A few weeks ago, we announced strong business results and several key product developments for the first half of 2020. In this blog posting, I’d like to share more detail about some of these announcements but, I also wanted to talk a little more about the COVID-19 pandemic and the significant impact it has had on some of our customers. In fact, I wanted to share with you how some of our recent customers are using the Nuxeo Platform to enable digital transformation to not only continue to operate in these difficult times, but to move forward with critical business initiatives that will empower them to better compete now and in the future.
In case you missed our press release, let’s start with our recent announcements.
Continued Business Growth
I want to begin by saying that we are very grateful for customers’ faith in us and in our products, particularly under these trying circumstances. This has produced some very strong business outcomes for 1H’20.
For 1H’20, we were able to grow our revenue 33% year-over-year (YoY) and in Q2, we achieved 36% YoY revenue growth. In fact, over the four years since we received outside investment from Kennet and Goldman Sachs, we have grown our revenues by more than 3x, making Nuxeo the fastest-growing Content Services Platform in the market.
In 1H’20, new Annual Recurring Revenue (ARR) was up 54% YoY and ARR for our Nuxeo Cloud was up 72% YoY. Also, our Nuxeo Cloud offering is now 33% of our subscription revenue, a strong testament to the fact that we have now successfully operated our SaaS platform for three-plus years on Amazon Web Services.
Finally, we marked an important milestone in our business in Q2 and delivered our first EBITDA profit. This is a product of our continued growth and strong execution on our business plan and puts us in the enviable position of funding our own future growth.
Again, none of this happens without our valued customers, who continue to invest in the Nuxeo Platform. It also doesn’t happen without the Nuxeo team, which works tirelessly to make our platform the most innovative offering in the industry. This brings me to my next topic.
Ongoing Innovation at Nuxeo
In the first half of this year alone, Nuxeo delivered some really significant product enhancements:
- Nuxeo Insight - After an initial beta, our Artificial Intelligence in content management service went into full production deployment at the beginning of the year. We followed this up with an exciting, new point-and-click interface. Our new low-code interface enables business users to quickly and easily configure, train, deploy and operate custom machine-learning models using their own content and data.
- Retention Management - We also significantly enhanced our retention management capabilities. The Nuxeo Platform has long had foundational retention management capabilities that enable customers to enforce retention policies on content, lock vital records, apply legal holds, etc. In 1H’20, we focused on making it easier for records managers to administer these file plans and configure retention rules and policies. We also validated our Nuxeo Cloud offering with Amazon S3 Snaplock to comply with SEC 17a-4(f), a critical exercise for SEC-regulated customers who want to store trade-related content on AWS.
- Visual Designer - At Nuxeo, we believe that low-code development is the future of Content Services and Nuxeo Studio is a reflection of this belief. It’s already the most powerful configuration tool in our space and, in 1H’20, we introduced an entirely new visual design paradigm to make it even easier for Studio users to quickly build new user interfaces (UIs) for their content applications. Our new visual designer enables users to simply “drag and drop” various Nuxeo web components to configure a UI in mere minutes.
- Nuxeo Transformation Service - This is a new Cloud microservice that we introduced earlier this year as well. The Nuxeo Content Transformation service is designed to scale effortlessly to handle high-volume requirements for document transformations and asset renditions. This is particularly valuable for customers who are ingesting extremely high volumes of new assets or content into the Nuxeo Platform. We also plan to use Nuxeo Transformation as the backbone for our document viewer, to perform real-time PDF renditions for even the most intensive concurrent-user environments.
- Continuous Innovation - The last item is something that we haven’t talked about enough. Over the past year, we’ve been working to incorporate a continuous integration/continuous delivery (CI/CD) pipeline into our Cloud Content Management system. This represents a significant engineering investment, but the payoff for our customers and our Cloud operations team is massive. As we develop new features and capabilities for the Nuxeo Cloud, we can instantly release them to our Cloud customers, just like a proper SaaS offering.
The trick here is that we’re not an app, we’re a platform and our customers use Nuxeo to build complex and sometimes custom content applications. So, we’ve also incorporated a fully versioned API that will enable customers to easily deploy these new features and capabilities when they have been fully tested in their unique environments. Simply put, this will enable Cloud customers to stay current with our latest releases and take advantage of our newest features while, at the same time, ensuring that the release process itself is not disruptive to their businesses.
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Helping Our Customers Achieve a Digital Advantage
As I noted previously, our growth is a product of our customers and it is our innovation that continues to give them great faith in us as a company and in our technology. But what really matters is what customers do with our technology and the transformational impact that the Nuxeo Platform has on their businesses. Here are a couple examples: one for digital asset management and one for content management.
A large, multi-brand apparel company is using our technology to digitally transform their supply chain.
Much more than a simple asset repository for Marketing, the Nuxeo Platform is helping them to accelerate product design life cycle and development, linking critical product data with digital assets, including 3D product models. Their CEO has publicly stated that their corporate objective is to be 100% digital by 2024. COVID-19 has created a number of interesting challenges for companies in the apparel industry.
One notable example is that it is nearly impossible to create new digital assets due to the complexities of executing photo shoots in a global pandemic. Recently, this customer implemented Nuxeo Insight to help them better mine their existing digital assets, generating new asset metadata and helping them to create new creatives campaigns utilizing new asset groupings.
In an entirely different industry and use case, a leading property & casualty insurer is using the Nuxeo Platform as a core component of a new, cloud-based insurance platform.
This company’s corporate objective is to become one of the largest P&C insurers in the world and had recently completed a number of large acquisitions. However, they were struggling to get planned efficiencies from these acquisitions due to varied, disconnected systems for processing claims and issuing new policies.
As a result, they took the strategic decision to implement an entirely new platform for claims and policies that they would standardize on across their various businesses. Of course cloud was an important part of the equation and, in this case, AWS was their chosen cloud infrastructure provider. And Nuxeo, Guidewire, and SmartCOMM were their chosen, next-generation technologies upon which they are building their new platform.
So, two examples of companies that are using our technology, along with others, to become more digital and to help deliver key corporate objectives. And two companies that are working to become more digital and seeking new ways of operating and achieving competitive advantage during these challenging times. Again, we are very grateful to all of our customers for their belief in us and our technology and for helping to drive our continued growth in 2020.