[July 24, 2014] |
|
Riverbed Reports Second Quarter Fiscal Year 2014 Results
SAN FRANCISCO --(Business Wire)--
Riverbed Technology (NASDAQ:RVBD), the leader in application performance
infrastructure, today reported financial results for its second quarter
fiscal 2014 (Q2'14) ended June 30, 2014.
Q2'14 GAAP Financials
GAAP revenue for Q2'14 was $264 million, compared to $250 million in the
second quarter of 2013 (Q2'13), representing 6% year-over-year growth.
GAAP net income for Q2'14 was $6.8 million, or $0.04 per diluted share,
compared to a net loss of $16.5 million, or ($0.10) per diluted share,
in Q2'13.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions, except EPS)
|
|
|
|
Q2'14
|
|
|
Q1'14
|
|
|
Q2'13
|
|
|
Change Q/Q
|
|
|
Change Y/Y
|
Revenue
|
|
|
|
$264
|
|
|
$265
|
|
|
$250
|
|
|
-%
|
|
|
6%
|
Net Income
|
|
|
|
$6.8
|
|
|
$3.3
|
|
|
($16.5)
|
|
|
$3.5
|
|
|
$23.3
|
EPS
|
|
|
|
$0.04
|
|
|
$0.02
|
|
|
($0.10)
|
|
|
$0.02
|
|
|
$0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2'14 Non-GAAP Financials
Non-GAAP revenue for Q2'14 was $264 million, an increase of 4% compared
to $255 million in Q2'13. Non-GAAP net income for Q2'14 was $42.6
million, or $0.26 per diluted share, compared to non-GAAP net income of
$36.6 million, or $0.22 per diluted share, in Q2'13.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions, except EPS)
|
|
|
|
|
Q2'14
|
|
|
Q1'14
|
|
|
Q2'13
|
|
|
Change Q/Q
|
|
|
Change Y/Y
|
Revenue
|
|
|
|
|
$264
|
|
|
$266
|
|
|
$255
|
|
|
-1%
|
|
|
4%
|
Net Income
|
|
|
|
|
$42.6
|
|
|
$40.4
|
|
|
$36.6
|
|
|
5%
|
|
|
17%
|
EPS
|
|
|
|
|
$0.26
|
|
|
$0.24
|
|
|
$0.22
|
|
|
$0.02
|
|
|
$0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
"Second quarter financial results were in-line with our revised guidance
and were affected by longer sales cycles primarily attributed to certain
verticals and territories," said Jerry M. Kennelly, chairman and CEO.
"Despite this, our ongoing commitment to disciplined expense management
enabled us to deliver solid earnings per share consistent with the
expectations we outlined at the outset of the quarter," continued
Kennelly. "Riverbed is undergoing an exciting transformation. Our vision
and strategies enable our customers to embrace location-independent
computing through a comprehensive platform of solutions. We made
important strides in the second quarter to extend beyond our core WAN
optimization business as evidenced by the number of multi-product
transactions which increased both sequentially and year over year, and
we expect this to accelerate our growth in the second half of the year
and lead to long term sustainable growth in revenue and EPS."
Q2'14 Business Highlights
-
Positioned as a leader in Gartner's 2014 "Magic Quadrant for WAN
Optimization" for the seventh consecutive year.
-
Introduced new features in Riverbed® SteelApp™ Traffic Manager 9.6 and
Riverbed SteelApp Services Controller 1.2 that make cloud applications
and websites more secure and enable faster and easier deployment.
-
Expanded the Riverbed® SteelCentral™ product family,
enhancing the industry's leading performance management suite.
Announced Riverbed SteelCentral AppResponse 9.0 and NetProfiler 10.6
to allow IT teams to share data more easily, identify trends faster
and make performance data more relevant. Introduced a virtual edition
of Riverbed SteelCentral NetExpress 460, which provides visibility
into private cloud or software-defined data center environments
running virtualized networks.
-
Announced Riverbed® SteelFusion™ validation with the EMC VSPEX Proven
Infrastructure, which offers an open integration approach that brings
together best-in-class technologies to create and deliver flexible IT
solutions for customers.
-
Announced Riverbed® SteelHead™ 8.6 to support application acceleration
for the Microsoft Azure cloud and expand optimization and acceleration
of application delivery across 90% of public cloud deployments.
Riverbed also introduced, SteelHead CX 7055v, an enterprise-scale
virtual solution delivering up to 1Gbps of optimized traffic for
private and hybrid clouds.
Q3'14 Outlook
The Company provides the following financial guidance for the third
quarter of fiscal year 2014:
-
Non-GAAP revenues are expected to be in the range of $285 to $291
million
-
Non-GAAP earnings per share is expected to be in the range of $0.30 to
$0.32 per share
Riverbed will host a conference call today, July 24, at 1:30 p.m.
Pacific Time (4:30 p.m. Eastern Time) to discuss its second quarter 2014
results and outlook for the third quarter of 2014. The call will be
broadcast live over the Internet at http://www.riverbed.com/investors
and a replay of the webcast will also be available for 12 months.
Use of Non-GAAP Financial Information
To supplement our financial results presented in accordance with
Generally Accepted Accounting Principles (GAAP), this press release and
the accompanying tables contain certain non-GAAP financial measures,
including non-GAAP revenue, non-GAAP net income and non-GAAP net income
per share, which we believe are helpful in understanding our past
financial performance and future results. For reconciliations of these
non-GAAP financial measures to the most directly comparable GAAP
financial measures, please see the section of the accompanying tables
titled, "GAAP to Non-GAAP Reconciliations." Our non-GAAP financial
measures are not meant to be considered in isolation or as a substitute
for comparable GAAP measures and should be read in conjunction with our
consolidated financial statements prepared in accordance with GAAP. Our
management regularly uses our supplemental non-GAAP financial measures
internally to understand and manage our business and forecast future
periods; as such, we believe it is useful for investors to understand
the effects of these items on our total operating expenses. Our non-GAAP
financial measures include adjustments based on the following items, as
well as the related income tax effects, adjustments related to our tax
valuation allowance and the interim tax cost of the one-time transfer of
intellectual property rights between Riverbed legal entities:
Support and services deferred revenue: Business combination accounting
rules require us to account for the fair value of support and service
contracts assumed in connection with our acquisitions. The book value of
the acquisition deferred support and services revenue related to OPNET
was reduced by $19 million in the adjustment to fair value. Because
these are typically one to five year contracts, our GAAP revenues for
the periods subsequent to the acquisition of a business do not reflect
the full amount of service revenues on assumed support contracts that
would have otherwise been recorded by the acquired entity. The non-GAAP
adjustment is intended to reflect the full amount of such revenues. We
believe this adjustment is useful to investors as a measure of the
ongoing performance of our business because we have historically
experienced high renewal rates on support contracts, although we cannot
be certain that customers will renew these contracts.
Inventory and cost of product revenue: Business combination accounting
rules require us to account for the fair value of inventory acquired in
connection with our acquisitions. The fair value of inventory is
estimated as the selling price minus the estimated cost to sell. In the
period subsequent to the acquisition, the cost of product revenue
includes the higher fair value of the acquired inventory that would not
have otherwise been recorded by the acquired entity.
Stock-based compensation expenses: We have excluded the effect of
stock-based compensation and related payroll tax expenses from our
non-GAAP operating expenses and net income measures. Although
stock-based compensation is a key incentive offered to our employees, we
continue to evaluate our business performance excluding stock-based
compensation expenses. Stock-based compensation expenses will recur in
future periods.
Amortization of intangible assets: We have excluded the effect of
amortization of intangible assets from our non-GAAP net income.
Amortization of intangible assets is a non-cash expense, and it is not
part of our core operations. Investors should note that the use of
intangible assets contributed to revenues earned during the periods
presented and will contribute to future revenues as well.
Acquisition related expenses: We incur significant expenses in
connection with our acquisitions. Acquisition related expenses consist
of transaction costs, costs for transitional employees, other acquired
employee related retention costs, facilities consolidation and exit
costs, integration related professional services, adjustments to the
fair value of the acquisition related contingent consideration, the
write-down of certain acquired in-progress research and development
intangibles, and foreign exchange losses on the acquisition related
contingent consideration.
Other expenses are those which we would not otherwise have incurred in
the periods presented as a part of our ongoing expenses. In this
quarter, Other expenses included:
Operating lease not in service - We entered into an operating lease on a
new corporate headquarters in San Francisco. The lease accounting rules
require that rent expense begin on a straight line basis starting in the
period that we have the right to access the new facility. We gained the
right to access the facility in November 2013 to begin constructing our
leasehold improvements. We occupied the new facility in the second
quarter of 2014. We believe that the duplicate rent of the new facility
during the construction period is not representative of the ongoing
operating costs of the company.
Non-routine corporate governance and shareholder matters - Beginning in
the fourth quarter of 2013, we began incurring professional service fees
related to non-routine corporate governance and shareholder matters. We
believe these fees are not representative of the ongoing operating costs
of the company.
Forward Looking Statements This press release contains
forward-looking statements, including statements relating to revenue and
earnings growth, customer adoption of the full breadth of our
Application Performance Platform, and other forward opportunities. These
forward-looking statements involve risks and uncertainties, as well as
assumptions that, if they do not fully materialize or prove incorrect,
could cause our results to differ materially from those expressed or
implied by such forward-looking statements. The risks and uncertainties
that could cause our results to differ materially from those expressed
or implied by such forward-looking statements include our ability to
react to trends and challenges in our business and the markets in which
we operate; our ability to anticipate market needs or develop new or
enhanced products to meet those needs; customer adoption rate of our
products and our Application Performance Platform; our ability to
establish and maintain successful relationships with our distribution
partners; our ability to compete in our industry; fluctuations in
demand, sales cycles and prices for our products and services; shortages
or price fluctuations in our supply chain; our ability to protect our
intellectual property rights; general political, economic and market
conditions and events; and other risks and uncertainties described more
fully in our documents filed with or furnished to the Securities and
Exchange Commission. More information about these and other risks that
may impact Riverbed's business are set forth in our Form 10-K filed with
the SEC for the period ended December 31, 2013, and our subsequent
quarterly reports filed with the SEC. All forward-looking statements in
this press release are based on information available to us as of the
date hereof, and we assume no obligation to update these forward-looking
statements. Any future product, feature or related specification that
may be referenced in this release are for information purposes only and
are not commitments to deliver any technology or enhancement. Riverbed
reserves the right to modify future product plans at any time.
About Riverbed
Riverbed, at more than $1 billion in annual revenue, is the leader in
Application Performance Infrastructure, delivering the most complete
platform for Location-Independent Computing. Location-Independent
Computing turns location and distance into a competitive advantage by
allowing IT to have the flexibility to host applications and data in the
most optimal locations while ensuring applications perform as expected,
data is always available when needed, and performance issues are
detected and fixed before end users notice. Riverbed's 25,000+ customers
include 97% of both the Fortune 100 and the Forbes Global 100. Learn
more at www.riverbed.com.
Riverbed and any Riverbed product or service name or logo used herein
are trademarks of Riverbed Technology, Inc. All other trademarks used
herein belong to their respective owners.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Riverbed Technology
|
GAAP Condensed Consolidated Statements of Operations
|
In thousands, except per share amounts
|
Unaudited
|
|
|
|
|
|
Three months ended
|
Six months ended
|
|
|
|
|
June 30,
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product
|
|
|
|
$
|
144,914
|
|
|
|
$
|
143,483
|
|
|
|
$
|
295,075
|
|
|
|
$
|
291,523
|
|
Support and services
|
|
|
|
|
119,112
|
|
|
|
|
106,427
|
|
|
|
|
234,367
|
|
|
|
|
204,526
|
|
Total revenue
|
|
|
|
|
264,026
|
|
|
|
|
249,910
|
|
|
|
|
529,442
|
|
|
|
|
496,049
|
|
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product
|
|
|
|
|
36,388
|
|
|
|
|
40,463
|
|
|
|
|
74,669
|
|
|
|
|
81,363
|
|
Cost of support and services
|
|
|
|
|
32,633
|
|
|
|
|
29,893
|
|
|
|
|
64,264
|
|
|
|
|
57,935
|
|
Total cost of revenue
|
|
|
|
|
69,021
|
|
|
|
|
70,356
|
|
|
|
|
138,933
|
|
|
|
|
139,298
|
|
Gross profit
|
|
|
|
|
195,005
|
|
|
|
|
179,554
|
|
|
|
|
390,509
|
|
|
|
|
356,751
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing
|
|
|
|
|
110,690
|
|
|
|
|
113,373
|
|
|
|
|
225,435
|
|
|
|
|
229,094
|
|
Research and development
|
|
|
|
|
51,298
|
|
|
|
|
51,018
|
|
|
|
|
101,945
|
|
|
|
|
99,979
|
|
General and administrative
|
|
|
|
|
20,279
|
|
|
|
|
18,321
|
|
|
|
|
39,404
|
|
|
|
|
37,435
|
|
Acquisition-related costs
|
|
|
|
|
272
|
|
|
|
|
7,067
|
|
|
|
|
2,940
|
|
|
|
|
11,203
|
|
Total operating expenses
|
|
|
|
|
182,539
|
|
|
|
|
189,779
|
|
|
|
|
369,724
|
|
|
|
|
377,711
|
|
Operating profit (loss)
|
|
|
|
|
12,466
|
|
|
|
|
(10,225
|
)
|
|
|
|
20,785
|
|
|
|
|
(20,960
|
)
|
Interest expense and other, net
|
|
|
|
|
(2,713
|
)
|
|
|
|
(5,909
|
)
|
|
|
|
(5,426
|
)
|
|
|
|
(12,273
|
)
|
Income (loss) before provision for income taxes
|
|
|
|
|
9,753
|
|
|
|
|
(16,134
|
)
|
|
|
|
15,359
|
|
|
|
|
(33,233
|
)
|
Provision for (benefit from) income taxes
|
|
|
|
|
2,988
|
|
|
|
|
387
|
|
|
|
$
|
5,306
|
|
|
|
|
(8,602
|
)
|
Net income (loss)
|
|
|
|
$
|
6,765
|
|
|
|
$
|
(16,521
|
)
|
|
|
$
|
10,053
|
|
|
|
$
|
(24,631
|
)
|
Net income (loss) per share, basic
|
|
|
|
$
|
0.04
|
|
|
|
$
|
(0.10
|
)
|
|
|
$
|
0.06
|
|
|
|
$
|
(0.15
|
)
|
Net income (loss) per share, diluted
|
|
|
|
$
|
0.04
|
|
|
|
$
|
(0.10
|
)
|
|
|
$
|
0.06
|
|
|
|
$
|
(0.15
|
)
|
Shares used in computing basic net income (loss) per share
|
|
|
160,580
|
|
|
|
|
163,995
|
|
|
|
|
160,385
|
|
|
|
|
163,681
|
|
Shares used in computing diluted net income (loss) per share
|
|
|
164,650
|
|
|
|
|
163,995
|
|
|
|
|
164,982
|
|
|
|
|
163,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Riverbed Technology
|
Condensed Consolidated Balance Sheets
|
In thousands
|
Unaudited
|
|
|
|
|
June 30,
|
|
|
December 31,
|
|
|
|
|
2014
|
|
|
2013
|
ASSETS
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
217,611
|
|
|
$
|
208,022
|
Short-term investments
|
|
|
|
|
207,162
|
|
|
|
251,339
|
Trade receivables, net
|
|
|
|
|
108,560
|
|
|
|
93,836
|
Inventory
|
|
|
|
|
17,504
|
|
|
|
25,025
|
Deferred tax assets
|
|
|
|
|
17,255
|
|
|
|
7,222
|
Prepaid expenses and other current assets
|
|
|
|
|
62,905
|
|
|
|
49,016
|
Total current assets
|
|
|
|
|
630,997
|
|
|
|
634,460
|
Long-term investments
|
|
|
|
|
95,092
|
|
|
|
72,675
|
Fixed assets, net
|
|
|
|
|
75,953
|
|
|
|
57,810
|
Goodwill
|
|
|
|
|
704,305
|
|
|
|
704,305
|
Intangible assets, net
|
|
|
|
|
361,129
|
|
|
|
404,467
|
Deferred tax assets, non-current
|
|
|
|
|
-
|
|
|
|
74
|
Other assets
|
|
|
|
|
21,435
|
|
|
|
23,807
|
Total assets
|
|
|
|
$
|
1,888,911
|
|
|
$
|
1,897,598
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
$
|
41,390
|
|
|
$
|
45,518
|
Accrued compensation and related benefits
|
|
|
|
|
40,816
|
|
|
|
51,988
|
Other accrued liabilities
|
|
|
|
|
52,639
|
|
|
|
36,520
|
Current maturities of long-term borrowings
|
|
|
|
|
15,000
|
|
|
|
15,000
|
Deferred revenue
|
|
|
|
|
231,142
|
|
|
|
217,131
|
Total current liabilities
|
|
|
|
|
380,987
|
|
|
|
366,157
|
Deferred revenue, non-current
|
|
|
|
|
87,863
|
|
|
|
95,344
|
Borrowings, non-current, net of current maturities
|
|
|
|
|
502,500
|
|
|
|
510,000
|
Deferred tax liability, non-current
|
|
|
|
|
42,789
|
|
|
|
48,548
|
Other long-term liabilities
|
|
|
|
|
50,993
|
|
|
|
48,910
|
Total long-term liabilities
|
|
|
|
|
684,145
|
|
|
|
702,802
|
Stockholders' equity:
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
|
688,133
|
|
|
|
702,928
|
Retained earnings
|
|
|
|
|
135,348
|
|
|
|
125,295
|
Accumulated other comprehensive income
|
|
|
|
|
298
|
|
|
|
416
|
Total stockholders' equity
|
|
|
|
|
823,779
|
|
|
|
828,639
|
Total liabilities and stockholders' equity
|
|
|
|
$
|
1,888,911
|
|
|
$
|
1,897,598
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Riverbed Technology
|
Condensed Consolidated Statements of Cash Flows
|
In thousands
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
Operating activities:
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
|
$
|
10,053
|
|
|
|
$
|
(24,631
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
57,047
|
|
|
|
|
62,780
|
|
Stock-based compensation
|
|
|
|
|
43,321
|
|
|
|
|
50,055
|
|
Deferred taxes
|
|
|
|
|
(15,715
|
)
|
|
|
|
(32,867
|
)
|
Excess tax benefit from employee stock plans
|
|
|
|
|
(5,245
|
)
|
|
|
|
(4,683
|
)
|
Other non-cash items
|
|
|
|
|
454
|
|
|
|
|
1,213
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
Trade receivables
|
|
|
|
|
(14,724
|
)
|
|
|
|
19,915
|
|
Inventory
|
|
|
|
|
7,521
|
|
|
|
|
(3,690
|
)
|
Prepaid expenses and other assets
|
|
|
|
|
(11,008
|
)
|
|
|
|
(6,136
|
)
|
Accounts payable
|
|
|
|
|
(4,771
|
)
|
|
|
|
(8,282
|
)
|
Accruals and other liabilities
|
|
|
|
|
7,029
|
|
|
|
|
(11,384
|
)
|
Income taxes payable
|
|
|
|
|
1,602
|
|
|
|
|
(1,974
|
)
|
Deferred revenue
|
|
|
|
|
6,530
|
|
|
|
|
40,257
|
|
Net cash provided by operating activities
|
|
|
|
|
82,094
|
|
|
|
|
80,573
|
|
Investing activities:
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
|
(31,208
|
)
|
|
|
|
(12,627
|
)
|
Purchase of available for sale securities
|
|
|
|
|
(170,606
|
)
|
|
|
|
(229,009
|
)
|
Proceeds from maturities of available for sale securities
|
|
|
|
|
166,314
|
|
|
|
|
161,250
|
|
Proceeds from sales of available for sale securities
|
|
|
|
|
25,145
|
|
|
|
|
15,045
|
|
Acquisitions, net of cash acquired
|
|
|
|
|
-
|
|
|
|
|
(1,000
|
)
|
Net cash used in investing activities
|
|
|
|
|
(10,355
|
)
|
|
|
|
(66,341
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock under employee stock plans
|
|
|
|
|
48,491
|
|
|
|
|
49,813
|
|
Cash used related to net shares settlement of equity awards
|
|
|
|
|
(8,171
|
)
|
|
|
|
(4,289
|
)
|
Payments for repurchases of common stock
|
|
|
|
|
(100,038
|
)
|
|
|
|
(75,078
|
)
|
Payment of borrowings
|
|
|
|
|
(7,500
|
)
|
|
|
|
(50,015
|
)
|
Excess tax benefit from employee stock plans
|
|
|
|
|
5,245
|
|
|
|
|
4,683
|
|
Net cash used in financing activities
|
|
|
|
|
(61,973
|
)
|
|
|
|
(74,886
|
)
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
|
|
(177
|
)
|
|
|
|
(1,192
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
|
9,589
|
|
|
|
|
(61,846
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
|
|
208,022
|
|
|
|
|
280,509
|
|
Cash and cash equivalents at end of period
|
|
|
|
$
|
217,611
|
|
|
|
$
|
218,663
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Riverbed Technology
|
Supplemental Financial Information
|
In thousands
|
Unaudited
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
March 31,
|
|
|
June 30,
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
2014
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
Revenue by Geography
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
|
|
$
|
154,744
|
|
|
|
$
|
160,818
|
|
|
|
$
|
156,850
|
|
|
|
$
|
315,562
|
|
|
|
$
|
314,992
|
|
Europe, Middle East and Africa
|
|
|
|
|
69,421
|
|
|
|
|
69,030
|
|
|
|
|
59,397
|
|
|
|
|
138,451
|
|
|
|
|
117,231
|
|
Asia Pacific
|
|
|
|
|
39,861
|
|
|
|
|
35,568
|
|
|
|
|
33,663
|
|
|
|
|
75,429
|
|
|
|
|
63,826
|
|
Total revenue
|
|
|
|
$
|
264,026
|
|
|
|
$
|
265,416
|
|
|
|
$
|
249,910
|
|
|
|
$
|
529,442
|
|
|
|
$
|
496,049
|
|
As a percentage of total revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
|
|
|
59
|
%
|
|
|
|
61
|
%
|
|
|
|
63
|
%
|
|
|
|
60
|
%
|
|
|
|
63
|
%
|
Europe, Middle East and Africa
|
|
|
|
|
26
|
%
|
|
|
|
26
|
%
|
|
|
|
24
|
%
|
|
|
|
26
|
%
|
|
|
|
24
|
%
|
Asia Pacific
|
|
|
|
|
15
|
%
|
|
|
|
13
|
%
|
|
|
|
13
|
%
|
|
|
|
14
|
%
|
|
|
|
13
|
%
|
Total revenue
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
Revenue by Sales Channel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
|
|
|
|
$
|
22,519
|
|
|
|
$
|
31,400
|
|
|
|
$
|
42,988
|
|
|
|
$
|
53,918
|
|
|
|
$
|
91,957
|
|
Indirect
|
|
|
|
|
241,507
|
|
|
|
|
234,016
|
|
|
|
|
206,922
|
|
|
|
|
475,524
|
|
|
|
|
404,092
|
|
Total revenue
|
|
|
|
$
|
264,026
|
|
|
|
$
|
265,416
|
|
|
|
$
|
249,910
|
|
|
|
$
|
529,442
|
|
|
|
$
|
496,049
|
|
As a percentage of total revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
|
|
|
|
|
9
|
%
|
|
|
|
12
|
%
|
|
|
|
17
|
%
|
|
|
|
10
|
%
|
|
|
|
19
|
%
|
Indirect
|
|
|
|
|
91
|
%
|
|
|
|
88
|
%
|
|
|
|
83
|
%
|
|
|
|
90
|
%
|
|
|
|
81
|
%
|
Total revenue
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Riverbed Technology
|
GAAP to Non-GAAP Reconciliation
|
In thousands, except per share amounts
|
Unaudited
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
March 31,
|
|
|
June 30,
|
|
|
June 30,
|
|
|
June 30,
|
GAAP to Non-GAAP Reconciliations:
|
|
|
|
2014
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
Reconciliation of Total revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP as reported
|
|
|
|
$
|
264,026
|
|
|
|
$
|
265,416
|
|
|
|
$
|
249,910
|
|
|
|
$
|
529,442
|
|
|
|
$
|
496,049
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred revenue adjustment (6)
|
|
|
|
|
374
|
|
|
|
|
509
|
|
|
|
|
4,842
|
|
|
|
|
883
|
|
|
|
|
11,321
|
|
As adjusted
|
|
|
|
$
|
264,400
|
|
|
|
$
|
265,925
|
|
|
|
$
|
254,752
|
|
|
|
$
|
530,325
|
|
|
|
$
|
507,370
|
|
Reconciliation of Net income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP as reported
|
|
|
|
$
|
6,765
|
|
|
|
$
|
3,288
|
|
|
|
$
|
(16,521
|
)
|
|
|
$
|
10,053
|
|
|
|
$
|
(24,631
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1)
|
|
|
|
|
21,572
|
|
|
|
|
21,749
|
|
|
|
|
25,529
|
|
|
|
|
43,321
|
|
|
|
|
50,055
|
|
Payroll tax on stock-based compensation (2)
|
|
|
|
|
1,196
|
|
|
|
|
298
|
|
|
|
|
1,076
|
|
|
|
|
1,494
|
|
|
|
|
1,469
|
|
Amortization of intangibles (3)
|
|
|
|
|
21,328
|
|
|
|
|
22,010
|
|
|
|
|
25,818
|
|
|
|
|
43,338
|
|
|
|
|
52,128
|
|
Acquisition-related costs (5)
|
|
|
|
|
292
|
|
|
|
|
2,730
|
|
|
|
|
7,751
|
|
|
|
|
3,022
|
|
|
|
|
12,315
|
|
Inventory fair value adjustment (4)
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
191
|
|
|
|
|
-
|
|
|
|
|
1,700
|
|
Deferred revenue adjustment (6)
|
|
|
|
|
374
|
|
|
|
|
509
|
|
|
|
|
4,842
|
|
|
|
|
883
|
|
|
|
|
11,321
|
|
Other expense (7)
|
|
|
|
|
3,065
|
|
|
|
|
2,396
|
|
|
|
|
-
|
|
|
|
|
5,461
|
|
|
|
|
-
|
|
Income tax adjustments (8)
|
|
|
|
|
(11,983
|
)
|
|
|
|
(12,574
|
)
|
|
|
|
(12,127
|
)
|
|
|
|
(24,557
|
)
|
|
|
|
(29,141
|
)
|
As adjusted
|
|
|
|
$
|
42,609
|
|
|
|
$
|
40,406
|
|
|
|
$
|
36,559
|
|
|
|
$
|
83,015
|
|
|
|
$
|
75,216
|
|
Reconciliation of Net income (loss) per share, diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP as reported
|
|
|
|
$
|
0.04
|
|
|
|
$
|
0.02
|
|
|
|
$
|
(0.10
|
)
|
|
|
$
|
0.06
|
|
|
|
$
|
(0.15
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1)
|
|
|
|
|
0.13
|
|
|
|
|
0.13
|
|
|
|
|
0.15
|
|
|
|
|
0.26
|
|
|
|
|
0.30
|
|
Payroll tax on stock-based compensation (2)
|
|
|
|
|
0.01
|
|
|
|
|
-
|
|
|
|
|
0.01
|
|
|
|
|
0.01
|
|
|
|
|
0.01
|
|
Amortization of intangibles (3)
|
|
|
|
|
0.13
|
|
|
|
|
0.14
|
|
|
|
|
0.15
|
|
|
|
|
0.26
|
|
|
|
|
0.31
|
|
Acquisition-related costs (credits) (5)
|
|
|
|
|
-
|
|
|
|
|
0.02
|
|
|
|
|
0.05
|
|
|
|
|
0.02
|
|
|
|
|
0.07
|
|
Inventory fair value adjustment (4)
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
0.01
|
|
Deferred revenue adjustment (6)
|
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
|
0.03
|
|
|
|
|
0.01
|
|
|
|
|
0.07
|
|
Other expense (7)
|
|
|
|
|
0.02
|
|
|
|
|
0.01
|
|
|
|
|
-
|
|
|
|
|
0.03
|
|
|
|
|
-
|
|
Income tax adjustments (8)
|
|
|
|
|
(0.07
|
)
|
|
|
|
(0.08
|
)
|
|
|
|
(0.07
|
)
|
|
|
|
(0.15
|
)
|
|
|
|
(0.17
|
)
|
As adjusted
|
|
|
|
$
|
0.26
|
|
|
|
$
|
0.24
|
|
|
|
$
|
0.22
|
|
|
|
$
|
0.50
|
|
|
|
$
|
0.45
|
|
Non-GAAP Net income per share, basic
|
|
|
|
$
|
0.27
|
|
|
|
$
|
0.25
|
|
|
|
$
|
0.22
|
|
|
|
$
|
0.52
|
|
|
|
$
|
0.46
|
|
Non-GAAP Net income per share, diluted
|
|
|
|
$
|
0.26
|
|
|
|
$
|
0.24
|
|
|
|
$
|
0.22
|
|
|
|
$
|
0.50
|
|
|
|
$
|
0.45
|
|
Shares used in computing basic net income per share
|
|
|
|
|
160,580
|
|
|
|
|
160,190
|
|
|
|
|
163,995
|
|
|
|
|
160,385
|
|
|
|
|
163,681
|
|
Shares used in computing diluted net income per share
|
|
|
|
|
164,650
|
|
|
|
|
165,313
|
|
|
|
|
168,126
|
|
|
|
|
164,982
|
|
|
|
|
168,770
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product revenue
|
|
|
|
$
|
24
|
|
|
|
$
|
33
|
|
|
|
$
|
-
|
|
|
|
$
|
57
|
|
|
|
$
|
-
|
|
Support and services revenue
|
|
|
|
|
350
|
|
|
|
|
476
|
|
|
|
|
4,842
|
|
|
|
|
826
|
|
|
|
|
11,321
|
|
Cost of product
|
|
|
|
|
11,021
|
|
|
|
|
11,437
|
|
|
|
|
12,413
|
|
|
|
|
22,458
|
|
|
|
|
26,025
|
|
Cost of support and services
|
|
|
|
|
2,488
|
|
|
|
|
2,366
|
|
|
|
|
2,506
|
|
|
|
|
4,854
|
|
|
|
|
4,367
|
|
Sales and marketing
|
|
|
|
|
19,478
|
|
|
|
|
21,269
|
|
|
|
|
24,821
|
|
|
|
|
40,747
|
|
|
|
|
50,300
|
|
Research and development
|
|
|
|
|
7,856
|
|
|
|
|
7,682
|
|
|
|
|
9,668
|
|
|
|
|
15,538
|
|
|
|
|
17,406
|
|
General and administrative
|
|
|
|
|
6,338
|
|
|
|
|
3,761
|
|
|
|
|
3,890
|
|
|
|
|
10,099
|
|
|
|
|
8,366
|
|
Acquisition-related costs
|
|
|
|
|
272
|
|
|
|
|
2,668
|
|
|
|
|
7,067
|
|
|
|
|
2,940
|
|
|
|
|
11,203
|
|
Provision for income taxes
|
|
|
|
|
(11,983
|
)
|
|
|
|
(12,574
|
)
|
|
|
|
(12,127
|
)
|
|
|
|
(24,557
|
)
|
|
|
|
(29,141
|
)
|
Total Non-GAAP adjustments
|
|
|
|
$
|
35,844
|
|
|
|
$
|
37,118
|
|
|
|
$
|
53,080
|
|
|
|
$
|
72,962
|
|
|
|
$
|
99,847
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_____________
(1) Stock-based compensation expense is calculated in
accordance with the fair value recognition provisions of Financial
Accounting Standards Board Accounting Standards Codification (ASC)
Topic 718, Compensation - Stock Compensation effective
January 1, 2006.
(2) Payroll tax on stock-based compensation represents the
incremental cost for employer payroll taxes on stock option
exercises and restricted stock units vested and released.
(3) The intangible assets recorded at fair value as a
result of our acquisitions are amortized over the estimated useful
life of the respective asset.
(4) The inventory fair value adjustment recorded pursuant
to our acquisitions is excluded from our non-GAAP operating
expenses as this cost would not have otherwise occurred in the
period presented.
(5) We incurred expenses in connection with our
acquisitions, which would not have otherwise occurred in the
period presented as part of our operating expenses; therefore,
these costs, including transaction costs, integration costs,
employee retention and severance costs, restructuring costs,
write-down of certain acquired in-process research and development
intangibles, and revaluation of the fair value of contingent
consideration, are excluded from our non-GAAP operating expenses.
(6) Business combination accounting rules require us to
account for the fair value of deferred revenue assumed in
connection with an acquisition. The non-GAAP adjustment is
intended to reflect the full amount of support and service revenue
that would have otherwise been recorded by the acquired entity.
(7) Other expense, net, includes expenses associated with
non-routine corporate governance and shareholder matters and rent
expense related to the new corporate headquarters, which is the
amount of straight-line rent expense incurred from the date we
gained the right to access to the facility for construction
purposes prior to the date of occupancy in May 2014.
(8) The non-GAAP tax rate excludes the income tax effects
of non-GAAP adjustments. Additionally, the non-GAAP tax rate
includes adjustments to our tax valuation allowance on deferred
tax assets and excludes the interim tax cost of the one-time
transfer of intellectual property rights between our legal
entities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[ Back To TMCnet.com's Homepage ]
|