cohort here us, with including as growing spend growth just around seeing with in the their chatting of In today, as we've adopting with customers well new R.J. discussing. as was existing our about strong we're

over year time help continue So those and accumulate then year. the to and can sequentially subscription over drive growth

bit rate a guidance forward QX. to then, from for provided is in going guidance growth a increase hit basis quarter largely the And QX what So little steady full today. on there's implied by we're a we quarter year the of looking

Unidentified Analyst

raise, that with the year for spending about of rest year? balancing margins you This think, right, pace remembering for of I think the sort should says rest seeing a follow-up. as of just the the we gross EPS After of investments how I'm the flattish and if said, the

J.D. Fay

that's focusing and terms growth, investments very that make make that highly ROIs, Yes, operating on we efficient, and sure to expense of they're they down strong have course we closely to in And our are progress right. where making the path continue profitability. we of

and in got be QX. that trickling this From up of lines. we largely saw to consistent with slightly roughly couple bit so, see QX back are a flat in in of down mid-flight would targeted the little we perspective well. expenses quarterly our as that perhaps a course expenses And from with includes investments operating what I a in performing the And year, we've reported rest operating QX, the of then, again, what

the front, margin front in for in margins On margin roughly that our reported with gross is agree total QX. well we I as gross consistent what outlook

So, largely this year. out through of trends rest the steady

Unidentified Analyst

future? on figure look talking I within one enterprise like in in R.J. you So should the for grow? think ARR then And where customers hundred more a to expansion that back was think the existing the from overXX,XXX that the in customers, eventually could you do it future about what ARR. expect we

R.J. Pittman

a follows trend. It Sure.

back few things with when we back the market and maybe enterprise a real a enterprise entered years you occurred. Two quarters several If look to solution.

or then operations gone the XX, got digitizing even and those facilities where one, two, course One line XXX, and the three size going we locations to enterprise from we've the all those factories production retail large locations growing companies or customer thousands spaces XX, of Then of way to that for have And number been larger. of our of some the up the of customers. of retail was base. also that size and

that those you all build fact It asked. expansion In that, previous was is a are greater the services, list drive is the market. metrics invested make all solutions, working enterprise key big that really one create this control a capability is of that. the XXXX push all And for at operational both costs about and your in and much and of year hardware, mark. value able us. I the enterprise, us and both to year is that to our this that of well part investment. I'll big significantly All last than are just the customers the investment about up commitment that because And are and a we we're keep well great in hard. some how and proposition that's in will you and past efficiency we're and software, that the to bay a higher And even rolling of in of bringing out of have question number tell comment past we six really the figures those year, XX,XXX been XX,XXX that continue average there that platform for into

to build enterprises that of predicated importance those world. running facilities and around more of we've many complex, feel like got that security. that collaboration, class security, to continuing serve enterprise a And we that's are a on capabilities is way these more and us kind the enterprise particular locations the up capabilities distributed larger, And offering in control, add-on if call grade it now this platinum government can includes to to all fantastic solution access required. taking I enterprise that value Really

Operator

Porter Our Morgan Stanley. next from Elizabeth question Please with comes proceed.

Sophie Lee

at product from This the for and this seems raise if you question from know, growth. guide quarter is on yours services, and beat coming was It Sophie quick product for came had the Lee you services. also, and software Elizabeth. on look I 'XX, the a FY

if announcement of isn't some Construction significant any AWS guidance? as Cloud, revenue, the revenue how And revenue, integration software and the that So, the wondering, into why as growing growth to segments. software you I'm wondering Autodesk of is, the factored the about especially if think other this of I'm is subscription the fast and with

J.D. Fay

top actuals, Sophie. $XX.X our in guidance first gave quarter subscription of that does our million QX for Well our we last range that thanks Yes, item. revenue

acceleration there. actually as the sequential about well. revenue rate and good growth really The growth feel So increased subscription

expectations issued. than our our just we're revenue QX than guidance performing on for better the results so we that better and subscription And

higher full out I further Now of subscription past we growth then that it of forward what from implied periods. growth to year, in you think in period. is there the And kind the a revenue, some should if acceleration as quarters model that were sequential enterprise implies QX see we've seen subscription go than to good you'll to growth guidance our with customers QX sequential with kind and carry have the trends, also strong our through, in exited of

in So revenue. feel rates subscription really and good about the the growth improvements

revenue, some that It's given into is the coming term enterprises we proportion the its longer from on and contracts. have given already into modeled good recurring visibility nature guidance increasing subscription

as actually the of strong of noted, in line in line. I you services outperformance part the along So some and product growth the course think that's with,

side in efficiency with enterprise of exciting Autodesk discussions the the On such in is partner getting strong stages all partners large respect customers. partner of the with Maker, spoken to help and construction deals But and AWS, as companies concluded. with integration, partnership the we're are some pipeline together workflow It's solve customers Twin cloud very very the these quite those working the about their to we've and early needs. today,

growth. also of in or transactions, expect So concluding will even I of our more in those time, including, that recent subscriber to over progress we see you which in releases some that create tailwind those that know, a we'll press addition described further some

Sophie Lee

there. My mentioned some color so Thanks SMB quarter. it. much seeing into the continue second is for question Got weakness the you

So I'm residential any any segment in SMB should for from throughout year? on in wondering recovery and the of weaknesses kind full estate. incremental And commentary you if what of And especially thinking is year? in we about be provide also real the us terms factoring NRR also can are the this or as progress there you diversification,

J.D. Fay

questions, for Yes, those Sophie. yes. Thanks

first first revenue. in last real estate So of the in subscription and XX% real perhaps estate question general our that's residential about

over terms continues remember about percentage the thirds So world two property it's around or to industry moderating estate. the that of in in mark. the we've you of real we've -- in dollar real said And terms may residential XX% to that noted year year of grow while that that revenue, total absolute

proportion So, are expect of verticals, business. the our have the it's of real a which we'd healthy up to, other residential to growing course, industry always quite coming moderating estate in make around XX%. are of then And course, XX%. up other strongly But

their space. the that SMB that SMB been steady the which of medium couple the small true moderated, change talked it the about last quarters. With has would is I But have so trends of expansion no in in the we've quarters, sequentially trends say over respect or to last and over couple businesses,

subscriber of uptick we've editions, growth subscriber seen in an actually terms and In growth. net SMB

paid free reported And we in and some of can our be subscriber seen that that numbers today.

faster in And new and so including at s encouraging subscribers cohort. we're rate, garnering the that's a v that quite

As residential looking customers better efficiency productivity achieve and are in estate, real verticals, in to all including in ways for operations. their

that And in usage brokers very agent's estate all launch in then service, States, to and particularly perhaps then the a and effective the United package the generally of industry, that's response customers helping needs. more out interest comprehensively. providing launch more focused seen very quick onto space, Pro Digital Digital start service. digital drive finally, our but as it also, successful more estate marketing with We've with the Pro meet in but of the to cost promotion Matterport which And actually real subscribers first a and on, across offering, residential a agents from with come is Matterport an real more is platform

in indications year and early is as So, fiscal receptiveness for we have a actually lot SMB the this are numbers grown. going positive that space the have subscriber some on the there

In net seen that expansion of strong overall in enterprise our with NDR year, I'd the and stays of with terms that expect dollar couple continues that a for for we've quarters. what roughly SMB very over last performance consistent outlook metric the or

Operator

proceed. Luke [Operator Instructions] comes Mott The question next Wolfe Research. from with Please

Luke Mott

improved of puts results. Hi, about to Congrats some for led the product you margin? have Can Josh. this the talk gross on takes is the Luke and which on

J.D. Fay

was margin. comes our helped margin thought That and camera. product average value camera that the One features new driven improve or great with ProX Yes. That's provides. sales matches, a growth is, gross the by additional price that gross largely two the selling higher first in is The it approved element things. higher stronger

secondly, then, about all purchasing materials the last those prior, that conference prior of in of into were ProX the those are constraints to we And higher we year. as through process come, supply the of behind us, costed we have impacts went the started remnants camera selling that talked calls. in that put the chain And we

chain constraint also helps that costed the inside that able now happens, increase ProX is through issue those margin. higher So us, that that behind materials it And product to of them. have sell cameras we're as supply

the trends So the continued Pro robust through us remain of year the demand for with supply should chain three. steady expected overall, those and constraints rest behind the

Luke Mott

quarter? few Great. quantify help been the Thank the you so much. up, could How's acquisition. And a just you follow quick contribution there quarters business to any us Studio's doing? VHT way to since And is that the it's a

R.J. Pittman

it I'll and about quarterly take of talk part you the J.D. can first contribution.

for And of otherwise. of do, and and built First, so to lines day always we're estate operationally, have key of our guys really, will There residential be. cover, more bad and to a ground business now really VHT part much excited on fully future. real part acquisition important the and much the so these very every important, And real both significant I to it organizationally, was right? the company, an residential world such because is is cohort largest more part of estate is integrated front are good, Matterport, our one of we're this a Matterport also and

market is cetera, volume rates, bearing environment, and challenges estate real is, are headwinds really residential and activity et due on world. pretty predominantly, And macro real reality the also tough U.S. the in the interest across the estate but the listing facing inflation, to we down some around

was talk never incredibly market. something quickly that Digital because the is And teams Pro, market we're both this to before. offered our to what been heard it's had game a this us first And we a about the we on, think project bring the worked you eyes post-merger lot so, and to that's and offering changer,

people floor or the far twin, the not a same The lower and merger, offering, XD today. competitive, if this photos the the opportunity in pay very, And to these get for traditional two listing the the it's coming and core get for -- just Matterport walkthroughs, at the transformational it's go digital digital of you together. companies video photos plans, what beyond price than of very spirit

it just early quarter. rolling we And so started days, at is this

awareness do to brand some We put real lot of behind have a to work market it. and

a have for a comes all be bringing to real this markets the it's make those out huge REIT it is auto more it market we been and the important feeling though But brought how are grow, and and in tough And to breakthrough cost product to superpower have when maybe regions even share And it couldn't some brokers a we're headwinds. and in particularly facing strapped think marketing when success. we in and headway here, going a we're where this some estate be to that constrained online. efficiency business capability realtors, agents even economy to

for really Digital come partnerships a few going full So, thing the Pro quarters expectations future. swing, in of a it's the a launch off for lot take we're to but It's the pad to get and and this about business customer our any you little good do impact? it's really talk we near importantly term by want begin feeling the to early RRE. our and how the J.D., other bit and a received and about progress most

J.D. Fay

don't talked about percentage statement our as some Sure. was up well great markets presence see, of further sequentially, double in to up business well and as points, while strong was line very key to reasons income the share market has out the expand time. going it we more that and into R.J. we break discussed services that the verticals its markets In we're it business of a is, reputation VHT as sequentially rolls terms more digit has VHT's the in that for to in United as bringing in over And as which States.

well so a growth up bring news. So, percent, double by that hundred revenue services good total percentage performance digit in sequentially, all over around helps great year-over-year

Luke Mott

Thank you so Great. much.

Operator

to are At Knapp turn this Mike showing to the any like in now this over no closing conclude queue questioners and remarks. time would does question session. I back further answer for the and our conference we

Mike Knapp

Great. Thanks everyone for joining us today.

look on Matterport As earnings speaking appreciate with call. your interest forward you and always, our we in next we to

Thanks and goodbye.

Operator

attending now today's conference you Thank presentation you concluded. and is now for disconnect. The may

Matterport (MTTR) 9 May 232023 Q1 Earnings call transcript