Huddly (HDLY) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached NOK 39 million, up 18% from Q1 2024 but down 32% year-over-year, with gross margin at 39%.

• Channel sales increased 27% sequentially and 2% year-over-year, now representing 73% of revenue; Americas led growth with a 25% year-over-year increase, supported by the New York sales hub and planned expansion to Austin, TX.

• Strategic partner sales remained flat sequentially and declined sharply year-over-year due to inventory issues.

• U.S. patent granted for Huddly Crew, confirming innovation in AI-driven video conferencing and reinforcing IP protection.

• Strategic review is ongoing, with several interested parties and a conclusion expected within months.

Financial highlights

• Revenue of NOK 39.1 million in Q2 2024, down 32% year-over-year but up 18% sequentially.

• Gross margin for Q2 was 39%, impacted by a one-off price protection expense; underlying margin excluding this was 43%.

• EBITDA was NOK -34.2 million and EBIT was NOK -49.6 million, both lower year-over-year.

• Cash balance at June 30, 2024 was NOK 105 million, down from NOK 154 million at March 31, 2024.

• Cash flow from operations improved to NOK -25 million from NOK -51 million in Q2 2023.

Outlook and guidance

• No financial guidance will be provided going forward due to market volatility; previous guidance repealed.

• Focus remains on increasing revenue, maintaining healthy gross margins, achieving cash flow positivity, and technology innovation.

• Channel growth momentum expected to continue, supported by new sales hubs and marketing initiatives.

• Market for video collaboration is expected to grow, with current meeting room penetration at only 10%.