'Transformational': Bigtincan (ASX:BTH) share price ignites on 142% revenue jump

What has investors pumped up about Bigtincan on Friday?

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Key points

  • The Bigtincan share price is up 13% following a record result in the first half
  • Brainshark acquisition has helped the company to improve its EBITDA position
  • The company remains on track to exceed $119 million in annual recurring revenue in FY22

The Bigtincan Ltd (ASX: BTH) share price is firing on all cylinders today.

At the time of writing, shares in the sales enablement platform provider are up 13% to 83 cents.

Investors are getting behind Bigtincan after it achieved record results in the first half of FY22. Let's take a closer look at the details.

Bigtincan share price takes flight on outstanding growth

  • Record revenue of $45.9 million, up 142% over the prior corresponding period
  • Annualised recurring revenue (ARR) up 132% to $112 million
  • Adjusted EBITDA reaches $1.2 million from $3.6 million loss in prior period
  • Lifetime value up 98% to $741 million
  • Net retention firms 2% to 107%
  • Brainshark acquisition completed

What else happened during the first half?

The first half was dominated by the company's acquisition of Brainshark — a deal valuing the US-based sales enablement business at A$116 million. Since then, shareholders have been waiting to see whether this acquisition was a great catch, or if Bigtincan bit off more than it could chew.

In a promising sign, the Brainshark acquisition has now been completed and the company is said to be benefitting from it. For example, Bigtincan highlighted synergies as a key driver for the company's improvement in adjusted EBITDA.

In addition, cross-selling of services with Brainshark helped improve its net retention ratio to 107%. Not to mention, the $19.6 million revenue contribution. These positive indicators are being met with a strong Bigtincan share price today.

Notably, the record revenue result has not been detrimental to the composition of subscription-based revenue. Instead, subscription-based made up 98% of Bigtincan's record $45.9 million revenue in the first half.

Regarding customers, it was another big six-month period of locking in new customer wins and expansions. Some of these included deals with Reddit, Clorox, T-Mobile, Delta Airlines, and Guess.

What did management say?

Summarising Bigtincan's performance during the half, CEO David Keane said:

1H FY22 was a transformational period for Bigtincan as we announced, completed and executed on the Brainshark acquisition to further build on our investments in creating a leading platform for sales enablement on a global scale.

Thanks to the ongoing execution of our global team, during the Half Bigtincan was able to demonstrate our ability to improve operating metrics, realise growing efficiency and continue to create the technology that customers love.

What's next?

Offering an optimistic outlook, the company relayed to investors that it is well-positioned to continue its momentum into the second half. This was accompanied by Bigtincan's reassurance that it is on track to surpass $119 million in ARR and $109 million in revenue for FY22.

Heading into the second half, Bigtincan held $49.86 million in cash and cash equivalents. This represents a reduction of ~11%. However, total current assets increased ~22% on the prior half, mainly due to a $17.6 million upwards movement in 'trade and other receivables'.

Bigtincan share price snapshot

Despite the green display today, the Bigtincan share price remains in the negative over the past 12 months. The company's share struggled to find support since announcing the Brainshark acquisition back in August last year.

Shares are down 14.5% compared to the same time a year ago. Underperforming the benchmark index by approximately 17%.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended BIGTINCAN FPO. The Motley Fool Australia has recommended BIGTINCAN FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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