ChannelAdvisor Corporation (NYSE: ECOM), a leading provider of cloud-based e-commerce solutions that enable retailers and manufacturers to increase global sales, today announced its financial results for the quarter ended September 30, 2013.
“We delivered a strong third quarter performance as our solutions gained momentum in the marketplace,” said Scot Wingo, Chief Executive Officer of ChannelAdvisor. “We believe investments we have been making in our sales and marketing organization are having a clear impact on our results. During the third quarter we added 152 net new core customers, increasing core customer count by 21% from a year ago. At the same time, we are sharing in our customers’ success with a 12% increase in trailing twelve month revenue per core customer as compared to a year ago.”
“Much as our strong channel partner network helps us attract new customers, our growing customer base is a strong motivator for channel partners to join our network,” added Wingo. “We recently added support for Best Buy, Tesco, Amazon China, Amazon Japan and MercadoLibre in Brazil, which we expect to drive stronger international adoption in the years ahead. With a market that is still in its early stages of growth and continued investments in sales and marketing, we believe we are solidly positioned to capitalize on the significant long-term opportunity ahead of us.”
Third Quarter 2013 Financial Results
Recent Business Highlights
- Total revenue of $16.6 million for the third quarter of 2013 increased 28 percent compared with revenue of $13.0 million in the third quarter of 2012.
- Core revenue increased by 30 percent to $16.2 million from $12.5 million in the third quarter of 2012. The company’s method for calculating this and other key operating metrics that it reports is included later in this press release.
- GAAP net loss was $(4.3) million compared with $(2.0) million in the third quarter of 2012. Basic and diluted net loss per share was $(0.20), based on 21.6 million weighted average shares outstanding, compared with a basic and diluted net loss per share of $(1.68), based on 1.2 million weighted average shares outstanding in the year-ago period.
- Non-GAAP net loss, which excludes the impact of non-cash stock-based compensation, was $(3.8) million compared with $(1.9) million for the third quarter of 2012. Non-GAAP net loss per share was $(0.18), based on 21.6 million weighted average shares outstanding, compared with $(0.13), based on 14.6 million weighted average shares outstanding, for the third quarter of 2012. Per share figures for the third quarter of 2012 assume that the company’s pre-IPO preferred stock was converted to common stock at the beginning of the quarter.
- Adjusted EBITDA was $(2.4) million in the third quarter compared with $(0.6) million for the third quarter of 2012.
- Cash at quarter end totaled $90.3 million, compared with $94.0 million at the end of the second quarter. The decrease was primarily due to expected investments in our long-term growth.
- Added 152 net core customers in the third quarter. Total core customer count was 2,287 at the end of the third quarter, an increase of 21 percent from 1,896 core customers at the end of the third quarter of 2012.
- Added new top-tier customers including Body Central, Claire's Accessories, Colony Brands, Inc., Elie Tahari, Godiva Chocolatier, Maxi-Muscle and Whirlpool.
- Average revenue per core customer, calculated on a trailing twelve-month basis, increased 12 percent to $30,113 at the end of the third quarter, compared with $26,987 at the end of the third quarter of 2012.
- Fixed subscription fees were 70 percent of total revenue and variable subscription fees were 30 percent of total revenue. This compares to 66 percent and 34 percent, respectively, in the third quarter of 2012.
- Subscription dollar retention rate exceeded 100 percent for the quarter, consistent with recent performance.
- Introduced the 2013 Autumn Release with several platform updates, new channels and geographies, enhanced mobile support and Actionable Retailer Insights, which offers relevant recommendations designed to help retailers bolster business.
- Participated in several marketing events across the US and Europe, including the Shop.org Annual Summit, Women’s Wear Daily Digital Forums in London and the US, Rakuten East Expo, E-Commerce Paris Conference, Sellers Conference for Online Entrepreneurs, Internet Retailing Conference, and Magento Live.
- Selected by Best Buy as a strategic partner to bring new vendors to Best Buy’s marketplace more quickly and improve the customer experience.
- Partnered with NetSuite to provide their customers with the ability to leverage ChannelAdvisor’s e-commerce solutions to automate omnichannel commerce for businesses spanning a wide range of industries to expand their sales channels.
Based on information available as of today, ChannelAdvisor is issuing the following guidance for the fourth quarter and full year of 2013: