[May 08, 2018] |
|
Cornerstone OnDemand Announces First Quarter 2018 Financial Results
Human capital management software provider Cornerstone
OnDemand, Inc. (NASDAQ: CSOD) today announced results for its
first quarter ended March 31, 2018.
"We had a solid Q1 while demonstrating strong progress against our
strategic transformation plan," said Adam Miller, the Company's CEO. "We
feel our ability to deliver in the midst of this major transformation is
a positive indicator that we are moving in the right direction. We
believe the changes we are implementing will make us stronger, more
focused, and better positioned for growth."
Adoption of the New Revenue Recognition Standard - ASC 606
The Company adopted the new revenue recognition accounting standard
Accounting Standards Codification ("ASC") 606 effective January 1,
2018 on a modified retrospective basis. Financial results for reporting
periods during 2018 are presented in compliance with the new revenue
recognition standard. Historical financial results for reporting periods
prior to 2018 are presented in conformity with amounts previously
disclosed under the prior revenue recognition standard ASC 605. This
press release includes additional information to reconcile the impacts
of the adoption of the new revenue recognition standard on the Company's
financial results for the quarter ended March 31, 2018. This includes
the presentation of financial results during 2018 under ASC 605 for
comparison to the prior year.
First Quarter 2018 Results - ASC 606 (standard adopted effective
January 1, 2018):
-
Revenue for the first quarter of 2018 was $133.1 million compared to a
guided range of $126.0 million to $128.0 million.
-
Subscription revenue for the first quarter of 2018 was $113.1 million
compared to a guided range of $111.0 million to $113.0 million.
-
The Company's operating loss for the first quarter of 2018 was $(8.8)
million, yielding a margin of (6.6)%.
-
Non-GAAP operating income for the first quarter of 2018 was $12.9
million, yielding a margin of 9.7%.1
-
The Company's net loss for the first quarter of 2018 was $(16.2)
million, or a $(0.28) diluted net loss per share.
-
Non-GAAP net income for the first quarter of 2018 was $9.0 million, or
a $0.14 diluted net income per share.1
-
Unlevered free cash flow for the first quarter of 2018 was $(10.2)
million, yielding a margin of (7.6)%, compared to $(13.8) million,
yielding a margin of (12.4)% in 2017.1
First Quarter 2018 Results - ASC 605
-
Revenue for the first quarter of 2018 was $132.7 million, representing
a 18.9% increase compared to the prior year. Revenue growth on a
constant currency basis was 14.8%.1
-
Subscription revenue for the first quarter of 2018 was $114.4 million,
representing a 23.1% increase compared to the prior year. Subscription
revenue growth on a constant currency basis was 19.1%.1
-
The Company's operating loss for the first quarter of 2018 was $(9.6)
million, yielding a margin of (7.2)%, compared to $(13.1) million,
yielding a margin of (11.8)%, in the prior year.
-
Non-GAAP operating income for the first quarter of 2018 was $12.2
million, yielding a margin of 9.2%, compared to $4.9 million, yielding
a margin of 4.4%, in the prior year.1
-
The Company's net loss for the first quarter of 2018 was $(17.0)
million, or a $(0.30) diluted net loss per share, compared to a net
loss of $(16.2) million, or a $(0.29) diluted net loss per share, in
the prior year.
-
Non-GAAP net income for the first quarter of 2018 was $8.2 million, or
a $0.13 diluted net income per share, compared to $4.8 million, or a
$0.08 diluted net income per share in the prior year.1
"The first quarter outperformed expectations in all areas, from top line
growth to unlevered free cash flow," said Brian Swartz, the Company's
CFO. "We are pleased with this performance and believe there are
opportunities to drive even more improvement as Cornerstone continues to
execute on its strategic plan."
Recent Highlights:
-
The Company announced a partnership with Facebook, focused on its
integration between Workplace by Facebook and the Cornerstone
Learning Suite. The integration is focused on bringing the Company's
recently introduced "learning playlist" functionality into Workplace,
further integrating learning and development into the flow of daily
work and promoting a collaborative work environment.
-
The Company announced a surge of European client demand in the third
and fourth quarters of 2017. Growth in new clients nearly doubled in
the latter half of 2017, when compared to the first half of the year,
reaching a total of approximately 650 clients in Europe.
-
The Company hired Jennifer Gianola as its new Vice President of
Investor Relations and Chris Wheaton as its new Vice President of
Field Operations.
-
The Company announced the University of Tennessee System selected its
learning and extended enterprise solutions to provide crucial training
for its faculty and staff across six campuses and institutes, as well
as certification programs for external stakeholders.
-
The Company announced that it partnered with Palo Alto-based think
tank Institute for the Future to identify the urgent skills people
must master today to distinguish themselves and survive the workplace
of tomorrow.
-
The Company ended the first quarter of 2018 with 3,280 clients and 36
million users.2
Stock Repurchase Program:
The following is a summary of the Company's stock repurchases as of May
4, 2018 (in thousands, except per share information):
Period
|
|
# of Shares
Repurchased
|
|
Average Price
per Share
|
|
Total
Expenditures
|
November 8, 2017 - December 31, 2017
|
|
635
|
|
$
|
35.55
|
|
$
|
22,599
|
January 1, 2018 - March 31, 2018
|
|
423
|
|
$
|
37.84
|
|
|
16,024
|
April 1, 2018 - May 4, 2018
|
|
100
|
|
$
|
39.44
|
|
|
3,988
|
Total
|
|
1,158
|
|
$
|
36.74
|
|
$
|
42,611
|
At March 31, 2018, $61.4 million remained available under the share
repurchase program.
Financial Outlook:
The following outlook is based on information available as of the date
of this press release and is subject to change in the future. The
Company has provided a supplemental financial presentation summarizing
the adoption of ASC 606 (and on an ASC 605 basis) located on its
Investor Relations website at http://investors.cornerstoneondemand.com.
All numbers below are presented on an ASC 606 basis unless otherwise
stated. Note that the United States dollar (USD) strengthened against
the British pound (GBP) and Euro (EUR) since the Company's previous full
year 2018 guidance was issued on February 13, 2018. For the second
quarter ending June 30, 2018, the Company provides the following outlook:
-
Revenue between $127.0 million and $129.0 million, representing
year-over-year growth at the mid-point of 10%3, or 8%4
on a constant currency basis.
-
Revenue growth at the mid-point on an ASC 605 basis was 10%3,
or 8%4 on a constant currency basis.
-
Subscription revenue between $111.0 million and $113.0 million,
representing year-over-year growth at the mid-point of 16%3,
or 14%4 on a constant currency basis.
-
Subscription revenue growth at the mid-point on an ASC 605 basis
was 17%3, or 15%4 on a constant currency
basis.
For the year ending December 31, 2018, the Company provides the
following outlook:
-
Revenue between $503.0 million and $511.0 million, representing
year-over-year growth at the mid-point of 5%5, or 3%6
on a constant currency basis.
-
Revenue growth at the mid-point on an ASC 605 basis was 5%5,
or 3%6 on a constant currency basis.
-
Subscription revenue between $453.0 million and $461.0 million,
representing year-over-year growth at the mid-point of 15%5,
or 13%6 on a constant currency basis.
-
Subscription revenue growth at the mid-point on an ASC 605 basis
was 17%5, or 15%6 on a constant currency
basis.
-
Annual recurring revenue as of December 31, 2018 between $477.0
million and $495.0 million.5, 7
-
Non-GAAP operating income between $54.0 million and $62.0 million.
Assuming the midpoint of the revenue range, this represents an
operating margin of 11%.
-
Unlevered free cash flow between $52.0 million and $60.0 million.
Assuming the midpoint of the revenue range, this represents an
unlevered free cash flow margin of 11%.
The Company has not reconciled the guidance for non-GAAP operating
income or non-GAAP operating margin to the corresponding GAAP measures
because it does not provide guidance for such GAAP measures and would
not be able to present the reconciling items between such GAAP and
non-GAAP measures without unreasonable efforts. For non-GAAP operating
income and non-GAAP operating margin, the Company excludes stock-based
compensation expense, which is impacted by factors that are outside of
the Company's control and can be difficult to predict. The actual amount
of stock-based compensation expense in the second quarter ending June
30, 2018 and the year ending December 31, 2018 will have a significant
impact on the Company's GAAP operating margin.
|
1
|
|
Financial measures presented on a constant currency basis, non-GAAP
operating income, non-GAAP operating income margin, non-GAAP net
income, non-GAAP diluted net income per share, unlevered free cash
flow and unlevered free cash flow margin are non-GAAP financial
measures. Please see the discussion in the section titled "Non-GAAP
Financial Measures" and the reconciliations at the end of this press
release.
|
2
|
|
Includes contracted clients and active users of our enterprise human
capital management platform and excludes clients and users of our
Cornerstone for Salesforce and PiiQ, formerly known as Cornerstone
Growth Edition, products.
|
|
|
|
In order to translate the financial outlook for entities reporting
in British pounds (GBP) to United States dollars (USD) and Euro
(EUR) to United States dollars (USD), the following exchange rates
have been applied:
|
|
|
|
|
|
3
|
|
Exchange rate applied to revenue for the second quarter of 2018
|
|
$1.36 USD per GBP
|
|
|
|
|
|
4
|
|
Exchange rate from the second quarter of 2017 applied to calculate
revenue growth for the second quarter of 2018 on a constant currency
basis
|
|
$1.28 USD per GBP
|
|
|
|
|
|
5
|
|
Exchange rate applied to revenue and annual recurring revenue for
fiscal 2018
|
|
$1.36 USD per GBP
|
|
|
|
|
|
6
|
|
Exchange rate applied to calculate revenue growth for fiscal 2018 on
a constant currency basis
|
|
$1.36 USD per GBP
|
|
|
|
|
|
7
|
|
Exchange rate applied to annual recurring revenue for fiscal 2018
|
|
$1.20 USD per EUR
|
Quarterly Conference Call
Cornerstone OnDemand, Inc. will host a conference call to discuss its
first quarter 2018 results at 2:00 p.m. PT (5:00 p.m. ET) today. A live
audio webcast of the conference call, together with detailed financial
information, can be accessed through the Company's Investor Relations
website at http://investors.cornerstoneondemand.com.
The live call can be accessed by dialing (877) 445-4619 (U.S.) or
(484) 653-6763 (outside the U.S.) and referencing passcode: 2789279. A
replay of the call will also be available at http://investors.cornerstoneondemand.com/investors/news-and-events/events/default.aspx
or via telephone until 11:59 p.m. PT on May 11, 2018 by dialing
(855) 859-2056 (U.S.) or (404) 537-3406 (outside the U.S.), and
referencing passcode: 2789279.
About Cornerstone OnDemand
Cornerstone OnDemand, Inc. (NASDAQ: CSOD) is a global leader in
cloud-based learning and human capital management software. The Company
is pioneering solutions to help organizations realize the potential of
the modern workforce. From recruitment, onboarding, training and
collaboration, to performance management, compensation, succession
planning, people administration and analytics, Cornerstone is designed
to enable a lifetime of learning and development that is fundamental to
the growth of employees and organizations.
Based in Santa Monica, California, the Company's solutions are used by
3,280 clients worldwide, spanning 36 million users across 192 countries
and 43 languages. To learn more about Cornerstone, visit us on Twitter,
Facebook and our blog. www.cornerstoneondemand.com
Note: Cornerstone® and Cornerstone OnDemand® are
registered trademarks of Cornerstone OnDemand, Inc.
Forward-looking Statements
This press release and the quarterly conference call referenced above
contain forward-looking statements, including, but not limited to,
statements regarding our future financial and operating performance,
including our GAAP and non-GAAP guidance, the growth of the learning and
human capital management market, our business strategy, plans and
objectives for future operations, the demand for and benefits from the
use of our current and future solutions both domestically and
internationally, the opportunity to upsell to our existing clients, the
timing and release of new solutions and the success of such solutions,
changes to our corporate governance structure, the use of proceeds from
the sale of our convertible notes, the share repurchase program and the
factors that will impact the amount and timing of purchases, if any,
thereunder, our ability to realize potential benefits from our recent
and ongoing operational excellence and strategic transformation plans,
our expectations regarding recurring revenue growth and operating
margins, and general business conditions. Any forward-looking statements
contained in this press release or the quarterly conference call are
based upon our historical performance and our current plans, estimates
and expectations and are not a representation that such plans,
estimates, or expectations will be achieved. These forward-looking
statements represent our expectations as of the date of this press
release. Subsequent events may cause these expectations to change, and
we disclaim any obligation to update the forward-looking statements in
the future, except as required by law. These forward-looking statements
are subject to known and unknown risks and uncertainties that may cause
actual results to differ materially from our current expectations.
Important factors that could cause actual results to differ materially
from those anticipated in our forward-looking statements include, but
are not limited to, our ability to attract new clients; the extent to
which clients renew their subscriptions for our solutions; the timing of
when consulting services are delivered to new and existing clients by
our services organization and implementation subcontractors; the
complexity of deployments and product implementations, which can impact
the timing of when revenue is recognized from new and existing clients;
allowing our implementation subcontractors to contract directly with
clients for implementation services; shifted focus to recurring revenue
streams; our ability to compete as the learning and human capital
management provider for organizations of all sizes; changes in the
proportion of our client base that is comprised of enterprise or
mid-sized organizations; our ability to manage our growth, including
additional headcount and entry into new geographies; our ability to
expand our enterprise and mid-market sales opportunities; our ability to
maintain stable and consistent quota attainment rates; continued strong
demand for learning and human capital management in the U.S., Europe,
Asia Pacific and Latin America; the timing and success of efforts to
increase operational efficiency and cost containment; the possibility
that the share repurchase program may be suspended or discontinued; the
timing and success of solutions offered by our competitors;
unpredictable macro-economic conditions; the impact of foreign exchange
rates; reductions in information technology spending; the success of our
new product and service introductions; a disruption in our hosting
network infrastructure; problems caused by security breaches; costs and
reputational harm that could result from defects in our solutions; the
success of our strategic relationships with third parties; the loss of
any of our key employees and our ability to locate qualified
replacements; failure to protect our intellectual property; acts of
terrorism or other vandalism, war or natural disasters; changes in
current tax or accounting rules; legal or political changes in local or
foreign jurisdictions that decrease demand for, or restrict our ability
to sell or provide, our products; and unanticipated costs or liabilities
related to businesses that we acquire. Further information on factors
that could cause actual results to differ materially from the results
anticipated by our forward-looking statements is included in the reports
we have filed with the Securities and Exchange Commission, including our
Annual Report on Form 10-K for the fiscal year ended December 31, 2017.
Non-GAAP Financial Measures
To supplement its consolidated financial statements, which are prepared
and presented in accordance with U.S. generally accepted accounting
principles, or GAAP, the Company has provided in this press release and
the quarterly conference call held on the date hereof certain measures
that have not been prepared in accordance with GAAP. These non-GAAP
financial measures include (i) non-GAAP cost of revenue, which is
defined as cost of revenue less amortization of intangible assets and
stock-based compensation, (ii) annual recurring revenue, which is
defined as the annualized recurring value of all active contracts at the
end of a reporting period, (iii) free cash flow, which is defined as net
cash provided by operating activities minus capital expenditures and
capitalized software costs, (iv) free cash flow margin, which is defined
as free cash flow divided by revenue, (v) unlevered free cash flow,
which is defined as net cash provided by operating activities minus
capital expenditures and capitalized software costs plus cash paid for
interest, (vi) unlevered free cash flow margin, which is defined as
unlevered free cash flow divided by revenue, (vii) non-GAAP net income
and non-GAAP diluted net income per share, which exclude, for the
periods in which they are presented, stock-based compensation,
amortization of intangible assets, accretion of debt discount and
amortization of debt issuance costs, unrealized fair value adjustment on
strategic investment, and excludes the impacts of unamortized
stock-based compensation expense in applying the treasury method for
determining the non-GAAP weighted average number of dilutive shares
outstanding, (viii) non-GAAP gross profit and non-GAAP gross margin,
which exclude stock-based compensation and amortization of intangible
assets reflected in cost of revenue, (ix) non-GAAP operating income and
non-GAAP operating income margin, which are defined as loss from
operations excluding stock-based compensation and amortization of
intangible assets, (x) non-GAAP operating expenses, which exclude
stock-based compensation and amortization of intangible assets, and (xi)
non-GAAP sales and marketing expense, non-GAAP research and development
expense, and non-GAAP general and administrative expense, each of which
excludes stock-based compensation attributable to the corresponding GAAP
financial measures. In addition, the Company provides investors with
non-GAAP financial measures under ASC 605 to compare against the
Company's GAAP financial measures under ASC 606 and discloses revenue on
a constant currency basis. To present amounts on a constant currency
basis, current period results for entities reporting in functional
currencies other than the United States dollar are translated into the
United States dollar at the prior period exchange rates as opposed to
the actual exchange rates in effect for the current period. The Company
presents constant currency information to provide a framework for
assessing how its underlying business performed excluding the effect of
foreign currency fluctuations.
The Company's management uses these non-GAAP financial measures
internally in analyzing its financial results and believes they are
useful to investors, as a supplement to the corresponding GAAP measures,
in evaluating the Company's ongoing operational performance and trends
and in comparing its financial measures with other companies in the same
industry, many of which present similar non-GAAP financial measures to
help investors understand the operational performance of their
businesses. In addition, the Company believes that the following
non-GAAP adjustments are useful to management and investors for the
following reasons:
-
Stock-based compensation. The Company excludes stock-based
compensation expense because it is non-cash in nature, and management
believes that its exclusion provides additional insight into the
Company's operational performance and also provides a useful
comparison of the Company's operating results to prior periods and its
peer companies. Additionally, determining the fair value of certain
stock-based awards involves a high degree of judgment and estimation
and the expense recorded may bear little resemblance to the actual
value realized upon the vesting or future exercise of such awards.
-
Amortization of intangible assets. The Company excludes
amortization of acquired intangible assets because the expense is a
non-cash item and management believes that its exclusion provides
meaningful supplemental information regarding the Company's
operational performance and allows for a useful comparison of its
operating results to prior periods and its peer companies.
-
Accretion of debt discount and amortization of debt issuance costs. Under
GAAP, the Company is required to separately account for liability and
equity components of the senior convertible notes that were issued in
June 2013. Accordingly, for GAAP purposes, the Company is required to
recognize the effective interest expense on its senior convertible
notes and amortize the issuance costs over the term of the notes. The
difference between the effective interest expense and the contractual
interest expense, and the amortization expense of issuance costs are
excluded from management's assessment of the Company's operating
performance because management believes that these non-cash expenses
are not indicative of ongoing operating performance. In addition, the
exclusion of these items provides a useful comparison of the Company's
operating results to prior periods and its peer companies.
-
Fair value adjustment on strategic investments. The Company
views the increase or decrease in fair value of its strategic
investments as not indicative of operational performance during any
particular period and believes that the exclusion of these gains or
losses provides investors with a supplemental view of the Company's
operational performance.
-
Restructuring. The Company excludes costs related to
restructuring because the expense is not indicative of its continuing
operations and believes that the exclusion of these costs provides
investors with a supplemental view of the Company's operational
performance.
-
Write-off of capitalized software. The Company views the
write-off of capitalized software as not indicative of operational
performance during any particular period and believes that the
exclusion of this expense provides investors with a supplemental view
of the Company's operational performance.
Non-GAAP financial measures should not be considered in isolation from,
or as a substitute for, financial information prepared in accordance
with GAAP. Investors are encouraged to review the reconciliation of
these non-GAAP measures to their most directly comparable GAAP financial
measures. These non-GAAP financial measures are not based on any
standardized methodology prescribed by GAAP and are not necessarily
comparable to similarly-titled measures presented by other companies.
For prior periods, reconciliations of the non-GAAP financial measures to
their most directly comparable GAAP measures have been provided in the
tables included as part of this press release.
Cornerstone OnDemand, Inc.
|
CONSOLIDATED BALANCE SHEETS
|
(in thousands)
|
(unaudited)
|
|
|
|
March 31,
2018 *
|
|
December 31,
2017
|
Assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
413,345
|
|
|
$
|
393,576
|
|
Short-term investments
|
|
|
204,174
|
|
|
|
169,551
|
|
Accounts receivable, net
|
|
|
113,956
|
|
|
|
154,428
|
|
Deferred commissions, current portion
|
|
|
22,830
|
|
|
|
42,806
|
|
Prepaid expenses and other current assets
|
|
|
30,885
|
|
|
|
21,754
|
|
Total current assets
|
|
|
785,190
|
|
|
|
782,115
|
|
|
|
|
|
|
Capitalized software development costs, net
|
|
|
39,387
|
|
|
|
37,431
|
|
Property and equipment, net
|
|
|
24,582
|
|
|
|
20,817
|
|
Deferred commissions, net of current portion
|
|
|
34,155
|
|
|
|
-
|
|
Long-term investments
|
|
|
21,712
|
|
|
|
96,949
|
|
Goodwill
|
|
|
25,894
|
|
|
|
25,894
|
|
Other assets, net
|
|
|
3,813
|
|
|
|
3,984
|
|
Total Assets
|
|
$
|
934,733
|
|
|
$
|
967,190
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
Liabilities:
|
|
|
|
|
Accounts payable
|
|
$
|
10,095
|
|
|
$
|
17,637
|
|
Accrued expenses
|
|
|
48,256
|
|
|
|
57,528
|
|
Deferred revenue, current portion
|
|
|
287,875
|
|
|
|
311,997
|
|
Convertible notes, net
|
|
|
250,497
|
|
|
|
248,025
|
|
Other liabilities
|
|
|
5,570
|
|
|
|
9,051
|
|
Total current liabilities
|
|
|
602,293
|
|
|
|
644,238
|
|
|
|
|
|
|
Convertible notes, net
|
|
|
286,256
|
|
|
|
285,168
|
|
Other liabilities, non-current
|
|
|
1,408
|
|
|
|
1,498
|
|
Deferred revenue, net of current portion
|
|
|
12,415
|
|
|
|
14,166
|
|
Total liabilities
|
|
|
902,372
|
|
|
|
945,070
|
|
|
|
|
|
|
Stockholders' Equity:
|
|
|
|
|
Common stock
|
|
|
6
|
|
|
|
6
|
|
Additional paid-in capital
|
|
|
546,808
|
|
|
|
536,951
|
|
Accumulated deficit
|
|
|
(512,335
|
)
|
|
|
(515,054
|
)
|
Accumulated other comprehensive (loss) income
|
|
|
(2,118
|
)
|
|
|
217
|
|
Total stockholders' equity
|
|
|
32,361
|
|
|
|
22,120
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
934,733
|
|
|
$
|
967,190
|
|
|
*As adjusted to reflect the impact of the adoption of ASC 606.
|
|
Cornerstone OnDemand, Inc.
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
|
2018 *
|
|
|
|
2017
|
|
Revenue
|
|
$
|
133,113
|
|
|
$
|
111,582
|
|
Cost of revenue 1, 2
|
|
|
37,020
|
|
|
|
33,949
|
|
Gross profit
|
|
|
96,093
|
|
|
|
77,633
|
|
Operating expenses:
|
|
|
|
|
Sales and marketing 1
|
|
|
59,245
|
|
|
|
56,894
|
|
Research and development 1
|
|
|
15,984
|
|
|
|
13,411
|
|
General and administrative 1
|
|
|
21,985
|
|
|
|
20,476
|
|
Restructuring 1
|
|
|
7,725
|
|
|
|
-
|
|
Total operating expenses
|
|
|
104,939
|
|
|
|
90,781
|
|
Loss from operations
|
|
|
(8,846
|
)
|
|
|
(13,148
|
)
|
Other income (expense):
|
|
|
|
|
Interest income
|
|
|
1,819
|
|
|
|
613
|
|
Interest expense
|
|
|
(8,700
|
)
|
|
|
(3,302
|
)
|
Other, net
|
|
|
44
|
|
|
|
197
|
|
Other income (expense), net
|
|
|
(6,837
|
)
|
|
|
(2,492
|
)
|
Loss before income tax provision
|
|
|
(15,683
|
)
|
|
|
(15,640
|
)
|
Income tax provision
|
|
|
(533
|
)
|
|
|
(571
|
)
|
Net loss
|
|
$
|
(16,216
|
)
|
|
$
|
(16,211
|
)
|
Net loss per share, basic and diluted
|
|
$
|
(0.28
|
)
|
|
$
|
(0.29
|
)
|
Weighted average common shares outstanding, basic and diluted
|
|
|
57,425
|
|
|
|
56,642
|
|
|
1 Includes stock-based compensation as follows:
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
|
2018 *
|
|
|
|
2017
|
|
Cost of revenue
|
|
$
|
1,002
|
|
|
$
|
1,210
|
|
Sales and marketing
|
|
|
6,246
|
|
|
|
6,754
|
|
Research and development
|
|
|
2,308
|
|
|
|
2,102
|
|
General and administrative
|
|
|
4,487
|
|
|
|
5,783
|
|
Restructuring
|
|
|
5,436
|
|
|
|
-
|
|
Total
|
|
$
|
19,479
|
|
|
$
|
15,849
|
|
|
2 Cost of revenue includes amortization of intangible
assets as follows:
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
|
2018 *
|
|
|
|
2017
|
|
Cost of revenue
|
|
$
|
-
|
|
|
$
|
2,217
|
|
|
*As adjusted to reflect the impact of the adoption of ASC 606.
|
|
Cornerstone OnDemand, Inc.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in thousands)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
|
2018 *
|
|
|
|
2017
|
|
Cash flows from operating activities:
|
|
|
|
|
Net loss
|
|
$
|
(16,216
|
)
|
|
$
|
(16,211
|
)
|
Adjustments to reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
Depreciation and amortization
|
|
|
7,831
|
|
|
|
9,328
|
|
Accretion of debt discount and amortization of debt issuance costs
|
|
|
3,426
|
|
|
|
2,353
|
|
Purchased investment premium, net of amortization
|
|
|
(81
|
)
|
|
|
155
|
|
Net foreign currency gain
|
|
|
(356
|
)
|
|
|
(530
|
)
|
Stock-based compensation expense
|
|
|
19,479
|
|
|
|
15,849
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
|
41,888
|
|
|
|
38,257
|
|
Deferred commissions
|
|
|
(528
|
)
|
|
|
1,718
|
|
Prepaid expenses and other assets
|
|
|
(8,841
|
)
|
|
|
(7,433
|
)
|
Accounts payable
|
|
|
(7,605
|
)
|
|
|
(14,485
|
)
|
Accrued expenses
|
|
|
(15,059
|
)
|
|
|
(13,776
|
)
|
Deferred revenue
|
|
|
(23,751
|
)
|
|
|
(22,637
|
)
|
Other liabilities
|
|
|
(4,767
|
)
|
|
|
177
|
|
Net cash used in operating activities
|
|
|
(4,580
|
)
|
|
|
(7,235
|
)
|
Cash flows from investing activities:
|
|
|
|
|
Purchases of investments
|
|
|
-
|
|
|
|
(77,281
|
)
|
Maturities of investments
|
|
|
40,677
|
|
|
|
65,487
|
|
Capital expenditures
|
|
|
(2,559
|
)
|
|
|
(2,698
|
)
|
Capitalized software costs
|
|
|
(6,039
|
)
|
|
|
(5,756
|
)
|
Net cash provided by (used in) investing activities
|
|
|
32,079
|
|
|
|
(20,248
|
)
|
Cash flows from financing activities:
|
|
|
|
|
Payments of debt issuance costs
|
|
|
(152
|
)
|
|
|
-
|
|
Proceeds from employee stock plans
|
|
|
6,765
|
|
|
|
3,473
|
|
Repurchases of common stock
|
|
|
(14,700
|
)
|
|
|
-
|
|
Net cash (used in) provided by financing activities
|
|
|
(8,087
|
)
|
|
|
3,473
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
357
|
|
|
|
570
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
19,769
|
|
|
|
(23,440
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
393,576
|
|
|
|
83,300
|
|
Cash and cash equivalents at end of period
|
|
$
|
413,345
|
|
|
$
|
59,860
|
|
Supplemental cash flow information:
|
|
|
|
|
Cash paid for interest
|
|
$
|
3,000
|
|
|
$
|
1,898
|
|
Cash paid for income taxes
|
|
|
452
|
|
|
|
648
|
|
Proceeds from employee stock plans received in advance of stock
issuance
|
|
|
1,616
|
|
|
|
1,393
|
|
Non-cash investing and financing activities:
|
|
|
|
|
Capitalized assets financed by accounts payable and accrued expenses
|
|
$
|
5,201
|
|
|
$
|
623
|
|
Capitalized stock-based compensation
|
|
|
1,253
|
|
|
|
1,135
|
|
Unsettled share repurchase in other liabilities
|
|
|
1,325
|
|
|
|
-
|
|
|
*As adjusted to reflect the impact of the adoption of ASC 606.
|
|
Cornerstone OnDemand, Inc.
|
CONSOLIDATED BALANCE SHEETS
|
RECONCILIATION OF THE IMPACTS OF THE ADOPTION OF ASC 606
|
(in thousands)
|
(unaudited)
|
|
|
|
March 31, 2018
|
|
December 31,
2017
|
|
|
As Reported
(ASC 606)
|
|
Impacts of
Adoption
|
|
Without
Adoption
(ASC 605)
|
|
As Reported
(ASC 605)
|
Assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
413,345
|
|
|
$
|
-
|
|
|
$
|
413,345
|
|
|
$
|
393,576
|
|
Short-term investments
|
|
|
204,174
|
|
|
|
-
|
|
|
|
204,174
|
|
|
|
169,551
|
|
Accounts receivable, net
|
|
|
113,956
|
|
|
|
-
|
|
|
|
113,956
|
|
|
|
154,428
|
|
Deferred commissions, current portion
|
|
|
22,830
|
|
|
|
18,207
|
|
|
|
41,037
|
|
|
|
42,806
|
|
Prepaid expenses and other current assets
|
|
|
30,885
|
|
|
|
-
|
|
|
|
30,885
|
|
|
|
21,754
|
|
Total current assets
|
|
|
785,190
|
|
|
|
18,207
|
|
|
|
803,397
|
|
|
|
782,115
|
|
|
|
|
|
|
|
|
|
|
Capitalized software development costs, net
|
|
|
39,387
|
|
|
|
-
|
|
|
|
39,387
|
|
|
|
37,431
|
|
Property and equipment, net
|
|
|
24,582
|
|
|
|
-
|
|
|
|
24,582
|
|
|
|
20,817
|
|
Deferred commissions, net of current portion
|
|
|
34,155
|
|
|
|
(34,155
|
)
|
|
|
-
|
|
|
|
-
|
|
Long-term investments
|
|
|
21,712
|
|
|
|
-
|
|
|
|
21,712
|
|
|
|
96,949
|
|
Goodwill
|
|
|
25,894
|
|
|
|
-
|
|
|
|
25,894
|
|
|
|
25,894
|
|
Other assets, net
|
|
|
3,813
|
|
|
|
-
|
|
|
|
3,813
|
|
|
|
3,984
|
|
Total Assets
|
|
$
|
934,733
|
|
|
$
|
(15,948
|
)
|
|
$
|
918,785
|
|
|
$
|
967,190
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
10,095
|
|
|
$
|
-
|
|
|
$
|
10,095
|
|
|
$
|
17,637
|
|
Accrued expenses
|
|
|
48,256
|
|
|
|
(2,625
|
)
|
|
|
45,631
|
|
|
|
57,528
|
|
Deferred revenue, current portion
|
|
|
287,875
|
|
|
|
6,501
|
|
|
|
294,376
|
|
|
|
311,997
|
|
Convertible notes, net
|
|
|
250,497
|
|
|
|
-
|
|
|
|
250,497
|
|
|
|
248,025
|
|
Other liabilities
|
|
|
5,570
|
|
|
|
-
|
|
|
|
5,570
|
|
|
|
9,051
|
|
Total current liabilities
|
|
|
602,293
|
|
|
|
3,876
|
|
|
|
606,169
|
|
|
|
644,238
|
|
|
|
|
|
|
|
|
|
|
Convertible notes, net
|
|
|
286,256
|
|
|
|
-
|
|
|
|
286,256
|
|
|
|
285,168
|
|
Other liabilities, non-current
|
|
|
1,408
|
|
|
|
-
|
|
|
|
1,408
|
|
|
|
1,498
|
|
Deferred revenue, net of current portion
|
|
|
12,415
|
|
|
|
-
|
|
|
|
12,415
|
|
|
|
14,166
|
|
Total liabilities
|
|
|
902,372
|
|
|
|
3,876
|
|
|
|
906,248
|
|
|
|
945,070
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity:
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
6
|
|
|
|
-
|
|
|
|
6
|
|
|
|
6
|
|
Additional paid-in capital
|
|
|
546,808
|
|
|
|
-
|
|
|
|
546,808
|
|
|
|
536,951
|
|
Accumulated deficit
|
|
|
(512,335
|
)
|
|
|
(19,824
|
)
|
|
|
(532,159
|
)
|
|
|
(515,054
|
)
|
Accumulated other comprehensive (loss) income
|
|
|
(2,118
|
)
|
|
|
-
|
|
|
|
(2,118
|
)
|
|
|
217
|
|
Total stockholders' equity
|
|
|
32,361
|
|
|
|
(19,824
|
)
|
|
|
12,537
|
|
|
|
22,120
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
934,733
|
|
|
$
|
(15,948
|
)
|
|
$
|
918,785
|
|
|
$
|
967,190
|
|
|
Cornerstone OnDemand, Inc.
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
RECONCILIATION OF THE IMPACTS OF THE ADOPTION OF ASC 606
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
|
|
As Reported
(ASC 606)
|
|
Impacts of
Adoption
|
|
Without
Adoption
(ASC 605)
|
|
As Reported
(ASC 605)
|
Revenue
|
|
$
|
133,113
|
|
|
$
|
(441
|
)
|
|
$
|
132,672
|
|
|
$
|
111,582
|
|
Cost of revenue
|
|
|
37,020
|
|
|
|
-
|
|
|
|
37,020
|
|
|
|
33,949
|
|
Gross profit
|
|
|
96,093
|
|
|
|
(441
|
)
|
|
|
95,652
|
|
|
|
77,633
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Sales and marketing
|
|
|
59,245
|
|
|
|
300
|
|
|
|
59,545
|
|
|
|
56,894
|
|
Research and development
|
|
|
15,984
|
|
|
|
-
|
|
|
|
15,984
|
|
|
|
13,411
|
|
General and administrative
|
|
|
21,985
|
|
|
|
-
|
|
|
|
21,985
|
|
|
|
20,476
|
|
Restructuring
|
|
|
7,725
|
|
|
|
-
|
|
|
|
7,725
|
|
|
|
-
|
|
Total operating expenses
|
|
|
104,939
|
|
|
|
300
|
|
|
|
105,239
|
|
|
|
90,781
|
|
Loss from operations
|
|
|
(8,846
|
)
|
|
|
(741
|
)
|
|
|
(9,587
|
)
|
|
|
(13,148
|
)
|
Other income (expense):
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
1,819
|
|
|
|
-
|
|
|
|
1,819
|
|
|
|
613
|
|
Interest expense
|
|
|
(8,700
|
)
|
|
|
-
|
|
|
|
(8,700
|
)
|
|
|
(3,302
|
)
|
Other, net
|
|
|
44
|
|
|
|
-
|
|
|
|
44
|
|
|
|
197
|
|
Other income (expense), net
|
|
|
(6,837
|
)
|
|
|
-
|
|
|
|
(6,837
|
)
|
|
|
(2,492
|
)
|
Loss before income tax provision
|
|
|
(15,683
|
)
|
|
|
(741
|
)
|
|
|
(16,424
|
)
|
|
|
(15,640
|
)
|
Income tax provision
|
|
|
(533
|
)
|
|
|
-
|
|
|
|
(533
|
)
|
|
|
(571
|
)
|
Net loss
|
|
$
|
(16,216
|
)
|
|
$
|
(741
|
)
|
|
$
|
(16,957
|
)
|
|
$
|
(16,211
|
)
|
Net loss per share, basic and diluted
|
|
$
|
(0.28
|
)
|
|
|
|
$
|
(0.30
|
)
|
|
$
|
(0.29
|
)
|
Weighted average common shares outstanding, basic and diluted
|
|
|
57,425
|
|
|
|
|
|
57,425
|
|
|
|
56,642
|
|
|
Cornerstone OnDemand, Inc.
|
RECONCILIATIONS OF COST OF REVENUE TO NON-GAAP COST OF REVENUE,
GROSS PROFIT AND GROSS MARGIN TO NON-GAAP GROSS PROFIT AND
NON-GAAP GROSS MARGIN, LOSS FROM OPERATIONS TO NON-GAAP OPERATING
INCOME AND OPERATING MARGIN TO NON-GAAP OPERATING INCOME MARGIN
AND RECONCILIATION OF THE IMPACTS FROM THE ADOPTION OF ASC 606
|
(in thousands)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
|
|
As Reported
(ASC 606)
|
|
Impacts of
Adoption
|
|
Without
Adoption
(ASC 605)
|
|
As Reported
(ASC 605)
|
Reconciliation of cost of revenue, gross profit and gross margin:
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
133,113
|
|
|
$
|
(441
|
)
|
|
$
|
132,672
|
|
|
$
|
111,582
|
|
Cost of revenue
|
|
|
37,020
|
|
|
|
|
|
37,020
|
|
|
|
33,949
|
|
Gross profit
|
|
$
|
96,093
|
|
|
$
|
(441
|
)
|
|
$
|
95,652
|
|
|
$
|
77,633
|
|
Gross margin
|
|
|
72.2
|
%
|
|
|
|
|
72.1
|
%
|
|
|
69.6
|
%
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
$
|
37,020
|
|
|
$
|
-
|
|
|
$
|
37,020
|
|
|
$
|
33,949
|
|
Adjustments to cost of revenue:
|
|
|
|
|
|
|
|
|
Amortization of intangible assets
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2,217
|
)
|
Stock-based compensation
|
|
|
(1,002
|
)
|
|
|
-
|
|
|
|
(1,002
|
)
|
|
|
(1,210
|
)
|
Total adjustments to cost of revenue
|
|
|
(1,002
|
)
|
|
|
-
|
|
|
|
(1,002
|
)
|
|
|
(3,427
|
)
|
Non-GAAP costs of revenue
|
|
|
36,018
|
|
|
|
-
|
|
|
|
36,018
|
|
|
|
30,522
|
|
Non-GAAP gross profit
|
|
$
|
97,095
|
|
|
$
|
(441
|
)
|
|
$
|
96,654
|
|
|
$
|
81,060
|
|
Non-GAAP gross margin
|
|
|
72.9
|
%
|
|
|
|
|
72.9
|
%
|
|
|
72.6
|
%
|
|
|
|
|
|
|
|
|
|
Reconciliation of operating income (loss) and operating income
(loss) margin:
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
$
|
(8,846
|
)
|
|
$
|
(741
|
)
|
|
$
|
(9,587
|
)
|
|
$
|
(13,148
|
)
|
Operating margin
|
|
|
(6.6
|
)%
|
|
|
|
|
(7.2
|
)%
|
|
|
(11.8
|
)%
|
Adjustments to loss from operations:
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
|
14,043
|
|
|
|
-
|
|
|
|
14,043
|
|
|
|
15,849
|
|
Amortization of intangible assets
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,217
|
|
Restructuring
|
|
|
7,725
|
|
|
|
-
|
|
|
|
7,725
|
|
|
|
-
|
|
Total adjustments to loss from operations
|
|
|
21,768
|
|
|
|
-
|
|
|
|
21,768
|
|
|
|
18,066
|
|
Non-GAAP operating income
|
|
$
|
12,922
|
|
|
$
|
(741
|
)
|
|
$
|
12,181
|
|
|
$
|
4,918
|
|
Non-GAAP operating income margin
|
|
|
9.7
|
%
|
|
|
|
|
9.2
|
%
|
|
|
4.4
|
%
|
|
Cornerstone OnDemand, Inc.
|
RECONCILIATIONS OF NET LOSS TO NON-GAAP NET INCOME AND NON-GAAP
NET INCOME PER SHARE AND RECONCILIATION OF THE IMPACTS FROM THE
ADOPTION OF ASC 606
|
(in thousands, except per share amounts)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
2018
|
|
2017
|
|
|
As Reported
(ASC 606)
|
|
Impacts of
Adoption
|
|
Without
Adoption
(ASC 605)
|
|
As Reported
(ASC 605)
|
Net loss
|
|
$
|
(16,216
|
)
|
|
$
|
(741
|
)
|
|
$
|
(16,957
|
)
|
|
$
|
(16,211
|
)
|
Adjustments to net loss
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
|
14,043
|
|
|
|
-
|
|
|
|
14,043
|
|
|
|
15,849
|
|
Amortization of intangible assets
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,217
|
|
Accretion of debt discount and amortization of debt issuance costs1
|
|
|
3,426
|
|
|
|
-
|
|
|
|
3,426
|
|
|
|
2,353
|
|
Fair value adjustment on strategic investments 2
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
600
|
|
Restructuring
|
|
|
7,725
|
|
|
|
-
|
|
|
|
7,725
|
|
|
|
-
|
|
Total adjustments to net loss
|
|
|
25,194
|
|
|
|
-
|
|
|
|
25,194
|
|
|
|
21,019
|
|
Non-GAAP net income
|
|
$
|
8,978
|
|
|
$
|
(741
|
)
|
|
$
|
8,237
|
|
|
$
|
4,808
|
|
Non-GAAP basic net income per share
|
|
$
|
0.16
|
|
|
|
|
$
|
0.14
|
|
|
$
|
0.08
|
|
Non-GAAP diluted net income per share
|
|
$
|
0.14
|
|
|
|
|
$
|
0.13
|
|
|
$
|
0.08
|
|
Weighted-average common shares outstanding, basic
|
|
|
57,425
|
|
|
|
|
|
57,425
|
|
|
|
56,642
|
|
Non-GAAP weighted-average common shares outstanding, diluted
|
|
|
62,476
|
|
|
|
|
|
62,476
|
|
|
|
61,649
|
|
|
|
|
|
1
|
|
Debt discount accretion and debt issuance cost amortization has been
recorded in connection with our issuance of $253.0 million in
convertible notes on June 17, 2013 and $300.0 million in convertible
notes on December 8, 2017. These expenses represent non-cash charges
that have been recorded in accordance with the authoritative
accounting literature for such transactions.
|
|
|
|
2
|
|
Fair value adjustment recorded for our strategic investments in
privately-held companies.
|
|
Cornerstone OnDemand, Inc.
|
RECONCILIATION OF NET CASH USED IN OPERATING ACTIVITIES TO
UNLEVERED FREE CASH FLOW AND UNLEVERED FREE CASH FLOW MARGIN
|
(A Non-GAAP Financial Measure)
|
(in thousands)
|
(unaudited)
|
|
|
|
Three Months Ended
|
|
|
March 31,
|
|
|
|
2018
|
|
|
|
2017
|
|
Reconciliation of unlevered free cash flow:
|
|
|
|
|
Net cash used in operating activities
|
|
$
|
(4,580
|
)
|
|
$
|
(7,235
|
)
|
Capital expenditures
|
|
|
(2,559
|
)
|
|
|
(2,698
|
)
|
Capitalized software costs
|
|
|
(6,039
|
)
|
|
|
(5,756
|
)
|
Cash paid for interest
|
|
|
3,000
|
|
|
|
1,898
|
|
Unlevered free cash flow
|
|
$
|
(10,178
|
)
|
|
$
|
(13,791
|
)
|
Unlevered free cash flow margin
|
|
|
(7.6
|
)%
|
|
|
(12.4
|
)%
|
|
Cornerstone OnDemand, Inc.
|
TRENDED OPERATIONAL & FINANCIAL HIGHLIGHTS
|
(unaudited)
|
|
The following metrics are intended as a supplement to the
financial statements found in this release and other information
furnished or filed with the SEC. In the event of discrepancies
between amounts in these tables and the Company's historical
disclosures or financial statements, readers should rely on the
Company's filings with the SEC and financial statements in the
Company's most recent earnings release.
|
|
The Company intends to periodically review and refine the
definition, methodology and appropriateness of each of these
supplemental metrics. As a result, metrics are subject to removal
and/or change, and such changes could be material.
|
|
|
|
FY 2017
|
|
FY 2018
|
|
Full Year
|
|
|
Q1'17
|
|
Q2'17
|
|
Q3'17
|
|
Q4'17
|
|
Q1'18
|
|
FY15
|
|
FY16
|
|
FY17
|
SELECTED METRICS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of clients 1
|
|
2,998
|
|
|
3,076
|
|
|
3,146
|
|
|
3,250
|
|
|
3,280
|
|
|
2,595
|
|
|
2,918
|
|
|
3,250
|
|
% y/y
|
|
12.3
|
%
|
|
12.7
|
%
|
|
12.2
|
%
|
|
11.4
|
%
|
|
9.4
|
%
|
|
20.5
|
%
|
|
12.4
|
%
|
|
11.4
|
%
|
% q/q
|
|
2.7
|
%
|
|
2.6
|
%
|
|
2.3
|
%
|
|
3.3
|
%
|
|
0.9
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Number of users (in millions) 1
|
|
31.0
|
|
|
32.1
|
|
|
33.5
|
|
|
35.3
|
|
|
36.0
|
|
|
23.8
|
|
|
29.9
|
|
|
35.3
|
|
% y/y
|
|
24.2
|
%
|
|
22.3
|
%
|
|
21.1
|
%
|
|
18.1
|
%
|
|
16.1
|
%
|
|
31.8
|
%
|
|
25.6
|
%
|
|
18.1
|
%
|
% q/q
|
|
3.7
|
%
|
|
3.6
|
%
|
|
4.3
|
%
|
|
5.4
|
%
|
|
2.0
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Number of employees
|
|
1,859
|
|
|
1,933
|
|
|
1,960
|
|
|
1,891
|
|
|
1,829
|
|
|
1,645
|
|
|
1,823
|
|
|
1,891
|
|
% y/y
|
|
10.6
|
%
|
|
12.3
|
%
|
|
9.6
|
%
|
|
3.7
|
%
|
|
(1.6
|
)%
|
|
20.9
|
%
|
|
10.8
|
%
|
|
3.7
|
%
|
% q/q
|
|
2.0
|
%
|
|
4.0
|
%
|
|
1.4
|
%
|
|
(3.5
|
)%
|
|
(3.3
|
)%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Annual dollar retention rate
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
95.4
|
%
|
|
95.1
|
%
|
|
93.5
|
%
|
Annual recurring revenue
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
439,000
|
|
Unlevered free cash flow
|
|
(13,791
|
)
|
|
(5,024
|
)
|
|
16,075
|
|
|
46,420
|
|
|
(10,178
|
)
|
|
16,795
|
|
|
16,411
|
|
|
43,680
|
|
Unlevered free cash flow margin
|
|
(12.4
|
)%
|
|
(4.3
|
)%
|
|
13.2
|
%
|
|
35.2
|
%
|
|
(7.6
|
)%
|
|
4.9
|
%
|
|
3.9
|
%
|
|
9.1
|
%
|
GAAP FINANCIAL DATA - ASC 605 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
111,582
|
|
|
116,651
|
|
|
121,796
|
|
|
131,956
|
|
|
132,672
|
|
|
339,651
|
|
|
423,124
|
|
|
481,985
|
|
% y/y
|
|
12.3
|
%
|
|
9.0
|
%
|
|
13.0
|
%
|
|
21.0
|
%
|
|
18.9
|
%
|
|
28.9
|
%
|
|
24.6
|
%
|
|
13.9
|
%
|
% y/y (Constant currency)
|
|
17.2
|
%
|
|
12.7
|
%
|
|
13.1
|
%
|
|
18.3
|
%
|
|
14.8
|
%
|
|
n/a
|
|
|
29.1
|
%
|
|
15.3
|
%
|
Subscription revenue
|
|
92,932
|
|
|
96,416
|
|
|
101,130
|
|
|
106,286
|
|
|
114,433
|
|
|
270,093
|
|
|
339,756
|
|
|
396,764
|
|
% y/y
|
|
16.6
|
%
|
|
14.5
|
%
|
|
17.1
|
%
|
|
18.8
|
%
|
|
23.1
|
%
|
|
n/a
|
|
|
25.8
|
%
|
|
16.8
|
%
|
% y/y (Constant currency)
|
|
21.6
|
%
|
|
16.3
|
%
|
|
17.5
|
%
|
|
15.8
|
%
|
|
19.1
|
%
|
|
n/a
|
|
|
n/a
|
|
|
17.7
|
%
|
Subscription revenue % of total revenue
|
|
83.3
|
%
|
|
82.7
|
%
|
|
83.0
|
%
|
|
80.5
|
%
|
|
86.3
|
%
|
|
79.5
|
%
|
|
80.3
|
%
|
|
82.3
|
%
|
Loss from operations
|
|
(13,148
|
)
|
|
(18,568
|
)
|
|
(12,104
|
)
|
|
(5,436
|
)
|
|
(9,587
|
)
|
|
(68,707
|
)
|
|
(56,342
|
)
|
|
(49,256
|
)
|
GAAP FINANCIAL DATA - ASC 606 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
133,113
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Subscription revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
113,134
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Subscription revenue % of total revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
85.0
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Loss from operations
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(8,846
|
)
|
|
-
|
|
|
-
|
|
|
-
|
|
GAAP MARGIN DATA - ASC 605 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
69.6
|
%
|
|
69.7
|
%
|
|
70.7
|
%
|
|
71.3
|
%
|
|
72.1
|
%
|
|
67.7
|
%
|
|
67.9
|
%
|
|
70.4
|
%
|
Sales and marketing % of revenue
|
|
51.0
|
%
|
|
53.2
|
%
|
|
49.7
|
%
|
|
46.0
|
%
|
|
44.9
|
%
|
|
61.0
|
%
|
|
53.3
|
%
|
|
49.9
|
%
|
Research and development % of revenue
|
|
12.0
|
%
|
|
12.6
|
%
|
|
13.5
|
%
|
|
13.3
|
%
|
|
12.0
|
%
|
|
12.1
|
%
|
|
11.1
|
%
|
|
12.9
|
%
|
General and administrative % of revenue
|
|
18.4
|
%
|
|
19.8
|
%
|
|
17.4
|
%
|
|
14.9
|
%
|
|
16.6
|
%
|
|
14.7
|
%
|
|
16.8
|
%
|
|
17.6
|
%
|
Restructuring % of revenue
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
1.2
|
%
|
|
5.8
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
Operating margin
|
|
(11.8
|
)%
|
|
(15.9
|
)%
|
|
(9.9
|
)%
|
|
(4.1
|
)%
|
|
(7.2
|
)%
|
|
(20.2
|
)%
|
|
(13.3
|
)%
|
|
(10.2
|
)%
|
GAAP MARGIN DATA - ASC 606 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
72.2
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Sales and marketing % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
44.5
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Research and development % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
12.0
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
General and administrative % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
16.5
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Restructuring % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
5.8
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Operating margin
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(6.6
|
)%
|
|
-
|
|
|
-
|
|
|
-
|
|
NON-GAAP MARGIN DATA - ASC 605 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross margin
|
|
72.6
|
%
|
|
72.7
|
%
|
|
73.5
|
%
|
|
72.8
|
%
|
|
72.9
|
%
|
|
71.7
|
%
|
|
71.2
|
%
|
|
72.9
|
%
|
Non-GAAP sales and marketing % of revenue
|
|
44.9
|
%
|
|
47.4
|
%
|
|
43.2
|
%
|
|
40.8
|
%
|
|
40.2
|
%
|
|
54.0
|
%
|
|
47.3
|
%
|
|
44.0
|
%
|
Non-GAAP research and development % of revenue
|
|
10.1
|
%
|
|
10.5
|
%
|
|
11.3
|
%
|
|
10.4
|
%
|
|
10.3
|
%
|
|
10.3
|
%
|
|
9.3
|
%
|
|
10.6
|
%
|
Non-GAAP general and administrative % of revenue
|
|
13.2
|
%
|
|
13.7
|
%
|
|
12.7
|
%
|
|
11.8
|
%
|
|
13.2
|
%
|
|
11.9
|
%
|
|
12.8
|
%
|
|
12.8
|
%
|
Non-GAAP restructuring % of revenue
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
|
-
|
%
|
Non-GAAP operating margin
|
|
4.4
|
%
|
|
1.1
|
%
|
|
6.3
|
%
|
|
9.9
|
%
|
|
9.2
|
%
|
|
(4.4
|
)%
|
|
1.8
|
%
|
|
5.6
|
%
|
Non-GAAP research and development plus capitalized software % of
revenue
|
|
15.3
|
%
|
|
15.3
|
%
|
|
15.0
|
%
|
|
14.0
|
%
|
|
14.9
|
%
|
|
14.2
|
%
|
|
13.2
|
%
|
|
14.9
|
%
|
NON-GAAP MARGIN DATA - ASC 606 (in thousands, except percentages):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross margin
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
72.9
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP sales and marketing % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
39.8
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP research and development % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
10.3
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP general and administrative % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
13.1
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP restructuring % of revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP operating margin
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
9.7
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
Non-GAAP research and development plus capitalized software % of
revenue
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
14.8
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
FOREIGN EXCHANGE RATES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP to USD average period rate
|
|
1.24
|
|
|
1.28
|
|
|
1.31
|
|
|
1.33
|
|
|
1.39
|
|
|
1.53
|
|
|
1.36
|
|
|
1.29
|
|
GBP to USD end of period spot rate
|
|
1.24
|
|
|
1.30
|
|
|
1.34
|
|
|
1.35
|
|
|
1.40
|
|
|
1.48
|
|
|
1.23
|
|
|
1.35
|
|
EUR to USD average period rate
|
|
n/a
|
|
|
1.10
|
|
|
1.18
|
|
|
1.18
|
|
|
1.23
|
|
|
n/a
|
|
|
n/a
|
|
|
1.14
|
|
EUR to USD end of period spot rate
|
|
n/a
|
|
|
1.14
|
|
|
1.18
|
|
|
1.20
|
|
|
1.23
|
|
|
n/a
|
|
|
n/a
|
|
|
1.20
|
|
|
|
|
|
1
|
|
Includes contracted clients and users of our Enterprise and
Mid-Market solution, excluding Cornerstone for Salesforce and PiiQ.
|
|
Note: As discussed on the Company's fourth quarter 2017 earnings call,
the Company reported that total billings is no longer relevant in the
assessment of its performance and beginning in the first quarter 2018,
the Company will no longer report or guide to total billings.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180508006613/en/
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