Coupa Software Reports Fourth Quarter & Full Year Fiscal 2022 Financial Results

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Coupa Software Reports Fourth Quarter & Full Year Fiscal 2022 Financial Results
  • Record Annual Revenues of $725 Million, 34% Year-Over-Year Growth
  • Record Annual Calculated Billings of $855 Million, 33% Year-Over-Year Growth
  • Record Annual Operating Cash Flows and Adjusted Free Cash Flows of $168 Million and $156 Million, Respectively

SAN MATEO, Calif., March 14, 2022 /PRNewswire/ -- Coupa Software (NASDAQ: COUP) today announced financial results for its fourth quarter and fiscal year ended January 31, 2022.

"We finished the fiscal year strong, delivering record revenue and free cash flow results in the fourth quarter," said Rob Bernshteyn, chairman and chief executive officer at Coupa. "During Fiscal '22, we grew new business in excess of 60%, which we define as new recurring revenue from new customer logos and add-on transactions. That growth was driven by strength in our core business, coupled with momentum in our integration of acquired assets. Our customers continue to realize meaningful value and reach new levels of success with Coupa's all-in-one Business Spend Management platform. As the clear leader in Business Spend Management, we're tightly aligned with our community to bring back-office digital transformation to the forefront, a journey that's only just beginning for many companies."

Fourth Quarter Results:

  • Total revenues were $193.3 million, an increase of 18% compared to the same period last year. Subscription revenues were $173.0 million, an increase of 28% compared to the same period last year.
  • Calculated billings were $318.5 million, an increase of 18% compared to the same period last year. On an organic basis (without giving effect to acquired deferred revenue from LLamasoft of $14.8 million in the fourth quarter of Fiscal 2021), this represents an increase of 25%.
  • GAAP operating loss was $59.8 million, compared to $95.4 million for the same period last year. Non-GAAP operating income was $27.8 million, compared to $11.2 million for the same period last year.
  • GAAP net loss attributable to Coupa Software Incorporated was $96.0 million, compared to $61.4 million for the same period last year. GAAP net loss per basic and diluted share attributable to Coupa Software Incorporated was $1.29, compared to $0.85 for the same period last year. Non-GAAP net income attributable to Coupa Software Incorporated was $14.4 million, compared to $13.0 million for the same period last year. Non-GAAP net income per diluted share attributable to Coupa Software Incorporated was $0.19, compared to $0.17 for the same period last year.
  • Operating cash flows and adjusted free cash flows were positive $64.2 million and $60.6 million, respectively.

Fiscal Year 2022 Results:

  • Total revenues were $725.3 million, an increase of 34% from the previous year. Subscription revenues were $634.0 million, an increase of 35% from the previous year.
  • GAAP operating loss was $244.1 million, compared to $166.6 million for the previous year. Non-GAAP operating income was $89.4 million, compared to $52.7 million for the previous year.
  • GAAP net loss attributable to Coupa Software Incorporated was $379.0 million, compared to $180.1 million for the previous year. GAAP net loss per basic and diluted share attributable to Coupa Software Incorporated was $5.13, compared to $2.63 for the previous year. Non-GAAP net income attributable to Coupa Software Incorporated was $63.2 million, compared to $55.7 million for the previous year. Non-GAAP net income per diluted share attributable to Coupa Software Incorporated was $0.83, compared to $0.77 for the previous year.
  • Operating cash flows and adjusted free cash flows for the year ended January 31, 2022, were positive $168.1 million and $155.6 million, respectively.

See the section titled "Non-GAAP Financial Measures" and the reconciliation tables below for important information regarding the non-GAAP measures used by Coupa.

Business Outlook:

The following forward-looking statements reflect Coupa's expectations as of March 14, 2022.

First quarter of fiscal 2023:

  • Total revenues are expected to be $189.0 to $191.0 million.
  • Subscription revenues are expected to be $171.0 to $173.0 million.
  • Professional services and other revenues are expected to be approximately $18.0 million.
  • Non-GAAP income from operations is expected to be $6.0 to $8.0 million.
  • Non-GAAP net income per diluted share attributable to Coupa Software Incorporated is expected to be $0.03 to $0.06 per share.
  • Diluted weighted average share count is expected to be approximately 86.5 million shares.

Full year fiscal 2023:

  • Total revenues are expected to be $836.0 to $840.0 million.
  • Subscription revenues are expected to be $756.0 to $760.0 million.
  • Professional services and other revenues are expected to be approximately $80.0 million.
  • Non-GAAP income from operations is expected to be $25.0 to $29.0 million.
  • Non-GAAP net income per diluted share attributable to Coupa Software Incorporated is expected to be $0.15 to $0.19 per share.
  • Diluted weighted average share count is expected to be approximately 88.0 million shares.

Coupa has not reconciled its expectations for non-GAAP income from operations to GAAP loss from operations, or non-GAAP net income per diluted share attributable to Coupa Software Incorporated to GAAP net loss per share attributable to Coupa Software Incorporated because certain items excluded from non-GAAP income from operations and non-GAAP net income per diluted share attributable to Coupa Software Incorporated, such as charges related to stock-based compensation expenses, amortization of acquired intangible assets, amortization of debt issuance costs, gain or loss on conversion of convertible senior notes, the adjustment attributable to redeemable non-controlling interests, and related tax effects, including non-recurring income tax adjustments, cannot be reasonably calculated or predicted at this time. In addition, the effect of the anti-dilutive impact of the capped call transactions entered into in connection with the company's offerings of convertible notes in 2018, 2019 and 2020 cannot be reasonably calculated or predicted at this time. The effect of these items may be significant.

Recent Business Highlights:

  • Welcomed many new customers into the Coupa Community in Q4, including Entrata, Formlabs, Fresh Consulting, Grammarly, Happify Inc, Hey Car - Mobility Trader Holding GmbH, Hippo Insurance, Hopper, HotSpot Therapeutics, Index Exchange, IO Bio US, Inc, Libbs Farmacêutica, Luzerner Kantonsspital, Lyten, MasterClass, M-Files, Natural One S/A, NSW Rural Fire Service, Nurix, Ohio Transmission Corporation, Olive, Pernod Ricard Deutschland GmbH, Playstudios, Inc., Remote Technology, Inc., Revel Transit Inc., Rocky Mountaineer, Schrodinger, Science 37, Inc., Senta Partners, Shps Tecnologia E Servicos Ltda, Sloan Valve Co, St. Joseph's University Medical Center, Stahl, Stuart Delivery SL., Sun Auto Tire & Service, Sweetgreen, Tamouh Integrated Business Services LLC, Tenaya Therapeutics, Inc., The Alpha Corporation of Tennessee, The Financial Times Ltd, Traeger Pellet Grills, LLC, Transplace Texas, LP, ÜSTRA Hannoversche Verkehrsbetriebe AG, WealthSimple Inc, WorldStrides LLC, and WSH.
  • Launched Coupa Travel and Expense, a fully unified solution to transform the traveler experience and deliver real-time travel spend optimization.
  • Launched Community.ai, a set of next-gen spend management innovations to transform B2B communities and how buyers and sellers interact.
  • Announced two Coupa Pay partnerships with HSBC and AirPlus to provide European companies with access to a fast, seamless, and secure way to manage payments with virtual cards.
  • Opened submissions for its Spendsetter Awards to recognize leaders revolutionizing business spend management (BSM) at its global community conference Inspire in North America and EMEA.
  • Launched a mentoring program with Black Young Professionals (BYP) and Coupa Empower.
  • Launched its new video series "Trends on Spend" with Coupa Chief Procurement Officer Michael Van Keulen.

President, Finance & Operations – Role Change:

Coupa also announces today that Todd Ford, its President, Finance & Operations, will transition from his current executive position to a newly created advisory role of President & CFO, Emeritus.

"I want to thank Todd for his tremendous contributions at Coupa over the past seven years.  He is an incredible leader at Coupa and partner to me," said Bernshteyn. "We are fortunate that Todd has developed and supported senior leaders in our Finance organization to succeed him, and with Todd continuing his transition as an advisor for an extended period, we expect to have a very smooth transition."

Conference Call Information:

Coupa will host a conference call and live webcast for analysts and investors at 4:30 p.m. Eastern time today.

The live webcast will be accessible on Coupa's investor relations website at http://investors.coupa.com. A replay will be available through the same link.

Non-GAAP Financial Measures:

In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures, including non-GAAP operating (loss) income, non-GAAP net (loss) income attributable to Coupa Software Incorporated, non-GAAP net (loss) income per basic and diluted share attributable to Coupa Software Incorporated, and adjusted free cash flows. Coupa believes these non-GAAP measures are useful in evaluating its operating performance and Coupa's management regularly reviews and uses these measures for business planning and other purposes.

Non-GAAP operating (loss) income and non-GAAP net (loss) income attributable to Coupa Software Incorporated exclude certain items from the corresponding GAAP measures, including: stock-based compensation expenses; amortization of acquired intangible assets; the change in fair value of contingent consideration related to an acquisition; amortization of debt discount and issuance costs; gain or loss on conversion of convertible senior notes; the adjustment attributable to redeemable non-controlling interests; and related tax effects, including non-recurring income tax adjustments. In addition, the weighted average diluted shares figure used to calculate non-GAAP net income per share attributable to Coupa Software Incorporated reflects the anti-dilutive impact of the capped call transactions entered into in connection with the company's offerings of convertible notes.

Adjusted free cash flows is defined as net cash provided by operating activities, less purchases of property and equipment, plus repayments of convertible senior notes attributable to debt discount, plus one-time payout of legacy unvested equity awards accelerated in conjunction with a business combination. Coupa has the ability to settle obligations related to its senior notes through the use of cash, shares of its common stock, or a combination of both, at its election.

Coupa believes these non-GAAP measures are useful to investors and other users of its financial information because they provide a way to measure and evaluate Coupa's underlying operating performance and the strength of its core business consistently across the periods presented. Coupa believes these non-GAAP measures are also useful for comparing its operating performance to that of other companies in its industry, because they eliminate the effects of certain items that may vary between companies for reasons unrelated to their operating performance. Coupa believes that adjusted free cash flows also provides a useful measure of the company's capital strength and liquidity, although it is not intended to represent and should not be viewed as the amount of residual cash flow available for discretionary expenditures.

Coupa uses these non-GAAP measures in conjunction with GAAP measures as part of its overall assessment of its performance and liquidity, including the preparation of its annual operating budget and quarterly forecasts, to evaluate the effectiveness of its business strategies, and to communicate with its board of directors concerning its financial performance and liquidity. Coupa's definitions of its non-GAAP measures may differ from those used by other companies for similarly-titled measures, and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Thus, Coupa's non-GAAP measures should be considered in addition to, not as substitutes for, or in isolation from, the company's GAAP results.

Coupa encourages investors and others to review its financial information in its entirety, not to rely on any single financial measure, and to view its non-GAAP measures in conjunction with GAAP financial measures. In addition, Coupa compensates for the limitations of its non-GAAP financial measures by providing a reconciliation of each non-GAAP measure to the most directly comparable GAAP financial measure. These reconciliations are included in the tables attached to this release.

Forward-Looking Statements:

This release includes forward-looking statements. All statements other than statements of historical facts, including the statements of management and statements in "Business Outlook," are forward-looking statements. These forward-looking statements are based on Coupa's current expectations and projections about future events and trends that Coupa believes may affect its financial condition, results of operations, strategy, short- and long-term business operations and objectives, cash flows, liquidity and financial needs.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, without limitation: Coupa is subject to macroeconomic uncertainties driven by the war in Ukraine, inflation and the COVID-19 pandemic; Coupa has a limited operating history at its current scale, which makes it difficult to predict its future operating results; Coupa may not be able to manage its recent rapid growth effectively; risks related to past and future business acquisitions, including their integration with Coupa's existing business model, operations and culture; if Coupa is unable to attract new customers, the growth of its revenues will be adversely affected; because its platform is sold to large enterprises with complex operating environments, Coupa encounters long and unpredictable sales cycles; the markets in which Coupa participates are intensely competitive; Coupa's business depends in part on its customers renewing their subscriptions and purchasing additional subscriptions; Coupa may not be successful in expanding its sales efforts or developing widespread brand awareness in a cost-effective manner; risks and liabilities related to breach of its security measures or unauthorized access to customer data; and the impact of foreign currency exchange rates and global economic conditions.

These and other risks and uncertainties that could affect Coupa's future results are included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations," in Coupa's quarterly report on Form 10-Q filed with the Securities and Exchange Commission (SEC) on December 7, 2021, which is available at investors.coupa.com and on the SEC's website at www.sec.gov. Further information on potential risks that could affect actual results will be included in other periodic filings Coupa makes with the SEC.

The forward-looking statements in this release reflect Coupa's expectations as of March 14, 2022. Coupa undertakes no obligation to update publicly any forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in its expectations.

The financial results presented in this press release are unaudited and are therefore preliminary. They should not be viewed as a substitute for financial statements prepared in accordance with GAAP. There is a possibility that Coupa's fourth quarter and fiscal 2022 financial results could change prior to the completion of the fiscal 2022 audit.

About Coupa Software

Coupa empowers companies around the world with the visibility and control they need to spend smarter and safer. To learn more about how Coupa can help you spend smarter, visit www.coupa.com. Read more on the Coupa Blog or follow @Coupa on Twitter.

COUPA SOFTWARE INCORPORATED

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)



Three Months Ended

January 31,


Year Ended

January 31,




2022


2021


2022


2021

Revenues:








Subscription

$     172,955


$     134,942


$     634,034


$     470,341

Professional services and other

20,343


28,602


91,255


71,302

Total revenues

193,298


163,544


725,289


541,643

Cost of revenues:








Subscription

55,097


48,039


209,799


147,374

Professional services and other

21,572


31,598


103,437


74,327

Total cost of revenues

76,669


79,637


313,236


221,701

Gross profit

116,629


83,907


412,053


319,942

Operating expenses:








Research and development

40,860


46,383


166,486


133,842

Sales and marketing

89,885


86,481


327,786


236,312

General and administrative

45,727


46,400


161,865


116,341

Total operating expenses

176,472


179,264


656,137


486,495

Loss from operations

(59,843)


(95,357)


(244,084)


(166,553)

Interest expense

(31,887)


(29,451)


(122,741)


(91,271)

Other income (expense), net

(2,137)


4,488


(4,883)


13,321

Loss before provision for (benefit from) income taxes

(93,867)


(120,320)


(371,708)


(244,503)

Provision for (benefit from) income taxes

95


(58,933)


(2,602)


(64,386)

Net loss

(93,962)


(61,387)


(369,106)


(180,117)

Net loss attributable to redeemable non-controlling interests

(273)



(1,063)


Adjustment attributable to redeemable non-controlling interests

2,323



10,996


Net loss attributable to Coupa Software Incorporated

$      (96,012)


$      (61,387)


$    (379,039)


$    (180,117)

Net loss per share, basic and diluted, attributable to Coupa Software Incorporated

$          (1.29)


$          (0.85)


$          (5.13)


$          (2.63)

Weighted-average number of shares used in computing net loss per share, basic and diluted

74,715


72,160


73,816


68,559

 

COUPA SOFTWARE INCORPORATED

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

(unaudited)



January 31, 2022


January 31, 2021

Assets




Current assets:




Cash and cash equivalents

$     506,459


$     323,284

Marketable securities

223,032


283,036

Accounts receivable, net of allowances

226,191


196,009

Prepaid expenses and other current assets

38,270


36,381

Deferred commissions, current portion

21,096


15,541

Total current assets

1,015,048


854,251

Property and equipment, net

30,576


28,266

Deferred commissions, net of current portion

48,562


36,832

Goodwill

1,514,550


1,480,847

Intangible assets, net

510,663


632,173

Operating lease right-of-use assets

42,659


41,305

Other assets

31,121


31,491

Total assets

$  3,193,179


$  3,105,165

Liabilities, Redeemable Non-Controlling Interests, Other Temporary Equity and Stockholders' Equity




Current liabilities:




Accounts payable

$         4,610


$         4,831

Accrued expenses and other current liabilities

79,160


80,271

Deferred revenue, current portion

468,783


356,115

Current portion of convertible senior notes, net

1,639


609,068

Operating lease liabilities, current portion

12,760


11,222

Total current liabilities

566,952


1,061,507

Convertible senior notes, net

1,614,257


897,525

Deferred revenue, net of current portion

22,655


5,773

Operating lease liabilities, net of current portion

31,172


31,845

Other liabilities

52,481


67,915

Total liabilities

2,287,517


2,064,565

Redeemable non-controlling interests

12,084


Other temporary equity


369

Stockholders' equity:




Preferred stock, $0.0001 par value per share


Common stock, $0.0001 par value per share

7


7

Additional paid-in capital

1,778,840


1,556,865

Accumulated other comprehensive income

9,643


9,165

Accumulated deficit

(894,912)


(525,806)

Total stockholders' equity

893,578


1,040,231

Total liabilities, redeemable non-controlling interests, other temporary equity and stockholders' equity

$   3,193,179


$  3,105,165

 

COUPA SOFTWARE INCORPORATED

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)



Year Ended

January 31,



2022


2021

Cash flows from operating activities




Net loss attributable to Coupa Software Incorporated

$     (379,039)


$     (180,117)

Net loss and adjustment attributable to redeemable non-controlling interests

9,933


Net loss

(369,106)


(180,117)

Adjustments to reconcile net loss to net cash provided by operating activities:




Depreciation and amortization

146,392


72,105

Amortization of premium on marketable securities, net

377


1,038

Amortization of deferred commissions

18,600


14,704

Amortization of debt discount and issuance costs

115,688


86,541

Stock-based compensation

199,895


149,423

Loss (gain) on conversion of convertible senior notes

357


(3,154)

Repayments of convertible senior notes attributable to debt discount

(1,338)


(27,409)

Other

(2,876)


3,761

Changes in operating assets and liabilities net of effects from acquisitions:




Accounts receivable

(25,752)


(36,757)

Prepaid expenses and other current assets

(1,447)


2,954

Other assets

23,266


6,786

Deferred commissions

(35,906)


(24,157)

Accounts payable

(326)


(851)

Accrued expenses and other liabilities

(28,569)


(65,995)

Deferred revenue

128,835


79,330

Net cash provided by operating activities

168,090


78,202

Cash flows from investing activities




Purchases of marketable securities

(176,716)


(1,017,751)

Maturities of marketable securities

140,300


396,595

Sale of marketable securities

94,916


835,123

Acquisitions, net of cash acquired

(47,312)


(863,597)

Purchases of other investments

(10,000)


Purchases of property and equipment

(13,853)


(11,492)

Net cash used in investing activities

(12,665)


(661,122)

Cash flows from financing activities




Investment from redeemable non-controlling interests

2,223


Proceeds from issuance of convertible senior notes, net of issuance costs


1,355,066

Purchase of capped calls


(192,786)

Repayments of convertible senior notes

(5,751)


(555,352)

Proceeds from the exercise of common stock options

9,446


19,232

Proceeds from issuance of common stock for employee stock purchase plan

21,626


15,631

Net cash provided by financing activities

27,544


641,791

Effects of foreign currency exchange rates on cash, cash equivalents, and restricted cash

(219)


438

Net increase in cash, cash equivalents, and restricted cash

182,750


59,309

Cash, cash equivalents, and restricted cash at beginning of year

327,589


268,280

Cash, cash equivalents, and restricted cash at end of period

$       510,339


$       327,589

Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets




Cash and cash equivalents

$       506,459


$       323,284

Restricted cash included in other assets

3,880


4,305

Total cash, cash equivalents, and restricted cash

$       510,339


$       327,589

 

COUPA SOFTWARE INCORPORATED

Reconciliation of GAAP to Non-GAAP Financial Measures

Three Months Ended January 31, 2022

(in thousands, except percentages and per share amounts)

(unaudited)



GAAP


Stock-Based

Compensation

Expenses


Amortization of

Acquired

Intangible Assets(2)


Amortization of

Debt Discount 

and

Issuance Costs


Other (3)


Non-GAAP

Costs and expenses:












Costs of subscription

$         55,097


$          (3,857)


$       (18,050)


$                 —


$              —


$         33,190

Costs of professional services and other

21,572


(4,007)


(2,135)




15,430

Gross profit

60.3%


4.1%


10.4%


0.0%


0.0%


74.8%













Research and development

40,860


(11,044)





29,816

Sales and marketing

89,885


(15,441)


(12,781)




61,663

General and administrative

45,727


(20,295)





25,432

Income (loss) from operations

(59,843)


54,644


32,966




27,767

Operating margin

(31.0)%


28.3%


17.1%


0.0%


0.0%


14.4%













Interest expense

(31,887)




29,972



(1,915)

Other income (expense), net

(2,137)






(2,137)

Income (loss) before provision for income taxes

(93,867)


54,644


32,966


29,972



23,715

Provision for income taxes

95


433


8,963



106


9,597

Net income (loss)

(93,962)


54,211


24,003


29,972


(106)


14,118

Net loss attributable to non-controlling interests

(273)






(273)

Adjustment attributable to non-controlling interests

2,323





2,323


Net income (loss) attributable to Coupa Software Incorporated

(96,012)


54,211


24,003


29,972


2,217


14,391













Net income (loss) per share, basic, attributable to Coupa Software Incorporated (1)

$            (1.29)










$              0.19

Net income (loss) per share, diluted, attributable to Coupa Software Incorporated (1)

$            (1.29)










$              0.19



(1)

GAAP net loss per share attributable to Coupa Software Incorporated is calculated based upon 74,715 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share attributable to Coupa Software Incorporated is calculated based upon 74,715 basic and 76,564 diluted weighted-average shares of common stock. The company uses the treasury stock method to calculate the non-GAAP diluted shares related to the convertible notes which reflects any anti-dilutive impact of the capped call transactions entered into in connection with the convertible notes.

(2)

During the fourth quarter of fiscal 2022, the Company identified that it had incorrectly calculated its quarterly non-GAAP income tax adjustment associated with the amortization of acquired intangible assets. The Company corrected the $4.9 million cumulative impact of such errors from prior periods as an out-of-period adjustment in the quarter ended January 31, 2022, of which $2.3 million relates to the previous financial year.

(3)

Other consists of the removal of a one-time income tax benefit associated with the remeasurement of foreign deferred tax assets and an adjustment attributable to non-controlling interests to its redemption amount.

 

COUPA SOFTWARE INCORPORATED

Reconciliation of GAAP to Non-GAAP Financial Measures

Three Months Ended January 31, 2021

(in thousands, except percentages and per share amounts)

(unaudited)



GAAP


Stock-Based

Compensation

Expenses


Amortization of

Acquired

Intangible Assets


Amortization of

Debt Discount and

Issuance Costs


Loss on

Conversion of

Convertible

Senior Notes


Other Expenses (2)


Non-GAAP

Costs and expenses:














Costs of subscription

$          48,039


$           (3,797)


$        (13,191)


$                  —


$                 —


$                  —


$          31,051

Costs of professional services and other

31,598


(7,260)


(6,452)





17,886

Gross profit

51.3%


6.8%


12.0%


0.0%


0.0%


0.0%


70.1%















Research and development

46,383


(16,554)






29,829

Sales and marketing

86,481


(21,856)


(12,916)





51,709

General and administrative

46,400


(24,532)






21,868

Income (loss) from operations

(95,357)


73,999


32,559





11,201

Operating margin

(58.3)%


45.2%


19.9%


0.0%


0.0%


0.0%


6.8%















Interest expense

(29,451)




27,814




(1,637)

Other income (expense)

4,488





12



4,500

Income (loss) before provision for (benefit from) income taxes

(120,320)


73,999


32,559


27,814


12



14,064

Provision for (benefit from) income taxes

(58,933)


1,763


747


7,103



50,378


1,058

Net income (loss)

(61,387)


72,236


31,812


20,711


12


(50,378)


13,006















Net income (loss) per share, basic, attributable to Coupa Software Incorporated (1)

$             (0.85)












$              0.18

Net income (loss) per share, diluted, attributable to Coupa Software Incorporated (1)

$             (0.85)












$              0.17



(1)

GAAP net loss per share attributable to Coupa Software Incorporated is calculated based upon 72,160 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share attributable to Coupa Software Incorporated is calculated based upon 72,160 basic and 77,013 diluted weighted-average shares of common stock. The company uses the treasury stock method to calculate the non-GAAP diluted shares related to the convertible notes which reflects any anti-dilutive impact of the capped call transactions entered into in connection with the convertible notes.

(2)

Other Expenses consists of the release of valuation allowances against deferred tax assets.

 

COUPA SOFTWARE INCORPORATED

Reconciliation of GAAP to Non-GAAP Financial Measures

Year Ended January 31, 2022

(in thousands, except percentages and per share amounts)

(unaudited)



GAAP


Stock-Based

Compensation

Expenses


Amortization of

Acquired

Intangible Assets(2)


Amortization of

Debt Discount 

and

Issuance Costs


Loss on

Conversion of

Convertible

Senior Notes


Other (3)


Non-GAAP

Costs and expenses:














Costs of subscription

$ 209,799


$  (14,920)


$      (63,197)


$                 —


$            —


$           —


$ 131,682

Costs of professional services and other

103,437


(16,991)


(18,151)





68,295

Gross profit

56.8%


4.4%


11.2%


0.0%


0.0%


0.0%


72.4%















Research and development

166,486


(44,119)






122,367

Sales and marketing

327,786


(52,109)


(52,194)





223,483

General and administrative

161,865


(71,756)






90,109

Income (loss) from operations

(244,084)


199,895


133,542





89,353

Operating margin

(33.7)%


27.6%


18.4%


0.0%


0.0%


0.0%


12.3%















Interest expense

(122,741)




115,688




(7,053)

Other income (expense)

(4,883)





357



(4,526)

Income (loss) before provision for (benefit from) income taxes

(371,708)


199,895


133,542


115,688


357



77,774

Provision for (benefit from) income taxes

(2,602)


2,983


14,410




852


15,643

Net income (loss)

(369,106)


196,912


119,132


115,688


357


(852)


62,131

Net loss attributable to non-controlling interests

(1,063)







(1,063)

Adjustment attributable to non-controlling interests

10,996






10,996


Net income (loss) attributable to Coupa Software Incorporated

(379,039)


196,912


119,132


115,688


357


10,144


63,194















Net income (loss) per share, basic, attributable to Coupa Software Incorporated (1)

$      (5.13)












$        0.86

Net income (loss) per share, diluted, attributable to Coupa Software Incorporated (1)

$      (5.13)












$        0.83



(1)

GAAP net loss per share attributable to Coupa Software Incorporated is calculated based upon 73,816 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share attributable to Coupa Software Incorporated is calculated based upon 73,816 basic and 76,297 diluted weighted-average shares of common stock. The company uses the treasury stock method to calculate the non-GAAP diluted shares related to the convertible notes which reflects any anti-dilutive impact of the capped call transactions entered into in connection with the convertible notes.

(2)

During the fourth quarter of fiscal 2022, the Company identified that it had incorrectly calculated its quarterly non-GAAP income tax adjustment associated with the amortization of acquired intangible assets. In the consolidated financial statements ended January 31, 2022, the Company corrected the $2.3 million cumulative impact of such prior-period error as an out-of-period adjustment.

(3)

Other consists of the removal of a one-time income tax benefit associated with the remeasurement of foreign deferred tax assets and an adjustment attributable to non-controlling interests to its redemption amount.

 

COUPA SOFTWARE INCORPORATED

Reconciliation of GAAP to Non-GAAP Financial Measures

Year Ended January 31, 2021

(in thousands, except percentages and per share amounts)

(unaudited)



GAAP


Stock-Based

Compensation

Expenses


Amortization of

Acquired

Intangible Assets


Change in Fair

Value of

Contingent

Consideration

Liability


Amortization of

Debt Discount and

Issuance Costs


Gain on

Conversion of

Convertible

Senior Notes


Other Expenses(2)


Non-GAAP

Costs and expenses:
















Costs of subscription

$ 147,374


$  (11,438)


$      (35,561)


$            —


$           —


$           —


$           —


$ 100,375

Costs of professional services and other

74,327


(15,563)


(7,052)






51,712

Gross profit

59.1%


5.0%


7.9%


0.0%


0.0%


0.0%


0.0%


71.9%

















Research and development

133,842


(37,685)







96,157

Sales and marketing

236,312


(48,414)


(20,284)






167,614

General and administrative

116,341


(55,750)



12,500





73,091

Income (loss) from operations

(166,553)


168,850


62,897


(12,500)





52,694

Operating margin

(30.7)%


31.2%


11.6%


(2.3)%


0.0%


0.0%


0.0%


9.7%

















Interest expense

(91,271)





86,541




(4,730)

Other income (expense)

13,321






(3,154)



10,167

Income (loss) before provision for (benefit from) income taxes

(244,503)


168,850


62,897


(12,500)


86,541


(3,154)



58,131

Provision for (benefit from) income taxes

(64,386)


6,084


432



9,588



50,688


2,406

Net income (loss)

(180,117)


162,766


62,465


(12,500)


76,953


(3,154)


(50,688)


55,725

















Net income (loss) per share, basic, attributable to Coupa Software Incorporated (1)

$      (2.63)














$        0.81

Net income (loss) per share, diluted, attributable to Coupa Software Incorporated (1)

$      (2.63)














$        0.77



(1)

GAAP net loss per share attributable to Coupa Software Incorporated is calculated based upon 68,559 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share attributable to Coupa Software Incorporated is calculated based upon 68,559 basic and 72,692 diluted weighted-average shares of common stock. The company uses the treasury stock method to calculate the non-GAAP diluted shares related to the convertible notes which reflects any anti-dilutive impact of the capped call transactions entered into in connection with the convertible notes.

(2)

Other Expenses consists of the release of valuation allowances against deferred tax assets.

 

COUPA SOFTWARE INCORPORATED

Reconciliation of GAAP Cash Flows from Operations to Adjusted Free Cash Flows and Adjusted Free Cash Flows Margin

(A Non-GAAP Financial Measure)

(in thousands, except percentages)

(unaudited)



Three Months Ended January 31,


Year Ended January 31,


2022


2021


2022


2021

Net cash provided by operating activities

$           64,182


$           20,404


$         168,090


$           78,202

Less: purchases of property and equipment

(3,597)


(1,933)


(13,853)


(11,492)

Add: repayments of convertible senior notes attributable to debt discount


201


1,338


27,409

Add: one-time payout of legacy unvested equity awards accelerated in conjunction with a business combination


19,428



19,428

Adjusted free cash flows

$           60,585


$           38,100


$         155,575


$         113,547




Trailing Twelve
Months Ended January 31,


2022


2021

Net cash provided by operating activities

$      168,090


$        78,202

Less: purchases of property and equipment

(13,853)


(11,492)

Add: repayments of convertible senior notes attributable to debt discount

1,338


27,409

Add: one-time payout of legacy unvested equity awards accelerated in conjunction with a business combination


19,428

Adjusted free cash flows

155,575


113,547

Divided by: total revenues

$      725,289


$      541,643

Adjusted free cash flows margin

21.5 %


21.0 %

 

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SOURCE Coupa Software

Investor Relations: Ravin Bramhe, ir@coupa.com