Appian (APPN) Q3 2024 earnings summary

Executive summary

• Cloud subscription revenue grew 22% year-over-year to $94.1 million in Q3 2024, driving total revenue up 12% to $154.1 million.

• Adjusted EBITDA was $10.8 million, a significant improvement from a $5.3 million loss a year ago, and the company now expects positive adjusted EBITDA for the full year.

• Net loss narrowed to $2.1 million from $22.3 million in Q3 2023, with non-GAAP net income of $11.4 million versus a $14.6 million loss.

• Subscriptions revenue accounted for 80% of total revenue, up from 76% YoY, as the company continues to shift toward a recurring revenue model.

• International operations contributed 36% of total revenue, reflecting ongoing global expansion.

Financial highlights

• Total subscriptions revenue rose 19% year-over-year to $123.1 million; professional services revenue declined 7% to $30.9 million.

• Non-GAAP gross margin was 77%, with subscription gross margin at 89% and professional services at 30%.

• Cash, cash equivalents, and investments totaled $140 million at quarter end; working capital was $62 million.

• Cash used by operating activities was $8.2 million in Q3 2024, a major improvement from $65 million YoY.

• Deferred revenue reached $227.6 million, up 15% year-over-year.

Outlook and guidance

• Q4 2024 cloud subscription revenue expected between $95–$97 million (+14–17% YoY); total revenue expected between $163.5–$165.5 million (+13–14% YoY).

• Q4 adjusted EBITDA expected between $6–$8 million; non-GAAP net loss per share between $0.03 and breakeven.

• Full-year 2024 cloud subscription revenue guidance raised to $364–$366 million (+20% YoY); total revenue guidance raised to $613–$615 million (+12–13% YoY).

• Full-year adjusted EBITDA expected between $5–$7 million; non-GAAP net loss per share between $0.38 and $0.35.