Hi, and welcome to today's webcast with Checkin.com Group that is presenting its Q1 report. Today we have the company's CEO, Kristoffer Cassel, and the CFO, Martin Bäuml, with us presenting. My name is Martin Westerlund and I'm from Finwire.tv. If you have any questions, you can ask them in a forum that is located to the right. With that said, I'll give you guys the stage. Please go ahead.
Thank you, Martin. My name is Kristoffer, and as the other Martin said, Martin Bäuml, our CFO, is also on the call. For those of you who have followed us as a company, I think we'll keep the same format of this presentation as previous quarters, where we start off, I dig in a bit of the highlights from a business perspective, followed by Martin, who looks a bit at the numbers, and then we end up with some questions at the end. We assume that most of you know who we are as a company and also have read the quarterly report already. We will cut to the chase.
My first slide is actually a repetition of the exact same slide I had last quarterly report, which is that we then felt that we have geared up to a new level. I think with this quarterly report in our backs, we feel even more confident that we are now at a new level as a company. That's because this quarter continues to deliver strong and increasing growth. Our revenue grows with 107% year-on-year, and this is driven by really strong demand. We're lucky, as we talked a bit about before, that long-term trends, regulation of internet, globalization of internet businesses are very positive for us. We also have a strong Net Revenue Retention, which is 140% this quarter.
Strong growth from new clients, strong growth from existing clients. We have also had the capacity to capture these opportunities as an organization. We feel all in all, this quarter is a step towards our long-term targets, and we need to continue to stack good quarters like this on top of each other to reach the goal, which is to grow 86% per year up until 2025 and have a net revenue for that year of SEK 500 million. If we look at the quarter, this quarter compared to previous quarters, we saw a very strong growth in Q4. We see continued growth, and we think we have still a strong wind blowing in our direction.
I think we see positively also on the coming quarters. Next illustration is trying to capture that we feel it's also a break of the previous seasonality trends that we have seen. This illustration is if we look at 2021 last year, at New Year's, we had 86% growth, so Q4 2020, which then went down to 65% during Q1, increased again to 72% in Q2, 72% in Q3, and we ended Q4 with 84% growth year-on-year in net revenue. This year, again, the same 84% that we start with Q1 is instead dramatically up to 207% year-on-year growth.
It will be really interesting to see, I think, in the coming quarters and the coming year, how the rest of the year develops seasonality-wise. We think we are, as I said, sort of at a new level. We continue to invest in growth. We are lucky to have high gross margins. As Martin will talk about a bit later, it's 86% in Q1. This gives us room and cash flow to invest in new sales, marketing, as well as in investments in R&D and technology on the long term. We're seeing already now that the new sales organization that we built during the past quarters are really starting to contribute now to the growth.
When it comes to the marketing spend, we're still spending. I think it's three times what we spent, same period last year. We see the marketing spend as a percentage of revenue that it flattened slightly. This is because we achieve better efficiency in the marketing spend. I think here it's fair to assume that the marketing spend flattens out at around 25%. That's somewhere in the region where we will have the most efficient spend and growth. We will continue to invest in our technology. At the same time, we have a very scalable model. I think it's also fair to assume that EBITDA margin increases gradually, quarter by quarter. We invest because we see still huge opportunities ahead of us this year and into the future.
First of all, we have a better technology than ever, both thanks to the investments we have taken ourselves into R&D, but also the additional technologies that we added through the purchase of GetID last year, as well as DATACORP, which is two very interesting technology companies that we added to our software. We have a really great offering. We still have large opportunities to broaden into additional verticals. One example is Pacaso, which is a really fast-growing U.S. unicorn, who is doing rental apartments for holiday homes or holiday home rentals. That's just one example of many sectors that we see incoming customers from and where we are able to sign new customers.
Speaking about the U.S., and North America, we feel that's a large untapped market for us in terms of the biggest enterprise clients in the world. The biggest players on the internet as a whole are located in the U.S., and we have managed to get some clients, like Pacaso, for example, but we believe there's a lot of untapped potential. I think the coming quarters and during this year we will talk more about the U.S. It will be a big focus for us and rightly played, I think it could become a really strong growth engine for us, the coming years. We also see that there is still potential for us to keep sharp and make our growth even more efficient.
Both to make sure we use the capital in an even more efficient way, but also that we speed up the sort of return in terms of the time it takes from when we spend the money until we get the payback. Here, as one example of that, I think is that our platform strategies is really gaining momentum. We're seeing big potential in the benefit to cooperate with technical platforms that can integrate our solution so it's already integrated and also to create new contact points and sort of interfaces with potential customers. We are, for example, already cooperating with Aspire Global within this field. After the quarter closed, we announced a deal with Playtech and Playtech is one of the world's leading iGaming platforms.
The deal basically says that our software will be integrated to the platform, and it will be offered, marketed and sold jointly by us to Playtech's customers globally. We think this really could speed up the scale-up and sort of enable sales in bulk. Instead of selling customer by customer, we can hopefully sell to many customers at once in an efficient way. In many other ways, we continue along the chosen path. It is about new customers, continue to invest in acquisition and global scalability. We have right now 171 customers. It's about the existing customers to continue to deliver software with high quality and high value that makes them use us more and more, turn on more additional services.
Here we have the NRR figure of 140%. Also acquisitions. We did two acquisitions last year, like I mentioned, and here it's about acquiring technology and teams that we think can add to the broad software or the broad offering that we have. With the markets changing quickly when it comes to valuations, I think it's fair to assume that we need to see some more stability in valuations before we make new acquisitions. We believe that will happen. There will be opportunities ahead, and in many ways it's a relative game when it comes to valuations of companies.
We've seen that the private market has lagged behind a bit, but as that converge, I think there will be interesting opportunities, even for further acquisitions. Our 2025 targets remains, it is to grow 86% annually for the coming years. That's both organically and through acquisitions. If we manage that, we will reach a net revenue for the full year 2025 of SEK 500 million. That's the target we work towards, and I think with this quarter in our back, we feel more confident than ever. With that, I hand back to Martin to look at the figures a bit.
Thank you very much. I'd start off with some highlights. There are a lot of details in the actual report, but the financial highlights is that the net revenue increased by 107% to SEK 15.8 million. Gross profit more than doubled, and the gross margin was 86%. As Kristoffer mentioned, we continue to invest in sales and marketing, and it remains at a level three times higher than last year. EBITDA just below breakeven with a margin of -4% and cash flow from operating activities in line with EBITDA at -SEK 835,000 . We ended the year with SEK 62 million in cash and an equity ratio of 81%.
If we turn to the next page here, with the net revenue, if you followed us before, you recognize this picture, and here we've added a new year and also the biggest building block in the company's history with a revenue of SEK 15.8 million in the quarter. That was a growth compared to last year of 107%. It's also a higher growth than we've had in the previous quarters. It's also slightly higher in line with our financial targets that Kristoffer referred to earlier.
It might be worth noting here, and as you can see easily in the picture, that the revenue in the quarter now in Q1 2022 is actually higher than the combined revenue in Q1 and Q2 in 2021. It's also higher than the combined revenue of Q1, Q2, and Q3 in 2020. We're a much bigger company now, and it's also a good illustration of the growth journey that we're on. Turning to gross profit here, as I said, we've more than doubled the gross profit up to SEK 13.6 million. As you can see on the chart to the right, we continuously managed to increase the gross margin, and that landed on 86% in the quarter.
I think the most important takeaway here is the absolute number and that we've doubled the gross profit and that we have SEK 13.6 million of kind of cash flow that we can reinvest in growth-generating activities. I'm thinking especially about product development and sales and marketing. Turning to sales and marketing, then, I think we communicated a couple of quarters back that we have increased that a lot, and it's a main focus area for us also for this quarter. You can see in the graph here that we've more than tripled our sales and marketing expenses compared to the same period last year.
As Kristoffer also mentioned, we've seen some higher efficiency and in relation to net revenues, it's actually leveled off somewhat and went down to 28% of the net revenues, even though we have tripled the investment in sales and marketing in absolute terms. As you can see in the picture, we've also actually spent more in this quarter alone than we did in the whole year of 2020, which is also, you know, a proof point that we're a much bigger company now, and that this area of sales and marketing is a big focus area for us.
Going to EBITDA, so even though we continued to invest heavily, we still had an EBITDA quite close to zero, or quite close to breakeven. We had a negative EBITDA of -SEK 700,000 corresponding to a margin of -4%. That was to a large extent driven, as I said, by our strong growth and high gross margin that we've managed to keep the EBITDA at that level. It's also slightly better than the full year of 2021, and I think we see in the future that we will probably further increase the EBITDA margin over time.
The last page here on cash and equity ratio, we ended the quarter with SEK 62 million in cash, and we have an equity ratio of 81%. With that, I hand back the microphone to Kristoffer for a summary and some concluding remarks.
Thank you, Martin. This is very short summary. I'm basically just saying what Martin said, which is that we have a strong and increasing growth. We have high gross margins which we can use to continue to invest in long-term growth activities, and we have a strong financial position. I look very much forward to this year, and it will be exciting to see what the future holds for us. With that, I say thanks for you guys listening and look forward to hear some questions. Back to Martin from Finwire.
Thank you very much, Kristoffer and Martin, for that presentation. Now we'll jump straight into the Q&A. We'll start with the first question. Of the two customers that you have signed, Playtech and Pacaso, where do you see the most potential?
It's a good question. I can start off by, of course, pointing out that we have signed many more clients than those, but those are the two we have sort of highlighted. We said that with the Playtech deal that's a strategic cooperation deal that is important for us in a sort of strategic perspective. Pacaso is, of course, nice in that it shows that we're able to take a U.S. enterprise clients and sort of shows a flavor of what the potential is on the North American market. Of course, I think Playtech has a larger strategic importance.
I think you should look at Pacaso more as an indication of what might happen if we play our cards right in the U.S.
Thank you for that answer, and we'll take the next question. How many of your customers are using both of your solutions for check-in flow/data optimization along with ID verification, and how is the revenue divided between those segments?
Yeah. Our software solves the problem from when you say you want to become a customer until you have become a customer. How you sign up, identify yourself, and log in. Some partners choose to use just some parts of the flows or some parts of the solution, but most of them are using the full software, and that's the strength of it, right? At the same time, you're seeing the NRR figure I described previously, which is 140% in this quarter, comes from the fact that our existing clients, in many cases, start off using our product, for example, in a few geographies or using just part of the solution. Over time, when they see that it works, they expand the usage with us, and that drives the net revenue retention.
The revenue comes from a mix, but it's the broadness of our software that I think is unique and why we can have the high gross margins and see this efficient growth that we're seeing.
Perfect. Thank you very much. We'll take the next question. How would you say the competition is?
It's a good question. I think the starting point is, of course, it's not only us who understands that area of how you become a customer and the area of how you identify people online, that needs to change and will change. There's very strong macro trends for that to happen. Most other companies are focused either on a thin area, like a solution to one of the problems or sort of aggregators of other solutions and so on. Like I said before, I think the unique offering that we are having, which is taking the full customer experience from when you say you want to become a customer until you have checked in, as we call it.
We're uniquely positioned there and when we speak to clients, most of the times, or I would say almost all times, they are looking to, as an alternative to using our software, is to build this in-house using bits and pieces that you buy from other companies, but where you still need a team that builds this together for each market in each situation and try to optimize it, sort of do it yourself style. Our software, of course, replaces that. Our competition is mainly with in-house built solutions.
Okay. Thank you very much. We'll take the last question. What are you the most excited for about the remainder of the year?
Very good question. I think I highlighted some of it in the slide about the year ahead. I think the U.S. stands out. It's something we will speak a lot about. It's huge potential for us. Also, of course, a challenge. That I look forward to a lot. But also on a technical level, we have done a lot of R&D and also combined some of our technology with the technologies that we acquired through the DATACORP and its co-workers are specialized in developing AI software for image analysis based on neural network algorithms, computer vision and machine acquisition. I think here in the coming quarters, we will show a bit more and it's pretty cool technology, I must say. I look forward for that as well to show the world what we're working on.
Okay. Thank you very much, Martin and Kristoffer, for presenting today and answering our questions. A big thanks to all of you that has followed Checkin.com's webcast today presenting their Q1 report. I hope you have a great rest of the day, and I hope to see you soon. Thank you and goodbye.
Thank you.