Zoomcar Holdings, Inc. (Nasdaq:
ZCAR)
(“Zoomcar,” the “Company,” “we,” or
“our”), the leading marketplace for car sharing in
emerging markets, today reported select financial results for the
third fiscal quarter ended December 31, 2023.
Management Commentary
“Our third fiscal quarter results capped a
strong performance in our ongoing efficiency efforts as we achieved
record gross profit and non-GAAP contribution profit while also
paving the way for meaningful revenue growth over the next several
quarters,” said Greg Moran, CEO and Co-Founder of Zoomcar. “The
period also marked an important milestone with our public listing
on Nasdaq following our successful business combination. As we look
ahead to 2024, we expect a meaningful return to growth with
materially improved profitability as we now have the right
infrastructure in place to scale our operations efficiently.”
Zoomcar continues to make significant progress
across the Company’s strategic priorities:
- Make vehicle Hosting
mainstream: We’re focused on making vehicle Hosting just
as popular as renting a Zoomcar, and we believe we’re making
continuous progress to this end. Active vehicle listings hit 10.3K
in FQ3 2023 as we continue to see double-digit supply growth across
all major regions within India. In FQ3 2023, Zoomcar Hosts earned
approximately $4 million. We’ll continue to raise awareness around
Hosting through brand marketing investments and external
third-party partnerships, while improving the Host’s onboarding
journey and their overall experience on the platform.
- Perfect the core guest
experience: We are intensely focused on technology-driven
product innovation to improve the overall booking experience for
our community of guests. In FQ3 2023 alone, we launched more than
20 new features and upgrades that, among others, help improve
vehicle listing discoverability, improve price comparison
capabilities, enhance sort/filter abilities within search, and
revamp the payment experience at checkout.
- Expand beyond
India: We are making steady progress in our efforts to
expand beyond India. Egypt continues to scale bookings while
building toward a sustainable non-GAAP contribution margin at the
country level. In Indonesia we remain focused on building the
appropriate mix of supply to attract higher volumes of demand to
the platform on a consistent basis. We remain committed to further
investment into these markets across 2024 and look forward to
exploring additional opportunities for new country expansion later
in the year.
Key Performance Indicators
("KPIs")
- FQ3 2023 marked a record
quarter in average transaction size across the Company.
Zoomcar achieved a record average transaction size of over $75 per
booking during the quarter. This performance showcases the
platform’s ability to leverage our internal AI models to drive
higher effective net pricing on behalf of our Hosts. Concurrently,
the platform also continues to enjoy a significant expansion in our
multi-day travel demand which drives effective trip durations
higher.
- Booked days and booked
guests have shown increased momentum in recent months.
Total booked days and booked guests were 163.9K and 68.1K,
respectively.
- We achieved a record in
active vehicle listings in FQ3 2023. Our active vehicle
listings reached 10.3K in FQ3 2023. We continue to witness growth
across Indian metros while observing a balanced mix of vehicle
segments associated with new listings. Consistent with earlier
trends in 2023, we see a consistently larger mix of professional
Hosts to the platform with the intent of leveraging the Zoomcar
platform as a micro-entrepreneurship opportunity.
- Platform quality continues
to improve at a steady pace. The platform’s average guest
trip rating was 4.50 on a 5-point scale in FQ3 2023. We believe
that this clearly demonstrates that our product focused approach to
the customer experience on the Zoomcar platform is continuing to
pay dividends. A constant focus on building tools to better improve
in-trip communication between guests and Hosts represented a
noticeable step function improvement in the overall in-trip
experience for both sets of customers on the platform.
Fiscal Third Quarter 2023 Financial
ResultsResults compare 2023 fiscal third quarter end
(December 31, 2023) to 2022 fiscal third quarter end (December 31,
2022) unless otherwise indicated. We are also presenting various
financial metrics under U.S. Generally Accepted Accounting
Principles (GAAP) and as adjusted (non-GAAP). A reconciliation of
GAAP to non-GAAP metrics appears at the end of this news
release.
- Net revenue
decreased 19% to $2.4 million, compared to $3.0 million in the same
period last year. The decrease in revenue was primarily due to a
lower number of days booked resulting in decreased gross billings
as the Company prioritized higher-margin bookings in support of its
cost reduction efforts.
- Gross profit
increased to a record $0.3 million, compared to a gross loss of
$0.3 million in the same period last year. The increase in gross
profit was a result of trip fulfillment cost reductions driven by
collective improvements in efficiency and lower Host
accident-related reimbursements that consistently showed
improvement over fiscal 2023.
- Operating expenses
(excluding G&A costs) decreased 24%, to $2.2 million,
compared to $2.9 million in the same period last year. The decrease
in operating expenses was a result of a decrease in sales and
marketing costs and technology and development costs.
- GAAP net income
was $14.4 million, compared to an $8.7 million net loss in the same
period last year. The improvement in net loss was the result of a
one-time deSPAC transaction gains of $28.9 million associated with
financial instrument conversions at fair market value. During the
period, the Company also improved its gross margin profile and
recorded a reduction in Host accident-related reimbursements.
- Gross booking
value (“GBV”) was $6.5 million, compared to $8.3 million
in the same period last year. The decrease in GBV was a result of
our focus on booking level profitability (contribution margin)
improvements at the expense of volume growth.
- Contribution
profit (non-GAAP) was $0.2 million, compared to a
contribution loss of $0.7 million in the same period last year,
driven by reductions in cost of revenue due to the overall
improvements in operational efficiency as well as lower host
incentives and marketing costs. FQ3 2023 was the Company’s first
full quarter of positive contribution profit and marked a
consistent quarter-over-quarter effort to achieve this result.
- Adjusted EBITDA
loss (non-GAAP) was $4.0 million, compared to $5.2 million
in the same period last year. The improvement in adjusted EBITDA
reflects broad-based cost reduction and efficiency initiatives that
reduced cost of revenue, technology and development costs, and
operating expenses.
- As of December 31, 2023, the
Company had total negative working capital of $26.2 million,
including $6.1 million in cash.
Calendar 2024 Financial
Outlook
Based on initial performance in calendar year
2024 to-date as well as anticipated business growth expected in the
coming months, the Company projects net revenue to range between
$17.0 million and $20.0 million for the calendar year ended
December 31, 2024, representing an increase of approximately 70% to
100% compared to calendar year 2023.
The Company also expects to achieve an
annualized adjusted EBITDA run rate between $2.0 million and $4.0
million in calendar Q4 2024.
About ZoomcarFounded in 2013
and headquartered in Bengaluru, India, Zoomcar is a leading
marketplace for car sharing focused on emerging markets. The
Zoomcar community connects Hosts with guests, who choose from a
selection of cars for use at affordable prices, promoting
sustainable, smart transportation solutions in growing markets.
Non-GAAP Financial MeasuresTo
supplement our financial statements, which are presented on the
basis of U.S. generally accepted accounting principles (GAAP), the
following non-GAAP measures of financial performance are included
in this release: contribution margin, earnings before interest,
taxes, depreciation and amortization (EBITDA), and adjusted EBITDA.
A reconciliation of GAAP to adjusted non-GAAP financial measures is
included as an attachment to this press release.
We believe these non-GAAP financial measures are
useful to investors in assessing our operating performance. We use
these financial measures internally to evaluate our operating
performance and for planning and forecasting of future periods. We
also believe it is in the best interests of investors to provide
this non-GAAP information.
While we believe these non-GAAP financial
measures provide useful supplemental information to investors,
there are limitations associated with the use of these non-GAAP
financial measures. These non-GAAP financial measures may not be
reported by competitors, and they may not be directly comparable to
similarly titled measures of other companies due to differences in
calculation methodologies. The non-GAAP financial measures are not
an alternative to GAAP information and are not meant to be
considered in isolation or as a substitute for comparable GAAP
financial measures. They should be used only as a supplement to
GAAP information and should be considered only in conjunction with
our consolidated financial statements prepared in accordance with
GAAP.
Forward Looking
StatementsCertain statements contained in this press
release are not historical facts and may be forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Words such as "plans," "expects," "believes,"
"anticipates," "designed," and similar words are intended to
identify forward-looking statements. These forward-looking
statements include, but are not limited to, statements concerning
our expected revenue growth and improved profitability, our
investment into markets in which we currently operate and our
expansion into new markets and our financial forecasts for calendar
year 2024. Forward-looking statements are based on our current
expectations and beliefs, and involve a number of risks and
uncertainties that are difficult to predict and that could cause
actual results to differ materially from those stated or implied by
the forward-looking statements. A description of certain of these
risks, uncertainties and other matters can be found in filings we
make with the U.S. Securities and Exchange Commission, all of which
are available at www.sec.gov. Because forward-looking statements
involve risks and uncertainties, actual results and events may
differ materially from results and events currently expected by us.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
We undertake no obligation to publicly update these forward-looking
statements to reflect events or circumstances that occur after the
date hereof or to reflect any change in its expectations with
regard to these forward-looking statements or the occurrence of
unanticipated events.
Media Contacts:
Gateway Group, Inc.
(U.S.)ZCAR@gateway-grp.com(949) 574-3860
ZoomcarBhagyashree Rewatkar
bhagyashree.rewatkar@zoomcar.com
Reconciliation of GAAP to Non-GAAP
Metrics
Gross Booking Value
We define Gross Booking Value, or GBV, as the
total dollar value of Booking Days booked on our platform,
including upfront booking fee (less discounts and credits),
value-added fees (i.e., trip protection fees), Guest and Host
platform fees, and other charges. GBV includes applicable
pass-through taxes and other fees required to be remitted to local
authorities, which are excluded from net revenue. GBV is driven by
the number of Booking Days and related trip pricing. Revenue from
bookings is recognized ratably over the duration of the trip;
accordingly, we consider GBV a “leading indicator” of revenue.
The following is a reconciliation of adjusted
EBITDA to the most comparable GAAP measure, net (Loss) /
Income:
|
|
Three months endedDecember
31, |
|
|
Nine months endedDecember
31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net Income / (Loss) |
|
$ |
14,425,439 |
|
|
$ |
(8,712,700 |
) |
|
$ |
(26,757,978 |
) |
|
$ |
(32,173,920 |
) |
Add/ (deduct) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SPAC transaction closing costs |
|
|
6,143,324 |
|
|
|
1,073,906 |
|
|
|
7,061,350 |
|
|
|
1,197,856 |
|
Stock-based compensation |
|
|
1,265,828 |
|
|
|
493,135 |
|
|
|
1,883,733 |
|
|
|
3,132,467 |
|
Depreciation and amortization |
|
|
244,050 |
|
|
|
291,301 |
|
|
|
754,658 |
|
|
|
604,661 |
|
Finance costs |
|
|
8,392,470 |
|
|
|
1,296,445 |
|
|
|
13,628,832 |
|
|
|
2,862,702 |
|
Finance costs to related parties |
|
|
12,426 |
|
|
|
10,674 |
|
|
|
38,203 |
|
|
|
79,081 |
|
Other income, net |
|
|
(34,503,014 |
) |
|
|
390,414 |
|
|
|
(10,377,735 |
) |
|
|
(1,280,105 |
) |
Other income from related parties |
|
|
(5,548 |
) |
|
|
(2,393 |
) |
|
|
(11,224 |
) |
|
|
(12,122 |
) |
Adjusted EBITDA |
|
$ |
(4,025,025 |
) |
|
$ |
(5,159,218 |
) |
|
$ |
(13,780,161 |
) |
|
$ |
(25,589,380 |
) |
|
Adjusted EBITDA is a non-GAAP financial measure
that represents our net income or loss adjusted for (i) provision
for income taxes; (ii) other income and (expense), net; (iii)
depreciation and amortization; (iv) stock-based compensation
expense; (v) finance costs’ and (vi) deSPAC transaction closing
costs.
Contribution Profit /
(Loss)
|
|
Three months endedDecember
31, |
|
|
Nine months endedDecember
31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net revenue |
|
$ |
2,421,438 |
|
|
$ |
2,981,600 |
|
|
$ |
7,717,064 |
|
|
$ |
6,677,727 |
|
Cost of revenue |
|
$ |
2,093,057 |
|
|
$ |
3,318,466 |
|
|
$ |
8,441,525 |
|
|
$ |
17,376,553 |
|
Gross Profit |
|
$ |
328,381 |
|
|
$ |
(336,866 |
) |
|
$ |
(724,461 |
) |
|
$ |
(10,698,826 |
) |
Add: Depreciation and amortization in COR |
|
|
205,260 |
|
|
|
90,498 |
|
|
|
624,630 |
|
|
|
294,522 |
|
Add: Stock-based compensation in COR |
|
|
51,848 |
|
|
|
60,783 |
|
|
|
134,883 |
|
|
|
574,846 |
|
Add: Overhead costs in COR (rent, software support,
insurance, travel) |
|
|
249,651 |
|
|
|
655,720 |
|
|
|
988,946 |
|
|
|
1,595,951 |
|
Less: Host Incentives and Marketing costs (excl. brand
marketing) |
|
|
626,267 |
|
|
|
1,196,500 |
|
|
|
2,104,360 |
|
|
|
4,502,985 |
|
Less: Host incentives |
|
|
73,216 |
|
|
|
593,301 |
|
|
|
348,261 |
|
|
|
1,588,200 |
|
Less: Marketing costs (excl. brand marketing) |
|
|
553,051 |
|
|
|
603,199 |
|
|
|
1,756,099 |
|
|
|
2,914,785 |
|
Contribution Profit / (Loss) |
|
|
208,873 |
|
|
|
(726,365 |
) |
|
|
(1,080,362 |
) |
|
|
(12,736,492 |
) |
Contribution margin |
|
|
9 |
% |
|
|
-24 |
% |
|
|
-14 |
% |
|
|
-191 |
% |
|
We define contribution profit (loss) as our
gross profit plus (a) depreciation expense included in cost of
revenue, (b) stock-based compensation expense included in cost of
revenue, (c) other general costs included in cost of revenue (rent,
software support, insurance, travel); less (i) Host incentive
payments and (ii) marketing and promotional expenses (excluding
brand marketing).
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