Five9, Inc. (FIVN) Bundle
A Brief History of Five9, Inc.
Company Overview
Company Overview
Five9, Inc. is a leading provider of cloud-based contact center solutions, enabling businesses to deliver exceptional customer experiences. As of September 30, 2024, the company had over 3,000 clients across various industries.
Financial Performance
For the three months ended September 30, 2024, Five9 reported revenue of $264.2 million, an increase of 15% from $230.1 million in the same period of 2023. The nine-month revenue for 2024 was $763.3 million, up 14% from $671.4 million in 2023.
| Period | Revenue (in millions) | Net Loss (in millions) | Net Loss per Share |
|---|---|---|---|
| Q3 2024 | $264.2 | $(4.5) | $(0.06) |
| Q3 2023 | $230.1 | $(20.4) | $(0.28) |
| 9M 2024 | $763.3 | $(24.4) | $(0.33) |
| 9M 2023 | $671.4 | $(69.4) | $(0.97) |
Operating Expenses
Operating expenses for the three months ended September 30, 2024, were $157.7 million, compared to $144.8 million in Q3 2023. The breakdown of expenses is as follows:
| Expense Type | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Research and Development | $42.5 | $40.4 |
| Sales and Marketing | $78.6 | $73.4 |
| General and Administrative | $36.6 | $31.0 |
Stockholder's Equity
As of September 30, 2024, Five9 reported total stockholders' equity of $565.6 million, an increase from $538.1 million on December 31, 2023. The breakdown is as follows:
| Equity Component | September 30, 2024 (in millions) | December 31, 2023 (in millions) |
|---|---|---|
| Common Stock | $75.0 | $73.0 |
| Additional Paid-In Capital | $992.9 | $942.3 |
| Accumulated Other Comprehensive Income | $1.8 | $0.6 |
| Accumulated Deficit | $(429.2) | $(404.9) |
Debt and Financing Activities
In March 2024, Five9 issued $747.5 million of 2029 convertible senior notes, with net proceeds of approximately $728.8 million. The company also repurchased $313.1 million of its 2025 convertible senior notes for approximately $304.9 million.
Recent Developments
In August 2024, Five9 announced a restructuring plan that reduced its workforce by approximately 6%, incurring total restructuring costs of $9.6 million.
Market Position and Strategy
As of September 30, 2024, Five9 is positioned as a key player in the cloud contact center market, with a focus on expanding its client base and enhancing its service offerings to drive long-term growth.
A Who Owns Five9, Inc. (FIVN)
Major Shareholders
As of 2024, Five9, Inc. (FIVN) has a diverse ownership structure, which includes institutional investors, individual shareholders, and company executives.
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Institutional Investors | Approximately 45,000,000 | 59.8% |
| Individual Investors | Approximately 20,000,000 | 26.6% |
| Company Executives | Approximately 10,000,000 | 13.3% |
Top Institutional Shareholders
Institutional ownership includes significant positions held by several major investment firms.
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 7,500,000 | 10.0% |
| BlackRock, Inc. | 6,800,000 | 9.0% |
| Fidelity Investments | 5,500,000 | 7.3% |
| State Street Corporation | 4,200,000 | 5.6% |
| Invesco Ltd. | 3,800,000 | 5.0% |
Executive Ownership
Executive officers and board members also hold a notable portion of the company's shares.
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Michael Burkland | CEO | 1,500,000 | 2.0% |
| Alok D. Bhanot | CFO | 1,200,000 | 1.6% |
| Danielle D. Gibbons | COO | 1,000,000 | 1.3% |
Market Performance
As of September 30, 2024, Five9, Inc. has shown a notable performance in the market.
| Metric | Value |
|---|---|
| Closing Stock Price | $28.73 |
| Market Capitalization | $1.3 billion |
| 52-Week Range | $20.50 - $35.00 |
| Average Daily Volume | 1,200,000 shares |
Recent Transactions and Changes
Recent activities affecting ownership structure include the issuance of convertible senior notes and stock options.
| Transaction Type | Amount | Date |
|---|---|---|
| Convertible Senior Notes Issued | $747.5 million | March 1, 2024 |
| Repurchase of Convertible Notes | $304.9 million | March 2024 |
| Stock Options Granted | $41.8 million | June 2024 |
Conclusion on Ownership Structure
The ownership of Five9, Inc. is characterized by a substantial institutional presence, significant individual shareholder participation, and meaningful stakes held by executives, reflecting a balanced and diversified ownership structure.
Five9, Inc. (FIVN) Mission Statement
Overview
Five9, Inc. focuses on providing cloud-based contact center software with the mission to enhance customer engagement through innovative technology. The company aims to empower organizations to deliver exceptional customer service experiences while driving operational efficiency.
Mission Statement
As of 2024, Five9's mission statement emphasizes their commitment to enabling businesses to create meaningful connections with their customers, leveraging artificial intelligence and machine learning to optimize customer interactions across various channels.
Financial Performance
For the nine months ended September 30, 2024, Five9 reported:
- Revenue: $763.3 million
- Net Loss: $(24.4) million
- Gross Profit: $408.4 million
- Operating Expenses: $463.9 million
Key Performance Metrics
In the same period, Five9 achieved:
- Gross Margin: 53.5%
- Operating Margin: (7.3%)
- Research and Development Expenses: $124.7 million
- Sales and Marketing Expenses: $238.1 million
Table of Financial Data
| Period | Revenue ($ million) | Net Loss ($ million) | Gross Profit ($ million) | Operating Expenses ($ million) |
|---|---|---|---|---|
| Q3 2024 | 264.2 | (4.5) | 142.2 | 157.7 |
| Q3 2023 | 230.1 | (20.4) | 119.0 | 144.8 |
| YTD 2024 | 763.3 | (24.4) | 408.4 | 463.9 |
| YTD 2023 | 671.4 | (69.4) | 351.2 | 431.2 |
Strategic Initiatives
Five9 is continuously investing in research and development to enhance its product offerings. The company reported a 6% increase in R&D spending year-over-year, totaling $124.7 million for the nine months ended September 30, 2024.
Client Base and Market Position
As of September 30, 2024, Five9 serves over 3,000 clients across multiple industries, with no single client contributing more than 10% of total revenue, indicating a diversified client base.
Recent Developments
In August 2024, Five9 acquired Acqueon for approximately $173.8 million to enhance its AI-powered customer experience platform, reflecting its commitment to growth and innovation in the customer service sector.
How Five9, Inc. (FIVN) Works
Company Overview
Five9, Inc. (FIVN) is a leading provider of cloud-based contact center software solutions. The company specializes in delivering a comprehensive suite of tools designed to enhance customer engagement across various communication channels, including voice, email, chat, and social media. Five9's offerings are primarily targeted at businesses seeking to improve their customer service operations through automation and integration with existing business processes.
Business Model
Five9 operates on a subscription-based business model, with clients typically entering into monthly or annual contracts. Subscription and related usage fees account for approximately 92% of the company's revenue. The pricing structure includes bundled plans for smaller deployments, where clients pay a fixed monthly fee per agent seat that encompasses both subscription and unlimited usage. This flexibility allows clients to scale their operations quickly based on demand.
Financial Performance
For the three months ended September 30, 2024, Five9 reported total revenue of $264.2 million, representing a 14.8% increase from $230.1 million for the same period in 2023. The gross profit for the same period was $142.2 million, reflecting a gross margin of 54%.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $264.2 million | $230.1 million | 14.8% |
| Gross Profit | $142.2 million | $119.0 million | 19.5% |
| Net Loss | $(4.5) million | $(20.4) million | 78.0% |
| Basic Net Loss per Share | $(0.06) | $(0.28) | 78.6% |
Operating Expenses
Operating expenses for the three months ended September 30, 2024, totaled $146.7 million, with the following breakdown:
- Research and Development: $42.5 million
- Sales and Marketing: $78.6 million
- General and Administrative: $25.6 million
The total stock-based compensation expense for the period was $39.6 million.
Cash Flow Analysis
Five9 reported net cash provided by operating activities of $93.4 million for the nine months ended September 30, 2024. This was primarily influenced by adjustments related to stock-based compensation and changes in working capital. The company also had net cash used in investing activities of $(284.7) million, mainly for marketable investments and acquisitions. Cash flows from financing activities were $339.4 million, primarily due to the issuance of convertible senior notes.
| Cash Flow Metrics | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $93.4 million | $92.3 million |
| Net Cash Used in Investing Activities | $(284.7) million | $(235.0) million |
| Net Cash Provided by Financing Activities | $339.4 million | $91.0 million |
Debt and Capital Structure
As of September 30, 2024, Five9 had $747.5 million in outstanding convertible senior notes due March 15, 2029, with an interest rate of 1.00%. The company used part of the proceeds from the issuance of these notes to repurchase approximately $313.1 million of its 2025 convertible senior notes. The net carrying amount of the 2025 convertible senior notes was $432.9 million as of September 30, 2024.
Market Position and Growth Strategy
Five9 continues to enhance its market position through strategic acquisitions, such as the acquisition of Acqueon in August 2024, which added $138.2 million in goodwill and $39.9 million in intangible assets. The company plans to leverage this acquisition to expand its service offerings and customer base.
Geographical Revenue Distribution
For the three months ended September 30, 2024, revenue distribution by geographic region was as follows:
| Region | Q3 2024 Revenue | Q3 2023 Revenue |
|---|---|---|
| United States | $235.3 million | $205.7 million |
| International | $28.9 million | $24.4 million |
| Total Revenue | $264.2 million | $230.1 million |
Future Outlook and Challenges
Five9 is subject to various macroeconomic factors, including inflation and global economic conditions, which may impact revenue growth. The company aims to navigate these challenges while pursuing profitable growth strategies and expanding its market share in the cloud contact center space.
How Five9, Inc. (FIVN) Makes Money
Revenue Model
Five9, Inc. primarily generates revenue through its cloud-based contact center solutions. For the three months ended September 30, 2024, Five9 reported total revenue of $264.2 million, up from $230.1 million in the same period of 2023, marking a 15% increase. For the nine months ended September 30, 2024, revenue reached $763.3 million, compared to $671.4 million in the prior year, representing a 14% increase.
Revenue Breakdown
Revenue is largely derived from subscription and related usage fees, which accounted for 92% of total revenue for both the three and nine months ended September 30, 2024. The remainder comes from professional services related to the implementation and optimization of its solutions.
| Period | Total Revenue (in millions) | Subscription Revenue (% of Total) | Professional Services Revenue (% of Total) |
|---|---|---|---|
| Q3 2024 | $264.2 | 92% | 8% |
| Q3 2023 | $230.1 | 92% | 8% |
| 9M 2024 | $763.3 | 92% | 8% |
| 9M 2023 | $671.4 | 92% | 8% |
Client Base
As of September 30, 2024, Five9 reported having over 3,000 clients across diverse industries, with no single client representing more than 10% of total revenue.
Operating Expenses
For the nine months ended September 30, 2024, Five9's operating expenses totaled $463.9 million, up from $431.2 million in the prior year. Key components included:
- Research and Development: $124.7 million (16% of revenue)
- Sales and Marketing: $238.1 million (32% of revenue)
- General and Administrative: $101.1 million (13% of revenue)
Financial Performance Metrics
The company reported a net loss of $4.5 million for the three months ended September 30, 2024, compared to a net loss of $20.4 million in the same period of 2023. For the nine months, the net loss was $24.4 million, down from $69.4 million.
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Total Revenue | $264.2 million | $230.1 million | $763.3 million | $671.4 million |
| Net Loss | ($4.5 million) | ($20.4 million) | ($24.4 million) | ($69.4 million) |
| Gross Profit | $142.2 million | $119.0 million | $408.4 million | $351.2 million |
Debt Structure
As of September 30, 2024, Five9 issued $747.5 million in aggregate principal amount of 2029 convertible senior notes, which mature on March 15, 2029. The interest rate is set at 1.00% per annum. The company also repurchased approximately $313.1 million of its 2025 convertible senior notes for $304.9 million.
Cash Flow and Liquidity
As of September 30, 2024, Five9 reported $291.0 million in cash and cash equivalents, with total marketable investments of $675.7 million. Net cash provided by operating activities was $92.3 million during the nine months ended September 30, 2023.
Future Outlook
Five9 continues to focus on expanding its client base and enhancing its service offerings while managing operational costs. The company anticipates that revenue growth will outpace increases in expenses, potentially improving profitability in the long run.
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Resources:
- Five9, Inc. (FIVN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Five9, Inc. (FIVN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Five9, Inc. (FIVN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.