Q1 2024 Instructure Holdings Inc Earnings Call Transcript
Key Points
- Instructure Holdings Inc reported a total revenue of $155.5 million, marking a 20.7% increase year-over-year.
- Subscription and support revenue grew by 22.1% to $144.7 million, demonstrating strong organic growth.
- Adjusted EBITDA of $64.9 million grew 34.6% year-over-year, with a significant margin expansion to 41.8%.
- The company successfully integrated the acquisition of Parchment, which exceeded revenue expectations and contributed to double-digit growth.
- Instructure Holdings Inc is on track to achieve a $1 billion revenue target by 2028, supported by robust annual recurring revenue growth and strategic acquisitions.
- Despite overall growth, the company experienced elongated decision-making cycles in its core North American LMS markets.
- Operating cash flow was negative $92.6 million, primarily due to early collections in the previous quarter and higher interest expenses from the Parchment acquisition.
- The company faces ongoing macroeconomic uncertainties and regulatory pressures in the education sector.
- There is a need for continuous investment in technology and program spend, which could impact short-term profitability.
- Instructure Holdings Inc is still in the process of fully integrating Parchment's go-to-market and cross-sell strategies, which could pose challenges in realizing full synergy benefits.
Ladies and gentlemen, thank you for standing by, and welcome to Instructure's First Quarter 2024 earnings call. (Operator Instructions) Please be advised that this conference is being recorded, and I would now like to turn the conference over to your first speaker, Matthew Wells, Senior Vice President, Investor Relations. Matthew, please go ahead.
Good afternoon, and welcome to Instructure's First Quarter 2024 earnings conference call. We will be discussing first quarter results and updated guidance. As announced in our press release published earlier today and to accompany the discussion, we've uploaded an earnings presentation to our Investor Relations website. I encourage you to review this presentation alongside our prepared remarks. On the call today, we have Instructure's Chief Executive Officer, Steve Daly; and Chief Financial Officer, Peter Walker.
Before we begin, I'd like to remind you that today's conference call and earnings presentation will include forward
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