Archives: Press Releases

Couchbase Appoints Julie Irish as Chief Information Officer

Couchbase Appoints Julie Irish as Chief Information Officer

SANTA CLARA, Calif. – March 07, 2024 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced the expansion of its executive leadership team with the appointment of Julie Irish as senior vice president and chief information officer. In this role, Irish will drive Couchbase’s global IT strategy in alignment with the company’s key business objectives.

Irish brings nearly 20 years of experience leading business operations, information technology, system implementation, migrations and strategic planning. She was most recently vice president of business applications and IT at New Relic where she scaled the function, led the delivery of complex IT projects and supported the company’s migration to a consumption-based business model. Before that, Irish held leadership positions at Harvard Business Publishing and startup RichRelevance. 

“Julie’s appointment marks a key milestone in the next phase of Couchbase’s expansion, and we’re very pleased to welcome her as our first CIO,” said Matt Cain, chair, president and CEO of Couchbase. “With an excellent track record and deep expertise in technology innovation, Julie’s leadership will further enable our world-class team as we scale beyond inflection and unlock the next phase of our growth with our database-as-a-service Couchbase Capella.”  

Irish will lead the global IT and security team and will set the strategy for systems and IT to position Couchbase’s internal infrastructure for future growth and effectiveness. Her extensive experience leading organizations through complexity and building strong business partnering teams will be essential in accelerating Couchbase’s business expansion while equipping the global team with improved systems, tools and processes.

“The strategic use of technology is critical to scaling across all functions to unlock growth. It’s an exciting time to join Couchbase as more customers transition to the Couchbase Capella offering and consumption models. Couchbase has built a strong technology foundation and I am honored to join the company contributing my insights, setting strategic priorities and collaborating with our world-class team,” added Irish.

Couchbase Announces Fourth Quarter and Fiscal 2024 Financial Results

Couchbase Announces Fourth Quarter and Fiscal 2024 Financial Results

Santa Clara, Calif., – March 5, 2024Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced financial results for its fourth quarter and fiscal year ended January 31, 2024.

“We finished fiscal 2024 on a strong note, highlighted by 25% ARR growth, and marking a historical year for Couchbase,” said Matt Cain, Chair, President and CEO of Couchbase. “In addition to delivering results that exceeded the high end of our guidance range on all metrics, we achieved an important milestone with Capella, which now represents 11% of our ARR and over 25% of our customer base. As we look ahead towards fiscal 2025, I’m confident that we have the differentiated platform and operational rigor to achieve our next phase of growth.”

Fourth Quarter Fiscal 2024 Financial Highlights

  • Revenue: Total revenue for the quarter was $50.1 million, an increase of 20% year-over-year. Subscription revenue for the quarter was $48.1 million, an increase of 26% year-over-year.
  • Annual recurring revenue (ARR): Total ARR as of January 31, 2024 was $204.2 million, an increase of 25% year-over-year as reported and on a constant currency basis. See the section titled “Key Business Metrics” below for details.
  • Gross margin: Gross margin for the quarter was 89.7%, compared to 85.7% for the fourth quarter of fiscal 2023. Non-GAAP gross margin for the quarter was 90.4%, compared to 86.3% for the fourth quarter of fiscal 2023. See the section titled “Use of Non-GAAP Financial Measures” and the tables titled “Reconciliation of GAAP to Non-GAAP Results” below for details.
  • Loss from operations: Loss from operations for the quarter was $22.6 million, compared to $18.5 million for the fourth quarter of fiscal 2023. Non-GAAP operating loss for the quarter was $4.1 million, compared to $9.9 million for the fourth quarter of fiscal 2023.
  • Cash flow: Cash flow used in operating activities for the quarter was $6.5 million, compared to $10.2 million in the fourth quarter of fiscal 2023. Capital expenditures were $1.3 million during the quarter, leading to negative free cash flow of $7.7 million, compared to negative free cash flow of $11.8 million in the fourth quarter of fiscal 2023.
  • Remaining performance obligations (RPO): RPO as of January 31, 2024 was $241.8 million, an increase of 46% year-over-year.

Full Year Fiscal 2024 Financial Highlights

  • Revenue: Total revenue for the year was $180.0 million, an increase of 16% year-over-year. Subscription revenue for the year was $171.6 million, an increase of 20% year-over-year.
  • Gross margin: Gross margin for the year was 87.7%, compared to 86.9% for fiscal 2023. Non-GAAP gross margin for the year was 88.5%, compared to 87.6% for fiscal 2023.
  • Loss from operations: Loss from operations for the year was $84.5 million, compared to $69.3 million for fiscal 2023. Non-GAAP operating loss for the year was $31.3 million, compared to $41.3 million for fiscal 2023.
  • Cash flow: Cash flows used in operating activities for the year were $26.9 million, compared to $41.2 million in fiscal 2023. Capital expenditures were $4.7 million during the year, leading to negative free cash flow of $31.6 million, compared to negative free cash flow of $46.8 million in fiscal 2023.

Recent Business Highlights

  • Announced vector search as a new feature in Couchbase Capella™ and Couchbase Server to help businesses bring to market a new class of AI-powered adaptive applications that engage users in a hyper-personalized and contextualized way. Couchbase is the first database company to announce it will offer vector search optimized for running onsite, across clouds and to mobile and IoT devices at the edge, paving the way for organizations to run adaptive applications anywhere, including offline.
  • Announced it is extending its AI partner ecosystem with LangChain and LlamaIndex support to further boost developer productivity. The integration with LangChain enables a common API interface to converse with a broad library of large language models (LLMs). Similarly, the integration with LlamaIndex will provide developers with even more choices for LLMs when building adaptive applications. These ecosystem integrations will accelerate query prompt assembly, improve response validation and facilitate retrieval-augmented generation (RAG)
  • Announced new enterprise features, including new file-based index rebalancing, reducing times by up to 80%, one-step upgrade from Couchstore to Magma storage engine without stopping the front-end workloads, faster failover times and query simplification. Couchbase continues to invest at a rapid pace to enhance its platform with new enterprise and developer features.
  • Announced the general availability of Capella iQ, a co-pilot for coding. Capella iQ allows developers to interact with Couchbase Capella using natural language conversation, making database interactions more intuitive, efficient and accessible.
  • Couchbase Capella was named Best Cloud Data Management Solution at the 2023-2024 Cloud Awards for its performance, versatility and community.

Financial Outlook

For the first quarter and full year of fiscal 2025, Couchbase expects:

Q1 FY2025 Outlook FY2025 Outlook
Total Revenue $48.1-48.9 million $203.0-207.0 million
Total ARR $206.5-209.5 million $235.5-240.5 million
Non-GAAP Operating Loss $8.5-7.5 million $27.5-22.5 million

 

The guidance provided above is based on several assumptions that are subject to change and many of which are outside our control. If actual results vary from these assumptions, our expectations may change. There can be no assurance that we will achieve these results.

Couchbase is not able, at this time, to provide GAAP targets for operating loss for the first quarter or full year of fiscal 2025 because of the difficulty of estimating certain items excluded from non-GAAP operating loss that cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant.

Conference Call Information

Couchbase will host a live webcast at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Tuesday, March 5, 2024, to discuss its financial results and business highlights. The conference call can be accessed by dialing 877-407-8029 from the United States, or +1 201-689-8029 from international locations. The live webcast and a webcast replay can be accessed from the investor relations page of Couchbase’s website at investors.couchbase.com.

About Couchbase

Modern customer experiences need a flexible database platform that can power applications spanning from cloud to edge and everything in between. Couchbase’s mission is to simplify how developers and architects develop, deploy and run modern applications wherever they are. We have reimagined the database with our fast, flexible and affordable cloud database platform Couchbase Capella, allowing organizations to quickly build applications that deliver premium experiences to their customers – all with best-in-class price performance. More than 30% of the Fortune 100 trust Couchbase to power their modern applications. For more information, visit www.couchbase.com and follow us on X (formerly Twitter) @couchbase.

Couchbase has used, and intends to continue using, its investor relations website and the corporate blog at blog.couchbase.com to disclose material non-public information and to comply with its disclosure obligations under Regulation FD. Accordingly, you should monitor our investor relations website and the corporate blog in addition to following our press releases, SEC filings and public conference calls and webcasts.

 

Use of Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, we believe certain non-GAAP financial measures are useful to investors in evaluating our operating performance. We use certain non-GAAP financial measures, collectively, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, may be helpful to investors because they provide consistency and comparability with past financial performance and meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook. Non-GAAP financial measures are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP, and may be different from similarly-titled non-GAAP financial measures used by other companies. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures (provided in the financial statement tables included in this press release), and not to rely on any single financial measure to evaluate our business.

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss and non-GAAP net loss per share: We define these non-GAAP financial measures as their respective GAAP measures, excluding expenses related to stock-based compensation expense, employer payroll taxes on employee stock transactions, restructuring charges and impairment of capitalized internal-use software. We use these non-GAAP financial measures in conjunction with GAAP measures to assess our performance, including in the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance.

Beginning with the fourth quarter of fiscal 2024, we have excluded the impairment of capitalized internal-use software, a non-cash operating expense, from our non-GAAP results as it is not reflective of ongoing operating results. This impairment charge relates to certain previously capitalized internal-use software that we determined would no longer be placed into service. Prior period non-GAAP financial measures have not been adjusted to reflect this change as we did not incur impairment of capitalized internal-use software in any prior period presented.

Free cash flow: We define free cash flow as cash used in operating activities less additions to property and equipment, which includes capitalized internal-use software costs. We believe free cash flow is a useful indicator of liquidity that provides our management, board of directors and investors with information about our future ability to generate or use cash to enhance the strength of our balance sheet and further invest in our business and pursue potential strategic initiatives.

Please see the reconciliation tables at the end of this press release for the reconciliation of GAAP and non-GAAP results.

 

Key Business Metrics

We review a number of operating and financial metrics, including ARR, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions.

We define ARR as of a given date as the annualized recurring revenue that we would contractually receive from our customers in the month ending 12 months following such date. Based on historical experience with customers, we assume all contracts will be automatically renewed at the same levels unless we receive notification of non-renewal and are no longer in negotiations prior to the measurement date. ARR also includes revenue from consumption-based cloud credits of Couchbase Capella products. ARR for Couchbase Capella products in a customer’s initial year is calculated as described above; after a customer’s initial year it is calculated by annualizing the prior 90 days of actual consumption, assuming no increases or reductions in usage. ARR excludes revenue derived from the use of cloud products only based on on-demand arrangements and services revenue. ARR should be viewed independently of revenue, and does not represent our revenue under GAAP on an annualized basis, as it is an operating metric that can be impacted by contract start and end dates and renewal dates. ARR is not intended to be a replacement for forecasts of revenue. Although we seek to increase ARR as part of our strategy of targeting large enterprise customers, this metric may fluctuate from period to period based on our ability to acquire new customers and expand within our existing customers. We believe that our ARR is an important indicator of the growth and performance of our business.

We also attempt to represent the changes in the underlying business operations by eliminating fluctuations caused by changes in foreign currency exchange rates within the current period. We calculate constant currency growth rates by applying the applicable prior period exchange rates to current period results.

 

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include, but are not limited to, quotations of management, the section titled “Financial Outlook” above and statements about Couchbase’s market position, strategies and potential market opportunities. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “continue,” “could,” “potential,” “remain,” “may,” “might,” “will,” “would” or similar expressions and the negatives of those terms. However, not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including factors beyond our control, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to: our history of net losses and ability to achieve or maintain profitability in the future; our ability to continue to grow on pace with historical rates; our ability to manage our growth effectively; intense competition and our ability to compete effectively; cost-effectively acquiring new customers or obtaining renewals, upgrades or expansions from our existing customers; the market for our products and services being relatively new and evolving, and our future success depending on the growth and expansion of this market; our ability to innovate in response to changing customer needs, new technologies or other market requirements, including new capabilities, programs and partnerships and their impact on our customers and our business; our limited operating history, which makes it difficult to predict our future results of operations; the significant fluctuation of our future results of operations and ability to meet the expectations of analysts or investors; our significant reliance on revenue from subscriptions, which may decline and, the recognition of a significant portion of revenue from subscriptions over the term of the relevant subscription period, which means downturns or upturns in sales are not immediately reflected in full in our results of operations; and the impact of geopolitical and macroeconomic factors. Further information on risks that could cause actual results to differ materially from forecasted results are included in our filings with the Securities and Exchange Commission that we may file from time to time, including those more fully described in our Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2023. Additional information will be made available in our Annual Report on Form 10-K for the year ended January 31, 2024 that will be filed with the Securities and Exchange Commission, which should be read in conjunction with this press release and the financial results included herein. Any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Investor Contact:

Edward Parker

ICR for Couchbase

IR@couchbase.com

Media Contact:

Michelle Lazzar

Couchbase Communications

CouchbasePR@couchbase.com

 

Couchbase, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
   Revenue:
      License $            7,196 $           4,977 $          21,514 $          19,885
      Support and other 40,865 33,158 150,040 123,010
        Total subscription revenue 48,061 38,135 171,554 142,895
         Services 2,028 3,488 8,483 11,929
         Total revenue 50,089 41,623 180,037 154,824
   Cost of revenue:
      Subscription(1) 3,580 3,214 14,647 10,762
      Services(1) 1,560 2,738 7,435 9,497
         Total cost of revenue 5,140 5,952 22,082 20,259
         Gross profit 44,949 35,671 157,955 134,565
   Operating expenses:   
      Research and development(1) 16,491 15,000 64,069 57,760
      Sales and marketing(1) 34,055 29,303 130,558 111,067
      General and administrative(1) 11,840 8,207 42,663 33,390
      Impairment of capitalized internal-use software 5,156 5,156
      Restructuring(1) 1,663 46 1,663
         Total operating expenses 67,542 54,173 242,492 203,880
         Loss from operations (22,593) (18,502) (84,537) (69,315)
   Interest expense (25) (43) (101)
   Other income (expense), net 1,766 1,938 5,752 1,960
         Loss before income taxes (20,827) (16,589) (78,828) (67,456)
   Provision for income taxes 575 25 1,355 1,038
   Net loss $         (21,402) $        (16,614) $         (80,183) $        (68,494)
   Net loss per share, basic and diluted $            (0.44) $           (0.37) $            (1.70) $            (1.53)
   Weighted-average shares used in computing net loss per share, basic and diluted 48,513 45,281 47,175 44,787

______________________________

(1) Includes stock-based compensation expense as follows:

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Cost of revenue—subscription $ 148 $ 144 $ 707 $ 535
Cost of revenue—services 116 116 529 433
Research and development 3,422 2,046 12,920 7,937
Sales and marketing 4,310 2,563 15,771 9,426
General and administrative 4,630 1,922 15,846 7,390
Restructuring 65 1 65
      Total stock-based compensation expense $ 12,626 $ 6,856 $ 45,774 $ 25,786

 

Couchbase, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

 

 

As of January 31, 2024 As of January 31, 2023
Assets
Current assets
   Cash and cash equivalents $           41,351 $            40,446
   Short-term investments 112,281 127,856
   Accounts receivable, net 44,848 39,847
   Deferred commissions 15,421 13,096
   Prepaid expenses and other current assets 10,385 8,234
      Total current assets 224,286 229,479
Property and equipment, net 5,327 7,430
Operating lease right-of-use assets 4,848 6,940
Deferred commissions, noncurrent 11,400 7,524
Other assets 1,891 1,666
      Total assets $          247,752 $          253,039
Liabilities and Stockholders’ Equity
Current liabilities
   Accounts payable $             4,865 $             1,407
   Accrued compensation and benefits 18,116 12,641
   Other accrued expenses 4,581 6,076
   Operating lease liabilities 3,208 3,117
   Deferred revenue 81,736 71,716
      Total current liabilities 112,506 94,957
Operating lease liabilities, noncurrent 2,078 4,543
Deferred revenue, noncurrent 2,747 3,275
      Total liabilities 117,331 102,775
Stockholders’ equity
   Preferred stock
   Common stock
   Additional paid-in capital 621,024 561,547
   Accumulated other comprehensive loss 56 (807)
   Accumulated deficit (490,659) (410,476)
      Total stockholders’ equity 130,421 150,264
      Total liabilities and stockholders’ equity $          247,752 $          253,039

 

Couchbase, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Cash flows from operating activities
Net loss $    (21,402) $    (16,614) $    (80,183) $   (68,494)
Adjustments to reconcile net loss to net cash used in operating activities
   Depreciation and amortization 390 867 2,424 3,171
   Stock-based compensation, net of amounts capitalized 12,626 6,856 45,774 25,786
   Amortization of deferred commissions 4,886 4,447 18,628 16,996
   Non-cash lease expense 762 757 3,075 2,909
   Impairment of capitalized internal-use software 5,156 5,156
   Foreign currency transaction (gains) losses 116 (774) 765 524
   Other (973) (593) (3,553) (416)
   Changes in operating assets and liabilities
      Accounts receivable (14,496) (16,941) (5,382) (3,537)
      Deferred commissions (10,937) (5,321) (24,829) (17,590)
      Prepaid expenses and other assets (3,111) (850) (2,274) (159)
      Accounts payable 1,712 (1,971) 3,447 (495)
      Accrued compensation and benefits 8,989 3,579 5,472 (3,497)
      Other accrued expenses 1,481 2,803 (1,516) 3,103
      Operating lease liabilities (828) (824) (3,389) (2,754)
      Deferred revenue 9,179 14,376 9,492 3,268
Net cash used in operating activities (6,450) (10,203) (26,893) (41,185)
Cash flows from investing activities
Purchases of short-term investments (40,704) (33,976) (131,160) (144,613)
Maturities of short-term investments 39,322 45,750 151,296 126,893
Additions to property and equipment (1,285) (1,553) (4,710) (5,646)
      Net cash provided by (used in) investing activities (2,667) 10,221 15,426 (23,366)
Cash flows from financing activities
Proceeds from exercise of stock options 3,580 1,189 10,933 5,222
Proceeds from issuance of common stock under ESPP 2,000 4,484
      Net cash provided by financing activities 3,580 1,189 12,933 9,706
      Effect of exchange rate changes on cash, cash equivalents and restricted cash (19) 458 (561) (397)
Net increase (decrease) in cash, cash equivalents and restricted cash (5,556) 1,665 905 (55,242)
Cash, cash equivalents, and restricted cash at beginning of period 47,450 39,324 40,989 96,231
Cash, cash equivalents, and restricted cash at end of period $     41,894 $     40,989 $     41,894 $     40,989
Reconciliation of cash, cash equivalents, and restricted cash
within the consolidated balance sheets to the amounts shown above:
Cash and cash equivalents $     41,351 $     40,446 $     41,351 $     40,446
Restricted cash included in other assets 543 543 543 543
Total cash, cash equivalents and restricted cash $     41,894 $     40,989 $     41,894 $     40,989

 

Couchbase, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share data)
(unaudited)

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Reconciliation of GAAP gross profit to non-GAAP gross profit:
Total revenue $ 50,089 $ 41,623 $ 180,037 $ 154,824
Gross profit $ 44,949 $ 35,671 $ 157,955 $ 134,565
Add: Stock-based compensation expense 264 260 1,236 968
Add: Employer taxes on employee stock transactions 61 5 147 41
Non-GAAP gross profit $ 45,274 $ 35,936 $ 159,338 $ 135,574
Gross margin 89.7 % 85.7 % 87.7 % 86.9 %
Non-GAAP gross margin 90.4 % 86.3 % 88.5 % 87.6 %

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Reconciliation of GAAP operating expenses to non-GAAP operating expenses:
GAAP research and development $            16,491 $            15,000 $            64,069 $            57,760
Less: Stock-based compensation expense (3,422) (2,046) (12,920) (7,937)
Less: Employer taxes on employee stock transactions (181) (27) (611) (165)
Non-GAAP research and development $            12,888 $            12,927 $            50,538 $            49,658
GAAP sales and marketing $            34,055 $            29,303 $          130,558 $          111,067
Less: Stock-based compensation expense (4,310) (2,563) (15,771) (9,426)
Less: Employer taxes on employee stock transactions (377) (76) (1,154) (294)
Non-GAAP sales and marketing $            29,368 $            26,664 $          113,633 $          101,347
 GAAP general and administrative    $            11,840 $              8,207 $            42,663 $            33,390
Less: Stock-based compensation expense (4,630) (1,922) (15,846) (7,390)
Less: Employer taxes on employee stock transactions (77) (8) (341) (106)
Non-GAAP general and administrative    $              7,133 $              6,277 $            26,476 $            25,894

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Reconciliation of GAAP operating loss to non-GAAP operating loss:
Total revenue $ 50,089 $ 41,623 $ 180,037 $ 154,824
Loss from operations $ (22,593) $ (18,502) $ (84,537) $ (69,315)
Add: Stock-based compensation expense 12,626 6,791 45,773 25,721
Add: Employer taxes on employee stock transactions 696 116 2,253 606
Add: Impairment of capitalized internal-use software 5,156 5,156
Add: Restructuring(2) 1,663 46 1,663
Non-GAAP operating loss $ (4,115) $ (9,932) $ (31,309) $ (41,325)
Operating margin (45) % (44) % (47) % (45) %
Non-GAAP operating margin (8) % (24) % (17) % (27) %

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Reconciliation of GAAP net loss to non-GAAP net loss:
Net loss $ (21,402) $ (16,614) $ (80,183) $ (68,494)
Add: Stock-based compensation expense 12,626 6,791 45,773 25,721
Add: Employer taxes on employee stock transactions 696 116 2,253 606
Add: Impairment of capitalized internal-use software 5,156 5,156
Add: Restructuring(2) 1,663 46 1,663
Non-GAAP net loss $ (2,924) $ (8,044) $ (26,955) $ (40,504)
GAAP net loss per share $ (0.44) $ (0.37) $ (1.70) $ (1.53)
Non-GAAP net loss per share $ (0.06) $ (0.18) $ (0.57) $ (0.90)
Weighted average shares outstanding, basic and diluted 48,513 45,281 47,175 44,787

_______________________________

(2) For the twelve months ended January 31, 2024 and the three and twelve months ended January 31, 2023, an immaterial amount of stock-based compensation expense related to restructuring charges was included in the restructuring expense line.

 

The following table presents a reconciliation of free cash flow to net cash used in operating activities, the most directly comparable GAAP measure, for each of the periods indicated (in thousands, unaudited):

 

Three Months Ended January 31, Year Ended January 31,
2024 2023 2024 2023
Net cash used in operating activities $ (6,450) $ (10,203) $ (26,893) $ (41,185)
Less: Additions to property and equipment (1,285) (1,553) (4,710) (5,646)
Free cash flow $ (7,735) $ (11,756) $ (31,603) $ (46,831)
Net cash provided by (used in) investing activities $ (2,667) $ 10,221 $ 15,426 $ (23,366)
Net cash provided by financing activities $ 3,580 $ 1,189 $ 12,933 $ 9,706

 

Couchbase, Inc.
Key Business Metrics
(in millions)
(unaudited)

 

As of
April 30, July 31, Oct. 31, Jan. 31, April 30, July 31, Oct. 31, Jan. 31,
2022 2022 2022 2023 2023 2023 2023 2024
Annual Recurring Revenue $ 139.7 $ 145.2 $ 151.7 $ 163.7 $ 172.2 $ 180.7 $ 188.7 $ 204.2
Couchbase Announces New Features to Accelerate AI-Powered Adaptive Applications for Customers

Couchbase Announces New Features to Accelerate AI-Powered Adaptive Applications for Customers

Couchbase is the first to announce vector search at the edge, enabling AI applications anywhere

Announcing LangChain and LlamaIndex support for greater developer productivity

Couchbase’s multipurpose database platform reduces architectural complexity to build trustworthy adaptive applications more quickly and easily 

SANTA CLARA, Calif. – Feb. 29, 2024 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today introduced vector search as a new feature in Couchbase Capella™ Database-as-a-Service (DBaaS) and Couchbase Server to help businesses bring to market a new class of AI-powered adaptive applications that engage users in a hyper-personalized and contextualized way. Couchbase is the first database platform to announce it will offer vector search optimized for running onsite, across clouds, to mobile and IoT devices at the edge, paving the way for organizations to run adaptive applications anywhere. 

“Adding vector search to our platform is the next step in enabling our customers to build a new wave of adaptive applications, and our ability to bring vector search from cloud to edge is game-changing,” said Scott Anderson, SVP of product management and business operations at Couchbase. “Couchbase is seizing this moment, bringing together vector search and real-time data analysis on the same platform. Our approach provides customers a safe, fast and simplified database architecture that’s multipurpose, real time and ready for AI.”

Vector Search and the Rise of Adaptive Applications

Businesses are racing to build hyper-personalized, high-performing and adaptive applications powered by generative AI that deliver exceptional experiences to their end users. Common use cases include chatbots, recommendation systems and semantic search. For example, suppose a customer wants to purchase shoes that are complementary to a particular outfit. In that case, they can narrow their online search for products by uploading a photo of the outfit to a mobile application, along with the brand name, customer rating, price range and availability at a specific geographical area. This interaction with an adaptive application involves a hybrid search including vectors, text, numerical ranges, operational inventory query and geospatial matching. 

As more organizations build intelligence into applications that converse with large language models (LLMs), semantic search capabilities powered by vector search — and augmented by retrieval-augmented generation (RAG) — are critical to taming hallucinations and improving response accuracy. While vector-only databases aim to solve the challenges of processing and storing data for LLMs, having multiple standalone solutions adds complexity to the enterprise IT stack and slows application performance. Couchbase’s multipurpose capabilities eliminate that friction and deliver a simplified architecture to improve the accuracy of LLM results. Couchbase also makes it easier and faster for developers to build such applications with a single SQL++ query using the vector index, removing the need to use multiple indexes or products. 

Couchbase’s recent announcement of its columnar service, together with vector search, provides customers with a unique approach that delivers cost-efficiency and reduced complexity. By consolidating workloads in one cloud database platform, Couchbase makes it easier for development teams to build trustworthy, adaptive applications that run wherever they wish. With vector search as a feature across all Couchbase products, customers gain:

  • Similarity and hybrid search, combining text, vector, range and geospatial search capabilities in one. 
  • RAG to make AI-powered applications more accurate, safe and timely. 
  • Enhanced performance because all search patterns can be supported within a single index to lower response latency. 

Strengthening AI Ecosystem Integrations 

In line with its AI strategy, Couchbase is extending its AI partner ecosystem with LangChain and LlamaIndex support to further boost developer productivity. Integration with LangChain enables a common API interface to converse with a broad library of LLMs. Similarly, Couchbase’s integration with LlamaIndex will provide developers with even more choices for LLMs when building adaptive applications. These ecosystem integrations will accelerate query prompt assembly, improve response validation and facilitate RAG applications. 

“Retrieval has become the predominant way to combine data with LLMs,” said Harrison Chase, CEO and co-founder of LangChain. “Many LLM-driven applications demand user-specific data beyond the model’s training dataset, relying on robust databases to feed in supplementary data and context from different sources. Our integration with Couchbase provides customers another powerful database option for vector store so they can more easily build AI applications.”

Supporting Quotes 

“We are thrilled to see Couchbase add vector capabilities, and the timing couldn’t be better as we’re implementing AI and LLMs to better meet the needs of consumers,” said Emre Savci, tech lead and staff engineer at Trendyol. “Since working with Couchbase, our developers have become more agile in building and scaling applications to provide the best possible shopping experiences for our customers. The addition of vector search will help our team make the user experience even better and provide more accurate and personalized search results to our shoppers.”

“The next generation of apps will be incredibly advanced as organizations put AI in the driver’s seat of their innovation,” said Doug Henschen, vice president and principal analyst at Constellation Research. “With AI requiring new tools and infrastructure to support it, organizations are increasingly looking at ways to consolidate and simplify technology stacks and manage cost. With the addition of vector search capabilities, Couchbase is reducing complexity and delivering a multipurpose database platform that addresses needs from cloud to edge to on-premises. This will let organizations do more on one, unified platform to accelerate the development of adaptive applications.”

These new capabilities are expected to be available in the first quarter of Couchbase’s fiscal year 2025 in Capella and Couchbase Server and in beta for mobile and edge. 

Additional Resources

  • For more information about these and other new features in Couchbase Capella and Server, click here
  • Sign up here for the beta of Couchbase Mobile with vector search.
  • To learn more about Couchbase for vector search, click here
  • Register here to attend a webcast to learn more about the new features and capabilities for AI-powered adaptive applications. 
Couchbase Capella Wins Best Cloud Data Management Solution at the 2023-2024 Cloud Awards

Couchbase Capella Wins Best Cloud Data Management Solution at the 2023-2024 Cloud Awards

Judges Praise Database-as-a-Service for Its Performance, Versatility and Community

SANTA CLARA, Calif. – Jan. 11, 2024 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced that Couchbase Capella™ Database-as-a-Service (DBaaS) has been declared Best Cloud Data Management Solution at the 2023-2024 Cloud Awards

The Cloud Awards has recognized and honored innovation in cloud computing since 2011, spanning diverse industry sectors and welcoming submissions from organizations across the globe. Hundreds of organizations entered the 2023-2024 Cloud Awards program, with international entries coming from North America, Canada, Australia, the United Kingdom, Europe and the Middle East. 

“A modern database that allows developers to harness the power of AI to create real-time, adaptive applications that are contextual, hyper-personalized and intelligent, is an increasingly essential asset for enterprises,” said Scott Anderson, SVP, Product Management and Business Operations, Couchbase. “We are honored that our cloud database platform Capella has been named Best Cloud Data Management Solution by the Cloud Awards. We believe that the future of databases lies in the cloud, allowing organizations to take advantage of the scalability and agility they need from the cloud to the edge, and this recognition is a wonderful validation of our approach.” 

“With its capability for low-latency data access, Couchbase proves well-suited for applications with demanding performance requirements,” said Jebastin Packiaraj, Lead Judge, The Cloud Awards. “Developers appreciate its flexibility, allowing powerful queries, including joins and aggregations. The active and engaged community is valuable for users seeking support, sharing experiences and accessing a wealth of resources. Supporting multiple data models, including JSON documents and key-value, adds to Couchbase’s versatility. The Judging Team at the Cloud Awards were very impressed – congratulations, Couchbase!”

“The Cloud Awards continue to lead the way in identifying the great organizations who create world-changing technologies,” said James Williams, Head of Operations, The Cloud Awards. “Couchbase is a truly impressive winner of a Cloud Award, taking cloud technologies to new heights. They impressed the panel with their market-leading innovations, and it was a real pleasure to see them come top in their category.”

To view the full list of Cloud Award winners, please visit: https://www.cloud-awards.com/2023-2024-cloud-awards-finalists/

Additional resources:

Couchbase to Present at Upcoming Investor Conference

SANTA CLARA, Calif., Jan. 4, 2024 Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced that Chief Financial Officer Greg Henry will present at the 26th Annual Needham Growth Conference in New York, New York. The presentation will take place on Wednesday, January 17, 2024 at 9:45 a.m. PT / 12:45 p.m. ET. Couchbase management will also participate in investor meetings. A live webcast and replay will be available on the Company’s investor relations website.

Couchbase Announces Third Quarter Fiscal 2024 Financial Results

Couchbase Announces Third Quarter Fiscal 2024 Financial Results

Santa Clara, Calif., – December 6, 2023Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced financial results for its third quarter ended October 31, 2023.

“We again delivered top line and profitability outcomes that exceeded the high end of our guidance range, highlighted by 24% ARR growth, healthy new business and expansion activity and robust consumption trends with Capella,” said Matt Cain, Chair, President and CEO of Couchbase. “I’m pleased with the team’s excellent operational performance which is contributing to our increasing momentum across the company. We look forward to sharing more at our inaugural Financial Analyst Day next Wednesday in New York City.”

Third Quarter Fiscal 2024 Financial Highlights

  • Revenue: Total revenue for the quarter was $45.8 million, an increase of 19% year-over-year. Subscription revenue for the quarter was $44.0 million, an increase of 23% year-over-year.
  • Annual recurring revenue (ARR): Total ARR as of October 31, 2023 was $188.7 million, an increase of 24% year-over-year, or 23% on a constant currency basis. See the section titled “Key Business Metrics” below for details.
  • Gross margin: Gross margin for the quarter was 88.8%, compared to 87.4% for the third quarter of fiscal 2023. Non-GAAP gross margin for the quarter was 89.5%, compared to 88.0% for the third quarter of fiscal 2023. See the section titled “Use of Non-GAAP Financial Measures” and the tables titled “Reconciliation of GAAP to Non-GAAP Results” below for details.
  • Loss from operations: Loss from operations for the quarter was $17.5 million, compared to $16.6 million for the third quarter of fiscal 2023. Non-GAAP operating loss for the quarter was $5.0 million, compared to $9.6 million for the third quarter of fiscal 2023.
  • Cash flow: Cash flow used in operating activities for the quarter was $12.7 million, compared to $14.7 million in the third quarter of fiscal 2023. Capital expenditures were $1.1 million during the quarter, leading to negative free cash flow of $13.8 million, compared to negative free cash flow of $16.3 million in the third quarter of fiscal 2023.
  • Remaining performance obligations (RPO): RPO as of October 31, 2023 was $164.4 million, an increase of 3% year-over-year.

Recent Business Highlights

  • Announced a new Capella columnar service on Amazon Web Services (AWS) that enables organizations to harness real-time analytics to build adaptive applications. The new service introduces a columnar store and data integration into the Couchbase Capella Database-as-a-Service (DBaaS), thereby allowing for real-time data analysis on the same platform as operational workloads. By converging operational and real-time analytic applications into one database platform, Couchbase removes friction to deliver a premium customer experience.
  • Recognized on the Highest-Rated Cloud-Computing Companies To Work For list for 2023 released by Battery Ventures created with data provided by Glassdoor. The distinction placed Couchbase at number nine out of 25 public companies.
  • Will hold its inaugural Financial Analyst Day on Wednesday, December 13, 2023 from 9:00am-12:00pm Eastern Time, and will share an overview of the company’s strategic initiatives, market opportunities, innovation and financial outlook. The event will also feature a customer panel and a Q&A session with the management team. Financial Analyst Day will be webcast live and the replay will be accessible on the investor relations page of Couchbase’s website at investors.couchbase.com. Institutional Investors and Financial Analysts may register for the in-person event by emailing analystday@couchbase.com.

Financial Outlook

For the fourth quarter and full year of fiscal 2024, Couchbase expects:

Q4 FY2024 Outlook FY2024 Outlook
Total Revenue $46.2-46.8 million $176.2-176.8 million
Total ARR $198.0-202.0 million $198.0-202.0 million
Non-GAAP Operating Loss $8.2-7.4 million $35.4-34.6 million

The guidance provided above is based on several assumptions that are subject to change and many of which are outside our control. If actual results vary from these assumptions, our expectations may change. There can be no assurance that we will achieve these results.

Couchbase is not able, at this time, to provide GAAP targets for operating loss for the fourth quarter or full year of fiscal 2024 because of the difficulty of estimating certain items excluded from non-GAAP operating loss that cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant.

Conference Call Information

Couchbase will host a live webcast at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Wednesday, December 6, 2023, to discuss its financial results and business highlights. The conference call can be accessed by dialing 877-407-8029 from the United States, or +1 201-689-8029 from international locations. The live webcast and a webcast replay can be accessed from the investor relations page of Couchbase’s website at investors.couchbase.com.

About Couchbase

Modern customer experiences need a flexible database platform that can power applications spanning from cloud to edge and everything in between. Couchbase’s mission is to simplify how developers and architects develop, deploy and run modern applications wherever they are. We have reimagined the database with our fast, flexible and affordable cloud database platform Couchbase Capella, allowing organizations to quickly build applications that deliver premium experiences to their customers – all with best-in-class price performance. More than 30% of the Fortune 100 trust Couchbase to power their modern applications. For more information, visit www.couchbase.com and follow us on X (formerly Twitter) @couchbase.

Couchbase has used, and intends to continue using, its investor relations website and the corporate blog at blog.couchbase.com to disclose material non-public information and to comply with its disclosure obligations under Regulation FD. Accordingly, you should monitor our investor relations website and the corporate blog in addition to following our press releases, SEC filings and public conference calls and webcasts.

Use of Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, we believe certain non-GAAP financial measures are useful to investors in evaluating our operating performance. We use certain non-GAAP financial measures, collectively, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, may be helpful to investors because they provide consistency and comparability with past financial performance and meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook. Non-GAAP financial measures are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP, and may be different from similarly-titled non-GAAP financial measures used by other companies. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures (provided in the financial statement tables included in this press release), and not to rely on any single financial measure to evaluate our business.

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss and non-GAAP net loss per share: We define these non-GAAP financial measures as their respective GAAP measures, excluding expenses related to stock-based compensation expense, employer payroll taxes on employee stock transactions and restructuring charges. We use these non-GAAP financial measures in conjunction with GAAP measures to assess our performance, including in the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance.

Free cash flow: We define free cash flow as cash used in operating activities less additions to property and equipment, which includes capitalized internal-use software costs. We believe free cash flow is a useful indicator of liquidity that provides our management, board of directors and investors with information about our future ability to generate or use cash to enhance the strength of our balance sheet and further invest in our business and pursue potential strategic initiatives.

Please see the reconciliation tables at the end of this press release for the reconciliation of GAAP and non-GAAP results.

 

Key Business Metrics

We review a number of operating and financial metrics, including ARR, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions.

We define ARR as of a given date as the annualized recurring revenue that we would contractually receive from our customers in the month ending 12 months following such date. Based on historical experience with customers, we assume all contracts will be automatically renewed at the same levels unless we receive notification of non-renewal and are no longer in negotiations prior to the measurement date. ARR also includes revenue from consumption-based cloud credits of Couchbase Capella products. ARR for Couchbase Capella products in a customer’s initial year is calculated as described above; after a customer’s initial year it is calculated by annualizing the prior 90 days of actual consumption, assuming no increases or reductions in usage. ARR excludes revenue derived from the use of cloud products only based on on-demand arrangements and services revenue. ARR should be viewed independently of revenue, and does not represent our revenue under GAAP on an annualized basis, as it is an operating metric that can be impacted by contract start and end dates and renewal dates. ARR is not intended to be a replacement for forecasts of revenue. Although we seek to increase ARR as part of our strategy of targeting large enterprise customers, this metric may fluctuate from period to period based on our ability to acquire new customers and expand within our existing customers. We believe that our ARR is an important indicator of the growth and performance of our business.

We also attempt to represent the changes in the underlying business operations by eliminating fluctuations caused by changes in foreign currency exchange rates within the current period. We calculate constant currency growth rates by applying the applicable prior period exchange rates to current period results.

 

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include, but are not limited to, quotations of management, the section titled “Financial Outlook” above and statements about Couchbase’s market position, strategies and potential market opportunities. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “continue,” “could,” “potential,” “remain,” “may,” “might,” “will,” “would” or similar expressions and the negatives of those terms. However, not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including factors beyond our control, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to: our history of net losses and ability to achieve or maintain profitability in the future; our ability to continue to grow on pace with historical rates; our ability to manage our growth effectively; intense competition and our ability to compete effectively; cost-effectively acquiring new customers or obtaining renewals, upgrades or expansions from our existing customers; the market for our products and services being relatively new and evolving, and our future success depending on the growth and expansion of this market; our ability to innovate in response to changing customer needs, new technologies or other market requirements, including new capabilities, programs and partnerships and their impact on our customers and our business; our limited operating history, which makes it difficult to predict our future results of operations; the significant fluctuation of our future results of operations and ability to meet the expectations of analysts or investors; our significant reliance on revenue from subscriptions, which may decline and, the recognition of a significant portion of revenue from subscriptions over the term of the relevant subscription period, which means downturns or upturns in sales are not immediately reflected in full in our results of operations; and the impact of geopolitical and macroeconomic factors. Further information on risks that could cause actual results to differ materially from forecasted results are included in our filings with the Securities and Exchange Commission that we may file from time to time, including those more fully described in our Annual Report on Form 10-K for the fiscal year ended January 31, 2023. Additional information will be made available in our Quarterly Report on Form 10-Q for the quarter ended October 31, 2023 that will be filed with the Securities and Exchange Commission, which should be read in conjunction with this press release and the financial results included herein. Any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Investor Contact:

Edward Parker
ICR for Couchbase
IR@couchbase.com

Media Contact:

Michelle Lazzar
Couchbase Communications
CouchbasePR@couchbase.com

Couchbase, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Revenue:
License $4,577 $3,519 $14,318 $14,908
Support and other 39,420 32,201 109,175 89,852
Total subscription revenue 43,997 35,720 123,493 104,760
Services 1,816 2,837 6,455 8,441
Total revenue 45,813 38,557 129,948 113,201
Cost of revenue:
Subscription(1) 3,549 2,631 11,067 7,548
Services(1) 1,562 2,244 5,875 6,759
Total cost of revenue 5,111 4,875 16,942 14,307
Gross profit 40,702 33,682 113,006 98,894
Operating expenses:
Research and development(1) 15,903 13,998 47,578 42,760
Sales and marketing(1) 31,602 27,448 96,503 81,764
General and administrative(1) 10,739 8,828 30,823 25,183
Restructuring(1) 46
Total operating expenses 58,244 50,274 174,950 149,707
Loss from operations (17,542) (16,592) (61,944) (50,813)
Interest expense (26) (43) (76)
Other income (expense), net 1,298 317 3,986 22
Loss before income taxes (16,244) (16,301) (58,001) (50,867)
Provision for income taxes 11 376 780 1,013
Net loss $(16,255) $(16,677) $(58,781) $(51,880)
Net loss per share, basic and diluted $(0.34) $(0.37) $(1.26) $(1.16)
Weighted-average shares used in computing net loss per share, basic and diluted 47,586 44,932 46,724 44,619

_______________________________

  1. (1) Includes stock-based compensation expense as follows:
Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Cost of revenue—subscription $130 $128 $559 $391
Cost of revenue—services 119 106 413 317
Research and development 3,116 1,905 9,498 5,891
Sales and marketing 4,188 2,413 11,461 6,863
General and administrative 4,202 2,201 11,216 5,468
Restructuring 1
Total stock-based compensation expense $11,755 $6,753 $33,148 $18,930

 

Couchbase, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
As of October 31, 2023 As of January 31, 2023
Assets
Current assets
Cash and cash equivalents $46,907 $40,446
Short-term investments 109,719 127,856
Accounts receivable, net 30,494 39,847
Deferred commissions 12,874 13,096
Prepaid expenses and other current assets 7,450 8,234
Total current assets 207,444 229,479
Property and equipment, net 9,630 7,430
Operating lease right-of-use assets 5,259 6,940
Deferred commissions, noncurrent 7,896 7,524
Other assets 1,760 1,666
Total assets $231,989 $253,039
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $3,172 $1,407
Accrued compensation and benefits 9,124 12,641
Other accrued expenses 3,399 6,076
Operating lease liabilities 2,980 3,117
Deferred revenue 71,529 71,716
Total current liabilities 90,204 94,957
Operating lease liabilities, noncurrent 2,742 4,543
Deferred revenue, noncurrent 3,775 3,275
Total liabilities 96,721 102,775
Stockholders’ equity
Preferred stock
Common stock
Additional paid-in capital 604,637 561,547
Accumulated other comprehensive loss (112) (807)
Accumulated deficit (469,257) (410,476)
Total stockholders’ equity 135,268 150,264
Total liabilities and stockholders’ equity $231,989 $253,039

 

Couchbase, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Cash flows from operating activities
Net loss (16,255) $(16,677) $(58,781) $(51,880)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization 399 838 2,034 2,304
Stock-based compensation, net of amounts capitalized 11,755 6,753 33,148 18,930
Amortization of deferred commissions 4,500 4,139 13,742 12,549
Non-cash lease expense 765 752 2,313 2,152
Foreign currency transaction losses 484 262 649 1,298
Other (804) (124) (2,580) 177
Changes in operating assets and liabilities
Accounts receivable 1,577 6,075 9,114 13,404
Deferred commissions (4,746) (4,563) (13,892) (12,269)
Prepaid expenses and other assets 955 1,905 837 691
Accounts payable (10) (2,067) 1,735 1,476
Accrued compensation and benefits (1,763) (1,468) (3,517) (7,076)
Other accrued expenses (1,126) (735) (2,997) 300
Operating lease liabilities (838) (819) (2,561) (1,930)
Deferred revenue (7,636) (8,991) 313 (11,108)
Net cash used in operating activities (12,743) (14,720) (20,443) (30,982)
Cash flows from investing activities
Purchases of short-term investments (26,141) (41,169) (90,456) (110,637)
Maturities of short-term investments 41,854 48,341 111,974 81,143
Additions to property and equipment (1,066) (1,617) (3,425) (4,093)
Net cash provided by (used in) investing activities 14,647 5,555 18,093 (33,587)
Cash flows from financing activities
Proceeds from exercise of stock options 2,703 666 7,353 4,033
Proceeds from issuance of common stock under ESPP 1,153 959 2,000 4,484
Net cash provided by financing activities 3,856 1,625 9,353 8,517
Effect of exchange rate changes on cash, cash equivalents and restricted cash (290) (17) (542) (855)
Net increase (decrease) in cash, cash equivalents and restricted cash 5,470 (7,557) 6,461 (56,907)
Cash, cash equivalents, and restricted cash at beginning of period 41,980 46,881 40,989 96,231
Cash, cash equivalents, and restricted cash at end of period $47,450 $39,324 $47,450 $39,324
Reconciliation of cash, cash equivalents, and restricted cash within the consolidated balance sheets to the amounts shown above:
Cash and cash equivalents $46,907 $38,781 $46,907 $38,781
Restricted cash included in other assets 543 543 543 543
Total cash, cash equivalents and restricted cash $47,450 $39,324 $47,450 $39,324

 

Couchbase, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share data)
(unaudited)
Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Reconciliation of GAAP gross profit to non-GAAP gross profit:
Total revenue $45,813 $38,557 $129,948 $113,201
Gross profit $40,702 $33,682 $113,006 $98,894
Add: Stock-based compensation expense 249 234 972 708
Add: Employer taxes on employee stock transactions 55 12 86 36
Non-GAAP gross profit $41,006 $33,928 $114,064 $99,638
Gross margin 88.8 % 87.4 % 87.0 % 87.4 %
Non-GAAP gross margin 89.5 % 88.0 % 87.8 % 88.0 %

 

Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Reconciliation of GAAP operating expenses to non-GAAP operating expenses:
GAAP research and development $15,903 $13,998 $47,578 $42,760
Less: Stock-based compensation expense (3,116) (1,905) (9,498) (5,891)
Less: Employer taxes on employee stock transactions (199) (69) (430) (138)
Non-GAAP research and development $12,588 $12,024 $37,650 $36,731
GAAP sales and marketing $31,602 $27,448 $96,503 $81,764
Less: Stock-based compensation expense (4,188) (2,413) (11,461) (6,863)
Less: Employer taxes on employee stock transactions (327) (115) (777) (218)
Non-GAAP sales and marketing $27,087 $24,920 $84,265 $74,683
GAAP general and administrative $10,739 $8,828 $30,823 $25,183
Less: Stock-based compensation expense (4,202) (2,201) (11,216) (5,468)
Less: Employer taxes on employee stock transactions (176) (14) (264) (98)
Non-GAAP general and administrative $6,361 $6,613 $19,343 $19,617
GAAP restructuring expense $— $— $46 $—
Less: Restructuring(2) (46)
Non-GAAP restructuring $— $— $— $—

 

Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Reconciliation of GAAP operating loss to non-GAAP operating loss:
Total revenue $45,813 $38,557 $129,948 $113,201
Loss from operations $(17,542) $(16,592) $(61,944) $(50,813)
Add: Stock-based compensation expense 11,755 6,753 33,147 18,930
Add: Employer taxes on employee stock transactions 757 210 1,557 490
Add: Restructuring(2) 46
Non-GAAP operating loss $(5,030) $(9,629) $(27,194) $(31,393)
Operating margin (38) % (43) % (48) % (45) %
Non-GAAP operating margin (11) % (25) % (21) % (28) %

 

Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Reconciliation of GAAP net loss to non-GAAP net loss:
Net loss $(16,255) $(16,677) $(58,781) $(51,880)
Add: Stock-based compensation expense 11,755 6,753 33,147 18,930
Add: Employer taxes on employee stock transactions 757 210 1,557 490
Add: Restructuring(2) 46
Non-GAAP net loss $(3,743) $(9,714) $(24,031) $(32,460)
GAAP net loss per share $(0.34) $(0.37) $(1.26) $(1.16)
Non-GAAP net loss per share $(0.08) $(0.22) $(0.51) $(0.73)
Weighted average shares outstanding, basic and diluted 47,586 44,932 46,724 44,619

_______________________________

      (2) For the nine months ended October 31, 2023, an immaterial amount of stock-based compensation expense related to restructuring charges was included in the restructuring expense line.

The following table presents a reconciliation of free cash flow to net cash used in operating activities, the most directly comparable GAAP measure, for each of the periods indicated (in thousands, unaudited):

Three Months Ended October 31, Nine Months Ended October 31,
2023 2022 2023 2022
Net cash used in operating activities $(12,743) $(14,720) $(20,443) $(30,982)
Less: Additions to property and equipment (1,066) (1,617) (3,425) (4,093)
Free cash flow $(13,809) $(16,337) $(23,868) $(35,075)
Net cash provided by (used in) investing activities $14,647 $5,555 $18,093 $(33,587)
Net cash provided by financing activities $3,856 $1,625 $9,353 $8,517

 

Couchbase, Inc.
Key Business Metrics
(in millions)
(unaudited)
As of
Jan. 31, April 30, July 31, Oct. 31, Jan. 31, April 30, July 31, Oct. 31,
2022 2022 2022 2022 2023 2023 2023 2023
Annual Recurring Revenue $132.9 $139.7 $145.2 $151.7 $163.7 $172.2 $180.7 $188.7

 

 

Couchbase Announces New Capella Columnar Service To Enable Real-Time Analytics for Adaptive Applications

Couchbase Announces New Capella Columnar Service To Enable Real-Time Analytics for Adaptive Applications

Capella Columnar Service on AWS Can Eliminate the Latency Gap Between Analytics and Operations 

LAS VEGAS – Nov. 27, 2023 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced a new Capella columnar service on Amazon Web Services (AWS) at AWS re:Invent 2023, enabling organizations to harness real-time analytics to build adaptive applications. Capella columnar is a new service that introduces a columnar store and data integration into the Capella Database-as-a-Service (DBaaS), thereby allowing for real-time data analysis on the same platform as operational workloads. By converging operational and real-time analytic applications into one database platform, Couchbase removes friction to deliver a premium customer experience. For more information about Capella columnar and to sign up for the private preview, please visit https://www.couchbase.com/products/analytics/

“To gain a competitive advantage and accelerate business opportunities, organizations are investing in real-time, adaptive applications that are contextual, hyper-personalized and intelligent. Real-time analytics are paramount to delivering these adaptive applications, and AI is making them even better and more strategic,” said Scott Anderson, SVP of product management and business operations at Couchbase. “With columnar in our Capella DBaaS, for the first time organizations can easily build adaptive applications powered by real-time analytics in a single JSON-based platform. We are eliminating the latency gap that has forever existed between analytics and operational databases while making it easier for development teams to include the required real-time analytic measures into their adaptive applications.” 

According to Forrester Research1, “Moving data from transactional systems to operational systems and then to analytical systems is a barrier to making better decisions faster. Disparate data stacks also compromise the delivery of timely data to various applications, operational systems and into the analytics workflow, resulting in missed business opportunities.” The acceleration of AI creates an even greater challenge because having disparate database platforms introduces complexity that confuses the models being trained to power the application. Capella columnar solves these problems as it allows users to perform operational and real-time analytical processing with compelling performance and speed, all in one uniquely architected platform. Furthermore, both the application and the user benefit by experiencing no latency and receiving a more seamless, premium experience. 

With the new Capella columnar service, customers can:

  • Improve agility and performance. Capella columnar works within a Capella-powered application to enable fast, schemaless ingestion without having to perform extract, transform and load (ETL). The service can distribute data from operational workloads to perform real-time analytics on operational data and then immediately influence application behavior with that information. In addition, the separation of compute and storage means Capella columnar can rapidly scale to meet changing application or analytical needs.
  • Stream ingestion from enterprise data sources in real time. With Capella columnar, operational analytics are not limited to only operational data because users can include external JSON, relational, streaming and other datasets from SaaS applications or other database management sources. Capella columnar can analyze a true variety of data in a simple, single statement. For example, it can analyze data from Couchbase, S3, BSON, Cassandra, DynamoDB and MySQL all in the same statement. 
  • Increase ease of use for developers. Capella columnar uses the same SQL++ query language across operational and real-time analytic applications. This means that developers who already know SQL can easily build applications on a single platform with a single query language instead of having to use two different query languages. The new service also features natural language-powered Capella iQ as a SQL++ co-pilot for faster coding. 
  • Reduce complexity and cost. By converging operational and real-time analytics in one data platform, customers can achieve more with Capella and with a lower total cost of ownership (TCO) instead of absorbing the cost of one database platform for operational workloads and another for near-real-time analytics. In addition, teams converting JSON data to traditional analytic databases will no longer need to go through a complex conversion process. 

Capella columnar leverages AWS services as an integral part of the product architecture including Amazon Elastic Compute Cloud (Amazon EC2), Amazon Simple Storage Service (Amazon S3), Amazon Elastic Kubernetes Service (Amazon EKS), Amazon Managed Streaming for Apache Kafka (Amazon MSK) and AWS Secrets Manager. 

Couchbase is attending AWS re:Invent in Las Vegas, November 27-December 1, 2023. Attendees can visit booth number 1095 to see a demo of Capella columnar and learn more about Capella for building adaptive applications.

Additional Resources

(1) Translytical Architecture 2.0 Evolves To Support Distributed, Multimodel, And AI Capabilities, by Noel Yuhanna, November 2023, Forrester Research

Couchbase Named to 2023 List of the Highest-Rated Cloud Computing Companies To Work For

Couchbase Named to 2023 List of the Highest-Rated Cloud Computing Companies To Work For

Battery Ventures Recognizes Couchbase Among Public Cloud Companies With Highest Levels of Self-Reported Employee Satisfaction

SANTA CLARA, Calif. – Oct. 5, 2023 Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced its recognition as one of the highest-rated cloud computing companies to work for, in the sixth-ever list released by Battery Ventures, the global, technology-focused investment firm, created with data provided by Glassdoor.* The distinction placed Couchbase at number nine out of 25 companies with an overall company ranking of 4.45, compared to the broader average ranking across Glassdoor of 3.7. 

The list recognizes the top 25 public and top 25 private companies — all business-to-business (B2B), cloud-computing companies — where employees self-report the highest levels of satisfaction at work, according to feedback shared on Glassdoor, a provider of insights about jobs and companies.

“Couchbase is a values-driven organization that strives to make tomorrow better than today for customers, partners and each other. Our values also include being a great human with integrity, attacking hard problems and playing to win together while also serving our families,” said Fidelma Butler, chief people officer at Couchbase. “Couchbase’s mission is to simplify how organizations develop, deploy and run modern applications wherever they are, and it is our world-class team who enable that. We are honored to be named one of the highest-rated cloud computing companies to work for and deeply appreciate the many contributions by our dedicated team who make Couchbase a terrific place to work.” 

Couchbase is committed to building and supporting an engaged, diverse and inclusive global team. Additional recent workplace awards Couchbase has been honored with include UK’s Best Workplaces in Tech 2022 and Fortune’s Best Workplaces in the Bay Area 2022. For more information about career opportunities at Couchbase, please visit https://www.couchbase.com/careers.  

“The companies on this year’s Highest-Rated Cloud-Computing Companies To Work For list have managed to create and preserve stellar corporate cultures during a very tumultuous time in the technology markets — and also as traditional workplace norms, like working in the office, have dramatically shifted post-COVID,” said Neeraj Agrawal, a cloud-computing investor and Battery general partner. “Cultivating employee happiness and satisfaction is more challenging than ever, so we commend this year’s winners for their efforts.”

“Company culture is pivotal for attracting elite talent and sustaining a competitive edge in the marketplace, and its significance becomes even more pronounced in challenging economic times. We hope that all companies featured on this list will take pride in this well-deserved recognition,” added Brandon Gleklen, a Battery principal.

To qualify for the 2023 list, a cloud company must have received at least 30 company reviews on Glassdoor between July 1, 2022 and June 30, 2023. The public company report tracks public cloud companies with a B2B business model that are listed on a U.S.-based stock exchange and have at least $500 million in total enterprise value as of the end of Q2 2023, according to CapIQ.

The full private and public company lists can be found here: https://www.battery.com/blog/highest-rated-cloud-companies-2023 

*Glassdoor was a Battery portfolio company. For a full list of all Battery investments and exits, please click here.

Centrica Powers Crucial Engineering Services for Millions of Customers With Couchbase Capella

Centrica Powers Crucial Engineering Services for Millions of Customers With Couchbase Capella

SANTA CLARA, Calif. – Sept. 25, 2023 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced that Centrica PLC, an international energy services and solutions provider, has selected Couchbase Capella™ Database-as-a-Service (DBaaS). Centrica will use Capella to provide customer and job history information to its circa 7,000 field engineers, allowing them to quickly and effectively serve more than 10 million customers in the U.K. and Ireland. By adopting Capella, Centrica benefits from a fully managed cloud database service with premium performance while improving ROI.

“The needs of our customers have driven our ongoing cloud-first policy, and Couchbase Capella aligns perfectly with this strategy – delivering a scalable, powerful database solution at compelling price-performance,” commented Titu Joseph Rajan, head of integration at Centrica. “We must ensure that urgent customer service can be carried out seamlessly by our highly skilled engineers. By migrating from our self-managed on-premises instances of Couchbase Enterprise servers to the Couchbase Capella managed service, we have been able to reduce our reliance on infrastructure, thereby cutting down our infrastructure maintenance and operational costs.”

“At the same time, migrating to Capella has enabled the modernisation of our legacy application stack,” continued Rajan. “With the support of Couchbase’s Solution Engineering and Professional Services teams, we have been able to further optimise our workflows and reduce our cluster sizes by appropriate indexing and tuning of our NoSQL queries which resulted in even better performance.”

Centrica provides energy and services to over 10 million customers, through brands such as British Gas, Bord Gáis Energy and Hive. Due to the nature of their services, users expect rapid, accurate customer service to solve urgent issues such as broken boilers or disrupted energy supplies.

Couchbase Capella is a fully managed DBaaS, that combines reliability and scalability with compelling price-performance to reduce the total cost of ownership for the organization. Centrica is using Capella on Amazon Web Services (AWS) for its customer 360 application which stores and provides access to customer data including products and billing history through a field app used by the engineers. With efficient, reliable and secure access to this data, Centrica’s applications can quickly highlight and share the key details that engineers need to fix customers’ issues.

“Modern customer service demands near-instant action: meaning the databases powering applications have to be reliable, scalable and offer a complete view of the customer,” said Robert Ekstrom, vice president and general manager of Europe at Couchbase. “Centrica’s decision will mean it can more effectively coordinate its engineers to deliver services, ensuring customer satisfaction. As enterprises look for ways to deliver more personalized customer service than their competition, and make greater use of data-intensive technologies such as AI, modern cloud-based databases will be an essential part of the technology stack – coupling agility, scalability and the best possible price-performance.”

See how fast and easy it is to get started with Capella by starting a free trial.

Additional Resources

  • Read more about how energy and utilities customers are modernizing with Couchbase here.
  • For more information about Capella for developers, please visit this page.
  • See how Capella compares to the competition here.
Couchbase Announces Second Quarter Fiscal 2024 Financial Results

Couchbase Announces Second Quarter Fiscal 2024 Financial Results

Santa Clara, Calif., – September 6, 2023Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced financial results for its second quarter ended July 31, 2023. “We delivered revenue and profitability that exceeded the high end of our guidance range, highlighted by 24% ARR growth, strong retention, and increasing momentum with Capella,” said Matt Cain, Chair, President and CEO of Couchbase. “As we look to the second half of the fiscal year, we are poised to continue to make strong progress on our strategic initiatives, including investing in our cloud database platform for what we believe will be a very exciting future underpinned by AI-powered applications.”

Second Quarter Fiscal 2024 Financial Highlights

  • Revenue: Total revenue for the quarter was $43.1 million, an increase of 8% year-over-year. Subscription revenue for the quarter was $41.0 million, an increase of 11% year-over-year.
  • Annual recurring revenue (ARR): Total ARR as of July 31, 2023 was $180.7 million, an increase of 24% year-over-year, or 23% on a constant currency basis. See the section titled “Key Business Metrics” below for details.
  • Gross margin: Gross margin for the quarter was 86.3%, compared to 88.0% for the second quarter of fiscal 2023. Non-GAAP gross margin for the quarter was 87.2%, compared to 88.7% for the second quarter of fiscal 2023. See the section titled “Use of Non-GAAP Financial Measures” and the tables titled “Reconciliation of GAAP to Non-GAAP Results” below for details.
  • Loss from operations: Loss from operations for the quarter was $21.9 million, compared to $15.2 million for the second quarter of fiscal 2023. Non-GAAP operating loss for the quarter was $9.2 million, compared to $8.4 million for the second quarter of fiscal 2023.
  • Cash flow: Cash flow used in operating activities for the quarter was $0.5 million, compared to $7.7 million in the second quarter of fiscal 2023. Capital expenditures were $1.1 million during the quarter, leading to negative free cash flow of $1.6 million, compared to negative free cash flow of $9.3 million in the second quarter of fiscal 2023.
  • Remaining performance obligations (RPO): RPO as of July 31, 2023 was $170.6 million, an increase of 2% year-over-year.

Recent Business Highlights

  • Announced that Couchbase is introducing generative AI into its Database-as-a-Service Couchbase Capella designed to significantly enhance developer productivity and accelerate time to market for modern applications. This new capability, called Capella iQ, is designed to enable developers to write SQL++ and application-level code more quickly by delivering recommended sample code.
  • Announced the Couchbase AI Accelerate Partner Program designed to make it easier for customers to build AI-powered applications with Couchbase Capella and support integrations with the broader AI and data ecosystem. The goal of the program is to provide organizations with resources to quickly integrate their platforms and tools with Couchbase Capella, thereby reducing friction for customers who are building and deploying models for AI-driven applications.
  • Granted two additional U.S. patents, demonstrating the company’s continued high velocity of product innovation and differentiation. One is Couchbase’s fourth patent, which was granted for executing transactions on distributed databases. The other is Couchbase’s fifth patent, which was for cost-based query optimization for array fields in database systems.
  • Announced additional enhancements to Couchbase Capella that further improve the developer experience, increase efficiency and make it easier to operate a cloud database platform. This includes new integrations with popular developer tools Vercel and the IntelliJ family of integrated development environments (IDEs), dynamic disk input/output operations per second (IOPS), on/off provisioned database capability to better align with developer usage patterns and the achievement of independent validation for Payment Card Industry Data Security Standard (PCI DSS) and Cloud Security Alliance Security Trust Assurance and Risk (CSA STAR) compliance.

Financial Outlook

For the third quarter and full year of fiscal 2024, Couchbase expects:

Q3 FY2024 Outlook FY2024 Outlook
Total Revenue $42.7-43.3 million $171.7-174.7 million
Total ARR $185.0-188.0 million $195.5-199.5 million
Non-GAAP Operating Loss $9.9-9.1 million $42.5-38.5 million



The guidance provided above is based on several assumptions that are subject to change and many of which are outside our control. If actual results vary from these assumptions, our expectations may change. There can be no assurance that we will achieve these results.

Couchbase is not able, at this time, to provide GAAP targets for operating loss for the third quarter or full year of fiscal 2024 because of the difficulty of estimating certain items excluded from non-GAAP operating loss that cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant.

Conference Call Information

Couchbase will host a live webcast at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on Wednesday, September 6, 2023, to discuss its financial results and business highlights. The conference call can be accessed by dialing 877-407-8029 from the United States, or +1 201-689-8029 from international locations. The live webcast and a webcast replay can be accessed from the investor relations page of Couchbase’s website at investors.couchbase.com.

Use of Non-GAAP Financial Measures

In addition to our financial information presented in accordance with GAAP, we believe certain non-GAAP financial measures are useful to investors in evaluating our operating performance. We use certain non-GAAP financial measures, collectively, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, may be helpful to investors because they provide consistency and comparability with past financial performance and meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook. Non-GAAP financial measures are presented for supplemental informational purposes only, have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP, and may be different from similarly-titled non-GAAP financial measures used by other companies. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures (provided in the financial statement tables included in this press release), and not to rely on any single financial measure to evaluate our business.

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss and non-GAAP net loss per share:

We define these non-GAAP financial measures as their respective GAAP measures, excluding expenses related to stock-based compensation expense, employer payroll taxes on employee stock transactions and restructuring charges. We use these non-GAAP financial measures in conjunction with GAAP measures to assess our performance, including in the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance.

Free cash flow:

We define free cash flow as cash used in operating activities less additions to property and equipment, which includes capitalized internal-use software costs. We believe free cash flow is a useful indicator of liquidity that provides our management, board of directors and investors with information about our future ability to generate or use cash to enhance the strength of our balance sheet and further invest in our business and pursue potential strategic initiatives. Please see the reconciliation tables at the end of this press release for the reconciliation of GAAP and non-GAAP results.

Key Business Metrics

We review a number of operating and financial metrics, including ARR, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. We define ARR as of a given date as the annualized recurring revenue that we would contractually receive from our customers in the month ending 12 months following such date. Based on historical experience with customers, we assume all contracts will be automatically renewed at the same levels unless we receive notification of non-renewal and are no longer in negotiations prior to the measurement date. ARR also includes revenue from consumption-based cloud credits of Couchbase Capella products. ARR for Couchbase Capella products in a customer’s initial year is calculated as described above; after a customer’s initial year it is calculated by annualizing the prior 90 days of actual consumption, assuming no increases or reductions in usage. ARR excludes revenue derived from the use of cloud products only based on on-demand arrangements and services revenue. ARR should be viewed independently of revenue, and does not represent our revenue under GAAP on an annualized basis, as it is an operating metric that can be impacted by contract start and end dates and renewal dates. ARR is not intended to be a replacement for forecasts of revenue. Although we seek to increase ARR as part of our strategy of targeting large enterprise customers, this metric may fluctuate from period to period based on our ability to acquire new customers and expand within our existing customers. We believe that our ARR is an important indicator of the growth and performance of our business. We updated our definition of ARR in the third quarter of fiscal 2023 to clarify that the 90-day actual consumption methodology is only used after a customer’s initial year. The reason for this change is to better reflect the ARR for Couchbase Capella products following the launch of Couchbase Capella in fiscal 2022. ARR for prior periods have not been adjusted to reflect this change as it is not material to any period previously presented. We also attempt to represent the changes in the underlying business operations by eliminating fluctuations caused by changes in foreign currency exchange rates within the current period. We calculate constant currency growth rates by applying the applicable prior period exchange rates to current period results.

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include, but are not limited to, quotations of management, the section titled “Financial Outlook” above and statements about Couchbase’s market position, strategies and potential market opportunities. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “continue,” “could,” “potential,” “remain,” “may,” “might,” “will,” “would” or similar expressions and the negatives of those terms. However, not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors, including factors beyond our control, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to: our history of net losses and ability to achieve or maintain profitability in the future; our ability to continue to grow on pace with historical rates; our ability to manage our growth effectively; intense competition and our ability to compete effectively; cost-effectively acquiring new customers or obtaining renewals, upgrades or expansions from our existing customers; the market for our products and services being relatively new and evolving, and our future success depending on the growth and expansion of this market; our ability to innovate in response to changing customer needs, new technologies or other market requirements, including new capabilities, programs and partnerships and their impact on our customers and our business; our limited operating history, which makes it difficult to predict our future results of operations; the significant fluctuation of our future results of operations and ability to meet the expectations of analysts or investors; our significant reliance on revenue from subscriptions, which may decline and, the recognition of a significant portion of revenue from subscriptions over the term of the relevant subscription period, which means downturns or upturns in sales are not immediately reflected in full in our results of operations; and the impact of geopolitical and macroeconomic factors. Further information on risks that could cause actual results to differ materially from forecasted results are included in our filings with the Securities and Exchange Commission that we may file from time to time, including those more fully described in our Annual Report on Form 10-K for the fiscal year ended January 31, 2023. Additional information will be made available in our Quarterly Report on Form 10-Q for the quarter ended July 31, 2023 that will be filed with the Securities and Exchange Commission, which should be read in conjunction with this press release and the financial results included herein. Any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.



Couchbase, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)


Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Revenue:
License $4,798 $6,382 $9,741 $11,389
Support and other 36,156 30,677 69,755 57,651
Total subscription revenue 40,954 37,059 79,496 69,040
Services 2,185 2,732 4,639 5,604
Total revenue 43,139 39,791 84,135 74,644
Cost of revenue:
Subscription(1) 3,845 2,521 7,518 4,917
Services(1) 2,064 2,260 4,313 4,515
Total cost of revenue 5,909 4,781 11,831 9,432
Gross profit 37,230 35,010 72,304 65,212
Operating expenses:
Research and development(1) 16,292 14,341 31,675 28,762
Sales and marketing(1) 32,348 27,473 64,901 54,316
General and administrative(1) 10,459 8,429 20,084 16,355
Restructuring(1) 46
Total operating expenses 59,099 50,243 116,706 99,433
Loss from operations (21,869) (15,233) (44,402) (34,221)
Interest expense (18) (25) (43) (50)
Other income (expense), net 1,255 261 2,688 (295)
Loss before income taxes (20,632) (14,997) (41,757) (34,566)
Provision for income taxes 19 372 769 637
Net loss $(20,651) $(15,369) $(42,526) $(35,203)
Net loss per share, basic and diluted $(0.44) $(0.34) $(0.92) $(0.79)
Weighted-average shares used in computing net loss per share, basic and diluted 46,714 44,648 46,285 44,459

_______________________________ (1) Includes stock-based compensation expense as follows:

Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Cost of revenue—subscription $236 $141 $429 $263
Cost of revenue—services 149 117 294 211
Research and development 3,614 2,087 6,382 3,986
Sales and marketing 4,032 2,463 7,273 4,450
General and administrative 4,086 1,919 7,014 3,267
Restructuring 1
Total stock-based compensation expense $12,117 $6,727 $21,393 $12,177

Couchbase, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

As of July 31, 2023 As of January 31, 2023
Assets
Current assets
Cash and cash equivalents $ 41,437 $ 40,446
Short-term investments 124,361 127,856
Accounts receivable, net 32,453 39,847
Deferred commissions 12,787 13,096
Prepaid expenses and other current assets 8,034 8,234
Total current assets 219,072 229,479
Property and equipment, net 8,581 7,430
Operating lease right-of-use assets 5,620 6,940
Deferred commissions, noncurrent 7,736 7,524
Other assets 2,645 1,666
Total assets $ 243,654 $ 253,039
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $ 3,156 $ 1,407
Accrued compensation and benefits 10,887 12,641
Other accrued expenses 4,874 6,076
Operating lease liabilities 2,984 3,117
Deferred revenue 79,721 71,716
Total current liabilities 101,622 94,957
Operating lease liabilities, noncurrent 3,271 4,543
Deferred revenue, noncurrent 3,219 3,275
Total liabilities 108,112 102,775
Stockholders’ equity
Preferred stock
Common stock
Additional paid-in capital 588,845 561,547
Accumulated other comprehensive loss (301) (807)
Accumulated deficit (453,002) (410,476)
Total stockholders’ equity 135,542 150,264
Total liabilities and stockholders’ equity $ 243,654 $ 253,039

Couchbase, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

Three Months Ended July 31, Six Months Ended January 31,
2023 2022 2023 2022
Cash flows from operating activities
Net loss $(20,651) $(15,369) $(42,526) $(35,203)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization 745 727 1,635 1,466
Stock-based compensation, net of amounts capitalized 12,117 6,727 21,393 12,177
Amortization of deferred commissions 4,702 4,401 9,242 8,410
Non-cash lease expense 776 752 1,548 1,400
Foreign currency transaction losses 249 62 165 1,036
Other (1,030) 103 (1,776) 301
Changes in operating assets and liabilities
Accounts receivable 9,811 (4,452) 7,537 7,329
Deferred commissions (4,322) (3,908) (9,146) (7,706)
Prepaid expenses and other assets (1,523) (1,526) (118) (1,214)
Accounts payable (3,713) 2,812 1,745 3,543
Accrued compensation and benefits 2,306 2,504 (1,754) (5,608)
Accrued expenses and other liabilities (615) 1,106 (1,871) 1,035
Operating lease liabilities (897) (445) (1,723) (1,111)
Deferred revenue 1,526 (1,149) 7,949 (2,117)
Net cash used in operating activities (519) (7,655) (7,700) (16,262)
Cash flows from investing activities
Purchases of short-term investments (56,494) (15,838) (64,315) (69,468)
Maturities of short-term investments 50,697 23,202 70,120 32,802
Additions to property and equipment (1,071) (1,677) (2,359) (2,476)
Net cash provided by (used in) investing activities (6,868) 5,687 3,446 (39,142)
Cash flows from financing activities
Proceeds from exercise of stock options 2,733 753 4,650 3,367
Proceeds from issuance of common stock under ESPP 847 3,525
Net cash provided by financing activities 2,733 753 5,497 6,892
Effect of exchange rate changes on cash, cash equivalents and restricted cash (149) (119) (252) (838)
Net increase (decrease) in cash, cash equivalents and restricted cash (4,803) (1,334) 991 (49,350)
Cash, cash equivalents, and restricted cash at beginning of period 46,783 48,215 40,989 96,231
Cash, cash equivalents, and restricted cash at end of period $41,980 $46,881 $41,980 $46,881
Reconciliation of cash, cash equivalents, and restricted cash within the consolidated balance sheets to the amounts shown above:
Cash and cash equivalents $41,437 $46,338 $41,437 $46,338
Restricted cash included in other assets 543 543 543 543
Total cash, cash equivalents and restricted cash $41,980 $46,881 $41,980 $46,881



Couchbase, Inc.

Reconciliation of GAAP to Non-GAAP Results

(in thousands, except per share data)

(unaudited)



Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Reconciliation of GAAP gross profit to non-GAAP gross profit:
Total revenue $43,139 $39,791 $84,135 $74,644
Gross profit $37,230 $35,010 $72,304 $65,212
Add: Stock-based compensation expense 385 258 723 474
Add: Employer taxes on employee stock transactions 21 22 31 24
Non-GAAP gross profit $37,636 $35,290 $73,058 $65,710
Gross margin 86.3% 88.0% 85.9% 87.4%
Non-GAAP gross margin 87.2% 88.7% 86.8% 88.0%


Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Reconciliation of GAAP operating expenses to non-GAAP operating expenses:
GAAP research and development $16,292 $14,341 $31,675 $28,762
Less: Stock-based compensation expense (3,614) (2,087) (6,382) (3,986)
Less: Employer taxes on employee stock transactions (123) (45) (231) (69)
Non-GAAP research and development $12,555 $12,209 $25,062 $24,707
GAAP sales and marketing $32,348 $27,473 $64,901 $54,316
Less: Stock-based compensation expense (4,032) (2,463) (7,273) (4,450)
Less: Employer taxes on employee stock transactions (330) (67) (450) (103)
Non-GAAP sales and marketing $27,986 $24,943 $57,178 $49,763
GAAP general and administrative $10,459 $8,429 $20,084 $16,355
Less: Stock-based compensation expense (4,086) (1,919) (7,014) (3,267)
Less: Employer taxes on employee stock transactions (59) (13) (88) (84)
Non-GAAP general and administrative $6,314 $6,497 $12,982 $13,004
GAAP restructuring expense $— $— $46 $—
Less: Restructuring(2) (46)
Non-GAAP restructuring $— $— $— $—



Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Reconciliation of GAAP operating loss to non-GAAP operating loss:
Total revenue $43,139 $39,791 $84,135 $74,644
Loss from operations $(21,869) $(15,233) $(44,402) $(34,221)
Add: Stock-based compensation expense 12,117 6,727 21,392 12,177
Add: Employer taxes on employee stock transactions 533 147 800 280
Add: Restructuring(2) 46
Non-GAAP operating loss $(9,219) $(8,359) $(22,164) $(21,764)
Operating margin (51)% (38)% (53)% (46)%
Non-GAAP operating margin (21)% (21)% (26)% (29)%



Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Reconciliation of GAAP net loss to non-GAAP net loss:
Net loss $(20,651) $(15,369) $(42,526) $(35,203)
Add: Stock-based compensation expense 12,117 6,727 21,392 12,177
Add: Employer taxes on employee stock transactions 533 147 800 280
Add: Restructuring(2) 46
Non-GAAP net loss $(8,001) $(8,495) $(20,288) $(22,746)
GAAP net loss per share $(0.44) $(0.34) $(0.92) $(0.79)
Non-GAAP net loss per share $(0.17) $(0.19) $(0.44) $(0.51)
Weighted average shares outstanding, basic and diluted 46,714 44,648 46,285 44,459



_______________________________

(2) For the six months ended July 31, 2023, an immaterial amount of stock-based compensation expense related to restructuring charges was included in the restructuring expense line.


The following table presents a reconciliation of free cash flow to net cash used in operating activities, the most directly comparable GAAP measure, for each of the periods indicated (in thousands, unaudited):

Three Months Ended July 31, Six Months Ended July 31,
2023 2022 2023 2022
Net cash used in operating activities $(519) $(7,655) $(7,700) $(16,262)
Less: Additions to property and equipment (1,071) (1,677) (2,359) (2,476)
Free cash flow $(1,590) $(9,332) $(10,059) $(18,738)
Net cash provided by (used in) investing activities $(6,868) $5,687 $3,446 $(39,142)
Net cash provided by financing activities $2,733 $753 $5,497 $6,892



Couchbase, Inc.

Key Business Metrics

(in millions)

(unaudited)


As of
April 30, July 31, Oct. 31, Jan. 31, April 30, July 31,
2022 2022 2022 2023 2023 2023
Annual Recurring Revenue $139.7 $145.2 $151.7 $163.7 $172.2 $180.7



Couchbase Launches AI Accelerate Partner Program to Advance AI-powered Applications for Customers

Couchbase Launches AI Accelerate Partner Program to Advance AI-powered Applications for Customers

SANTA CLARA, Calif. – August 30, 2023 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced the Couchbase AI Accelerate Partner Program designed to make it easier for customers to build AI-powered applications with Couchbase Capella and support integrations with the broader AI and data ecosystem. The program will provide organizations with resources to quickly integrate their platforms and tools with the industry-leading Database-as-a-Service Couchbase Capella™. This reduces friction for customers who are building and deploying models for AI-driven applications.

The new AI Accelerate Partner Program is part of Couchbase PartnerEngage, a worldwide partner program that provides organizations with access to resources, benefits, custom commercial models and relationships essential to increasing partner sales and maximizing profits. AI Accelerate provides collaboration opportunities for cloud service providers, independent software vendors, system integrators and technology partners in the Couchbase PartnerEngage ecosystem. The benefits of joining the AI Accelerate Partner Program span go-to-market (GTM), technical and enablement categories, including:

  • Eligibility for early access to beta programs and to the Couchbase AI roadmap
  • Customized, hands-on AI-focused workshops with the Couchbase pre-sales team
  • Accelerated path to integration with Capella, including eligibility for extended Capella trials
  • Access to the Couchbase PartnerEngage portal, featuring enablement assets and self-paced online training courses
  • Joint GTM opportunities and eligibility for a listing on the Couchbase website and other co-marketing investments

“Generative AI holds great promise for how companies build applications and the types of experiences they can deliver to their customers,” said Matt McDonough, SVP of business development and strategy at Couchbase. “Couchbase has long invested in the partner ecosystem and believes in collaboration with partners, joint solutions and integrations. This allows partners to deliver the best customer experience so customers can get more insight and value from the data stored in Capella. In order to make it easier for customers to build AI-powered applications on Capella, we are partnering, building integrations and aligning with others in the ecosystem. The new AI Accelerate Partner Program will ensure that our cloud database platform is well positioned to be a key part of the rapidly emerging AI landscape.”

For more information about the Couchbase AI Accelerate Partner Program, please visit www.couchbase.com/ai-cloud-services/.

In addition, Couchbase is pleased to announce that MindsDB and Dataworkz are the first companies to join the program.

“We are witnessing a time where organizations worldwide are transforming their businesses to be more AI-centric,” said Jorge Torres, co-founder and CEO of MindsDB. “At MindsDB, we empower companies to build AI applications fast by connecting their data sources to popular AI frameworks. Becoming part of the Couchbase AI Accelerate Partner Program was an easy decision because it aligns with our core mission of expanding AI’s accessibility to a broader spectrum of businesses. Together with Couchbase, we can provide valuable resources that help customers build AI-powered applications that will drive transformation.”

“World-class large language models (LLMs) require state-of-the-art data, and the hardest part of building an AI application is wrangling data to make it compatible with foundation models,” said Sachin Smotra, CEO at Dataworkz. “Dataworkz enables enterprises to harness the power of private or public LLMs on their own proprietary data using Retrieval Augmented Generation. The Couchbase AI Accelerate Partner Program enables Dataworkz to harness data stored in Capella and provide domain-specific up-to-date context for building AI applications in a managed environment.”

In addition, Couchbase today announced it is introducing generative AI into Capella. With the launch of Capella iQ, organizations will be able to significantly enhance developer productivity and accelerate time to market for modern applications. The new capability enables developers to write SQL++ and application-level code more quickly by delivering recommended sample code.

Couchbase to Advance Developer Productivity by Adding Generative AI to Capella Database-as-a-Service

Couchbase to Advance Developer Productivity by Adding Generative AI to Capella Database-as-a-Service

Capella iQ Will Use Natural Language Processing to Enable Developers to Build Modern Apps Faster and Easier in Capella

SANTA CLARA, Calif. – August 30, 2023 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced it is introducing generative AI capabilities into its Database-as-a-Service Couchbase Capella™ to significantly enhance developer productivity and accelerate time to market for modern applications. The new capability called Capella iQ enables developers to write SQL++ and application-level code more quickly by delivering recommended sample code. Couchbase also announced additional Capella updates that further enhance the developer experience, increase efficiency and ease operations.

Managing the full lifecycle of an application puts pressure on developers and adds friction to their workflow, which can slow down productivity. At the same time, developer productivity has never been more important given the demand for and potential of AI applications. Powered by generative AI, Capella iQ uses foundation models to add intelligence to the Capella developer workbench integrated development environment (IDE). With Capella iQ, developers can use natural language to quickly and easily generate code, sample datasets and unit tests. Capella iQ also advises on index creation, search syntax and other programmatic access to Capella. Leveraging generative AI to build and test applications quicker in Capella delivers higher productivity and quality, resulting in faster time to market.

“The familiarity of SQL++ as the query language was already a great tool to help developers who are new to Capella get up to speed quickly. Capella iQ will take those productivity gains even further and save my team and me tons of time,” said Brant Burnett, systems architect at CenterEdge. “Having a co-pilot like Capella iQ in the developer workbench makes it so much faster for teams to build modern apps on Capella so developers can do what they love, which is building amazing apps.”

“Code that used to take hours for a developer to write will now be generated in a matter of minutes in sample sets from Capella iQ,” said Scott Anderson, SVP of product management and business operations at Couchbase. “This makes developers more efficient when building modern apps, ultimately accelerating innovation for customers. By incorporating generative AI into our fully managed DBaaS, we are making it easier for developers to get started with Capella and significantly boost their productivity.”

For more information about Capella iQ and to sign up for a private preview, please visit www.couchbase.com/ai-cloud-services/.

Couchbase’s mission is to simplify how developers and architects develop, deploy and run modern applications wherever they are. The company delivers a high performance and scalable cloud database platform upon which next-gen applications can be built, such as fraud detection, product catalog recommendations, predictive analytics and more.

“From day one, Couchbase has architected a cloud database platform that enables the most business-critical and demanding applications to perform and provide rich, personalized, differentiated experiences for end users. Combining operational and analytical capabilities, our multi-model platform also seamlessly integrates advanced services like indexing, eventing, full-text search and more in a single solution,” said Matt Cain, chair, president and CEO of Couchbase. “Generative AI is the next great catalyst for modern applications and our customers are exploring ways to build AI-powered apps that can run anywhere with our platform.”

For example, Capella App Services enables edge AI through a predictive query API, which allows mobile applications to use trained machine learning models to run predictive queries locally on mobile devices against stored data. Additionally, Couchbase customers can use Python user-defined functions to run models against the database.

“We are innovating and building for the exciting generative AI market opportunity by driving developer productivity with Capella iQ, expanding our multi-model functions, optimizing AI processing and enabling AI apps from cloud to edge while also building a vibrant AI partner ecosystem,” continued Cain. “Couchbase has been uniquely built for this moment and we are investing in additional AI capabilities that will further extend the value of Couchbase as a cloud database platform for modern applications.”

In addition to investing in product innovation for an AI-powered future, Couchbase believes that a robust partner ecosystem is required to accelerate AI for organizations. Today, the company also announced the Couchbase AI Accelerate Partner Program, designed to make it easier for customers to build AI-powered applications with Capella and support integrations with the broader AI and data ecosystem.

Additional Capella Enhancements

Couchbase today also announced several other new updates to Capella that further enhance the developer experience, increase efficiency and make it easier to operate the cloud database platform. The customer benefits include:

  • Simplified developer experience: Couchbase is extending Capella to more of the developer platform ecosystem highly favored by frontend and full stack developers. New integrations with popular developer tools Vercel and the IntelliJ family of IDEs further reduce friction for developers and development teams.
  • More intelligent operations: By dynamically scaling the disk storage and input/output operations per second (IOPS), Capella clusters can handle growing workloads more efficiently, resulting in faster response times with an improved user experience. The increased disk IOPS enables Capella clusters to handle higher levels of concurrent read and write operations. This ensures that applications remain highly available even during peak usage periods and contributes further to Capella’s best-in-class price performance.
  • Increased security and governance: Capella has achieved independent validation for PCI DSS 4.0 and CSA STAR Level 2 compliance. These enhancements complement the SOC 2 Type II and HIPAA compliance that Couchbase Capella has already achieved, meeting broad enterprise requirements for cloud applications.

These new enhancements are generally available in Capella. Visit couchbase.com/capella to begin a free trial of Capella today.

Additional Resources

Couchbase Announces Date of Second Quarter Fiscal 2024 Financial Results Conference Call

Couchbase Announces Date of Second Quarter Fiscal 2024 Financial Results Conference Call

Santa Clara, Calif., August 16, 2023Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today announced that it will report financial results for its second fiscal quarter ended July 31, 2023 on Wednesday, September 6, 2023 after market close.

Couchbase will host a conference call and webcast at 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time) on the same day to discuss its financial results. The conference call can be accessed by dialing 877-407-8029 from the United States, or +1 201-689-8029 from international locations. The webcast and a webcast replay can be accessed from the investor relations page of Couchbase’s website at investors.couchbase.com.

Operational Efficiency Emerges as Key Driver in Modernization Investments as Enterprise Spending to Hit $33 Million on Average, Couchbase Research Finds

Operational Efficiency Emerges as Key Driver in Modernization Investments as Enterprise Spending to Hit $33 Million on Average, Couchbase Research Finds

SANTA CLARA, CALIF. – July 12, 2023Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today released the findings from its sixth consecutive digital transformation survey of global IT leaders. The research shows that, despite shifting digital transformation goals, enterprises are still investing heavily in IT modernization and implementing new projects. A focus on operational efficiency is influencing how global enterprises invest in digital transformation initiatives. Nearly 60% of enterprises surveyed reported that their key modernization goal is to improve business resilience and efficiency in the face of the evolving global economy. And findings revealed that enterprises’ top IT investment priority in 2023 is empowering developers to build modern applications.

The survey of 600 senior IT decision makers found that enterprises plan to invest on average $33 million in the next 12 months. At the same time, digital transformation priorities have shifted. 78% of IT decision makers confirm their main priorities for transformation have changed in the last three years. 54% say their digital transformation focus has become more reactive to market changes and customer preferences in order to help the wider organization stay agile.

While these changes in digital transformation goals have helped businesses build resilience and weather a dynamic economy, they have not drastically slowed transformation. More than half (53%) of enterprises are either on target or ahead of their planned progress.

“IT modernization and digital transformation are vital strategic initiatives for an enterprise – whether helping to adopt new technologies like generative AI, creating new services or building resilience in times of uncertainty,” said Ravi Mayuram, CTO at Couchbase. “These survey results show how an efficient approach to digital transformation, taking full advantage of advances in data, cloud and AI can help with business resiliency, and at the same time pursue new growth opportunities. And rightly so, empowering developers has emerged as a key priority for enterprises, demonstrating their commitment to innovation.”

Other key findings include:

  • Modernization enhances business resilience: 57% of respondents said their enterprise’s key digitization goal is to improve business resilience and efficiency in the face of an evolving global economy. Increased business resilience was the most common benefit from digital projects in the past 12 months, while increased profitability, employee productivity and application performance are the expected benefits for the next 12 months.
  • Pressure to embrace new technologies: IT leaders are most commonly under pressure from the wider business to adopt serverless computing (identified by 42% of respondents), edge computing and IoT (40%) and low- or no-code technologies (39%). And while AI demonstrates a huge promise in accelerating and transforming businesses, it is still early days. IT teams are under less pressure today to adopt large language models (LLMs) such as ChatGPT, with 35% under pressure to adopt this technology. Web 3.0 and augmented or virtual reality were less of a priority.
  • Developer productivity in the spotlight: Digital transformation projects are a key focus for developers. Pressure from developers on their organizations to support agile development and innovation (44%), and empowering developers to build more applications to meet customer needs (44%) were the top two drivers behind individual transformation projects. Furthermore, enterprises’ top IT investment priority switched from improving application performance in 2021 to empowering developers in 2023.
  • IT spending under increased C-level scrutiny: 49% of respondents say their CFO is managing budgets in more detail and asking more questions about IT investment, while 37% say the pressure to achieve transformation with less budget and staff resources has increased in the last 12 months. And 35% say their IT department is under more strain than at any point in the last five years. This suggests that IT leaders are looking for ways to show cost efficiencies and reduce total cost of ownership.
  • Enterprises report project challenges and delays: Issues such as a lack of buy-in within the business, an inability to secure or stay within budgets and reliance on legacy technology meant enterprises experienced projects failing, suffering delays or being canceled. This cost organizations on average $4.4 million and forced 68% of organizations facing modernization challenges to push digital transformation goals back by more than three months.
  • High expectations and hopes for creative modernization projects: While there have been challenges, research showed that 38% of IT teams are focusing on tangible modernization projects that will provide immediate results. Furthermore, 100% of enterprises have implemented or identified opportunities for creative digital transformation projects that seemed impossible at the end of 2021. This suggests that modern tech continues to push the boundaries of what is possible for business transformation, drive innovation and inspire new next-gen apps.

“It’s clear that IT and business leaders recognize the importance of investing in modernization to drive transformation and achieve their short- and long-term goals efficiently,” continued Mayuram. “Organizations must make sure they are giving development teams the tools required to build modern, powerful and innovative applications to meet any use case in a cost-effective way. This will help them meet their customer demands faster and continue to maintain their leadership position.”

Read the full Couchbase report here.

Additional resources

  • Developers can learn more about how easy it is to build modern apps with the Couchbase Capella™ Database-as-a-Service here.
  • For more information about Capella and to start a free trial, visit this page.
  • To learn how Couchbase drastically reduces the total cost of ownership for customers, visit this page.
More Than Half of Enterprises Confirm Cloud is Essential to Balance IT Spending, Couchbase Research Finds

More Than Half of Enterprises Confirm Cloud is Essential to Balance IT Spending, Couchbase Research Finds

SANTA CLARA, CALIF. – June 21, 2023 – Couchbase, Inc. (NASDAQ: BASE), the cloud database platform company, today released research showing that 58% of enterprises are revising how they split their budget between CapEx and OpEx due to the economic climate, with 54% saying that the cloud is essential to balance IT spending. The majority of enterprises believe that further movement to the cloud is inevitable, with 44% actively looking for ways to reduce and/or control cloud spend. 

A global survey of 600 senior IT decision-makers found that factors such as vendor lock-in; a lack of transparency in cloud spending and costs; and inflexible management tools added 29% to enterprise cloud costs in 2022. Additionally, the survey found that on average enterprises spent $28.91 million on cloud services, resulting in an overspend of approximately $6.5 million. This indicates that flexible technologies that are transparently priced and cost-effective are best positioned to give enterprises a viable path to the cloud while driving business efficiency.

“Cloud is an essential component of the modern technology stack, offering enterprises the scalability, reliability and agility they need,” said Rahul Pradhan, VP of product and strategy at Couchbase. “More than ever, service providers need to deliver highly secure and scalable solutions, alongside flexible deployment options that deliver the right price-performance ratio for businesses. This approach gives customers agility and control over their cloud choices, helping them get the most out of their resources, freeing them to concentrate on driving and accelerating their business.”

Given that some organizations experience challenges with on-premises architecture, including employee training and infrastructure cost management, 53% are moving their spending from CapEx to OpEx, with an average 25% of their CapEx spend switching. Furthermore, by 2026, enterprises are planning for 31% of their total IT spend to be in the public cloud — and are 31% of the way to reaching this goal already. 

Cloud Evolves Role of IT in the Business and Drives Adoption of Self-serve and Low/No-code Technology 

Respondents see IT becoming more consultative, helping other departments make the right IT decisions while minimizing risk. Key insights include:

  • 85% have either begun changing IT’s role to do this, or plan to do so in the next 12 months 
  • 88% have either begun using or plan to use low-code and no-code technologies to help other business units develop applications with minimal input from IT
  • 88% are taking a similar approach with serverless computing so other departments can directly purchase their own cloud services
  • 90% are providing or will provide training for other departments in order to use cloud services more effectively

This does not mean IT will abandon responsibility — only 14% of organizations are using the cloud to drive innovation and new services without IT’s involvement. But it does mean that the skills IT teams need will evolve, with pure technical skills matched by interpersonal, managerial and educational skills to teach the business. 

“The cloud is at the heart of the evolution of IT into a more consultative role, which is becoming even more important with the rising wave of AI-driven applications,” continued Pradhan. “For instance, IT and developer teams can offload database management duties thanks to fully managed cloud services, but in turn they will need to educate and advise other departments on how to use cloud technologies effectively, responsibly and safely — from developing simple applications, to choosing cloud services in a way that doesn’t lead to cost overruns or increase risk. Cloud usage and therefore costs will continue to rise to keep pace with innovation. It’s up to enterprises to invest wisely in tools that will lead to more efficient operations. Modern tools that are both cost-effective and flexible will enable organizations to gain meaningful ROI on cloud technologies.” 

For more information on Couchbase’s cloud research, visit here.