February 4, 2023

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Lower than expected growth Kahoot: – We are not satisfied

Technology company Kahoot presented in the morning hours what at first looks like a good figure for its quarterly report: growth in most segments and items and an increase of 60,000 new subscribers.

However, the company wrote that “a continued slowdown in the overall economy led to lower-than-expected growth in billable income in the fourth quarter.”

Kahoot had billed $43.5 million in revenue in the fourth quarter of 2022 — an increase of 10 percent compared to the fourth quarter of the previous year. Turnover was approximately $39 million (+18%) and adjusted EBITDA was more than $9 million in the first quarter. That gives a margin of 24 percent, compared to 17 percent in the same quarter last year.

But growth is not up to expectations.

The main reason for the decrease in the volume of bills is that customers are more careful about how they spend their money, due to the huge increase in prices that we have seen all over the world.

– We are not satisfied with growth and we will take measures to adapt to the market and ensure further improvement of our business model, says Eilert Hanoa, CEO of Kahoot, in the exchange announcement.

The stock is down 16 percent on the stock exchange.

Some improvements

However, Hanwha also highlights the positives from the quarter.

– We provide cash flow guidance for the full year and set a new record for new subscribers in a single quarter in 2022, says CEO.

Paid sign-ups were over 1.3 million in the fourth quarter after netting 60,000 new paying subscribers, of which 40,000 were in the professional user category.

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Turnover in Kahoot’s core operations rose to more than $75 million, up 20 percent from last year. Cost levels were also kept at the same level as previous quarters, which pushed cash flow to a higher level high at all $42 million, and EBITDA of approximately 30 million for the full year 2022.

Cash flow from operations was about $17 million for the fourth quarter, up 27 percent year-over-year. Cash and cash equivalents increased to $105 million at the end of the fourth quarter, and the company has no interest bearing debt.

More information and guidance for the coming year will be provided when the fourth-quarter quarterly report is presented on February 16.