Release Date: October 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bambuser AB (BSKZF, Financial) is operating in a massive and growing market projected to reach $8.5 trillion by 2030.
- The company has launched innovative AI dubbing technology, allowing for seamless multilingual shoppable video experiences.
- Bambuser AB (BSKZF) reported a 27% improvement in adjusted EBITA compared to last year, reflecting effective cost control.
- The company ended the quarter with a strong cash position of Kr191 million.
- Bambuser AB (BSKZF) is focusing on larger enterprise customers, which could lead to more significant deals in the future.
Negative Points
- The company's AR growth was negative this quarter, with a decline of 7% quarter over quarter.
- The Americas region showed a declining ARR, impacting overall performance.
- Gross margin was negatively impacted due to the acquisition of Hero, leading to higher costs.
- The current AR does not fully reflect ongoing operations, indicating potential volatility in business momentum.
- There is a need for further improvements in fixed costs, suggesting current cost structures may not be optimal.
Q & A Highlights
Q: Could you tell us more about the current business momentum and pipeline, given the recent soft performance and negative trend in ARR?
A: The US market has been a challenge, impacting our performance. However, we have a strong pipeline, particularly with larger enterprise companies, and improvements are expected. The timing of deal closures affects quarterly results, but regions like MIA and APAC are performing well. The US is improving, though not yet reflected in the balance sheet.
Q: Regarding costs, is the current cost base what you aim to maintain, or are further adjustments expected?
A: We believe there are still fixed costs that can be improved. We aim to tailor more of our fixed costs towards marketing, allowing flexibility to adjust based on market conditions and traction. Therefore, improvements in the fixed cost base are expected.
Q: Can you elaborate on the impact of the acquisition of Hero on gross margins and future expectations?
A: The acquisition of Hero has temporarily impacted gross margins due to higher costs during the technical carve-out and transition phase. As we integrate Hero into our tech stack, we anticipate realizing cost efficiencies and expect gross margins to improve.
Q: What are the key factors contributing to the improvement in adjusted EBITA?
A: The 27% improvement in adjusted EBITA compared to last year is primarily due to disciplined cost control and effective management of operating expenses, which continue to decrease.
Q: How is the cash flow development, and what are the expectations moving forward?
A: Cash flow continues to develop positively, despite being impacted by negative working capital this quarter. We expect ongoing improvements in adjusted EBITA to further enhance cash flow, supported by a strong cash position of Kr191 million at the end of the quarter.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
