The Nearmap Ltd (ASX: NEA) share price is up 14% after announcing a strong update.
Nearmap is an aerial imaging business which provides high-quality images, city-scale 3D content, data sets and geospatial tools.
Growth update boosts the Nearmap share price
The ASX tech share share said that it has reached another key financial milestone. For the first time, it has reached an annual contract value (ACV) of $150 million.
It also said that the North American ACV portfolio had, for the first time, surpassed US$50 million. This also meant that the North American ACV had surpassed the ANZ ACV portfolio. Management has expectations that the North American ACV portfolio will continue to be the larger contributor for the group ACV.
Nearmap said that the Australia and New Zealand business continues to perform well.
Major contract
The company also said that it had signed its largest ever government annual contract in North America, with premium content a key factor in the win.
It said that it continues to successfully drive its strategy across its core verticals. Nearmap said that the largest ever government annual contract win demonstrates the enormous value and benefits government organisations gain from Nearmap technology, data, content and analysis.
Management commentary
Nearmap CEO and Managing Director Dr Rob Newman said:
Nearmap is in an incredible position where we continue to win new customers and retain existing customers due to our world-leading location intelligence offering. In achieving for the first time the milestone of $150 million in group annual contract value, we again show the strength of our technology and data, and expertise of our global team. To announce this ACV milestone in the same month we signed our largest ever government annual contract in North American shows our global growth engine continues to power ahead.
Guidance
Nearmap confirmed that it expects the group ACV portfolio to finish FY22 at the upper end of the guidance range of between $150 million to $160 million. This would be growth compared to the FY21 ACV of $128.2 million.
Final thoughts on the Nearmap share price
It’s good to see that the business continues to grow. Since 8 March 2022, the Nearmap share price has risen by more than 30%. It’s recovered most of the lost ground since the start of the year, though it’s still down by around 5%.
Nearmap continues to grow, but I’m unsure about how much long-term growth potential it has. There are other ASX growth shares that I have on my radar.
