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Urgent.ly (ULY) Q2 Earnings call transcript Aug 12, 2024

AInvestTuesday, Aug 13, 2024 5:53 pm ET
2min read

In a recent earnings call, Urgently, a leading provider of roadside assistance services, showcased their financial performance for the second quarter of 2024. The call, led by Jenny Mitchell, Vice President of Finance, Strategy, and Investor Relations, highlighted Urgently's strategic initiatives, financial achievements, and future outlook.

Strategic Initiatives and Financial Performance

Urgently reported a revenue of $34.5 million for the second quarter, which was towards the upper end of their guidance range of $32 million to $35 million. The year-over-year revenue decline of 21% was primarily attributed to the reduction in dispatch volume from a nonrenewed customer partner. However, this was partially offset by volume and rate increases from new and existing partners.

Matt Booth, Urgently's CEO, emphasized the company's focus on executing strategic initiatives to optimize business and financial operations, while reaccelerating sustainable growth. Renewals and expansions of customer contracts, particularly with global OEMs, were highlighted as a significant achievement, underscoring Urgently's commitment to long-term customer relationships.

Operational Efficiency and Cost Reduction

Timothy Huffmyer, Urgently's CFO, discussed operational improvements, including changes in business processes and the reduction of operating expenses. The company has reduced its total employees by 38% and its full-time customer support representatives by 52% since the merger with Otonomo. This has led to a decrease in operational expenses, as well as a reduction in reliance on customer support representatives employed through Business Process Outsourcing (BPO) partners.

Gross Margin and Operating Income

Urgently's gross margin for the second quarter remained at 21%, consistent with the prior year period. However, the company is targeting a long-term gross margin of 25% to 30%. Non-GAAP operating loss for the second quarter was $6.2 million, an improvement from the fourth quarter of 2023. Urgently expects to achieve non-GAAP operating breakeven during the first quarter of 2025.

Future Outlook and Challenges

Matt Booth expressed optimism about Urgently's future, citing the successful execution of strategic initiatives and the company's focus on providing exceptional customer service. However, challenges remain, including the need to capitalize on opportunities around renewals, expansions, and new business while maintaining operational efficiencies. The company also faces the complexities of post-merger integration and the impact of external factors on service mix and job revenue.

Investor Relations and Future Prospects

Looking ahead, Urgently plans to attend the Sidoti Virtual Micro-Cap Investor Conference and host a fireside chat on August 15. The company encourages investors and stakeholders to reach out for one-on-one meetings or follow-up calls. Urgently's focus on strategic initiatives, operational efficiencies, and customer service positions the company for future growth and profitability.

In conclusion, Urgently's second quarter 2024 earnings call provided a comprehensive overview of the company's financial performance and strategic initiatives. The company's focus on operational improvements, customer service, and strategic partnerships positions it for sustainable growth and profitability. Despite challenges, Urgently's leadership remains committed to achieving non-GAAP operating breakeven and capitalizing on market opportunities. As the company navigates post-merger integration and external factors, investors and stakeholders will continue to watch closely for updates on Urgently's progress and future prospects.

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