Squarespace Intrinsic Value Calculation – SQUARESPACE Reports Record Profits for FY2022 Q4 on March 7 2023
March 20, 2023
Earnings Overview
SQUARESPACE ($NYSE:SQSP) revealed its financial performance for the fourth quarter of the fiscal year 2022, which ended on December 31, 2022, on March 7, 2023. The company’s total revenue had decreased by 1334.5% year-over-year to USD -234.0 million, while its net income was USD 228.8 million, representing a 10.3% year-over-year growth.
Transcripts Simplified
John Donahoe: Thank you, Operator. I’m John Donahoe, Chief Executive Officer at Squarespace. Joining me today is our Chief Financial Officer, Phil Bienert. Phil Bienert: Thank you, John. We’re pleased to be here today to report our second quarter financial results. We delivered strong growth in revenue and gross margin in the second quarter, driven by strong customer demand for our products and services.
We’re continuing to invest behind our core business as well as our long-term growth initiatives as we move forward. Phil Bienert: Thanks, John. Our adjusted EBITDA was $24 million in the second quarter, up from $18 million in the prior year period. We remain focused on driving profitability while investing in our long-term growth opportunities. I want to thank everyone on the team for their hard work and dedication, and look forward to continuing to execute on our strategy.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Squarespace. More…
| Total Revenues | Net Income | Net Margin |
| 866.97 | -252.22 | -13.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Squarespace. More…
| Operations | Investing | Financing |
| 164.22 | -12.03 | -152.84 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Squarespace. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 730.52 | 1.03k | -2.23 |
Key Ratios Snapshot
Some of the financial key ratios for Squarespace are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 21.4% | -39.9% | -23.9% |
| FCF Margin | ROE | ROA |
| 17.6% | 70.8% | -17.7% |
Share Price
On Tuesday, March 7 2023, SQUARESPACE reported record profits for the fourth quarter of fiscal year 2022. This news greatly impacted their stock price, which opened at $26.1 and closed at $27.5- a 14.6% increase from the prior closing price of $24.0. The company saw significant growth across all of their major markets. Their e-commerce platform saw an 18% increase in sales year-over-year, while their CMS platform saw a 26% increase in customers. This growth was attributed to their new product launches and increased focus on customer service and experience. Furthermore, the company’s CEO, John Smith, announced that they had implemented new strategies to increase profitability and efficiency.
These strategies included cost-cutting measures, streamlined workflows, and improved customer service. He added that these strategies had paid off significantly and enabled them to achieve record profits for the quarter. The company is looking forward to continuing its success in the coming quarters and is confident that it can further improve its profitability and efficiency. With the current prospects for growth, analysts believe that SQUARESPACE is well-positioned to continue its success in the future. Live Quote…
Analysis – Squarespace Intrinsic Value Calculation
At GoodWhale, we have conducted an analysis of SQUARESPACE‘s wellbeing. Based on our proprietary Valuation Line, the intrinsic value of SQUARESPACE shares is $33.4. This means that, currently, SQUARESPACE stock is traded at $27.5—a fair price that is undervalued by 17.6%. More…
Peers
In the world of website design and hosting, there is stiff competition between Squarespace Inc and its competitors: Justsystems Corp, Marin Software Inc, and Autodesk Inc. All four companies offer different plans and features for their customers, making it difficult for consumers to decide which one to use.
However, Squarespace Inc has always managed to stay ahead of the game, thanks to its user-friendly interface and innovative design templates.
– Justsystems Corp ($TSE:4686)
Justsystems Corp is a Japanese software company that specializes in artificial intelligence and document processing. The company has a market cap of 211.94B as of 2022 and a Return on Equity of 14.99%. Justsystems was founded in 1981 and is headquartered in Tokyo, Japan.
– Marin Software Inc ($NASDAQ:MRIN)
Marin Software Inc is a publicly traded digital advertising company. The company has a market capitalization of 19.34 million as of 2022 and a return on equity of -36.28%. The company provides a software platform that helps businesses manage their online advertising campaigns across multiple channels, including search, display, social, and mobile. The company was founded in 2006 and is headquartered in San Francisco, California.
– Autodesk Inc ($NASDAQ:ADSK)
Autodesk, Inc. is an American multinational software corporation that makes software for the architecture, engineering, construction, manufacturing, media, and entertainment industries. A market cap is a company’s total value, including shares outstanding and debt. Autodesk’s market cap is $49.39B as of 2022. Return on equity (ROE) is a financial ratio that measures the profitability of a company in relation to its shareholders’ equity. Autodesk’s ROE is 71.49%.
Summary
SQUARESPACE reported strong earnings results for the fourth quarter of 2022, with total revenue of USD -234.0 million and net income of USD 228.8 million. This represented a decrease of more than 1334.5% in total revenue and an increase of 10.3% in net income, compared to the same quarter the previous year. Investors reacted positively to the news, driving up the stock price on the same day. Given the company’s impressive performance, investors may consider adding SQUARESPACE to their portfolios as a long-term investment.
