Summary
Five9, a cloud-based contact center software provider, continues to show strong performance with a 27% year-over-year revenue increase, reaching $328.0 million in 2019. This growth was largely driven by larger clients increasing their number of agent seats. The company holds more than 2,000 clients across various industries, with a concentration on larger-scale contact centers. However, they reported a net loss of $4.6 million, reflecting ongoing significant investments in R&D, sales, marketing, and infrastructure to support growth and diversification. Looking ahead, the company anticipates increased expenses as a percentage of revenue due to expanding operations and headcount, yet expects efficiencies and economies of scale to offset this overtime.
The retention of clients remains robust, as demonstrated by the Annual Dollar-Based Retention Rate improving to 105%. This indicates success in retaining customers and expanding the usage of the platform among existing clients despite potential market fluctuations, seasonal trends, and competitive pressures.
Several risks have been emphasized. The variability of quarterly and annual financial results, often outside of the company's control, can affect stock value and obscure the underlying business performance. Managing growth is also a critical focus, with the challenge of expanding and training the direct sales force. The efficiency of this expansion is crucial as it directly impacts client acquisition and revenue generation. On the technical side, any service outages, whether from infrastructure changes or external attacks, threaten customer satisfaction and could lead to claims for damages.
Overall, while Five9 displays a strong growth trajectory and effective client retention strategies, they face multiple external and internal challenges. These include managing rapid growth, maintaining service reliability amidst infrastructure changes, and the ever-evolving competitive landscape, particularly as they expand internationally and handle macroeconomic influences. The commitment to continuous innovation and client base expansion will be central to Five9's sustained success.
Forecast
No forward guidance in this quarter's filings.
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2019 | Q3 FY2019 | QoQ | Q4 FY2018 | YoY |
|---|---|---|---|---|---|
| Revenue | $92.3M | $83.8M | +10.1% | $72.3M | +27.5% |
| Gross profit | $54.3M | $49.3M | +10.2% | $44.0M | +23.5% |
| Gross margin | 58.9% | 58.9% | +0.0 pp | 60.8% | -1.9 pp |
| Research & development | $12.2M | $11.7M | +4.3% | $8.5M | +44.0% |
| Sales & marketing | $25.6M | $25.0M | +2.5% | $18.8M | +36.4% |
| General & administrative | $13.5M | $12.1M | +11.1% | $10.8M | +25.4% |
| Total operating expenses | $51.3M | $48.8M | +5.1% | $38.0M | +34.9% |
| Operating income (loss) | $3.0M | $472.0K | +542.4% | $6.0M | -49.3% |
| Operating margin | 3.3% | 0.6% | +2.7 pp | 8.3% | -5.0 pp |
| Net income (loss) | $836.0K | -$1.6M | +152.1% | $3.7M | -77.6% |
| Net margin | 0.9% | -1.9% | +2.8 pp | 5.2% | -4.3 pp |
Risks
Fluctuations in quarterly and annual results due to market acceptance and client acquisition/renewal rates, among others, may significantly impact financial performance and stock value.
The need to continuously attract new clients and retain existing ones by expanding the direct sales force is critical; any failure here could significantly hamper revenue growth.
Service outages caused by infrastructure changes, human or software errors, or security attacks could result in client dissatisfaction and claims for damages.
SaaS KPIs
All quarters →Annual Dollar-Based Retention Rate
Summary, forecast, risks and KPIs are extracted from Five9, Inc.'s SEC filings for Q4 FY2019 (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 Aug 4, 2026.