TeamViewer growth thanks to work-fromhome trend
German software company TeamViewer reported a 75 percent jump in first-quarter billings on Tuesday as people around the world used its remote connectivity services to work from home during the coronavirus pandemic. That smashed its own guidance, which the company had raised in March, for billings growth of 60 percent. TeamViewer increased its target for billings in 2020 to 450 million euros ($486 million) and forecast a core profit margin of 56 percent.
“TeamViewer’s
long-term growth drivers remain intact and have been accelerated by high demand for our solutions following the global quarantine measures to contain the COVID-19 pandemic,” CEO Oliver Steil said. Shares in TeamViewer traded 2.7 percent higher, having gained more than 60 percent from the price at which they were marketed to investors last September by private equity investor Permira, which retains a controlling stake. Since then, its leverage ratio has come down to 2.4 times core earnings from 3.7 times, putting the company in a position to finance small acquisitions from cash on its
HIGHLIGHTS
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Raises 2020 guidance for billings, margins.
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Deleveraging opens up M&A potential.
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Steers clear of videoconferencing sector.
balance sheet or consider larger deals.
Steil told Reuters that TeamViewer would stay disciplined as it scans the market for opportunities. “We don’t need mergers and acquisitions to be a very fast-growing company,” he said.
Anytime, Anywhere
TeamViewer offers “anytime, anywhere” connectivity that has been used to remotely operate snow cannons at ski resorts and transfer data to the International Space Station.
Its ‘freemium’ model aids quick adoption, with TeamViewer only billing users once it establishes they are working in a business setting. Its software has been installed 2.25 billion times and it now counts 514,000 paying users. It is also marketing an enterprise product, and the number of customers with an annual contract value of more than 10,000 euros increased by 153 percent on a year earlier to 1,183 at the end of March. Steil made it clear that TeamViewer would resist the temptation to expand aggressively into the fast-growing videoconferencing sector, despite offering its own TeamViewer Meeting and Blizz products to business customers.