TechTarget, Inc. (NASDAQ:TTGT) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 05:00 pm ET

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TechTarget, Inc. (NASDAQ:TTGT) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good evening, and welcome to the TechTarget Q3 2019 Earnings Release Conference Call. [Operator Instructions]. Please note, this event is being recorded. I would like to now turn the conference over to Charles Rennick. Please go ahead.

Executive
Charles Rennick

Thank you, Jacob, and good afternoon. Joining me here today are Greg Strakosch, our Executive Chairman, Mike Cotoia, our CEO, and Dan Noreck, our CFO. Before turning the call over to Greg, I want to remind everyone on the call of our earnings release process. As previously announced, in order to provide you with an update on the business in advance of the call, we have posted our shareholder letter on the Investor Relations section of our website and furnished it on an 8-K.

Following Greg's introductory remarks, management team will be available to answer your questions. Any statements made today by TechTarget that are factual may be considered forward-looking statement. These forward-looking statements are based on assumptions and are not guarantees of our future performance. Actual results may differ materially from our forecast. Please refer to our Risk Factors and our periodic reports filed with the SEC. These statements speak only as of the date of this call, and TechTarget undertakes no obligation to update them. We may also refer to financial measures not prepared in accordance with GAAP. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures accompanies our shareholder letter.

With that, I'll turn the call over to Greg.

Executive
Gregory Strakosch

Great. Thank you, Charlie. We had another of very strong performance. This is the third consecutive call that we have raised the annual adjusted EBITDA forecast for 2019. Q3, 2019 revenues grew 10% to $33.8 million. Q3, 2019 adjusted EBITDA grew 45% to $11.1 million. For the first nine months of 2019, adjusted EBITDA grew 38% to $30.2 million.

Adjusted EBITDA margin was 33% in Q3, 2019 versus 25% in Q3, 2018. Adjusted EBITDA margin for the first nine months of 2019 was 31% versus 24% in the same time period in 2018. Gross margin was 76% in the quarter, same as last year. Adjusted cash flow was $8.1 million in the quarter, representing 72% of adjusted EBITDA. Long-term contracts represented 35% of revenue in Q3 2019. For Q4 2019, we expect revenues to be between $35 million and $36 million. We expect adjusted EBITDA for the fourth quarter of 2019 to be between $11 million and $12 million. We expect the annual revenues to be between $133 million and $134 million. And we expect adjusted EBITDA to be between $41 million and $42 million.

I will now open the call to questions.