yext-20210430

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2021


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38056

YEXT, INC.

(Exact name of registrant as specified in its charter)


Delaware						20-8059722
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

61 Ninth Avenue

New York, NY 10011

(Address of principal executive offices, including zip code)

(212) 994-3900

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

YEXT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act). Yes ☐ No ☒

As of May 24, 2021, the registrant had 126,243,515 shares of common stock, $0.001 par value per share outstanding.

TABLE OF CONTENTS


			PAGE
PART I.		FINANCIAL INFORMATION
	Item 1	Financial Statements	5
		Condensed Consolidated Balance Sheets (U naudited)	5
		Condensed Consolidated Statements of Operations and Comprehensive Loss (U naudited)	6
		Condensed Consolidated Statements of Stockholders' Equity (U naudited)	7
		Condensed Consolidated Statements of Cash Flows (U naudited)	8
		Notes to Condensed Consolidated Financial Statements	9
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3	Quantitative and Qualitative Disclosures About Market Risk	26
	Item 4	Controls and Procedures	27

PART II.		OTHER INFORMATION
	Item 1	Legal Proceedings	28
	Item 1A	Risk Factors	28
	Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	52
	Item 3	Defaults Upon Senior Securities	52
	Item 4	Mine Safety Disclosures	52
	Item 5	Other Information	52
	Item 6	Exhibits	52

SIGNATURES

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains, and our officers and representatives may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risks and uncertainties. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words "believe," "may," "will," "potentially," "estimate," "continue," "anticipate," "plan," "intend," "could," "would," "expect" and similar expressions that convey uncertainty of future events or outcomes are intended to identify forward-looking statements. Forward-looking statements included in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding:

•our future revenue, cost of revenue, operating expenses and cash flows;

•anticipated trends, growth rates and challenges in our business and in the markets in which we operate;

•the effect of the novel coronavirus ("COVID-19") pandemic, including the effect of governmental restrictions and regulations as well as precautionary measures undertaken by businesses, on our business, operations, and financial results and the business and operations of our customers and potential customers;

•our beliefs, objectives and strategies for future operations, including plans to invest in international expansion, research and development, and our sales and marketing teams, and the impact of such investments on our operations;

•our ability to increase sales of our products;

•maintaining and expanding our end-customer base and our relationships with our Knowledge Network; and

•sufficiency of cash to meet cash needs for at least the next 12 months.

We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Part II, Item 1A "Risk Factors" in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and trends discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, whether written or oral, except as required by law.

In this Quarterly Report on Form 10-Q, the words "we," "us," "our" and "Yext" refer to Yext, Inc. and its wholly owned subsidiaries, unless the context requires otherwise.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

YEXT, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

(Unaudited)


	April 30, 2021		January 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	272,099	$	230,411
Accounts receivable, net of allowances of $2,246 and $2,528, respectively	55,512		97,455
Prepaid expenses and other current assets	16,454		17,993
Costs to obtain revenue contracts, current	32,145		30,325
Total current assets	376,210		376,184

Property and equipment, net	81,810		80,344
Operating lease right-of-use assets	102,456		104,844
Costs to obtain revenue contracts, non-current	26,380		22,692
Goodwill	4,828		4,842
Intangible assets, net	616		767
Other long term assets	6,373		6,316
Total assets	$	598,673	$	595,989
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable, accrued expenses and other current liabilities	$	50,885	$	54,186
Unearned revenue, current	186,614		191,810
Operating lease liabilities, current	14,285		14,165
Total current liabilities	251,784		260,161
Operating lease liabilities, non-current	120,583		123,584
Other long term liabilities	5,131		5,009
Total liabilities	377,498		388,754
Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock, $0.001 par value per share; 50,000,000 shares authorized at April 30, 2021 and January 31, 2021; zero shares issued and outstanding at April 30, 2021 and January 31, 2021	—		—
Common stock, $0.001 par value per share; 500,000,000 shares authorized at April 30, 2021 and January 31, 2021; 132,719,885 and 130,494,513 shares issued at April 30, 2021 and January 31, 2021, respectively; 126,214,551 and 123,989,179 shares outstanding at April 30, 2021 and January 31, 2021, respectively	132		130
Additional paid-in capital	765,147		733,933
Accumulated other comprehensive income	2,777		2,422
Accumulated deficit	(534,976)		(517,345)
Treasury stock, at cost	(11,905)		(11,905)
Total stockholders’ equity	221,175		207,235
Total liabilities and stockholders’ equity	$	598,673	$	595,989

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)

(Unaudited)


	Three months ended April 30,
		2021		2020
Revenue		$	91,992	$	85,351
Cost of revenue		21,854		21,184
Gross profit		70,138		64,167
Operating expenses:
Sales and marketing		55,166		58,520
Research and development		13,857		14,378
General and administrative		18,347		20,458
Total operating expenses		87,370		93,356
Loss from operations		(17,232)		(29,189)
Interest income		6		468
Interest expense		(132)		(137)
Other expense, net		(86)		(84)
Loss from operations before income taxes		(17,444)		(28,942)
(Provision for) benefit from income taxes		(187)		(282)
Net loss		$	(17,631)	$	(29,224)

Net loss per share attributable to common stockholders, basic and diluted		$	(0.14)	$	(0.25)
Weighted-average number of shares used in computing net loss per share attributable to common stockholders, basic and diluted		125,372,839		116,606,835

Other comprehensive income (loss):
Foreign currency translation adjustment		$	355	$	(1,333)

Total comprehensive loss		$	(17,276)	$	(30,557)

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Stockholders' Equity

(In thousands)

(Unaudited)


						Accumulated
				Additional		Other						Total
	Common Stock			Paid-In		Comprehensive		Accumulated		Treasury		Stockholders’
	Shares	Amount		Capital		Income (Loss)		Deficit		Stock		Equity
Balance, January 31, 2020	115,830	$	122	$	636,008	$	(360)	$	(422,653)	$	(11,905)	$	201,212
Exercise of stock options	3,064	3		16,513		—		—		—		16,516
Vested restricted stock units converted to common shares	4,358	4		(4)		—		—		—		—
Issuance of restricted stock	38	—		—		—		—		—		—
Issuance of common stock under employee stock purchase plan	699	1		6,999		—		—		—		7,000
Stock-based compensation	—	—		74,417		—		—		—		74,417
Other comprehensive income	—	—		—		2,782		—		—		2,782
Net loss	—	—		—		—		(94,692)		—		(94,692)
Balance, January 31, 2021	123,989	130		733,933		2,422		(517,345)		(11,905)		207,235
Exercise of stock options	1,069	1		12,110		—		—		—		12,111
Vested restricted stock units converted to common shares	871	1		(1)		—		—		—		—
Issuance of restricted stock	4	—		—		—		—		—		—
Issuance of common stock under employee stock purchase plan	282	—		3,817		—		—		—		3,817
Stock-based compensation	—	—		15,288		—		—		—		15,288
Other comprehensive income	—	—		—		355		—		—

SEC Form 10-Q filed by Yext, Inc.