In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Kaltura Inc (NASDAQ:KLTR) reported record total revenue of $47 million for Q1 2025, marking a 5% year-over-year increase.
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The company achieved record subscription revenue of $44.9 million, up 9% year-over-year.
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Kaltura Inc (NASDAQ:KLTR) posted record ARR for the fourth consecutive quarter, up 7% year-over-year.
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Adjusted EBITA reached a record level of $4.1 million, marking the seventh consecutive quarter of adjusted EBITA profitability.
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The company reported a strong non-GAAP gross margin of 70%, up from 65% in the same quarter last year.
Negative Points
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Cash flow from operations was lower than expected, with $1 million consumed during the quarter.
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New subscription bookings in Q1 were seasonally low, with a typical slower start to the year.
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Professional services revenue declined by 42% year-over-year, consistent with expected trends.
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The company anticipates a lower rate of retention in the first half of the year due to delayed media and telecom insurances.
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Kaltura Inc (NASDAQ:KLTR) maintained its revenue guidance for 2025 despite the uncertain macroeconomic environment.
Q & A Highlights
Q: What are customers telling you about their willingness to spend this year, especially those exposed to consumer or ad spending trends? Are there differences between larger and mid-market customers? A: Ron Ycoil, CEO, stated that there has been no negative impact reported from customers. Kaltura caters to larger organizations that plan for the mid to long term, and there hasn't been any material feedback indicating exposure to current economic situations. While the first quarter is typically slower, there are no alarm bells, and the company remains cautious and thoughtful about the macro environment.
Q: Can you provide more details on the M&T churn and whether customers are downsizing deals or exiting the business? A: Ron Ycoil, CEO, explained that the churn is as expected and primarily involves full exits rather than downsizing. These exits are due to strategic decisions by a few customers, such as bringing services in-house or being acquired by other companies. The churn is temporary, and the company anticipates a rebound in new booking opportunities.
Q: Regarding product development, is Kaltura focusing on building deeper vertical solutions or simplifying products for self-service and down-market expansion? A: Ron Ycoil, CEO, emphasized that Kaltura is not undergoing a revolution in product development. The focus is on enhancing hyper-personalized experiences with AI-infused content management systems. While deeper vertical solutions are prioritized over self-service and down-market expansion, the company is well-positioned to expand into medium-sized enterprises and departmental entries in the future.