Everbridge Announces Second Quarter 2022 Financial Results

Second quarter results reflect progress on 2022 Strategic Realignment

Everbridge, Inc. (NASDAQ: EVBG), the global leader in critical event management (CEM) and national public warning solutions, today announced its financial results for the second quarter ended June 30, 2022. Revenue was $103.0 million, up 19% year-over-year.

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Everbridge Announces Second Quarter 2022 Financial Results

David Wagner, Everbridge’s recently appointed President and CEO said, “I am excited to join Everbridge at this important moment in the Company’s evolution. Everbridge is a pioneer and the clear industry leader in Critical Event Management and Public Warning. Everbridge offers powerful solutions for positive change with the ability to keep people safe and businesses running smoothly. I look forward to partnering with Patrick, Vernon and the entire Everbridge team to build on our commitment to growth, sustainable profitability, and increased shareholder value.”

“We delivered strong second quarter results and large enterprise deal momentum, demonstrating that our recent actions to streamline, integrate, and reduce complexity across our product portfolio are beginning to pay off for our customers,” said Vernon Irvin, Executive Vice President and Chief Revenue Officer. “We are looking forward to sustaining our progress in the second half of the year as we continue to expand our go-to-market channels and partnerships for our strategic CEM bundles and extend our global leadership in Public Warning systems.”

Patrick Brickley, Executive Vice President and Chief Financial Officer, added, “At the half-way point in the year, we have achieved planned milestones related to our strategic realignment of resources outlined at the start of 2022. We are on track to achieve mid-teens adjusted EBITDA margin exiting the year and remain focused on driving sustainable revenue growth with increasing profitability.”

Recent Business Highlights

• Ended the second quarter with 6,345 global enterprise customers, up from 5,890 at the end of the second quarter of 2021.
• Awarded contract by State of Maharashtra, India’s second most populous state, to provide emergency preparedness and response solutions to protect 150 million residents and annual tourists.
• Joined the Amazon Web Services ISV Accelerate Program, expanding Everbridge’s go-to-market ecosystem and supporting AWS customers with their enterprise resilience and emergency response strategies for digital and physical critical events.
• Entered into strategic partnership with Grupo Siayec, a leading provider of digital and physical security solutions in Latin America, to expand CEM adoption across the Mexican enterprise market.
• Unveiled Service Intelligence, part of Everbridge’s Digital Operations platform, providing IT responders with advanced analytics to enable instant insight into digital disruptions, accelerating IT incident response while reducing time-consuming unplanned work and business impact.
• Introduced the results of its first annual Best in Resilience^TM study measuring organizational risk readiness as more global brands including Humana, Exact Sciences, Johnson Controls, and Medtronic achieve Best in Resilience^TM certification.
• Received a 2022 Edison Award recognizing innovation for Public Warning Center, the industry’s only all-channel, intelligent population alerting platform with a first-of-its-kind hybrid Cell Broadcast and Location-Based SMS alerting gateway.
• Awarded for Best Company Leadership and Best Professional Development by leading workplace culture site Comparably.

Second Quarter 2022 Financial Summary

• Total revenue was $103.0 million, an increase of 19% compared to $86.6 million for the second quarter of 2021.
• GAAP operating loss was $(36.1) million, compared to a GAAP operating loss of $(27.4) million for the second quarter of 2021.
• Non-GAAP operating profit was $1.0 million, compared to non-GAAP operating loss of $(1.9) million for the second quarter of 2021.
• GAAP net loss was $(36.2) million, compared to $(33.8) million for the second quarter of 2021. GAAP net loss per share was $(0.91), based on 39.6 million basic and diluted weighted average common shares outstanding, compared to $(0.89) for the second quarter of 2021, based on 38.0 million basic and diluted weighted average common shares outstanding.
• Non-GAAP net income was $1.5 million, compared to non-GAAP net income of $1.5 million in the second quarter of 2021. Non-GAAP diluted net income per share was $0.03, based on 46.0 million diluted weighted average common shares outstanding, compared to non-GAAP diluted net income per share of $0.03 for the second quarter of 2021, based on 45.1 million diluted weighted average common shares outstanding.
• Adjusted EBITDA was $4.8 million, compared to $0.5 million in the second quarter of 2021.
• Cash flow from operations was an outflow of $(9.9) million, compared to an outflow of $(5.1) million for the second quarter of 2021.
• Adjusted free cash flow was an outflow of $(7.6) million compared to an outflow of $(9.0) million for the second quarter of 2021.

Financial Outlook

Based on information available as of today, Everbridge is issuing guidance for the third quarter and full year 2022 as indicated below.

(All figures in millions, except per share data)

Conference Call Information

About Everbridge

Everbridge, Inc. (NASDAQ: EVBG) is a global software company that provides enterprise software applications that automate and accelerate organizations’ operational response to critical events in order to Keep People Safe and Organizations Running™. During public safety threats such as active shooter situations, terrorist attacks or severe weather conditions, as well as critical business events including IT outages, cyber-attacks, product recalls or supply-chain interruptions, over 6,300 customers in 76 countries rely on the Company’s Critical Event Management Platform to quickly and reliably aggregate and assess threat data, locate people at risk and responders able to assist, automate the execution of pre-defined communications processes through the secure delivery to over 100 different communication modalities, and track progress on executing response plans. For more information, visit www.everbridge.com, read the company blog, and follow on Twitter and Facebook.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP sales and marketing, non-GAAP research and development, non-GAAP general and administrative, non-GAAP operating expenses, non-GAAP operating income/(loss), non-GAAP net income/(loss), non-GAAP net income/(loss) per share, EBITDA, adjusted EBITDA, free cash flow, and adjusted free cash flow.

Non-GAAP operating income/(loss) excludes amortization of acquired intangible assets, change in fair value of contingent consideration, stock-based compensation and costs related to the 2022 Strategic Realignment. Non-GAAP net income/(loss) excludes amortization of acquired intangible assets, change in fair value of contingent consideration, stock-based compensation, costs related to the 2022 Strategic Realignment, accretion of interest on convertible senior notes, gain/(loss) on extinguishment of debt and capped call modification and the tax impact of such adjustments. EBITDA represents net income/(loss) before interest income and interest expense, income tax expense and benefit and depreciation and amortization expense. Adjusted EBITDA represents EBITDA as further adjusted for gain/(loss) on extinguishment of debt and capped call modification, change in fair value of contingent consideration, stock-based compensation expense and costs related to the 2022 Strategic Realignment. Free cash flow represents cash provided by (used in) operating activities minus cash used for capital expenditures and capitalized software development costs. Adjusted free cash flow represents free cash flow as further adjusted for cash payments for the 2022 Strategic Realignment.

We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Everbridge's financial condition and results of operations. We use these non-GAAP measures for financial, operational and budgetary decision-making purposes, to understand and evaluate our core operating performance and trends, and to generate future operating plans. We believe that these non-GAAP financial measures provide useful information regarding past financial performance and future prospects, and permit us to more thoroughly analyze key financial metrics used to make operational decisions. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

We do not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. We urge investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures, which are included in this press release, and not to rely on any single financial measure to evaluate our business.

Cautionary Language Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the anticipated opportunity and trends for growth in our critical communications and enterprise safety applications and our overall business, our market opportunity, our expectations regarding sales of our products, our goal to maintain market leadership and extend the markets in which we compete for customers, and our expected financial results for the third quarter of 2022 and the full fiscal year 2022. These forward-looking statements are made as of the date of this press release and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "could," "intend," variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: the ability of our products and services to perform as intended and meet our customers’ expectations; our ability to attract new customers and retain and increase sales to existing customers; our ability to increase sales of our Mass Notification application and/or ability to increase sales of our other applications; our ability to successfully integrate businesses and assets that we have acquired or may acquire in the future; the impact of the global COVID-19 pandemic on our operations and those of our customers and suppliers; the success of the 2022 Strategic Realignment; developments in the market for targeted and contextually relevant critical communications or the associated regulatory environment; our estimates of market opportunity and forecasts of market growth may prove to be inaccurate; we have not been profitable on a consistent basis historically and may not achieve or maintain profitability in the future; the lengthy and unpredictable sales cycles for new customers; nature of our business exposes us to inherent liability risks; our ability to attract, integrate and retain qualified personnel; our ability to maintain successful relationships with our channel partners and technology partners; our ability to manage our growth effectively; our ability to respond to competitive pressures; potential liability related to privacy and security of personally identifiable information; our ability to protect our intellectual property rights, and the other risks detailed in our risk factors discussed in filings with the U.S. Securities and Exchange Commission (“SEC”), including but not limited to our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 filed with the SEC on May 9, 2022 and our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on February 25, 2022. The forward-looking statements included in this press release represent our views as of the date of this press release. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

All Everbridge products are trademarks of Everbridge, Inc. in the USA and other countries. All other product or company names mentioned are the property of their respective owners.