CEO Seth Ravin says the macroeconomic environment will support Rimini Street in the long term, but for now there are headwinds that will impact second-quarter sales growth.
The company posted quarterly revenue of $101.2 million, up 10.5% year-over-year, and net income of $100,000, down from $6.8 million a year earlier. Lavin says:
Like other companies, we faced headwinds in the global macro environment and exchange rates that impacted our quarterly results. I believe that the macro environment will ultimately benefit our business after the organization completes its re-planning adjustment cycle and I will return to oversee our global earnings operations to re-accelerate growth. Addressing the macro environment and other opportunities, with changes including
Globally, companies will face continued post-pandemic supply chain challenges, profits driven by global macro challenges including war, sanctions, trade disputes, deglobalization, inflation, rising interest rates, and exchange rate volatility. facing the impact of While these macro shocks were initially thought to be short-term effects, they are now likely to be multi-year headwinds that are forcing organizations to re-plan their businesses, including their IT investment plans. considered high.
The replanning phase has frozen many investment decisions. Frozen IT decisions impacted the broader market in the second quarter, as reflected in extended and delayed IT sales cycles for many companies, including Rimini Street. However, as noted above, we believe Rimini Street will ultimately benefit from this macro environment and increase new customer acquisitions as the organization completes the replanning process.
Other notable stats from the post-earnings analyst call:
- Full-year recurring revenues for the second quarter were $396.7 million, up 9.6% from $362.1 million in the year-ago quarter.
- Subscription revenue was $99.2 million, representing 98.0% of total revenue in Q2 2022, compared to $90.5 million during the same period.
- There were 2,905 active clients as of June 30, 2022, a 9.8% increase compared to 2,645 active clients as of June 30, 2021.
- In the second quarter, the company closed more than 9,411 support cases and provided nearly 9,813 tax, legal and regulatory updates to clients in 30 countries.
- The average customer satisfaction score was 4.9 out of 5.0.
New customers in the second quarter include Labeyrie Fine Food, Sajo Systems, SK Networks, Lwart, E-LAND Innople and Australia’s oldest library, the State Library of Victoria. Ravin gave some use cases.
Australia’s oldest library, the State Library of Victoria, trusted Rimini Street to support its Oracle E-business and Oracle database software. Rimini Street also provides libraries with advanced database security and advanced applications with our security solutions. 2 solution and the Rimini Protect suite of security products. These solutions offer an innovative approach to security that can block vulnerabilities before they attack or close attack vectors within hours. This differs from the traditional old vendor software patching model, which can take days, weeks, months, or years to receive a patch and requires significant testing time. and installation costs.
Rimini Street cybersecurity solutions give libraries peace of mind that digital threats are being addressed. Chief Financial Officer Bradley Vice said his finance team was very pleased with the support and security Rimini Street provided. This protects assets and customers and performs financial services. He further said Rimini Street works with his team to identify the risks they face and provide solutions, and enjoys the service the team is receiving.
He also mentioned Labeyrie Fine Food, a French retailer with facilities in 48 countries.
Labeyrie switched support for Oracle JD Edwards and Oracle databases to Rimini Street. With 80 application modules connected to the Oracle ecosystem, Labeyrie processes more than 500,000 batches of orders every night. After the software vendor ended full support for this mission-critical system, it became difficult to maintain. Labeyrie was looking for a solution that would provide the mission-critical support it needed and create more value for the organization while reducing costs.
Labeyrie CIO Louis Goffaux said that in addition to supporting the ERP system, Rimini Street experts are providing guidance on potential changes to how the platform is used. And the monthly and quarterly meetings with Rimini Street have been invaluable and exactly the close all-round support they’ve been looking for. He goes on to say that Rimini Street offers efficient and agile service at half the price he was previously paying software vendors.
You have a pushed deal. Certainly as these companies and government agencies are readjusting their plans to prepare for multiple situations, as seen in so many different company earnings, slow sales cycles and lengthening sales cycles. You can see some of them. Potential recession this year, different types of environments, they’re doing nothing. Because I won’t buy anything until I complete those plans. Based on the engagement we’ve seen, the type of work we’ve done with clients and prospects around the world, we’re feeling pretty positive about the fact that they’ll benefit when they finally complete their plans. We are going to be part of them.
Here, the long game is played out with an underlying message of “keep calm and carry on” in what Ravin calls “this daily global macro-drama.”
It’s a big blow to business. I can’t say anything else. With so many different questions, should I build a factory in China? Will I get into political trouble with that? How to deal with Eastern Europe? How do you think about energy when building a plant within Europe? All these issues are currently wreaking havoc on many companies to the point of paralyzing them and they need to step back and rethink. . This doesn’t mean they don’t want to save money.So I said I hope to win in the end
to the next.