Summary
nCino reported total revenues of $94.2 million for the first quarter of fiscal 2023, up 51.1% from the prior-year quarter. Gross profit was $53.9 million, up 49.5%. The top line included the first full quarter of SimpleNexus, which nCino acquired at the end of fiscal 2022. Growth came from existing customers expanding their use of the platform and from new customers, including those added through SimpleNexus. GAAP operating loss widened to $27.2 million. GAAP net loss attributable to nCino widened to $30.7 million. GAAP diluted net loss per share widened to $0.28. Gross margin slipped to 57.2%, and operating margin fell to negative 28.9%. Heavy spending on sales, research and development, and general and administrative functions drove the larger losses.
Operating cash flow fell to $1.2 million. Capital expenditures rose to $4.7 million. Deferred revenue, current portion, was $144.0 million as of April 30, 2022. Remaining performance obligations were $905.6 million as of April 30, 2022. On a non-GAAP basis, operating loss was $3.7 million, compared with $4.3 million a year earlier. Non-GAAP net loss attributable to nCino was $6.1 million, compared with $4.0 million. Non-GAAP net loss per share was $0.06, compared with $0.04. Those measures exclude stock-based compensation, amortization of purchased intangibles, acquisition-related expenses, and fees tied to antitrust matters.
Operational momentum showed up in several customer wins. nCino signed a UK-based Big Four financial services provider with over $1 trillion in assets for Commercial Lending and Automated Spreading. It took Hancock Whitney live on Retail Lending, a $36-billion-asset bank, and BOK Financial live on Commercial Lending, a bank with approximately $50 billion in assets. Adoption of nCino IQ expanded across Automated Spreading, Commercial Pricing Profitability, and Portfolio Analytics. The customer count for Automated Spreading is up over 400% from a year ago. SimpleNexus added net new customers at a rate 80% higher than a year ago, including AnnieMac Home Mortgage. The company hosted its annual nSight user conference with nearly 1,400 customers and partners.
Management issued guidance for the second quarter ending July 31, 2022 and for the full fiscal year 2023 ending January 31, 2023. For the second quarter, non-GAAP operating loss is guided to $6.5 million to $7.5 million and non-GAAP net loss per share to $0.08 to $0.09. For the full fiscal year, non-GAAP operating loss is guided to $24 million to $26 million, with non-GAAP net loss per share of $0.28 to $0.30. The company also provided revenue guidance for both the second quarter and the full fiscal year. Management expects to keep incurring operating losses as it scales the business.
Risks remain substantial. The company cited the COVID-19 pandemic, integration of SimpleNexus, security breaches, competition, dependence on Salesforce, customer concentration, system availability, and macroeconomic conditions including the conflict in Ukraine and higher interest rates. The MD&A notes that rising interest rates could affect the digital homeownership platform revenue. Expiration of PPP solution access rights could pressure revenue growth and subscription retention. nCino expects operating losses for the foreseeable future and plans higher capital expenditures for office build-outs. It also faces fees and expenses related to antitrust matters. Sales cycles are long, ranging from six to nine months for smaller financial institutions to 12 to 18 months or more for larger ones, and the company leans on system integrators such as Accenture, Deloitte, PwC, and West Monroe Partners for implementation work at larger customers.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2023 | Q4 FY2022 | QoQ | Q1 FY2022 | YoY |
|---|---|---|---|---|---|
| Revenue | $94.2M | — | — | — | — |
| Gross profit | $53.9M | — | — | — | — |
| Gross margin | 57.2% | — | — | — | — |
| Research & development | $29.1M | — | — | — | — |
| Sales & marketing | $29.3M | — | — | — | — |
| General & administrative | $22.7M | — | — | — | — |
| Total operating expenses | $81.1M | — | — | — | — |
| Operating income (loss) | -$27.2M | — | — | — | — |
| Operating margin | -28.9% | — | — | — | — |
| Net income (loss) | -$30.0M | — | — | — | — |
| Net margin | -31.9% | — | — | — | — |
| Diluted EPS | -$0.28 | — | — | — | — |
Risks
The MD&A states that emergency purchases of the PPP solution may have moderated revenue growth rates in fiscal 2022, and that fiscal 2023 revenue growth rates and subscription revenue retention rates may be adversely affected upon expiration of access and use rights to the PPP solution if those rights are not re-purposed for other applications.
The MD&A states the company expects to continue incurring operating losses for the foreseeable future due to continued investment in product development, sales and marketing, and general and administrative spending. For the quarter ended April 30, 2022, GAAP operating loss widened 76.0% to $27.2 million and net loss attributable to nCino widened 104.5% to $30.7 million compared with the prior-year quarter.
The MD&A highlights that new customer sales cycles are typically lengthy, generally ranging from six to nine months for smaller financial institutions to 12 to 18 months or more for larger financial institutions, and that growth requires convincing key decision makers to replace legacy third-party point solutions or internally developed software.
The MD&A states the company is continuing to operate in a rising interest rate environment. To date, nCino has not suffered a material negative impact from rising interest rates, including with respect to its digital homeownership platform revenue, but it continues to monitor the impact of rising rates on the business.
Beginning with the quarter ended April 30, 2022, the company began following Internal Revenue Code Section 174, which eliminates the option to currently deduct U.S. research and development expenditures and requires capitalization and amortization over five or fifteen years. The MD&A states this could reduce operating cash flows in future periods through cash remittances of U.S. federal and state income tax, and operating cash flow for the quarter was down 83.5% to $1.25 million versus the prior-year quarter.
The MD&A states capital expenditures are expected to be appreciably higher in absolute dollars in fiscal 2023 for planned office build-outs, with approximately $10.1 million remaining to complete at April 30, 2022. For the quarter ended April 30, 2022, capital expenditures were up 799.2% to $4.69 million while operating cash flow was down 83.5% to $1.25 million compared with the prior-year quarter.
The MD&A states that growing the customer base will require increasingly penetrating markets outside the United States, which accounted for 15.2% of total revenues for the quarter ended April 30, 2022, and requires continued investment in the growth and success of the sales force both in the United States and internationally.
The MD&A expects general and administrative expenses to increase in absolute dollars in the near term partly due to fees and expenses related to the Antitrust Matters. Non-GAAP adjustments for the quarter ended April 30, 2022 included $1.7 million of fees and expenses related to the Antitrust Matters.
SaaS KPIs
All quarters →Free Cash Flow
Non-GAAP Gross Margin
Total Remaining Performance Obligation (RPO)
Organic RPO
Summary, forecast, risks and KPIs are extracted from nCino, Inc.'s SEC filings for Q1 FY2023 (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.