EVBG Earnings

Hey everyone,

I know this name has been discussed before but I’ve been digging into it. Here are some takeaways from its latest earnings call.

The numbers:

Revenue growth: 40%
Margin improvement: 5000 bps
Gross margins: 67%
Customer growth: 19%
Average selling price: 20% growth
Free cash flow margins: 9% of sales

Now for some quotes from the earnings call:

Quote #1:
As I stated in previous calls, we are still in the very early stages of our full CEM (critical event management) go-to-market rollout. Today, we sell CEM into the North American geography and only into the corporate and health care verticals, less than 50% of our total markets.

In the first quarter, we released our newest application, Crisis Management. Crisis Management or I may refer to it as CM, brings the number of applications within the CEM Suite to 5. But more importantly, dramatically expands our CEM value proposition for customers, and along with it, our average selling price.

This is a bullish sign that a higher-priced product is just being rolled out and the CEM suite now has a lot of opportunities for upsells.

Quote #2:
Our signing of our largest CEM deal in our history during Q1, a $1.7 million annual recurring contract value for this multi-year deal. This is a monster win for our CEM Suite.

Biggest contract so far. The company is gaining traction with serious enterprises.

Quote #3:
There are a couple of reasons why we’re so excited about our population alerting technology. First, it’s simply the best solution in the planet, with proven scale to manage critical events and communications in the most severe situations across the globe, from cities or states to entire countries.

Population alert, what used to be known as Mass Notifications, is the entry-level product and this will be mandatory internationally by 2022.


Everbridge is one of the only players so I feel that a lot of business will pick up then.

Quote #4:
Just remember, our deals that we’re announcing are typically three year or longer year terms. So you’re talking about a $5 million commitment to Everbridge with these big deals.

The contracts are very sticky. Even longer than ZScaler’s average.

Quote #5:
We continue to be the only player that’s of scale, that’s why we bring up things like The New York Times boasting about saving one million people because at scale, we don’t know of anyone else that does what we do as consistently across multiple geographies across any type of event.

And that - the competition is almost nonexistent there, that’s why we built out the roughly over 100 global patents in place, and it’s why we feel so strongly.

The last time I heard comments like this were on Alteryx’s conference call a year and a half ago. Good signal.

Everbridge looks promising. Wish I had taken it more seriously earlier on. I like that the competition is nowhere to be seen. I’m finding that is one of the most underrated aspects of an investment.

Hope that was helpful.

All the best,


It’s been on a tear since earnings and now I’m worried it’s priced too high to enter?

I love the product. My experience is in crisis management for airports and this product is the only one for large hub airports.

Use of telephone, text message and email all in one message has been a god send.

And yes I’m invested in it.


This reaffirms my belief that it takes much longer for production ready solutions - ones that solve real world problems - to gain traction in the market. I was talking to companies in this space about 10 years ago when briefly working in the US. Not sure if that included Everbridge, or at least some people who would eventually establish the company.

The catalyst was terrorism: how to send out mass alerts to US citizens in the era of Al Qaeda (remember them?). But there was also talk of school shootings.

A couple of questions:

1 - how much of their portfolio is dependent on their local partner ecosystem, e.g. mobile operators, etc. to send out mass alerts, receive replies, etc.? Is this easily replicable outside of the USA, or will it take years to develop out similar partner ecosystems to have a truly comprehensive and robust alerting system?

2 - I wonder how relevant this is for companies outside the USA, where school shootings are rare, and many other similar incidents are seen as outside the control (and responsibility) of commercial enterprises? In the US, if there is a shooting at a company (for example), many people will focus on what the company was doing to protect its employees. Outside of the US, people would typically ask what the government is doing to help protect its citizens, or reduce violence within the culture, etc. Not what Company X should have done per se. Although I suppose large American companies in developing regions (Latin America, Africa) would be interested to show they have controls in place to protect employees when they relocate to those regions.

I will answer #2 first, I don’t have knowledge of outside the USA. Domestically in a matter of 2 seconds I could notify thousands of an active shooter, evacuation, weather alert etc. For a company it’s simply requiring employees to have a smart phone and whether they want to receive it via text, email or phone call.

#1 the system is only as effective and the city, county, state , national has access to smart phone tech. There is little sense in send out messages for active shooters if the delivery is to a computer desktop that the individual isn’t there to open it immediately.


I would add the following comment regarding EU tailwinds, which is a mandatory regulation for population alerting where the only real competitor to Everbridge is home-grown systems Everbridge acquired the UMS leader in population alerting, UMS, last year in anticipation of this opportunity.

How big is this opportunity and when is the revenue expected…?

Large federal TAM in Europe for mass notification expected to land in 18 months (8 figures for large countries and 7 figures for smaller countries…depending on definition this is a $50-$80MM annual revenue adder in my estimate, they will define at analyst day on June 6th)EVGB has withstood this month’s market turbulence. Fundamentally, financially consistent results with increased outlook projections are the norm.

Currently, EVBG is forecasting ~197MM for FY19 revenues… this additional stream would be in the FY20 land timeframe.

I will close with a shoutout to RoyGeeBiv for his posting of the numbers. Much appreciated.

Just a Fool

Current P/S is 16+. Insiders own approx 1.80%.

Here’s a historical snapshot…

Revenue (millions USD)
Q1 Q2 Q3 Q4 Year YOY
2017 22,844 25,021 27,312 29,175 104,352
2018 30,519 35,822 38,925 41,828 147,094 40.96%
2019 42,819

Adj Gross Profit (millions USD)
Q1 Q2 Q3 Q4 Year YOY
2017 15,996 18,133 19,670 21,242 75,041
2018 21,736 25,611 27,330 29,181 103,858 38.40%
2019 29,606

Gross margin percent (Non-GAAP)
Q1 Q2 Q3 Q4 Year
2017 70.02% 72.47% 72.02% 72.81% 71.91%
2018 71.22% 71.50% 70.21% 69.76% 70.61%
2019 69.14%

Adj Operating Profit (millions USD)
Q1 Q2 Q3 Q4 Year
2017 -4,036 -1,573 -735 95 -6,249
2018 -3,415 -3,722 -1,805 -1,389 -10,331
2019 -3,861

Operating Profit % of Revenue (Non-GAAP)
Q1 Q2 Q3 Q4 Year
2017 -17.67% -6.29% -2.69% 0.33% -5.99%
2018 -11.19% -10.39% -4.64% -3.32% -7.02%
2019 -9.02%

Adj Net Profit (millions USD)
Q1 Q2 Q3 Q4 Year
2017 -4,045 -1,491 -575 -487 -6,598
2018 -4,825 -5,089 -3,076 -2,785 -15,775
2019 -4,719

Net Profit % of Revenue (Non-GAAP)
Q1 Q2 Q3 Q4 Year
2017 -17.71% -5.96% -2.11% -1.67% -6.32%
2018 -15.81% -14.21% -7.90% -6.66% -10.72%
2019 -11.02%

Q1 Q2 Q3 Q4 Year
2017 -0.15 -0.05 -0.02 -0.02 -0.24
2018 -0.17 -0.18 -0.10 -0.09 -0.54
2019 -0.15

Opr Cash Flow (millions USD)
Q1 Q2 Q3 Q4 Year
2017 1,459 -3,818 6,738 484 4,863
2018 7,508 -8,960 676 4,071 3,295
2019 8,687

Free Cash Flow (millions USD)
Q1 Q2 Q3 Q4 Year
2017 -251 -5,657 4,364 -1,420 -2,964
2018 5,256 -11,160 -2,449 1,428 -6,925
2019 3,896

Deferred Revenue (millions USD) ASC 606
Q1 Q2 Q3 Q4 Year
2017 70,090 70,090
2018 68,514 79,417 82,263 92,738 92,738
2019 95,325

Total customers
Q1 Q2 Q3 Q4 YOY
2017 3,318 3,201 3,303 3,430
2018 3,811 4,158 4,267 4,422 28.92%
2019 4,532

wordlessly watching, he waits by the window and wonders…