--Second quarter 2022 revenue growth of 30.3% – or 22.4% organically – driven by continued broad based demand coupled with solid operational execution

--Higher than expected second quarter 2022 revenues, stronger gross margin performance due to on-going payment monetization and cost leverage drive lower-than-expected net loss

--Raising full-year 2022 business outlook for a second consecutive period based on stronger financial results

CHARLOTTE, N.C., Aug. 03, 2022 (GLOBE NEWSWIRE) -- 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, 2022.

“We again delivered solid across-the-board operating and financial results for the second quarter, led by another 20%+ organic revenue growth quarter and lower than expected adjusted EBITDA loss. Our purpose-built value proposition of providing AP and payments automation for middle-market companies has been a boon to our customers during good times and is now proving to be a powerful efficiency lever during uncertain economic times. As companies grow increasingly cautious on adding new headcount or even look to right size their operations, we remain well positioned to advance our buyer customers’ productivity initiatives while helping our supplier customers to optimize their cash flows. We anticipate that this client- and industry-aligned value proposition, with its highly quantifiable benefits, will continue to fuel demand broadly across our large and underpenetrated addressable market. We believe our solid second quarter results and our newly raised guidance for the year further demonstrates the resilience of our value proposition and momentum across our operations,” said Michael Praeger, CEO & Co-Founder of AvidXchange.

Second Quarter 2022 Financial Highlights:

  • Total revenue was $76.6 million, an increase of 30.3% year-over-year, compared with $58.8 million in the second quarter of 2021.
  • GAAP net loss was $(25.7) million, compared with a GAAP net loss of $(22.0) million in the second quarter of 2021.
  • Non-GAAP net loss was $(13.7) million, compared with a Non-GAAP net loss of $(14.9) million in the second quarter of 2021.
  • GAAP gross profit was $42.9 million, or 56.0% of total revenue, compared with $31.2 million, or 53.0% of total revenue, in the second quarter of 2021.
  • Non-GAAP gross profit was $48.7 million, or 63.7% of total revenue, compared with $35.8 million, or 61.0% of total revenue, in the second quarter of 2021.
  • Adjusted EBITDA was $(4.7) million compared with $(5.6) million in the second quarter of 2021.

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 2022 Key Business Metrics and Highlights:

  • Total transactions processed in the second quarter of 2022 was 17.3 million, an increase of 13.2% from 15.3 million in the second quarter of 2021.
  • Total payment volume in the second quarter of 2022 was $16.6 billion, an increase of 36.0% from $12.2 billion in the second quarter of 2021.
  • Transaction yield in the first quarter of 2022 was $4.42, an increase of 15.1% from $3.84 in the second quarter of 2021.

Full Year 2022 Financial Outlook

As of August 3, 2022, AvidXchange anticipates its revised Full Year 2022 revenue and adjusted EBITDA to be in the following ranges (in millions):                                                

  Current
FY 2022 Guidance		Previous
FY 2022 Guidance		 
 Revenue$308.0 - $310.0$303.0 - $307.0 
 Adjusted EBITDA(1)$(27.0) - $(29.0)$(35.0) - $(39.0) 

(1)   A reconciliation of adjusted EBITDA to GAAP net loss on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure.

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 2022 financial results during a teleconference today, August 3, 2022, at 6:00 PM 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 825,000 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.

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,” “project,” “estimate,” “expect,” “future,” “likely,” “may,” “should,” “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 2022, statements related to the significance of our strong performance in the second quarter, the sustainability of our momentum across our operations and trend related to organic revenue growth, statements indicating our belief that our value proposition will continue to fuel demand across our addressable markets, 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 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 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, 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 define Non-GAAP Net 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, provision for income taxes and charitable contributions of common stock.

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.

Investor Contact:

Subhaash Kumar
Skumar1@avidxchange.com 
813.760.2309


AvidXchange Holdings, Inc.
Unaudited Consolidated Statements of Operations
(in thousands, except share and per share data)

  Three Months Ended June 30,  Six Months Ended June 30, 
  2022  2021  2022  2021 
Revenues $76,561  $58,754  $147,764  $113,968 
Cost of revenues (exclusive of depreciation and amortization expense)  28,979   23,011   56,786   45,551 
Operating expenses                
Sales and marketing  20,448   14,547   37,687   28,058 
Research and development  20,107   13,620   40,179   27,553 
General and administrative  19,974   15,770   38,662   29,934 
Impairment and write-off of intangible assets  -   574   -   574 
Depreciation and amortization  8,301   7,093   16,019   14,170 
Total operating expenses  68,830   51,604   132,547   100,289 
Loss from operations  (21,248)  (15,861)  (41,569)  (31,872)
Other income (expense)                
Interest income  655   165   875   297 
Interest expense  (5,075)  (5,086)  (10,052)  (10,111)
Change in fair value of derivative instrument  -   (1,084)  -   (138)
Charge for amending financing advisory engagement letter - related party  -   -   -   (50,000)
Other expenses  (4,420)  (6,005)  (9,177)  (59,952)
Loss before income taxes  (25,668)  (21,866)  (50,746)  (91,824)
Income tax expense  69   133   138   201 
Net loss $(25,737) $(21,999) $(50,884) $(92,025)
Accretion of convertible preferred stock  -   (4,802)  -   (9,404)
Net loss attributable to common stockholders $(25,737) $(26,801) $(50,884) $(101,429)
Net loss per share attributable to common stockholders, basic and diluted $(0.13) $(0.49) $(0.26) $(1.90)
Weighted average number of common shares used to compute net loss per share attributable to common stockholders, basic and diluted  197,864,993   54,562,145   197,443,615   53,317,276 


AvidXchange Holdings, Inc.
Unaudited Consolidated Balance Sheets
(in thousands, except share and per share data)

  As of June 30,  As of December 31, 
  2022  2021 
Assets        
Current assets        
Cash and cash equivalents $363,314  $562,817 
Restricted funds held for customers  1,023,902   1,242,346 
Marketable securities  147,750   - 
Accounts receivable, net of allowances of $2,347 and $2,283, respectively  36,021   30,965 
Supplier advances receivable, net of allowances of $1,357 and $1,105, respectively  14,496   11,520 
Prepaid expenses and other current assets  13,029   10,237 
Total current assets  1,598,512   1,857,885 
Property and equipment, net  105,998   106,227 
Operating lease right-of-use assets  5,564   3,278 
Deferred customer origination costs, net  27,486   28,276 
Goodwill  165,921   165,921 
Intangible assets, net  104,135   100,455 
Other noncurrent assets and deposits  4,667   4,261 
Total assets $2,012,283  $2,266,303 
Liabilities and Stockholders' Equity        
Current liabilities        
Accounts payable $14,361  $17,142 
Accrued expenses  56,569   56,082 
Payment service obligations  1,023,902   1,242,346 
Deferred revenue  10,565   9,530 
Current portion of contingent consideration  -   688 
Current maturities of lease obligations under finance leases  597   670 
Current maturities of lease obligations under operating leases  1,304   1,048 
Current maturities of long-term debt  4,800   4,800 
Total current liabilities  1,112,098   1,332,306 
Long-term liabilities        
Deferred revenue, less current  18,702   20,350 
Contingent consideration, less current portion  70   70 
Obligations under finance leases, less current maturities  61,710   61,172 
Obligations under operating leases, less current maturities  5,370   3,448 
Long-term debt  122,879   119,880 
Other long-term liabilities  2,863   6,022 
Total liabilities  1,323,692   1,543,248 
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, 2022 and December 31, 2021  -   - 
Common stock, $0.001 par value; 1,600,000,000 shares authorized as of June 30, 2022 and December 31, 2021; 198,077,889 and 196,804,844 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively  198   197 
Additional paid-in capital  1,611,828   1,594,780 
Accumulated deficit  (923,435)  (871,922)
Total stockholders' equity  688,591   723,055 
Total liabilities and stockholders' equity $2,012,283  $2,266,303 


AvidXchange Holdings, Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands)

 Six Months Ended June 30, 
 2022  2021 
Cash flows from operating activities       
Net loss$(50,884) $(92,025)
Adjustments to reconcile net loss to net cash used by operating activities       
Depreciation and amortization expense 16,019   14,170 
Amortization of deferred financing costs 679   679 
Provision for doubtful accounts 2,318   251 
Stock-based compensation 15,049   1,952 
Accrued interest 1,184   548 
Loss on fixed asset disposal 26   - 
Noncash expense on contract modification - related party -   50,000 
Impairment and write-off on intangible and right-of-use-assets -   574 
Amortization of investments held to maturity (494)  - 
Fair value adjustment to derivative instrument -   138 
Deferred income taxes 108   108 
Changes in operating assets and liabilities       
Accounts receivable (5,555)  (1,782)
Prepaid expenses and other current assets (2,791)  (1,400)
Other noncurrent assets (453)  (2,489)
Deferred customer origination costs 791   (1,288)
Accounts payable (2,041)  (9,465)
Deferred revenue (613)  664 
Accrued expenses and other liabilities (3,975)  (1,325)
Operating lease liabilities (107)  (403)
Total adjustments 20,145   50,932 
Net cash used in operating activities (30,739)  (41,093)
Cash flows from investing activities       
Purchase of short-term investments held to maturity (254,026)  - 
Proceeds from maturity of short-term investments held to maturity 106,770   - 
Purchases of equipment (2,470)  (344)
Purchases of real estate (767)  - 
Purchases of intangible assets (16,100)  (8,078)
Supplier advances, net (4,796)  (1,710)
Net cash used in investing activities (171,389)  (10,132)
Cash flows from financing activities       
Proceeds from the issuance of long-term debt 2,367   1,131 
Principal payments on finance leases (425)  (589)
Proceeds from issuance of common stock 425   1,163 
Proceeds from issuance of common stock under Employee Stock Purchase Plan 602   - 
Payment of contingent consideration at acquisition date fair value (344)  - 
Payment service obligations (218,444)  543,201 
Net cash (used in) provided by financing activities (215,819)  544,906 
Net (decrease) increase in cash, cash equivalents, and restricted funds held for customers (417,947)  493,681 
Cash, cash equivalents, and restricted funds held for customers       
Cash, cash equivalents, and restricted funds held for customers, beginning of year 1,805,163   390,078 
Cash, cash equivalents, and restricted funds held for customers, end of period$1,387,216  $883,759 
Supplementary information of noncash investing and financing activities       
Right-of-use assets obtained in exchange for new finance lease obligations$499  $174 
Right-of-use assets obtained in exchange for new operating lease obligations 2,831   316 
Common stock issued as contingent consideration 344   - 
Property and equipment purchases in accounts payable and accrued expenses 29   7 
Interest paid on notes payable 5,305   5,199 
Interest paid on finance leases 2,863   3,685 
Options issued in connection with bonus compensation -   48 


AvidXchange Holdings, Inc.
Unaudited Reconciliation of GAAP to Non-GAAP Measures
(in thousands)

 Three Months Ended June 30,  Six Months Ended June 30, 
 2022  2021  2022  2021 
Reconciliation from Revenue to Non-GAAP Gross Profit and Non-GAAP Gross Margin:               
Total revenues$76,561  $58,754  $147,764  $113,968 
Expenses:               
Cost of revenues (exclusive of depreciation and amortization expense) (28,979)  (23,011)  (56,786)  (45,551)
Depreciation and amortization expense (4,700)  (4,579)  (9,006)  (9,103)
GAAP Gross profit$42,882  $31,164  $81,972  $59,314 
Adjustments:               
Stock-based compensation expense 1,161   84   2,120   140 
Depreciation and amortization expense 4,700   4,579   9,006   9,103 
Non-GAAP gross profit$48,743  $35,827  $93,098  $68,557 
GAAP Gross margin 56.0%  53.0%  55.5%  52.0%
Non-GAAP gross margin 63.7%  61.0%  63.0%  60.2%
                
Reconciliation from Net Loss to Non-GAAP Net Loss:               
Net loss$(25,737) $(21,999) $(50,884) $(92,025)
Amortization of acquired intangible assets 3,736   2,752   7,329   5,505 
Impairment and write-off of intangible assets -   574   -   574 
Provision for income taxes 69   133   138   201 
Stock-based compensation expense 8,258   1,105   15,049   1,952 
Transaction and acquisition-related costs 73   1,436   277   3,046 
Change in fair value of derivative instrument -   1,084   -   138 
Non-recurring items not indicative of ongoing operations (65)  25   (57)  50,050 
Total net adjustments 12,071   7,109   22,736   61,466 
Non-GAAP net loss$(13,666) $(14,890) $(28,148) $(30,559)
                
Reconciliation from Net Loss to Adjusted EBITDA:               
Net loss$(25,737) $(21,999) $(50,884) $(92,025)
Depreciation and amortization 8,301   7,093   16,019   14,170 
Impairment and write-off of intangible assets -   574   -   574 
Interest income (655)  (165)  (875)  (297)
Interest expense 5,075   5,086   10,052   10,111 
Provision for income taxes 69   133   138   201 
Stock-based compensation expense 8,258   1,105   15,049   1,952 
Transaction and acquisition-related costs 73   1,436   277   3,046 
Change in fair value of derivative instrument -   1,084   -   138 
Non-recurring items not indicative of ongoing operations (65)  25   (57)  50,050 
Adjusted EBITDA$(4,681) $(5,628) $(10,281) $(12,080)
                
Reconciliation from Revenue Growth to Organic Revenue Growth:               
Revenues$76,561  $58,754  $147,764  $113,968 
Less: Revenues from acquisitions (1) (4,644)  -   (8,148)  - 
Organic revenues$71,917  $58,754  $139,616  $113,968 
Revenue growth 30.3%      29.7%    
Organic revenue growth 22.4%      22.5%    
(1) Acquisitions include FastPay and PayClearly, which were not in the prior year comparable periods.