[August 25, 2016] |
|
Splunk Inc. Announces Fiscal Second Quarter 2017 Financial Results
Splunk
Inc. (NASDAQ:SPLK), provider of the leading software platform for
real-time Operational Intelligence, today announced results for its
fiscal second quarter ended July 31, 2016.
Second Quarter 2017 Financial Highlights
-
Total revenues were $212.8 million, up 43% year-over-year.
-
License revenues were $115.7 million, up 32% year-over-year.
-
GAAP operating loss was $83.6 million; GAAP operating margin was
negative 39.3%.
-
Non-GAAP operating income was $8.2 million; non-GAAP operating margin
was 3.9%.
-
GAAP loss per share was $0.65; non-GAAP earnings per share was $0.05.
-
Operating cash flow was $18.3 million with free cash flow of $7.8
million.
"We had a solid Q2 and our success continues to come from a combination
of our existing customers expanding across multiple use cases and from
adding more than 500 new customers," said Doug Merritt, President and
CEO. "We were pleased to see strength across each of our core markets,
the continued adoption of the Splunk platform and increased cloud
momentum."
Second Quarter 2017 and Recent Business
Highlights:
Customers:
-
Signed more than 500 new enterprise customers.
-
New and Expansion Customers Include: City of Los Angeles,
Clearbridge Investments, Cox Automotive, Dubai Airport (United Arab
Emirates), Fruit of the Loom, Hong Kong Jockey Club, Hulu, National
Health Service (UK), Orion Health (New Zealand), Penn State Hershey
Medical Center, Priceline.com, Qualys, Queensland Department of
Education and Training (Australia), SAP SuccessFactors, Subway, State
of New York, Texas Roadhouse, Uber and Yelp.
Products:
-
Announced the availability of the Splunk
App for AWS 4.2, which allows Splunk Enterprise and Splunk Cloud
customers to manage multiple Amazon Web Services accounts and regions
seamlessly through a single pane of glass.
-
Announced that Amazon
EC2 Container Service (ECS) added the Splunk native logging driver
to the newest version of the ECS agent, making it easier to implement
a comprehensive monitoring solution for running containers at scale.
Strategic and Channel Partners:
-
Accenture
introduced a new breach prevention offering that integrates Splunk
Enterprise and Splunk Enterprise Security (ES) with Palo Alto Networks
and Tanium through the Accenture Cyber Defense Platform. The solution
helps organizations improve security across networks and endpoint
devices.
-
Participated in Cisco
Live 2016 to showcase how Splunk and Cisco deliver unified
visibility into application and network performance, dramatically
reduce troubleshooting times, enable better and faster response to
security incidents and more.
-
Participated in DockerCon16
to demonstrate how to monitor, analyze and troubleshoot Docker
environments using Splunk.
Recognition:
Events:
-
Announced that Schmidt Peterson Motorsports (SPM) test
drove a data-driven strategy with Splunk during the 100th running
of the Indianapolis 500. Splunk, SPM and Splunk partner Kinney Group
collaborated to analyze real-time operational data for all three SPM
race cars.
-
The Splunk
Women in Technology group hosted its first international event in
Vancouver, providing the opportunity for technology professionals and
students to hear from Splunk experts on Splunk and machine learning.
-
Hosted SplunkLive! events in cities around the world, including
Calgary, Boston, Salt Lake City, Vienna, London, Zurich and Seattle.
Presentations can be found on the SplunkLive!
website.
Financial Outlook
The company is providing the following guidance for its fiscal third
quarter 2017 (ending October 31, 2016):
-
Total revenues are expected to be between $228 million and $230
million.
-
Non-GAAP operating margin is expected to be between 5% and 6%.
The company is updating its previous guidance for its fiscal year 2017
(ending January 31, 2017):
-
Total revenues are expected to be between $910 and $914 million (was
between $892 and $896 million per prior guidance provided on May 26,
2016).
-
Non-GAAP operating margin is expected to be approximately 5%
(unchanged from prior guidance provided on May 26, 2016).
All forward-looking non-GAAP financial measures contained in this
section "Financial Outlook" exclude estimates for stock-based
compensation expenses, employer payroll tax expense related to employee
stock plans, amortization of acquired intangible assets,
acquisition-related costs and adjustments related to a financing lease
obligation.
A reconciliation of non-GAAP guidance measures to corresponding GAAP
measures is not available on a forward-looking basis without
unreasonable effort due to the uncertainty regarding, and the potential
variability of, many of these costs and expenses that may be incurred in
the future. For example, stock-based compensation expense is impacted by
a number of factors, such as Splunk's future hiring and retention, as
well as the future fair market value of Splunk's common stock, all of
which are difficult to predict and subject to constant change. The
company has provided a reconciliation of GAAP to non-GAAP financial
measures in the financial statement tables for its fiscal second quarter
2017 non-GAAP results included in this press release. The exclusion of
these costs and expenses will have a significant impact on Splunk's
non-GAAP operating margin.
Conference Call and Webcast
Splunk's executive management team will host a conference call today
beginning at 1:30 p.m. PT (4:30 p.m. ET) to discuss the company's
financial results and business highlights. Interested parties may access
the call by dialing (866) 501-1535. International parties may access the
call by dialing (216) 672-5582. A live audio webcast of the conference
call will be available through Splunk's Investor Relations website at http://investors.splunk.com/events.cfm.
A replay of the call will be available through September 1, 2016 by
dialing (855) 859-2056 and referencing Conference ID: 52440447.
Safe Harbor Statement
This press release contains forward-looking statements that involve
risks and uncertainties, including statements regarding Splunk's revenue
and non-GAAP operating margin targets for the company's fiscal third
quarter and fiscal year 2017 in the paragraphs under "Financial Outlook"
above and other statements regarding customer demand and penetration,
strength of various sales geographies, strength of Splunk's market
groups and related customer use cases, the rate of customer adoption and
Splunk's cloud offerings. There are a significant number of factors that
could cause actual results to differ materially from statements made in
this press release, including: Splunk's limited operating history and
experience developing and introducing new products, including its cloud
offerings; risks associated with Splunk's rapid growth, Splunk's limited
experience with respect to predicting future customer demand and
customer acceptance of the company's products and services, in and
outside of the United States; Splunk's ability to rapidly and
successfully integrate new employees into its workforce, particularly
sales personnel; Splunk's inability to realize value from its
significant investments in its business, including product and service
innovations; Splunk's transition to a multi-product software and
services business; Splunk's inability to successfully integrate acquired
businesses and technologies; and general market, political, economic and
business conditions.
Additional information on potential factors that could affect Splunk's
financial results is included in the company's Quarterly Report on Form
10-Q for the quarter ended April 30, 2016, which is on file with the
U.S. Securities and Exchange Commission. Splunk does not assume any
obligation to update the forward-looking statements provided to reflect
events that occur or circumstances that exist after the date on which
they were made.
About Splunk Inc.
Splunk Inc. (NASDAQ: SPLK) is the market-leading platform that powers
Operational Intelligence. We pioneer innovative, disruptive solutions
that make machine data accessible, usable and valuable to everyone. More
than 12,000 customers in over 110 countries use Splunk software and
cloud services to make business, government and education more
efficient, secure and profitable. Join hundreds of thousands of
passionate users by trying Splunk solutions for free: http://www.splunk.com/free-trials.
Social Media: Twitter
| LinkedIn
| YouTube
| Facebook
Splunk, Splunk>, Listen to Your Data, The Engine for Machine Data,
Hunk, Splunk Cloud, Splunk Light, SPL and Splunk MINT are trademarks and
registered trademarks of Splunk Inc. in the United States and other
countries. All other brand names, product names, or trademarks belong to
their respective owners. © 2016 Splunk Inc. All rights reserved.
|
SPLUNK INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues
|
|
|
|
|
|
|
|
|
License
|
|
$
|
115,695
|
|
|
$
|
87,960
|
|
|
$
|
216,687
|
|
|
$
|
159,832
|
|
Maintenance and services
|
|
|
97,058
|
|
|
|
60,366
|
|
|
|
182,018
|
|
|
|
114,159
|
|
Total revenues
|
|
|
212,753
|
|
|
|
148,326
|
|
|
|
398,705
|
|
|
|
273,991
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
|
|
|
|
|
|
|
License
|
|
|
2,868
|
|
|
|
1,813
|
|
|
|
5,830
|
|
|
|
2,974
|
|
Maintenance and services
|
|
|
41,748
|
|
|
|
23,227
|
|
|
|
78,286
|
|
|
|
45,151
|
|
Total cost of revenues
|
|
|
44,616
|
|
|
|
25,040
|
|
|
|
84,116
|
|
|
|
48,125
|
|
Gross profit
|
|
|
168,137
|
|
|
|
123,286
|
|
|
|
314,589
|
|
|
|
225,866
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
67,224
|
|
|
|
48,308
|
|
|
|
134,595
|
|
|
|
93,006
|
|
Sales and marketing
|
|
|
150,228
|
|
|
|
111,786
|
|
|
|
295,379
|
|
|
|
213,775
|
|
General and administrative
|
|
|
34,312
|
|
|
|
28,760
|
|
|
|
66,385
|
|
|
|
55,632
|
|
Total operating expenses
|
|
|
251,764
|
|
|
|
188,854
|
|
|
|
496,359
|
|
|
|
362,413
|
|
Operating loss
|
|
|
(83,627
|
)
|
|
|
(65,568
|
)
|
|
|
(181,770
|
)
|
|
|
(136,547
|
)
|
|
|
|
|
|
|
|
|
|
Interest and other income (expense), net
|
|
|
|
|
|
|
|
Interest income (expense), net
|
|
|
(797
|
)
|
|
|
425
|
|
|
|
(1,200
|
)
|
|
|
785
|
|
Other income (expense), net
|
|
|
(1,063
|
)
|
|
|
(295
|
)
|
|
|
(2,188
|
)
|
|
|
(206
|
)
|
Total interest and other income (expense), net
|
|
|
(1,860
|
)
|
|
|
130
|
|
|
|
(3,388
|
)
|
|
|
579
|
|
Loss before income taxes
|
|
|
(85,487
|
)
|
|
|
(65,438
|
)
|
|
|
(185,158
|
)
|
|
|
(135,968
|
)
|
Income tax provision (benefit)
|
|
|
1,110
|
|
|
|
(10,149
|
)
|
|
|
2,335
|
|
|
|
(9,493
|
)
|
Net loss
|
|
$
|
(86,597
|
)
|
|
$
|
(55,289
|
)
|
|
$
|
(187,493
|
)
|
|
$
|
(126,475
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per share
|
|
$
|
(0.65
|
)
|
|
$
|
(0.44
|
)
|
|
$
|
(1.42
|
)
|
|
$
|
(1.01
|
)
|
|
|
|
|
|
|
|
|
|
Weighted-average shares used in computing basic and diluted net
loss per share
|
|
|
133,041
|
|
|
|
126,621
|
|
|
|
132,310
|
|
|
|
125,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SPLUNK INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In thousands)
|
(Unaudited)
|
|
|
|
July 31,
|
|
January 31,
|
|
|
2016
|
|
2016
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
409,949
|
|
|
$
|
424,541
|
|
Investments, current portion
|
|
|
610,660
|
|
|
|
584,498
|
|
Accounts receivable, net
|
|
|
131,262
|
|
|
|
181,665
|
|
Prepaid expenses and other current assets
|
|
|
26,882
|
|
|
|
26,565
|
|
Total current assets
|
|
|
1,178,753
|
|
|
|
1,217,269
|
|
|
|
|
|
|
Investments, non-current
|
|
|
5,000
|
|
|
|
1,500
|
|
Property and equipment, net
|
|
|
151,953
|
|
|
|
134,995
|
|
Intangible assets, net
|
|
|
43,410
|
|
|
|
49,482
|
|
Goodwill
|
|
|
124,642
|
|
|
|
123,318
|
|
Other assets
|
|
|
13,833
|
|
|
|
10,275
|
|
Total assets
|
|
$
|
1,517,591
|
|
|
$
|
1,536,839
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
Accounts payable
|
|
$
|
5,429
|
|
|
$
|
4,868
|
|
Accrued payroll and compensation
|
|
|
64,913
|
|
|
|
95,898
|
|
Accrued expenses and other liabilities
|
|
|
60,273
|
|
|
|
49,879
|
|
Deferred revenue, current portion
|
|
|
367,834
|
|
|
|
347,121
|
|
Total current liabilities
|
|
|
498,449
|
|
|
|
497,766
|
|
|
|
|
|
|
Deferred revenue, non-current
|
|
|
99,525
|
|
|
|
102,382
|
|
Other liabilities, non-current
|
|
|
90,476
|
|
|
|
77,277
|
|
Total non-current liabilities
|
|
|
190,001
|
|
|
|
179,659
|
|
Total liabilities
|
|
|
688,450
|
|
|
|
677,425
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
|
|
Common stock
|
|
|
134
|
|
|
|
132
|
|
Accumulated other comprehensive loss
|
|
|
(1,774
|
)
|
|
|
(3,770
|
)
|
Additional paid-in capital
|
|
|
1,683,869
|
|
|
|
1,528,647
|
|
Accumulated deficit
|
|
|
(853,088
|
)
|
|
|
(665,595
|
)
|
Total stockholders' equity
|
|
|
829,141
|
|
|
|
859,414
|
|
Total liabilities and stockholders' equity
|
|
$
|
1,517,591
|
|
|
$
|
1,536,839
|
|
|
|
|
|
|
|
|
|
|
SPLUNK INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
(Unaudited)
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Cash Flows From Operating Activities
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(86,597
|
)
|
|
$
|
(55,289
|
)
|
|
$
|
(187,493
|
)
|
|
$
|
(126,475
|
)
|
Adjustments to reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
8,174
|
|
|
|
4,310
|
|
|
|
14,635
|
|
|
|
7,776
|
|
Amortization of investment premiums
|
|
|
189
|
|
|
|
361
|
|
|
|
447
|
|
|
|
722
|
|
Stock-based compensation
|
|
|
88,863
|
|
|
|
63,609
|
|
|
|
180,233
|
|
|
|
129,718
|
|
Deferred income taxes
|
|
|
(192
|
)
|
|
|
(10,986
|
)
|
|
|
(698
|
)
|
|
|
(11,305
|
)
|
Excess tax benefits from employee stock plans
|
|
|
(335
|
)
|
|
|
(186
|
)
|
|
|
(1,027
|
)
|
|
|
(652
|
)
|
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
(32,655
|
)
|
|
|
(18,353
|
)
|
|
|
50,403
|
|
|
|
28,719
|
|
Prepaid expenses, other current and non-current assets
|
|
|
4,942
|
|
|
|
12,795
|
|
|
|
(3,177
|
)
|
|
|
12,468
|
|
Accounts payable
|
|
|
166
|
|
|
|
(502
|
)
|
|
|
265
|
|
|
|
(100
|
)
|
Accrued payroll and compensation
|
|
|
2,742
|
|
|
|
9,657
|
|
|
|
(30,985
|
)
|
|
|
(8,698
|
)
|
Accrued expenses and other liabilities
|
|
|
16,470
|
|
|
|
(7,725
|
)
|
|
|
13,579
|
|
|
|
(7,085
|
)
|
Deferred revenue
|
|
|
16,582
|
|
|
|
15,947
|
|
|
|
17,856
|
|
|
|
17,165
|
|
Net cash provided by operating activities
|
|
|
18,349
|
|
|
|
13,638
|
|
|
|
54,038
|
|
|
|
42,253
|
|
|
|
|
|
|
|
|
|
|
Cash Flow From Investing Activities
|
|
|
|
|
|
|
|
|
Purchases of investments
|
|
|
(173,741
|
)
|
|
|
(58,681
|
)
|
|
|
(316,528
|
)
|
|
|
(219,195
|
)
|
Maturities of investments
|
|
|
157,155
|
|
|
|
87,000
|
|
|
|
290,275
|
|
|
|
247,000
|
|
Acquisitions, net of cash acquired
|
|
|
-
|
|
|
|
(142,693
|
)
|
|
|
-
|
|
|
|
(142,693
|
)
|
Purchases of property and equipment
|
|
|
(10,541
|
)
|
|
|
(2,809
|
)
|
|
|
(14,250
|
)
|
|
|
(9,224
|
)
|
Other investment activities
|
|
|
(3,500
|
)
|
|
|
-
|
|
|
|
(3,500
|
)
|
|
|
(1,500
|
)
|
Net cash used in investing activities
|
|
|
(30,627
|
)
|
|
|
(117,183
|
)
|
|
|
(44,003
|
)
|
|
|
(125,612
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flow From Financing Activities
|
|
|
|
|
|
|
|
|
Proceeds from the exercise of stock options
|
|
|
3,939
|
|
|
|
5,370
|
|
|
|
5,603
|
|
|
|
10,736
|
|
Excess tax benefits from employee stock plans
|
|
|
335
|
|
|
|
186
|
|
|
|
1,027
|
|
|
|
652
|
|
Proceeds from employee stock purchase plan
|
|
|
15,183
|
|
|
|
10,906
|
|
|
|
15,183
|
|
|
|
10,906
|
|
Taxes paid related to net share settlement of equity awards
|
|
|
(25,091
|
)
|
|
|
-
|
|
|
|
(46,822
|
)
|
|
|
-
|
|
Net cash provided by (used in) financing activities
|
|
|
(5,634
|
)
|
|
|
16,462
|
|
|
|
(25,009
|
)
|
|
|
22,294
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
(384
|
)
|
|
|
(224
|
)
|
|
|
382
|
|
|
|
(50
|
)
|
Net decrease in cash and cash equivalents
|
|
|
(18,296
|
)
|
|
|
(87,307
|
)
|
|
|
(14,592
|
)
|
|
|
(61,115
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
428,245
|
|
|
|
413,507
|
|
|
|
424,541
|
|
|
|
387,315
|
|
Cash and cash equivalents at end of period
|
|
$
|
409,949
|
|
|
$
|
326,200
|
|
|
$
|
409,949
|
|
|
$
|
326,200
|
|
|
SPLUNK INC. Non-GAAP financial measures and
reconciliations
To supplement Splunk's condensed consolidated financial statements,
which are prepared and presented in accordance with generally accepted
accounting principles in the United States ("GAAP"), Splunk provides
investors with certain non-GAAP financial measures, including non-GAAP
cost of revenues, non-GAAP gross margin, non-GAAP research and
development expense, non-GAAP sales and marketing expense, non-GAAP
general and administrative expense, non-GAAP operating income (loss),
non-GAAP operating margin, non-GAAP net income (loss) and non-GAAP net
income (loss) per share (collectively the "non-GAAP financial
measures"). These non-GAAP financial measures exclude all or a
combination of the following (as reflected in the following
reconciliation tables): stock-based compensation expense, employer
payroll tax expense related to employee stock plans, amortization of
acquired intangible assets, acquisition-related costs, adjustments
related to a financing lease obligation and the partial release of the
valuation allowance due to acquisition. The adjustments for the
financing lease obligation are to reflect the expense we would have
recorded if our build-to-suit lease arrangement had been deemed an
operating lease instead of a financing lease and is calculated as the
net of actual ground lease expense, depreciation and interest expense
over estimated straight-line rent expense. In addition, non-GAAP
financial measures include free cash flow, which represents cash from
operations less purchases of property and equipment. The presentation of
the non-GAAP financial measures is not intended to be considered in
isolation or as a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP. Splunk uses
these non-GAAP financial measures for financial and operational
decision-making purposes and as a means to evaluate period-to-period
comparisons. Splunk believes that these non-GAAP financial measures
provide useful information about Splunk's operating results, enhance the
overall understanding of past financial performance and future prospects
and allow for greater transparency with respect to key metrics used by
management in its financial and operational decision making. In
addition, these non-GAAP financial measures facilitate comparisons to
competitors' operating results.
Splunk excludes stock-based compensation expense because it is non-cash
in nature and excluding this expense provides meaningful supplemental
information regarding Splunk's operational performance. In particular,
because of varying available valuation methodologies, subjective
assumptions and the variety of award types that companies can use under
FASB ASC Topic 718, Splunk believes that providing non-GAAP financial
measures that exclude this expense allows investors the ability to make
more meaningful comparisons between Splunk's operating results and those
of other companies. Splunk excludes employer payroll tax expense related
to employee stock plans in order for investors to see the full effect
that excluding that stock-based compensation expense had on Splunk's
operating results. These expenses are tied to the exercise or vesting of
underlying equity awards and the price of Splunk's common stock at the
time of vesting or exercise, which may vary from period to period
independent of the operating performance of Splunk's business. Splunk
also excludes amortization of acquired intangible assets,
acquisition-related costs, the partial release of the valuation
allowance due to acquisition and makes adjustments related to a
financing lease obligation from its non-GAAP financial measures because
these are considered by management to be outside of Splunk's core
operating results. Accordingly, Splunk believes that excluding these
expenses provides investors and management with greater visibility to
the underlying performance of its business operations, facilitates
comparison of its results with other periods and may also facilitate
comparison with the results of other companies in its industry. Splunk
considers free cash flow to be a liquidity measure that provides useful
information to management and investors about the amount of cash
generated by the business that can be used for strategic opportunities,
including investing in its business, making strategic acquisitions and
strengthening its balance sheet.
There are limitations in using non-GAAP financial measures because the
non-GAAP financial measures are not prepared in accordance with GAAP,
may be different from non-GAAP financial measures used by Splunk's
competitors and exclude expenses that may have a material impact upon
Splunk's reported financial results. Further, stock-based compensation
expense has been and will continue to be for the foreseeable future a
significant recurring expense in Splunk's business and an important part
of the compensation provided to Splunk's employees. The non-GAAP
financial measures are meant to supplement and be viewed in conjunction
with GAAP financial measures.
The following tables reconcile Splunk's non-GAAP results to Splunk's
GAAP results included in this press release.
|
SPLUNK INC.
|
Reconciliation of GAAP to Non-GAAP Financial Measures
|
(In thousands, except per share data)
|
(Unaudited)
|
|
Reconciliation of Cash Provided by
Operating Activities to Free Cash Flow
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
July 31,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Net cash provided by operating activities
|
|
$
|
18,349
|
|
|
$
|
13,638
|
|
|
$
|
54,038
|
|
|
$
|
42,253
|
|
Less purchases of property and equipment
|
|
|
(10,541
|
)
|
|
|
(2,809
|
)
|
|
|
(14,250
|
)
|
|
|
(9,224
|
)
|
Free cash flow (Non-GAAP)
|
|
$
|
7,808
|
|
|
$
|
10,829
|
|
|
$
|
39,788
|
|
|
$
|
33,029
|
|
Net cash used in investing activities
|
|
$
|
(30,627
|
)
|
|
$
|
(117,183
|
)
|
|
$
|
(44,003
|
)
|
|
$
|
(125,612
|
)
|
Net cash provided by (used in) financing activities
|
|
$
|
(5,634
|
)
|
|
$
|
16,462
|
|
|
$
|
(25,009
|
)
|
|
$
|
22,294
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Measures
|
Three Months Ended July 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Employer payroll
|
|
Amortization of
|
|
related to
|
|
|
|
|
|
|
|
|
Stock-based
|
|
tax on employee
|
|
acquired
|
|
financing lease
|
|
|
|
|
|
|
GAAP
|
|
compensation
|
|
stock plans
|
|
intangible assets
|
|
obligation
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
$
|
44,616
|
|
|
$
|
(7,310
|
)
|
|
|
$
|
(208
|
)
|
|
|
$
|
(2,886
|
)
|
|
|
$
|
259
|
|
|
|
$
|
34,471
|
|
|
|
Gross Margin
|
|
|
79.0
|
%
|
|
|
3.4
|
%
|
|
|
|
0.1
|
%
|
|
|
|
1.4
|
%
|
|
|
|
(0.1
|
)%
|
|
|
|
83.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
67,224
|
|
|
|
(27,742
|
)
|
|
|
|
(676
|
)
|
|
|
|
(59
|
)
|
|
|
|
555
|
|
|
|
|
39,302
|
|
|
|
Sales and marketing
|
|
|
150,228
|
|
|
|
(39,371
|
)
|
|
|
|
(791
|
)
|
|
|
|
(151
|
)
|
|
|
|
1,131
|
|
|
|
|
111,046
|
|
|
|
General and administrative
|
|
|
34,312
|
|
|
|
(14,440
|
)
|
|
|
|
(388
|
)
|
|
|
|
-
|
|
|
|
|
251
|
|
|
|
|
19,735
|
|
|
|
Operating income (loss)
|
|
|
(83,627
|
)
|
|
|
88,863
|
|
|
|
|
2,063
|
|
|
|
|
3,096
|
|
|
|
|
(2,196
|
)
|
|
|
|
8,199
|
|
|
|
Operating margin
|
|
|
(39.3
|
)%
|
|
|
41.7
|
%
|
|
|
|
1.0
|
%
|
|
|
|
1.5
|
%
|
|
|
|
(1.0
|
)%
|
|
|
|
3.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(86,597
|
)
|
|
$
|
88,863
|
|
|
|
$
|
2,063
|
|
|
|
$
|
3,096
|
|
|
|
$
|
(147
|
)(2)
|
|
|
|
$
|
7,278
|
|
|
|
Net income (loss) per share(1)
|
|
$
|
(0.65
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.05
|
|
|
|
|
|
(1) GAAP net loss per share calculated based on 133,041
weighted-average shares of common stock. Non-GAAP net income per
share calculated based on 136,430 diluted weighted-average shares
of common stock, which includes 3,389 potentially dilutive shares
related to employee stock awards. GAAP to Non-GAAP net income
(loss) per share is not reconciled due to the difference in the
number of shares used to calculate basic and diluted
weighted-average shares of common stock.
|
(2) Includes $2.0 million of interest expense related to
the financing lease obligation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Measures
|
Three Months Ended July 31, 2015
|
|
|
|
|
|
|
|
Employer payroll
|
|
Amortization of
|
|
|
|
Adjustments related
|
|
|
|
|
|
|
Stock-based
|
|
tax on employee
|
|
acquired
|
|
Acquisition-
|
|
to financing lease
|
|
|
|
|
GAAP
|
|
compensation
|
|
stock plans
|
|
intangible assets
|
|
related costs
|
|
obligation
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
$
|
25,040
|
|
|
$
|
(5,662
|
)
|
|
|
$
|
(398
|
)
|
|
|
$
|
(1,572
|
)
|
|
|
$
|
-
|
|
|
|
$
|
-
|
|
|
$
|
17,408
|
|
Gross Margin
|
|
|
83.1
|
%
|
|
|
3.8
|
%
|
|
|
|
0.3
|
%
|
|
|
|
1.1
|
%
|
|
|
|
-
|
%
|
|
|
|
-
|
%
|
|
|
88.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
48,308
|
|
|
|
(19,301
|
)
|
|
|
|
(732
|
)
|
|
|
|
(79
|
)
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
28,196
|
|
Sales and marketing
|
|
|
111,786
|
|
|
|
(28,210
|
)
|
|
|
|
(985
|
)
|
|
|
|
(155
|
)
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
82,436
|
|
General and administrative
|
|
|
28,760
|
|
|
|
(10,436
|
)
|
|
|
|
(602
|
)
|
|
|
|
-
|
|
|
|
|
(1,993
|
)
|
|
|
|
(222
|
)
|
|
|
15,507
|
|
Operating income (loss)
|
|
|
(65,568
|
)
|
|
|
63,609
|
|
|
|
|
2,717
|
|
|
|
|
1,806
|
|
|
|
|
1,993
|
|
|
|
|
222
|
|
|
|
4,779
|
|
Operating margin
|
|
|
(44.2
|
)%
|
|
|
43.0
|
%
|
|
|
|
1.8
|
%
|
|
|
|
1.2
|
%
|
|
|
|
1.3
|
%
|
|
|
|
0.1
|
%
|
|
|
3.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(55,289
|
)
|
|
$
|
63,609
|
|
|
|
$
|
2,717
|
|
|
|
$
|
1,806
|
|
|
|
$
|
(8,931
|
)(2)
|
|
|
|
$
|
222
|
|
|
$
|
4,134
|
|
Net income (loss) per share(1)
|
|
$
|
(0.44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) GAAP net loss per share calculated based on 126,621
weighted-average shares of common stock. Non-GAAP net income per
share calculated based on 132,001 diluted weighted-average shares
of common stock, which includes 5,380 potentially dilutive shares
related to employee stock awards. GAAP to Non-GAAP net income
(loss) per share is not reconciled due to the difference in the
number of shares used to calculate basic and diluted
weighted-average shares of common stock.
|
(2) Includes $10.9 million related to the partial release
of the valuation allowance due to acquisition.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Measures
|
Six Months Ended July 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Employer payroll
|
|
Amortization of
|
|
related to
|
|
|
|
|
|
|
|
|
Stock-based
|
|
tax on employee
|
|
acquired
|
|
financing lease
|
|
|
|
|
|
|
GAAP
|
|
compensation
|
|
stock plans
|
|
intangible assets
|
|
obligation
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
$
|
84,116
|
|
|
$
|
(14,865
|
)
|
|
|
$
|
(470
|
)
|
|
|
$
|
(5,798
|
)
|
|
|
$
|
285
|
|
|
|
$
|
63,268
|
|
|
|
Gross Margin
|
|
|
78.9
|
%
|
|
|
3.7
|
%
|
|
|
|
0.1
|
%
|
|
|
|
1.5
|
%
|
|
|
|
(0.1
|
)%
|
|
|
|
84.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
134,595
|
|
|
|
(56,948
|
)
|
|
|
|
(1,432
|
)
|
|
|
|
(130
|
)
|
|
|
|
613
|
|
|
|
|
76,698
|
|
|
|
Sales and marketing
|
|
|
295,379
|
|
|
|
(79,604
|
)
|
|
|
|
(1,817
|
)
|
|
|
|
(302
|
)
|
|
|
|
1,249
|
|
|
|
|
214,905
|
|
|
|
General and administrative
|
|
|
66,385
|
|
|
|
(28,816
|
)
|
|
|
|
(829
|
)
|
|
|
|
-
|
|
|
|
|
277
|
|
|
|
|
37,017
|
|
|
|
Operating income (loss)
|
|
|
(181,770
|
)
|
|
|
180,233
|
|
|
|
|
4,548
|
|
|
|
|
6,230
|
|
|
|
|
(2,424
|
)
|
|
|
|
6,817
|
|
|
|
Operating margin
|
|
|
(45.6
|
)%
|
|
|
45.2
|
%
|
|
|
|
1.1
|
%
|
|
|
|
1.6
|
%
|
|
|
|
(0.6
|
)%
|
|
|
|
1.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(187,493
|
)
|
|
$
|
180,233
|
|
|
|
$
|
4,548
|
|
|
|
$
|
6,230
|
|
|
|
$
|
1,117
|
(2)
|
|
|
|
$
|
4,635
|
|
|
|
Net income (loss) per share(1)
|
|
$
|
(1.42
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) GAAP net loss per share calculated based on 132,310
weighted-average shares of common stock. Non-GAAP net income per
share calculated based on 135,348 diluted weighted-average shares
of common stock, which includes 3,038 potentially dilutive shares
related to employee stock awards. GAAP to Non-GAAP net income
(loss) per share is not reconciled due to the difference in the
number of shares used to calculate basic and diluted
weighted-average shares of common stock.
|
(2) Includes $3.5 million of interest expense related to
the financing lease obligation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Measures
|
Six Months Ended July 31, 2015
|
|
|
|
|
|
|
|
Employer payroll
|
|
Amortization of
|
|
|
|
Adjustments related
|
|
|
|
|
|
|
Stock-based
|
|
tax on employee
|
|
acquired
|
|
Acquisition-
|
|
to financing lease
|
|
|
|
|
GAAP
|
|
compensation
|
|
stock plans
|
|
intangible assets
|
|
related costs
|
|
obligation
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
$
|
48,125
|
|
|
$
|
(12,194
|
)
|
|
|
$
|
(661
|
)
|
|
|
$
|
(2,483
|
)
|
|
|
$
|
-
|
|
|
|
$
|
-
|
|
|
$
|
32,787
|
|
Gross Margin
|
|
|
82.4
|
%
|
|
|
4.5
|
%
|
|
|
|
0.2
|
%
|
|
|
|
0.9
|
%
|
|
|
|
-
|
%
|
|
|
|
-
|
%
|
|
|
88.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
93,006
|
|
|
|
(39,376
|
)
|
|
|
|
(1,635
|
)
|
|
|
|
(148
|
)
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
51,847
|
|
Sales and marketing
|
|
|
213,775
|
|
|
|
(57,820
|
)
|
|
|
|
(2,061
|
)
|
|
|
|
(305
|
)
|
|
|
|
-
|
|
|
|
|
-
|
|
|
|
153,589
|
|
General and administrative
|
|
|
55,632
|
|
|
|
(20,328
|
)
|
|
|
|
(1,182
|
)
|
|
|
|
-
|
|
|
|
|
(1,993
|
)
|
|
|
|
(444
|
)
|
|
|
31,685
|
|
Operating income (loss)
|
|
|
(136,547
|
)
|
|
|
129,718
|
|
|
|
|
5,539
|
|
|
|
|
2,936
|
|
|
|
|
1,993
|
|
|
|
|
444
|
|
|
|
4,083
|
|
Operating margin
|
|
|
(49.8
|
)%
|
|
|
47.3
|
%
|
|
|
|
2.0
|
%
|
|
|
|
1.1
|
%
|
|
|
|
0.7
|
%
|
|
|
|
0.2
|
%
|
|
|
1.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(126,475
|
)
|
|
$
|
129,718
|
|
|
|
$
|
5,539
|
|
|
|
$
|
2,936
|
|
|
|
$
|
(8,931
|
)(2)
|
|
|
|
$
|
444
|
|
|
$
|
3,231
|
|
Net income (loss) per share(1)
|
|
$
|
(1.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) GAAP net loss per share calculated based on 125,602
weighted-average shares of common stock. Non-GAAP net income per
share calculated based on 131,153 diluted weighted-average shares
of common stock, which includes 5,551 potentially dilutive shares
related to employee stock awards. GAAP to Non-GAAP net income
(loss) per share is not reconciled due to the difference in the
number of shares used to calculate basic and diluted
weighted-average shares of common stock.
|
(2) Includes $10.9 million related to the partial release
of the valuation allowance due to acquisition.
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160825006238/en/
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|