Megaport (ASX:MP1) shares skyrocket after quarterly update

3 min read | July 20, 2022 02:38 PM AEST | By Sonal Goyal

Megaport (ASX:MP1) shares skyrocket after quarterly update — Image source: © Bluebay2014 | Megapixl.com

Key highlights of the fourth quarter of FY22

Image source: © Rawpixelimages | Megapixl.com

In the June quarter, the software and services company delivered a record MRR (Monthly Recurring Revenue) growth of 13%, increasing from AU$1.2 million in the previous quarter to AU$10.7 million. The weakening of the Australian dollar drove the MRR.

The group reported total revenue of AU$30.6 million, 10% up from the previous quarter.

Megaport said that the company delivered EBITDA profit for the first time for 4QFY22 as a whole. Group’s EBITDA was driven by the two new markets, Japan and Canada, which became profitable ahead of schedule. Vincent English, CEO, Megaport, said that the EBITDA profit was driven by the strong growth in new customers and increased service uptake.

In the stated period, the company sold 1,447 new services. In June 2022, average revenue per port increased by 7% quarter on quarter to AU$1,120 per month.

The customer acquisition remained strong during the quarter. The group reported more than 2,600 customers at the end of the quarter.

The company ended the quarter with a cash balance of AU$82.5 million.

Business update by Megaport

Megaport said it experienced strong interest from Mexican locals after the launch of its business in Mexico in April 2022. Ahead of the plan, core products were sold in the market via the KIO networks partnership.

Outlook

Megaport has a solid momentum while entering the FY23, Vincent English said in a statement. English said that the business is aligned to reduce cash burn. Also, the company have a clear pathway to profitability considering the proven business plan.

Looking at the record of executing business plans successfully, the CEO showed a high degree of confidence in the financial year 2023.

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