Press release

Asana Announces Record First Quarter Fiscal 2022 Revenues

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Asana, Inc. (NYSE: ASAN), a leading work management platform for teams, today reported financial results for its first quarter fiscal 2022 ended April 30, 2021.

“We are very pleased with the momentum in our first quarter. We reported accelerated revenue growth of 61 percent year over year, we closed large expansions within our existing base and continued to see momentum with some of our largest enterprise customers,” said Dustin Moskovitz, co-founder and chief executive officer of Asana. “Whether teams are fully remote and working from home, or in offices coordinating work across departments and geographies, clarity on who is doing what by when is essential. More and more customers are turning to Asana and the Asana Work Graph to provide a scalable, cross-functional, and easy-to-adopt solution.”

First Quarter Fiscal 2022 Financial Highlights

  • Revenues: Revenues were $76.7 million, an increase of 61% year over year.
  • Operating Loss: GAAP operating loss was $50.0 million, or 65% of revenues, compared to GAAP operating loss of $29.1 million, or 61% of revenues, in the first quarter of fiscal 2021. Non-GAAP operating loss was $33.3 million, or 43% of revenues, compared to non-GAAP operating loss of $23.9 million, or 50% of revenues, in the first quarter of fiscal 2021.
  • Net Loss: GAAP net loss was $60.7 million, compared to GAAP net loss of $35.8 million in the first quarter of fiscal 2021. GAAP net loss per share was $0.37, compared to GAAP net loss per share of $0.47 in the first quarter of fiscal 2021. Non-GAAP net loss was $33.8 million, compared to non-GAAP net loss of $23.7 million in the first quarter of fiscal 2021. Non-GAAP net loss per share was $0.21, compared to non-GAAP net loss per share of $0.31 in the first quarter of fiscal 2021.
  • Cash Flow: Cash flows from operating activities were negative $7.4 million, compared to negative $18.2 million in the first quarter of fiscal 2021. Free cash flow was negative $7.7 million, compared to negative $17.1 million in the first quarter of fiscal 2021.

Business Highlights

  • Announced the availability of Universal Reporting which gives leaders real-time visibility into work across their organization.
  • Introduced Asana Partners, featuring over 200 Technology Partners including new Zendesk, ServiceNow, Adobe, Canva, InVision, Looker and Lucidchart integrations.
  • Launched Asana’s Channel Partner network across 75 countries.
  • Expanded with four new languages – Traditional Chinese, Russian, Dutch, and Polish, with three more languages coming soon.
  • Named to Inc. Magazine’s annual list of Best Workplaces for the fourth year in a row.
  • Ended the quarter with over 100,000 paying customers.
  • The number of customers spending $5,000 or more on an annualized basis grew to 11,272, an increase of 53% year over year.
  • The number of customers spending $50,000 or more on an annualized basis grew to 485, an increase of 92% year over year.
  • Overall dollar-based net retention rate was over 115%.
  • Dollar-based net retention rate for customers with $5,000 or more in annualized spend was 123%.
  • Dollar-based net retention rate for customers with $50,000 or more in annualized spend was over 140%.

Financial Outlook

For the second quarter of fiscal 2022, Asana expects:

  • Revenues of $81.0 million to $83.0 million, representing year over year growth of 56% to 60%.
  • Non-GAAP operating loss of $44.0 million to $42.0 million.
  • Non-GAAP net loss per share of $0.27 to $0.26, assuming basic and diluted weighted average shares outstanding of approximately 163 million.

For fiscal year 2022, Asana expects revenues of $336.0 million to $340.0 million, representing year over year growth of 48% to 50%.

These statements are forward-looking and actual results may materially differ. Refer to the “Forward-Looking Statements” section below for information on the factors that could cause Asana’s actual results to materially differ from these forward-looking statements.

A reconciliation of non-GAAP outlook measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, many of these costs and expenses that may be incurred in the future. Asana has provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for its first quarter fiscal 2022 non-GAAP results included in this press release.

Earnings Conference Call Information

Asana will hold a conference call and live webcast today to discuss these results at 1:30 p.m. Pacific Time. A live and replay webcast will be available on the Asana Investor Relations website at: https://investors.asana.com.

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include, but are not limited to, statements about Asana’s outlook for the second fiscal quarter and the full fiscal year ending January 31, 2022, Asana’s market position, and potential market opportunities. Forward-looking statements generally relate to future events or Asana’s future financial or operating performance. Forward-looking statements include all statements that are not historical facts and in some cases can be identified by terms such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “continue,” “could,” “potential,” “remain,” “may,” “might,” “will,” “would” or similar expressions and the negatives of those terms. However, not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including factors beyond Asana’s control, that may cause Asana’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to, risks and uncertainties related to: Asana’s ability to achieve future growth and sustain its growth rate, Asana’s ability to attract and retain customers and increase sales to its customers, Asana’s ability to develop and release new products and services and to scale its platform, Asana’s ability to increase adoption of its platform through Asana’s self-service model, Asana’s ability to maintain and grow its relationships with strategic partners, the highly competitive and rapidly evolving market in which Asana participates, Asana’s international expansion strategies, and the impact of the COVID-19 pandemic. Further information on risks that could cause actual results to differ materially from forecasted results are included in Asana’s filings with the SEC, including Asana’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021. Any forward-looking statements contained in this press release are based on assumptions that Asana believes to be reasonable as of this date. Except as required by law, Asana assumes no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Use of Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, Asana uses certain non-GAAP financial measures to understand and evaluate its core operating performance. In this release, Asana’s non-GAAP gross profit, gross margin, operating expenses, operating expenses as a percentage of revenue, operating loss, operating margin, net loss, net loss per share, free cash flow are not presented in accordance with GAAP and are not intended to be used in lieu of GAAP presentations of results of operations. These non-GAAP financial measures, which may be different from similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of Asana’s financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures can be found in the accompanying financial statements included with this press release.

Asana believes that these non-GAAP financial measures provide useful information about its financial performance, enhance the overall understanding of Asana’s past performance and future prospects, facilitate period-to-period comparisons of operations, and allow for greater transparency with respect to important metrics used by Asana’s management for financial and operational decision-making. Asana is presenting these non-GAAP financial metrics to assist investors in seeing its financial performance through the eyes of management, and because Asana believes that these measures provide an additional tool for investors to use in comparing its core financial performance over multiple periods with other companies in Asana’s industry.

Asana believes excluding the following items from the GAAP Condensed Consolidated Statements of Operations is useful to investors and others in assessing Asana’s operating performance due to the following factors:

  • Share-based compensation expenses. Although share-based compensation is an important aspect of the compensation of our employees and executives, management believes it is useful to exclude share-based compensation expenses to better understand the long-term performance of our core business and to facilitate comparison of our results to those of peer companies.
  • Employer payroll tax associated with RSUs. The amount of employer payroll tax-related items on employee stock transactions is dependent on Asana’s stock price and other factors that are beyond its control and that do not correlate to the operation of the business.
  • Non-cash and non-recurring expenses. Non-cash expenses include the amortization of debt discount and non-cash interest related to the outstanding senior mandatory convertible promissory notes and non-recurring expenses include direct listing fees. Asana believes the exclusion of the non-cash and non-recurring items provides useful supplemental information to investors and facilitates the analysis of our operation results and comparison of operating results across reporting periods.

Asana also uses the non-GAAP financial measure of free cash flow, which is defined as net cash used in operating activities less cash used for purchases of property and equipment and capitalized internal-use software costs, plus non-recurring expenditures such as capital expenditures from the purchases of property and equipment associated with the build-out of Asana’s corporate headquarters in San Francisco and direct listing expenses. Asana believes free cash flow is an important liquidity measure of the cash that is available, after capital expenditures and operational expenses, for investment in its business and to make acquisitions. Free cash flow is useful to investors as a liquidity measure because it measures Asana’s ability to generate or use cash. There are a number of limitations related to the use of free cash flow as compared to net cash from operating activities, including that free cash flow includes capital expenditures, the benefits of which are realized in periods subsequent to those when expenditures are made.

Definitions of Business Metrics

Customers spending over $5,000 and $50,000

We define customers spending over $5,000 and $50,000 as those organizations on a paid subscription plan that had $5,000 or more or $50,000 or more in annualized GAAP revenues in a given quarter, respectively, inclusive of discounts.

Dollar-based net retention rate

Asana’s reported dollar-based net retention rate equals the simple arithmetic average of its quarterly dollar-based net retention rate for the four quarters ending with the most recent fiscal quarter. Asana calculates its dollar-based net retention rate by comparing its revenues from the same set of customers in a given quarter, relative to the comparable prior-year period. To calculate Asana’s dollar-based net retention rate for a given quarter, Asana starts with the revenues in that quarter from customers that generated revenues in the same quarter of the prior year. Asana then divides that amount by the revenues attributable to that same group of customers in the prior-year quarter. Current period revenues include any upsells and are net of contraction or attrition over the trailing 12 months, but exclude revenues from new customers in the current period. Asana expects its dollar-based net retention rate to fluctuate in future periods due to a number of factors, including the expected growth of its revenue base, the level of penetration within its customer base, and its ability to retain its customers.

About Asana

Asana helps teams orchestrate their work, from small projects to strategic initiatives. Headquartered in San Francisco, CA, Asana has more than 100,000 paying customers and millions of free organizations across 190 countries. Global customers such as Amazon, Japan Airlines, Sky, and Under Armour rely on Asana to manage everything from company objectives to digital transformation to product launches and marketing campaigns. For more information, visit www.asana.com.

Disclosure of Material Information

Asana announces material information to its investors using SEC filings, press releases, public conference calls, and on its investor relations page of Asana’s website at https://investors.asana.com. Asana uses these channels, as well as social media, including its Twitter account (@asana), its blog (blog.asana.com), its LinkedIn page (www.linkedin.com/company/asana), its Instagram account (@asana), and its Facebook page (www.facebook.com/asana/), to communicate with investors and the public about Asana, its products and services and other matters. Therefore, Asana encourages investors, the media and others interested in Asana to review the information it makes public in these locations, as such information could be deemed to be material information.

ASANA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)

 

 

 

Three Months Ended April 30,

 

 

2021

 

2020

Revenues

 

$

76,673

 

 

$

47,706

 

Cost of revenues(1)

 

7,914

 

 

6,206

 

Gross profit

 

68,759

 

 

41,500

 

Operating expenses:

 

 

 

 

Research and development(1)

 

39,967

 

 

22,383

 

Sales and marketing(1)

 

56,784

 

 

36,091

 

General and administrative(1)

 

21,990

 

 

12,111

 

Total operating expenses

 

118,741

 

 

70,585

 

Loss from operations

 

(49,982)

 

 

(29,085)

 

Interest income and other income, net

 

8

 

 

354

 

Interest expense

 

(10,374)

 

 

(6,991)

 

Loss before provision for income taxes

 

(60,348)

 

 

(35,722)

 

Provision for income taxes

 

310

 

 

123

 

Net loss

 

$

(60,658)

 

 

$

(35,845)

 

Net loss per share:

 

 

 

 

Basic and diluted

 

$

(0.37)

 

 

$

(0.47)

 

Weighted-average shares used in calculating net loss per share:

 

 

 

 

Basic and diluted

 

162,079

 

 

75,641

 

_______________

(1) Amounts include stock-based compensation expense as follows:

 

 

Three Months Ended April 30,

 

 

2021

 

2020

Cost of revenues

 

$

120

 

 

$

46

 

Research and development

 

9,140

 

 

2,081

 

Sales and marketing

 

4,153

 

 

1,099

 

General and administrative

 

2,618

 

 

756

 

Total stock-based compensation expense

 

$

16,031

 

 

$

3,982

 

ASANA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

 

 

 

April 30, 2021

 

January 31, 2021

Assets

 

 

 

 

Current assets

 

 

 

 

Cash and cash equivalents

 

$

263,933

 

 

$

259,878

 

Marketable securities

 

122,374

 

 

126,396

 

Accounts receivable, net

 

37,344

 

 

32,194

 

Prepaid expenses and other current assets

 

25,904

 

 

27,295

 

Total current assets

 

449,555

 

 

445,763

 

Property and equipment, net

 

94,138

 

 

74,436

 

Operating lease right-of-use assets

 

181,093

 

 

182,924

 

Investments, noncurrent

 

12,099

 

 

19,125

 

Other assets

 

10,708

 

 

8,871

 

Total assets

 

$

747,593

 

 

$

731,119

 

Liabilities and Stockholders’ (Deficit) Equity

Current liabilities

 

 

 

 

Accounts payable

 

$

8,947

 

 

$

9,599

 

Accrued expenses and other current liabilities

 

46,535

 

 

41,616

 

Deferred revenue, current (1)

 

122,884

 

 

103,875

 

Operating lease liabilities, current

 

6,742

 

 

8,386

 

Total current liabilities

 

185,108

 

 

163,476

 

Term loan, net

 

37,599

 

 

29,508

 

Convertible notes, net—related party

 

361,337

 

 

351,161

 

Operating lease liabilities, noncurrent

 

207,511

 

 

196,802

 

Other liabilities(1)

 

3,737

 

 

2,961

 

Total liabilities

 

795,292

 

 

743,908

 

Stockholders’ (deficit) equity

 

 

 

 

Common stock

 

2

 

 

2

 

Additional paid-in capital

 

554,340

 

 

528,616

 

Accumulated other comprehensive income

 

63

 

 

39

 

Accumulated deficit

 

(602,104)

 

 

(541,446)

 

Total stockholders’ (deficit) equity

 

(47,699)

 

 

(12,789)

 

Total liabilities, redeemable convertible preferred stock, and stockholders’ (deficit) equity

 

$

747,593

 

 

$

731,119

 

_______________

(1)

Total deferred revenue was $125.9 million and $105.9 million as of April 30, 2021 and January 31, 2021, respectively, of which $3.0 million and $2.0 million, respectively, is presented within other liabilities, as a noncurrent liability, in the consolidated balance sheets.

ASANA, INC.

SUMMARY OF CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

 

 

Three Months Ended April 30,

 

2021

 

2020

Cash flows from operating activities

 

 

 

Net loss

$

(60,658)

 

 

$

(35,845)

 

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

Allowance for doubtful accounts

196

 

 

383

 

Depreciation and amortization

973

 

 

743

 

Amortization of deferred contract acquisition costs

1,629

 

 

711

 

Stock-based compensation expense

16,031

 

 

3,982

 

Net accretion of discount of marketable securities

336

 

 

(48)

 

Non-cash lease expense

4,526

 

 

2,962

 

Amortization of discount on convertible notes and term loan issuance costs

6,251

 

 

4,402

 

Non-cash interest expense

3,930

 

 

2,589

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable

(3,182)

 

 

(2,877)

 

Prepaid expenses and other current assets

(2,383)

 

 

(1,081)

 

Other assets

(1,858)

 

 

(528)

 

Accounts payable

(2,451)

 

 

3,135

 

Accrued expenses and other current liabilities

2,827

 

 

296

 

Deferred revenue

20,025

 

 

6,036

 

Operating lease liabilities

6,364

 

 

(3,014)

 

Net cash used in operating activities

(7,444)

 

 

(18,154)

 

Cash flows from investing activities

 

 

 

Purchases of marketable securities

(34,002)

 

 

 

Sales of marketable securities

351

 

 

 

Maturities of marketable securities

44,352

 

 

29,399

 

Purchases of property and equipment

(16,969)

 

 

(2,081)

 

Capitalized internal-use software

(183)

 

 

(461)

 

Net cash provided by (used in) investing activities

(6,451)

 

 

26,857

 

Cash flows from financing activities

 

 

 

Proceeds from term loan, net of issuance costs

9,000

 

 

 

Repayment of term loan

(167)

 

 

 

Repurchases of common stock

(13)

 

 

(66)

 

Proceeds from exercise of stock options

2,974

 

 

969

 

Proceeds from employee stock purchase plan

6,127

 

 

 

Net cash provided by financing activities

17,921

 

 

903

 

Effect of foreign exchange rates on cash and cash equivalents and restricted cash

29

 

 

(31)

 

Net increase in cash, cash equivalents, and restricted cash

4,055

 

 

9,575

 

Cash, cash equivalents, and restricted cash

 

 

 

Beginning of period

259,878

 

 

310,677

 

End of period

$

263,933

 

 

$

320,252

 

ASANA, INC.

Reconciliation of GAAP to Non-GAAP Data

(In thousands, except percentages)

(unaudited)

 

 

 

Three Months Ended April 30,

 

 

2021

 

2020

Reconciliation of gross profit and gross margin

 

 

 

 

GAAP gross profit

 

$

68,759

 

 

$

41,500

 

Plus: stock-based compensation and related employer payroll tax associated with RSUs

 

123

 

 

46

 

Non-GAAP gross profit

 

$

68,882

 

 

$

41,546

 

GAAP gross margin

 

89.7

%

 

87.0

%

Non-GAAP adjustments

 

0.1

%

 

0.1

%

Non-GAAP gross margin

 

89.8

%

 

87.1

%

Reconciliation of operating expenses

 

 

 

 

GAAP research and development

 

$

39,967

 

 

$

22,383

 

Less: stock-based compensation and related employer payroll tax associated with RSUs

 

(9,498)

 

 

(2,081)

 

Non-GAAP research and development

 

$

30,469

 

 

$

20,302

 

GAAP research and development as percentage of revenue

 

52.1

%

 

46.9

%

Non-GAAP research and development as percentage of revenue

 

39.7

%

 

42.6

%

 

 

 

 

 

GAAP sales and marketing

 

$

56,784

 

 

$

36,091

 

Less: stock-based compensation and related employer payroll tax associated with RSUs

 

(4,323)

 

 

(1,099)

 

Non-GAAP sales and marketing

 

$

52,461

 

 

$

34,992

 

GAAP sales and marketing as percentage of revenue

 

74.1

%

 

75.7

%

Non-GAAP sales and marketing as percentage of revenue

 

68.4

%

 

73.3

%

 

 

 

 

 

GAAP general and administrative

 

$

21,990

 

 

$

12,111

 

Less: stock-based compensation and related employer payroll tax associated with RSUs

 

(2,735)

 

 

(756)

 

Less: direct listing expenses

 

 

 

(1,186)

 

Non-GAAP general and administrative

 

$

19,255

 

 

$

10,169

 

GAAP general and administrative as percentage of revenue

 

28.7

%

 

25.4

%

Non-GAAP general and administrative as percentage of revenue

 

25.1

%

 

21.3

%

Reconciliation of operating loss and operating margin

 

 

 

 

GAAP loss from operations

 

$

(49,982)

 

 

$

(29,085)

 

Plus: stock-based compensation and related employer payroll tax associated with RSUs

 

16,679

 

 

3,982

 

Plus: direct listing expenses

 

 

 

1,186

 

Non-GAAP loss from operations

 

$

(33,303)

 

 

$

(23,917)

 

GAAP operating margin

 

(65.2)

%

 

(61.0)

%

Non-GAAP adjustments

 

21.8

%

 

10.9

%

Non-GAAP operating margin

 

(43.4)

%

 

(50.1)

%

ASANA, INC.

Reconciliation of GAAP to Non-GAAP Data

(In thousands, except percentages and per share data)

(unaudited)

 

 

 

Three Months Ended April 30,

 

 

2021

 

2020

Reconciliation of net loss

 

 

 

 

GAAP net loss

 

$

(60,658)

 

 

$

(35,845)

 

Plus: stock-based compensation and related employer payroll tax associated with RSUs

 

16,679

 

 

3,982

 

Plus: amortization of debt discount

 

6,246

 

 

4,402

 

Plus: non-cash interest

 

3,930

 

 

2,589

 

Plus: direct listing expenses

 

 

 

1,186

 

Non-GAAP net loss

 

$

(33,803)

 

 

$

(23,686)

 

Reconciliation of net loss per share

 

 

 

 

GAAP net loss per share, basic

 

$

(0.37)

 

 

$

(0.47)

 

Non-GAAP adjustments to net loss

 

0.16

 

 

0.16

 

Non-GAAP net loss per share, basic

 

$

(0.21)

 

 

$

(0.31)

 

Weighted-average shares used in GAAP and non-GAAP per share calculation, basic and diluted

 

162,079

 

 

75,641

 

 

 

 

Three Months Ended April 30,

 

 

2021

 

2020

Computation of free cash flow

 

 

 

 

Net cash provided by (used in) investing activities

 

$

(6,451)

 

 

$

26,857

 

Net cash provided by financing activities

 

$

17,921

 

 

$

903

 

Net cash used in operating activities

 

$

(7,444)

 

 

$

(18,154)

 

Less: purchases of property and equipment

 

(16,969)

 

 

(2,081)

 

Less: capitalized internal-use software

 

(183)

 

 

(461)

 

Plus: purchases of property and equipment from build-out of corporate headquarters

 

16,662

 

 

1,658

 

Plus: direct listing expenses

 

270

 

 

1,975

 

Free cash flow

 

$

(7,664)

 

 

$

(17,063)