Loading...
•
Mar 31, 2022
Rekor Systems Q1 2022 Earnings Report
Reported a decrease in revenue but an increase in recurring revenue due to new sales model.
Key Takeaways
Rekor Systems reported a decrease in overall revenue for Q1 2022 compared to Q1 2021, but experienced significant growth in recurring revenue. The company is focusing on subscription contracts and expanding its customer base through strategic initiatives and potential acquisitions.
Recurring revenue increased by 96% compared to the same quarter last year.
Total revenue decreased due to a shift towards subscription-based contracts.
The company announced its intent to acquire Southern Traffic Services (STS).
Rekor Systems was selected for Amazon Web Services Partner Network and Public Sector Partner Program.
Rekor Systems
Rekor Systems
Forward Guidance
Rekor anticipates strong contributions from channel partners and organic growth, along with potential M&A prospects to expand revenues, capabilities, and market presence. The company expects recurring revenue growth in future periods.
Positive Outlook
- Strong contributions from channel partners expected.
- Potential M&A prospects to expand revenues.
- Recurring revenue growth expected in future periods.
- Rekor One platform continues to provide momentum for go-to-market strategy.
- Acquisition of STS would be accretive to Rekor’s earnings immediately upon closing.
Challenges Ahead
- Decrease in total contract value and performance obligations.
- Pilot programs have lower margins due to upfront costs.
- Shift in emphasis from point-in-time revenue has had a near term impact on overall revenues.
- Operating expenses increased significantly.
- Gross revenue decreased compared to the same quarter last year.