Press Release

UserTesting Reports Second Quarter 2022 Financial Results

Record Second Quarter Revenue of $47.6 million, up 36% year-over-year

San Francisco, August 4, 2022, UserTesting, Inc. (NYSE: USER), a leader in video-based human insight, today announced financial results for the second quarter ended June 30, 2022.

“The second quarter represented our sixth consecutive quarter of year-over-year subscription growth over 40%, with record total revenue of $48 million, up 36% year-over-year,” said Andy MacMillan, CEO of UserTesting. “While we are prudently managing our expense structure in the near-term given the uncertain economic outlook, we firmly believe the mid to long-term opportunities for our business remain robust as our Human Insight Platform fundamentally helps companies better understand the driving forces behind customer behavior and delivers actionable insights to make smarter and faster business decisions.”

Second Quarter 2022 Financial Highlights:

        Revenue: Total revenue was $47.6 million, up 36% year-over-year. Subscription revenue was $45.2 million, up 40% year-over-year.

        Operating Loss and Margin: GAAP operating loss was $(18.7) million, or (39)% of total revenue, compared to $(11.5) million, or (33)% of total revenue, in the same period last year. Non-GAAP operating loss was $(10.6) million, or (22)% of total revenue, compared to $(10.0) million, or (29)% of total revenue, in the same period last year.

        Net Loss: GAAP net loss was $(18.7) million, or $(0.13) per share, compared to $(11.7) million, or $(0.63) per share, in the same period last year. Non-GAAP net loss was $(10.6) million, or $(0.07) per share, compared to $(10.2) million, or $(0.55) per share, in the same period last year.

        Cash Flow: Net cash used in operations was $(1.3) million, compared to $(8.0) million in the same period last year. Free cash flow was $(1.6) million, compared to $(8.5) million in the same period last year.

        Cash and Cash Equivalents: Cash and cash equivalents were $164.4 million as of June 30, 2022.

Recent Business Highlights:

      Recent new wins and growth deals included Chase Bank, Minute Media, Pearson, Picsart, Rocket Central, Tailored Brands, Trainline and Woolworths.

      UserTesting named to Inc. Magazine’s Annual List of Best Workplaces for 2022.

      UserTesting brings greater privacy and confidentiality to a growing list of healthcare industry leaders with its new HIPAA compliance certification.

      Introduced new product templates that help companies better understand changing customer perceptions around inflation. 

Financial Outlook:

The following revenue guidance reflects the Company’s demand expectations based on the current global macroeconomic outlook. In anticipation of these headwinds, the Company recently conducted a reduction in force which it expects will reduce the growth rate of operating expenses. As a result, the Company now expects improved operating leverage for the full year, despite the changing macroeconomic impact to revenue.

For the third quarter ending September 30, 2022, UserTesting currently expects:

      Total revenue between $47.5 million and $48.5 million.

      Non-GAAP operating margin between (27.0)% and (29.0)%.

  Non-GAAP net loss per share between $(0.09) and $(0.10) assuming 144.5 million weighted-average shares outstanding.

For the full year ending December 31, 2022, UserTesting currently expects:

      Total revenue between $190.0 million and $193.0 million.

      Non-GAAP operating margin between (23.0)% and (25.0)%.

      Non-GAAP net loss per share between $(0.31) and $(0.33) assuming 144.0 million weighted-average shares outstanding.

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

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP operating loss margin, non-GAAP net loss, non-GAAP net loss per share, free cash flow and free cash flow margin are non-GAAP financial measures. Additional information on UserTesting’s reported results, including a reconciliation of the non-GAAP financial measures to their most comparable GAAP measures, is included in the financial tables below. Our definition for each non-GAAP measure used is provided below, however a limitation of non-GAAP financial measures is that they do not have uniform definitions. Accordingly, our definitions for non-GAAP measures used will likely differ from similarly titled non-GAAP measures used by other companies thereby limiting comparability. In addition, the utility of free cash flow as a measure of our liquidity is limited as it does not represent the total increase or decrease in our cash and cash equivalents balance for a given period.

With regards to the non-GAAP guidance provided above, a reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future, although it is important to note that these factors could be material to UserTesting’s results computed in accordance with GAAP.

A supplemental financial presentation and other information can be accessed through UserTesting’s investor relations website at https://ir.usertesting.com. 

UserTesting Conference Call

UserTesting will host a conference call today on August 4, 2022 to review its second quarter 2022 financial results and to discuss its financial outlook. The call is scheduled to begin at 5:00am Pacific Time (8:00am Eastern Time). Investors are invited to join the webcast by visiting https://ir.usertesting.com/news-events. The webcast will be available live, and a replay will be available following the completion of the live broadcast for approximately 90 days

Media Contact

UserTesting, Inc.
Andy Dear
press@usertesting.com 

About UserTesting

UserTesting is fundamentally changing the way digital products and experiences are built and delivered by helping organizations get insights from customers–from concept to execution. Built on top of a world-class, on-demand sourcing