Cantaloupe Inc., a digital payments and software services company that provides end-to-end technology solutions for the unattended retail market, reported results for the first quarter ending September 30, 2022.
“Our revenue grew 26% year-over-year, including double-digit growth in both transaction and subscription fees,” Ravi Venkatesan, chief executive officer, Cantaloupe, said in the announcement. “Gross margin and adjusted EBITDA were negatively impacted primarily due to one-time migration costs related to our transition to the AWS cloud environment, and procurement of higher priced components to fulfill customer demand. However, this positions us well for growth and profitability for the remainder of the fiscal year.”
First-quarter 2023 key financial results
Revenue of $57.8 million, an increase of 26% year over year. The increase was led by a sixth consecutive quarter of record transaction revenue.
- Transaction fees of $31.3 million, an increase of 18% year over year.
- Subscription fees of $15.8 million, an increase of 11% year over year.
- Equipment sales of $10.7 million, an increase of 108% year over year.
Total dollar volumes of transactions in the first quarter were $639.5 million, an increase of 16% year over year.
Gross margin of 24.5% compared with 32.5% in the prior year quarter.
- Subscription and transaction fees margins of 35.5% compared to 35.9% in the prior year quarter.
- Equipment sales margins of (23.8)% compared to 5.3% in the prior year quarter.
U.S. GAAP net loss applicable to common shares of $8.9 million, or $(0.13) per share, compared to net loss applicable to common shares of $1.6 million, or $(0.02) per share, in the prior year period.
Adjusted EBITDA of $(5.4) million compared to $1.9 million in the prior year period.
First-quarter 2023 business highlights:
Active customers totaled 25,019 at the end of the first quarter of 2023 compared to 20,738 at the end of the first quarter of 2022, an increase of 21%.
Active devices totaled 1.15 million at the end of the first quarter of 2023 compared to 1.11 million at the end of the first quarter of 2022, an increase of 3%.
The company finalized its migration of payment processors to Fiserv, which is expected to deliver future cost savings.
In July 2022, the company migrated its cloud hosting services to Amazon Web Services (AWS) platform. The completion of the migration is a major milestone as the company continues to focus on ensuring it has a reliable, resilient and scalable infrastructure to support its growing network of devices and customers.
Completed the upgrade of the vast majority of non 4G/EMV devices, including most large enterprise clients, as the 12/31/22 upgrade deadline approaches.
Fiscal-year 2023 outlook
For full fiscal year 2023, the company reiterates the following:
Revenue to be between $225 million and $235 million, representing year-over-year growth of 10% to 15%.
- Transaction fees revenue growth is expected to be in the high teens.
- Subscription fees revenue growth is expected to be in the low teens.
- Equipment sales revenue growth is expected to be relatively flat.
U.S. GAAP net income to be between $1 million and $5 million.
Adjusted EBITDA to be between $12 million and $17 million.
Total operating cash flow to be between $10 million and $15 million.