The Whispir Ltd (ASX: WSP) share price is on form on Wednesday morning.
At the time of writing, the cloud communications software company's shares are up 8% to $2.32.
Why is the Whispir share price jumping?
Investors have been bidding the Whispir share price higher following the release of its first quarter update. Here are a few highlights from the quarter:
- Annualised Recurring Revenue (ARR) increased 31.8% year on year to $56.8 million
- 33 net new customers onboarded taking total customers to 834, up 25.4% year on year
- 12-month customer revenue retention of 117.2%
- Quarterly cash receipts up 55.7% year on year to $16.3 million
- Cash and equivalents balance of $43.9 million
What happened during the quarter?
Whispir had a solid quarter and delivered a 31.8% year on year or 6% quarter on quarter increase in its ARR to $56.8 million.
Management advised that this reflects the global megatrends of digitisation and digital transformation which are supporting increasing demand for communications intelligence.
This led to Whispir onboarding 33 net new customers during the quarter. Management notes that these customers were diverse in both regional and industry attributes and took its total customers to 834. This represents 25.4% growth over the prior corresponding period.
Pleasingly, the company also reported that its customers grow stickier over time, as reflected by its 12-month revenue retention of 117.2%. Management feels this highlights strong levels of product satisfaction and expects it to underpin Whispir's future revenue.
Operating cash outflows increased by $2.4 million quarter on quarter to $2.9 million. This was broadly in line with the execution of the company's growth strategy as it scales globally. Despite this increase, Whispir ended the quarter with a strong cash and equivalents balance of $43.9 million.
Whispir's CEO, Jeromy Wells, commented: "Strategic investments across our product roadmap, sales, marketing and customer service continued during the Quarter as we onboard our new customers across ANZ, Asia and North America, while delivering better value for existing customers on the platform."
"This is a strong Quarter of growth for Whispir and we're seeing quality sales momentum across each of our regions. As COVID-related restrictions continue to ease, we're anticipating a return of demand from customers in suppressed industries including transport and aviation. We are ramping up investment in the capability of our global team – which increased by more than 30 people over the quarter – to widen our competitive moat, improve speed to market, and over time, reduce the cost of customer acquisition," he added.
What's next?
Positively, Whispir has reaffirmed its FY 2022 guidance. It continues to expect ARR of $65.4 million to $70 million. This represents year on year growth of 22% to 31%.
Mr Wells concluded: "As our customer growth continues, delivering stronger recurring revenues for Whispir, we're pleased to reaffirm our outlook for FY22. ANZ continues to deliver impressive results and we're building momentum in North America and Asia. We anticipate continued growth in our pipeline across all markets where Whispir is well placed to support businesses with their digitisation and digital transformation agendas."
