Summary
Procore closed fiscal 2022 with fourth quarter revenue of $202.05 million, up 38.3% from the prior-year quarter, and full year revenue of $720.20 million, up 39.9%. Levelset contributed $9 million of revenue in the quarter and $32 million for the year, according to the release. Management highlighted a fifth consecutive quarter of short-term RPO growth above 30%.
Gross margin was roughly stable. The quarter came in at 79.9%, up 0.3 percentage points from a year earlier. The full year was 79.4%, down 1.5 percentage points. GAAP operating loss was $75.20 million in the quarter, widening 1.0% from $74.45 million, and $290.45 million for the year, widening 1.6% from $285.93 million.
Net loss moved differently than operating loss. The fourth quarter net loss was $71.18 million, 39.7% wider than the prior-year quarter. The full year net loss was $286.93 million, 8.2% wider than fiscal 2021. Diluted EPS for the full year was -$2.10, compared with -$2.86, so the loss per share narrowed even as the total net loss grew. Operating margin improved on both a GAAP and a non-GAAP basis. GAAP operating margin was -37.2% for the quarter, up 13.7 percentage points from -51.0%, and -40.3% for the year, up 15.2 percentage points. Non-GAAP operating margin was -8% in the quarter and -10% for the year, and non-GAAP gross margin was 84% for both periods.
Cash flow turned positive in the fourth quarter. Operating cash flow was $22.69 million, versus an outflow of $3.58 million a year earlier. For the full year, operating cash flow was $12.61 million, down 65.7% from $36.73 million. Free cash flow, which Procore reports as a non-GAAP measure, was an inflow of $12 million in the quarter and an outflow of $37 million for the year. Capital expenditures were $2.11 million in the quarter, down 46.9%, and $15.78 million for the year, up 27.4%.
Backlog and customer metrics held up. Deferred revenue was $396.54 million at December 31, 2022, up 31.5%. Total RPO was $797.50 million, up 32.3%, and roughly 70% of that is expected to be recognized as revenue within 12 months. Procore added 402 net new organic customers in the fourth quarter and finished the year with 14,488 organic customers. Gross revenue retention was 95% for 2022. The company ended the year with 3,568 full-time employees, an increase of 24%.
Guidance calls for a slower growth year. For the first quarter of 2023, Procore guides to revenue of $202 million to $204 million, year-over-year growth of 27% to 28%, with a non-GAAP operating margin of -8.5% to -9.5%. For the full year 2023, revenue is expected to be $895 million to $900 million, growth of 24% to 25%, with a non-GAAP operating margin of -6.5% to -7.5%. That full year growth target sits well below the 39.9% the company just posted for fiscal 2022.
Risks center on the macro backdrop and the company's still-negative GAAP results. Management lists rising inflation, rising interest rates, volatility in capital markets and foreign exchange moves as factors that could affect expenses, customer spending and cash flow, while noting they have not had a material impact so far. The materials financing program runs off Procore's own balance sheet, and the company may use up to approximately 10% of its current cash, cash equivalents and marketable securities position to support it. Leadership is also in transition: CFO Paul Lyandres moves to President of Fintech in early May 2023, with SVP of Finance Howard Fu succeeding him, and Sarah Hodges joins as Chief Marketing Officer on February 21, 2023.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2022 | Q3 FY2022 | QoQ | Q4 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $202.1M | $186.4M | +8.4% | $146.1M | +38.3% |
| Gross profit | $161.5M | $148.7M | +8.6% | $116.3M | +38.8% |
| Gross margin | 79.9% | 79.7% | +0.2 pp | 79.6% | +0.3 pp |
| Research & development | $75.4M | $71.5M | +5.5% | $60.7M | +24.3% |
| Sales & marketing | $118.2M | $109.6M | +7.8% | $84.3M | +40.2% |
| General & administrative | $43.1M | $39.4M | +9.5% | $45.8M | -6.0% |
| Total operating expenses | $236.7M | $220.5M | +7.4% | $190.8M | +24.1% |
| Operating income (loss) | -$75.2M | -$71.8M | -4.7% | -$74.5M | -1.0% |
| Operating margin | -37.2% | -38.5% | +1.3 pp | -51.0% | +13.7 pp |
| Net income (loss) | -$71.2M | -$71.2M | +0.0% | -$51.0M | -39.7% |
| Net margin | -35.2% | -38.2% | +3.0 pp | -34.9% | -0.3 pp |
| Diluted EPS | -$0.52 | -$0.52 | ±$0.00 | — | — |
| Customers | 189 | 3,000 | -93.7% | 3,000 | -93.7% |
Risks
PCOR's revenue depends on construction spending and customer annual construction volume, which sets pricing. The filing cites rising inflation, rising interest rates, capital market volatility, supply chain disruptions, labor shortages, and reduced government infrastructure spending as factors that could reduce demand or increase costs.
The Levelset materials financing program exposes PCOR to credit, performance, and liquidity risk because it holds customer receivables on deferred payment terms. As of December 31, 2022, receivables net of expected credit losses were $11.5 million, and PCOR may use up to approximately 10% of its cash, cash equivalents, and marketable securities position to support the program while it seeks a third-party capital provider.
PCOR reported a FY2022 net loss of $286.9 million, an accumulated deficit of $949.1 million as of December 31, 2022, and operating cash flow down 65.7% year to date to $12.6 million. MD&A states it may need additional equity or debt financing, and recent economic volatility and interest rate increases could limit access to capital.
FY2022 revenue was up 39.9% year to date to $720.2 million, but the 10-K states revenue growth rate is expected to decline in the future as the business matures. Failure to accurately forecast growth or manage investments in sales, marketing, and product development could harm results.
The construction management software market is highly competitive, and PCOR sells at a premium to some competitors. Competitors may offer lower-priced or free products, bundle broader offerings, or make acquisitions, and competition may intensify as PCOR enters materials financing.
Larger enterprise and owner customers have long evaluation and negotiation cycles due to size, leverage, and approval requirements, creating higher upfront sales costs and unpredictable timing. Revenue is recognized ratably over subscription terms, so new bookings do not immediately appear in results.
PCOR is highly dependent on founder, President, and CEO Craig F. Courtemanche, Jr., and competition for skilled personnel is significant. Failure to attract, integrate, and retain key employees, particularly in sales and marketing and engineering, could impair strategic objectives.
PCOR had customers in over 150 countries and 14% of FY2022 revenue from outside the U.S. International expansion increases regulatory, tax, employment, and currency risks, and PCOR does not currently hedge non-U.S. dollar currency exposure.
PCOR processes sensitive customer data, including building plans, and is subject to GDPR, UK GDPR, CCPA/CPRA, and other privacy laws. The filing notes proposed EU AI regulation could impose onerous obligations, and cross-border data transfer restrictions could disrupt operations.
Effective December 31, 2022, PCOR is no longer an emerging growth company and can no longer rely on exemptions such as avoiding auditor attestation under Section 404. Increased compliance costs and the risk of material weaknesses in internal control over financial reporting may strain resources.
SaaS KPIs
All quarters →Non-GAAP Gross Margin
Non-GAAP Operating Margin
Total Organic Customers
Net New Organic Customers
Non-GAAP Free Cash Flow
Summary, forecast, risks and KPIs are extracted from PROCORE TECHNOLOGIES, INC.'s SEC filings for Q4 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.