AvidXchange Holdings, Inc. has recently released its 10-Q report, providing insight into its financial performance and operations. AvidXchange provides accounts payable (AP) automation software and payment solutions for middle market businesses and their suppliers in North America. The company offers AP automation software, a SaaS-based solution that automates and digitizes capture, review, approval, and payment of invoices for buyers. It also provides the AvidPay network that connects two-sided payments with buyers and suppliers, and the AvidXchange Supplier Hub, which offers supplier insights to cash flow, tools for in-network invoices and payments, and early payment features. AvidXchange serves various sectors including real estate, community association management, construction, financial services, healthcare facilities, social services, education, hospitality, and media through direct salesforces, strategic channel partnerships, and software and technology business partners. The company was incorporated in 2000 and is headquartered in Charlotte, North Carolina.
In its 10-Q report, AvidXchange's management discussed the impact of macroeconomic events on its business during the first six months of 2024. The company noted the continuing impact of several macroeconomic events, including a higher interest rate environment, sustained inflationary pressure in many sectors, shifting economic sentiments, and indecision evidenced by lingering negative consumer sentiment and the upcoming election cycle. AvidXchange highlighted that these events have affected its business and its customers, leading to moderation in expenditures and purchasing decisions, particularly discretionary spending, impacting the number of transactions processed across its network. The company also noted that the macroeconomic environment and the upcoming election cycle have influenced certain suppliers to select lower-cost forms of payment on its network, negatively impacting its payment type mix and transaction yield.
AvidXchange provided a breakdown of its revenues for the three and six months ended June 30, 2024, compared to the same periods in 2023. The company reported total revenues of $105,132 thousand for the three months ended June 30, 2024, compared to $91,154 thousand for the same period in 2023. For the six months ended June 30, 2024, total revenues were $210,730 thousand, compared to $177,976 thousand for the same period in 2023. The company's revenues are recurring in nature and are derived from multiple sources, predominantly through software revenue from its buyers and revenue from payments made to their suppliers. The breakdown of revenues included software revenue of $29,914 thousand for the three months ended June 30, 2024, and $59,602 thousand for the six months ended June 30, 2024. Payment revenue amounted to $74,183 thousand for the three months ended June 30, 2024, and $149,385 thousand for the six months ended June 30, 2024.
AvidXchange also highlighted key financial and business metrics, including transactions processed, transaction yield, and total payment volume. The company reported an increase in transactions processed, totaling 19,730,167 for the three months ended June 30, 2024, compared to 18,819,619 for the same period in 2023. Transaction yield also saw a positive change, reaching $5.33 for the three months ended June 30, 2024, compared to $4.84 for the same period in 2023. Additionally, the total payment volume increased to $20,617 million for the three months ended June 30, 2024, compared to $18,675 million for the same period in 2023.
AvidXchange's 10-Q report also delved into its revenue sources, including software revenue, payment revenue, and services revenue. The company generates software revenue primarily through fees calculated based on the number of invoices and payment transactions processed and recurring maintenance and SaaS fees. Payment revenue is derived from the payments its buyers make to their suppliers and includes electronic payment solutions, fees charged to suppliers from its invoice payment accelerator product, and interest on funds held for buyers pending disbursement. Services revenue includes fees charged to process buyer change in service requests.
Following these announcements, the company's shares moved -5.5%, and are now trading at a price of $7.8. For the full picture, make sure to review AvidXchange's 10-Q report.
