Instructure Holdings, Inc. (INST) Bundle
A Brief History of Instructure
Instructure Holdings, Inc., founded in 2008, has evolved significantly, particularly in the education technology sector. As of 2024, the company has established itself as a leader in providing learning management systems (LMS) and has expanded its portfolio to include various educational solutions.
Financial Performance Overview
Instructure's financial performance has shown substantial growth. For the three months ended September 30, 2024, the company's revenue was $173.2 million, up from $134.9 million in the same period of 2023, reflecting a growth rate of 28% year-over-year. For the nine months ended September 30, 2024, revenue reached $499.1 million compared to $394.8 million in 2023, a 26% increase.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Revenue | $173.2M | $134.9M | $499.1M | $394.8M |
| Net Loss | ($24.7M) | ($5.5M) | ($66.8M) | ($28.3M) |
| Adjusted EBITDA | $70.1M | $58.2M | $208.4M | $157.7M |
| Operating Cash Flow | $203.9M | $182.6M | $102.5M | $127.0M |
| Free Cash Flow | $201.5M | $180.8M | $96.3M | $122.4M |
Acquisitions and Growth Strategy
In 2024, Instructure made significant strides in expanding its capabilities through strategic acquisitions. Notably, on February 1, 2024, Instructure acquired Parchment, a leading academic credentialing platform, for $832.2 million. This acquisition aims to enhance Instructure's offerings by providing a comprehensive digital passport for achievement records.
Additionally, Instructure acquired Scribbles on July 1, 2024, further strengthening its position in the education technology space. The total purchase consideration for Scribbles was $81.8 million, financed through cash and debt.
| Acquisition Details | Parchment | Scribbles |
|---|---|---|
| Acquisition Date | February 1, 2024 | July 1, 2024 |
| Total Purchase Price | $834.2M | $81.8M |
| Cash Paid | $832.2M | $80.8M |
| Goodwill Recorded | $593.7M | Provisional Amount |
Market Position and Future Outlook
As of 2024, Instructure continues to adapt to the evolving educational landscape, focusing on digital transformation and integrated solutions. The company is well-positioned for future growth, backed by its robust financial performance and strategic acquisitions.
Instructure's commitment to enhancing its platform and expanding its market reach indicates a proactive approach to meeting the needs of educational institutions and learners alike.
A Who Owns Instructure Holdings, Inc. (INST)
Ownership Structure
As of 2024, Instructure Holdings, Inc. (INST) is undergoing a transition to become a privately held company following a merger agreement with KKR, a global investment firm. The merger agreement was signed on July 25, 2024, and is expected to close in the second half of 2024. Upon completion, Instructure will be a wholly owned subsidiary of KKR, and its common stock will no longer be traded on the NYSE.
Merger Details
Under the terms of the merger agreement, stockholders of Instructure will receive $23.60 per share in cash. The transaction is subject to customary closing conditions, including regulatory approvals.
Current Shareholder Information
Prior to the merger, Instructure's shareholders included institutional investors, mutual funds, and individual investors. The company's common stock was publicly traded, which made it accessible to a wide range of investors. As of September 30, 2024, the total number of shares issued and outstanding was 147,089,318.
Major Shareholders
The major shareholders of Instructure Holdings, Inc. include:
- KKR (as the acquiring entity post-merger)
- Institutional investors and mutual funds
- Individual shareholders
Financial Overview Prior to Merger
For the third quarter of 2024, Instructure reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Revenue | $173.2 million | $134.9 million |
| Net Loss | ($24.7 million) | ($5.5 million) |
| Adjusted EBITDA | $70.1 million | $58.2 million |
| Operating Cash Flow | $203.9 million | $182.6 million |
| Free Cash Flow | $201.5 million | $180.8 million |
Shareholder Impact of the Merger
The merger with KKR signifies a significant change in ownership structure, transitioning from a public company to a private entity. This shift will likely impact existing shareholders, as their shares will be converted to cash at the agreed merger price.
Conclusion of Ownership Transition
Upon the successful completion of the merger, KKR will become the sole owner of Instructure Holdings, Inc., marking a notable transition in its corporate structure and ownership model. The financial implications of this merger are substantial, as it alters the liquidity and investment landscape for former shareholders.
Instructure Holdings, Inc. (INST) Mission Statement
Overview of the Mission Statement
Instructure Holdings, Inc. focuses on providing innovative educational technology solutions that enhance teaching and learning experiences across various educational institutions. The mission emphasizes the commitment to improving educational outcomes through user-friendly platforms.
Financial Performance
As of September 30, 2024, Instructure reported significant financial metrics that highlight its performance:
| Metric | Q3 2024 | Q3 2023 | Nine Months 2024 | Nine Months 2023 |
|---|---|---|---|---|
| Total Revenue | $173.2 million | $134.9 million | $499.1 million | $394.8 million |
| Net Loss | $(24.7) million | $(5.5) million | $(66.8) million | $(28.3) million |
| Adjusted EBITDA | $70.1 million | $58.2 million | $208.4 million | $157.7 million |
| Operating Cash Flow | $203.9 million | $182.6 million | $102.5 million | $127.0 million |
| Free Cash Flow | $201.5 million | $180.8 million | $96.3 million | $122.4 million |
Strategic Acquisitions
Instructure's growth strategy includes strategic acquisitions to enhance its product offerings:
- On February 1, 2024, Instructure acquired Parchment, the largest academic credentialing platform, for approximately $834.2 million.
- On July 1, 2024, the company acquired Scribbles for around $81.8 million.
Market Position and Customer Base
Instructure primarily serves K-12 and higher education institutions, with a notable international presence:
- As of September 30, 2024, 18% of total revenue was generated from international markets, amounting to $31.4 million.
- The company's subscription and support revenue grew by 30% year-over-year.
Deferred Revenue
Deferred revenue is a critical metric indicating future revenue recognition:
As of September 30, 2024, Instructure reported deferred revenue of $384.0 million, with $374.4 million expected to be recognized within the next 12 months.
Stock Performance and Shareholder Information
As of September 30, 2024, Instructure had:
- 147,089,318 shares of common stock issued and outstanding.
- A net loss per common share of $(0.17) for Q3 2024.
Conclusion of Financial Highlights
Instructure Holdings, Inc. continues to focus on enhancing its mission to improve educational outcomes through strategic growth, financial performance, and customer engagement.
How Instructure Holdings, Inc. (INST) Works
Company Overview
Instructure Holdings, Inc. (INST) is a leading provider of software solutions for the education sector, specializing in learning management systems (LMS) and credentialing platforms. As of September 30, 2024, Instructure has expanded its offerings significantly through strategic acquisitions and product developments.
Recent Financial Performance
For the three months ended September 30, 2024, Instructure reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Revenue | $173.2 million | $134.9 million |
| Net Loss | $(24.7) million | $(5.5) million |
| Adjusted EBITDA | $70.1 million | $58.2 million |
| Operating Cash Flow | $203.9 million | $182.6 million |
| Free Cash Flow | $201.5 million | $180.8 million |
For the nine months ended September 30, 2024, the financial performance was as follows:
| Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Revenue | $499.1 million | $394.8 million |
| Net Loss | $(66.8) million | $(28.3) million |
| Adjusted EBITDA | $208.4 million | $157.7 million |
| Operating Cash Flow | $102.5 million | $127.0 million |
| Free Cash Flow | $96.3 million | $122.4 million |
Acquisitions
Instructure has made significant acquisitions to enhance its market position:
- Parchment Acquisition: Acquired for $834.2 million on February 1, 2024.
- Scribbles Acquisition: Acquired for $81.8 million, completed on July 1, 2024.
Deferred Revenue
As of September 30, 2024, Instructure had a deferred revenue balance of:
| Deferred Revenue (as of Sep 30, 2024) | Amount |
|---|---|
| Total Deferred Revenue | $384.0 million |
| Current Liability Portion | $374.4 million |
Liquidity and Capital Resources
As of September 30, 2024, Instructure's liquidity profile consisted of:
| Liquidity Metrics | Amount |
|---|---|
| Cash and Cash Equivalents | $203.2 million |
| Funds Held on Behalf of Customers | $6.1 million |
Stockholder Equity
As of September 30, 2024, Instructure's stockholder equity was:
| Equity Metrics | Amount |
|---|---|
| Total Stockholder Equity | $1,263.3 million |
| Shares Outstanding | 147.1 million |
Operating Expenses
For Q3 2024, Instructure's operating expenses included:
| Expense Category | Amount |
|---|---|
| Sales and Marketing | $67.7 million |
| Research and Development | $31.9 million |
| General and Administrative | $26.7 million |
The total operating expenses for Q3 2024 were $126.3 million, compared to $82.9 million in Q3 2023.
Debt Structure
Instructure's debt structure as of September 30, 2024, includes:
| Debt Metrics | Amount |
|---|---|
| Senior Secured Term Loan | $500.0 million |
| Senior Secured Revolving Credit Facility | $125.0 million |
As of September 30, 2024, there were no outstanding borrowings under the Senior Revolver.
How Instructure Holdings, Inc. (INST) Makes Money
Revenue Streams
Instructure Holdings, Inc. primarily generates revenue from two key sources:
- Subscription and Support Revenue: This includes fees from customers accessing the learning platform and additional support services.
- Professional Services Revenue: Revenue derived from training, implementation, and consulting services.
Financial Performance
For the three months ended September 30, 2024, Instructure reported the following:
| Revenue Category | Q3 2024 ($ millions) | Q3 2023 ($ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| Subscription and Support | 160.2 | 123.1 | 37.1 | 30% |
| Professional Services and Other | 13.0 | 11.8 | 1.2 | 10% |
| Total Revenue | 173.2 | 134.9 | 38.3 | 28% |
For the nine months ended September 30, 2024, the financials were as follows:
| Revenue Category | 9M 2024 ($ millions) | 9M 2023 ($ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| Subscription and Support | 462.4 | 360.2 | 102.3 | 28% |
| Professional Services and Other | 36.6 | 34.7 | 1.9 | 6% |
| Total Revenue | 499.1 | 394.8 | 104.2 | 26% |
Cost of Revenue and Gross Margin
The costs associated with revenue generation for Q3 2024 were:
| Cost Category | Q3 2024 ($ millions) | Q3 2023 ($ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| Subscription and Support | 49.8 | 40.3 | 9.5 | 24% |
| Professional Services and Other | 9.0 | 7.1 | 1.9 | 26% |
| Total Cost of Revenue | 58.8 | 47.4 | 11.4 | 24% |
The gross margin percentages for the same period were:
| Revenue Type | Gross Margin (%) |
|---|---|
| Subscription and Support | 69% |
| Professional Services and Other | 31% |
| Total Gross Margin | 66% |
Operating Expenses
Operating expenses for Q3 2024 included:
| Expense Category | Q3 2024 ($ millions) | Q3 2023 ($ millions) | Change ($ millions) |
|---|---|---|---|
| Sales and Marketing | 67.7 | 46.7 | 21.0 |
| Research and Development | 31.9 | 20.7 | 11.2 |
| General and Administrative | 26.7 | 15.5 | 11.2 |
| Total Operating Expenses | 126.3 | 82.9 | 43.4 |
Net Loss and Cash Flow
For the three months ended September 30, 2024, Instructure recorded a net loss of:
| Period | Net Loss ($ millions) |
|---|---|
| Q3 2024 | 24.7 |
| Q3 2023 | 5.5 |
Operating cash flow for the nine months ended September 30, 2024 was:
| Cash Flow Type | 9M 2024 ($ millions) | 9M 2023 ($ millions) |
|---|---|---|
| Operating Cash Flow | 102.5 | 127.0 |
| Free Cash Flow | 96.3 | 122.4 |
Acquisition Impact
Instructure's acquisition of Parchment in February 2024 significantly boosted its revenue streams. The financial contributions from Parchment for the nine months ended September 30, 2024 were:
| Period | Parchment Revenue ($ millions) | Parchment Net Income ($ millions) |
|---|---|---|
| 9M 2024 | 83.4 | 7.0 |
Instructure's strategic focus on expanding its customer base in the higher education and K-12 sectors is expected to drive further revenue growth as it continues to enhance its offerings and integrate services through acquisitions.
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Resources:
- Instructure Holdings, Inc. (INST) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Instructure Holdings, Inc. (INST)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Instructure Holdings, Inc. (INST)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.