Q3 2024 Kinaxis Inc Earnings Call Transcript
Key Points
- Kinaxis Inc (KXSCF) reported a 16% growth in SaaS revenue, reaching $78.6 million, and a total revenue growth of 12%, amounting to $121.5 million.
- The company achieved over $30 million in adjusted EBITDA, representing a 32% growth and a 25% margin, allowing them to raise profitability guidance for the third consecutive quarter.
- Kinaxis Inc (KXSCF) won an impressive number of new customers across various sectors, including Life Sciences, Industrial, Consumer Products, and Automotive, reflecting strong demand for their supply chain solutions.
- The company continues to innovate with AI-based products, with over 100 customers actively using the Maestro AI chat agent and significant improvements in demand forecasts through Demand.ai.
- Kinaxis Inc (KXSCF) received exceptional validation from third-party industry observers, being named a 2024 Gartner Peer Insights Customer Choice for supply chain planning solutions and recognized by Newsweek as one of Canada's most responsible companies for 2025.
- Despite the positive growth, the company faces elongated contractual negotiations and proof of concept requirements, which are extending sales cycles.
- There is a high level of scrutiny in buying decisions, particularly for large enterprise businesses, which could impact future growth.
- The company is experiencing slower deal approvals, partly due to the S/4HANA migration, which, while beneficial, can extend sales cycles.
- The adjusted EBITDA margin guidance remains at 20% to 22%, indicating that while profitability is improving, it has not yet reached the mid-term target of 25%.
- The company is facing execution risks due to leadership changes, although no significant impacts have been reported yet.
Good morning, ladies and gentlemen. Welcome to the Kinaxis Inc. fiscal 2024 third-quarter results conference call. (Operator Instructions) I'd like to remind everyone that this call is being recorded today, Thursday, October 31, 2024. I will now turn the call over to Rick Wadsworth, Vice President of Investor Relations at Kinaxis Inc. Please go ahead, Mr. Wadsworth.
Thanks, operator. Good morning, and welcome to the Kinaxis' earning call. Today, we will be discussing our third quarter results, which we issued after close of markets yesterday. With me on the call are John Sicard, our President and Chief Executive Officer; Bob Courteau, our Executive Chair; and Blaine Fitzgerald, our Chief Financial Officer. Some of the information discussed on the call is based on information as of today, October 31, 2024, and contains forward-looking statements that involve risks and uncertainties.
Actual results may differ materially from those set forth in such statements. For a discussion of these
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