Pros (PRO) Q4 2023 earnings summary

Executive summary

• FY2023 revenue was $303.7M, up 10% YoY; subscription revenue was $234.0M, up 15%.

• FY2023 free cash flow was $11.4M, improving $33.1M YoY; operating cash flow was $9.9M, improving $33.8M.

• Q4 revenue was $77.5M, up 9% YoY; adjusted EBITDA was $2.5M.

Financial highlights

• FY2023 subscription and maintenance revenue was $254.0M, up 9%; total revenue was $303.7M versus $276.1M.

• FY GAAP operating loss narrowed to $50.6M from $78.1M; net loss narrowed to $56.4M from $82.2M; diluted EPS improved to $(1.22) from $(1.82).

• FY non-GAAP operating income was $1.5M, net income $2.2M, EPS $0.05, and adjusted EBITDA $6.0M; FY2022 non-GAAP EPS was a $0.40 loss.

• Q4 GAAP gross profit was $48.7M, up 12%; operating loss was $10.6M versus $14.9M, net loss $10.2M versus $17.3M, and EPS $(0.22) versus $(0.38).

• Q4 operating cash flow was $13.8M versus cash used of $2.0M; free cash flow was $13.6M versus $1.1M.

Outlook and guidance

• FY2024 guidance: revenue $332M–$334M, subscription revenue $263M–$265M, subscription ARR $289M–$292M, adjusted EBITDA $16M–$19M, and free cash flow $22M–$26M.

• Q1 2024 guidance: revenue $79M–$80M, subscription revenue $63M–$63.5M, non-GAAP EPS $0.00–$0.02, and adjusted EBITDA $0.7M–$1.7M.

• Guidance assumes 48.1M diluted weighted-average shares and a 22% estimated non-GAAP tax rate for Q1 and FY2024.

• 2026 targets are 16%–21% total revenue growth and 19%–24% free cash flow margin, contingent on consistent macroeconomic conditions.