Enfusion (ENFN) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $49.5M, up 16% year-over-year, with adjusted EBITDA margin expansion and net income of $2.5M.

• 39 new clients signed in Q2, bringing total to 879, with major wins in insurance, banking, and asset management across EMEA, APAC, and the Americas.

• Recurring subscription-based revenues comprised 99.1% of total revenues in Q2 2024.

• Product innovation included enhancements to Portfolio Workbench and Cash Ladder, supporting deeper penetration into institutional segments.

• Continued investment in technology and upmarket strategy is driving higher contract values and longer durations.

Financial highlights

• Q2 2024 revenue: $49.5M, up 16% year-over-year; adjusted EBITDA: $10.1M (20.5% margin); net income: $2.5M; adjusted net income: $6.6M; adjusted EPS: $0.05.

• Gross profit: $33.5M (67.7% margin); adjusted gross profit: $33.9M (68.5% margin).

• ARR at quarter-end was $195.7M, up 14% year-over-year and 3% sequentially.

• Operating cash flow: $7.3M (14.8% margin); adjusted free cash flow: $4.6M (45.5% FCF conversion).

• Cash and cash equivalents as of June 30, 2024: $34.4M; no debt; $100M revolver capacity available.

Outlook and guidance

• Reiterated 2024 full-year guidance: revenue of $200M–$210M, adjusted EBITDA of $40M–$45M, and free cash conversion of 50%–55%.

• Medium-term (2025–2027) targets: 20–22% annual revenue growth, 200–400 bps adjusted EBITDA margin expansion, 300–500 bps FCF conversion expansion.

• Stock-based compensation expected at $19M–$20M for the year.

• NDR target of 106%–107% may be delayed into early 2025 due to tempered upsell environment.

• Current liquidity and available credit are expected to be sufficient for at least the next 12 months.