Summary
Yext opened fiscal 2021 with revenue of $85.35 million in the quarter ended April 30, 2020, up 24.2% from $68.71 million a year earlier. Gross profit rose to $64.17 million, up 22.8%. Gross margin eased to 75.2% from 76.0% in the prior-year quarter. New customers and expanded subscriptions at existing accounts drove the increase. Revenue from enterprise and mid-size customers, a group that includes third-party resellers, grew 26% from $65.4 million to $82.6 million. Customer count rose 36% year over year to nearly 2,100, a figure that excludes small business and reseller customers. Structured facts in the Knowledge Graph grew 43% to more than 295 million.
Costs grew faster than sales. The operating loss widened to $29.19 million from $19.26 million a year earlier, and operating margin was negative 34.2%, compared with negative 28.0%. The net loss widened to $29.22 million from $18.96 million. Net loss per share was $0.25. Sales and marketing expense rose 26%, research and development rose 45%, and general and administrative expense rose 35%. Two items did most of the damage: employee-related costs from higher headcount, and lease costs tied to the New York headquarters arrangement that began in May 2019. Stock-based compensation reached $17.4 million. Roughly $2.0 million of savings came from reduced travel and canceled conferences and events during the pandemic. Non-GAAP net loss was $11.9 million, compared with $5.7 million a year earlier, and non-GAAP net loss per share was $0.10.
Cash flow turned negative on the operating line. Net cash used in operating activities was $0.66 million, compared with $0.82 million provided in the prior-year quarter. Capital expenditures rose to $21.28 million from $0.83 million, and build-out of new office space, mainly the New York headquarters, accounted for nearly all of it. Deferred revenue, current portion only, was $152.56 million, up 21.7% from $125.37 million. Remaining performance obligations reached $293.80 million, up 14.6%, and $277.8 million of that is expected to be recognized over the next 24 months. Cash and cash equivalents stood at $248.8 million on April 30, 2020. In March 2020 the company replaced its prior credit agreement with a $50.0 million revolving facility, which had $30.4 million available as of April 30, 2020, with $19.6 million in letters of credit pledged as security for office space.
Guidance covers the second fiscal quarter only. Revenue for the quarter ending July 31, 2020 is projected at $84 million to $86 million. Non-GAAP net loss per share is projected at $0.13 to $0.11, assuming 118.5 million weighted-average basic shares. Management withdrew its previously issued full-year fiscal 2021 guidance, citing uncertainty around the COVID-19 pandemic.
The product push centers on Yext Answers. Yext joined the Adobe Exchange program at its premier level, put Answers on a 90-day free trial, and launched the No Wrong Answers marketing campaign. It also built pandemic information hubs with the World Health Organization, the U.S. Department of State, and the states of New Jersey and Alabama. Those deals matter because the customer base leans toward industries the pandemic has hit hard. Management warned that customers in retail and food services may cut or delay technology spending, seek contract concessions, ask for longer billing and payment terms, or shorten contract duration. Revenue is recognized ratably over contract terms, so weaker contracting activity may not show up in reported results until future periods. Sales efforts face the same disruption, with offices closed, travel restricted, and in-person events canceled, including ONWARD20, which had been scheduled for November 2020 in New York City.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2021 | Q4 FY2020 | QoQ | Q1 FY2020 | YoY |
|---|---|---|---|---|---|
| Revenue | $85.4M | $81.4M | +4.9% | $68.7M | +24.2% |
| Gross profit | $64.2M | $60.5M | +6.1% | $52.2M | +22.8% |
| Gross margin | 75.2% | 74.3% | +0.9 pp | 76.0% | -0.8 pp |
| Research & development | $14.4M | $13.8M | +3.9% | $9.9M | +45.1% |
| Sales & marketing | $58.5M | $57.3M | +2.1% | $46.4M | +26.1% |
| General & administrative | $20.5M | $19.8M | +3.1% | $15.2M | +34.7% |
| Total operating expenses | $93.4M | $91.0M | +2.6% | $71.5M | +30.6% |
| Operating income (loss) | -$29.2M | -$30.6M | +4.5% | -$19.3M | -51.6% |
| Operating margin | -34.2% | -37.6% | +3.4 pp | -28.0% | -6.2 pp |
| Net income (loss) | -$29.2M | -$30.6M | +4.4% | -$19.0M | -54.1% |
| Net margin | -34.2% | -37.6% | +3.3 pp | -27.6% | -6.7 pp |
Risks
The COVID-19 pandemic has disrupted operations, closed all global offices, required all employees to work from home, and canceled in-person marketing events including ONWARD20. Customers in industries such as retail and food services may reduce or delay technology spending, renegotiate contracts, request extended billing and payment terms, or shorten contract durations, which may not be fully reflected in operating results until future periods.
The COVID-19 pandemic has made sales cycles more complex and disrupted customer operations, and existing and potential customers may elect not to renew or may reduce subscriptions. Because revenue is recognized ratably over subscription terms, the effect of reduced renewals or new business may not be fully apparent in results until future periods.
As of January 31, 2020, management identified a material weakness in internal control over financial reporting associated with processes to calculate, record and account for sales commissions, including controls reliant on outsourced IT service providers. The company cannot estimate how long remediation will take, and failure to remediate could affect reliability of financial reporting and investor confidence.
Revenue growth rates were 37% for the fiscal year ended January 31, 2018, 34% for the fiscal year ended January 31, 2019, and 31% for the fiscal year ended January 31, 2020, and the company states historical rates are not indicative of future growth. Current quarter revenue was up 24.2% year over year, but the company warns it may not maintain similar growth rates.
A significant portion of revenue is dependent on third-party reseller customers, and top five customers accounted for approximately 11% of revenue for the fiscal year ended January 31, 2020. Resellers may not renew, may purchase fewer licenses, or may seek concessions, and small and midsized reseller customers may be especially susceptible to liquidity and expense limitations from COVID-19.
The market is competitive and rapidly evolving, and the October 2019 launch of Answers, a site search product, places Yext in competition with other search products and larger competitors. Some competitors offer lower-priced products, and failure to achieve target pricing levels could negatively affect margins and operating results.
The March 2020 Credit Agreement provides a $50.0 million senior secured revolving facility but contains restrictive covenants, is secured by substantially all assets, and requires compliance with financial covenants. Loans bear interest based on LIBOR or a base rate, and uncertainty about LIBOR's continuation after 2021 could increase interest costs or affect access to capital.
Capital expenditures were $21.3 million for the quarter ended April 30, 2020, primarily for new office spaces including the new corporate headquarters in New York, up from $0.8 million in the prior-year quarter. The company expects investments in new office space to continue driving cash used in investing activities for the fiscal year ending January 31, 2021.
The company is subject to evolving privacy and data protection laws including CCPA, GDPR, and cross-border transfer mechanisms such as Privacy Shield, and Brexit creates uncertainty. Compliance costs have increased and sales cycles have lengthened as customers conduct additional diligence and negotiate contractual obligations.
SaaS KPIs
All quarters →Customer Count
Remaining Performance Obligations (RPO)
Unearned Revenue
Structured facts in Yext Knowledge Graph
Summary, forecast, risks and KPIs are extracted from Yext, Inc.'s SEC filings for Q1 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.