Slack Technologies Inc (NYSE:WORK) reported better-than-expected results for its first quarter, but withdrew its annual billings guidance. Amazon and Slack also announced a strategic partnership in a bid to compete with Microsoft’s Teams.
Slack and Amazon Web Services (AWS) will strategically partner to help distributed development teams communicate and become more efficient and agile in managing their AWS resources from inside Slack.
Slack is also leveraging AWS’s global infrastructure to support enterprise customers’ rapid adoption of its platform and to offer them data residency – the ability to choose which country or region their data is stored at rest in while fulfilling compliance requirements.
Meantime, on the company’s spreadsheet, revenues rose 50% to $201.7 million, a "phenomenal" quarter, said CEO Stewart Butterfield, who says the work-from home jolt will have an impact of "generational magnitude" and continue to catalyze adoption in the company's category.
Paid customers rose 28% to over 122,000; of them, 963 made up more than $100,000 in annual recurring revenue (up 49%). Net dollar retention rate was 132%.
Gross profit (non-GAAP) rose to $179.2M from $116.9M; gross margin rose to 88.9% from a year-ago 86.7%.
Operating loss was halved to $16.6M from a loss of $33.8M.
Net cash from operations was $8.7 million (4% of total revenue) vs. a year-ago use of cash of $14.1 million. Free cash flow was $3.7M (2% of revenue) vs. a year-ago -$34.2 million.
Slack shares began Friday down $6.83, or 18%, to $31.11.
