Instructure (INST) Q4 2023 earnings summary

Executive summary

• FY23 revenue reached a record $530.2m, up 11.6% YoY; adjusted EBITDA was a record $214.2m, up 19.3%.

• Parchment acquisition expanded platform scale, credentialing capabilities, and access to new buyers.

• Q4 results exceeded the high end of guidance for revenue, adjusted EBITDA, and adjusted unlevered free cash flow.

Financial highlights

• Q4 revenue was $135.4m, up 8.5% YoY; FY revenue was $530.2m, up 11.6%.

• FY GAAP net loss was $34.1m, slightly improved from $34.2m in FY22; Q4 net loss was $5.8m vs. $5.7m.

• FY non-GAAP operating income was $209.8m, up 20.6%; Q4 non-GAAP operating income was $55.4m, up 19.1%.

• FY adjusted EBITDA was $214.2m, up 19.3%; Q4 adjusted EBITDA was $56.5m, up 16.1%.

• FY cash from operations was $164.0m, up 16.9%; adjusted unlevered free cash flow was $225.5m, up 29.9%.

Outlook and guidance

• FY24 revenue guidance is $655.0m–$665.0m; non-GAAP operating income $260.5m–$265.5m; adjusted EBITDA $266.5m–$271.5m.

• FY24 non-GAAP net income guidance is $105.5m–$110.5m; adjusted unlevered free cash flow guidance is $259.5m–$264.5m.

• Q1 2024 guidance: revenue $153.8m–$154.8m; non-GAAP operating income $55.9m–$56.9m; adjusted EBITDA $57.3m–$58.3m; non-GAAP net income $20.0m–$21.0m.

• Guidance assumes prevailing macroeconomic and foreign currency conditions continue through 2024; actual results may differ materially.