First off, Smartsheet is not yet profitable and it will take some time before they become consistently profitable. SMAR has been spending a lot of money to develop its platform and acquire new customers. SMAR's focus right now is not profits, rather it wants to achieve scale and grow the top line.
On the positive side, its non-GAAP loss of $(0.07) was well above prior guidance of $(0.15)-(0.13). Revenue rose 58.2% yr/yr to $52.2 mln, which also was above prior guidance of $49-50 mln. Subscription revenue is a key metric for SMAR and that came in at $46.5 mln, an increase of 56% yr/yr. In terms of guidance, SMAR expects a Q1 (Apr) non-GAAP loss of $(0.19)-(0.18) and revenue of $54-55 mln. Revenue was upside but EPS was downside.
For the full year, revenue rose 60% to $177.7 mln. SMAR ended the year with over 4.8 mln users including more than 800,000 paid licensed users and nearly 79,000 domain customers. The company has been working at its goal to sign up larger deals. The number of all customers with annualized contract values (ACV) of $50,000 or more grew to 444, an increase of 135% yr/yr. Average ACV per domain-based customer increased to $2,454, an increase of 50% yr/yr. Dollar-based net retention rate was 134% in FY19.
Looking ahead to FY20, SMAR is expecting another year of strong top-line growth: +42-45% to $253-257 mln. Losses are expected to continue, as investors expected. The focus again in FY20 will be top-line growth and customer acquisitions. Profits are not the priority but that's ok for SMAR's early growth stage.
In sum, after months of being range-bound in the $20-30 area, the stock has broken out in recent months, going from around $25 in early January to around $49 currently. These cloud-based workflow software stocks have been big winners of late. SMAR has been making a strong move.