Matterport, Inc. (NASDAQ:MTTR) Q2 2023 Results Conference Call August 8, 2023 4:30 PM ET
Company Participants
Mike Knapp – VP, IR
RJ Pittman – Chairman and CEO
JD Fay – CFO
Conference Call Participants
Bhavin Shah – Deutsche Bank
Yun Kim – Loop Capital Markets
Operator
Good day, and welcome to the Matterport Incorporated Fiscal 2023 Second Quarter Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded.
I would now like to turn the conference over to Mr. Mike Knapp, VP of Investor Relations. Please go ahead.
Mike Knapp
Thanks. And welcome to Matterport’s second quarter 2023 financial results conference call. After the market closed today, Matterport released results for the third quarter ended June 30, 2023. The release is available on the Company’s website at investors.matterport.com. This call is being recorded and webcast live and a link to the recording can be found on the Investor Relations section of our website.
Before we begin, I would like to remind you that today’s call contains forward-looking statements within the meaning of federal securities laws including, but not limited to, statements regarding Matterport’s future financial results and management’s expectations and plans for the business. These forward-looking statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from those discussed on today’s call.
Additional information regarding the risks and uncertainties can be found in our filings with the SEC. All forward-looking statements are made as of the day of this call and Matterport assumes no obligation to update or revise them, except as required by law.
In addition, financial references on this call will be on a non-GAAP basis unless otherwise indicated. These measures should be considered as a supplement to and not as a substitute for GAAP financial measures. Reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP measure can be found in today’s earnings slides, which are available on the Company’s website.
Hosting today’s call are RJ Pittman, Chairman and Chief Executive Officer; and JD Fay, Chief Financial Officer.
And with that, I’d like to turn it over to RJ to begin.
RJ Pittman
Thanks Mike. Good afternoon, everyone, and thank you for joining us today.
Our 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. Our key metrics set new records with spaces under management hitting 10.5 million, and our subscriber base expanding to 827,000, reflecting steady growth in digital twin adoption. Our leading spatial data library has rapidly expanded to 33 billion square feet of physical space managed as customers are capturing larger spaces than ever with our Pro3 camera.
Businesses of all sizes continue to embrace our digital twin platform across the vertical markets we serve. Increasingly, they’re achieving significant productivity gains by employing Matterport software for facilities management, space planning and utilization by reducing the need for onsite travel and promoting efficient digital collaboration. This widespread adoption has propelled our subscription revenue to a record $20.9 million in Q2, at the high end of our guidance range for the quarter.
Our continued growth in revenue and our focus on operating efficiency has resulted in another quarter of strong outperformance on the bottom line with net loss per share of $0.07, more than a 40% improvement from a year ago. Moreover, our strategic partnerships continue to drive pipeline, connect us to large industry ecosystems, open new distribution channels, and help us enhance our platform’s functionality for customers. Our unmatched digital twin platform equips customers with crucial tools for managing and marketing their properties and facilities.
By harnessing our extensive spatial data library, we expect our new AI solutions will generate breakthrough customer value and bolster our subscription revenue per account. More on that in a moment.
In Q2 and early Q3, we implemented strategic changes across the organization to bolster execution of our company plan and fast track profitability. These changes included a significant modernization of our subscription and pricing structure to enable us to more effectively capture SaaS revenue while providing our customers with more value and flexibility.
Next, we introduced Genesis, a company-wide initiative to focus our AI efforts and push Matterport further to the forefront of the digital transformation of the built world. And in July, we announced a restructuring to accelerate our path to profitability while creating a leaner and faster moving organization. Each of these important steps accrue to our long-term strategy, which I’ve discussed previously and I would like to elaborate on further.
In the quarter, we rolled out updated subscription plans and pricing designed to unlock more value and provide better flexibility for our customers. Since we first introduced our subscription plans for Matterport digital twins in 2019, our customer base has experienced enormous growth to encompass diverse industries that use our platform in new and exciting ways. This has fueled rapid evolution of our cloud-based technology platform and expanded the functionality of every digital twin created retroactively. To keep pace, we announced new subscription plans that offer increased flexibility and encourage customers to grow their use of our digital twins while utilizing the rich features and functionality, we continuously add to our technology platform.
We’ve carefully updated our plans so customers can find the right subscriptions that fit their needs and budget. As a result of these updates, prices have increased across our standard subscription plans by approximately 7% to 11%. Feedback from customers following this update in may have been very encouraging, and we expect the pricing changes to begin to have a positive impact on subscription revenue over the coming months and carry into 2024.
Turning to technology, we have steadily expanded our AI first strategy with Cortex AI and Property Intelligence, leveraging our proprietary data set, the world’s largest library of digitized physical space.
Last quarter, we talked about property intelligence, our newest capability that documents and provides insights about the truth of a space as it exists today, such as providing automatic measurements or assessing the condition of a space or type of material. This fully automated offering generates powerful property insights to enable clients to easily manage their properties online and discover new operational efficiencies. It eliminates the need for multiple site visits and automates previously lengthy or manual workflows, enabling our customers to make better decisions more quickly from anywhere in the world.
Property Intelligence is the first product offering on our datafication roadmap and is currently being piloted with select customers. We expect to announce general availability later this year.
In June, we shared a first look at Genesis, an exciting new initiative that will combine property intelligence with generative AI and our spatial data library to offer a unique AI solution to the built world. Genesis will leverage our 33 billion square feet of digitized space to create one of the most powerful spatial computing platforms in the world for homeowners and property managers alike.
Genesis is designed to automate interior design, base planning, property management, and so much more for the spaces in which we live, work, and play. We plan to integrate Genesis across our digital twin platform with our first preview release expected by the end of the year. This defines a new generation of intelligent digital twins that harness AI to better understand and describe a space as it exists today and envision how a space could look and operate in the future. Matterport is the only digital twin platform that can deliver a breakthrough of this magnitude. Thanks to our decade long expertise in artificial intelligence and our market-leading 3D spatial data library.
Next up is efficiency. As mentioned, we accelerated our profitability timeline and enhanced efficiency through a workforce reorganization and reduction. The recent, these changes have already improved our focus, execution speed, and our aim to fast track our operational cash flow profitability to 2024, a year ahead of our previous plan.
As highlighted by our Q2 results, our core business remains strong, and our diverse end markets are demonstrating the resilience of our business model in the challenging real estate market. While challenging and especially difficult for those impacted by these actions, the decisive steps we’ve taken underscore our commitment and dedication to achieving profitability and fostering growth through any market conditions.
Before I hand it over to JD Fay to discuss our financials, I’d like to spend a few minutes updating you on the state of the industry and the incredible impact of our partnerships that are driving revenue growth and expanding our customer base.
Over the past few quarters, we’ve discussed important integrations with Amazon’s AWS IoT TwinMaker, which enables enterprise customers to seamlessly connect data into our digital twins. Our relationship with AWS is a significant validation of the value our digital twin platform brings to our shared customers like John Deere and INVISTA.
Amazon is also a valued channel partner and drives a significant volume of our hardware sales. In fact, this summer’s Amazon Prime Day promotion set a single day record for Matterport camera sales, for access Pro2, and our newest camera in the lineup Pro3.
Our longstanding trusted relationship with Amazon, a global leader in cloud services and e-commerce, continues to create valuable opportunities for our business and our customers.
Matterport’s strategic partnerships with leading enterprise software providers like AWS, Autodesk, PTC, Procore, and many others are kicking into high gear, generating a strong pipeline exiting the second quarter. This expands our presence in larger ecosystems, creating new distribution paths for our solutions, while improving our platform’s versatility and value for users, fueling our subscription revenue growth.
Our strategic integrations offer customers easy connections to top tier software, apps and services, simplifying workflows and reducing duplicate tasks. These integrations automate data syncing, saving time, and enabling a focus on creative rather than administrative tasks.
In the AEC industry, for instance, our integration with Building Information Modeling software or BIM helps streamline renovations and facilities management by connecting real world conditions with design processes. The technology landscape is fast-changing and Matterport stays nimble by integrating with mission critical software and platforms. This strategy keeps us attuned to the industry trends and transforms how customers use spatial data across various sectors and applications.
We’re also expanding our global reach by partnering with major distributors like CompuSoluciones in Latin America, and Equinox Technologies in the Middle East, Africa and Asia Pacific. Mexico’s industrial market boasts over 900 million square feet of building space with construction, reaching a 2022 peak of 43 million square feet, while real estate projects in the Gulf Cooperation Council countries amount to $1.4 trillion this year. These vast regions present immense opportunities for us. Our new distributors will supply enterprises and small to medium sized businesses with Matterport’s top tier digital twin platform and Pro3 and Pro2 cameras, enhancing their global operational efficiency.
Recently, we also extended our long-term relationship with idealista, Southern Europe’s largest online real estate platform through a multi-year agreement. A strong testament to our partnership and commitment to keeping the European real estate industry moving forward amidst challenging property market conditions worldwide.
As we know, the U.S. residential real estate market is experiencing lower than typical existing home sales volume. Existing home sales were lower by 18% in the second quarter on a seasonally adjusted annual basis. Despite this, Matterport has continued to show strength with nearly 660,000 new digital twins on our platform in the quarter, a majority of which are related to residential real estate.
Our new Digital Pro all-in-one content marketing package continues to be well received as well, with over 100% sequential growth from the last quarter when it was launched. Moreover, real estate brokerages and agents are increasingly convinced of the value of using Matterport with their listings. 74% of real estate agents report that they win more listings when they offer Matterport digital twins, which is important in today’s market of low inventory and heightened agent competition for those listings. Matterport’s precision digital twins increase engagement with potential buyers, boosting online interactions by 300%. Two separate studies found that homes sell up to 31% faster with a Matterport digital twin in the listing.
We anticipate that AI tools like Property Intelligence will introduce new subscription revenue opportunities in real estate and other sectors such as construction and facilities management. These tools enable customers to gain insights from data obtained from current or future imagined Matterport digital twins.
Finally, should inflation and interest rates begin to improve, U.S. existing home sales volume is expected to increase by 17% next year, and we’re well-placed to drive rapid growth in this market with all of our innovative new offerings in the lineup.
I would now like to turn it over to JD Fay to discuss our financial performance for the second quarter and the outlook for Q3 and the full year 2023.
JD Fay
Thank you, RJ. For the second quarter, we delivered 39% total revenue growth year-over-year, reaching $39.6 million, which was at the high end of our guidance range. The strength in our revenue was across subscription, services and product categories with subscription and services revenue, both achieving new records in the quarter. Subscription revenue rose to $20.9 million in the quarter, which was up 13% from the year-ago period, also at the high end of our guidance range.
In addition, our annual recurring revenue grew to $83.5 million. We saw growth in both enterprise and small to medium business customers, and in all three of our geographic operating regions with double-digit growth in Europe, the Middle East, and Asia. Of our record, 827,000 subscribers at the end of the second quarter, we had 758,000 free subscribers and 69,000 paid subscribers. Free subscribers grew by 37%, and paid subscribers grew by 11% compared to the year ago period. These growth rates were roughly equal to the average of our growth rates over the past year.
Our net dollar expansion rate was 100% in Q2. The net dollar expansion rate for SMB customers grew sequentially, while the enterprise cohort was impacted by a large contract with a public sector customer that was completed in the quarter. Absent this impact, the net dollar expansion rate for the quarter would have been flat sequentially at 103%. Approximately 50% of our subscription revenues derived from non-real estate customers. We continue to see strong double-digit growth in markets like construction, travel and hospitality, facilities management and insurance, balanced with modest growth in real estate.
Services revenue for the second quarter was $10.7 million, a new record and more than double in the year ago period. Customers continue to embrace capture services where we perform the capture and onboarding of digital twins into subscription accounts for the customer. In addition, we saw continued adoption of our add-on services, including our BIM and floor plan offerings, our TruePlan offering for insurance, adjusting, as well as growth in our digital property marketing solutions. Our product revenue was $8 million in the second quarter, up 58% from the year ago period. This was primarily driven by continued demand for our new Pro3 camera.
Moving on to gross margin. Our total gross margin for the second quarter was 47% compared to 48% in a year ago period. Our subscription gross margin was 75%, up from 72% in the year ago period. This increase was the result of efficiency related investments that we made over the past year relating to customer support and the processing and hosting of customer data on our cloud platform, which we are now realizing.
Product gross margin was 2% in the second quarter, up from negative 37% in the year ago period. The improvement was primarily the result of the resolution of the supply chain challenges that we experienced last year. Product gross margin would have been 14% without additions to our E&O reserve we recorded in the quarter. We expect that product gross margin will improve to the mid-teens for the balance of 2023.
Turning to operating expenses, research and development was $10.6 million, down 20% from the year ago period. This change in R&D resulted from rigorous evaluation and reduction of spending towards offerings that we expect will yield the highest returns, reflecting our commitment to operate more efficiently as we continue to drive innovation in our technology platform.
SG&A expenses for Q2 were $31.9 million, down 10% from the year ago period. This reduction in spending was primarily related to lower sales and marketing expenses as we instill further efficiency and discipline across our operations.
The result is a second quarter non-GAAP net loss of $21.5 million and non-GAAP loss per share of $0.07, $0.01 above the midpoint of our guidance range. This is a 42% improvement in bottom line performance from the year ago quarter. I’m very pleased with the significant progress on the bottom line as we are actively driving the Company to achieve profitability. Our weighted average share count was 298 million shares.
Moving on to the balance sheet, we ended the quarter with $446 million in cash and investments, down just 2% from the prior quarter, and we remain debt-free. Our cash used in operations improved to $12.4 million in the second quarter, which is a 62% improvement from the year ago period. Annualizing our Q2 run rate would allow for nearly a decade of operations, but we are not stopping there. We are driving further improvements to achieve profitability in 2024.
Today, we are introducing financial guidance for the third quarter and providing our current view of full year 2023 financial guidance. We remain on track to deliver another record year for the Company as we grow the top line and improve profitability metrics. Strong customer adoption outside of real estate and our increasing focus on profitability has resulted in an improving outlook for non-GAAP net loss per share for both the third quarter and full year of 2023.
With respect to our restructuring initiative, we expect to incur charges of $4 million to $5 million on a GAAP basis with a majority of these charges incurred in the third and fourth quarters. Importantly, this initiative pulls our operating cash flow breakeven targets forward by one year to 2024.
Our subscription revenue remains healthy and our expectations for growth for this line item are unchanged. We continue to experience strong demand in vertical markets, including construction, travel and hospitality, facilities management and insurance. We are also demonstrating that we can grow in residential real estate. We expect, however, continuing softness in the U.S. residential real estate market generally through the remainder of this year, modestly impacting our estimates for product and services revenue.
Accordingly, for the third quarter, we expect total revenue to be in the range of $38 million to $40 million and subscription revenue to be in the range of $21.8 million to $22 million. This represents 15% annual growth at the midpoint of the range for subscription revenue. We expect the balance of revenue to be split roughly evenly between the services and product revenue line. We anticipate third quarter non-GAAP loss per share to be in the range of $0.05 to $0.07.
We have also tightened our full year 2023 total revenue range, which is now $155 million to $159 million. We have tightened our expectations for full year 2023 subscription revenue to be in the range of $85 million to $86 million. This represents 16% annual growth at the midpoint of the range for subscription revenue. For the full year of 2023, we expect a $0.24 to $0.28 non-GAAP loss per share. This represents an improvement of $0.03 at the midpoint compared to the guidance we articulated last quarter and a 37% improvement from 2022.
We have taken specific and measurable actions to sharpen our strategic focus and accelerate our path to profitability. We have dramatically improved our cash flow from operations and there is more to come. At the same time, we will continue to execute on our plan to grow revenue by helping customers increase productivity, reduce their costs, and get work done faster and more efficiently with more valuable Matterport solutions centered around AI-driven data insights and digital twins for the built world.
Now, I would like to turn the call back over to RJ.
RJ Pittman
Thanks, JD. Our robust Q2 results reflect the rising demand for our innovative digital twin platform solution, counteracting the challenges in the residential and commercial real estate markets. From small businesses to Fortune 1000 companies, our platform is crucial for delivering cost savings and enhancing operational efficiency and productivity. The digital transformation of the built world is unfolding now with Matterport providing instant ROI by automating some of the costliest and least efficient on-location management tasks.
The responsive operational changes we recently enacted at Matterport, though challenging, affirm our commitment to fostering a sustainable business centered on long-term growth and profitability. Matterport has proven to be an indispensable tool to help drive real estate, even when the markets are down. Our continued growth in this economic climate will further boost our market leadership as the markets stabilize and start to improve.
Today our enterprise growth is brisk, and Matterport is capitalizing on the momentum by doubling down on innovation for growth, with powerful AI-driven technologies like Cortex and Genesis. We’re working hard to fully harness the power of our 33 billion square feet of spatial data through datafication. And I have immense faith in our team and our technology to deliver on the enormous potential of the $327 trillion built world.
Thank you for joining us today. Operator, we are now ready for questions.
Question-and-Answer Session
Operator
Thank you. We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Bhavin Shah from Deutsche Bank. Please go ahead.
Bhavin Shah
Great. Thanks for taking my questions. Just wanted to kind of circle back on those pricing and packaging changes that you guys kind of announced a couple of months ago. Can you just elaborate a little bit more on the customer reception you’ve seen there? Have you kind of seen any changes to retention or churn rates, customers kind of moving over to the annual plan and just any way to size the impact of these changes and what that might be to your current ARR base over the next several quarters? Thanks so much.
RJ Pittman
Thanks for the question, Bhavin. I’ll start and JD can follow-up with some of the financial detail. First and foremost, this is a project that has been many quarters in the making and something that we enlisted the participation and support of some of our longest standing customers. And that’s a very important principle here at Matterport, customer centricity.
And as we mentioned on the call, pricing changes are a delicate and important thing to get right. And in our case, it was very clear that pricing changes had to be commensurate with bringing at least as much incremental value to the Matterport platform for our customers. And in fact, going beyond that, and we have worked really hard over the last several years to do so. And we’ve added so much value to the platform without any changes to pricing in the last four to five years that we had some room to move here. And by enlisting the support of our customers in the process, we really think we hit the bull’s eye. The response has been very positive. And in fact, early trends — and we’re in the early days of this are also exceeding our expectations, including great strength in customers moving up to the annual plan because they are seeing the value and the value proposition equation now that we’ve incorporated into the new modern design of the plans and that continued value add that we’re bringing to the platform and which we’re not done doing, right? We will be bringing more value to the platform and to these subscription holders throughout this year and the years ahead.
So, out of the gates, I couldn’t be more pleased with how the team has managed this deployment, and really, really staying close to our customers along the way. JD, you want to add to that?
JD Fay
Yes. Thanks, RJ. Yes, in terms of kind of the behavior of customers in response to the new pricing, retention has been very good, and it’s been within our expectations, in fact, slightly better than our expectations. We expected a slight uptick in churn which did occur but that was actually offset by more customers than we’d expected converting to annual plans in response to the pricing updates. And then, of course, those conversions to annual plans are, and that positive, it lowers volatility in MRR and of course it accelerates cash because they’re prepaid. So, overall, it’s gone as well or better than our expectations. And feedback, as RJ mentioned, has been good.
Over the longer term, as we go into 2024, I can see this adding about $1 million a quarter just as a result of the price change to the MRR line, which we’ve included in our guidance already.
Bhavin Shah
Got it. That’s helpful. And I want to just make sure I understand it. So, like, your current guidance already incorporates some of this pricing impact, but that still will layer in over time as well, right? So, the $1 million quarter should start smaller and kind of layer into the model over the next four quarters plus. Is that the best way to think about it?
RJ Pittman
Yes. That’s a good way to think about it.
Bhavin Shah
Awesome. Just so a quick follow-up. Just in terms of your total revenue guidance, it seems like your subscription is almost kind of unchanged. In terms of the delta you’re seeing from what you guys were guiding previously, it sounds like it’s more on the services and product side. Can you just help us understand exactly what you’re seeing in those areas and what impacts you’re seeing just from the residential market? Thanks.
RJ Pittman
Go ahead, JD.
JD Fay
Sure. Yes. I can start on that one. And in terms of the guidance, you’re right. First, the subscription revenue estimates are unchanged. That line remains healthy as we’ve talked about on the prepared remarks. And we’ve tightened the range as we normally do, as we get toward the back half of the year. And that’s a 16% year-over-year increase at that guide. You’re right, that services and product revenue are where the changes reside. They’re actually quite small, very modest to just 3% from the midpoint of our previous guidance. So, it is almost immaterial, but we did update it in light of some of the activity we’re seeing here now and in Q3. And that’s driven largely from two areas. One is, of course, as we’ve talked about, there is some influence from the U.S. residential real estate market on those line items. But also we of course implemented a pretty significant restructuring that we had talked about. And while this allows us to go faster and be more efficient, it does reduce to some degree our capacity. And so, we reflected in our guidance those adjustments.
Ultimately, it drives a faster path to profitability. It improves our bottom-line, which we see here today in the Q2 results, and that’s going to keep going. So, we think it’s the right change to have made in light of the macro as well as where the opportunities are ahead of us. So, it’s a slight change on the services and product line, just 3% and really doesn’t change the overall trajectory of this business, or the fact that we can deliver another record year this year.
Operator
Your next question comes from Yun Kim from Loop Capital Markets. Please go ahead.
Yun Kim
Thank you. Congrats on a solid quarter, RJ and JD. First, RJ, high level, long-term strategic question for you. Currently your business model is more driven by number of pay spaces for your subscription business, but that doesn’t necessarily account for the true intrinsic value of your proprietary data. So, in today’s gen AI world, where data is the new oil, what are some of the ways that you can start unlocking the value of your data beyond the number of pay spaces? I know you already have products that monetize on the data such as data insights and obviously Genesis. But if you can just explain what are some of the new ways that you’re thinking about in terms of monetizing the data?
RJ Pittman
Thanks, Yun. I appreciate the question. And you’re right. As we’ve said for many years now, the long-term strategy and vision for the Company is come for the digital twin and stay for the property insights. And the more digital twins that we capture and bring onto our platform, the more data we have, from which to analyze and apply emerging AI technologies towards, to create new insights for properties and for customers that were not previously even thought possible. And yes, you’ve heard about some of the early opportunities with property intelligence, and right off the bat, that’s going to be a very powerful step in that direction for monetization because, some of the value will be inherent in the base platform, but many of these will manifest in the form of premium features and add-ons — add-ons to your subscription revenue that allow you to take much more control of your digital twin. And first is being able to automatically understand much more about the digital twin than you get today from Matterport. Let our software do the analysis for you. And you’ll see more of this, as property intelligence comes out in beta later this year and ultimately to full general release.
And where Genesis goes is a step further. Give us a base digital twin and then let software, artificial intelligence and automation allow you to now do things that you would ordinarily hire professionals for, interior design, base planning, virtually stage a property for marketing or reimagine the layout and even create an addition or an extension to an existing property all in software. And the way that that becomes possible is by training your software, training your machine learning and deep learning technologies and engines against a rich set of data. And there are very few companies out there that have the kind of spatial data that Matterport has in the library, or just talk about the 33 billion square feet of space. It’s literally trillions of 3D data points. And it is an enormous amount of property data, of property types and spaces of all kinds and sizes from factories to commercial spaces, and of course, every type of residential property on the planet, now covering nearly 180 countries in the world.
That data set represents a tremendous proving ground for us, that is going to be lasting because the technology curve that we are on today with data science and AI is still in its infancy. And so, this is going to provide a very robust long-term roadmap of value added features to come. And property intelligence is right on the doorstep slated for 2023 in Genesis, fueled by generative AI and some of the most emerging cutting edge capabilities for 2024.
That’s going to create a compounding effect of software only additions to the digital twin you already have. So, even a property that you might have scanned and digitized with us five years ago is in line to benefit from all of these technologies that we’re going to build in the coming years. So, we’re really excited about this. It creates a very high margin expansion story and growth story for the Company.
Yun Kim
Okay. As always, thanks for the very thorough answer, RJ. So another question for you, with the recent risk, has there been any material change to your go-to-market, especially around your enterprise business? For instance, are you focusing on any particular vertical more given the current environment or less focus on certain verticals given the current environment, and also, if you could just comment on the overall interaction that you’re having with the technology partners like Autodesk and also AWS?
RJ Pittman
Sure. First and foremost on the go-to-market, we have done much more than just a restructuring. We are rewiring the go-to-market, rewiring execution at Matterport for focus and speed. And one of those areas is how we attack the enterprise opportunity in the global theater in a more consistent way. So, we’ve combined efforts, we’ve put together our enterprise teams and our go-to-market teams under a consolidated roof, so that we’re going to be running largely, a unified playbook and we’re going to be using best practices where our techniques for going to market and getting the fastest, most efficient market share has worked best for us. And we’re going to use that playbook as we’ve done in the past, but now we’re going to do it, universally, we’re going to do it globally with a team that has come together to work on this as one unit, as one global group. There will be teams, of course, continuing with boots on the ground, supporting our customers where they are in our three regions of Europe, Asia, and the Americas. But we’re going to do it now with tremendous efficiency. And also again with a singular playbook that’s been proven to work, we’ve been honing it here in the U.S. over the last couple of years. And we’re really ready to take it to market in this new fashion. So, that’s number one.
Number two, related to the partnerships that we are building, these are critical for us, because companies like Autodesk and Amazon and Procore and PTC and many others, we’ve built over the years have been a key source of generating our enterprise and mid-market customer pipeline. As you’ve heard us talk about before, we’ve got now more than 25% of the Fortune 1000, but many, many more enterprises and mid-market customers than that. And that’s been the result of building these partnerships over many years that has entrenched Matterport in these industries, like AEC, the retail industry, the insurance category, and the like. That takes definitely a number of challenges off the table of marketing and selling directly to those customers, and rather capitalizing on the channels that have been established by these much larger companies ahead of us.
We’ve been seeing great pipeline growth amidst a challenging market environment and have been absolutely, due to the strength of not just the partnerships but the kind of innovation that we’re bringing to both of them, enabling platforms like Autodesk and Amazon to go further and offer value propositions to their customers that were just never possible before for the very easy, very quick to integrate solution.
Operator
[Operator Instructions] As there are no further questions, this concludes our question-and-answer session at this time. I would now like to turn the conference over back to Mr. Knapp for any closing remarks.
Mike Knapp
Great. Thanks everyone for joining us today. As always, we appreciate your interest in Matterport, and we look forward to speaking with you on our next earnings call. Thanks and goodbye.
Operator
The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.
Read the full article here
