In Q1 2024, CM.com kept a tight grip on costs, while growing gross profit. The product mix remained skewed towards higher margins business, resulting in higher gross profit. OPEX came in lower compared to Q1 2023. As a result, normalized EBITDA reached a record level in Q1 2024. CM.com expects year-over-year revenue development to improve as of Q2 2024. Normalized OPEX is expected to decrease approximately 15% in full year 2024 versus 2023. CM.com reiterates to become free cash flow positive by H2 2024 as EBITDA growth is expected to continue.
Breda, 17 April 2024
Q1 2024 Financial Highlights
- Normalized EBITDA grew to a record level of €3.3 million (€-2.4 million in Q1 2023).
- Gross Profit reached €19.5 million, +3% YoY.
- Gross margin was strong at 30.8% (26.5% in Q1 2023).
- Normalized OPEX came in at €16.3 million, -23% YoY.
- Revenue reached €63.5 million, -11% YoY following the shift to value over revenue. Annual Recurring Revenue grew 6% YoY to €32.0 million.
Q1 2024 Business Highlights
- Juniper Research recognized CM.com as ‘Established leader’ in CPaaS vendor space.
- In the business unit Connect (former CPaaS), focus remained on improving margins. Total number of messaging grew 18% YoY and WhatsApp grew to 30% of total messaging volume.
- In the business unit Engage (former SaaS), new order intake developed well. One of the largest soft drink companies in the world signed up for CM.com’s Marketing Cloud product for its global direct marketing communication. GenAI is now an integrated part of the offering as over 50% of all new contracts signed include GenAI.
- In the business unit Pay (former Payments), migration onto the new processing platform is in final stages of completion. POS sales has good traction. Total volume of payments processed grew 31% YoY.
- In the business unit Live (former Ticketing), growth momentum remained good. Number of tickets sold grew 10% YoY and the app development service expanded its services to more international.
Outlook
- CM.com expects normalized EBITDA to grow further in 2024.
- Normalized OPEX is expected to decrease approximately 15% in 2024 versus 2023.
- CM.com expects year-over-year revenue development to improve as of Q2 2024.
- CM.com reiterates its target to be free cash flow positive by H2 2024.
Message from the CEO
Today CM.com releases its Q1 2024 trading update. In Q1 2024, we are reporting a record EBITDA, as the value over revenue strategy continued to support overall performance, while costs remained under control.
Operational excellence continued. With the launch of Business Units in Q1 2024, the interaction between different disciplines intensified, which has already resulted in improved offerings to clients. Clients express the wish to connect to one place that offers multiple services seamlessly. That lies at the core of the CM.com proposition. As an example, GenAI has, within six months, become a standard feature in the software proposition of Engage and a good driver for growth already. The Pay proposition is now an integrated part of the product offering, especially within Live. Clients that purchase CM.com’s software solutions also seek ways to improve their communication with their end users. CM.com’s messaging offering via Connect is then a compelling addition, enabling the combination of multiple services into one place. This is increasingly the case with WhatsApp. In Q1 2024, 30% of the total messaging volume was generated through CM.com’s WhatsApp offering. What is interesting to note here is that clients see the WhatsApp product now increasingly as a viable alternative to SMS, given the possibilities it offers, but also given the rising rates for SMS in certain regions. CM.com is proud to be recognized again as “Established Leader” in CPaaS by Juniper Research.
As efficiency continues to improve and new orders are being won, CM.com has full confidence that it will be able to meet its financial milestones in 2024 and beyond. That is why CM.com expects normalized EBITDA to grow further throughout 2024, and reiterates its guidance to be free cash flow positive by H2 2024.
Jeroen van Glabbeek
CEO CM.com