Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries ON24 Announces Second Quarter 2024 Financial Results By: ON24 via Business Wire August 06, 2024 at 16:15 PM EDT Achieved Total Revenue of $37.3 million Exceeded profitability targets for 5th consecutive quarter Generated positive free cash flow for 2nd consecutive quarter Drove sequential improvement in gross retention Experienced growth ARR uplift from momentum of early adopters of the ON24 next gen platform and AI-powered offerings ON24 (NYSE: ONTF), an intelligent engagement platform for B2B sales and marketing, today announced financial results for the second quarter ended June 30, 2024. “I am pleased with our Q2 results, as we exceeded guidance on the top and bottom line and delivered positive free cash flow. I am encouraged by another quarter of improvement in gross retention, which is trending much better than the average rates we have seen for each of the past three years,” said Sharat Sharan, co-founder and CEO of ON24. “Continued momentum of our next generation platform drove our AI-powered ACE ARR to the high teens as a percentage of growth ARR. We remain focused on driving profitable growth and establishing ourselves as the AI platform for intelligent digital engagement.” Second Quarter 2024 Financial Highlights Revenue: Revenue from our Core Platform, including services, was $36.5 million. Total revenue was $37.3 million. ARR: Core Platform ARR of $131.0 million as of June 30, 2024. Total ARR of $133.7 million as of June 30, 2024. GAAP Operating Loss was $13.1 million, compared to GAAP operating loss of $15.8 million in the second quarter of 2023. Non-GAAP Operating Loss was $0.3 million, compared to non-GAAP operating loss of $0.9 million in the second quarter of 2023. GAAP Net Loss was $11.2 million, or $(0.27) per diluted share, compared to GAAP net loss of $12.8 million, or $(0.28) per diluted share in the second quarter of 2023. Non-GAAP Net Income was $1.5 million, or $0.03 per diluted share, compared to non-GAAP net income of $2.1 million, or $0.04 per diluted share in the second quarter of 2023. Adjusted EBITDA was $0.8 million. Cash Flow: Net cash provided by operating activities was $1.4 million, compared to $4.3 million used in operating activities in the second quarter of 2023. Free cash flow was $0.9 million for the quarter, compared to $(4.9) million in the second quarter of 2023. Cash, Cash Equivalents and Marketable Securities totaled $193.8 million as of June 30, 2024. For more information regarding non-GAAP operating income (loss), non-GAAP net income (loss) and free cash flows, see the section titled “Non-GAAP Financial Measures” below. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure, see the tables at the end of this press release. Recent Business Highlights: Drove sequential and YoY Core ARR growth in Q2 in life sciences and financial services verticals. Thousands of ON24 customers and prospects gathered for annual virtual user conference, The ON24 Experience, on June 11 – 14, where industry-leading enterprises, including Autodesk, Guardian, SAP and UCB, were named winners of the 2024 ON24 Digital Engagement Excellence Awards for delivering exceptional customer experiences and significant revenue impact. Financial Outlook For the third quarter of 2024, ON24 expects: Core Platform Revenue, including services, to be in the range of $34.2 million to $35.2 million. Total revenue of $35.0 million to $36.0 million. Non-GAAP operating loss of $2.3 million to $1.3 million. Non-GAAP net loss per share of $(0.01) to non-GAAP net income per share of $0.01 using approximately 42.0 million basic and diluted shares outstanding and 46.0 million diluted shares outstanding, respectively. Restructuring charge of $0.4 million to $0.7 million, excluded from the non-GAAP amounts above. For the full year 2024, ON24 now expects: Core Platform Revenue, including services, to be in the range of $141.7 million to $144.5 million. Total revenue of $145.0 million to $147.8 million. Non-GAAP operating loss of $4.5 million to $3.0 million. Non-GAAP net income per share of $0.05 to $0.08 per share using approximately 45.5 million diluted shares outstanding. Conference Call Information ON24 will host a conference call and live webcast for analysts and investors today at 2:00 p.m. Pacific Time. Parties in the United States can access the call by dialing 877-497-9071 or 201-689-8727. A webcast and management’s prepared remarks for today’s call will be accessible on ON24’s investor relations website at investors.on24.com. Approximately one hour after completion of the live call, an archived version of the webcast will be available on the Company’s investor relations website. Definitions of Certain Key Business Metrics Core Platform: The ON24 Core Platform products include: ON24 Elite: live, interactive webinar experience that engages prospective customers in real-time and can be made available in an on-demand format. ON24 Breakouts: live breakout room experience that facilitates networking, collaboration and interactivity between users. ON24 Forums: live, interactive experience that facilitates video-to-video interaction between presenters and audiences. ON24 Go Live: live, interactive video event experience that enables presenters and attendees to engage face-to-face in real-time and can also be made available in an on-demand format. ON24 Engagement Hub: always-on, rich multimedia content experience that prospective customers can engage anytime, anywhere. ON24 Target: personalize and curate, rich landing page experience that engages specific segments of prospective customers to drive desired action. ON24 AI-powered ACE: the next generation AI-powered analytics and content engine. Annual Recurring Revenue (“ARR”): ARR is calculated as the sum of the annualized value of our subscription contracts as of the measurement date, including existing customers with expired contracts that we expect to be renewed. Our ARR amounts exclude professional services, overages from subscription customers and Legacy revenue. Non-GAAP Financial Measures In addition to our results determined in accordance with generally accepted accounting principles in the United States, or “GAAP”, we consider our non-GAAP operating income (loss), non-GAAP net income (loss), Adjusted EBITDA, and free cash flow in evaluating our operating performance. We define non-GAAP operating income (loss) as net income (loss) excluding, interest expense, other (income) expense, net, provision for income taxes, stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, impairment charges for underutilized real estate, and certain other costs. We define non-GAAP net income (loss) as net income (loss) excluding stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, charges for underutilized real estate, and certain other costs. We define Adjusted EBITDA as net income (loss) excluding interest expense, other (income) expense, net, provision for income taxes, depreciation and amortization, amortization of acquired intangible assets, amortization of cloud implementation costs, stock-based compensation, restructuring costs, impairment charges for underutilized real estate, and shareholder activism related costs. We define free cash flow as net cash provided by (used in) operating activities, less purchases of property and equipment. We use non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes, and we use free cash flow to measure and evaluate cash generated through normal business operations. We believe non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA may be helpful to investors because they provide consistency and comparability with past financial performance. We believe free cash flow may be helpful to investors because it reflects that some purchases of property and equipment are necessary to support ongoing operations, while providing a measure of cash available to acquire customers, expand within existing customers and otherwise pursue our business strategies. However, these non-GAAP financial measures are each presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Non-GAAP financial measures have no standardized meanings prescribed by GAAP and are not prepared under a comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measure as a tool for comparison. We do not provide a quantitative reconciliation of the forward-looking non-GAAP financial measures included in this press release to the most directly comparable GAAP measures due to the high variability and difficulty to predict certain items excluded from these non-GAAP financial measures; in particular, the effects of stock-based compensation expense, and restructuring and transaction expenses. We expect the variability of these excluded items may have a significant, and potentially unpredictable, impact on our future GAAP financial results. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measure are included in the tables at the end of this press release. Forward-Looking Statements This document contains “forward-looking statements” under applicable securities laws. Such statements can be identified by words such as: “outlook,” “expect,” “target,” “believe,” “plan,” “future,” “may,” “should,” “will,” and similar references to future periods. Forward-looking statements include express or implied statements regarding our expected financial and operating results, the execution of our capital return program, the size of our market opportunity, the success of our new products and capabilities, including our new AI-powered Analytics and Content Engine, and other statements regarding our ability to achieve our business strategies, growth, or other future events or conditions. Such statements are based on our current beliefs, expectations, and assumptions about future events or conditions, which are subject to inherent risks and uncertainties, including our ability to attract new customers and expand sales to existing customers, decline in our growth rate; fluctuation in our performance, our history of net losses and expected increases in our expenses; competition and technological development in our markets and any decline in demand for our solutions; our ability to expand our sales and marketing capabilities and otherwise achieve our growth; the impact of the resumption of in-person marketing activities on our customer growth rate; disruptions or other issues with our technology or third-party services; compliance with data privacy, import and export controls, customs, sanctions and other laws and regulations; intellectual property matters; and matters relating to our common stock, along with the other risks and uncertainties discussed in the filings we make from time to time with the Securities and Exchange Commission. Actual results may differ materially from those indicated in forward-looking statements, and you should not place undue reliance on them. All statements herein are based only on information currently available to us and speak only as of the date hereof. Except as required by law, we undertake no obligation to update any such statement. About ON24 ON24 is on a mission to help businesses bring their go-to-market strategy into the AI era and drive cost-effective revenue growth. Through its leading intelligent engagement platform, ON24 enables customers to combine best-in-class experiences with personalization and content, to capture and act on connected insights at scale. ON24 provides industry-leading companies, including 3 of the 5 largest global technology companies, 3 of the 5 top global asset management firms, 3 of the 5 largest global healthcare companies and 3 of the 5 largest global industrial companies, with a valuable source of first-party data to drive sales and marketing innovation, improve efficiency and increase business results. Headquartered in San Francisco, ON24 has offices globally in North America, EMEA and APAC. For more information, visit www.ON24.com. © 2024 ON24, Inc. All rights reserved. ON24 and the ON24 logo are trademarks owned by ON24, Inc., and are registered in the United States Patent and Trademark Office and in other countries. ON24, INC. Condensed Consolidated Balance Sheets (Unaudited) (in thousands) June 30, 2024 December 31, 2023 Assets Current assets Cash and cash equivalents $ 15,485 $ 53,209 Marketable securities 178,317 145,497 Accounts receivable, net 24,025 37,939 Deferred contract acquisition costs, current 11,932 12,428 Prepaid expenses and other current assets 6,246 4,714 Total current assets 236,005 253,787 Property and equipment, net 5,344 5,371 Operating right-of-use assets 2,269 2,981 Intangible asset, net 984 1,305 Deferred contract acquisition costs, non-current 13,391 15,756 Other long-term assets 1,019 1,102 Total assets $ 259,012 $ 280,302 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 2,014 $ 1,914 Accrued and other current liabilities 14,627 16,907 Deferred revenue 66,007 74,358 Finance lease liabilities, current — 127 Operating lease liabilities, current 2,856 2,779 Total current liabilities 85,504 96,085 Operating lease liabilities, non-current 1,101 2,483 Other long-term liabilities 1,560 1,517 Total liabilities 88,165 100,085 Stockholders’ equity Common stock 4 4 Additional paid-in capital 498,574 485,291 Accumulated deficit (327,391 ) (305,513 ) Accumulated other comprehensive income (loss) (340 ) 435 Total stockholders’ equity 170,847 180,217 Total liabilities and stockholders’ equity $ 259,012 $ 280,302 ON24, INC. Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue: Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue 37,349 42,086 75,076 85,149 Cost of revenue: Subscription and other platform(1)(4) 7,032 9,066 14,378 18,955 Professional services(1)(4) 2,506 3,134 4,942 6,451 Total cost of revenue 9,538 12,200 19,320 25,406 Gross profit 27,811 29,886 55,756 59,743 Operating expenses: Sales and marketing(1)(4) 19,457 22,628 39,531 47,045 Research and development(1)(2)(4) 9,081 10,930 18,190 22,029 General and administrative(1)(3)(4) 12,332 12,105 23,568 26,383 Total operating expenses 40,870 45,663 81,289 95,457 Loss from operations (13,059 ) (15,777 ) (25,533 ) (35,714 ) Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Loss before provision for income taxes (10,764 ) (12,617 ) (20,972 ) (30,011 ) Provision for income taxes 411 230 906 426 Net loss (11,175 ) (12,847 ) (21,878 ) (30,437 ) Net loss per share: Basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Weighted-average shares used in computing net loss per share: Basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 (1) Includes stock-based compensation as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cost of revenue Subscription and other platform $ 687 $ 709 $ 1,355 $ 1,494 Professional services 129 144 250 296 Total cost of revenue 816 853 1,605 1,790 Sales and marketing 3,338 3,555 6,396 6,612 Research and development 2,246 2,363 4,374 4,384 General and administrative 5,676 4,834 10,038 8,940 Total stock-based compensation expense $ 12,076 $ 11,605 $ 22,413 $ 21,726 (2) Research and development expense includes amortization of acquired intangible asset of $138 thousand and $276 thousand for the three and six months ended June 30, 2024, respectively, and $135 thousand and $277 thousand for the three and six months ended June 30, 2023, respectively, in connection with the Vibbio acquisition in April 2022. (3) General and administrative expense includes fees related to shareholder activism of $210 thousand and $2,656 thousand for the three and six months ended June 30, 2023, respectively. We did not incur such fees in the three and six months ended June 30, 2024. (4) The results of operations for the three and six months ended June 30, 2024 and 2023 includes restructuring costs, which primarily represent severance and related expense due to restructuring activities, and impairment charge on our headquarters’ lease, as follows: Three Months Ended June 30, 2024 Six Months Ended June 30, 2024 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 21 $ — $ 21 $ 213 $ — $ 213 Professional services 1 — 1 13 — 13 Total cost of revenue 22 — 22 226 — 226 Sales and marketing 330 — 330 1,005 — 1,005 Research and development — — — 112 — 112 General and administrative 149 — 149 339 — 339 Total restructuring costs $ 501 $ — $ 501 $ 1,682 $ — $ 1,682 Three Months Ended June 30, 2023 Six Months Ended June 30, 2023 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 720 $ 89 $ 809 $ 1,505 $ 89 $ 1,594 Professional services 50 101 151 104 101 205 Total cost of revenue 770 190 960 1,609 190 1,799 Sales and marketing 597 208 805 1,808 208 2,016 Research and development 340 472 812 1,113 472 1,585 General and administrative 52 339 391 282 339 621 Total restructuring costs $ 1,759 $ 1,209 $ 2,968 $ 4,812 $ 1,209 $ 6,021 ON24, INC. Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash flows from operating activities: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,221 1,375 2,454 2,792 Stock-based compensation expense 12,076 11,605 22,413 21,726 Amortization of deferred contract acquisition cost 3,752 3,951 7,595 7,844 Provision for allowance for doubtful accounts and billing reserves 576 798 1,201 1,699 Non-cash lease expense 388 444 779 941 Accretion of marketable securities (1,428 ) (1,885 ) (2,935 ) (3,711 ) Lease impairment charge — 1,209 — 1,209 Other 35 28 70 156 Change in operating assets and liabilities: Accounts receivable 3,922 1,339 12,713 10,744 Deferred contract acquisition cost (2,305 ) (2,717 ) (4,734 ) (6,263 ) Prepaid expenses and other assets 635 1,221 (1,743 ) (848 ) Accounts payable 478 882 344 (471 ) Accrued liabilities 1,014 (1,658 ) (2,888 ) (2,747 ) Deferred revenue (7,110 ) (6,707 ) (8,351 ) (8,994 ) Other liabilities (691 ) (1,354 ) (1,514 ) (2,123 ) Net cash provided by (used in) operating activities 1,388 (4,316 ) 3,526 (8,483 ) Cash flows from investing activities: Purchase of property and equipment (490 ) (554 ) (1,528 ) (732 ) Purchase of marketable securities (52,328 ) (76,234 ) (126,421 ) (195,825 ) Proceeds from maturities of marketable securities 53,127 77,260 91,648 276,470 Proceeds from sale of marketable securities — — 4,360 9,321 Net cash provided by (used in) investing activities 309 472 (31,941 ) 89,234 Cash flows from financing activities: Proceeds from exercise of stock options 241 629 994 884 Proceeds from issuance of common stock under ESPP 367 546 367 546 Payment for repurchase of common stock (5,006 ) (22,586 ) (10,276 ) (33,306 ) Payment of cash dividend — (49,872 ) — (49,872 ) Repayment of equipment loans (36 ) (60 ) (72 ) (131 ) Repayment of finance lease obligations (44 ) (531 ) (127 ) (942 ) Net cash used in financing activities (4,478 ) (71,874 ) (9,114 ) (82,821 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash (24 ) 99 (197 ) 229 Net decrease in cash, cash equivalents and restricted cash (2,805 ) (75,619 ) (37,726 ) (1,841 ) Cash, cash equivalents and restricted cash, beginning of period 18,377 100,947 53,298 27,169 Cash, cash equivalents and restricted cash, end of period $ 15,572 $ 25,328 $ 15,572 $ 25,328 Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets: Cash and cash equivalents $ 15,485 $ 25,158 $ 15,485 $ 25,158 Restricted cash included in other assets, non-current 87 170 87 170 Total cash, cash equivalent and restricted cash $ 15,572 $ 25,328 $ 15,572 $ 25,328 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (Unaudited) (in thousands, except share and per share data) Reconciliation of gross profit and gross margin Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP gross profit $ 27,811 $ 29,886 $ 55,756 $ 59,743 Add: Stock-based compensation 816 853 1,605 1,790 Restructuring costs 22 770 226 1,609 Impairment charge — 190 — 190 Non-GAAP gross profit $ 28,649 $ 31,699 $ 57,587 $ 63,332 GAAP gross margin 74 % 71 % 74 % 70 % Non-GAAP gross margin 77 % 75 % 77 % 74 % Reconciliation of operating expenses Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP sales and marketing $ 19,457 $ 22,628 $ 39,531 $ 47,045 Less: Stock-based compensation (3,338 ) (3,555 ) (6,396 ) (6,612 ) Restructuring costs (330 ) (597 ) (1,005 ) (1,808 ) Impairment charge — (208 ) — (208 ) Non-GAAP sales and marketing $ 15,789 $ 18,268 $ 32,130 $ 38,417 GAAP research and development $ 9,081 $ 10,930 $ 18,190 $ 22,029 Less: Stock-based compensation (2,246 ) (2,363 ) (4,374 ) (4,384 ) Restructuring costs — (340 ) (112 ) (1,113 ) Impairment charge — (472 ) — (472 ) Amortization of acquired intangible asset (138 ) (135 ) (276 ) (277 ) Non-GAAP research and development $ 6,697 $ 7,620 $ 13,428 $ 15,783 GAAP general and administrative $ 12,332 $ 12,105 $ 23,568 $ 26,383 Less: Stock-based compensation (5,676 ) (4,834 ) (10,038 ) (8,940 ) Restructuring costs (149 ) (52 ) (339 ) (282 ) Impairment charge — (339 ) — (339 ) Fees related to shareholder activism — (210 ) — (2,656 ) Non-GAAP general and administrative $ 6,507 $ 6,670 $ 13,191 $ 14,166 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of net loss to non-GAAP operating loss Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP operating loss $ (344 ) $ (859 ) $ (1,162 ) $ (5,034 ) Reconciliation of net loss to Adjusted EBITDA Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Depreciation and amortization 1,083 1,240 2,178 2,515 Amortization of acquired intangible asset 138 135 276 277 Amortization of cloud implementation costs 35 37 71 74 Stock-based compensation 12,076 11,605 22,413 21,726 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Adjusted EBITDA $ 774 $ 418 $ 1,087 $ (2,445 ) Reconciliation of net loss to non-GAAP net income Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of GAAP to Non-GAAP basic and diluted net income (loss) per share Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP basic and diluted net loss per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Weighted average common stock outstanding, basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 Net loss per share, basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Non-GAAP basic and diluted net income per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 Non-GAAP weighted-average common stock outstanding Basic 41,991,996 45,866,022 41,652,834 46,581,527 Diluted 45,802,883 50,716,390 45,713,706 51,120,544 Non-GAAP net income per share of common stock: Basic $ 0.04 $ 0.05 $ 0.06 $ 0.01 Diluted $ 0.03 $ 0.04 $ 0.05 $ — ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands) (Unaudited) Reconciliation of GAAP Cash Flow from Operating Activities to Free Cash Flow Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net cash provided by (used in) operating activities: $ 1,388 $ (4,316 ) $ 3,526 $ (8,483 ) Less: Purchases of property and equipment (490 ) (554 ) (1,528 ) (732 ) Free cash flow $ 898 $ (4,870 ) $ 1,998 $ (9,215 ) ON24, INC. Revenue (in thousands) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Core Platform Subscription and other platform $ 33,479 $ 37,000 $ 67,539 $ 74,811 Professional services 3,006 3,460 5,761 6,855 Total core platform revenue $ 36,485 $ 40,460 $ 73,300 $ 81,666 Virtual Conference Subscription and other platform $ 668 $ 1,336 $ 1,437 $ 2,889 Professional services 196 290 339 594 Total virtual conference revenue $ 864 $ 1,626 $ 1,776 $ 3,483 Revenue Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue $ 37,349 $ 42,086 $ 75,076 $ 85,149 View source version on businesswire.com: https://www.businesswire.com/news/home/20240806665591/en/Contacts Media Contact: Tessa Barron press@on24.com Investor Contact: Lauren Sloane, The Blueshirt Group for ON24 investorrelations@on24.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. 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ON24 Announces Second Quarter 2024 Financial Results By: ON24 via Business Wire August 06, 2024 at 16:15 PM EDT Achieved Total Revenue of $37.3 million Exceeded profitability targets for 5th consecutive quarter Generated positive free cash flow for 2nd consecutive quarter Drove sequential improvement in gross retention Experienced growth ARR uplift from momentum of early adopters of the ON24 next gen platform and AI-powered offerings ON24 (NYSE: ONTF), an intelligent engagement platform for B2B sales and marketing, today announced financial results for the second quarter ended June 30, 2024. “I am pleased with our Q2 results, as we exceeded guidance on the top and bottom line and delivered positive free cash flow. I am encouraged by another quarter of improvement in gross retention, which is trending much better than the average rates we have seen for each of the past three years,” said Sharat Sharan, co-founder and CEO of ON24. “Continued momentum of our next generation platform drove our AI-powered ACE ARR to the high teens as a percentage of growth ARR. We remain focused on driving profitable growth and establishing ourselves as the AI platform for intelligent digital engagement.” Second Quarter 2024 Financial Highlights Revenue: Revenue from our Core Platform, including services, was $36.5 million. Total revenue was $37.3 million. ARR: Core Platform ARR of $131.0 million as of June 30, 2024. Total ARR of $133.7 million as of June 30, 2024. GAAP Operating Loss was $13.1 million, compared to GAAP operating loss of $15.8 million in the second quarter of 2023. Non-GAAP Operating Loss was $0.3 million, compared to non-GAAP operating loss of $0.9 million in the second quarter of 2023. GAAP Net Loss was $11.2 million, or $(0.27) per diluted share, compared to GAAP net loss of $12.8 million, or $(0.28) per diluted share in the second quarter of 2023. Non-GAAP Net Income was $1.5 million, or $0.03 per diluted share, compared to non-GAAP net income of $2.1 million, or $0.04 per diluted share in the second quarter of 2023. Adjusted EBITDA was $0.8 million. Cash Flow: Net cash provided by operating activities was $1.4 million, compared to $4.3 million used in operating activities in the second quarter of 2023. Free cash flow was $0.9 million for the quarter, compared to $(4.9) million in the second quarter of 2023. Cash, Cash Equivalents and Marketable Securities totaled $193.8 million as of June 30, 2024. For more information regarding non-GAAP operating income (loss), non-GAAP net income (loss) and free cash flows, see the section titled “Non-GAAP Financial Measures” below. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure, see the tables at the end of this press release. Recent Business Highlights: Drove sequential and YoY Core ARR growth in Q2 in life sciences and financial services verticals. Thousands of ON24 customers and prospects gathered for annual virtual user conference, The ON24 Experience, on June 11 – 14, where industry-leading enterprises, including Autodesk, Guardian, SAP and UCB, were named winners of the 2024 ON24 Digital Engagement Excellence Awards for delivering exceptional customer experiences and significant revenue impact. Financial Outlook For the third quarter of 2024, ON24 expects: Core Platform Revenue, including services, to be in the range of $34.2 million to $35.2 million. Total revenue of $35.0 million to $36.0 million. Non-GAAP operating loss of $2.3 million to $1.3 million. Non-GAAP net loss per share of $(0.01) to non-GAAP net income per share of $0.01 using approximately 42.0 million basic and diluted shares outstanding and 46.0 million diluted shares outstanding, respectively. Restructuring charge of $0.4 million to $0.7 million, excluded from the non-GAAP amounts above. For the full year 2024, ON24 now expects: Core Platform Revenue, including services, to be in the range of $141.7 million to $144.5 million. Total revenue of $145.0 million to $147.8 million. Non-GAAP operating loss of $4.5 million to $3.0 million. Non-GAAP net income per share of $0.05 to $0.08 per share using approximately 45.5 million diluted shares outstanding. Conference Call Information ON24 will host a conference call and live webcast for analysts and investors today at 2:00 p.m. Pacific Time. Parties in the United States can access the call by dialing 877-497-9071 or 201-689-8727. A webcast and management’s prepared remarks for today’s call will be accessible on ON24’s investor relations website at investors.on24.com. Approximately one hour after completion of the live call, an archived version of the webcast will be available on the Company’s investor relations website. Definitions of Certain Key Business Metrics Core Platform: The ON24 Core Platform products include: ON24 Elite: live, interactive webinar experience that engages prospective customers in real-time and can be made available in an on-demand format. ON24 Breakouts: live breakout room experience that facilitates networking, collaboration and interactivity between users. ON24 Forums: live, interactive experience that facilitates video-to-video interaction between presenters and audiences. ON24 Go Live: live, interactive video event experience that enables presenters and attendees to engage face-to-face in real-time and can also be made available in an on-demand format. ON24 Engagement Hub: always-on, rich multimedia content experience that prospective customers can engage anytime, anywhere. ON24 Target: personalize and curate, rich landing page experience that engages specific segments of prospective customers to drive desired action. ON24 AI-powered ACE: the next generation AI-powered analytics and content engine. Annual Recurring Revenue (“ARR”): ARR is calculated as the sum of the annualized value of our subscription contracts as of the measurement date, including existing customers with expired contracts that we expect to be renewed. Our ARR amounts exclude professional services, overages from subscription customers and Legacy revenue. Non-GAAP Financial Measures In addition to our results determined in accordance with generally accepted accounting principles in the United States, or “GAAP”, we consider our non-GAAP operating income (loss), non-GAAP net income (loss), Adjusted EBITDA, and free cash flow in evaluating our operating performance. We define non-GAAP operating income (loss) as net income (loss) excluding, interest expense, other (income) expense, net, provision for income taxes, stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, impairment charges for underutilized real estate, and certain other costs. We define non-GAAP net income (loss) as net income (loss) excluding stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, charges for underutilized real estate, and certain other costs. We define Adjusted EBITDA as net income (loss) excluding interest expense, other (income) expense, net, provision for income taxes, depreciation and amortization, amortization of acquired intangible assets, amortization of cloud implementation costs, stock-based compensation, restructuring costs, impairment charges for underutilized real estate, and shareholder activism related costs. We define free cash flow as net cash provided by (used in) operating activities, less purchases of property and equipment. We use non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes, and we use free cash flow to measure and evaluate cash generated through normal business operations. We believe non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA may be helpful to investors because they provide consistency and comparability with past financial performance. We believe free cash flow may be helpful to investors because it reflects that some purchases of property and equipment are necessary to support ongoing operations, while providing a measure of cash available to acquire customers, expand within existing customers and otherwise pursue our business strategies. However, these non-GAAP financial measures are each presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Non-GAAP financial measures have no standardized meanings prescribed by GAAP and are not prepared under a comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measure as a tool for comparison. We do not provide a quantitative reconciliation of the forward-looking non-GAAP financial measures included in this press release to the most directly comparable GAAP measures due to the high variability and difficulty to predict certain items excluded from these non-GAAP financial measures; in particular, the effects of stock-based compensation expense, and restructuring and transaction expenses. We expect the variability of these excluded items may have a significant, and potentially unpredictable, impact on our future GAAP financial results. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measure are included in the tables at the end of this press release. Forward-Looking Statements This document contains “forward-looking statements” under applicable securities laws. Such statements can be identified by words such as: “outlook,” “expect,” “target,” “believe,” “plan,” “future,” “may,” “should,” “will,” and similar references to future periods. Forward-looking statements include express or implied statements regarding our expected financial and operating results, the execution of our capital return program, the size of our market opportunity, the success of our new products and capabilities, including our new AI-powered Analytics and Content Engine, and other statements regarding our ability to achieve our business strategies, growth, or other future events or conditions. Such statements are based on our current beliefs, expectations, and assumptions about future events or conditions, which are subject to inherent risks and uncertainties, including our ability to attract new customers and expand sales to existing customers, decline in our growth rate; fluctuation in our performance, our history of net losses and expected increases in our expenses; competition and technological development in our markets and any decline in demand for our solutions; our ability to expand our sales and marketing capabilities and otherwise achieve our growth; the impact of the resumption of in-person marketing activities on our customer growth rate; disruptions or other issues with our technology or third-party services; compliance with data privacy, import and export controls, customs, sanctions and other laws and regulations; intellectual property matters; and matters relating to our common stock, along with the other risks and uncertainties discussed in the filings we make from time to time with the Securities and Exchange Commission. Actual results may differ materially from those indicated in forward-looking statements, and you should not place undue reliance on them. All statements herein are based only on information currently available to us and speak only as of the date hereof. Except as required by law, we undertake no obligation to update any such statement. About ON24 ON24 is on a mission to help businesses bring their go-to-market strategy into the AI era and drive cost-effective revenue growth. Through its leading intelligent engagement platform, ON24 enables customers to combine best-in-class experiences with personalization and content, to capture and act on connected insights at scale. ON24 provides industry-leading companies, including 3 of the 5 largest global technology companies, 3 of the 5 top global asset management firms, 3 of the 5 largest global healthcare companies and 3 of the 5 largest global industrial companies, with a valuable source of first-party data to drive sales and marketing innovation, improve efficiency and increase business results. Headquartered in San Francisco, ON24 has offices globally in North America, EMEA and APAC. For more information, visit www.ON24.com. © 2024 ON24, Inc. All rights reserved. ON24 and the ON24 logo are trademarks owned by ON24, Inc., and are registered in the United States Patent and Trademark Office and in other countries. ON24, INC. Condensed Consolidated Balance Sheets (Unaudited) (in thousands) June 30, 2024 December 31, 2023 Assets Current assets Cash and cash equivalents $ 15,485 $ 53,209 Marketable securities 178,317 145,497 Accounts receivable, net 24,025 37,939 Deferred contract acquisition costs, current 11,932 12,428 Prepaid expenses and other current assets 6,246 4,714 Total current assets 236,005 253,787 Property and equipment, net 5,344 5,371 Operating right-of-use assets 2,269 2,981 Intangible asset, net 984 1,305 Deferred contract acquisition costs, non-current 13,391 15,756 Other long-term assets 1,019 1,102 Total assets $ 259,012 $ 280,302 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 2,014 $ 1,914 Accrued and other current liabilities 14,627 16,907 Deferred revenue 66,007 74,358 Finance lease liabilities, current — 127 Operating lease liabilities, current 2,856 2,779 Total current liabilities 85,504 96,085 Operating lease liabilities, non-current 1,101 2,483 Other long-term liabilities 1,560 1,517 Total liabilities 88,165 100,085 Stockholders’ equity Common stock 4 4 Additional paid-in capital 498,574 485,291 Accumulated deficit (327,391 ) (305,513 ) Accumulated other comprehensive income (loss) (340 ) 435 Total stockholders’ equity 170,847 180,217 Total liabilities and stockholders’ equity $ 259,012 $ 280,302 ON24, INC. Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue: Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue 37,349 42,086 75,076 85,149 Cost of revenue: Subscription and other platform(1)(4) 7,032 9,066 14,378 18,955 Professional services(1)(4) 2,506 3,134 4,942 6,451 Total cost of revenue 9,538 12,200 19,320 25,406 Gross profit 27,811 29,886 55,756 59,743 Operating expenses: Sales and marketing(1)(4) 19,457 22,628 39,531 47,045 Research and development(1)(2)(4) 9,081 10,930 18,190 22,029 General and administrative(1)(3)(4) 12,332 12,105 23,568 26,383 Total operating expenses 40,870 45,663 81,289 95,457 Loss from operations (13,059 ) (15,777 ) (25,533 ) (35,714 ) Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Loss before provision for income taxes (10,764 ) (12,617 ) (20,972 ) (30,011 ) Provision for income taxes 411 230 906 426 Net loss (11,175 ) (12,847 ) (21,878 ) (30,437 ) Net loss per share: Basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Weighted-average shares used in computing net loss per share: Basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 (1) Includes stock-based compensation as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cost of revenue Subscription and other platform $ 687 $ 709 $ 1,355 $ 1,494 Professional services 129 144 250 296 Total cost of revenue 816 853 1,605 1,790 Sales and marketing 3,338 3,555 6,396 6,612 Research and development 2,246 2,363 4,374 4,384 General and administrative 5,676 4,834 10,038 8,940 Total stock-based compensation expense $ 12,076 $ 11,605 $ 22,413 $ 21,726 (2) Research and development expense includes amortization of acquired intangible asset of $138 thousand and $276 thousand for the three and six months ended June 30, 2024, respectively, and $135 thousand and $277 thousand for the three and six months ended June 30, 2023, respectively, in connection with the Vibbio acquisition in April 2022. (3) General and administrative expense includes fees related to shareholder activism of $210 thousand and $2,656 thousand for the three and six months ended June 30, 2023, respectively. We did not incur such fees in the three and six months ended June 30, 2024. (4) The results of operations for the three and six months ended June 30, 2024 and 2023 includes restructuring costs, which primarily represent severance and related expense due to restructuring activities, and impairment charge on our headquarters’ lease, as follows: Three Months Ended June 30, 2024 Six Months Ended June 30, 2024 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 21 $ — $ 21 $ 213 $ — $ 213 Professional services 1 — 1 13 — 13 Total cost of revenue 22 — 22 226 — 226 Sales and marketing 330 — 330 1,005 — 1,005 Research and development — — — 112 — 112 General and administrative 149 — 149 339 — 339 Total restructuring costs $ 501 $ — $ 501 $ 1,682 $ — $ 1,682 Three Months Ended June 30, 2023 Six Months Ended June 30, 2023 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 720 $ 89 $ 809 $ 1,505 $ 89 $ 1,594 Professional services 50 101 151 104 101 205 Total cost of revenue 770 190 960 1,609 190 1,799 Sales and marketing 597 208 805 1,808 208 2,016 Research and development 340 472 812 1,113 472 1,585 General and administrative 52 339 391 282 339 621 Total restructuring costs $ 1,759 $ 1,209 $ 2,968 $ 4,812 $ 1,209 $ 6,021 ON24, INC. Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash flows from operating activities: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,221 1,375 2,454 2,792 Stock-based compensation expense 12,076 11,605 22,413 21,726 Amortization of deferred contract acquisition cost 3,752 3,951 7,595 7,844 Provision for allowance for doubtful accounts and billing reserves 576 798 1,201 1,699 Non-cash lease expense 388 444 779 941 Accretion of marketable securities (1,428 ) (1,885 ) (2,935 ) (3,711 ) Lease impairment charge — 1,209 — 1,209 Other 35 28 70 156 Change in operating assets and liabilities: Accounts receivable 3,922 1,339 12,713 10,744 Deferred contract acquisition cost (2,305 ) (2,717 ) (4,734 ) (6,263 ) Prepaid expenses and other assets 635 1,221 (1,743 ) (848 ) Accounts payable 478 882 344 (471 ) Accrued liabilities 1,014 (1,658 ) (2,888 ) (2,747 ) Deferred revenue (7,110 ) (6,707 ) (8,351 ) (8,994 ) Other liabilities (691 ) (1,354 ) (1,514 ) (2,123 ) Net cash provided by (used in) operating activities 1,388 (4,316 ) 3,526 (8,483 ) Cash flows from investing activities: Purchase of property and equipment (490 ) (554 ) (1,528 ) (732 ) Purchase of marketable securities (52,328 ) (76,234 ) (126,421 ) (195,825 ) Proceeds from maturities of marketable securities 53,127 77,260 91,648 276,470 Proceeds from sale of marketable securities — — 4,360 9,321 Net cash provided by (used in) investing activities 309 472 (31,941 ) 89,234 Cash flows from financing activities: Proceeds from exercise of stock options 241 629 994 884 Proceeds from issuance of common stock under ESPP 367 546 367 546 Payment for repurchase of common stock (5,006 ) (22,586 ) (10,276 ) (33,306 ) Payment of cash dividend — (49,872 ) — (49,872 ) Repayment of equipment loans (36 ) (60 ) (72 ) (131 ) Repayment of finance lease obligations (44 ) (531 ) (127 ) (942 ) Net cash used in financing activities (4,478 ) (71,874 ) (9,114 ) (82,821 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash (24 ) 99 (197 ) 229 Net decrease in cash, cash equivalents and restricted cash (2,805 ) (75,619 ) (37,726 ) (1,841 ) Cash, cash equivalents and restricted cash, beginning of period 18,377 100,947 53,298 27,169 Cash, cash equivalents and restricted cash, end of period $ 15,572 $ 25,328 $ 15,572 $ 25,328 Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets: Cash and cash equivalents $ 15,485 $ 25,158 $ 15,485 $ 25,158 Restricted cash included in other assets, non-current 87 170 87 170 Total cash, cash equivalent and restricted cash $ 15,572 $ 25,328 $ 15,572 $ 25,328 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (Unaudited) (in thousands, except share and per share data) Reconciliation of gross profit and gross margin Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP gross profit $ 27,811 $ 29,886 $ 55,756 $ 59,743 Add: Stock-based compensation 816 853 1,605 1,790 Restructuring costs 22 770 226 1,609 Impairment charge — 190 — 190 Non-GAAP gross profit $ 28,649 $ 31,699 $ 57,587 $ 63,332 GAAP gross margin 74 % 71 % 74 % 70 % Non-GAAP gross margin 77 % 75 % 77 % 74 % Reconciliation of operating expenses Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP sales and marketing $ 19,457 $ 22,628 $ 39,531 $ 47,045 Less: Stock-based compensation (3,338 ) (3,555 ) (6,396 ) (6,612 ) Restructuring costs (330 ) (597 ) (1,005 ) (1,808 ) Impairment charge — (208 ) — (208 ) Non-GAAP sales and marketing $ 15,789 $ 18,268 $ 32,130 $ 38,417 GAAP research and development $ 9,081 $ 10,930 $ 18,190 $ 22,029 Less: Stock-based compensation (2,246 ) (2,363 ) (4,374 ) (4,384 ) Restructuring costs — (340 ) (112 ) (1,113 ) Impairment charge — (472 ) — (472 ) Amortization of acquired intangible asset (138 ) (135 ) (276 ) (277 ) Non-GAAP research and development $ 6,697 $ 7,620 $ 13,428 $ 15,783 GAAP general and administrative $ 12,332 $ 12,105 $ 23,568 $ 26,383 Less: Stock-based compensation (5,676 ) (4,834 ) (10,038 ) (8,940 ) Restructuring costs (149 ) (52 ) (339 ) (282 ) Impairment charge — (339 ) — (339 ) Fees related to shareholder activism — (210 ) — (2,656 ) Non-GAAP general and administrative $ 6,507 $ 6,670 $ 13,191 $ 14,166 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of net loss to non-GAAP operating loss Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP operating loss $ (344 ) $ (859 ) $ (1,162 ) $ (5,034 ) Reconciliation of net loss to Adjusted EBITDA Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Depreciation and amortization 1,083 1,240 2,178 2,515 Amortization of acquired intangible asset 138 135 276 277 Amortization of cloud implementation costs 35 37 71 74 Stock-based compensation 12,076 11,605 22,413 21,726 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Adjusted EBITDA $ 774 $ 418 $ 1,087 $ (2,445 ) Reconciliation of net loss to non-GAAP net income Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of GAAP to Non-GAAP basic and diluted net income (loss) per share Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP basic and diluted net loss per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Weighted average common stock outstanding, basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 Net loss per share, basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Non-GAAP basic and diluted net income per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 Non-GAAP weighted-average common stock outstanding Basic 41,991,996 45,866,022 41,652,834 46,581,527 Diluted 45,802,883 50,716,390 45,713,706 51,120,544 Non-GAAP net income per share of common stock: Basic $ 0.04 $ 0.05 $ 0.06 $ 0.01 Diluted $ 0.03 $ 0.04 $ 0.05 $ — ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands) (Unaudited) Reconciliation of GAAP Cash Flow from Operating Activities to Free Cash Flow Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net cash provided by (used in) operating activities: $ 1,388 $ (4,316 ) $ 3,526 $ (8,483 ) Less: Purchases of property and equipment (490 ) (554 ) (1,528 ) (732 ) Free cash flow $ 898 $ (4,870 ) $ 1,998 $ (9,215 ) ON24, INC. Revenue (in thousands) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Core Platform Subscription and other platform $ 33,479 $ 37,000 $ 67,539 $ 74,811 Professional services 3,006 3,460 5,761 6,855 Total core platform revenue $ 36,485 $ 40,460 $ 73,300 $ 81,666 Virtual Conference Subscription and other platform $ 668 $ 1,336 $ 1,437 $ 2,889 Professional services 196 290 339 594 Total virtual conference revenue $ 864 $ 1,626 $ 1,776 $ 3,483 Revenue Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue $ 37,349 $ 42,086 $ 75,076 $ 85,149 View source version on businesswire.com: https://www.businesswire.com/news/home/20240806665591/en/Contacts Media Contact: Tessa Barron press@on24.com Investor Contact: Lauren Sloane, The Blueshirt Group for ON24 investorrelations@on24.com
Achieved Total Revenue of $37.3 million Exceeded profitability targets for 5th consecutive quarter Generated positive free cash flow for 2nd consecutive quarter Drove sequential improvement in gross retention Experienced growth ARR uplift from momentum of early adopters of the ON24 next gen platform and AI-powered offerings
ON24 (NYSE: ONTF), an intelligent engagement platform for B2B sales and marketing, today announced financial results for the second quarter ended June 30, 2024. “I am pleased with our Q2 results, as we exceeded guidance on the top and bottom line and delivered positive free cash flow. I am encouraged by another quarter of improvement in gross retention, which is trending much better than the average rates we have seen for each of the past three years,” said Sharat Sharan, co-founder and CEO of ON24. “Continued momentum of our next generation platform drove our AI-powered ACE ARR to the high teens as a percentage of growth ARR. We remain focused on driving profitable growth and establishing ourselves as the AI platform for intelligent digital engagement.” Second Quarter 2024 Financial Highlights Revenue: Revenue from our Core Platform, including services, was $36.5 million. Total revenue was $37.3 million. ARR: Core Platform ARR of $131.0 million as of June 30, 2024. Total ARR of $133.7 million as of June 30, 2024. GAAP Operating Loss was $13.1 million, compared to GAAP operating loss of $15.8 million in the second quarter of 2023. Non-GAAP Operating Loss was $0.3 million, compared to non-GAAP operating loss of $0.9 million in the second quarter of 2023. GAAP Net Loss was $11.2 million, or $(0.27) per diluted share, compared to GAAP net loss of $12.8 million, or $(0.28) per diluted share in the second quarter of 2023. Non-GAAP Net Income was $1.5 million, or $0.03 per diluted share, compared to non-GAAP net income of $2.1 million, or $0.04 per diluted share in the second quarter of 2023. Adjusted EBITDA was $0.8 million. Cash Flow: Net cash provided by operating activities was $1.4 million, compared to $4.3 million used in operating activities in the second quarter of 2023. Free cash flow was $0.9 million for the quarter, compared to $(4.9) million in the second quarter of 2023. Cash, Cash Equivalents and Marketable Securities totaled $193.8 million as of June 30, 2024. For more information regarding non-GAAP operating income (loss), non-GAAP net income (loss) and free cash flows, see the section titled “Non-GAAP Financial Measures” below. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure, see the tables at the end of this press release. Recent Business Highlights: Drove sequential and YoY Core ARR growth in Q2 in life sciences and financial services verticals. Thousands of ON24 customers and prospects gathered for annual virtual user conference, The ON24 Experience, on June 11 – 14, where industry-leading enterprises, including Autodesk, Guardian, SAP and UCB, were named winners of the 2024 ON24 Digital Engagement Excellence Awards for delivering exceptional customer experiences and significant revenue impact. Financial Outlook For the third quarter of 2024, ON24 expects: Core Platform Revenue, including services, to be in the range of $34.2 million to $35.2 million. Total revenue of $35.0 million to $36.0 million. Non-GAAP operating loss of $2.3 million to $1.3 million. Non-GAAP net loss per share of $(0.01) to non-GAAP net income per share of $0.01 using approximately 42.0 million basic and diluted shares outstanding and 46.0 million diluted shares outstanding, respectively. Restructuring charge of $0.4 million to $0.7 million, excluded from the non-GAAP amounts above. For the full year 2024, ON24 now expects: Core Platform Revenue, including services, to be in the range of $141.7 million to $144.5 million. Total revenue of $145.0 million to $147.8 million. Non-GAAP operating loss of $4.5 million to $3.0 million. Non-GAAP net income per share of $0.05 to $0.08 per share using approximately 45.5 million diluted shares outstanding. Conference Call Information ON24 will host a conference call and live webcast for analysts and investors today at 2:00 p.m. Pacific Time. Parties in the United States can access the call by dialing 877-497-9071 or 201-689-8727. A webcast and management’s prepared remarks for today’s call will be accessible on ON24’s investor relations website at investors.on24.com. Approximately one hour after completion of the live call, an archived version of the webcast will be available on the Company’s investor relations website. Definitions of Certain Key Business Metrics Core Platform: The ON24 Core Platform products include: ON24 Elite: live, interactive webinar experience that engages prospective customers in real-time and can be made available in an on-demand format. ON24 Breakouts: live breakout room experience that facilitates networking, collaboration and interactivity between users. ON24 Forums: live, interactive experience that facilitates video-to-video interaction between presenters and audiences. ON24 Go Live: live, interactive video event experience that enables presenters and attendees to engage face-to-face in real-time and can also be made available in an on-demand format. ON24 Engagement Hub: always-on, rich multimedia content experience that prospective customers can engage anytime, anywhere. ON24 Target: personalize and curate, rich landing page experience that engages specific segments of prospective customers to drive desired action. ON24 AI-powered ACE: the next generation AI-powered analytics and content engine. Annual Recurring Revenue (“ARR”): ARR is calculated as the sum of the annualized value of our subscription contracts as of the measurement date, including existing customers with expired contracts that we expect to be renewed. Our ARR amounts exclude professional services, overages from subscription customers and Legacy revenue. Non-GAAP Financial Measures In addition to our results determined in accordance with generally accepted accounting principles in the United States, or “GAAP”, we consider our non-GAAP operating income (loss), non-GAAP net income (loss), Adjusted EBITDA, and free cash flow in evaluating our operating performance. We define non-GAAP operating income (loss) as net income (loss) excluding, interest expense, other (income) expense, net, provision for income taxes, stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, impairment charges for underutilized real estate, and certain other costs. We define non-GAAP net income (loss) as net income (loss) excluding stock-based compensation, amortization of acquired intangible assets, shareholder activism related costs, restructuring costs, charges for underutilized real estate, and certain other costs. We define Adjusted EBITDA as net income (loss) excluding interest expense, other (income) expense, net, provision for income taxes, depreciation and amortization, amortization of acquired intangible assets, amortization of cloud implementation costs, stock-based compensation, restructuring costs, impairment charges for underutilized real estate, and shareholder activism related costs. We define free cash flow as net cash provided by (used in) operating activities, less purchases of property and equipment. We use non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes, and we use free cash flow to measure and evaluate cash generated through normal business operations. We believe non-GAAP operating income (loss), non-GAAP net income (loss), and Adjusted EBITDA may be helpful to investors because they provide consistency and comparability with past financial performance. We believe free cash flow may be helpful to investors because it reflects that some purchases of property and equipment are necessary to support ongoing operations, while providing a measure of cash available to acquire customers, expand within existing customers and otherwise pursue our business strategies. However, these non-GAAP financial measures are each presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Non-GAAP financial measures have no standardized meanings prescribed by GAAP and are not prepared under a comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measure as a tool for comparison. We do not provide a quantitative reconciliation of the forward-looking non-GAAP financial measures included in this press release to the most directly comparable GAAP measures due to the high variability and difficulty to predict certain items excluded from these non-GAAP financial measures; in particular, the effects of stock-based compensation expense, and restructuring and transaction expenses. We expect the variability of these excluded items may have a significant, and potentially unpredictable, impact on our future GAAP financial results. Reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measure are included in the tables at the end of this press release. Forward-Looking Statements This document contains “forward-looking statements” under applicable securities laws. Such statements can be identified by words such as: “outlook,” “expect,” “target,” “believe,” “plan,” “future,” “may,” “should,” “will,” and similar references to future periods. Forward-looking statements include express or implied statements regarding our expected financial and operating results, the execution of our capital return program, the size of our market opportunity, the success of our new products and capabilities, including our new AI-powered Analytics and Content Engine, and other statements regarding our ability to achieve our business strategies, growth, or other future events or conditions. Such statements are based on our current beliefs, expectations, and assumptions about future events or conditions, which are subject to inherent risks and uncertainties, including our ability to attract new customers and expand sales to existing customers, decline in our growth rate; fluctuation in our performance, our history of net losses and expected increases in our expenses; competition and technological development in our markets and any decline in demand for our solutions; our ability to expand our sales and marketing capabilities and otherwise achieve our growth; the impact of the resumption of in-person marketing activities on our customer growth rate; disruptions or other issues with our technology or third-party services; compliance with data privacy, import and export controls, customs, sanctions and other laws and regulations; intellectual property matters; and matters relating to our common stock, along with the other risks and uncertainties discussed in the filings we make from time to time with the Securities and Exchange Commission. Actual results may differ materially from those indicated in forward-looking statements, and you should not place undue reliance on them. All statements herein are based only on information currently available to us and speak only as of the date hereof. Except as required by law, we undertake no obligation to update any such statement. About ON24 ON24 is on a mission to help businesses bring their go-to-market strategy into the AI era and drive cost-effective revenue growth. Through its leading intelligent engagement platform, ON24 enables customers to combine best-in-class experiences with personalization and content, to capture and act on connected insights at scale. ON24 provides industry-leading companies, including 3 of the 5 largest global technology companies, 3 of the 5 top global asset management firms, 3 of the 5 largest global healthcare companies and 3 of the 5 largest global industrial companies, with a valuable source of first-party data to drive sales and marketing innovation, improve efficiency and increase business results. Headquartered in San Francisco, ON24 has offices globally in North America, EMEA and APAC. For more information, visit www.ON24.com. © 2024 ON24, Inc. All rights reserved. ON24 and the ON24 logo are trademarks owned by ON24, Inc., and are registered in the United States Patent and Trademark Office and in other countries. ON24, INC. Condensed Consolidated Balance Sheets (Unaudited) (in thousands) June 30, 2024 December 31, 2023 Assets Current assets Cash and cash equivalents $ 15,485 $ 53,209 Marketable securities 178,317 145,497 Accounts receivable, net 24,025 37,939 Deferred contract acquisition costs, current 11,932 12,428 Prepaid expenses and other current assets 6,246 4,714 Total current assets 236,005 253,787 Property and equipment, net 5,344 5,371 Operating right-of-use assets 2,269 2,981 Intangible asset, net 984 1,305 Deferred contract acquisition costs, non-current 13,391 15,756 Other long-term assets 1,019 1,102 Total assets $ 259,012 $ 280,302 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 2,014 $ 1,914 Accrued and other current liabilities 14,627 16,907 Deferred revenue 66,007 74,358 Finance lease liabilities, current — 127 Operating lease liabilities, current 2,856 2,779 Total current liabilities 85,504 96,085 Operating lease liabilities, non-current 1,101 2,483 Other long-term liabilities 1,560 1,517 Total liabilities 88,165 100,085 Stockholders’ equity Common stock 4 4 Additional paid-in capital 498,574 485,291 Accumulated deficit (327,391 ) (305,513 ) Accumulated other comprehensive income (loss) (340 ) 435 Total stockholders’ equity 170,847 180,217 Total liabilities and stockholders’ equity $ 259,012 $ 280,302 ON24, INC. Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except share and per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue: Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue 37,349 42,086 75,076 85,149 Cost of revenue: Subscription and other platform(1)(4) 7,032 9,066 14,378 18,955 Professional services(1)(4) 2,506 3,134 4,942 6,451 Total cost of revenue 9,538 12,200 19,320 25,406 Gross profit 27,811 29,886 55,756 59,743 Operating expenses: Sales and marketing(1)(4) 19,457 22,628 39,531 47,045 Research and development(1)(2)(4) 9,081 10,930 18,190 22,029 General and administrative(1)(3)(4) 12,332 12,105 23,568 26,383 Total operating expenses 40,870 45,663 81,289 95,457 Loss from operations (13,059 ) (15,777 ) (25,533 ) (35,714 ) Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Loss before provision for income taxes (10,764 ) (12,617 ) (20,972 ) (30,011 ) Provision for income taxes 411 230 906 426 Net loss (11,175 ) (12,847 ) (21,878 ) (30,437 ) Net loss per share: Basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Weighted-average shares used in computing net loss per share: Basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 (1) Includes stock-based compensation as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cost of revenue Subscription and other platform $ 687 $ 709 $ 1,355 $ 1,494 Professional services 129 144 250 296 Total cost of revenue 816 853 1,605 1,790 Sales and marketing 3,338 3,555 6,396 6,612 Research and development 2,246 2,363 4,374 4,384 General and administrative 5,676 4,834 10,038 8,940 Total stock-based compensation expense $ 12,076 $ 11,605 $ 22,413 $ 21,726 (2) Research and development expense includes amortization of acquired intangible asset of $138 thousand and $276 thousand for the three and six months ended June 30, 2024, respectively, and $135 thousand and $277 thousand for the three and six months ended June 30, 2023, respectively, in connection with the Vibbio acquisition in April 2022. (3) General and administrative expense includes fees related to shareholder activism of $210 thousand and $2,656 thousand for the three and six months ended June 30, 2023, respectively. We did not incur such fees in the three and six months ended June 30, 2024. (4) The results of operations for the three and six months ended June 30, 2024 and 2023 includes restructuring costs, which primarily represent severance and related expense due to restructuring activities, and impairment charge on our headquarters’ lease, as follows: Three Months Ended June 30, 2024 Six Months Ended June 30, 2024 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 21 $ — $ 21 $ 213 $ — $ 213 Professional services 1 — 1 13 — 13 Total cost of revenue 22 — 22 226 — 226 Sales and marketing 330 — 330 1,005 — 1,005 Research and development — — — 112 — 112 General and administrative 149 — 149 339 — 339 Total restructuring costs $ 501 $ — $ 501 $ 1,682 $ — $ 1,682 Three Months Ended June 30, 2023 Six Months Ended June 30, 2023 Severance and related Charges Lease Impairment Charge Total Severance and related Charges Lease Impairment Charge Total Cost of revenue Subscription and other platform $ 720 $ 89 $ 809 $ 1,505 $ 89 $ 1,594 Professional services 50 101 151 104 101 205 Total cost of revenue 770 190 960 1,609 190 1,799 Sales and marketing 597 208 805 1,808 208 2,016 Research and development 340 472 812 1,113 472 1,585 General and administrative 52 339 391 282 339 621 Total restructuring costs $ 1,759 $ 1,209 $ 2,968 $ 4,812 $ 1,209 $ 6,021 ON24, INC. Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash flows from operating activities: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,221 1,375 2,454 2,792 Stock-based compensation expense 12,076 11,605 22,413 21,726 Amortization of deferred contract acquisition cost 3,752 3,951 7,595 7,844 Provision for allowance for doubtful accounts and billing reserves 576 798 1,201 1,699 Non-cash lease expense 388 444 779 941 Accretion of marketable securities (1,428 ) (1,885 ) (2,935 ) (3,711 ) Lease impairment charge — 1,209 — 1,209 Other 35 28 70 156 Change in operating assets and liabilities: Accounts receivable 3,922 1,339 12,713 10,744 Deferred contract acquisition cost (2,305 ) (2,717 ) (4,734 ) (6,263 ) Prepaid expenses and other assets 635 1,221 (1,743 ) (848 ) Accounts payable 478 882 344 (471 ) Accrued liabilities 1,014 (1,658 ) (2,888 ) (2,747 ) Deferred revenue (7,110 ) (6,707 ) (8,351 ) (8,994 ) Other liabilities (691 ) (1,354 ) (1,514 ) (2,123 ) Net cash provided by (used in) operating activities 1,388 (4,316 ) 3,526 (8,483 ) Cash flows from investing activities: Purchase of property and equipment (490 ) (554 ) (1,528 ) (732 ) Purchase of marketable securities (52,328 ) (76,234 ) (126,421 ) (195,825 ) Proceeds from maturities of marketable securities 53,127 77,260 91,648 276,470 Proceeds from sale of marketable securities — — 4,360 9,321 Net cash provided by (used in) investing activities 309 472 (31,941 ) 89,234 Cash flows from financing activities: Proceeds from exercise of stock options 241 629 994 884 Proceeds from issuance of common stock under ESPP 367 546 367 546 Payment for repurchase of common stock (5,006 ) (22,586 ) (10,276 ) (33,306 ) Payment of cash dividend — (49,872 ) — (49,872 ) Repayment of equipment loans (36 ) (60 ) (72 ) (131 ) Repayment of finance lease obligations (44 ) (531 ) (127 ) (942 ) Net cash used in financing activities (4,478 ) (71,874 ) (9,114 ) (82,821 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash (24 ) 99 (197 ) 229 Net decrease in cash, cash equivalents and restricted cash (2,805 ) (75,619 ) (37,726 ) (1,841 ) Cash, cash equivalents and restricted cash, beginning of period 18,377 100,947 53,298 27,169 Cash, cash equivalents and restricted cash, end of period $ 15,572 $ 25,328 $ 15,572 $ 25,328 Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets: Cash and cash equivalents $ 15,485 $ 25,158 $ 15,485 $ 25,158 Restricted cash included in other assets, non-current 87 170 87 170 Total cash, cash equivalent and restricted cash $ 15,572 $ 25,328 $ 15,572 $ 25,328 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (Unaudited) (in thousands, except share and per share data) Reconciliation of gross profit and gross margin Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP gross profit $ 27,811 $ 29,886 $ 55,756 $ 59,743 Add: Stock-based compensation 816 853 1,605 1,790 Restructuring costs 22 770 226 1,609 Impairment charge — 190 — 190 Non-GAAP gross profit $ 28,649 $ 31,699 $ 57,587 $ 63,332 GAAP gross margin 74 % 71 % 74 % 70 % Non-GAAP gross margin 77 % 75 % 77 % 74 % Reconciliation of operating expenses Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP sales and marketing $ 19,457 $ 22,628 $ 39,531 $ 47,045 Less: Stock-based compensation (3,338 ) (3,555 ) (6,396 ) (6,612 ) Restructuring costs (330 ) (597 ) (1,005 ) (1,808 ) Impairment charge — (208 ) — (208 ) Non-GAAP sales and marketing $ 15,789 $ 18,268 $ 32,130 $ 38,417 GAAP research and development $ 9,081 $ 10,930 $ 18,190 $ 22,029 Less: Stock-based compensation (2,246 ) (2,363 ) (4,374 ) (4,384 ) Restructuring costs — (340 ) (112 ) (1,113 ) Impairment charge — (472 ) — (472 ) Amortization of acquired intangible asset (138 ) (135 ) (276 ) (277 ) Non-GAAP research and development $ 6,697 $ 7,620 $ 13,428 $ 15,783 GAAP general and administrative $ 12,332 $ 12,105 $ 23,568 $ 26,383 Less: Stock-based compensation (5,676 ) (4,834 ) (10,038 ) (8,940 ) Restructuring costs (149 ) (52 ) (339 ) (282 ) Impairment charge — (339 ) — (339 ) Fees related to shareholder activism — (210 ) — (2,656 ) Non-GAAP general and administrative $ 6,507 $ 6,670 $ 13,191 $ 14,166 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of net loss to non-GAAP operating loss Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP operating loss $ (344 ) $ (859 ) $ (1,162 ) $ (5,034 ) Reconciliation of net loss to Adjusted EBITDA Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Interest expense 10 33 21 62 Other income, net (2,305 ) (3,193 ) (4,582 ) (5,765 ) Provision for income taxes 411 230 906 426 Depreciation and amortization 1,083 1,240 2,178 2,515 Amortization of acquired intangible asset 138 135 276 277 Amortization of cloud implementation costs 35 37 71 74 Stock-based compensation 12,076 11,605 22,413 21,726 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Adjusted EBITDA $ 774 $ 418 $ 1,087 $ (2,445 ) Reconciliation of net loss to non-GAAP net income Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands, except share and per share data) (Unaudited) Reconciliation of GAAP to Non-GAAP basic and diluted net income (loss) per share Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP basic and diluted net loss per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Weighted average common stock outstanding, basic and diluted 41,991,996 45,866,022 41,652,834 46,581,527 Net loss per share, basic and diluted $ (0.27 ) $ (0.28 ) $ (0.53 ) $ (0.65 ) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Non-GAAP basic and diluted net income per share: Net loss $ (11,175 ) $ (12,847 ) $ (21,878 ) $ (30,437 ) Add: Stock-based compensation 12,076 11,605 22,413 21,726 Amortization of acquired intangible asset 138 135 276 277 Restructuring costs 501 1,759 1,682 4,812 Impairment charge — 1,209 — 1,209 Fees related to shareholder activism — 210 — 2,656 Non-GAAP net income $ 1,540 $ 2,071 $ 2,493 $ 243 Non-GAAP weighted-average common stock outstanding Basic 41,991,996 45,866,022 41,652,834 46,581,527 Diluted 45,802,883 50,716,390 45,713,706 51,120,544 Non-GAAP net income per share of common stock: Basic $ 0.04 $ 0.05 $ 0.06 $ 0.01 Diluted $ 0.03 $ 0.04 $ 0.05 $ — ON24, INC. Reconciliation of GAAP to Non-GAAP Results (in thousands) (Unaudited) Reconciliation of GAAP Cash Flow from Operating Activities to Free Cash Flow Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net cash provided by (used in) operating activities: $ 1,388 $ (4,316 ) $ 3,526 $ (8,483 ) Less: Purchases of property and equipment (490 ) (554 ) (1,528 ) (732 ) Free cash flow $ 898 $ (4,870 ) $ 1,998 $ (9,215 ) ON24, INC. Revenue (in thousands) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Core Platform Subscription and other platform $ 33,479 $ 37,000 $ 67,539 $ 74,811 Professional services 3,006 3,460 5,761 6,855 Total core platform revenue $ 36,485 $ 40,460 $ 73,300 $ 81,666 Virtual Conference Subscription and other platform $ 668 $ 1,336 $ 1,437 $ 2,889 Professional services 196 290 339 594 Total virtual conference revenue $ 864 $ 1,626 $ 1,776 $ 3,483 Revenue Subscription and other platform $ 34,147 $ 38,336 $ 68,976 $ 77,700 Professional services 3,202 3,750 6,100 7,449 Total revenue $ 37,349 $ 42,086 $ 75,076 $ 85,149 View source version on businesswire.com: https://www.businesswire.com/news/home/20240806665591/en/
Media Contact: Tessa Barron press@on24.com Investor Contact: Lauren Sloane, The Blueshirt Group for ON24 investorrelations@on24.com
