Avalara’s Revenue by Segment (2018 – 2022)

This statistic highlights Avalara’s Revenue by Segment, split between professional services, and subscriptions and returns segments, reported quarterly from Q1 2018 onwards.

Avalara Inc. provides tax compliance automation for businesses, which use the company’s software for everything from preparing and filing tax returns to maintaining documents. The company helps to get tax compliance right. Customers of Avalara are demanding tax duty imposed by the state, local and international governments and are relying on Avalara to offer effective and accurate solutions for managing these requirements. The software is used by industries of all sizes ranging from small companies to Fortune 100 enterprises.

Avalara’s Revenue by Segment

The company generates revenue from two primary segments:

• Professional services
• Subscriptions and returns

The following table sheds more light on each of the segments and their contribution to the company’s overall top line.

(All figures in millions, except percentages)

Avalara Inc. witnessed a growth of 150% in revenue from Q1 2018 to Q1 2021. In Q1 2021, Avalara experienced overall year-over-year growth of 37.82% in revenue.

Professional services

Avalara’s professional services segment generates revenue by providing tax analysis and services, tax registrations, voluntary disclosure agreements, nexus studies, and backfilling services. Moreover, in 2020 the company expanded its scope of professional services and added business licenses and registration services, tax refund claims, and recovery assistance.

Avalara Inc. generated $14.28 million from its professional services segment during Q1 2021. The revenue from this segment has increased by 142.03% year-over-year from $5.90 million in Q1 2020 and contributed 9.30% of the company’s total revenue generated in Q1 2021.

Subscriptions and returns

The company sells its solutions on a subscription basis through its sales department, which focuses on selling to qualified leads provided by the marketing department and through partner referrals. Configurations, data migrations, integration, and training are also available for its subscriptions and returns products. This segment has shown consistent top-line growth since Q1 2018.

Subscriptions and returns generate the majority of Avalara’s revenue, accounting for 93% of total revenue in both 2019 and 2020. In addition, this segment generated approximately 91% of total revenue in Q1 2021. Avalara’s revenue increased by approximately 32% year-on-year from $105.55 million in Q1 2020 to $139.32 million in Q1 2021.

The company had 12,904 customers in Q1 2020 and at the end of Q4 2020, it increased to 14,890. Further, in the first quarter of 2021, the customer count reached 15,580, which represents a 20% increased year-over-year in Q1 2021.

Company Overview

Advantage Solutions Inc. was incorporated in 1999 by Jared Vogt, Patrick Falle, Rory Rawlings, Scott McFarlane. Avalara, Inc. was renamed in December 2005. The headquarters of Avalara is in Seattle, Washington, USA. Avalara, Inc. has 31 companies and 3351 total employees across all of its locations till December 2020.

Avalara has offices in the United States Canada, the United Kingdom, Belgium, Brazil, and India. Every year, the company processes billions of indirect tax transactions for customers and users while also filing over a million tax returns and other compliance documents. The company faces tough competition with TaxJar, Vertex, Sovos, and Thomson Reuters. Avalara ranked among one of the fastest-growing 500 companies in North America on Deloitte’s technology in 2018.

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