AVDX AvidXchange Holdings Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 31, 2024

 

 

AvidXchange Holdings, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-40898	86-3391192
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
1210 AvidXchange Lane
Charlotte, North Carolina				28206
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 800 560-9305

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value per share		AVDX		The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On July 31, 2024, AvidXchange Holdings, Inc. issued a press release announcing its financial results for the second quarter ended June 30, 2024. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein in its entirety by reference.

The information in this Item 2.02 (including Exhibit 99.1) is being furnished under Item 2.02 and Item 9.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

Exhibit No.		Description
99.1		Press Release issued by AvidXchange Holdings, Inc. dated July 31, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			AvidXchange Holdings, Inc
Date:	July 31, 2024	By:	/s/ Joel Wilhite
			Joel Wilhite Chief Financial Officer

 

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Exhibit 99.1

 

AvidXchange Announces Second Quarter 2024 Financial Results

Charlotte, N.C. – July 31, 2024 – AvidXchange Holdings, Inc. (Nasdaq: AVDX), a leading provider of accounts payable (AP) automation software and payment solutions for middle market businesses and their suppliers, today announced financial results for the second quarter ended June 30, 2024.

“We are extremely proud of the many milestones we have achieved in short order since our IPO with GAAP net income profitability being the latest. It is because of the transformational value proposition of our AP automation software and payments we deliver to our middle market buyer customers and their suppliers through our proprietary two-sided network that we are in such a strong financial position. As we continue to navigate macro choppiness with the disciplined execution by our team members, we are leveraging our strong balance sheet to advance our innovation by continuing to broaden the application of artificial intelligence (AI) across our customer and internal-facing opportunity sets, which, we believe, will drive increased value for our customers and further enhance our competitive position. I am particularly excited about the future given our recently launched integration partnerships and suite of innovative products that are on the near horizon, from our new Payment 2.0 Platform to Payment Accelerator 2.0, Spend Management, etc. These products, we believe, will not only further embed our capabilities into adjacent non-invoice back-office workflows and deepen our customer relationships, but also strengthen our competitive position, advance our balanced growth and profitability objectives as well as drive value creation for our investors,” said Michael Praeger, Chief Executive Officer & Co-Founder of AvidXchange.

Second Quarter 2024 Financial Highlights:

 

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A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables following the financial statements in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Measures and Other Performance Metrics."

Second Quarter 2024 Key Business Metrics and Highlights:

Full Year 2024 Financial Outlook

As of July 31, 2024, AvidXchange anticipates its Full Year 2024 revenue and adjusted EBITDA to be in the following ranges (in millions):

	Current FY 2024 Guidance		Previous FY 2024 Guidance
Revenue (1)	$436.0 - $439.0		$442.0 - $448.0
Adjusted EBITDA(1&2)	$73.0 - $75.0		$71.0 - $75.0

 

These statements are forward-looking and actual results may differ materially. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

Earnings Teleconference Information

AvidXchange will discuss its second quarter 2024 financial results during a teleconference today, July 31, 2024, at 10:00 AM ET. The call will be broadcast simultaneously via webcast at https://ir.avidxchange.com/. Following the completion of the call, a recorded replay of the webcast will be available on AvidXchange’s website. In addition to the conference call, supplemental information is available on the Investor Relations section of AvidXchange’s website at https://ir.avidxchange.com/.

About AvidXchange™

AvidXchange is a leading provider of accounts payable (“AP”) automation software and payment solutions for middle market businesses and their suppliers. AvidXchange’s software-as-a-service-based, end-to-end software and payment platform digitizes and automates the AP workflows for more than 8,000 businesses and it has made payments to more than 1,200,000 supplier customers of its buyers over the past five years. To learn more about how AvidXchange is transforming the way companies pay their bills, visit www.AvidXchange.com.

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Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements generally relate to future events or our future financial or operating performance and often contain words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “outlook,” “project,” “estimate,” “expect,” “future,” “likely,” “may,” “should,” “continue,” “will” and similar words and phrases indicating future results. The information presented in this press release related to our expectations of future performance, including guidance for our revenue and Adjusted EBITDA for the full year 2024, our ability to counterbalance ongoing and future macroeconomic impacts, our customers’ perceptions of the value proposition of our AP automation software and payments services, the role integration partnerships and product innovation will play in embedding our capabilities into adjacent non-invoice back-office workflows, deepening customer relationships, strengthening our competitive positions, advancing growth and returns, and driving value creation for our investors, and other statements that are not purely statements of historical fact, are forward-looking in nature. These forward-looking statements are made on the basis of management’s current expectations, assumptions, estimates and projections and are subject to significant risks and uncertainties that could cause actual results to differ materially from those anticipated in such forward-looking statements. We therefore cannot guarantee future results, performance or achievements.

Factors which could cause actual results or effects to differ materially from those reflected in forward-looking statements include, but are not limited to, the risk factors and other cautionary statements described, from time to time, in AvidXchange’s filings with the Securities and Exchange Commission (“SEC”), including, without limitation, AvidXchange’s Annual Report on Form 10-K and other documents filed with the SEC, which may be obtained on the investor relations section of our website (https://ir.avidxchange.com/) and on the SEC website at www.sec.gov. Any forward-looking statements made by us in this press release are based only on information currently available to us and speak only as of the date they are made, and we assume no obligation to update any of these statements in light of new information, future events or otherwise unless required under the federal securities laws.

Non-GAAP Measures and Other Performance Metrics

To supplement the financial measures presented in our press release and related conference call in accordance with generally accepted accounting principles in the United States (“GAAP”), we also present the following non-GAAP measures of financial performance: Non-GAAP Gross Profit, Adjusted EBITDA, and Non-GAAP Net Income (Loss).

A “non-GAAP financial measure” refers to a numerical measure of our historical or future financial performance or financial position that is included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in our financial statements. We provide certain non-GAAP measures as additional information relating to our operating results as a complement to results provided in accordance with GAAP. The non-GAAP financial information presented herein should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP and should not be considered a measure of liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies.

We have presented Non-GAAP Gross Profit, Adjusted EBITDA, and Non-GAAP Net Income (Loss) in this press release. We define Non-GAAP Gross Profit as revenue less cost of revenue excluding the portion of depreciation and amortization and stock-based compensation expense allocated to cost of revenues. We define Adjusted EBITDA as our net loss before depreciation and amortization, impairment and write-off of intangible assets, interest income and expense, income tax expense (benefit), stock-based compensation expense, transaction and acquisition-related costs expensed, change in fair value of derivative instrument, non-recurring items not indicative of ongoing operations, and charitable contributions of common stock. We

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define Non-GAAP Net Income (Loss) as net loss before amortization of acquired intangible assets, impairment and write-off of intangible assets, stock-based compensation expense, transaction and acquisition-related costs expensed, change in fair value of derivative instrument, non-recurring items not indicative of ongoing operations, acquisition-related effects on income tax, and charitable contributions of common stock. Non-GAAP income tax expense is calculated using our blended statutory rate except in periods of non-GAAP net loss when it is based on our GAAP income tax expense. In each case, non-GAAP income tax expense excludes the effects of acquisitions in the period on tax expense.

We believe the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are either not part of our core operations or do not require a cash outlay, such as stock-based compensation expense. Management uses these non-GAAP financial measures when evaluating operating performance and for internal planning and forecasting purposes. We believe that these non-GAAP financial measures help indicate underlying trends in the business, are important in comparing current results with prior period results and are useful to investors and financial analysts in assessing operating performance.

Availability of Information on AvidXchange’s Website

Investors and others should note that AvidXchange routinely announces material information to investors and the marketplace using SEC filings, press releases, public conference calls, webcasts, and the Investor Relations section of AvidXchange’s website. While not all information that AvidXchange posts to the Investor Relations website is of a material nature, some information could be deemed to be material. Accordingly, AvidXchange encourages investors, the media and others interested in AvidXchange to review the information that it shares at the Investor Relations link located at https://ir.avidxchange.com. Users may automatically receive email alerts and other information about AvidXchange when enrolling an email address by visiting “Email Alerts” in the “Resources” section of AvidXchange’s Investor Relations website https://ir.avidxchange.com.

 

Investor Contact:

 

Subhaash Kumar

Skumar1@avidxchange.com

813.760.2309

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AvidXchange Holdings, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share data)

		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Revenues		$	105,132			$	91,154			$	210,730			$	177,976
Cost of revenues (exclusive of depreciation and amortization expense)			30,426				30,221				60,759				59,694
Operating expenses
Sales and marketing			19,956				20,076				39,697				40,211
Research and development			25,008				24,740				50,912				47,862
General and administrative			22,635				27,716				46,895				50,343
Impairment and write-off of intangible assets			-				-				162				-
Depreciation and amortization			9,208				8,878				18,515				17,464
Total operating expenses			76,807				81,410				156,181				155,880
Loss from operations			(2,101	)			(20,477	)			(6,210	)			(37,598	)
Other income (expense)
Interest income			5,979				5,204				12,541				9,720
Interest expense			(3,323	)			(3,363	)			(6,660	)			(6,678	)
Other income			2,656				1,841				5,881				3,042
Income (loss) before income taxes			555				(18,636	)			(329	)			(34,556	)
Income tax expense			119				135				244				205
Net income (loss)		$	436			$	(18,771	)		$	(573	)		$	(34,761	)
Net income (loss) per share attributable to common stockholders:
Basic		$	0.00			$	(0.09	)		$	0.00			$	(0.17	)
Diluted		$	0.00			$	(0.09	)		$	0.00			$	(0.17	)
Weighted average number of common shares used to compute net income (loss) per share attributable to common stockholders:
Basic			207,025,967				201,559,007				205,961,720				200,734,555
Diluted			210,370,559				201,559,007				205,961,720				200,734,555

 

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AvidXchange Holdings, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)

		As of June 30,				As of December 31,
		2024				2023
Assets
Current assets
Cash and cash equivalents		$	375,173			$	406,974
Restricted funds held for customers			1,193,455				1,578,656
Marketable securities			89,854				44,645
Accounts receivable, net of allowances of $4,384 and $4,231, respectively			50,086				46,689
Supplier advances receivable, net of allowances of $1,343 and $1,333 respectively			12,610				9,744
Prepaid expenses and other current assets			14,552				12,070
Total current assets			1,735,730				2,098,778
Property and equipment, net			99,282				100,985
Operating lease right-of-use assets			1,299				1,628
Deferred customer origination costs, net			27,805				27,663
Goodwill			165,921				165,921
Intangible assets, net			77,038				84,805
Other noncurrent assets and deposits			4,719				3,957
Total assets		$	2,111,794			$	2,483,737
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable		$	15,419			$	16,777
Accrued expenses			45,702				56,367
Payment service obligations			1,193,455				1,578,656
Deferred revenue			11,821				12,851
Current maturities of lease obligations under finance leases			205				275
Current maturities of lease obligations under operating leases			1,462				1,525
Current maturities of long-term debt			6,425				6,425
Total current liabilities			1,274,489				1,672,876
Long-term liabilities
Deferred revenue, less current portion			13,037				14,742
Obligations under finance leases, less current maturities			62,738				62,464
Obligations under operating leases, less current maturities			2,685				3,275
Long-term debt			69,084				69,760
Other long-term liabilities			3,998				4,175
Total liabilities			1,426,031				1,827,292
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.001 par value; 50,000,000 shares authorized, no shares issued and outstanding as of June 30, 2024 and December 31, 2023			-				-
Common stock, $0.001 par value; 1,600,000,000 shares authorized as of June 30, 2024 and December 31, 2023; 207,819,898 and 204,084,024 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively			207				204
Additional paid-in capital			1,708,289				1,678,401
Accumulated deficit			(1,022,733	)			(1,022,160	)
Total stockholders' equity			685,763				656,445
Total liabilities and stockholders' equity		$	2,111,794			$	2,483,737

 

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AvidXchange Holdings, Inc.

Consolidated Statements of Cash Flows

(in thousands)

		Six Months Ended June 30,
		2024				2023
Cash flows from operating activities
Net loss		$	(573	)		$	(34,761	)
Adjustments to reconcile net loss to net cash used by operating activities
Depreciation and amortization expense			18,515				17,464
Amortization of deferred financing costs			212				220
Provision for credit losses			1,481				2,125
Stock-based compensation			23,278				19,952
Accrued interest			822				1,004
Impairment and write-off on intangible assets			162				-
Accretion of investments held to maturity			(2,209	)			(2,731	)
Deferred income taxes			178				105
Changes in operating assets and liabilities
Accounts receivable			(3,652	)			(4,711	)
Prepaid expenses and other current assets			(2,481	)			631
Other noncurrent assets			(839	)			1,247
Deferred customer origination costs			(142	)			717
Accounts payable			(1,378	)			2,925
Deferred revenue			(2,735	)			45
Accrued expenses and other liabilities			(11,388	)			(20,636	)
Operating lease liabilities			(323	)			(242	)
Total adjustments			19,501				18,115
Net cash provided by (used in) operating activities			18,928				(16,646	)
Cash flows from investing activities
Purchase of marketable securities held to maturity			(98,996	)			(162,996	)
Proceeds from maturity of marketable securities held to maturity			55,996				175,705
Purchases of equipment			(1,100	)			(526	)
Purchases of intangible assets			(8,087	)			(7,733	)
Supplier advances, net			(4,092	)			(946	)
Net cash (used in) provided by investing activities			(56,279	)			3,504
Cash flows from financing activities
Repayments of long-term debt			(813	)			(812	)
Principal payments on finance leases			(150	)			(305	)
Proceeds from issuance of common stock			5,393				703
Proceeds from issuance of common stock under ESPP			1,220				1,178
Payment of debt issuance costs			-				(743	)
Payment of acquisition-related liability			(100	)			(100	)
Payment service obligations			(385,201	)			(94,127	)
Net cash used in financing activities			(379,651	)			(94,206	)
Net decrease in cash, cash equivalents, and restricted funds held for customers			(417,002	)			(107,348	)
Cash, cash equivalents, and restricted funds held for customers
Cash, cash equivalents, and restricted funds held for customers, beginning of year			1,985,630				1,634,387
Cash, cash equivalents, and restricted funds held for customers, end of period		$	1,568,628			$	1,527,039
Supplementary information of noncash investing and financing activities
Property and equipment purchases in accounts payable and accrued expenses		$	19			$	818
Right-of-use assets obtained in exchange for new financing lease obligations			-				81
Right-of-use assets obtained in exchange for new operating lease obligations			-				362
Interest paid on notes payable			2,673				2,541
Interest paid on finance leases			2,954				2,914
Cash paid for income taxes			254				212

 

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AvidXchange Holdings, Inc.

Reconciliation of GAAP to Non-GAAP Measures

 

		Three Months Ended June 30,								Six Months Ended June 30,
Reconciliation from Revenue to Non-GAAP Gross Profit and Non-GAAP Gross Margin		2024				2023				2024				2023
(in thousands)
Total revenues		$	105,132			$	91,154			$	210,730			$	177,976
Expenses:
Cost of revenues (exclusive of depreciation and amortization expense)			(30,426	)			(30,221	)			(60,759	)			(59,694	)
Depreciation and amortization expense			(6,034	)			(5,364	)			(12,098	)			(10,583	)
GAAP Gross profit		$	68,672			$	55,569			$	137,873			$	107,699
Adjustments:
Stock-based compensation expense			1,625				1,344				2,857				2,408
Depreciation and amortization expense			6,034				5,364				12,098				10,583
Non-GAAP gross profit		$	76,331			$	62,277			$	152,828			$	120,690
GAAP Gross margin			65.3	%			61.0	%			65.4	%			60.5	%
Non-GAAP gross margin			72.6	%			68.3	%			72.5	%			67.8	%

 

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AvidXchange Holdings, Inc.

Reconciliation of GAAP to Non-GAAP Measures (Continued)

 

		Three Months Ended June 30,								Six Months Ended June 30,
Reconciliation from Net Loss to Non-GAAP Net Income (Loss), including per share amounts		2024				2023				2024				2023
(in thousands, except share and per share data)
Net loss		$	436			$	(18,771	)		$	(573	)		$	(34,761	)
Exclude: Provision for income taxes			119				135				244				205
Loss before taxes			555				(18,636	)			(329	)			(34,556	)
Amortization of acquired intangible assets			3,414				3,624				6,827				7,247
Impairment and write-off of intangible assets			-				-				162				-
Stock-based compensation expense			12,319				11,021				23,278				19,952
Transaction and acquisition-related costs			-				-				-				(7	)
Non-recurring items not indicative of ongoing operations (1)			(1,976	)			3,626				(630	)			3,635
Total net adjustments			13,757				18,271				29,637				30,827
Non-GAAP income (loss) before taxes			14,312				(365	)			29,308				(3,729	)
Non-GAAP tax expense (2)			3,564				135				7,298				205
Non-GAAP net income (loss)		$	10,748			$	(500	)		$	22,010			$	(3,934	)
Weighted-average shares used to compute Non-GAAP net income (loss) per share attributable to common stockholders, basic			207,025,967				201,559,007				205,961,720				200,734,555
Weighted-average shares used to compute Non-GAAP net income (loss) per share attributable to common stockholders, diluted			210,370,559				201,559,007				210,047,252				200,734,555
GAAP Net income (loss) per share attributable to common stockholders, basic		$	0.00			$	(0.09	)		$	0.00			$	(0.17	)
GAAP Net income (loss) per share attributable to common stockholders, diluted		$	0.00			$	(0.09	)		$	0.00			$	(0.17	)
Non-GAAP basic net income (loss) per share attributable to common stockholders, basic		$	0.05			$	0.00			$	0.11			$	(0.02	)
Non-GAAP basic net income (loss) per share attributable to common stockholders, diluted		$	0.05			$	0.00			$	0.10			$	(0.02	)
GAAP loss per common share, basic and diluted		$	0.00			$	(0.09	)		$	0.00			$	(0.17	)
Amortization of acquired intangible assets			0.02				0.02				0.03				0.04
Impairment and write-off of intangible assets			-				-				-				-
Stock-based compensation expense			0.06				0.05				0.11				0.09
Transaction and acquisition-related costs			-				-				-				-
Non-recurring items not indicative of ongoing operations (1)			(0.01	)			0.02				-				0.02
Provision for income taxes			(0.02	)			-				(0.03	)			-
Adjustment to fully diluted earnings per share			-				-				(0.01	)			-
Non-GAAP diluted income (loss) per common share		$	0.05			$	0.00			$	0.10			$	(0.02	)

 

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AvidXchange Holdings, Inc.

Reconciliation of GAAP to Non-GAAP Measures (Continued)

 

		Three Months Ended June 30,								Six Months Ended June 30,
Reconciliation of Net Loss to Adjusted EBITDA		2024				2023				2024				2023
(in thousands)
Net loss		$	436			$	(18,771	)		$	(573	)		$	(34,761	)
Depreciation and amortization			9,208				8,878				18,515				17,464
Impairment and write-off of intangible assets			-				-				162				-
Interest income			(5,979	)			(5,204	)			(12,541	)			(9,720	)
Interest expense			3,323				3,363				6,660				6,678
Provision for income taxes			119				135				244				205
Stock-based compensation expense			12,319				11,021				23,278				19,952
Transaction and acquisition-related costs			-				-				-				(7	)
Non-recurring items not indicative of ongoing operations (1)			(1,976	)			3,626				(630	)			3,635
Adjusted EBITDA		$	17,450			$	3,048			$	35,115			$	3,446

 

(1) For the three months ended June 30, 2024, this amount was primarily comprised of an insurance recovery of $2,110 costs incurred in response to the cybersecurity incident that was detected in April 2023. For the six months ended June 30, 2024 this amount includes $1,157 of severance costs and a net benefit of $1,808 of response costs incurred in connection with the cybersecurity incident. In the three and six months ended June 30, 2023, this amount was comprised of response costs incurred in connection with the cybersecurity incident. Response costs in each period include professional services and legal fees.
(2) Non-GAAP tax expense is based on the Company's blended tax rate of 24.9% in periods the Company has Non-GAAP income before tax. In periods the Company is in a non-GAAP loss position, tax expense is based on GAAP tax expense.

 

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v3.24.2

Document And Entity Information	Jul. 31, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jul. 31, 2024
Entity Registrant Name	AvidXchange Holdings, Inc.
Entity Central Index Key	0001858257
Entity Emerging Growth Company	false
Entity File Number	001-40898
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	86-3391192
Entity Address, Address Line One	1210 AvidXchange Lane
Entity Address, City or Town	Charlotte
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	28206
City Area Code	800
Local Phone Number	560-9305
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	AVDX
Security Exchange Name	NASDAQ

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