01—Abstract
Summary
Summary of the 10-Q filed June 6, 2023. Cited figures are marked; the original filing is the authoritative source.
Samsara Inc. reported first-quarter fiscal 2024 results for the three months ended April 29, 2023.
Revenue was $204.3 milliona, up 43% from $142.6 million in the prior-year period, driven mainly by an increase in customer count and increased purchases of subscriptions, including additional applications, by existing customers. Subscription revenue was $199.5 million. Gross margin was 72%, unchanged year over year.
Net loss narrowed slightly to $67.9 millionb from $71.0 million, while operating expenses rose to $222.6 million from $173.2 million, with research and development up 47% and sales and marketing up 36%. Non-GAAP net loss was $11.1 million compared with $26.3 million a year earlier, and adjusted free cash flow was negative $2.2 million versus negative $50.7 million. Annual recurring revenue (ARR) reached $856.2 million, up from $607.2 million, and customers above $100,000 in ARR increased to 1,375 from 897.
Remaining performance obligations were $1,515.4 millionc, with about $741.5 million expected to be recognized over the next 12 months. Cash, cash equivalents, and short- and long-term investments totaled $813.8 million at quarter-end, and the company stated that existing resources should be sufficient for working capital and capital expenditure needs for at least the next 12 months. Operating cash flow was positive at $10.5 million, helped by $10.5 million of tenant allowances received and offset by a $9.8 million prepayment of rent.
The company continues to report losses and an accumulated deficit of $1,236.2 milliond, and it expects operating expenses to keep rising. Stock-based compensation was $52.9 million for the quarter, with $555.0 million of unrecognized RSU expense remaining. The filing also notes a full valuation allowance on U.S. deferred tax assets and an ongoing lease-related lawsuit with a former landlord, whose outcome is described as uncertain.
02—Key points
Key Highlights
- Revenue of $204.3 million, up 43% year over year from $142.6 million; subscription revenue was $199.5 million.
- Gross margin held at 72%, and net loss narrowed to $67.9 million from $71.0 million.
- Non-GAAP net loss improved to $11.1 million from $26.3 million, and adjusted free cash flow was negative $2.2 million versus negative $50.7 million a year earlier.
- ARR rose to $856.2 million from $607.2 million, and customers above $100,000 in ARR grew to 1,375 from 897.
- Remaining performance obligations totaled $1,515.4 million, with about $741.5 million expected to be recognized over the next 12 months.
- Cash, cash equivalents, and investments totaled $813.8 million, and operating cash flow was positive at $10.5 million.
- Operating expenses rose to $222.6 million from $173.2 million, with the company expecting continued increases in absolute dollars for R&D, sales and marketing, and G&A.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2024, Samsara lost $0.33.
- Revenue$204.3M100.0%
- Cost of revenue−$57.6M28.2%
- Gross profit$146.8M71.8%
- Operating costs−$222.6M108.9%
- Operating income−$75.8M37.1%
- Interest, other & tax$8.0M3.9%
- Net income−$67.9M33.2%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed June 6, 2023Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $204.32M$142.65M | +43.2% |
| Cost of Revenue | $57.56M$39.62M | +45.3% |
| Gross Profit | $146.76M$103.03M | +42.5% |
| R&D Expenses | $60.37M$40.98M | +47.3% |
| Operating Expenses | $222.59M$173.23M | +28.5% |
| Operating Income | -$75.82M-$70.20M | −8.0% |
| Net Income | -$67.86M-$70.99M | +4.4% |
| EPS (Basic) | $-0.13$-0.14 | +7.1% |
| EPS (Diluted) | $-0.13$-0.14 | +7.1% |
| Shares Outstanding (Basic) | 526.40M507.30M | +3.8% |
| Shares Outstanding (Diluted) | 526.40M507.30M | +3.8% |
05—Questions
Frequently Asked Questions
Is Samsara generating cash from operations now?
In the quarter ended April 29, 2023, net cash provided by operating activities was $10.5 million, compared with a use of $48.8 million a year earlier. The filing attributes the improvement partly to $10.5 million of tenant allowances received, partially offset by a $9.8 million prepayment of rent. The company states it expects to keep generating operating losses and negative cash flows for the foreseeable future.
What is driving revenue growth?
The filing states that revenue increased $61.7 million, or 43%, primarily due to an increase in customer count and increased purchases of subscription offerings, including subscriptions to additional applications, by existing customers. Subscriptions accounted for about 98% of revenue in each of the past two fiscal years.
Does the company have enough cash to fund its operations?
Management states that its existing cash, cash equivalents, and short- and long-term investments of $813.8 million will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months. The filing also notes that the company may require additional capital in the future and may need equity or debt financing.
How significant is stock-based compensation to the financial results?
Stock-based compensation expense was $52.9 million for the quarter, versus $43.6 million a year earlier, and is a major reconciling item between GAAP and non-GAAP results. Unrecognized stock-based compensation for outstanding RSUs was $555.0 million as of April 29, 2023, expected to be recognized over a weighted-average period of about 1.6 years.
What legal matter is disclosed?
The company disclosed a lease-related lawsuit in San Francisco Superior Court. Samsara sued a landlord over a lease for premises it never adequately received, and the landlord countersued for breach and drew down an $8.7 million letter of credit. The filing states the outcome is subject to ongoing litigation and is uncertain at this time.
06—Continue