GTY Technology (GTYH) Misses Q2 EPS by 8c, Revenues Beat

GTY Technology (NASDAQ: GTYH) reported Q2 EPS of ($0.15), $0.08 worse than the analyst estimate of ($0.07). Revenue for the quarter came in at $11.31 million versus the consensus estimate of $11 million.

“We delivered significant revenue growth this quarter while getting leaner and remaining focused on growth, cost reductions and customer satisfaction. We’ve also deployed centralized processes and discipline to be more predictable in our execution and results,” said TJ Parass, CEO of GTY. “Customer retention and loyalty are at an all-time high. The COVID-19 pandemic is driving organizations in the public sector to continually iterate their budgets, rapidly seek and manage grants, and modernize other government functions, such as serving citizens remotely. We believe GTY is well-positioned to help these organizations address these time sensitive, evolving demands.

"GTY's mission is to help digitize the public sector so that government can work like most other private organizations in modern life -- quickly and online,” said Parass. “With GTY, government customers are able to digitally transform critical applications in days or weeks so that they can be effective working remotely in this dynamic environment while better serving their customers. Our free COVID-19 Care program is now introducing hundreds of new prospects to our offerings while helping entities such as nonprofits when they need it the most.

“In the mid-market in particular, government offices are favoring GTY for the value of our solutions and the speed of deployment. Our customers can now apply for grants, manage and track grant deployments, conduct the necessary budget iterations, procure goods and services and deploy touch-less cash payments so that no government employee has to feel unsafe handling cash. All while being remote. Governments using our technology solutions are serving citizens and themselves better and faster,” said Parass.

Financial Discussion and Outlook

According to John Curran, CFO of GTY, “Our cost reduction initiatives are working as expected. We experienced a savings of more than $3 million in our quarterly operating expenses. We are planning for our operating expenses to remain at this level each quarter for the balance of the year. On the revenue side, recurring revenues were up 7% compared with Q1 2020 and up 23% compared with Q2 2019. We are on track with our revenue growth expectation from Q1 2020 of more than 20% for the full year 2020.”

Second quarter 2020 operating loss narrowed to $7.8 million compared with $16.5 million in Q1 2020. Second quarter non-GAAP operating loss narrowed to $2.8 million compared with $5.7 million in Q1 2020.

For earnings history and earnings-related data on GTY Technology (GTYH) click here.

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