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Mar 31, 2024
Stem Q1 2024 Earnings Report
Stem announced its first quarter 2024 results, which included a substantial increase in CARR-to-ARR conversion and the introduction of a next-generation asset performance management software suite. The company reaffirmed its full-year 2024 guidance for operating cash flow, adjusted EBITDA, gross margin, and bookings.
Key Takeaways
Stem's first quarter 2024 results showed a revenue decrease to $25.5 million due to a $33 million non-cash adjustment, but the company achieved a record non-GAAP gross margin and improved adjusted EBITDA year-over-year. They are accelerating the conversion of CARR-to-ARR and reaffirming full-year guidance for adjusted EBITDA and operating cash flow.
Revenue decreased to $25.5 million, impacted by a $33 million reduction due to updated contract guarantee valuations.
Non-GAAP gross margin increased to 24% from 19% in Q1 2023.
Bookings were $23.8 million, reflecting variability from large, utility-scale projects.
Contracted backlog was $1.6 billion, after efforts to upgrade profitability.
Stem
Stem
Forward Guidance
The company is updating its full year 2024 guidance ranges. They reaffirm full year 2024 revenue projected quarterly performance.
Positive Outlook
- Reaffirming guidance for adjusted EBITDA
- Reaffirming guidance for operating cash flow
- Maintaining bookings target of $1.5-$2.0 billion for 2024
- Expecting meaningful year-over-year growth in software services revenue.
- Focus on strengthening balance sheet.
Challenges Ahead
- Full year revenue guidance has been adjusted downward dollar-for-dollar solely as a result of the $33 million reduction in revenue.
- Revenue $567 - $667 million
- Non-GAAP Gross Margin (%) 15% - 20%
- Adjusted EBITDA $5 - $20 million
- CARR (year-end) $115 - $130 million