Summary
Asana reported FY2022 second quarter revenue of $89.5 million, up 72.0% from $52.0 million in the prior-year quarter. Gross profit rose 76.9% to $79.6 million, and gross margin reached 89.0%, up 2.5 percentage points from 86.5%. Revenue for the six months ended July 31, 2021 was $166.2 million, up 66.6% from $99.7 million a year earlier. Management credited new paying customers, a sales mix shifting toward larger contracts, and expansion inside existing accounts. The dollar-based net retention rate stayed above 118%.
The operating line moved the other way. GAAP operating loss was $60.1 million, wider than the $33.6 million loss a year earlier. Operating margin slipped to negative 67.1% from negative 64.6%. Net loss was $68.4 million versus $41.1 million, while diluted loss per share narrowed to $0.40 from $0.54. Spending drove the gap. Research and development expenses climbed 87% year over year, sales and marketing 65%, and general and administrative 98%. On a non-GAAP basis the operating loss was $38.6 million, or 43% of revenue, against $27.2 million, or 52% of revenue, a year earlier, and non-GAAP net loss per share was $0.23, compared with $0.34.
Customer counts kept climbing. The quarter ended with more than 107,000 paying customers, up from more than 82,000 a year earlier. Customers spending $5,000 or more on an annualized basis grew to 12,806, an increase of 61%, and revenue from that group rose 97% year over year. Accounts spending $50,000 or more reached 598, up 111%. The reported dollar-based net retention rate was over 118%, with over 125% for the $5,000-plus group and over 145% for the $50,000-plus group. Product work included video messaging, intelligent prioritization, a smart calendar assistant, a new desktop app, an Asana app for Zoom, and three added languages, bringing the platform to 13.
Cash trends improved even as reported losses widened. Operating cash flow was negative $8.5 million for the quarter, compared with negative $22.1 million a year earlier. For the six months it was negative $16.0 million, against negative $40.3 million. Capital expenditures were $12.6 million in the quarter and $29.6 million year to date, tied to the build-out of the San Francisco headquarters. Free cash flow, a non-GAAP measure, was negative $9.3 million, better than the negative $21.9 million reported in the prior-year quarter. Deferred revenue was $139.6 million at July 31, 2021, and it remains a funding source for the business because billed subscriptions are collected before they are recognized.
Guidance for the third quarter of fiscal 2022 calls for a non-GAAP operating loss of $49 million to $47 million and a non-GAAP net loss per share of $0.27 to $0.26 on roughly 184 million basic and diluted shares. For the full fiscal year 2022, management raised its revenue outlook. The company still expects research and development and sales and marketing expenses to grow in dollar terms while shrinking as a percentage of revenue over time. Non-GAAP measures carry real weight in this story, and stock-based compensation remains a large recurring expense that those measures exclude.
Risk stays elevated. Asana called the COVID-19 pandemic an ongoing threat that could weaken global IT spending, lengthen sales cycles, shorten subscription terms, hurt collections, push some paying customers out of business, and lift attrition. Competition in a fast-moving market, the ability to sustain the growth rate, reliance on a self-service model, partner relationships, and international expansion all sit on the risk list. The company also reported no material changes in contractual obligations and commitments during the six months other than amendments to the headquarters lease.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2022 | Q1 FY2022 | QoQ | Q2 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $89.5M | $76.7M | +16.7% | — | — |
| Gross profit | $79.6M | $68.8M | +15.8% | — | — |
| Gross margin | 89.0% | 89.7% | -0.7 pp | — | — |
| Research & development | $48.5M | $40.0M | +21.2% | — | — |
| Sales & marketing | $63.9M | $56.8M | +12.6% | — | — |
| General & administrative | $27.3M | $22.0M | +24.0% | — | — |
| Total operating expenses | $139.7M | $118.7M | +17.6% | — | — |
| Operating income (loss) | -$60.1M | -$50.0M | -20.1% | — | — |
| Operating margin | -67.1% | -65.2% | -1.9 pp | — | — |
| Net income (loss) | -$68.4M | -$60.7M | -12.7% | — | — |
| Net margin | -76.4% | -79.1% | +2.7 pp | — | — |
| Diluted EPS | -$0.40 | -$0.37 | -$0.03 | — | — |
| Net retention rate | 118.0% | 115.0% | +3.0 pp | — | — |
Risks
The company has incurred net losses in each fiscal year since founding. Net loss widened to $68.36 million in FY2022 Q2 from $41.07 million in FY2021 Q2, and YTD net loss widened to $129.01 million from $76.91 million. Operating loss also widened to $60.05 million for the quarter and $110.03 million YTD, and MD&A says it expects to continue making substantial investments and may operate at a loss in the near and medium term.
Risk Factors state that although the company has experienced rapid growth, it expects its revenue growth rate to decline in future periods. Revenue rose 72.0% in FY2022 Q2 and 66.6% YTD, but the filing says recent growth rates may not be indicative of future growth, and growth depends on attracting new customers and expanding within organizations.
COVID-19 has adversely affected the global economy and could reduce global IT spending, lengthen sales cycles, reduce subscription value, and hurt collections. MD&A notes the pandemic disproportionately impacted smaller businesses and that the overall dollar-based net retention rate declined early in the pandemic but increased for the three months ended July 31, 2021.
Risk Factors describe the work management market as increasingly competitive, fragmented, and with relatively low barriers to entry, and competitors may offer lower prices or price concessions during COVID-19. Many competitors have longer operating histories and greater resources.
Risk Factors highlight the loss of key personnel, particularly co-founder, President, CEO, and Chair Dustin Moskovitz, and note the company has no key person insurance. Competition for executive, engineering, and sales personnel in the San Francisco Bay Area is intense.
As the company focuses on larger organizations, sales efforts require greater costs, longer sales cycles, and less predictability. MD&A says revenue growth reflected a continued shift toward larger customer contracts.
The ability to expand usage and achieve broader market acceptance depends on expanding the direct sales force. Failure to hire, train, or retain direct sales personnel could harm revenue growth. MD&A says sales and marketing remains the largest operating expense in dollar amount and is expected to increase.
The platform relies on AWS for cloud computing infrastructure under a long-term commitment. Disruption, limitation of access, pricing increases, or termination by AWS could harm operations and customer satisfaction.
Dustin Moskovitz is the largest stockholder and holds a majority of voting power as of July 31, 2021. On July 1, 2021, conversion of the Convertible Notes into 17,012,822 Class B shares increased his voting power, and the dual-class structure limits other stockholders' influence.
The July 1, 2021 conversion of the Convertible Notes issued 17,012,822 Class B shares. Future stock issuances, option exercises, and RSU settlements could cause substantial dilution and lower the trading price.
For the six months ended July 31, 2021, 43% of revenues were generated outside the United States. International operations expose the company to data privacy laws, foreign currency declines, longer sales cycles, and regulatory complexity.
SaaS KPIs
All quarters →Free cash flow
Non-GAAP operating margin
Net Revenue Retention
Non-GAAP gross margin
Paying Customers
Summary, forecast, risks and KPIs are extracted from Asana, Inc.'s SEC filings for Q2 FY2022 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.