Docebo Company Presentation
Appendix: Key Performance Indicators
Annual Recurring Revenue: We define Annual Recurring Revenue as the annualized equivalent value of the subscription revenue of
all existing contracts (including Original Equipment Manufacturer ("OEM") contracts) as at the date being measured, excluding non-
recurring implementation, support and maintenance fees. Our customers generally enter into one to three year contracts and are
noncancelable or cancellable with penalty. All the customer contracts, including those for one-year terms, automatically renew
unless cancelled by our customers. Accordingly, our calculation of Annual Recurring Revenue assumes that customers will renew
the contractual commitments on a periodic basis as those commitments come up for renewal. Subscription agreements are
subject to price increases upon renewal reflecting both inflationary increases and the additional value provided by our solutions. In
addition to the expected increase in subscription revenue from price increases over time, existing customers may subscribe for
additional features, learners or services during the term. We believe that this measure provides a fair real-time measure of
performance in a subscription-based environment. Annual Recurring Revenue provides us with visibility for consistent and
predictable growth to our cash flows. Our strong total revenue growth coupled with increasing Annual Recurring Revenue indicates
the continued strength in the expansion of our business and will continue to be our target on a go-forward basis.
Net Dollar Retention Rate: We believe that our ability to retain and expand a customer relationship is an indicator of the stability of
our revenue base and long-term value of our customers. We assess our performance in this area using a metric we refer to as Net
Dollar Retention Rate. We compare the aggregate subscription fees contractually committed for a full month under all customer
agreements (the "Total Contractual Monthly Subscription Revenue") of our total customer base (excluding OEM partners) as of the
beginning of each month to the Total Contractual Monthly Subscription Revenue of the same group at the end of the month. Net
Dollar Retention Rate is calculated on a weighted average annual basis by first dividing the Total Contractual Monthly Subscription
Revenue at the end of the month by the Total Contractual Monthly Subscription Revenue at the start of the month for the same
group of customers.
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