Informatica Inc (INFA, Financial), a leader in enterprise cloud data management, released its Q3 2023 earnings report on November 1, 2023. The company reported a 15% YoY increase in Subscription Annual Recurring Revenue (ARR) to $1.08 billion, and a 37% YoY increase in Cloud Subscription ARR to $550 million. The company also exceeded the high end of guidance across all Q3 2023 metrics and raised its full-year 2023 Non-GAAP Operating Income and Adjusted Unlevered Free Cash Flow (after-tax) guidance.
Financial Highlights
Informatica's GAAP Total Revenues increased 10% YoY to $408.6 million, including a positive impact of approximately $5.0 million from foreign currency exchange rates (FX) YoY. GAAP Subscription Revenues increased 22% YoY to $261.8 million. Total ARR increased 7% YoY to $1.58 billion, including a negative impact of approximately $1.4 million from FX YoY. The company reported a GAAP Operating Income of $32.1 million and Non-GAAP Operating Income of $128.1 million. GAAP Operating Cash Flow was $58.7 million and Adjusted Unlevered Free Cash Flow (after-tax) was $96.1 million.
Business Highlights
Informatica processed 71.3 trillion cloud transactions per month for the quarter ended September 30, 2023, a 60% YoY increase. The company reported 224 customers that spend more than $1 million in subscription ARR at the end of September 30, 2023, a 17% YoY increase. It also reported 1,978 customers that spend more than $100,000 in subscription ARR at the end of September 30, 2023, a 7% YoY increase.
Restructuring Plan
Informatica announced a plan to reduce its workforce by approximately 545 employees, representing 10% of the company's current global workforce, and to reduce its global real estate footprint. The plan is intended to streamline the company's cost structure as a direct result of its cloud-only, consumption-driven strategy announced in January 2023. The company expects no impact to full-year 2023 guidance due to this restructuring.
Financial Outlook
For the full-year 2023, Informatica expects GAAP Total Revenues to be in the range of $1,570 million to $1,590 million, representing approximately 5% YoY growth at the midpoint of the range. Total ARR is expected to be in the range of $1,585 million to $1,615 million, representing approximately 5% YoY growth at the midpoint of the range. Subscription ARR is expected to be in the range of $1,098 million to $1,118 million, representing approximately 11% YoY growth at the midpoint of the range. Cloud Subscription ARR is expected to be in the range of $604 million to $614 million, representing approximately 35% YoY growth at the midpoint of the range.
For the fourth quarter 2023, GAAP Total Revenues are expected to be in the range of $420 million to $440 million, representing approximately 8% YoY growth at the midpoint of the range. Subscription ARR is expected to be in the range of $1,098 million to $1,118 million, representing approximately 11% YoY growth at the midpoint of the range. Cloud Subscription ARR is expected to be in the range of $604 million to $614 million, representing approximately 35% YoY growth at the midpoint of the range.
Explore the complete 8-K earnings release (here) from Informatica Inc for further details.
