Veritone (VERI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $31.0 million, up 11% year-over-year, driven by software and managed services growth, and supported by the Broadbean acquisition.

• Achieved record AI software pipeline, major wins in public sector and media, including a landmark NCAA contract, and expanded strategic partnerships with AWS and Creative Artists Agency.

• Completed organizational restructuring, reducing workforce by up to 14% and targeting over $13 million in annualized cost savings.

• Formal process underway to divest a non-software asset, with multiple bidders and expected closure in the second half of 2024 to improve liquidity and reduce debt.

• Substantial doubt exists about the ability to continue as a going concern due to debt obligations and recurring losses.

Financial highlights

• Q2 2024 revenue was $31.0 million, up 11% year-over-year; Software Products & Services revenue was $15.6 million (+11% YoY); Managed Services revenue was $15.4 million (+11% YoY).

• Q2 non-GAAP gross profit reached $24.4 million, up 21% year-over-year, with gross margin improving to 78.8%.

• Q2 non-GAAP net loss improved 47% to $6.9 million; loss from operations improved 37% to $17.7 million.

• Cash and cash equivalents at June 30, 2024, were $46.0 million; consolidated debt stood at $166.5 million.

• Stockholders’ equity was $(5.7) million, down from $39.1 million a year earlier.

Outlook and guidance

• Q3 2024 revenue guidance: $34–$35 million; non-GAAP net loss expected between $2.5–$4 million.

• Full-year 2024 revenue guidance: $136–$142 million; non-GAAP net loss expected between $11–$16 million, with potential for non-GAAP cash flow positivity by Q4 2024.

• Public sector expected to grow 40–50% year-over-year in the second half, contingent on closing large deals.

• Managed services, including advertising, projected to improve over 15% year-over-year in the second half.