Smartsheet's ARR Surges to $1.056 Billion

Smartsheet Inc. has recently released its 10-Q report, providing a detailed look into its financial performance and operations. Smartsheet is an enterprise platform that offers a range of tools and solutions to facilitate work management for teams and organizations across various sectors, including aerospace, automotive, biotechnology, finance, healthcare, and technology. The company generates revenue primarily from the sale of subscriptions to its cloud-based platform, offering different subscription levels and additional capabilities for enterprise customers.

In the 10-Q report, Smartsheet disclosed its key business metrics, revealing that its annualized recurring revenue (ARR) reached $1.056 billion as of April 30, 2024, compared to $886 million in the previous year. The company also reported an average ARR per domain-based customer of $9,906, indicating an increase from $8,520 in the prior year. Additionally, Smartsheet noted a dollar-based net retention rate for all customers of 114% for the trailing 12 months, showing a slight decrease from 123% in the previous period.

The report also delved into the company's financial results for the three months ended April 30, 2024. Smartsheet reported total revenue of $262.98 million, representing a 20% increase compared to the same period in the previous year. The subscription revenue contributed significantly to the growth, increasing by 21% to $249.1 million. However, professional services revenue remained relatively stable at $13.89 million.

Furthermore, the 10-Q report detailed the cost of revenue, gross profit, and gross margin. The cost of subscription revenue increased by 8% to $35.77 million, primarily driven by higher hosting fees and amortization of capitalized software. Despite the increase in costs, Smartsheet managed to improve its gross margin for subscription revenue to 86% in the current period, compared to 84% in the previous year.

The report also disclosed the company's operating expenses, including research and development, sales and marketing, and general and administrative costs, which collectively amounted to $225.79 million. These expenses contributed to a loss from operations of $11.13 million for the three months ended April 30, 2024, an improvement from the loss of $32.12 million in the same period last year.

As a result of these announcements, the company's shares have moved 17.2% on the market, and are now trading at a price of $44.27. If you want to know more, read the company's complete 10-Q report here.

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