Procore Announces Strong Second Quarter 2021 Financial Results
Revenue Accelerates to 27% Year-Over-Year Growth
CARPINTERIA, CA., August 5, 2021 — Procore Technologies, Inc. (NYSE: PCOR), a leading provider of construction management software, today announced financial results for the second quarter ended June 30, 2021.
“Procore delivered record results in our first quarter as a public company,” said Tooey Courtemanche, Founder, President and CEO of Procore. “Our performance is a testament to our dedication to the construction industry, and the trust it has in us as a partner. Our commitment to this industry has always been, and will remain, core to who we are as we continue pursuing our vision of improving the lives of everyone in construction.”
“We are pleased with our performance in Q2 as we saw growth across all aspects of the business,” said Paul Lyandres, CFO of Procore. “We continued to expand our customer base, enter new international markets, and further invest in our products and platform, delivering incremental value to our customers.”
Second Quarter 2021 Financial Highlights:
Revenue was $122.8 million, an increase of 27% year-over-year.
GAAP gross margin was 79% and non-GAAP gross margin was 84%.
GAAP operating margin was (121%) and non-GAAP operating margin was (4%).
Operating cash outflow for the second quarter was $3.1 million.
Successfully completed our initial public offering on May 24, 2021, selling 10.41 million shares at $67 per share and raising total proceeds of $665.1 million net of underwriting discounts and commissions.
Non-GAAP gross margin and non-GAAP operating margin are non-GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release.
Second Quarter 2021 Business Highlights:
Added 481 net new customers in the second quarter, ending with a total of 11,149 customers.
Announced product enhancements to our Financial Management portfolio.
Announced an enhanced Preconstruction solution during Procore’s Innovation Summit.
Awarded top honors for five key categories in the G2 2021 Summer Report.
Acquired INDUS.AI, an artificial intelligence-powered analytics platform.
Third Quarter and Full Year 2021 Outlook:
Procore is providing the following guidance for the third quarter and full year 2021:
Third Quarter 2021 Outlook:
Revenue is expected to be in the range of $125 million to $127 million.
Non-GAAP operating margin is expected to be in the range of (7%) to (8%).
Full Year 2021 Outlook:
Revenue is expected to be in the range of $496 million to $499 million.
Non-GAAP operating margin is expected to be in the range of (6%) to (7%).
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 and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Procore’s future GAAP financial results.
Quarterly Conference Call
Procore Technologies, Inc. will hold a conference call to discuss its second quarter results at 3:00 p.m., Pacific Time, on Thursday, August 5, 2021. A live audio webcast will be accessible on Procore's investor relations website at http://investors.procore.com.
Forward-Looking Statements
Statements Procore makes in this press release may include statements which are not historical facts and are considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, which are usually identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” "outlook", “seeks,” “should,” “will,” and variations of such words or similar expressions.
Procore intends these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are making this statement for purposes of complying with those safe harbor provisions.
This press release contains forward-looking statements about Procore and its industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this press release, including, but not limited to, statements regarding the expected performance of Procore’s business and objectives of management for future operations, are forward-looking statements. Procore has based the forward-looking statements contained in this press release primarily on its current expectations and projections about future events and trends that Procore believes may affect its business, financial condition, and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors that could cause results to differ materially from Procore’s current expectations. You should not place undue reliance on Procore’s forward-looking statements. Procore assumes no obligation to update any forward-looking statements to reflect events or circumstances that exist or change after the date on which they were made, except as required by law.
Non-GAAP Financial Measures
Procore believes that the use of non-GAAP gross margin and non-GAAP operating margin is helpful to its investors. These measures, which are referred to as non-GAAP financial measures, are not prepared in accordance with U.S. generally accepted accounting principles, or GAAP. Non-GAAP gross profit and non-GAAP gross margin are defined as gross profit and gross margin, respectively, excluding stock-based compensation expense, amortization of acquired technology intangible assets, and employer payroll tax related to employee stock transactions. Non-GAAP gross margin is the ratio calculated by dividing non-GAAP gross profit by total revenue. Non-GAAP income (loss) from operations and non-GAAP operating margin are defined as GAAP loss from operations and GAAP operating margin, respectively, excluding stock-based compensation expense, amortization of acquired intangible assets, and employer payroll tax related to employee stock transactions. Non-GAAP operating margin is the ratio calculated by dividing non-GAAP income (loss) from operations by total revenue.
Because of varying available valuation methodologies, subjective assumptions, and the variety of equity instruments that can impact a company's non-cash expenses, Procore believes that providing non-GAAP financial measures that exclude stock-based compensation expense allow for meaningful comparisons between its operating results from period to period. The expense related to amortization of acquired intangible assets is dependent upon estimates and assumptions, which can vary significantly and are unique to each asset acquired; therefore, Procore believes non-GAAP measures that adjust for the amortization of acquired intangible assets provide investors a consistent basis for comparison across accounting periods. The amount of employer payroll tax-related items on employee stock transactions is dependent on restricted stock unit settlements, option exercises, related stock price, and other factors that are beyond Procore’s control and that do not correlate to the operation of the business. When evaluating the performance of its business and making operating plans, Procore does not consider these items (for example, when considering the impact of equity award grants, the company places a greater emphasis on overall stockholder dilution than the accounting charges associated with such grants). Procore believes it is useful to exclude these expenses in order to better understand the long-term performance of its core business and to facilitate comparison of its results period-over-period and to those of peer companies. All of these non-GAAP financial measures are important tools for financial and operational decision-making and for evaluating Procore's own operating results over different periods of time.
Non-GAAP financial measures may not provide information that is directly comparable to information provided by other companies in Procore's industry, as other companies in the industry may calculate non-GAAP financial measures differently. In addition, there are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies, and exclude expenses that may have a material impact on Procore's reported financial results. Further, stock-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in Procore's business and an important part of the compensation provided to its employees. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Investors should review the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate Procore's business.
Download Financial Statements PDF
About Procore
Procore is a leading provider of construction management software. Over 1 million projects and more than $1 trillion USD in construction volume have run on Procore's platform. Procore’s platform connects key project stakeholders to solutions Procore has built specifically for the construction industry—for the owner, the general contractor, and the specialty contractor. Procore's App Marketplace has a multitude of partner solutions that integrate seamlessly with Procore’s platform, giving construction professionals the freedom to connect with what works best for them. Headquartered in Carpinteria, California, Procore has offices around the globe. Learn more at Procore.com.