Procore Technologies, Inc., the leading global provider of construction management software, announced financial results for the third quarter ended September 30, 2023.
“We remain excited about the long-term opportunity ahead of us, as we continue to deliver technology that drives the efficiency and productivity gains that are critical for our customers in today’s uncertain climate. Amidst a more challenging demand environment, we continued to advance our mission of connecting everyone in construction on a global platform, with a number of groundbreaking innovations to the Procore platform,” said Tooey Courtemanche, founder, president and CEO of Procore.
“In Q3, we made significant improvements to our efficiency profile, returning to non-GAAP operating profitability this quarter,” said Howard Fu, CFO of Procore. “In light of the incremental demand headwinds, we remain more focused than ever on maintaining our disciplined operating approach to optimize our efficient growth trajectory in the near and long term.”
Third Quarter 2023 Financial Highlights:
- Revenue was $248 million, an increase of 33% year-over-year.
- GAAP gross margin was 82% and non-GAAP gross margin was 86%.
- GAAP operating margin was (20%) and non-GAAP operating margin was 3%.
- Operating cash inflow for the third quarter was $34 million.
- Free cash inflow for the third quarter was $22 million.
A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”
Recent Business Highlights:
- Added 363 net new organic customers in the third quarter, ending with a total of 16,067 organic customers.
- Achieved a gross revenue retention rate of 95% in the third quarter.
- Announced a number of innovations to the Procore platform related to digital transformation in construction, including the introduction of Procore Copilot, innovations in Procore Connectability, the launch of Procore Pay, and more.
- Published the report “Risk Data Uncovered: How Technology is Transforming Risk Management in Construction,” in partnership with Frost & Sullivan, revealing insights into the transformative potential of technology adoption in construction risk management.
- Partnered with the Associated General Contractors of America to release the report “Top Civil & Infrastructure Trends: Today’s Industry Challenges and Opportunities,” exploring how civil and infrastructure organizations in the U.S. and Canada are building today, the challenges they face, and the opportunities that lie ahead.
Fourth Quarter and Full Year 2023 Outlook:
Procore is providing the following guidance for the fourth quarter and full year 2023:
- Fourth Quarter 2023 Outlook:
- Revenue is expected to be in the range of $247 million to $249 million, representing year-over-year growth of 22% to 23%.
- Non-GAAP operating margin is expected to be in the range of 2% to 3%.
- Full Year 2023 Outlook:
- Revenue is expected to be in the range of $937 million to $939 million, representing year-over-year growth of 30%.
- Non-GAAP operating margin is expected to be in the range of 0.5% to 1%.
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 third quarter results at 2:00 p.m., Pacific Time, on Wednesday, November 1, 2023. A live audio webcast will be accessible on Procore's investor relations website at http://investors.procore.com.
