Brightcove Inc. reports 8.0 pp EBITDA Margin growth from -2.6% to 5.5% in 2020 in 2020 and 7.0% Revenue growth
02/17/2021 • About Brightcove Inc. (
$BCOV) • By InTwits
Brightcove Inc. reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- EBITDA Margin is expanding: 5.5% in 2020 vs. -2.6% in 2019 vs. -0.8% in 2016
- Brightcove Inc. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2016-2020 was 0.0% while average EBITDA Margin was -1.6% for the sames years
- Brightcove Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.9%.
- The company has unprofitable business model: ROIC is -5.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Brightcove Inc.'s Revenue increased on 7.0%. Revenue growth showed acceleration in 20Q4 - it increased 12.8% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 6.9 pp from 12.1% to 5.2% in 2020. During 2016-2020 EBITDA Margin bottomed in 2017 at -8.0% and was growing since that time.
Gross Margin increased on 2.4 pp from 59.1% to 61.4% in 2020. SG&A as a % of Revenue decreased on 2.7 pp from 46.7% to 44.0% in 2020. During the last 5 years SG&A as a % of Revenue topped in 2017 at 50.8% and was declining since that time.
Net Income margin increased on 8.9 pp from -11.9% to -2.9% in 2020.
Investments (CAPEX, working capital and M&A)
In 2020 the company had CAPEX/Revenue of 1.2%. The company showed almost no change in CAPEX/Revenue from 2017 to 2020. It's average CAPEX/Revenue for the last three years was 0.90%.
Return on investment
The company operates at negative ROIC (-5.2%) and ROE (-7.6%). ROIC surged on 19.6 pp from -24.8% to -5.2% in 2020. ROE jumped on 22.7 pp from -30.3% to -7.6% in 2020.
Leverage (Debt)
Debt level is -2.6x Net Debt / EBITDA and 0.9x Debt / EBITDA. Debt dropped on 44.9% while cash jumped on 64.6%.
Brightcove Inc. has no short term refinancing risk: cash is higher than short term debt (862.2%).
Management team
The company's CEO Jeff Ray has spent 2 years with the company. Brightcove Inc.'s CFO Robert Noreck has spent 2 years with the company.
Financial and operational results
FY ended 12/31/2020
Brightcove Inc. ($BCOV) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 150.3 | 155.9 | 164.8 | 184.5 | 197.4 | 7.0% |
| Gross Profit | 94.4 | 91.3 | 98.2 | 109.0 | 121.3 | 11.3% |
| SG&A | 73.2 | 79.1 | 78.9 | 86.1 | 86.8 | 0.9% |
| EBITDA | -1.2 | -12.4 | -6.3 | -4.7 | 10.8 | |
| Net Income | -10.0 | -19.5 | -14.0 | -21.9 | -5.8 | |
Balance Sheet
|
|---|
| Cash | 36.8 | 26.1 | 29.3 | 22.8 | 37.5 | 64.6% |
| Short Term Debt | 0.8 | 0.3 | 0.2 | 6.2 | 4.3 | -29.6% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 11.7 | 5.5 | -53.0% |
Cash flow
|
|---|
| Capex | 1.3 | 1.1 | 1.5 | 1.0 | 2.4 | 125.6% |
Ratios
|
|---|
| Revenue growth | 11.6% | 3.8% | 5.7% | 11.9% | 7.0% | |
| EBITDA growth | -167.3% | 952.4% | -49.3% | -24.8% | -327.2% | |
|
|---|
| Gross Margin | 62.8% | 58.6% | 59.6% | 59.1% | 61.4% | 2.4% |
| EBITDA Margin | -0.8% | -8.0% | -3.8% | -2.6% | 5.5% | 8.0% |
| SG&A, % of revenue | 48.7% | 50.8% | 47.9% | 46.7% | 44.0% | -2.7% |
| Net Income Margin | -6.6% | -12.5% | -8.5% | -11.9% | -2.9% | 8.9% |
| CAPEX, % of revenue | 0.9% | 0.7% | 0.9% | 0.6% | 1.2% | 0.6% |
|
|---|
| ROIC | -11.3% | -26.9% | -19.0% | -24.8% | -5.2% | 19.6% |
| ROE | -12.8% | -26.9% | -20.4% | -30.3% | -7.6% | 22.7% |
| Net Debt/EBITDA | | | | | -2.6x |
Brightcove Inc. ($BCOV) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 47 | 48 | 49 | 54 | | 11.5% | 0.7% | 3.5% | 12.8% |
| EBITDA | -5 | 1 | 3 | 11 | | - | - | 83.2% | - |
| Net Income | -8 | -1 | 1 | 2 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 32 | 28 | 30 | 37 | | 10.9% | 30.9% | 33.9% | 64.6% |
| Short Term Debt | 6 | 6 | 6 | 4 | | -6.5% | -10.8% | -6.1% | -29.6% |
| Long Term Debt | 20 | 14 | 12 | 5 | | 53.7% | 14.4% | 16.3% | -53.0% |
Ratios
|
|---|
| Gross Margin | 60.0% | 58.5% | 63.1% | 63.8% | | 0.1% | 3.9% | 1.7% | 3.3% |
| EBITDA Margin | -10.0% | 1.7% | 6.9% | 20.2% | | -7.3% | 7.9% | 3.0% | 25.4% |
| Net Income Margin | -16.8% | -2.7% | 2.7% | 3.8% | | -4.9% | 12.5% | 8.9% | 17.9% |
Peers in Internet Services & Infrastructure
Below we provide Brightcove Inc. benchmarking against other companies in Internet Services & Infrastructure industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| MongoDB, Inc. ($MDB) | - | 55.3% | 63.8% | 60.8% | 57.9% |
| Twilio Inc. ($TWLO) | - | 43.9% | 62.9% | 74.5% | 55.3% |
| Okta, Inc. ($OKTA) | - | 86.6% | 60.0% | 55.6% | 46.8% |
| Wix.com Ltd. ($WIX) | - | 46.7% | 41.8% | 26.1% | 29.9% |
| Limelight Networks, Inc. ($LLNW) | - | 9.6% | 6.1% | 2.5% | 14.7% |
| |
|---|
| Median (9 companies) | 20.7% | 13.7% | 19.2% | 21.2% | 14.7% |
|---|
| Brightcove Inc. ($BCOV) | - | 3.8% | 5.7% | 11.9% | 7.0% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VeriSign, Inc. ($VRSN) | 82.6% | 83.4% | 84.2% | 85.3% | 85.8% |
| Okta, Inc. ($OKTA) | 58.1% | 65.1% | 68.5% | 71.6% | 72.8% |
| MongoDB, Inc. ($MDB) | 68.0% | 70.5% | 74.2% | 72.4% | 70.3% |
| Crexendo Inc ($CXDO) | 60.2% | 67.9% | 67.9% | 69.9% | 69.8% |
| Wix.com Ltd. ($WIX) | 84.4% | 83.7% | 79.0% | 74.1% | 68.1% |
| |
|---|
| Median (9 companies) | 59.2% | 65.0% | 66.4% | 69.9% | 68.1% |
|---|
| Brightcove Inc. ($BCOV) | 62.8% | 58.6% | 59.6% | 59.1% | 61.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VeriSign, Inc. ($VRSN) | 65.2% | 65.0% | 67.1% | 69.2% | 68.8% |
| Akamai Technologies, Inc. ($AKAM) | 33.9% | 27.6% | 29.4% | 39.5% | 41.0% |
| GoDaddy Inc. ($GDDY) | 11.4% | 12.2% | 14.4% | 15.6% | 15.8% |
| Crexendo Inc ($CXDO) | -28.7% | -6.2% | -1.0% | 10.6% | 7.8% |
| Limelight Networks, Inc. ($LLNW) | -30.9% | 6.7% | 7.0% | 3.8% | 5.2% |
| |
|---|
| Median (9 companies) | -5.1% | -1.1% | 16.8% | 3.8% | 5.2% |
|---|
| Brightcove Inc. ($BCOV) | -0.8% | -8.0% | -3.8% | -2.6% | 5.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Akamai Technologies, Inc. ($AKAM) | 13.5% | 16.7% | 14.9% | 19.4% | 22.9% |
| Limelight Networks, Inc. ($LLNW) | 5.7% | 11.2% | 8.2% | 17.3% | 10.9% |
| Crexendo Inc ($CXDO) | 0.0% | 0.0% | 0.1% | 0.5% | 4.5% |
| VeriSign, Inc. ($VRSN) | 2.3% | 4.2% | 3.0% | 3.3% | 3.4% |
| Okta, Inc. ($OKTA) | 4.8% | 3.9% | 2.6% | 5.0% | 2.6% |
| |
|---|
| Median (9 companies) | 4.0% | 4.1% | 3.3% | 3.3% | 2.6% |
|---|
| Brightcove Inc. ($BCOV) | 0.9% | 0.7% | 0.9% | 0.6% | 1.2% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VeriSign, Inc. ($VRSN) | 65.2% | 54.3% | 81.9% | 228.3% | 221.3% |
| Akamai Technologies, Inc. ($AKAM) | 11.9% | 7.9% | 8.2% | 10.8% | 10.9% |
| GoDaddy Inc. ($GDDY) | 2.9% | 2.7% | 4.6% | 6.0% | 8.1% |
| Crexendo Inc ($CXDO) | -114.0% | -44.3% | -10.5% | 35.4% | 7.3% |
| Limelight Networks, Inc. ($LLNW) | -42.9% | -5.7% | -3.1% | -8.6% | -5.8% |
| |
|---|
| Median (9 companies) | -18.5% | -13.2% | 1.4% | -8.6% | -5.8% |
|---|
| Brightcove Inc. ($BCOV) | -11.3% | -26.9% | -19.0% | -24.8% | -5.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Limelight Networks, Inc. ($LLNW) | - | -1.7x | -1.8x | -0.4x | 5.7x |
| GoDaddy Inc. ($GDDY) | 2.3x | 6.8x | 3.9x | 3.4x | 4.9x |
| Akamai Technologies, Inc. ($AKAM) | 0.4x | 0.5x | 0.7x | 2.0x | 1.8x |
| VeriSign, Inc. ($VRSN) | 2.2x | 2.6x | 1.8x | 1.5x | 1.6x |
| Crexendo Inc ($CXDO) | - | - | - | -2.6x | -12.2x |
| |
|---|
| Median (5 companies) | 2.2x | 4.5x | 1.4x | 1.5x | 1.8x |
|---|
| Brightcove Inc. ($BCOV) | - | - | - | - | -2.6x |
