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Pexip’s subscription base measured in Annual Recurring Revenue (ARR) reached USD
92.7 million in Q2 2021, up from USD 65.8 million in Q2 2020, representing an
increase of 41%. Pexip demonstrated solid year-on-year growth despite delays in
sales as a result of continued uncertainty around office openings. The growth
was driven by several key contracts including:
· NVIDIA, a Fortune 500 company and the largest Graphics Processing Unit (GPU)
manufacturer in the world, to enable connectivity between their video
conferencing equipment and Microsoft Teams as well as replacing their existing
call-control entirely;
· A Global Retail Firm, with more than 2 billion website visitors year, for
Pexip’s Self-hosted software to enable remote advisory calls between the company
and their customers;
· A Global Consulting Group, one of the largest in the world with more than
22,000 employees in 90 cities across the globe, to solve the challenge of
coherent collaboration between locations with Pexip as-a-Service Enterprise Room
Connector for Microsoft Teams;
· A Global Oil & Gas Exploration and Production company, a Fortune 500 company
with more than 87,000 employees, for Pexip’s Self-hosted software, to ensure
secure and reliable communication in a business environment with a high degree
of confidentiality of information;
· Public Sector Organizations such as the UK Foreign, Commonwealth &
Development Office for Pexip as-a-Service, The Swedish Government Offices
(Regeringskansliet), a US civilian department, and a US military department for
Pexip self-hosted Software, among others.
At the same time, the percent of retained revenue from existing customers, was
101% year -on-year, including churn of 10% year-on-year.
“Organizations all over the world are preparing for post-pandemic hybrid
working, and our salesforce and partners are working closely with customers to
get ready for the new normal. Uncertainty around office openings resulted in
somewhat delayed sales opportunities and bookings in Q2 2021 as customers
postpone their purchase decisions. The underlying momentum in the market remains
firm. We see significant demand and a strong sales pipeline for the second half
of 2021. Our continued increase capacity within sales will also be a positive
driver for growth in the quarters to come, together with a continuous launch of
new product features. In Q2, we saw solid year-on-year growth, with especially
strong sales to public sector organizations as well as first phase deals with
some of the largest companies in the world within key verticals, including
business to consumer (B2C) retail and business consultancy providers. These are
examples of customer segments seeking high degree of robustness, service
quality, security and ease of use, which are at the core of Pexip’s unique
offering. All in all, we are progressing well on our growth strategy as
communicated at the time of the IPO, including ramp-up of sales and technology
staff and our work with strategic partners, and we are on track to reach our ARR
target of USD 300 million by 2024”, said Pexip CEO, Odd Sverre Østlie.
Technology and Product Innovations
During Q2 Pexip made important advances when it comes to technology and products
that support the continued move to hybrid working, providing data-driven
insights, and flexibility in terms of location and devices used by customers.
The launch of the Pexip Control Center provided organizations with the usage and
performance overview they need, empowering both customers’ IT admins as well as
Pexip channel partners, who often help manage customer deployments, with
actionable insights and visibility into video meeting usage statistics, helping
organizations in their strategic planning of resources and investments.
In the drive to create flexibility and interconnectivity for users across the
globe, whether working at home or in the office, Pexip announced in Q2 that
Avaya videoconferencing systems can now register to the Pexip Service. This
enables Avaya customers to use their video hardware to place and receive point
-to-point calls with other video systems internally and externally, as well as
join meetings from providers such as Pexip, Cisco, Microsoft, Google, Zoom and
BlueJeans, without the need to deploy additional videoconferencing
infrastructure. Avaya is an American multi-national technology company and has
large deployments of videoconferencing systems especially in North America and
Central and Southern Europe.
With a diverse set of Application Programming Interfaces (APIs), Pexip can be
customized to fit customers’ unique needs in, for example, healthcare,
government, and financial services. Specifically in the field of healthcare,
Pexip cemented its commitment to delivering Pexip as a platform by launching
Pexip Health in January 2021. Pexip’s commitment to healthcare was recognized in
Q2 through the “Best Telehealth Platform” award in the annual MedTech
Breakthrough Awards conducted by MedTech Breakthrough, an independent market
intelligence organization that recognizes the top companies, technologies and
products in the global health and medical technology market.
Q2 2021 Financial Highlights
Revenue in Q2 was NOK 177.1 million, up 8.5% from NOK 163.1 million in Q2 2020,
driven by higher revenues from Pexip as-a-Service to new customers.
Cost of sale in Q2 was NOK 20.9 million, reflecting a gross margin of 88%, up
from NOK 10.1 million in Q2 2020 due to higher hosting and network cost related
to higher usage of Pexip as-a-Service, as well as a shift towards cloud compute
from investing in own hardware.
Salary and personnel expenses amounted to NOK 148.6 million in the quarter (84%
of revenue), up from NOK 79.8 million (49% of revenue). The increase is mainly
due to high growth in employees over the last twelve months, in line with
Pexip’s growth strategy.
Reported EBITDA in Q2 was negative NOK 40.6 million, reflecting a negative 23%
margin, down from NOK 5.9 million in Q2 2020. The development in the EBITDA
margin is as expected, as the company invests into growth initiatives where the
expected increase in revenue will trail the increase in operating expenses due
to ramp-up time, according to strategy.
First Half 2021 Financial Highlights
Revenue in the first half 2021 was NOK 356.8 million, up 13.9% from NOK 313.2
million in the first half 2020, driven by higher revenues from Pexip as-a
-Service.
Cost of sale was NOK 36.0 million, reflecting a gross margin of 90%, up from NOK
15.0 million year-on-year, due to higher hosting and network cost related to
higher usage of Pexip as-a-Service, as well as a shift towards cloud compute
from investing in own hardware.
Salary and personnel expenses amounted to NOK 324.1 million in the period (91%
of revenue), up from NOK 152.4 million (49% of revenue). The increase is mainly
due to high growth in employees over the last twelve months, in line with
Pexip’s growth strategy.
Reported EBITDA in was negative NOK 93.8 million, reflecting a negative 26%
margin, down from NOK 29.9 million in first half 2020. The development in the
EBITDA margin is as expected, as the company invests into growth initiatives
where the expected increase in revenue will trail the increase in operating
expenses due to ramp-up time, according to strategy.
Outlook
In the long-term, Pexip believes that the growth of enterprise-grade video
communication will increase due to the explosive adoption and usage of video
communication following Covid-19, and implementation of sustainability measures.
Many enterprises plan to adopt hybrid working models as they return to the
office, combining office and remote working, that will provide benefits far
beyond the need for social distancing, such as reducing travel and related
emissions, enabling work flexibility and increasing productivity. Furthermore,
Pexip believes in increased use of video in organizations’ workflows with their
clients/customers, creating additional new and significant market opportunities.
To accelerate growth Pexip has invested in increasing the Company’s sales and
marketing presence as well as R&D capabilities, and expects to continue to do
so. Pexip intends to deploy up to 70% of the net proceeds from the IPO over the
next two to three years. This implies returning to a neutral EBITDA in 2023, and
an estimated negative EBITDA-rate in 2021 and 2022 in the range of negative 25
-35%. As Pexip exits the investment period, the Company expects above 25% EBITDA
-rate in 2025 together with revenue growth above 25%. The key enabler for all
these initiatives is strengthening the Pexip team, and Pexip is targeting 550
-600 employees by the end of 2021.
Analyst consensus estimates
Every quarter ahead of the earnings announcement, Pexip collects earnings
estimates from the equity analysts currently covering the company. The consensus
estimates and the methodology used in preparation of the consensus estimates are
published on the company’s IR webpages here:
Investor - Consensus .
Webcast presentation
The second quarter results for 2021 will be presented in a live video webcast
Thursday, August 12, at 17:00 CET. The presentation will be held in English by
Odd Sverre Østlie (CEO), Øystein Hem (CFO) and Åsmund Fodstad (President Global
Sales and APAC). Please register using this form: https://www.pexip.com/q2-2021
-results-webinar-registration. Questions can be submitted to IR@pexip.com.
This information is subject to the disclosure requirements pursuant to Section 5
-12 the Norwegian Securities Trading Act.
Contact persons:
Investors: Mirza Koristovic, Director Investor Relations, IR@pexip.com, +47 93
87 05 25
Media: Lars-Einar Petterson, Communication Manager,
Lars.einar.petterson@pexip.com, +47 93 44 88 27
About Pexip | pexip.com
Pexip simplifies complex videoconferencing to empower organizations with face-to
-face collaboration, no matter the location or technology. Our scalable platform
enables high-quality video meetings, with enterprise-grade security, and is
easily adapted to fit customers’ IT requirements and existing infrastructure.
This makes Pexip the leading provider for large enterprises and public sector
organizations. The solution is sold through 300 channel partners in 75 countries
and used in more than 190 countries. Pexip was listed on the Oslo Børs in May
2020.
Kilde
Må innrømme at jeg kan lite om Pexip sin tech iforhold til konkurrentene. Så vanskelig for meg å dannet et kortsiktig bilde over verdi& framtidig marketandel. Men satser på at fokuset på sikkerheten gjør at mange offentlige etater velger dem som aktør.