The Whispir Ltd (ASX: WSP) share price may surprise shareholders today following the release of its first quarter update.
At the time of writing, shares in the software-as-a-service (SaaS) provider are down 9.33% to $3.79. During market open, Whispir shares fell to as low as $3.73.
So how did Whispir perform for the start of FY21?
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Strong Q1 growth
For the period ending September 30, Whispir reported its strongest start to a financial year on record.
Cash receipts totalled $10.5 million for the quarter, an increase of 35% over the prior corresponding period (pcp). This was underpinned by a surge platform usage by existing customers in the Australia, New Zealand and Asia region, up 41.3%.
Annualised recurring revenue (ARR) also grew to $43.7 million, representing a 26.7% lift on Q1 FY20, and 3.6% in the June quarter. Customer revenue retention is tracking to achieve 120% for FY21.
New customer growth saw its biggest performance to date, with the onboarding of 35 net new customers. This brings the total of customer numbers for the company to 665.
Whispir advised it was continuing to provide support to its customers during this uncertain climate. The company noted its ability to integrate with existing IT systems has enabled many customers to use its platform within days.
In addition, Whispir is continuing to invest in development activities to increase and enhance functionality as part of its five-year roadmap. The SaaS provider is well-funded to achieve its strategic objectives.
The company recorded a cash balance of $12 million at the end of the quarter.
Commenting on the result, Whispir CEO Jeromy Wells said:
While Q1 is traditionally the quietest period in our annual sales cycle, September was our strongest ever monthly revenue. Our strong growth in ARR and record net new customers over the past quarter reflects ongoing demand for multi-purpose communications software to improve productivity and stakeholder engagement as our customers navigate 'the new normal'.
Sales and channels
Throughout the quarter, the company increased its market presence in Asia with new customers acquired in Sri Lanka and the Philippines. Established channel partners in the region, such as Deloitte, are helping Whispir achieve new customers and sales.
Most notably, Whispir strengthened its relationship with Amazon Web Services, becoming the first Australian business to do so. In recognition, the company was awarded the newly launched AWS Digital Workplace Competency status.
The award acknowledges Whispir's proficiency in facilitating digital workplaces.
Outlook for the Whispir share price
Whispir performance over the quarter was ahead of expectations, and remains on track to meet its FY21 guidance.
Mr Wells spoke about the company's progress and short-term challenges. He added:
We continue to build momentum within the business, increasing use cases with our existing customers and onboarding new customers. Many of those onboarded in Q3 FY20 are now increasing their platform usage in line with our land and expand strategy and we expect these customers will have a positive impact on revenues later in FY21.
While Whispir has had its strongest Q1 on record, we are still seeing suppressed transaction activity from some customers in some industries, such as aviation, due to COVID-19. As restrictions ease, we anticipate these customers will return to normal volumes.
