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Coupa's gross profit for the first quarter of its 2019 fiscal year increased 38 percent year over year to $38.2 million. The quarter ended on April 30. The spend management company's total revenue also increased 37 percent to $56.4 million. The growth largely owed to a 40 percent year-over-year increase in subscription revenue, a 95 percent renewal rate for the second straight quarter and Coupa's professional services business. Company executives also acknowledged revenue from deals originally slated for the second quarter that came in early.
CEO Rob Bernshteyn underscored Coupa's revenue diversification. Six years ago, 95 percent of Coupa's new revenue came from the company's core service, procurement process automation, he said, but Coupa now counts more than 50 percent of new revenue from sources like expense management, invoice processing, supplier information management, contract life cycle management and sourcing optimization. In "every one of these areas, we are seeing real traction," he said.
Operating expenses for the first quarter increased to $50.3 million, up from $38 million for the same period last year. That owes to increased sales and marketing efforts and R&D, according to the company's financial statement.
Coupa expects revenue in the second quarter to land between $56 million and $57 million. For the full 2019 fiscal year, the company projects revenue between $233 million and $236 million. Coupa has managed $747 billion in spend over its history and expects to surpass $1 trillion this fiscal year.
Growing Scope & Capabilities
Coupa acquired Deep Relevance and Spend360 in 2017. According to Bernshteyn, the investment will help the company deliver on the power of its data. "We're in a position now to provide prescriptive intelligence to individual customers," he said, specifically calling out three areas of opportunity: fraud detection across expense, procurement and invoicing; spend optimization; and identification of top suppliers, new suppliers and expiring contracts. Additionally, he said the company is exploring transactional payments and finance and card solutions.
In May, Coupa hired Hiroyuki Okuma as Japan country manager. He will drive strategy and build a team there. While it's still "very early days in Japan," Bernshteyn said, Coupa has a "meaningful marquee account" that it will leverage to expand in the region. Coupa considered entering Japan five years ago. The company wasn't ready then, Bernshteyn said, "but we're ready now."
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