In early 2023, we reported on Thinkific’s journey toward profitability following multiple waves of layoffs.
“Profitability is in sight,” Greg Smith, cofounder and chief executive of Thinkific, stated last year, months after the firm laid off 20% its staff.
Founded in 2012, Thinkific went public in 2021 on the Toronto Stock Exchange under the ticker symbol “THNC” with shares rising as high as $19.47 in 2021, giving Thinkific a peak market capitalization of over $2 billion—but by the time of the initial layoffs, THNC was trading at less than $3 per share.
This week, the Vancouver-based technology company posted its latest quarterly earnings report, and the path to profitability is as clear as it has ever been for the digital courses platform: Thinkific posted a net quarterly income of $0.3 million, compared to a net loss of nearly $4M in the year-ago quarter.
“Thinkific delivered a solid Q4 to end what was truly a milestone year for the company,” CEO Smith stated.
Quarterly revenue increased 13% year-over-year to $15.6 million compared with the fourth quarter of 2022, while commerce revenue increased 96% year-over-year to $1.8 million, building on the success of Thinkific Payments and other recently launched tools.
“In 2023 we achieved our cost efficiency and productivity targets, while continuing to grow the top line in double digits,” Smith said. “We also released more new and innovative products and features in the past twelve months than in any other time in our history.”
This marks the fifth consecutive quarter of year-over-year growth for Thinkific, he notes.
“The Thinkific Platform has never been easier for our customers to start a business, sell their digital products, and grow their businesses to new heights,” Smith believes. “We are seeing evidence of this success of our customers in key performance metrics in the business.”
Thinkific’s annual revenue for fiscal 2023 increased 15% to $59.1 million from 2022.
“Our commitment to a strategy of profitable growth resulted in our second consecutive quarter of positive Adjusted EBITDA and cash flow from operations while still maintaining double digit growth,” added Corinne Hua, who serves as chief financial officer at Thinkific. “In 2024, we plan to take advantage of our strong financial position and make targeted investments in areas we believe will result in an acceleration of revenue growth.”
As a sign of self-belief, Thinkific repurchased and cancelled 393,336 shares.
It’s all part of “significant momentum” that Smith asserts Thinkific is imbued with in 2024. According to the CEO, the company is in a “good position to accelerate top line growth while maintaining our commitment to remain profitable.”
“This sets the stage for 2024,” he said, adding that “Our primary focus continues to be on the success of our customers and providing them with the tools they need to grow their businesses.”
Thinkific today enables 50,000 active creators to earn hundreds of millions of dollars while instructing tens of millions of students globally.
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