Banking & Finance

NCino Reports Strong Q2 Revenues, Predicts Continued Growth

By Jenny Callison, posted Sep 2, 2022
Banking software firm nCino debuted on the Nasdaq in July 2020. (File photo)
nCino’s fortunes and future prospects keep rising, as its report for the second quarter of its 2023 fiscal year demonstrates. In most areas, its numbers for Q2 are better than those for both the same period of FY 22 and for Q1 of this fiscal year, which began Feb. 1.
In a news release and subsequent conference call Wednesday afternoon, nCino officials reported total revenues for Q2 of $99.6 million, a 50% increase from $66.5 million in the second quarter of fiscal 2022, and up $5.2 million from total revenues of $94.2 million in the prior quarter.
Second quarter subscription revenues – renewals from existing clients - were $84.4 million, up from $53.9 million one year ago, an increase of 57%. Subscription revenues for Q1 of this fiscal year were $79.2 million. These revenues include the results of SimpleNexus, the provider of homeownership software nCino acquired officially in January of this year. Organic subscription revenues, which exclude the revenues of SimpleNexus, were $69.4 million, a 29% increase from the second quarter of fiscal 2022. Last quarter’s organic subscription revenues, in comparison, were $65.6 million.
“We had a solid second quarter, and I am extremely proud of how well our team executed,” Pierre Naudé, nCino’s chairman and CEO, said in Wednesday’s news release. “Our results this quarter demonstrate the strength of our business model and growing demand for our full suite of product solutions. For example, the number of nCino Bank Operating System customers using our nCino IQ (nIQ) solutions increased 119% year-over-year, and in the mortgage space, SimpleNexus grew subscription revenues 73% year-over-year.
While the company still is not turning a profit, its GAAP loss numbers decreased over those of the previous quarter: a negative $25 million for Q2 of FY 23 as compared with a GAAP loss of negative $27.2 million for Q1. Using non-GAAP measures, the second quarter operating loss was negative $2.8 million, compared with negative $3.7 million for the first quarter of the fiscal year.
nCino’s Remaining Performance Obligation, or the total amount that current clients have committed to spend with the company in the future, also gained ground year-over-year and quarter-over-quarter. The figure reported Wednesday is $907.4 million, an increase of 28% compared with the same period of FY 22. The RPO for the previous quarter was $905.6 million.
The company exceeded its $97 million to $98 million revenue forecast for the second quarter as well as its forecast for subscription revenues of between $81.5 million and $82.5 million. Looking forward to the third quarter of FY 23, officials predict total revenues of between $103 million and $104 million. They forecast a non-GAAP operating loss of between negative $0.75 million and negative $1.75 million.
“With discipline and focus, we are continuing to grow market share across the business and invest responsibly to extend our market leadership, while remaining committed to achieving non-GAAP profitability next year,” Naudé said in the release.
Other highlights of the quarter include customer growth in multiple markets – notably Japan, South Africa and the Netherlands. nCino took its first New Zealand customer live as ASB, one of the country’s leading commercial banks, adopted nCino’s Commercial Banking Solution.
SimpleNexus signed 26 new customers, including community and regional banks, credit unions and independent mortgage banks.
The company also added to its executive team, the news release stated. Matt Hansen was named chief product officer, Jaime Punishill is now chief market officer, Chris Ainsworth is chief people officer and Ben Miller is CEO of SimpleNexus.
As of the second quarter of FY 23, nCino reported more than 1,650 employees and more than 1,750 customers. It maintains its headquarters in Wilmington with offices in Salt Lake City, Toronto, Tokyo, Sydney, Melbourne, London, Paris and Madrid.
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