Matterport Reports 39% Revenue Growth in Q2 as it Inches Towards Profitability

The spatial data company Matterport has reported its results for the second quarter of the financial year. Highlights from a three-month period in which the Silicon Valley firm managed to beat guidance, included:

• The number of subscribers was up 34% on the comparison period at 827,000.
• Q2 revenue was up 39% at $39.6 million representing the 5th consecutive quarter of guidance-beating revenue.
• Net loss was $21.5 million (Q2 2022 $35.3 million).

The narrative around Matterport has shifted over recent years. During the worst of the pandemic, the company and its technology that allows people to tour properties virtually were seen as a proptech darling. Matterport floated on the Nasdaq in July 2023 via a SPAC deal with great expectations.

Since then the company's unit economics have come under scrutiny as Matterport lost $117 million on a Non-GAAP Net basis in 2022 and saw its share price drop from $14 at float to as low as $2.3 per share in April 2023.

Despite laying off a reported 170 employees last month (30% of its total workforce), company Executive Chairman and CEO, RJ Pittman was bullish in comments made in a press release accompanying Matterport's Q2 results:

"The second quarter execution was pivotal for the company this year. We delivered record subscription and services revenue while doubling-down on our efficiency initiatives to deliver step function productivity gains in the second half of 2023. Total revenue for the quarter grew to nearly $40 million, fueled by strong enterprise adoption and steady improvements with our small and medium-sized businesses.”

Despite the layoffs and the heavy losses, Matterport has now beaten its own guidance for revenue for five straight quarters and, according to CFO JD Fay, the company's relatively strong performance in subscriptions is propelling it toward profitability.

“Our continued growth in total and subscription revenue as well as commitment to streamlining operations have propelled us to another quarter of exceptional bottom-line outperformance, delivering Non-GAAP loss per share toward the top end of guidance,” added JD Fay, Chief Financial Officer of Matterport.

“Looking forward, our recent restructuring aims to fast-track our path to operational cash flow profitability to 2024, a full year ahead of our previous plan. These difficult and decisive steps reflect our dedication to constructing a sustainable business emphasizing long-term growth and profitability.”

Matterport, which counts real estate portal operators such as CoStar Group and Idealista among its clients, is looking to AI to fuel its next growth phase.

The company recently announced Genesis, a new initiative to deliver generative AI across the Company’s digital twin platform. Genesis seeks to answer questions like "How many people could we fit on this floor with an open floor plan?"