Smartsheet reports earnings beat, acquires digital asset management platform Outfit

Work management platform provider Smartsheet Inc. today delivered an earning beat in its latest quarterly earnings report today and also announced that it has acquired digital asset management platform startup Outfit Inc.

For its second quarter ended July 31, Smartsheet reported a loss before costs such as stock compensation of $13.5 million, or 10 cents per share, more than double its loss of $5.8 million, or five cents per share, a year ago. Revenue came rose 42%, to $186.7 million. Analysts had expected an adjusted loss of 20 cents per share on revenue of $180.4 million.

Free cash flow in the quarter was $7.1 million, and the company’s dollar-based net retention rate was 131%. Calculated billings rose 44% from a year ago, to $205.6 million. Average annualized contract values ended the quarter at $7,557, up 28%.

“Our strong quarterly results demonstrate the value customers are seeing from our core platform and premium capabilities,” Mark Mader, president and chief executive officer of Smartsheet, said in a statement. “Smartsheet empowers customers to unlock the potential of their teams and achieve better business results, giving them an edge in today’s macro environment.”

For its fiscal third quarter of 2023, Smartsheet expects an adjusted loss of 15 to 16 cents a share on revenue of $193 million to $194 million. For the full fiscal year 2023, Smartsheet predicts a loss of 49 to 56 cents per share on revenue of $750 million to $755 million.

Along with its latest earnings report, Smartsheet also announced that it has acquired Outfit, a Queensland, Australia-based provider of branded marketing materials. Founded in 2013, Outfit pitches itself as transforming how large organizations create, collaborate and share their branded marketing materials.

Smartsheet plans to quickly integrate Outfit’s design automation and templating capabilities into its Brandfolder offering so its customers can realize ever greater value from a more powerful content automation experience.

Coming into the acquisition, Outfit had raised $21 million in venture capital funding, according to Crunchbase. Investors included Five Elms Capital and Equity Venture Partners.

After initially dipping after the bell, shares in Smartsheet later were up about 0.6%.

Image: Smartsheet

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