Summary
Asana's third quarter of fiscal 2024 showed a business still growing at a double-digit clip while GAAP losses narrowed. Revenue was $166.5 million for the quarter, up 17.7% from the prior-year quarter. Year-to-date revenue reached $481.4 million, up 21.3%. Gross profit was $150.5 million, up 19.1%, and gross margin was 90.4%, up 1.1 percentage points. The company reported a GAAP operating loss of $63.4 million, which narrowed 37.3% from the prior-year quarter, and operating margin was negative 38.1%, up 33.4 percentage points. Net loss narrowed 38.8% to $61.8 million, and diluted EPS loss narrowed 42.9% to negative $0.28. For the first nine months, net loss was $194.6 million and diluted EPS was negative $0.89. The revenue increase came from new paying customers, a shift toward higher priced Enterprise and Business plans, and expansion within existing customers.
Cash generation improved. Operating cash flow was negative $8.2 million for the quarter, an improvement of $37.9 million from the prior-year quarter. Capital expenditures were $1.3 million, down 13.9%. Free cash flow, a non-GAAP measure, was negative $11.5 million. Deferred revenue was $249.7 million, up 17.7%. Remaining performance obligations were $335.1 million. The company ended the quarter with over three million paid seats.
Operational metrics point to a customer base that is still expanding, though at a slower pace than a year ago. The number of Core customers, those spending $5,000 or more on an annualized basis, grew to 21,346, up 14% year over year. Revenues from Core customers grew 20% year over year. Customers spending $100,000 or more on an annualized basis grew to 580, up 18% year over year. Overall dollar-based net retention rate was over 100%. Dollar-based net retention rate for Core customers was over 105%. Dollar-based net retention rate for customers spending $100,000 or more was over 120%. Non-GAAP operating loss was $9.8 million, and non-GAAP net loss was $8.2 million. Non-GAAP net loss per share was $0.04. Asana also unveiled new AI innovations powered by its Work Graph and hosted its inaugural Work Innovation Summit in New York and London.
Guidance for the fourth quarter of fiscal 2024 calls for year over year revenue growth of 11% to 12%. The company expects a non-GAAP operating loss of $23.0 million to $21.0 million and a non-GAAP net loss per share of $0.10 to $0.09, assuming basic and diluted weighted average shares outstanding of approximately 223 million. For the full fiscal year 2024, Asana expects year over year revenue growth of 19%. It expects a non-GAAP operating loss of $66.0 million to $64.0 million and a non-GAAP net loss per share of $0.27 to $0.26, assuming basic and diluted weighted average shares outstanding of approximately 219 million.
Risks remain. Management said current macroeconomic headwinds have impacted customers' renewal decisions and expects that trend to continue into fiscal year 2025. The company also faces risks related to its ability to achieve future growth and sustain its growth rate, attract and retain customers, develop and release new products, scale its platform, integrate artificial intelligence, maintain and grow relationships with strategic partners, and expand internationally. The market is highly competitive and rapidly evolving. Asana completed a reduction of its global workforce by approximately 9% in November 2022 to improve operational efficiencies.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q3 FY2024 | Q2 FY2024 | QoQ | Q3 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $166.5M | $162.5M | +2.5% | $141.4M | +17.7% |
| Gross profit | $150.4M | $146.2M | +2.9% | $126.3M | +19.1% |
| Gross margin | 90.4% | 90.0% | +0.3 pp | 89.3% | +1.1 pp |
| Research & development | $81.0M | $84.4M | -4.0% | $75.5M | +7.3% |
| Sales & marketing | $98.3M | $96.4M | +2.0% | $113.7M | -13.5% |
| General & administrative | $34.5M | $38.8M | -11.1% | $38.2M | -9.6% |
| Total operating expenses | $213.9M | $219.6M | -2.6% | $227.4M | -5.9% |
| Operating income (loss) | -$63.4M | -$73.4M | +13.6% | -$101.1M | +37.3% |
| Operating margin | -38.1% | -45.2% | +7.1 pp | -71.5% | +33.4 pp |
| Net income (loss) | -$61.8M | -$71.4M | +13.5% | -$100.9M | +38.8% |
| Net margin | -37.1% | -44.0% | +6.9 pp | -71.3% | +34.3 pp |
| Diluted EPS | -$0.28 | -$0.33 | +$0.05 | -$0.49 | +$0.21 |
| Customers | 21,346 | 20,782 | +2.7% | — | — |
| Net retention rate | 100.0% | 105.0% | -5.0 pp | 120.0% | -20.0 pp |
Risks
MD&A states global macroeconomic events including elevated inflation, higher interest rates, bank failures, supply chain disruptions, currency fluctuations, the Ukraine conflict, the Israel and Gaza conflict, and residual COVID-19 have adversely affected IT spending, customer buying patterns, and sales cycle length. It expects these conditions to continue to pressure customer renewal decisions into fiscal year 2025.
Dollar-based net retention rate was over 100% as of October 31, 2023 compared with over 120% as of October 31, 2022; Core customers over $5,000 were over 105% compared with over 128%; customers over $100,000 were over 120% compared with over 140%. MD&A attributes pressure to macroeconomic headwinds affecting renewals and expects the trend to continue into fiscal 2025.
The filing repeatedly highlights that advancements in artificial intelligence and machine learning are changing how people work and that competitors may incorporate AI or machine learning to more significantly improve their offerings. Asana states its growth depends on successfully deploying AI features in its product and on avoiding a competitive disadvantage if adoption is slow.
MD&A says macroeconomic conditions have lengthened sales cycles, and risk factors note enterprise sales require greater costs, longer sales cycles, and less predictability, with larger organizations demanding more customization and support. Failure to sell effectively to organizations of all sizes may harm revenue growth.
Substantially all revenues come from a single solution, the Asana work management platform, so reduced demand, slower market adoption, or a decline in work management solution spending would disproportionately affect results.
The November 2022 restructuring reduced global headcount by approximately 9%; the filing says Asana may not realize anticipated savings, may undertake additional workforce reductions, and the reduction may hurt its ability to attract and retain employees.
The November 2022 Senior Secured Credit Facility contains financial covenants including a consolidated adjusted quick ratio of 1.25 to 1.00 and minimum cash adjusted EBITDA tested quarterly. Non-compliance could accelerate repayment and restrict operations.
SaaS KPIs
All quarters →Free cash flow
Non-GAAP operating margin
Non-GAAP gross margin
Customers Spending $100,000+ (annualized)
Non-GAAP Operating Loss
Dollar-Based Net Retention Rate (Core customers)
Dollar-Based Net Retention Rate (Overall)
Total Customers
Summary, forecast, risks and KPIs are extracted from Asana, Inc.'s SEC filings for Q3 FY2024 (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.