SAP Files To Take Qualtrics Public

Experience management software company Qualtrics has filed for an initial public offering, two years after being acquired by SAP.

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SAP acquired Provo, Utah-based Qualtrics for $8 billion in 2018, four days before the latter was supposed to go public. SAP announced its plans to take Qualtrics public in July of this year.

“We decided that an IPO would provide the greatest opportunity for Qualtrics to grow the experience management category, serve its customers, explore its own acquisition strategy and continue building the best talent,” SAP CEO Christian Klein said in a July statement. “SAP will remain Qualtrics’ largest and most important go-to-market and research and development (R&D) partner while giving Qualtrics greater independence to broaden its base by partnering and building out the entire experience management ecosystem.”

In an S-1 registration document filed on Monday, Qualtrics reported nearly $550 million in total revenue for the first nine months of 2020, up about 31 percent from the same period last year. Of the total revenue in that period, about $415 million came from subscription revenue, up 34 percent from about $309.6 million during the same period last year.

The company’s net losses have shrunk 70 percent from around $860 million in the first nine months of 2019 to $258 million during the first nine months of this year. 

The company has more than 12,000 customers and a workforce north of 3,300 people, according to the filing. Qualtrics has employees in more than 25 countries.

As a private company, Qualtrics raised around $400 million in funding from investors including Accel and Sequoia Capital. It last raised a venture round in April 2017, when it landed $180 million in a Series C round led by Accel and Insight Partners.

SAP is the majority stockholder in the IPO with more than 423 million shares (100 percent) of Class B common stock. The company, which intends to list on the Nasdaq under the ticker XM, set an initial price range of between $20 and $24 per share. 

Morgan Stanley and JP Morgan are among the underwriters for the IPO. 

Illustration: Dom Guzman