CyberArk Announces Record Revenue and Strong Fourth Quarter and Full Year 2017 Results
Fourth quarter record total revenue of $80.4 million increased 25% year-over-year
Full year record total revenue of $261.7 million increased 21% year-over-year
Full year record cash flow from operations of $80.7 million increased 43% year-over-year
NEWTON, Mass. & PETACH TIKVA, Israel – Feb. 15, 2018 –CyberArk, (NASDAQ: CYBR), the company that protects organizations from cyber attacks that have made their way inside the network perimeter, today announced financial results for the fourth quarter and year ended December 31, 2017.
“The fourth quarter represented a strong finish to 2017 and we were pleased to deliver record revenue and cash flow from operations with strong operating margins,” said Udi Mokady, CyberArk Chairman and CEO. “Our results demonstrate the healthy demand for our solutions across companies of all sizes and vertical markets. During the fourth quarter, we introduced enhancements to our Privileged Account Security solution that strengthened our leadership position as the most comprehensive solution across on-premises, hybrid and cloud environments as well as DevOps. As we look ahead, we remain focused on creating long term shareholder value by delivering sustainable, profitable growth.”
Financial Highlights for the Fourth Quarter Ended December 31, 2017
- Total revenue was $80.4 million, up 25% compared with the fourth quarter of 2016.
- License revenue was $48.6 million, up 19% compared with the fourth quarter of 2016.
- Maintenance and Professional Services revenue was $31.8 million, up 35% compared with the fourth quarter of 2016.
- GAAP operating income was $11.6 million, compared to $13.2 million in the fourth quarter of 2016. Non-GAAP operating income was $19.7 million, compared to $19.4 million in the fourth quarter of 2016.
- GAAP net income was $3.6 million, or $0.10 per diluted share, compared to GAAP net income of $10.2 million, or $0.28 per diluted share, in the fourth quarter of 2016. Non-GAAP net income was $15.0 million, or $0.41 per diluted share, compared to $14.7 million, or $0.41 per diluted share, in the fourth quarter of 2016.
Financial Highlights for the Full Year Ended December 31, 2017
- Total revenue was $261.7 million, up 21% compared with 2016.
- License revenue was $147.6 million, up 12% compared with 2016.
- Maintenance and Professional Services revenue was $114.1 million, up 34% compared with 2016.
- GAAP operating income was $20.3 million, compared to $36.0 million in 2016. Non-GAAP operating income was $51.9 million, compared to $58.0 million in 2016.
- GAAP net income $16.0 million, or $0.44 per diluted share, compared to GAAP net income of $28.1 million, or $0.78 per diluted share, in 2016. Non-GAAP net income was $41.9 million, or $1.16 per diluted share, compared to $45.2 million, or $1.26 per diluted share, in 2016.
The tables at the end of this press release include a reconciliation of GAAP to non-GAAP gross profit, operating income and net income for the three and twelve months ended December 31, 2017 and 2016. An explanation of these measures is also included below under the heading “Non-GAAP Financial measures.”
Balance Sheet and Cash Flow From Operations:
- As of December 31, 2017, CyberArk had $330.3 million in cash, cash equivalents, marketable securities and short-term deposits. This compares with $296.8 million in cash, cash equivalents, marketable securities and short-term deposits as of September 30, 2017 and $295.5 million as of December 31, 2016.
- As of December 31, 2017, total deferred revenue was $105.2 million, a 43% increase from $73.5 million at December 31, 2016.
- During 2017, the Company generated $80.7 million in cash flow from operations, a 43% increase compared to $56.3 million during in 2016.
Based on information available as of February 15, 2018, CyberArk is issuing guidance for the first quarter and full year 2018 as indicated below.
First Quarter 2018:
- Total revenue is expected to be in the range of $68.25 million to $69.75 million, which represents 16% to 18% year-over-year growth.
- Non-GAAP operating income is expected to be in the range of $9.2 million to $10.4 million.
- Non-GAAP net income per share is expected to be in the range of $0.19 to $0.22 per share. This assumes 36.5 million weighted average diluted shares.
Full Year 2018:
- Total revenue is expected to be in the range of $312.0 million to $316.0 millionwhich represents 19% to 21% year-over-year growth.
- Non-GAAP operating income is expected to be in the range of $54.5 million to $57.5 million.
- Non-GAAP net income per share is expected to be in the range of $1.18 to $1.24 per share. This assumes 36.7 million weighted average diluted shares.
Conference Call Information
In conjunction with this announcement, CyberArk will host a conference call on Thursday, February 15, 2018 at 8:30 a.m. Eastern Time (ET) to discuss the company’s fourth quarter and year end 2017 financial results and its business outlook. To access this call, dial +1 844-237-3590 (U.S.) or +1 484-747-6582 (international). The conference ID is 8986489. Additionally, a live webcast of the conference call will be available via the “Investor Relations” section of the company’s web site at cyberarkvx.staging.wpengine.com.
Following the conference call, a replay will be available for one week at +1 855-859-2056 (U.S.) or +1 404-537-3406 (international). The replay pass code is 8986489. An archived webcast of the conference call will also be available in the “Investor Relations” section of the company’s web site at cyberarkvx.staging.wpengine.com.
CyberArk (NASDAQ: CYBR) is the global leader in privileged account security, a critical layer of IT security to protect data, infrastructure and assets across the enterprise, in the cloud and throughout the DevOps pipeline. CyberArk delivers the industry’s most complete solution to reduce risk created by privileged credentials and secrets. The company is trusted by the world’s leading organizations, including more than 50 percent of the Fortune 100, to protect against external attackers and malicious insiders. A global company, CyberArk is headquartered in Petach Tikva, Israel, with U.S. headquarters located in Newton, Mass. The company also has offices throughout the Americas, EMEA, Asia Pacific and Japan. To learn more about CyberArk, visit cyberarkvx.staging.wpengine.com, read the CyberArk blogs or follow on Twitter via @CyberArk, LinkedIn or Facebook.
Copyright © 2018 CyberArk Software. All Rights Reserved. All other brand names, product names, or trademarks belong to their respective holders.
Non-GAAP Financial Measures
CyberArk believes that the use of non-GAAP gross profit, non-GAAP operating income and non-GAAP net income is helpful to our investors. These financial measures are not measures of the Company’s financial performance under U.S. GAAP and should not be considered as alternatives to operating income or net income or any other performance measures derived in accordance with GAAP.
The Company believes that providing non-GAAP financial measures that exclude share-based compensation, acquisition related expenses, facility exit costs, amortization of intangible assets related to acquisitions and the one-time impact of the US Tax Cuts and Jobs Act of 2017 allows for more meaningful comparisons of its period to period operating results. Share-based compensation expense has been and will continue to be for the foreseeable future, a significant recurring expense in the Company’s business and an important part of the compensation provided to its employees. Share based compensation expense has varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expense. The Company believes that expenses related to its acquisitions, facility exit costs, amortization of intangible assets related to acquisitions and the one-time impact of the US Tax Cuts and Jobs Act of 2017, do not reflect the performance of its core business and impact period-to-period comparability.
Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures as they exclude expenses that may have a material impact on the Company’s reported financial results. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP. CyberArk urges investors to review the reconciliation of its non-GAAP financial measures to the comparable U.S. GAAP financial measures included below, and not to rely on any single financial measures to evaluate its business.
Cautionary Language Concerning Forward-Looking Statements
This release may contain forward-looking statements, which express the current beliefs and expectations of CyberArk’s (the “Company”) management. In some cases, forward-looking statements may be identified by terminology such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,” “potential” or the negative of these terms or other similar expressions. Such statements involve a number of known and unknown risks and uncertainties that could cause the Company’s future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: changes in the rapidly evolving cyber threat landscape; failure to effectively manage growth; near-term declines in our operating and net profit margins and our revenue growth rate; real or perceived shortcomings, defects or vulnerabilities in the Company’s solutions or internal network system, or the failure of the Company’s customers or channel partners to correctly implement the Company’s solutions; fluctuations in quarterly results of operations; the inability to acquire new customers or sell additional products and services to existing customers; competition from IT security vendors; the Company’s ability to successfully integrate recent and or future acquisitions; and other factors discussed under the heading “Risk Factors” in the Company’s most recent annual report on Form 20-F filed with the Securities and Exchange Commission. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.