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BigCommerce Announces Third Quarter Financial Results

November 4, 2021 4:05 PM

Third Quarter Total Revenue of $59.3 Million, an Increase of 49% Versus Prior YearTotal ARR of $253.5 Million, an Increase of 52% Versus Prior Year

AUSTIN, Texas, Nov. 04, 2021 (GLOBE NEWSWIRE) -- BigCommerce Holdings, Inc. (“BigCommerce”) (Nasdaq: BIGC), a leading Open SaaS ecommerce platform for fast-growing and established brands, today announced financial results for its third quarter ended September 30, 2021.

“Q3 was a record quarter on many dimensions for BigCommerce, including our 49% year-over-year revenue growth rate, which was our highest as a public company. This rapid growth reflects the success of our Open SaaS platform in serving ever-larger enterprise customers, B2B and headless use cases and new European markets,” said Brent Bellm, chief executive officer at BigCommerce. “Our financial results also incorporate the acquisition of Feedonomics, which provides BigCommerce merchants with market-leading capabilities in omnichannel advertising and selling across 100+ global marketplaces, search engines, social networks, and ad platforms.”

Third Quarter Financial Highlights:

Third Quarter Financials:

Other Key Business Metrics

Operating Income/(Loss)

Net Income/(Loss) and Earnings Per Share

Adjusted EBITDA

Cash

Business Highlights:

Q4 and 2021 Financial Outlook:

For the fourth quarter of 2021, the Company currently expects:

For the full year 2021, the Company currently expects:

The Company’s fourth quarter and 2021 financial outlook is based on a number of assumptions that are subject to change and many of which are outside the Company’s control. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that the Company will achieve these results.

The Company does not provide guidance for operating loss, the most directly comparable GAAP measure to Non-GAAP operating loss, and similarly cannot provide a reconciliation between its forecasted Non-GAAP operating loss and Non-GAAP net loss per share and these comparable GAAP measures without unreasonable effort due to the unavailability of reliable estimates for certain items. These items are not within the Company’s control and may vary greatly between periods and could significantly impact future financial results.

Conference Call Information

BigCommerce will host a conference call and webcast at 4:00 p.m. CT (5:00 p.m. ET) on Thursday, November 4, 2021, to discuss its financial results and business highlights. The conference call can be accessed by dialing (833) 519-1347 from the United States or Canada or (914) 800-3909 internationally with conference ID 9143128. The live webcast of the conference call and other materials related to BigCommerce’s financial performance can be accessed from BigCommerce’s investor relations website at http://investors.bigcommerce.com.

Following the completion of the call through 8:00 p.m. ET on November 11, 2021, a telephone replay will be available by dialing (855) 859-2056 from the United States and Canada or (404) 537-3406 internationally with conference ID 9143128. A webcast replay will also be available at http://investors.bigcommerce.com for 12 months.

About BigCommerce

BigCommerce (Nasdaq: BIGC) is a leading software-as-a-service (SaaS) ecommerce platform that empowers merchants of all sizes to build, innovate and grow their businesses online. As a leading Open SaaS solution, BigCommerce provides merchants sophisticated enterprise-grade functionality, customization and performance with simplicity and ease-of-use. Tens of thousands of B2B and B2C companies across 150 countries and numerous industries use BigCommerce to create beautiful, engaging online stores, including Ben & Jerry’s, Molton Brown, S.C. Johnson, Skullcandy, Sony and Vodafone. Headquartered in Austin, BigCommerce has offices in London, Kyiv, San Francisco, and Sydney.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “outlook,” “may,” “might,” “plan,” “project,” “will,” “would,” “should,” “could,” “can,” “predict,” “potential,” “strategy, “target,” “explore,” “continue,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. These statements may relate to our market size and growth strategy, our estimated and projected costs, margins, revenue, expenditures and customer and financial growth rates, our Q4 and 2021 financial outlook, our plans and objectives for future operations, growth, initiatives or strategies. By their nature, these statements are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance or achievement to differ materially and adversely from those anticipated or implied in the forward-looking statements. These assumptions, uncertainties and risks include that, among others, our business would be harmed by any decline in new customers, renewals or upgrades, our limited operating history makes it difficult to evaluate our prospects and future results of operations, we operate in competitive markets, we may not be able to sustain our revenue growth rate in the future, our business would be harmed by any significant interruptions, delays or outages in services from our platform or certain social media platforms, and a cybersecurity-related attack, significant data breach or disruption of the information technology systems or networks could negatively affect our business. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption “Risk Factors” and elsewhere in our filings with the Securities and Exchange Commission (the “SEC”), including our final prospectus under Rule 424(b) filed with the SEC on November 16, 2020, our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 26, 2021 and the future quarterly and current reports that we file with the SEC. Forward-looking statements speak only as of the date the statements are made and are based on information available to BigCommerce at the time those statements are made and/or management's good faith belief as of that time with respect to future events. BigCommerce assumes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law.

Use of Non-GAAP Financial Measures

We have provided in this press release certain financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Our management uses these Non-GAAP financial measures internally in analyzing our financial results and believes that use of these Non-GAAP financial measures is useful to investors as an additional tool to evaluate ongoing operating results and trends and in comparing our financial results with other companies in our industry, many of which present similar Non-GAAP financial measures. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable financial measures prepared in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. A reconciliation of our historical Non-GAAP financial measures to the most directly comparable GAAP measures has been provided in the financial statement tables included in this press release, and investors are encouraged to review these reconciliations.

Annual Revenue Run-Rate

We calculate annual revenue run-rate (“ARR”) at the end of each month as the sum of: (1) contractual monthly recurring revenue at the end of the period, which includes platform subscription fees, invoiced growth adjustments, feed management subscription fees, recurring professional services revenue, and other recurring revenue, multiplied by twelve to prospectively annualize recurring revenue, and (2) the sum of the trailing twelve-month non-recurring and variable revenue, which includes one-time partner integrations, one-time fees, payments revenue share, and any other revenue that is non-recurring and variable.

Accounts with Greater than $2,000 ACV

We track the total number of accounts with annual contract value (“ACV”) greater than $2,000 (the “ACV threshold”) as of the end of a monthly billing period. To define this $2,000 ACV cohort, we include only subscription plan revenue and exclude partner and services revenue and recurring services revenue. We consider all stores and brands added and subtracted as of the end of the monthly billing period. This metric includes accounts that may have either one single store or brand above the ACV threshold or multiple stores or brands that together exceed the ACV threshold.

Enterprise Account Metrics

To measure the effectiveness of our ability to execute against our growth strategy, particularly within the mid-market and enterprise business segments, we calculate ARR attributable to Enterprise Accounts. We define Enterprise Accounts as accounts with at least one unique Enterprise plan subscription or an enterprise level feed management subscription (collectively “Enterprise Accounts”). These accounts may have more than one Enterprise plan or a combination of Enterprise plans and Essentials plans.

Average Revenue Per Account

We calculate average revenue per account (ARPA) for accounts above the ACV threshold at the end of a period by including customer-billed revenue and an allocation of partner and services revenue, where applicable. We allocate partner revenue, where applicable, primarily based on each customer’s share of GMV processed through that partner’s solution. For partner revenue that is not directly linked to customer usage of a partner’s solution, we allocate such revenue based on each customer’s share of total platform GMV. Each account’s partner revenue allocation is calculated by taking the account’s trailing twelve-month partner revenue, then dividing by twelve to create a monthly average to apply to the applicable period in order to normalize ARPA for seasonality.

Adjusted EBITDA

We define Adjusted EBITDA as our net loss, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions, depreciation and amortization expense, interest income, interest expense, changes in fair value of financial instruments, and our provision for income taxes. The most directly comparable GAAP measure is net loss.

Non-GAAP Operating Loss

We define Non-GAAP Operating Loss as our GAAP Loss from operations, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions and amortization of acquisition-related intangible assets. The most directly comparable GAAP measure is our loss from operations.

Non-GAAP Net Loss

We define Non-GAAP Net Loss as our GAAP net loss, excluding the impact of stock-based compensation expense and related payroll tax expense, third party acquisition-related costs, and other acquisition related expenses, including contingent compensation arrangements entered into in connection with acquisitions, amortization of acquisition-related intangible assets and changes in fair value of financial instruments. The most directly comparable GAAP measure is our net loss.

Non-GAAP Net Loss per Share

We define Non-GAAP Net Loss per Share as our Non-GAAP Net Loss, defined above, divided by our basic and diluted GAAP weighted average shares outstanding. The most directly comparable GAAP measure is our net loss per share.

Free Cash Flow

We define Free Cash flow as our GAAP cash flow from operating activities plus our GAAP purchases of property and equipment (Capital Expenditures). The most directly comparable GAAP measure is our cash flow from operating activities.

Consolidated Balance Sheets

(in thousands, except per share amounts)

September 30, December 31,
2021 2020
Assets
Current assets
Cash and cash equivalents $364,909 $219,447
Restricted cash 1,141 1,160
Marketable securities 43,467 —
Accounts receivable, net 33,775 22,894
Prepaid expenses and other assets 13,722 8,000
Deferred commissions 3,445 2,571
Total current assets 460,459 254,072
Property and equipment, net 7,383 7,122
Right-of-use-assets 10,204 11,842
Prepaid expenses, net of current portion 913 —
Deferred commissions, net of current portion 4,800 3,590
Intangible assets, net 35,360 —
Goodwill 41,374 —
Total assets $560,493 $276,626
Liabilities and stockholders’ equity
Current liabilities
Accounts payable $5,885 $5,788
Accrued liabilities 2,890 3,344
Deferred revenue 12,910 11,406
Current portion of operating lease liabilities 2,925 3,173
Other current liabilities 24,148 22,176
Total current liabilities 48,758 45,887
Deferred revenue, net of current portion 1,481 1,308
Long-term debt, net of current portion 335,050
Other long-term liabilities 3,210
Operating lease liabilities, net of current portion 10,805 12,672
Total liabilities 399,304 59,867
Commitments and contingencies (Note 6)
Stockholders’ equity
Convertible preferred stock, $0.0001 par value; 10,000 shares authorizedat September 30, 2021 and December 31, 2020; 0 sharesissued and outstanding, at September 30, 2021 and December 31, 2020.Common stock, $0.0001 par value; 500,000 shares Series 1 and, 5,051 shares Series 2authorized at September 30, 2021 and December 31, 2020; 71,619, and 64,461 sharesSeries 1 issued and outstanding at September 30, 2021 and December 31, 2020, respectively,and 0 and 5,051 shares Series 2 issued and, outstanding atSeptember 30, 2021, and December 31, 2020, respectively 7 7
Additional paid-in capital 517,006 530,143
Accumulated deficit (355,824) (313,391)
Total stockholders’ equity 161,189 216,759
Total liabilities and stockholders’ equity $560,493 $276,626

Consolidated Statements of Operations

(in thousands, except per share amounts)

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Revenue $59,285 $39,735 $154,958 $109,225
Cost of revenue 12,403 8,593 31,838 23,910
Gross profit 46,882 31,142 123,120 85,315
Operating expenses:
Sales and marketing 26,101 19,328 69,066 51,893
Research and development 16,532 12,124 44,792 34,390
General and administrative 14,370 9,745 39,089 23,925
Acquisition related expenses 9,792 — 10,899 —
Amortization of intangible assets 1,402 — 1,402 —
Total operating expenses 68,197 41,197 165,248 110,208
Loss from operations (21,315) (10,055) (42,128) (24,893)
Interest income 24 2 65 20
Interest expense (125) (741) (125) (2,655)
Change in fair value of financial instruments — — — 4,413
Other income (expense) 5 (75) 18 (238)
Loss before provision for income taxes (21,411) (10,869) (42,170) (23,353)
Provision for income taxes 257 (14) 263 6
Net loss $(21,668) $(10,855) $(42,433) $(23,359)
Dividends and accretion of issuance costs on Series F preferred stock $— $2,732 $— $(962)
Net loss attributable to common stockholders $(21,668) $(8,123) $(42,433) $(24,321)
Basic and diluted net loss per share attributable to common stockholders $(0.30) $(0.16) $(0.60) $(0.83)
Weighted average shares used to compute basic and diluted net loss per share attributable to common stockholders 71,372 49,355 70,598 29,145

Consolidated Statement of Cash Flows

(in thousands)

Nine months ended September 30, Nine months ended September 30,
2021 2020
Cash flows from operating activities
Net loss $(42,433) $(23,359)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 3,521 2,377
Amortization of discount on debt 87 480
Stock-based compensation 17,682 5,038
Allowance for credit losses 2,124 1,198
Change in fair value of financial instrument — (4,413)
Changes in operating assets and liabilities:
Accounts receivable (9,898) (7,473)
Prepaid expenses (6,507) (3,675)
Deferred commissions (2,084) (1,454)
Accounts payable (189) 1,685
Accrued and other liabilities 4,537 4,319
Deferred revenue 1,677 2,077
Net cash used in operating activities (31,483) (23,200)
Cash flows from investing activities:
Cash paid for acquisition (80,952)
Purchase of property and equipment (2,287) (1,378)
Purchase of marketable securities (43,467) —
Net cash used in investing activities (126,706) (1,378)
Cash flows from financing activities:
Proceeds from issuance of convertible senior notes 345,000 —
Payment of debt issuance costs (10,037) —
Purchase of capped calls (35,570) —
Proceeds from exercise of stock options 4,239 1,947
Payment of dividends — (12,814)
Proceeds from issuance of common stock upon initial public offering, net of underwriting discounts and commissions and other offering costs — 171,128
Proceeds from debt — 41,861
Repayment of debt — (6,715)
Net cash provided by financing activities 303,632 195,407
Net change in cash and cash equivalents and restricted cash 145,443 170,829
Cash and cash equivalents and restricted cash, beginning of period 220,607 9,150
Cash and cash equivalents and restricted cash, end of period $366,050 $179,979
Supplemental cash flow information:
Cash paid for interest $— $1,519
Noncash investing and financing activities:
Conversion of convertible preferred stock into common stock upon initial public offering $— $211,902
Conversion of convertible debt into common stock upon initial public offering $— $50,173
Reconciliation of cash, cash equivalents and restricted cash within the condensed consolidated balance sheet to the amounts shown in the statements of cash flows above:
Cash and cash equivalents 364,909 178,846
Restricted cash 1,141 1,133
Total cash, cash equivalents and restricted cash $366,050 $179,979

Revenue by Source

(in thousands)

Three months ended September 30, Nine months ended September 30,
(in thousands) 2021 2020 2021 2020
Subscription solutions $42,122 $26,545 $108,081 $74,041
Partner and services 17,163 13,190 46,877 35,184
Total revenue $59,285 $39,735 $154,958 $109,225

Reconciliation of GAAP to Non-GAAP Results

(in thousands, except per share amounts)

Reconciliation of Operating Loss to Non-GAAP Operating Loss

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Operating loss $(21,315) $(10,055) $(42,128) $(24,893)
Less: stock-based compensation expense 5,989 2,868 17,682 5,038
Less: payroll tax associated with stock-based compensation expense 304 — 967 —
Less: third-party acquisition related costs 9,792 — 10,899 —
Less: amortization of intangible assets $1,402 $— $1,402 $—
Non-GAAP operating loss (3,828) (7,187) (11,178) (19,855)
Non-GAAP operating margin (6.5)% (18.1)% (7.2)% (18.2)%

Reconciliation of Net Loss and Net Loss per share to Non-GAAP Net Loss & Non-GAAP Net Loss per share

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Net loss $(21,668) $(10,855) $(42,433) $(23,359)
Less: stock-based compensation expense 5,989 2,868 17,682 5,038
Less: payroll tax associated with stock-based compensation expense 304 — 967 —
Less: third-party acquisition related costs 9,792 — 10,899 —
Less: amortization of intangible assets 1,402 — 1,402 —
Less: change in fair value of financial instruments — — — (4,413)
Non-GAAP net loss (4,181) (7,987) (11,483) (22,734)
Non-GAAP net loss per share (0.06) (0.16) (0.16) (0.78)
Weighted average shares used to compute basic and diluted net loss per share attributable to common stockholders 71,372 49,355 70,598 29,145
Non-GAAP net loss margin (7.1)% (20.1)% (7.4)% (20.8)%

Reconciliation of Net Loss to adjusted EBITDA

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Net loss $(21,668) $(10,855) $(42,433) $(23,359)
Stock-based compensation expense 5,989 2,868 17,682 5,038
Payroll tax associated with stock-based compensation expense 304 — 967 —
Third-party acquisition related costs 9,792 — 10,899 —
Depreciation 714 699 2,151 2,377
Amortization of intangible assets 1,402 — 1,402 —
Interest income (24) (2) (65) (20)
Interest expense 125 741 125 2,655
Change in fair value of financial instrument — — — (4,413)
Provision for income taxes 257 (14) 263 6
Adjusted EBITDA $(3,109) $(6,563) $(9,009) $(17,716)
Adjusted EBITDA Margin (5.2)% (16.5)% (5.8)% (16.2)%

Reconciliation of Cost of Revenue to Non-GAAP Cost of Revenue

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Cost of revenue $12,403 $8,593 $31,838 $23,910
Less: share-based compensation expense 293 179 1,206 334
Less: payroll tax associated with share-based compensation expense 17 — 64 —
Non-GAAP cost of revenue 12,093 8,414 30,568 23,576
As a % of revenue 20.4% 21.2% 19.7% 21.6%

Reconciliation of Sales and Marketing expense to Non-GAAP Sales and Marketing expense

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Sales and marketing $26,101 $19,328 $69,066 $51,893
Less: share-based compensation expense 1,829 871 5,351 1,511
Less: payroll tax associated with share-based compensation expense 181 — 416 —
Non-GAAP sales and marketing 24,091 18,457 63,299 50,382
As a % of revenue 40.6% 46.5% 40.8% 46.1%

Reconciliation of Research and Development expense to Non-GAAP Research and Development expense

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
Research and development $16,532 $12,124 $44,792 $34,390
Less: share-based compensation expense 1,566 582 4,180 1,216
Less: payroll tax associated with share-based compensation expense 58 — 237 —
Non-GAAP research and development 14,908 11,542 40,375 33,174
As a % of revenue 25.1% 29.0% 26.1% 30.4%

Reconciliation of General and Administrative expense to Non-GAAP General and Administrative expense

Three months ended September 30, Nine months ended September 30,
2021 2020 2021 2020
General & administrative $14,370 $9,745 $39,089 $23,925
Less: share-based compensation expense 2,301 1,236 6,945 1,977
Less: payroll tax associated with share-based compensation expense 48 — 250 —
Non-GAAP general & administrative 12,021 8,509 31,894 21,948
As a % of revenue 20.3% 21.4% 20.6% 20.1%

Reconciliation of net cash used in operating activities to Free Cash Flow

Nine months ended September 30, Nine months ended September 30,
(in thousands) 2021 2020
Net cash used in operating activities $(31,483) $(23,200)
Capital expenditures $(2,287) $(1,378)
Free cash flow $(33,770) $(24,578)

Media Relations Contact Investor Relations Contact
Meghan StablerAmit Marwaha
[email protected] [email protected]
(737) 236-2363

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Source: BigCommerce Holdings, Inc.

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