An outstanding Q1 2020 builds on strong 2019 results
Oslo, Norway, 6th April 2020
The video communications provider, Pexip, today announced record 50% year-on-year growth in contracted annual recurring revenue (ARR) after first quarter 2020, further enhancing the recently reported growth of 32% in 2019. Q1 2020 finished with a significant increase in delta annual recurring revenue (DARR) of 9.5MUSD, giving a total contracted annual recurring revenue (ARR) of 56.7 MUSD.
A significant part of the growth comes from increased demand from existing customers. Pexip experienced a Net Retention Rate in Q1 of 113% (based on revenue) for the previous 12 months, up from 99% in Q4 2019.
The Company reports that the strong results and momentum from 2019 are being further spurred by the current Covid-19 situation as more and more companies turn to video communication to enable business continuity. Pexip has seen a growth of 7 x peak traffic on its service in the past month alone. This increase in capacity demand comes from a mix of existing users and new customers. In particular, there has been an increased demand from health care providers and governments globally who have the need for secure video communication. Pexip believes that the current change in working behaviour with more home offices, remote consultations and conferences will continue to drive usage and adoption of video beyond the Covid-19 crisis.
“Last year was by far the strongest so far, not only financially, but also in terms of the technological development of our products and services, and the addition of new customers globally. One of the things we are most proud of is the customer satisfaction and our steadily increasing Net Retention Rates. This tells us that some of the world's largest companies are long-term faithful users of our unique technology by renewing their relationship with us. This of course makes us proud, but also humble and motivated to further develop our technology. We believe that our unique user experience combined with our privacy and deployment options position us well for future success,” said Odd Sverre Østlie, CEO of Pexip.
“We are now witnessing a dramatic increase in the use of our solutions worldwide because of the current Covid-19 situation. This is not a pleasant situation for anyone, but it’s good that our technology can be of help to our customers, whether they are in the private or public sector. We see that the Pexip solution is enabling our users to fulfill their tasks in the best possible way during these challenging times,” said Michel Sagen, Chairman of the Board of Pexip.
In 2019, Pexip grew into a leading global player in video conferencing solutions. Pexip serves enterprise and public sector customers across the globe, including 15% of the Global Fortune 500. The company currently has over 200 employees in seven offices in 18 countries, spread across three continents. Fifty-five percent of subscription revenue comes from EMEA, 33% from North America and 12% from APAC.
2019 / Q1 2020 Financial Highlights in Summary:
- Total revenue of 370 MNOK, a growth of 32% from 2018
- Earnings of 76 MNOK, up from 32 MNOK in 2018, which corresponds to an EBITDA margin of 21%
- Gross Margin of 95%
- Contracted Annual Recurring Revenue of 47 MUSD, a growth of 11.7 MUSD
- Customer Net retention Rate (% of ARR) of 99%
Q1 2020 -
- Contracted Annual Recurring Revenue of 56.7 MUSD, up 50% from Q1 2019
- Q1 Growth in Annual Recurring Revenue of 9.5 MUSD
- Customer Net Retention Rate of 113% for the previous 12 months, up from 99% in Q4 2019
Pexip simplifies complex video conferencing to empower teams to meet, regardless of location or technology. Our scalable, cloud-native platform enables high-quality video meetings, interoperability with Microsoft and Google solutions, and video system device registration. Customers can deploy Pexip on their own privately hosted servers, in their own cloud subscription of choice (Azure, Google Cloud or AWS), as a hybrid, or as a service. With a diverse set of APIs, Pexip can be customized to fit customers’ unique needs. The solution is sold through 300 channel partners in 75 countries and used in more than 190 countries.
For questions, please contact:
Øystein Hem, CFO, +47 992 34 596