Upland Software Reports 10% Revenue Decline, Improved Profitability in Q3 2024

Upland Software, Inc. reported its financial results for the three and nine months ended September 30, 2024, revealing a decline in total revenue and ongoing net losses, although improvements in profitability metrics were noted compared to the previous fiscal period.

For the third quarter of 2024, Upland Software generated total revenue of $66.7 million, a decrease of 10% from $74.1 million in the same quarter of 2023. The decline was primarily attributed to a reduction in revenue from Sunset Assets, which fell by $4.7 million. Subscription and support revenue also decreased by $1.3 million, while professional services revenue dropped by $0.9 million. For the nine-month period, total revenue was $206.8 million, down 8% from $225.7 million in the prior year, again largely due to declines in Sunset Assets and core subscription services.

Despite the revenue drop, Upland Software reported a gross profit of $47.0 million for Q3 2024, down from $51.2 million in Q3 2023, but maintaining a gross profit margin of 70%. Total operating expenses for the quarter decreased to $50.3 million from $58.9 million, contributing to a reduced net loss of $(1.7 million) compared to $(8.7 million) in the same quarter of 2023. The net loss attributable to common stockholders also improved to $(3.1 million) from $(10.0 million) year-over-year.

For the nine months ended September 30, 2024, Upland reported a net loss of $(109.3 million), an improvement from $(163.9 million) in the same period of 2023. The net loss per common share for the nine months was $(4.07), down from $(5.17) in the prior year.

The company’s total assets decreased significantly to $554.9 million as of September 30, 2024, from $870.0 million at the end of 2023, primarily due to a reduction in cash and cash equivalents, which fell to $59.7 million from $236.6 million. This decline was attributed to share repurchases totaling $11.0 million and substantial debt repayments of $181.1 million.

Upland Software also recognized a goodwill impairment of $87.2 million during the nine months, reflecting a decline in stock price affecting market capitalization. The company has not made any new acquisitions since 2022 and reported no acquisition-related expenses for the current period.

In terms of strategic developments, Upland authorized a stock repurchase program in September 2023, which was completed in May 2024, repurchasing 6.4 million shares. The company is also focused on enhancing its product offerings through potential acquisitions of complementary technologies.

Overall, while Upland Software faced challenges with revenue declines, it demonstrated improved profitability metrics and strategic financial management during the reporting period.