Arlington-based Opower posted its first earnings as a public company Thursday, recording widening losses in the first quarter despite a 50 percent increase in revenue compared to the same period a year ago.
The results provide almost a textbook example of the financial picture at a high-growth company, or one focused on generating new sales even if that requires investments that push off profitability.
Chief financial officer Thomas Kramer said growth has always been Opower’s near-term goal. The company, which provides software to the utilities industry, will continue to hire employees and invest in new products — and likely post losses as a result — for this year and next.
Opower hopes to be profitable in 2017, Kramer said.
“You will see widening loss. That is the plan. We’re doing that to beef up our sales and marketing investments, as well as being able to invest in continued research and development in our product set,” he said.
The firm posted a net loss of nearly $7 million, or 32 cents a share, for the first three months of the year, compared to a net loss of $2.7 million, or 13 cents, for the same period in 2013.
Perhaps more important to the firm’s financial picture is its revenue growth, Kramer said. The firm brought in $28.6 million during the first quarter, a 50 percent increase over the $19 million it made during the first quarter last year.
“For us, the most important thing is generating value for our customers,” Kramer said. “The fact that you see a rapid growth rate in revenue is a manifestation of that.”
Kramer attributed the boost in revenue to a couple of major sources.
“The first is signing new companies that we haven’t dealt with before, but just as important to us is a widening relationship with existing customers. We go back to them and sell more,” he said.
Opower sells software to utility companies to help them manage relationships with customers and track their customers’ energy usage. The utilities then share those results with customers to get them to reduce energy consumption.
The company has made a global push in recent years, adding large utility providers across Europe and Asia to its roster of clients. Kramer said about 14 percent of revenue came from outside the United States in the first quarter, compared to 3 percent two years ago.
Opower went public in April as part of a rush of companies looking to capitalize on a marketplace that has become more hospitable to young firms. Landover-based 2U is among the other companies with initial public offerings this year.
The higher-education company reported Monday revenue of $26.3 million, an increase of 38 percent compared to $19.1 million in the first quarter of 2013. It also posted a net loss of $7.1 million, or 93 cents a share, for the quarter compared to a loss of $3.8 million, or 52 cents, during the same period last year.
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