Release Date: August 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Expensify Inc (EXFY, Financial) reported a 14% quarter-over-quarter increase and a 48% year-over-year increase in interchange revenue, reaching $4 million.
- The company achieved a 10% quarter-over-quarter increase in free cash flow, amounting to $5.7 million.
- Expensify Inc (EXFY) increased its annual free cash flow guidance to $15 million to $16 million, reflecting effective cost-cutting measures.
- The company's SEO keywords increased by 122% year-over-year, enhancing its online visibility and marketing effectiveness.
- Expensify Inc (EXFY) announced a high-profile partnership with Apple for an upcoming film, generating significant media coverage and estimated earned media value of over $100 million.
Negative Points
- Revenue and average paid members remained flat quarter-over-quarter, indicating a potential stagnation in growth.
- The company reported a net loss of $2.8 million for the quarter.
- Expensify Inc (EXFY) is still in the process of transitioning members to a new card program, which may cause temporary disruptions.
- The company has not provided specific revenue guidance for New Expensify, indicating uncertainty in its financial impact.
- There are restrictions on share repurchases due to covenants with lenders, limiting the company's ability to buy back shares.
Q & A Highlights
Q: Can you comment on the dynamics seen in July related to the uptick in customer numbers, typically a slow month?
A: Ryan Schaffer, CFO: It's not due to one specific factor but rather the sum of many small changes. We've been making incremental improvements, and while we can't guarantee no future decreases, we're encouraged by the leveling off seen in July. David Barrett, CEO: We've also been actively engaging with users and received significant buzz from the Apple movie partnership.
Q: When will the expense related to the Apple movie sponsorship appear in the P&L?
A: Ryan Schaffer, CFO: The expense will be recognized when the movie is released, which is expected in June of next year.
Q: With the transition out of R&D mode, when will we see optimization of R&D expenses?
A: David Barrett, CEO: The shift is more about optimizing the sales process rather than reducing R&D expenses. Ryan Schaffer, CFO: Post-launch work is considered a cost of revenue, but internally, we still view it as product development.
Q: Can you provide an estimate for revenue from New Expensify in Q3?
A: Ryan Schaffer, CFO: It's too early to provide a specific revenue number, but it will be more than zero, albeit less than $1 million. We aim to provide more guidance as the business stabilizes.
Q: Regarding the New Expensify Card program, why does the revenue from the new program seem less than expected?
A: Ryan Schaffer, CFO: The 34% spend migration was achieved by the end of Q2, but much of it occurred in the last 25 days of the quarter, affecting the revenue proportion. It's primarily a timing issue.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
