NEW YORK & VIENNA, Va.--(BUSINESS WIRE)--Kaleyra Inc. (NYSE American: KLR) ) (KLR WS) a rapidly growing cloud communications software provider delivering a secure system of application programming interfaces (APIs) and connectivity solutions in the API/Communications Platform as a Service (CPaaS) market, today announced financial results for the third quarter ended September 30, 2020.

“We exceeded our revenue guidance and delivered our strongest quarter ever, fueled by the expanded functionality of our platform and strong customer relationships. We saw significant growth in the US along with a modest improvement in our two largest markets, Italy and India, and we continue to invest in our people and technology in order to attract innovative companies to our platform as well as foster deep, multi-faceted relationships with existing enterprise customers,” commented Dario Calogero, Kaleyra’s Founder and Chief Executive Officer. “Looking ahead, we continue to be optimistic about the growth opportunities and believe we can continue the momentum provided by our expanded go-to-market teams and our robust platform of flexible APIs.”

Third Quarter 2020 Financial Highlights

• Revenue: Total revenue for the third quarter of 2020 was $38.3 million, a 23% increase when compared to Q2’s $31.2 million and up 8% compared to $35.3 million in the third quarter of 2019.
• Gross Profit: Gross profit for the third quarter of 2020 was $7.5 million, a 72% increase when compared to Q2’s $4.4 million and up 7% compared to $7.0 million for the third quarter of 2019. Gross margin for the third quarter of 2020 was 20%, in line with the third quarter of 2019, which signals a return to pre-COVID performance.
• Net Loss: Net loss for the third quarter of 2020 was $5.3 million, or $(0.19) per share, based on 28.3 million weighted average shares outstanding. Q3 is a 35% improvement when compared to Q2’s net loss of $8.1 million. During the third quarter of 2019, net income was $0.8 million, or $0.08 per share, based on 10.7 million fully diluted weighted average shares outstanding.
• Adjusted EBITDA comparable to previous year: Adjusted EBITDA comparable to previous year was $2.8 million for the third quarter of 2020, compared to $3.5 million for the third quarter of 2019. The decline in adjusted EBITDA is attributed to the increased investments, predominantly in engineering talent, that have been made to execute on emerging growth opportunities to develop and deliver new products and services.
• Liquidity: As of September 30, 2020, cash and cash equivalents were $31.5 million. Cash used in operating activities was $9.6 million in the third quarter of 2020, mainly due to working capital changes, compared with cash provided by operating activities of $2.6 million in the third quarter last year.
• Liabilities: Total liabilities were reduced by $38.6 million since December 31, 2019.

Recent Business Highlights

• Delivered 6.3 billion billable messages, which was in line with the previous period, and connected 1.1 billion voice calls, up 22% period over period.
• Launched Verified Calls Services for Google. The Verified Calls feature for Android phones enables customers to see the name of the enterprise calling them as well as the reason for the call. This is an important new feature at a time when spam calls are an increasing problem for businesses and consumers.
• Kaleyra Executed a Warrant Exchange Agreement. The Company issued an aggregate of 850,500 shares of Common Stock in exchange for the surrender and cancellation of 3.78 million warrants (NYSE American: KLR WS) previously issued by the Company as part of its initial public offering in December 2017 (the “Public Warrants”). The agreement reduced the total number of outstanding Public Warrants by approximately 35%, to 7.0 million from 10.8 million.
• Kaleyra's subsidiary, Campaign Registry Inc., a systems initiative to reduce spam by collecting robotically driven campaign information and processing and sharing that information with mobile operators and the messaging ecosystem, was launched during the quarter. For more information visit www.campaignregistry.com/.
• Kaleyra expanded its connectivity service footprint, entering contracts with five of the world's largest OTT (Over-the-Top) Internet media and App services companies to deliver messaging traffic globally.

Financial Outlook

Kaleyra’s outlook assumes that the Company’s largest markets, Italy and India, will continue to see improvements in their economies coming out of the COVID-19 pandemic. It also takes into consideration that there could still be continued pressure on transaction levels in certain regions and on certain business lines. As of November 9, 2020, Kaleyra is providing guidance for its fourth quarter and full year 2020 as follows:

• Fourth Quarter 2020 Guidance: Total revenue is expected to be in the range of $41.5 $42.5 million, absent an accelerated wave of COVID-19 cases and shutdowns.
• Full Year 2020 Guidance: Total revenue is expected to be in the range of $144.6 - 145.6 million, above are previous guidance.

About Kaleyra Inc.

Kaleyra, Inc. (NYSE American: KLR) (KLR WS), is a global group providing mobile communication services for financial institutions and enterprises of all sizes worldwide. Through its proprietary platform, Kaleyra manages multi-channel integrated communication services on a global scale, comprising of messages, push notifications, e-mail, instant messaging, voice services and chatbots. Kaleyra’s technology today makes it possible to safely and securely manage billions of messages monthly with a reach to hundreds of MNOs and over 190 countries. For more information: https://www.kaleyra.com/.