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Intapp Announces Third Quarter Fiscal Year 2023 Financial Results

  • Third quarter SaaS and support revenue of $66.1 million, up 33% year-over-year
  • Third quarter total revenue of $92.0 million, up 32% year-over-year
  • Cloud annual recurring revenue (ARR) of $206.3 million, up 40% year-over-year

PALO ALTO, Calif., May 08, 2023 (GLOBE NEWSWIRE) -- Intapp, Inc. (NASDAQ: INTA), a leading provider of cloud software for the global professional and financial services industry, announced its financial results for the third quarter of fiscal year 2023 ended March 31, 2023. Intapp also provided its outlook for the fourth quarter and full fiscal year of 2023.

“We are pleased to report another quarter of strong results as professional and financial services firms continue to embrace our purpose-built cloud solutions,” said John Hall, CEO of Intapp. “Our third quarter results and steady demand for our technology validate our position as the leaders in digital transformation for the industry we serve.”

Third Quarter of Fiscal Year 2023 Financial Highlights

  • SaaS and support revenue was $66.1 million, a 33% year-over-year increase compared to the third quarter of fiscal year 2022.
  • Total revenue was $92.0 million, a 32% year-over-year increase compared to the third quarter of fiscal year 2022.
  • Cloud ARR was $206.3 million as of March 31, 2023, a 40% year-over-year increase compared to Cloud ARR at the end of the third quarter in the prior year. Cloud ARR represented 65% of total ARR as of March 31, 2023, compared to 58% as of March 31, 2022.
  • Total ARR was $315.6 million as of March 31, 2023, a 24% year-over-year increase compared to total ARR at the end of the third quarter in the prior year.
  • GAAP operating loss was ($18.2) million, compared to a GAAP operating loss of ($28.7) million in the third quarter of fiscal year 2022.
  • Non-GAAP operating profit was $2.9 million, compared to a non-GAAP operating loss of ($2.2) million in the third quarter of fiscal year 2022.
  • GAAP net loss was ($18.1) million, compared to a GAAP net loss of ($28.7) million in the third quarter of fiscal year 2022.
  • Non-GAAP net income was $2.2 million, compared to a non-GAAP net loss of ($2.3) million in the third quarter of fiscal year 2022.
  • GAAP net loss per share was ($0.28), compared to a GAAP net loss per share of ($0.47) in the third quarter of fiscal year 2022.
  • Non-GAAP fully diluted net income per share was $0.03, compared to a non-GAAP net loss per share of ($0.04) in the third quarter of fiscal year 2022.

Balance Sheet and Cash Flow Highlights

  • Cash and cash equivalents were $53.2 million as of March 31, 2023, compared to $50.8 million as of June 30, 2022, primarily reflecting net cash provided by operating activities and proceeds from stock option exercises, reduced by payments of deferred contingent consideration associated with acquisitions.
  • For the nine months ended March 31, 2023, cash provided by operating activities was $16.8 million, compared to cash provided by operating activities of $4.6 million for the nine months ended March 31, 2022.

Business Highlights

  • As of March 31, 2023, we served more than 2,250 clients, 572 of which each generated more than $100,000 of ARR.
  • We upsold and cross-sold our existing clients such that our trailing twelve months’ net revenue retention rate as of March 31, 2023 was within our recently increased range of 113% to 117%.
  • We continued to add new clients and expand existing accounts including AmLaw 200 firm Benesch, virtual law firm Practus, and private equity firm Excel Group.
  • DealCloud won two industry awards in the third quarter of fiscal year 2023. It won Best Deal Origination Technology and Best Secure Workflow Management Provider in the 2023 Private Equity Wire European Awards and was named a top influencer in commercial real estate technology by GlobeSt Real Estate Forum.

Fourth Quarter and Full Fiscal Year 2023 Outlook

 Fiscal 2023 Outlook
 Fourth QuarterFiscal Year
SaaS and support revenue (in millions)$67.0 - $68.0$251.5 - $252.5
Total revenue (in millions)$92.5 - $93.5$349.0 - $350.0
Non-GAAP operating profit (in millions)$1.5 - $2.5$9.0 - $10.0
Non-GAAP diluted net income per share$0.00 - $0.02$0.07 - $0.09

The guidance provided above constitutes forward-looking statements and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

The information presented in this press release includes non-GAAP financial measures such as “non-GAAP operating profit (loss),” “non-GAAP net income (loss),” and “non-GAAP net income (loss) per share.” Refer to “Non-GAAP Financial Measures and Other Metrics” for a discussion of these measures and the financial tables below for reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure. The Company has not included a quantitative reconciliation of its guidance for non-GAAP operating profit and non-GAAP diluted net income per share to their most directly comparable GAAP financial measures because certain of these reconciling items, including stock-based compensation and amortization of intangible assets, could be highly variable and cannot be reasonably predicted without unreasonable effort. This is due to the inherent difficulty of forecasting the timing of certain events that have not yet occurred and are out of the Company’s control and the amounts of associated reconciling items. Please note that the unavailable reconciling items could significantly impact the Company’s GAAP operating results.

Corporate Presentation

A supplemental financial presentation and other information will be accessible through Intapp’s investor relations website at https://investors.intapp.com/

Webcast

Intapp will host a conference call for analysts and investors on Monday, May 8, 2023, beginning at 2:00 p.m. PT (5:00 p.m. ET). The call will be webcast live via the “Investors” section of the Intapp company website at https://investors.intapp.com/. A replay of the call will be available through the Intapp website for 90 days.

About Intapp

Intapp makes the connected firm possible. We provide cloud software solutions that address the unique operating challenges and regulatory requirements of the global professional and financial services industry. Our solutions help more than 2,250 of the world’s premier private capital, investment banking, legal, accounting, and consulting firms connect their most important assets: people, processes, and data. As part of a connected firm, professionals gain easy access to the information they need to win more business, increase investment returns, streamline deal and engagement execution, and strengthen risk management and compliance.

Forward-Looking Statements

This press release contains express and implied “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial outlook for the fourth quarter and full year of fiscal year 2023, growth strategy, business plans and market position. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “would,” “should,” “could,” “can,” “predict,” “potential,” “target,” “explore,” “continue,” “expand,” “outlook” or the negative of these terms, and similar expressions intended to identify forward-looking statements. 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 statements, including: our ability to continue our growth at or near historical rates; our future financial performance and ability to be profitable; the effect of global events, such as outbreaks, epidemics, or pandemics involving public health, including the COVID-19 pandemic and Russia’s invasion of Ukraine, on the U.S. and global economies, our business, our employees, results of operations, financial condition, demand for our products, sales and implementation cycles, and the health of our clients' and partners' businesses; our ability to prevent and respond to data breaches, unauthorized access to client data or other disruptions of our solutions; our ability to effectively manage U.S. and global market and economic conditions, including inflationary pressures, economic and market downturns and volatility in the financial services industry, particularly adverse to our targeted industries; the length and variability of our sales cycle; our ability to attract and retain customers; our ability to attract and retain talent; our ability to compete in highly competitive markets; our ability to manage additional complexity, burdens, and volatility in connection with our international sales and operations; our ability to incur indebtedness in the future and the effect of conditions in credit markets; the sufficiency of our cash and cash equivalents to meet our liquidity needs; and our ability to maintain, protect, and enhance our intellectual property rights. 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 Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, and any subsequent public filings. Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. Forward-looking statements speak only as of the date the statements are made and are based on information available to us at the time those statements are made and/or management's good faith belief as of that time with respect to future events. We assume no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law.

Non-GAAP Financial Measures and Other Metrics

This press release contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating profit (loss), non-GAAP net income (loss) and non-GAAP net income (loss) per share. These non-GAAP measures exclude the impact of stock-based compensation, amortization of intangible assets, lease modification and impairment, change in fair value of contingent consideration, acquisition-related transaction costs and the income tax effect of non-GAAP adjustments. See below for a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure.

Other metrics include total ARR, Cloud ARR and net revenue retention rate. Total ARR represents the annualized recurring value of all active SaaS and on-premises subscription contracts at the end of a reporting period. Cloud ARR is the portion of the annualized recurring value of our active SaaS contracts at the end of a reporting period. Contracts with a term other than one year are annualized by taking the committed contract value for the current period divided by number of days in that period, then multiplying by 365.

Net revenue retention rate is calculated by starting with the ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period ARR. We then calculate the ARR from these same clients as of the current fiscal period, or current period ARR. We then divide the current period ARR by the prior period ARR to calculate the net revenue retention rate.

We believe these non-GAAP financial measures and metrics provide useful information to investors as they are used by management to manage the business, make planning decisions, evaluate our performance, and allocate resources and provide useful information regarding certain financial and business trends relating to our financial condition and results of operations. These non-GAAP financial measures, which may be different than similarly-titled measures used by other companies, should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Guidance for non-GAAP financial measures excludes stock-based compensation expense and amortization of intangible assets. Non-GAAP diluted net income per share is calculated by dividing non-GAAP net income by the estimated fully diluted weighted average shares outstanding for the period.

Investor Contact

David Trone
Senior Vice President, Investor Relations
Intapp, Inc.
ir@intapp.com 

Media Contact

Ali Robinson
Global Media Relations Director
Intapp, Inc.
Ali.robinson@intapp.com


INTAPP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share data and percentages)

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
Revenues            
SaaS and support $66,051  $49,808  $184,469  $140,267 
Subscription license  13,577   10,904   36,804   30,811 
Total recurring revenues  79,628   60,712   221,273   171,078 
Professional services  12,396   8,951   34,981   25,472 
Total revenues  92,024   69,663   256,254   196,550 
Cost of revenues            
SaaS and support  13,644   13,490   38,498   37,007 
Total cost of recurring revenues  13,644   13,490   38,498   37,007 
Professional services  14,846   12,510   42,111   34,922 
Total cost of revenues  28,490   26,000   80,609   71,929 
Gross profit  63,534   43,663   175,645   124,621 
Gross margin  69.0%  62.7%  68.5%  63.4%
Operating expenses:            
Research and development  25,281   20,425   68,352   54,781 
Sales and marketing  34,946   28,759   99,796   81,244 
General and administrative  21,552   23,175   62,715   65,222 
Lease modification and impairment        1,601    
Total operating expenses  81,779   72,359   232,464   201,247 
Operating loss  (18,245)  (28,696)  (56,819)  (76,626)
Loss on debt extinguishment           (2,407)
Interest expense  (39)  (39)  (117)  (236)
Other income (expense), net  (214)  (272)  (719)  188 
Net loss before income taxes  (18,498)  (29,007)  (57,655)  (79,081)
Income tax benefit (expense)  351   271   (300)  990 
Net loss $(18,147) $(28,736) $(57,955) $(78,091)
Net loss per share, basic and diluted $(0.28) $(0.47) $(0.91) $(1.28)
Weighted-average shares used to compute net loss per share, basic and diluted  64,327   61,564   63,487   60,868 
                 

INTAPP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands)

  March 31, 2023  June 30, 2022 
Assets      
Current assets:      
Cash and cash equivalents $53,159  $50,783 
Restricted cash  807   3,528 
Accounts receivable, net of allowance for doubtful accounts of $1,734 and $918 as of March 31, 2023 and June 30, 2022, respectively  68,397   66,947 
Unbilled receivables, net  12,642   6,763 
Other receivables, net  1,158   3,199 
Prepaid expenses  8,637   5,984 
Deferred commissions, current  11,240   10,187 
Total current assets  156,040   147,391 
Property and equipment, net  15,495   12,283 
Operating lease right-of-use assets  15,784    
Goodwill  270,043   269,103 
Intangible assets, net  40,338   48,430 
Deferred commissions, noncurrent  15,818   14,755 
Other assets  1,828   2,451 
Total assets $515,346  $494,413 
Liabilities and Stockholders’ Equity      
Current liabilities:      
Accounts payable $4,697  $4,220 
Accrued compensation  33,824   40,004 
Accrued expenses  9,749   8,774 
Deferred revenue, net  165,885   142,768 
Other current liabilities  13,095   27,753 
Total current liabilities  227,250   223,519 
Deferred tax liabilities  1,647   2,099 
Deferred revenue, noncurrent  1,852   2,712 
Operating lease liabilities, noncurrent  16,172    
Other liabilities  3,530   10,201 
Total liabilities  250,451   238,531 
Stockholders’ equity:      
Preferred stock      
Common stock  65   63 
Additional paid-in capital  710,040   643,227 
Accumulated other comprehensive loss  (1,519)  (1,672)
Accumulated deficit  (443,691)  (385,736)
Total stockholders’ equity  264,895   255,882 
Total liabilities and stockholders’ equity $515,346  $494,413 
         

INTAPP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
Cash Flows from Operating Activities:            
Net loss $(18,147) $(28,736) $(57,955) $(78,091)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:            
Depreciation and amortization  3,669   4,354   11,406   12,510 
Amortization of deferred financing costs  38   38   115   75 
Amortization of operating lease right-of-use assets  1,106      3,510    
Provision for doubtful accounts  726   210   1,402   804 
Stock-based compensation  18,759   22,827   54,795   62,295 
Lease modification and impairment        1,601    
Loss on debt extinguishment           2,407 
Change in fair value of contingent consideration, including unrealized foreign exchange gain  (641)  125   (873)  (364)
Payment of contingent consideration in excess of acquisition date fair value     (279)     (279)
Deferred income taxes  (148)  (475)  (452)  (1,084)
Other     (7)     32 
Changes in operating assets and liabilities:            
Accounts receivable  (856)  (6,596)  (2,370)  557 
Unbilled receivables, current  (3,489)  (1,633)  (5,879)  (1,694)
Prepaid expenses and other assets  (815)  (750)  214   782 
Deferred commissions  (560)  (606)  (2,116)  (3,962)
Accounts payable and accrued liabilities  2,622   5,786   (5,472)  2,108 
Deferred revenue, net  3,484   3,503   22,257   13,525 
Operating lease liabilities  (1,471)     (4,594)   
Other liabilities  (790)  284   1,245   (5,051)
  Net cash provided by (used in) operating activities  3,487   (1,955)  16,834   4,570 
Cash Flows from Investing Activities:            
Purchases of property and equipment  (356)  (165)  (2,054)  (281)
Capitalized internal-use software costs  (1,179)  (1,114)  (3,876)  (3,052)
Investment in note receivable  (500)     (500)   
  Net cash used in investing activities  (2,035)  (1,279)  (6,430)  (3,333)
Cash Flows from Financing Activities:            
Payments on borrowings           (278,000)
Proceeds from initial public offering, net of underwriting discounts           292,758 
Payments for deferred offering costs  (57)     (57)  (4,358)
Proceeds from stock option exercises  11,247   4,187   15,727   8,070 
Proceeds from employee stock purchase plan        1,241    
Payments related to tax withholding for vested equity awards     (3,913)  (4,948)  (3,913)
Payments of deferred contingent consideration and holdback associated with acquisitions  (11,175)  (10,435)  (22,290)  (10,435)
Payment of deferred financing costs           (769)
  Net cash provided by (used in) financing activities  15   (10,161)  (10,327)  3,353 
Effect of foreign currency exchange rate changes on cash and cash equivalents  (71)  (143)  (422)  160 
  Net increase (decrease) in cash, cash equivalents and restricted cash  1,396   (13,538)  (345)  4,750 
Cash, cash equivalents and restricted cash - beginning of period  52,570   59,751   54,311   41,463 
Cash, cash equivalents and restricted cash - end of period $53,966  $46,213  $53,966  $46,213 
                 

INTAPP, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Unaudited, in thousands, except per share data and percentages)

The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP financial measures for the periods indicated below:

Non-GAAP Gross Profit

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
GAAP gross profit $63,534  $43,663  $175,645  $124,621 
Adjusted to exclude the following:            
Stock-based compensation  1,524   1,228   4,248   3,166 
Amortization of intangible assets  918   1,964   3,331   5,891 
Non-GAAP gross profit $65,976  $46,855  $183,224  $133,678 
Non-GAAP gross margin  71.7%  67.3%  71.5%  68.0%
                 

Non-GAAP Operating Expenses

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
Research and development $25,281  $20,425  $68,352  $54,781 
Stock-based compensation  (4,571)  (5,136)  (11,351)  (13,771)
Non-GAAP research and development $20,710  $15,289  $57,001  $41,010 
             
             
Sales and marketing $34,946  $28,759  $99,796  $81,244 
Stock-based compensation  (6,029)  (7,330)  (18,134)  (20,687)
Amortization of intangible assets  (1,467)  (1,448)  (4,398)  (3,927)
Non-GAAP sales and marketing $27,450  $19,981  $77,264  $56,630 
             
             
General and administrative $21,552  $23,175  $62,715  $65,222 
Stock-based compensation  (6,635)  (9,133)  (21,062)  (24,671)
Amortization of intangible assets  (120)  (106)  (363)  (319)
Change in fair value of contingent consideration  641      873   (727)
Acquisition-related transaction costs  (502)  (125)  (703)  (206)
Non-GAAP general and administrative $14,936  $13,811  $41,460  $39,299 
                 

Non-GAAP Operating Profit (Loss)

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
GAAP operating loss $(18,245) $(28,696) $(56,819) $(76,626)
Adjusted to exclude the following:            
Stock-based compensation  18,759   22,827   54,795   62,295 
Amortization of intangible assets  2,505   3,518   8,092   10,137 
Lease modification and impairment        1,601    
Change in fair value of contingent consideration  (641)     (873)  727 
Acquisition-related transaction costs  502   125   703   206 
Non-GAAP operating profit (loss) $2,880  $(2,226) $7,499  $(3,261)
                 

Non-GAAP Net Income (Loss)

  Three Months Ended March 31,  Nine Months Ended March 31, 
  2023  2022  2023  2022 
GAAP net loss $(18,147) $(28,736) $(57,955) $(78,091)
Adjusted to exclude the following:            
Stock-based compensation  18,759   22,827   54,795   62,295 
Amortization of intangible assets  2,505   3,518   8,092   10,137 
Lease modification and impairment        1,601    
Change in fair value of contingent consideration  (641)     (873)  727 
Acquisition-related transaction costs  502   125   703   206 
Income tax effect of non-GAAP adjustments (1)  (761)     (1,242)   
Non-GAAP net income (loss) $2,217  $(2,266) $5,121  $(4,726)
             
GAAP net loss per share, basic and diluted $(0.28) $(0.47) $(0.91) $(1.28)
Non-GAAP net income (loss) per share, diluted $0.03  $(0.04) $0.07  $(0.08)
             
             
Weighted-average shares used to compute GAAP net loss per share, basic and diluted  64,327   61,564   63,487   60,868 
Weighted-average shares used to compute non-GAAP net income (loss) per share, diluted  76,306   61,564   72,125   60,868 

(1) The income tax effect of non-GAAP adjustments for the three and nine months ended March 31, 2022 were immaterial.


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