Business
Powerfleet Reports Second Quarter and First Half 2023 Financial Results
Strong Growth in High Margin SaaS Revenues with Company Positioned for Accelerated Growth in Second Half of 2023 Second Quarter 2023 Service Revenue was 66%
About this update from Powerfleet, Inc.
[{"type":"text","content":"Strong Growth in High Margin SaaS Revenues with Company Positioned for Accelerated Growth in Second Half of 2023 Second Quarter 2023 Service Revenue was 66% of Total Revenue, up from 57% in the Prior Period, Driving an Expansion in Total Company Gross Margins to 50% from 47% WOODCLIFF LAKE, N.J., Aug. 08, 2023 (GLOBE NEWSWIRE) -- Powerfleet, Inc. (Nasdaq: PWFL), reported results for the second quarter and six months ended June 30, 2023. SECOND QUARTER 2023 FINANCIAL AND OPERATIONAL HIGHLIGHTS Total service revenue increased by 13% on a constant currency basis, compared to Q2 2022.Total service revenue increased sequentially by 3.3% on a constant currency basis, demonstrating traction in the company’s transformation to a SaaS centric business model.Total service revenue increased to 66% of total revenue, up from 57% in the prior year, driving an expansion in gross margins to 50% from 47%.Services gross margin in the go forward core business (excluding Argentina, Brazil, and South Africa business units) increased to 71% with total gross margin for the core business of 53%.EBITDA increased sequentially by 31% to $1.8 million versus first quarter 2023, pro forma for EBITDA burn from the Movingdots acquisition.Subscriber count totaled 697,177, an increase of 3% from the prior quarter and 9% year- on-year. FIRST HALF 2023 FINANCIAL HIGHLIGHTS (COMPARED TO FIRST HALF 2022) Transformation into a high value sticky SaaS recurring business continues at pace in our core go forward markets with North American service revenue growing 16% annually, complemented by service revenue in Israel growing 10% on a constant currency basis.Growth in services revenue drove expansion in gross margin to 50% from 45% and improved gross profit by $2 million during the controlled product to SaaS sales funnel and revenue mix transition.Improved underlying cash generation with cash from operations increasing by $4 million.With improved cash generation and liquidity, reinitiated paying the dividend on the convertible preferred instrument in cash versus payment in kind (PIK).Taken the necessary steps to reduce annual run rate expense by $4 million per year exiting third quarter. Central to commitment to ensure Movingdots acquisition is adjusted EBITDA neutral.Released a highly advanced, sustainability module on Unity platform, at budget and on time; supports asse...