ChargePoint Holdings, Inc.

Ladies and gentlemen, good afternoon. My name is Lisa and I'll be your conference operator for today's call. At this time, I would like to welcome everyone to the ChargePoint first quarter fiscal 2024 earnings conference call and webcast. All participant lines have been placed on a listen-only mode to prevent any background noise. After the speaker's remarks, there will be a question and answer session. I would now like to turn the call over to Patrick Hamer, ChargePoint's Vice President of Capital Markets and Investor Relations. Patrick, please go ahead.

Good afternoon, and thank you for joining us on today's conference call to discuss ChargePoint's first quarter fiscal 2024 earnings results. This call is being webcast and can be accessed on the investor section of our website at investors.chargepoint.com. With me on today's call are Pascale Romano, our chief executive officer, and Rex Jackson, our chief financial officer. This afternoon, we issued our press release announcing results for the quarter ended April 30th, 2023, which can also be found on our website. We'd like to remind you that during the conference call, management will be making forward-looking statements, including our outlook for the second quarter of fiscal 2024. These forward-looking statements involve risks and uncertainties, many of which are beyond our control and could cause actual results to differ materially from our expectations. These forward-looking statements apply as of today and we undertake no obligation to update these statements after the call. For a more detailed description of certain factors that could cause actual results to differ, Please refer to our Form 10-K filed with the SEC on April 3rd, 2023, and our earnings release posted today on our website and filed with the SEC on Form 8-K. Also, please note that we use certain non-GAAP financial measures on this call, which reconcile to GAAP in our earnings release and for certain historical periods in the investor presentations posted on the investor section of our website. And finally, we'll be posting the transcript of this call to our investor relations website under the quarterly results section. And with that, I'll turn it over to Pasquale.

Thank you, Patrick, and thank you all for joining us today. We delivered a strong first quarter. Revenue was at the high end of our guidance range at $130 million, and non-GAAP gross margin sequentially improved two points to 25%. To put these results into perspective, we achieved a 59% year-over-year growth rate in the first quarter and had the second largest quarter in ChargePoint's history. We did that while the EV install base in North America and Europe are still in single digits, and the EV market is only at the beginning of a decades-long growth cycle. We also achieved this growth in the midst of a challenging macroeconomic environment. Diversification across verticals and geographies continues to contribute resilience to our business. So while we saw less growth in North American commercial and residential than we would have liked due to what we believe is a delay in discretionary purchases, We continue to see overall growth and margin improvement. Rex will address guidance for the second quarter. But just to give you a sense of the magnitude of the long-term opportunity ahead of us, the midpoint of that guidance would make Q2 the largest quarter in ChargePoint's history. You'll also hear Rex talk about non-GAAP adjusted EBITDA. To give some context, we use non-GAAP adjusted EBITDA as a key measure of the health of our business as we drive towards profitability, and as we disclose in our proxy statement filed last week, this metric is one of the two components of our annual management bonus program. Beneath the top line results, we're continually improving our operations and investing for future scale. We've consistently improved gross margins while recovering from supply chain issues, making meaningful changes to the cost of our products, and optimizing our operations. Also, as we scale, we're carefully managing our operating expenses while making the necessary investments in our support operations and internal business systems. We are committed to delivering dependable infrastructure to our customers so drivers can find it, use it, and depend on it everywhere. Turning back to Q1, we saw two areas of particularly strong growth, Europe and fleet. For the first time in our history, Europe delivered over 20% of ChargePoint's quarterly revenue. Meanwhile, Q1 fleet billings more than doubled year over year, despite supply limitations on vehicles entering the segment relative to demand, and as a percentage of billings, fleet increased from Q4.