Strong Revenue Growth and Significantly Improved Gross Margins Highlight Third Quarter
GAINESVILLE, FL – November 8, 2017 – SharpSpring, Inc. (NASDAQ: SHSP), a global provider of cloud-based marketing technologies, reported financial results for the third quarter ended September 30, 2017.
Third Quarter 2017 Financial Results from Continuing Operations
- Flagship SharpSpring product revenues grew 29% from $2.5 million in Q3 last year to $3.2 million this year, and was 95% of total revenues in the quarter.
- Overall revenue increased 13% to $3.4 million from $3.0 million in the same year-ago period, which includes legacy products.
- Gross profit increased to 65% of revenue, or $2.2 million, in the third quarter of 2017 from 58% of revenue, or $1.7 million, in the third quarter of 2016.
- Net loss from continuing operations totaled $1.7 million, or $0.20 per share, compared to a net loss from continuing operations of $1.2 million, or $0.15 per share, in the third quarter of 2016.
- Adjusted EBITDA loss (a non-GAAP metric reconciled below) totaled $1.3 million, compared to an adjusted EBITDA loss of $1.0 million in the same year-ago period.
- Core net loss from continuing operations (a non-GAAP metric reconciled below) totaled $1.3 million, or $0.16 per share, compared to core net loss from continuing operations of $693,000, or $0.08 per share, in the same year-ago period.
- At quarter-end, the company had $6.3 million in cash and no debt.
Third Quarter 2017 Operational Highlights
- Added a record 258 new SharpSpring customers, up 24% from the prior quarter, and finished the quarter with 1,327 agency customers and over 6,400 businesses using the flagship platform.
- Expanded integration with PieSync, further extending the SharpSpring platform by providing users with native in-app two-way contact syncing with more than 80 cloud-based platforms.
- Launched a new visual workflow builder to enhance the SharpSpring solution by simplifying the creation of complex automation tasks and allowing marketers to visualize the process as their campaigns are created.
“The third quarter represented a significant return to growth in new customer wins with the best sales quarter in SharpSpring’s history,” said company CEO Rick Carlson. “After adding a record 258 new customers in Q3, we now have more than 1,327 agency partners and over 6,400 businesses using our platform.
“As expected, we are now seeing the positive effects of our increased sales and marketing initiatives and are reaping the benefits from the strengthening customer pipeline that we built up in the first half of the year. We are working to continually refine and improve those strategies to attract and win new customers in a more efficient and profitable manner. Looking ahead, SharpSpring is increasingly well positioned to benefit from the growing adoption of marketing automation solutions. As we continue to execute on our long-term growth plan, we believe we have the right foundation in place to capitalize on our pipeline and leverage our infrastructure as we grow.”
SharpSpring management will hold a conference call today (November 8, 2017) at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results.
Company CEO Rick Carlson and CFO Edward Lawton will host the call, followed by a question and answer period.
U.S. dial-in number: 877-451-6152
International number: 201-389-0879
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 949-574-3860.
A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through November 29, 2017.
Toll-free replay number: 844-512-2921
International replay number: 412-317-6671
Replay ID: 13671804
About SharpSpring, Inc.
SharpSpring, Inc. (NASDAQ: SHSP) is a rapidly growing, highly-rated global provider of affordable marketing automation delivered via a cloud-based Software-as-a Service (SaaS) platform. Thousands of businesses around the world rely on SharpSpring to generate leads, improve conversions to sales, and drive higher returns on marketing investments. Known for its innovation, open architecture and free customer support, SharpSpring offers flexible monthly contracts at a fraction of the price of competitors making it an easy choice for growing businesses and digital marketing agencies. Learn more at www.sharpspring.com.
Non-GAAP Financial Measures
Adjusted EBITDA, core net loss and core net loss per share are “non-GAAP financial measures” presented as supplemental measures of the company’s performance. These metrics are not presented in accordance with United States generally accepted accounting principles, or GAAP. The company believes these measures provide additional meaningful information in evaluating its performance over time. However, the measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of the company’s results as reported under GAAP. A reconciliation of net loss to these measures is included for your reference in the financial section of this earnings press release.
Important Cautions Regarding Forward-Looking Statements
The information posted in this release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these statements by use of the words “may,” “will,” “should,” “plans,” “explores,” “expects,” “anticipates,” “continues,” “estimates,” “projects,” “intends,” and similar expressions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. These risks and uncertainties include, but are not limited to, general economic and business conditions, effects of continued geopolitical unrest and regional conflicts, competition, changes in technology and methods of marketing, delays in completing new customer offerings, changes in customer order patterns, changes in customer offering mix, continued success in technological advances and delivering technological innovations, our ability to successfully utilize our cash to develop current and future products, delays due to issues with outsourced service providers, those events and factors described by us in Item 1. A “Risk Factors” in our most recent Form 10-K and other risks to which our Company is subject, and various other factors beyond the Company’s control. Except to the extent required by law, the Company undertakes no obligation to update or revise (publicly or otherwise) any forward-looking statements to reflect subsequent events, new information or future circumstances.