SurveyMonkey, a leader in agile software solutions for customer experience, market research, and survey feedback, today reported third-quarter financial results for the period ended September 30, 2020.
“With 20% year-over-year revenue growth, nearly 450 sequential new enterprise customers, and more than $16 million in free cash flow, SurveyMonkey posted another strong quarter in Q3,” said Zander Lurie, chief executive officer of SurveyMonkey.
“We continued our move up-market as organizations like Calendly, Calm, Gainsight, GAF Materials, McDonald’s Japan, NerdWallet, and Trustmark chose our powerful, agile software to turn feedback into action. Our launch of the GetFeedback platform positions us to be a force in customer experience, a market that is hungry for a cost-efficient solution as organizations increasingly prioritize customer feedback on their digital transformation journey.”
Q3 2020 Key Results
- Total revenue was $95.4 million, an increase of 20% year-over-year.
- Enterprise sales revenue was $27.4 million, an increase of 53% year-over-year. Enterprise sales revenue accounted for approximately 29% of total revenue, up from approximately 23% in Q3 2019. We ended the quarter with approximately 7,700 enterprise sales customers, up 25% from approximately 6,100 in Q3 2019.
- Self-serve revenue was $68.0 million, an increase of 11% year-over-year.
- Deferred revenue was $165.1 million, an increase of 24% year-over-year. Remaining performance obligations (RPO) were $183.3 million, an increase of 20% year-over-year.
- Paying users totaled approximately 803,000, an increase of approximately 90,000, or 13% from more than 713,000 in Q3 2019, and an increase of approximately 22,000 paying users from Q2 2020. Approximately 87% of our paying users were on annual plans, up from 82% a year ago.
- The average revenue per user was $478, up approximately 7% from $448 in Q3 2019.
- GAAP operating margin was negative 23.7% and non-GAAP operating margin was 2.2%.
- GAAP net loss was $26.1 million and GAAP basic and diluted net loss per share was $0.19. Non-GAAP net loss was $1.3 million and non-GAAP basic and diluted net loss per share was approximately $0.01.
- Net cash provided by operating activities was $17.9 million and free cash flow was $16.2 million for 18.7% and 17.0% margin, respectively.
- Cash and cash equivalents totalled $206.3 million and total debt was $214.1 million for net debt of $7.8 million as of September 30, 2020.
Q3 2020 Company Highlights
- Launched the GetFeedback platform, SurveyMonkey’s easy-to-deploy, cost-efficient customer experience (CX) solution that helps organizations set up their CX program within days to quickly understand and act on customer insights. Combining the power of the GetFeedback and Usabilla solutions acquired by SurveyMonkey in 2019, the unified platform offers customers a cohesive user experience to manage programs across any digital channel. The latest features include an AI-powered analytics layer and the ability to unify data and customer attributes, CX program automation, and integration with customers’ existing systems of record like Salesforce, Microsoft, Slack, and Jira.
- Hosted its inaugural CX Impact Summit for organizations and leaders focused on customer experience. The well-attended virtual event featured the launch of the GetFeedback platform, over 25 speakers from Salesforce, Box, PagerDuty, Snap Inc., InVision, CustomerThink, and other CX-minded companies, and 15 virtual sessions across three tracks.
- Announced plans to launch a robust integration between GetFeedback and Salesforce Commerce Cloud to deepen the platform’s connection with Salesforce solutions and strengthen the link between feedback and action for joint customers.
- Formed a launch partnership with Zoom to expand its integration and improve the virtual feedback experience.
- Announced its latest app release for Microsoft Teams to help organizations use in-the-moment feedback to improve the employee experience through new diversity, equity, and inclusion survey templates, shared analytics, private and expanded surveys, and enhanced security.
- Launched Contributor Seats as part of SurveyMonkey Team plans to help distributed workforces collaborate more effectively by providing more flexibility on who can create and own surveys, or leverage survey results to make key decisions.
- Launched the SurveyMonkey Technology Ecosystem Program (STEP), an expanded partner platform that will allow companies to build, launch, and scale their SurveyMonkey integrations with developer resources and go-to-market opportunities.
- Launched it’s Tableau Election Data Hub and Exclusive Polling Partnership with Axios to provide broad access to public opinion data driving one of the most-watched elections of our lifetimes.
- Became a Charter Member of The Board Challenge, a new initiative to help improve the representation of Black directors in corporate U.S. boardrooms.
- Released its latest Mobility Confidence Index Study with J.D. Power, which revealed a slight decrease in attitudes toward autonomous and electric vehicles in late 2020 compared to earlier this year.
- Published research on the current state of customer experience, which indicated that companies with no formal CX program had the lowest rate of financial growth (33%), while organizations with established (50%) and advanced (62%) CX programs were much more likely to experience growth, according to respondents. The company published an additional study, Adapting in Times of Crisis 2020, that highlights curiosity and agility as the top characteristics needed for companies to successfully navigate the pandemic.