ChannelAdvisor Reports Q1 2022 Earnings With Quarterly Revenues of $42.3 Million

ChannelAdvisor announced financial results for its first quarter ended March 31, 2022, reporting total revenue of $42.3 million which was at the high end of its guidance range.

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ChannelAdvisor First Quarter 2022 Highlights

GAAP

• Total revenue of $42.3 million.
• Subscription revenue increased 17% year-over-year.
• Brands revenue increased 32% year-over-year.
• Brands subscription revenue growth of 36% year-over-year and represented a record 49% of total subscription revenue.
• Cash and cash equivalents were $106.9 million, an increase of $24.5 million since March 31, 2021 and an increase of $6.3 million since December 31, 2021.

Non-GAAP

• Adjusted EBITDA of $8.2 million and adjusted EBITDA margin of 19% exceeded the high-end of the guidance range.
• Free cash flow for the three months ended March 31, 2022 of $6.0 million, or $0.19 per diluted share based on 31.7 million diluted weighted average shares outstanding.

“We once again delivered strong financial results in Q1, with revenue that reached the high-end of our guidance range and adjusted EBITDA that exceeded the high-end of our guidance range Subscription revenue performed particularly well, increasing 17% year-over-year. This is a direct result of our brands-focused strategy coupled with solid execution, despite slowing e-commerce growth and a more challenging macro environment as we emerge from COVID. With over $100 million of cash, no debt, market leadership and a large opportunity in front of us, we remain excited about what the future holds for ChannelAdvisor.”

David Spitz, ChannelAdvisor’s chief executive officer

Recent Business Highlights

Continued product innovation: ChannelAdvisor’s strategy is to go deep on key channels and enable clients to leverage native capabilities such as fulfillment and advertising.

With the latest product release, ChannelAdvisor expands fulfillment support by providing sellers the ability to manage and automate their fulfillment operations across additional channels, including Bol.com and Wayfair.

With these additional fulfillment integrations, sellers can deliver the best “on channel” consumer experience while maintaining flexibility over fulfillment options based on product selection and inventory availability.

On the advertising front, ChannelAdvisor recently established an API partnership with Criteo to expand retail media advertising opportunities for customers.

These capabilities should be available mid-year. ChannelAdvisor also released Managed Services for Advertising on TikTok. TikTok is increasingly used by brands and retailers to reach new audiences.

Continued channel expansion: ChannelAdvisor continues to reinforce its commitment to channel diversification to help brands and retailers reach more consumers worldwide.

Adding 21 new integrations, ChannelAdvisor now supports over 340 channels. New channels added include Walmart Mexico, Spartoo in 17 new European locales, Linio in Mexico and Chile, and another 5 locales for AliExpress.

The company also added two new first-party integrations with Douglas in Germany and Austria.

ChannelAdvisor also made it easier for brands to automate the creation of high-quality product content by adding support for Amazon Vendor Content in 12 new locales, bringing the total to 19 third-party and 21 first-party locales.

Industry leadership: Achieved Premier Partner status in the Google Partners program again in 2022, joining a prestigious list that showcases the top 3% of Google Partners in the US.

As a Premier Partner, ChannelAdvisor has access to the training and insights needed to help brands and retailers drive long-term growth and stay ahead of the fast-changing eCommerce landscape.

New customers: ChannelAdvisor recently added notable new customers Perry Ellis, Interparfums and Ste. Michelle Wine, and strategic partner Saks.

In terms of growing our business with existing customers, our account managers collaborated with our sales team to sign expansions with customers like Lacoste, Epson and Wolverine Worldwide.

Financial Outlook

For the second quarter of 2022, ChannelAdvisor currently expects:

• Total revenue between $42.5 and $43 million.
• Adjusted EBITDA between $7.2 and $7.6 million.

For the full year 2022, ChannelAdvisor currently expects:

• Total revenue between $177.0 and $180.0 million.
• Adjusted EBITDA between $37.0 and $39.0 million.

For full details on ChannelAdvisor’s first-quarter earnings report, please visit the ChannelAdvisor investor relations site here.