BigCommerce Holdings, Inc. — Q1 2023 Form 10-Q
Reporting period: Three months ended March 31, 2023; compared with Q1 2022. The filing identifies the registrant as BigCommerce Holdings, Inc., not Commerce.Com, Inc.
Business context and performance
BigCommerce operates a single-segment SaaS ecommerce platform serving merchants and their connections to marketplaces, social networks, and point-of-sale systems. It reported 5,828 enterprise accounts at March 31, 2023.
| Metric | Q1 2023 | Q1 2022 |
|---|---|---|
| Revenue | $71.8 million | $66.1 million |
| Gross profit / gross margin | $54.3 million / 75.7% | $48.9 million / 74.1% |
| Operating loss | $23.7 million | $36.2 million |
| Net loss | $22.1 million | $37.0 million |
| Basic and diluted loss per share | $0.30 | $0.51 |
| Cash used in operating activities | $20.8 million | $22.0 million |
Revenue grew 8.6%. Subscription solutions revenue increased 12.1% to $53.8 million, mainly from mid-market and enterprise activity and enterprise retention. Partner and services revenue declined 0.6% to $17.9 million, primarily due to lower technology-partner revenue sharing. Total ARR was $316.7 million, up from $280.4 million a year earlier; subscription ARR was $243.5 million, up from $212.1 million. Enterprise-account ARR was $228.8 million, or 72% of total ARR. Enterprise-account count increased from 5,365 to 5,828.
Financial position and material changes
- At March 31, 2023, cash and cash equivalents were $61.1 million, restricted cash $1.1 million, and marketable securities $221.3 million; combined liquidity was $283.5 million. Cash, cash equivalents, and restricted cash declined $30.8 million during the quarter.
- Total assets were $461.5 million and stockholders’ equity was $34.4 million. Current assets of $362.9 million exceeded current liabilities of $77.4 million.
- Long-term debt, net of issuance costs, was $338.0 million; the notes’ principal balance was $345.0 million. The unsecured convertible notes bear 0.25% interest and mature October 1, 2026.
- Interest income increased to $2.4 million from $0.1 million, largely reflecting reinvestment at higher interest rates. Interest expense remained about $0.7 million.
- Operating expenses fell to $78.0 million from $85.1 million, largely because acquisition-related expenses declined to $4.1 million from $12.7 million. Q1 2023 included $0.4 million of restructuring charges; the prior-year quarter had none. Stock-based compensation rose to $10.5 million from $9.0 million.
- Accounts receivable, net, was $59.0 million, including $20.1 million of unbilled receivables. Deferred revenue was $22.7 million in total. Remaining performance obligations were $155.0 million; the company expected to recognize approximately 56% over the next 12 months.
Outlook, risks, contingencies, and unusual items
Management expects operating losses and negative operating cash flows to continue for full-year 2023, but believes existing cash, cash equivalents, marketable securities, and operating cash flows will fund working-capital and capital-expenditure needs for at least the next 12 months. The filing gives no specific revenue or earnings guidance. Management noted that additional financing may be needed for strategic initiatives and may not be available on acceptable terms.
- A potential Feedonomics acquisition-related payment of up to $32.5 million is due at the second anniversary of closing or earlier upon specified milestones; it may be settled partly or wholly in shares.
- Risks include continued losses and cash use, competition, execution of growth and product plans, international expansion, cybersecurity and regulatory developments, and economic and geopolitical uncertainty, including the conflict in Ukraine and inflation.
- The company reported monitoring financial-sector developments after Silicon Valley Bank’s closure; it said its SVB operating-account balance was less than 1% of cash, cash equivalents, and marketable securities and that it did not believe it had a loss exposure.
- Management reported no pending or threatened legal claims expected to have a material adverse effect and no material changes to previously disclosed risk factors. No material off-balance-sheet arrangements were reported.
- Disclosure controls and procedures were assessed as effective at March 31, 2023; no material change in internal control over financial reporting was reported.
Important facts for investors to verify
- Confirm the registrant identity: this filing is for BigCommerce Holdings, Inc., despite the request metadata naming Commerce.Com, Inc.
- Track revenue growth and its mix, especially subscription growth versus partner and services revenue, alongside ARR and enterprise-account trends.
- Assess the pace of operating cash burn against $283.5 million of reported cash, cash equivalents, restricted cash, and marketable securities, and the company’s 12-month liquidity assessment.
- Review the $345.0 million convertible-note principal, 2026 maturity and conversion terms, and the potential Feedonomics payment and possible share dilution.
- Monitor whether cost reductions support improving margins and losses without impairing growth, product investment, or customer retention.