GTY Technology Holdings Inc. (NASDAQ:GTYH) Q3 2019 Earnings Conference Call - Final Transcript

Nov 07, 2019 • 08:30 am ET

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GTY Technology Holdings Inc. (NASDAQ:GTYH) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Executive
Stephen Rohleder

to comment on our efforts to drive operational efficiencies across our business units and highlight a few projects we're working on to help the company standardize to scale. Our standardize to scale efforts are focused on standardizing key operating areas in an effort to help us quickly scale and improve productivity. One project in particular is our effort to standardize our financial and sales operations. First step in this project is to roll out a single ERP system and a single CRM system for all of the business units. We expect to be fully operational on our new NetSuite ERP system in Q4, which will help us close faster and provide key metrics and reporting to the businesses.

From a sales perspective, we'll be rolling out sales force across all of our business units in Q4. The broader sales force implementation is key as it gives us common CRM platforms across all of our businesses. As you can imagine, knowing that we have an existing customer relationship in a city or another entity, can be incredibly valuable even if we have different buyers.

I'd like to underscore that both of these systems projects are important as they allow us to more easily share information across the company, provide a more efficient foundation as we scale. With that I'd like to turn it back over to John to discuss our financials.

Executive
John Curran

Thanks, Steve. Moving on to our financial results for the quarter. Our GAAP revenue was $8.8 million in Q3 of '19 compared to $8.2 million in Q2 of '19 and $7.6 million in Q3 of '18. On a non-GAAP basis, revenue was $9.8 million for Q3 of '19 compared to $9.9 million in Q2 of '19 and $7.6 million in Q3 of '18. A reconciliation between our GAAP and non-GAAP results is included in Exhibit 2 of our press release. From a non-GAAP revenue perspective, we saw year-on-year revenue growth of 28%, which is slowed when compared to our growth in Q2 of '19.

We experienced a bit of a summer slowdown in July, but business really picked up as we went through August and September. Our bookings activity for the quarter was strong with three out of six companies setting new booking records for the quarter. On a non-GAAP quarter-on-quarter basis, revenue declined by 2%. As I mentioned our Q3 business was a bit back-end loaded, which impacted the amount of revenue we could earn in quarter from new contracts.

We also had a tough compare with Q2 of '19 as a result of seasonality in our payments business. Our CityBase business experiences higher transaction volume in Q2 and Q4 as a result of certain payment streams that occur on an annual or semi-annual basis, such as real estate -- real estate tax payment. We expect the transaction seasonality in CityBase will become less material over time as we scale and continue to build out our subscription business. Taking a look at our operating expenses. Our total GAAP expenses