SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This Annual Report on Form 10-K contains, and our officers and representatives may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risks and uncertainties. All statements contained in this Annual Report on Form 10-K other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words "believe," "may," "will," "potentially," "estimate," "continue," "anticipate," "plan," "intend," "could," "would," "expect" and similar expressions that convey uncertainty of future events or outcomes are intended to identify forward-looking statements. Forward-looking statements included in this Annual Report on Form 10-K include, but are not limited to, statements regarding:
We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Part I, Item 1A. "Risk Factors" in this Annual Report on Form 10-K. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and trends discussed in this Annual Report on Form 10-K may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, whether written or oral, except as required by law.
In this Annual Report on Form 10-K, the words "we," "us," "our" and "Yext" refer to Yext, Inc. and its wholly owned subsidiaries, unless the context requires otherwise.
Item 1. Business
Overview
Yext is a knowledge engine. Our platform lets businesses control their digital knowledge in the cloud and sync it to our PowerListings Network of approximately 150 service and application providers including Apple Maps, Bing, Cortana, Facebook, Google, Google Assistant, Google Maps, Siri and Yelp. Digital knowledge is the structured information that a business wants to make publicly accessible. For example, in food service, the address, phone number or menu details of a restaurant; in healthcare, the health insurances accepted by a physician or the precise drop‑off point of the emergency room at a hospital campus; or in finance, the ATM locations, retail bank holiday hours or insurance agent biographies. We believe a business is the ultimate authority on its own digital knowledge, and it is our mission to put that business in control of it, everywhere.
Intelligent search, which are searches of digital knowledge that combine context and intent, has grown significantly in recent years. Unlike traditional web-based search where many results are displayed as a list requiring further exploration, web and mobile applications and voice and artificial intelligence, or AI, engines are increasingly answering questions directly and in certain cases providing only one answer. As intelligent search grows, and increasingly leverages AI, consumers are more likely to rely on these direct answers, rather than clicking through to a business's website to find information about a company. The source of the results for intelligent searches is not a web page - it is structured data. Businesses and service providers want their digital knowledge to be accurate, compelling and more prominent than that of their competitors when consumers look for them on search platforms, mobile applications, voice assistants, social media, connected devices and other digital sources. Our solution drives commerce by providing updated digital knowledge that allows consumers to find the businesses and service providers that are most relevant to them.
The vast majority of digital knowledge provided by searches currently comes from third‑party sources such as data aggregators, governmental agencies and consumers. The net result of this third‑party sourcing has been to produce “best guess” data that can often miss or misstate the true digital knowledge for businesses worldwide. We pioneered a better way to source critical digital knowledge. We have built our business on the fundamental premise that the best source of accurate and timely digital knowledge about a business is the business itself. We have established direct data integrations with applications in our PowerListings Network that end consumers around the globe use to discover new businesses, read reviews and find accurate answers to their queries. Our platform ensures that our customers’ digital knowledge is available, accurate and consistent across our PowerListings Network. Businesses can directly control their own digital knowledge rather than leaving it in the hands of third parties, thereby making our platform the system of record for such vital knowledge.
We are increasingly using the structured data on our platform to expand or add new integrations with vertically specialized applications, voice‑based search and AI engines. Our provision of structured digital knowledge, directly produced and managed by businesses and professional service providers themselves, helps ensure the accuracy of search results whether they are presented in traditional search results, an information card or an answer from a digital assistant.
The Yext Knowledge Engine is the core of our platform and enables businesses and professional service providers of all sizes to:
We offer our cloud‑based Knowledge Engine platform to customers on a subscription basis in several packages. Each package provides varying levels of access to our key features, including Listings, Pages and Reviews. Our Listings feature provides customers with control over the digital presence of their location and other related attributes published on the most widely used third‑party applications. Our Pages feature gives our customers the ability to create individual web pages for their business, enabling control over the image and efficacy of their digital appearance on their own sites. Our Reviews feature enables customers to encourage and facilitate reviews, thereby increasing the quantity and quality of the reviews available to potential consumers and improving the search relevance for their businesses on our PowerListings Network. Ultimately, these and our other features and solutions help ensure that the critical digital knowledge created by businesses and professional service providers and delivered to the consumer is accurate, consistent, up to date and compelling.
Businesses and professional service providers of nearly all sizes and in a diverse set of industries, such as healthcare, retail and financial services, can benefit from our platform and capabilities. Today, our customers use our platform to control digital knowledge covering approximately 29,137,000 attributes and approximately 1,468,000 licenses. The term licenses includes not only locations, but
also the number of persons and other entities managed on our platform, such as physicians, wealth advisors and insurance agents, among others. We believe this term reflects the broadening of our business into new services and our current pricing methodology.
We have experienced rapid growth in recent periods. For the fiscal years ended January 31, 2018, 2017 and 2016, our revenue was $170.2 million, $124.3 million and $89.7 million, respectively, our net loss was $66.6 million, $43.2 million and $26.5 million, respectively, and our non‑GAAP net loss was $44.2 million, $33.3 million and $22.0 million, respectively.
Industry Background
Consumer Discovery Has Changed. Intelligent search has grown significantly in recent years. Businesses are now able to leverage intelligent search to help individuals discover what they need without having to necessarily visit the business’s own website and return digital knowledge directly responsive to a search.