Summary
Weave closed FY2021 with fourth-quarter revenue of $31.84 million, up 33.9% from the prior-year quarter. Full-year revenue was $115.87 million, up 45.0% from the prior year. Gross profit was $18.16 million in the quarter, up 31.3%, and $66.50 million for the full year, up 46.3%. Gross margin was 57.0% in the quarter, down 1.1 percentage points from the prior-year quarter, while full-year gross margin was 57.4%, up 0.5 percentage points. The customer base expanded to 23,831 locations under subscription at December 31, 2021, a 29% increase over the 18,539 locations at December 31, 2020. The company reported more than 22,000 customers in the United States and Canada. Dollar-based net retention rate was 103% for 2021, and dollar-based gross retention rate was 94%.
Product and go-to-market efforts widened the platform. Weave launched forms in 2021, added analytics and payments in 2019, and moved beyond dentistry and optometry into verticals such as home services. It introduced multi-office functionality to serve organizations with multiple locations and continues to cross-sell add-ons like Weave Payments. Recurring subscription and payment processing revenue remains the core of the model, while onboarding and hardware carry negative gross profit. Management sees customer retention as a lever for gross margin because onboarding and hardware costs are substantial early in a customer's life.
The bottom line remains deeply negative. Operating loss was $13.64 million in the quarter, and the loss widened from the prior-year quarter. For the full year, operating loss was $50.39 million, and it widened from the prior year. Net loss was $14.07 million in the quarter, and it widened from the prior-year quarter. Full-year net loss was $51.69 million, and it widened from the prior year. Diluted EPS was negative $2.60 in the quarter and negative $2.60 for the full year, and the full-year loss per share narrowed from the prior year. Operating margin was negative 42.8% in the quarter, down 4.6 percentage points, but full-year operating margin was negative 43.5%, up 6.0 percentage points. Expense growth came from headcount, advertising, and public-company costs, with sales and marketing remaining the largest operating expense.
Cash generation weakened. Operating cash flow was negative $10.06 million in the quarter, down from the prior-year quarter. Full-year operating cash flow was negative $20.37 million, down from the prior year. Capital expenditures were $1.65 million in the quarter, up 1.5% from the prior-year quarter, and $7.38 million for the full year, up 167.3%. Deferred revenue was $29.51 million at quarter end, up 29.1% from the prior-year quarter. Remaining performance obligations were $2.20 million. The MD&A states that deferred revenue will be recognized as revenue when all revenue recognition criteria are met. The company also reported free cash flow of negative $30.2 million for 2021, compared with negative $19.4 million for 2020, and Adjusted EBITDA of negative $33.3 million for 2021, compared with negative $25.6 million for 2020.
Management offered limited formal guidance. It expects sales and marketing expenses to be relatively consistent in 2022 as compared to 2021, then decrease as a percentage of revenue over time. Research and development and general and administrative expenses are expected to increase in absolute dollars but decrease as a percentage of revenue over time. The company expects operating cash flows to improve as operational efficiency and economies of scale increase, and it believes current cash, cash equivalents, marketable securities, and availability under its senior secured term loan facility will meet working capital and capital expenditure needs for at least the next 12 months. Risks include the COVID-19 pandemic, especially the Omicron variant and future variants, which could reduce customer demand and delay sales and implementation cycles. COVID-19-related cancellation or postponement of trade shows and conferences has hurt lead generation, though the company has shifted toward inbound and outbound channels. Other risks are the ability to attract new customers, retain and expand within the existing base, add new products, and expand into new verticals such as home services. The amended Silicon Valley Bank credit facility includes financial covenants tied to liquidity and EBITDA.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2021 | Q3 FY2021 | QoQ | Q4 FY2020 | YoY |
|---|---|---|---|---|---|
| Revenue | $31.8M | $30.3M | +5.1% | — | — |
| Gross profit | $18.2M | $17.4M | +4.2% | — | — |
| Gross margin | 57.0% | 57.5% | -0.5 pp | — | — |
| Research & development | $7.1M | $6.2M | +14.7% | — | — |
| Sales & marketing | $15.8M | $16.0M | -1.6% | — | — |
| General & administrative | $8.9M | $9.1M | -2.3% | — | — |
| Total operating expenses | $31.8M | $31.3M | +1.4% | — | — |
| Operating income (loss) | -$13.6M | -$13.9M | +2.0% | — | — |
| Operating margin | -42.8% | -45.9% | +3.1 pp | — | — |
| Net income (loss) | -$14.1M | -$14.2M | +1.1% | — | — |
| Net margin | -44.2% | -46.9% | +2.8 pp | — | — |
| Diluted EPS | -$0.69 | -$1.03 | +$0.34 | — | — |
| Customers | 22,000 | — | — | — | — |
| Net retention rate | 104.0% | 104.0% | ±0.0 pp | — | — |
Risks
The Omicron variant caused unexpected challenges with sales and installation activities beginning in December 2021, and COVID-19 continues to disproportionately affect SMB customers. Delayed sales and implementation cycles, plus monthly subscriptions that can be terminated on short notice, could slow revenue growth.
The vast majority of revenue comes from small businesses, which have higher failure rates and more limited financial resources than enterprises. This makes Weave more susceptible to economic downturns and SMB churn.
A majority of customers pay monthly and have no contractual obligation to renew after their term expires; they can terminate on short notice. Dollar-based gross retention rate was 94% for FY2021, and customer turnover has historically been driven in part by SMB churn.
The market is intensely competitive and fragmented, with larger competitors that have greater resources and can bundle competing products at lower prices. If Weave cannot maintain pricing, margins may be reduced and revenue growth could slow.
Weave relies on single-source suppliers including Yealink for phones, Stripe for point-of-sale devices and payment processing for Weave Payments, and Bandwidth and Telnyx for texting. Stripe is integral to Weave Payments, and past limited processing interruptions have temporarily prevented some customers from collecting payments.
The company experienced high employee turnover, particularly in customer service and sales organizations in 2021. Over half of current customer service and support staff have been employed less than one year, contributing to increased hold times and customer dissatisfaction.
Dentrix provides critical functionality for a significant portion of the customer base under a contract running through July 2026, and QuickBooks supports home-services expansion. If these partners amend, terminate, or prioritize competing offerings, the value of Weave's platform could decline.
Weave depends on network service providers and internet service providers, many without long-term committed contracts, and has experienced higher fees associated with text messaging. Fee changes can occur daily or weekly while customer pricing does not change as rapidly.
Weak economic conditions, supply chain shortages, inflation, and geopolitical developments such as the Russia-Ukraine conflict could reduce SMB demand and make it harder to collect accounts receivable. Revenue is dependent on customer usage, which is influenced by the scale of business customers conduct.
Operating cash flow was negative $20.4 million for the year ended December 31, 2021, down from negative $15.5 million for the year ended December 31, 2020, and net loss widened to $51.7 million from $40.4 million. The company may need additional capital to support growth.
SaaS KPIs
All quarters →Free cash flow
Free cash flow margin
Adjusted EBITDA
Net Revenue Retention
Dollar-Based Gross Retention Rate
Number of locations (at period end)
Summary, forecast, risks and KPIs are extracted from Weave Communications, Inc.'s SEC filings for Q4 FY2021 (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 6, 2026.