Bulletin
Investor Alert

New York Markets Close in:

press release

Aug. 7, 2019, 7:01 a.m. EDT

CyberArk Announces Strong Second Quarter 2019 Results

Second quarter total revenue of $100.2 million increases 29% year-over-yearGAAP operating income of $13.0 million and non-GAAP operating income of $26.5 millionCompany Announces Chief Revenue Officer Transition

CyberArk , /zigman2/quotes/206810080/composite CYBR +0.85% , the global leader in privileged access security , today announced strong financial results for the second quarter ended June 30, 2019.

“We were pleased that our results exceeded expectations across all guided metrics,” said Udi Mokady, CyberArk Chairman and CEO. “Every region contributed to our strong growth and we were thrilled to sign more than 200 new logos in the second quarter. Our innovation not only sets the standard for Privileged Access Security but also strengthens our leadership position in the market. With our strong first half of 2019, we are pleased to increase our guidance for the full year on both the top and bottom line.”

Financial Highlights for the Second Quarter Ended June 30, 2019

Revenue:

  • Total revenue was $100.2 million, up 29% compared with the second quarter of 2018.

  • License revenue was $52.2 million, up 27% compared with the second quarter of 2018.

  • Maintenance and professional services revenue was $48.0 million, up 31% compared with the second quarter of 2018.

Operating Income:

  • GAAP operating income was $13.0 million, an increase from $7.0 million in the second quarter of 2018. Non-GAAP operating income was $26.5 million, an increase from $17.0 million in the second quarter of 2018.

Net Income:

  • GAAP net income was $13.4 million, or $0.34 per diluted share, an increase from GAAP net income of $8.4 million, or $0.23 per diluted share, in the second quarter of 2018. Non-GAAP net income was $23.0 million, or $0.59 per diluted share, an increase from $13.5 million, or $0.36 per diluted share, in the second quarter of 2018.

The tables at the end of this press release include a reconciliation of GAAP to non-GAAP gross margin, operating income and net income for the three months and six months ended June 30, 2019 and 2018. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

Balance Sheet and Cash Flow:

  • As of June 30, 2019, CyberArk had $537.9 million in cash, cash equivalents, marketable securities and short-term deposits. This compares to $451.2 million as of December 31, 2018 and $377.5 million at June 30, 2018.

  • As of June 30, 2019, total deferred revenue was $174.2 million, a 34% increase from $129.6 million at June 30, 2018.

  • During the six months ended June 30, 2019, the Company generated $67.3 million in cash flow from operations, a 20% increase from $56.2 million in the first six months of 2018.

Business Outlook

Based on information available as of August 7, 2019, CyberArk is issuing guidance for the third quarter and increasing its guidance for the full year 2019 as indicated below.

Third Quarter 2019:

  • Total revenue between $102.0 million and $104.0 million, representing 20% to 23% year-over-year growth.

  • Non-GAAP operating income between $21.75 million and $23.25 million.

  • Non-GAAP net income per share between of $0.45 and $0.48 per diluted share.

Full Year 2019:

  • Total revenue between $419.0 million and $423.0 million, representing 22% to 23% year-over-year growth.

  • Non-GAAP operating income between $106.0 million and $109.0 million.

  • Non-GAAP net income per share between $2.24 and $2.30 per diluted share.

Chief Revenue Officer Transition Ron Zoran, CyberArk’s Chief Revenue Officer, plans to transition from the Company to pursue other business opportunities, including assisting early stage technology companies as a board member. Ron will continue to serve as Chief Revenue Officer of CyberArk through September 30, 2019 and to help ensure a smooth transition, he will also continue to serve as an advisor into the first quarter of 2020. The Company has initiated a search to identify a new global head of sales.

“Ron was one of the very first employees of CyberArk and has provided invaluable technology and sales leadership over the years,” continued Mr. Mokady. “On behalf of the Company and the Board, I want to thank him for his significant contributions to the company, which have been instrumental in helping establish CyberArk as the leader in Privileged Access Security. We wish Ron all the best in his future pursuits and believe his extensive experience will be valuable to emerging technology companies. Ron has built an exceptional sales organization that is well positioned to capitalize on the opportunities ahead of us. We appreciate his commitment to the Company, support and leadership during this transition period.”

“CyberArk has provided me with significant opportunities including being part of the world’s most talented and progressive team of security professionals extending across CyberArk executives, employees, customers and partners,” stated Ron Zoran, CyberArk Chief Revenue Officer. “My decision to leave the Company was difficult, but at this stage of my career I want to leverage my experience to scale and grow early stage technology companies. Given my long tenure at the company and strong personal relationships with the entire team, I remain fully engaged to ensure a smooth transition.”

Conference Call Information CyberArk will host a conference call today, August 7, 2019 at 8:30 a.m. Eastern Time (ET) to discuss the company’s second quarter financial results and its business outlook. To access this call, dial +1 877-823-7693 (U.S.) or +1 647-689-4543 (international). The conference ID is 6476456. Additionally, a live webcast of the conference call will be available via the “Investor Relations” section of the company’s website at www.cyberark.com .

Following the conference call, a replay will be available for one week at +1 800-585-8367 (U.S.) or +1 416-621-4642 (international). The replay pass code is 6476456. An archived webcast of the conference call will also be available in the “Investor Relations” section of the company’s website at www.cyberark.com .

About CyberArk CyberArk (NASDAQ: CYBR ) is the global leader in privileged access 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 500, 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 www.cyberark.com , read the CyberArk blogs or follow on Twitter via @CyberArk , LinkedIn or Facebook .

Copyright © 2019 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 gross profit, operating income or net income or any other performance measures derived in accordance with GAAP.

  • Non-GAAP gross profit is calculated as gross profit excluding share-based compensation expense and amortization of intangible assets related to acquisitions.

  • Non-GAAP operating income is calculated as operating income excluding share-based compensation expense, acquisition related expenses and amortization of intangible assets related to acquisitions.

  • Non-GAAP net income is calculated as net income excluding share-based compensation expense, acquisition related expenses, amortization of intangible assets related to acquisitions and the tax effect of the non-GAAP adjustments.

The Company believes that providing non-GAAP financial measures that exclude share-based compensation, acquisition related expenses, amortization of intangible assets related to acquisitions and the tax effect of the non-GAAP adjustments 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 a variety of equity instruments that can impact a company’s non-cash expense. The Company believes that expenses related to its acquisitions, amortization of intangible assets related to acquisitions and the tax effect of the non-GAAP adjustments 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 measure to evaluate its business.

Guidance for non-GAAP financial measures excludes, as applicable, share-based compensation expense, acquisition related expenses, amortization of intangible assets related to acquisitions and the tax effect of the non-GAAP adjustments. A reconciliation of the non-GAAP financial measures guidance to the corresponding GAAP measures is not available on a forward-looking basis due to the uncertainty regarding, and the potential variability and significance of, the amounts of share-based compensation expense, amortization of intangible assets related to acquisitions, and the non-recurring expenses that are excluded from the guidance. Accordingly, a reconciliation of the non-GAAP financial measures guidance to the corresponding GAAP measures for future periods is not available without unreasonable effort.

Cautionary Language Concerning Forward-Looking Statements This release contains 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; potential 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, channel partners, managed security service providers, or contractors to correctly implement, manage and maintain 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 a wide variety of 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.

CYBERARK SOFTWARE LTD.
 Consolidated Statements of Operations 
 U.S. dollars in thousands (except per share data)
(Unaudited)
                     
      Three Months Ended   Six Months Ended  
      June 30,   June 30,  
      2018   2019   2018   2019
                     
  Revenues:                  
  License    $         41,121    $        52,201    $          79,615    $          103,485  
  Maintenance and professional services               36,592              47,980               69,881                 92,631  
                     
  Total revenues               77,713            100,181              149,496               196,116  
                     
  Cost of revenues:                  
  License                 2,510                2,906                 4,907                   5,494  
  Maintenance and professional services                 9,198              12,305               18,089                 23,284  
                     
  Total cost of revenues               11,708              15,211               22,996                 28,778  
                     
  Gross profit                66,005              84,970              126,500               167,338  
                     
  Operating expenses:                  
  Research and development               13,808              16,995               26,792                 33,326  
  Sales and marketing               35,521              43,573               70,103                 85,078  
  General and administrative                 9,714              11,426               18,613                 22,331  
                     
  Total operating expenses               59,043              71,994              115,508               140,735  
                     
  Operating income                 6,962              12,976               10,992                 26,603  
                     
  Financial income, net                    225                2,485                 2,066                   3,906  
                     
  Income before taxes on income                 7,187              15,461               13,058                 30,509  
                     
  Tax benefit (taxes on income)                 1,190               (2,058)                 1,740                  (3,429)  
                     
  Net income    $           8,377    $        13,403    $          14,798    $           27,080  
                     
                     
  Basic net income per ordinary share    $             0.23    $            0.36    $             0.41    $               0.73  
  Diluted net income per ordinary share    $             0.23    $            0.34    $             0.40    $               0.70  
                     
  Shares used in computing net income                  
  per ordinary shares, basic          36,001,580        37,522,410         35,724,717           37,285,788  
  Shares used in computing  net income                  
  per ordinary shares, diluted         36,923,520        38,993,170         36,680,585           38,735,078  
                     
                     
                     
                     
  Share-based Compensation Expense:                  
                     
      Three Months Ended   Six Months Ended  
      June 30,   June 30,  
      2018   2019   2018   2019  
                     
                     
  Cost of revenues    $              758    $          1,251    $           1,413    $             2,208  
  Research and development                 2,007                2,394                 3,511                   4,701  
  Sales and marketing                 2,874                4,878                 5,291                   8,563  
  General and administrative                 2,774                3,373                 5,121                   6,676  
                     
  Total share-based compensation expense    $           8,413    $        11,896    $          15,336    $           22,148  
                     
                     
                     
                     

 

 CYBERARK SOFTWARE LTD.  
 Consolidated Balance Sheets  
 U.S. dollars in thousands  
 (Unaudited)
      December 31,   June 30,
      2018   2019
           
           
ASSETS          
           
CURRENT ASSETS:        
Cash and cash equivalents    $       260,636    $       341,738
Short-term bank deposits             106,399               97,566
Marketable securities              59,948               59,279
Trade receivables                48,431               45,275
Prepaid expenses and other current assets                6,349               10,876
           
Total current assets             481,763             554,734
           
LONG-TERM ASSETS:        
Property and equipment, net              15,120               15,790
Intangible assets, net              14,732               11,556
Goodwill                82,400               82,400
Marketable securities              24,261               39,328
Other long-term assets              31,863               60,690
Deferred tax asset              23,481               25,046
           
Total long-term assets             191,857             234,810
           
TOTAL ASSETS      $       673,620    $       789,544
           
LIABILITIES AND SHAREHOLDERS' EQUITY        
           
CURRENT LIABILITIES:        
Trade payables      $          4,924    $           4,615
Employees and payroll accruals              32,853               30,577
Accrued expenses and other current liabilities              13,271               20,157
Deferred revenues              92,375             106,921
           
Total current liabilities             143,423             162,270
           
LONG-TERM LIABILITIES:        
Deferred revenues              57,159               67,268
Other long-term liabilities                6,268               25,718
           
Total long-term liabilities              63,427               92,986
           
TOTAL LIABILITIES             206,850             255,256
           
SHAREHOLDERS' EQUITY:        
Ordinary shares of NIS 0.01 par value                     95                     98
Additional paid-in capital             303,900             342,618
Accumulated other comprehensive income (loss)                  (939)                   778
Retained earnings             163,714             190,794
           
Total shareholders' equity             466,770             534,288
           
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY  $       673,620    $       789,544

 

CYBERARK SOFTWARE LTD.
Consolidated Statements of Cash Flows
U.S. dollars in thousands
(Unaudited)
         
    Six Months Ended
    June 30,
    2018   2019
         
 Cash flows from operating activities:        
 Net income    $        14,798    $      27,080
 Adjustments to reconcile net income to net cash        
 provided by operating activities:        
 Depreciation and amortization                4,676             5,551
 Amortization of premium and accretion of discount on marketable securities, net                  208                 (42)
 Share-based compensation              15,336           22,148
 Deferred income taxes, net               (4,710)            (1,857)
 Decrease in trade receivables              12,357             3,156
 Increase in prepaid expenses and other current and long-term assets               (6,138)            (9,656)
 Increase (decrease) in trade payables                2,003               (123)
 Increase in short-term and long-term deferred revenues              27,845           24,655
 Decrease in employees and payroll accruals               (5,168)            (7,595)
 Increase (decrease) in accrued expenses and other        
 current and long-term liabilities               (4,983)             4,029
         
 Net cash provided by operating activities              56,224           67,346
         
 Cash flows from investing activities:        
 Proceeds from short and long term deposits                7,775             8,948
 Investment in marketable securities             (30,563)          (50,464)
 Proceeds from maturities of marketable securities              20,114           36,653
 Purchase of property and equipment               (4,098)            (3,231)
 Payments for business acquisitions, net of cash acquired             (18,450)               -  
         
 Net cash used in investing activities             (25,222)            (8,094)
         
 Cash flows from financing activities:        
 Proceeds from withholding tax related to employee stock plans                 5,509             5,319
 Proceeds from exercise of stock options                8,090           16,572
         
 Net cash provided by financing activities              13,599           21,891
         
 Increase in cash, cash equivalents and restricted cash              44,601           81,143
         
 Cash, cash equivalents and restricted cash at the beginning of the period   162,521          261,883
         
 Cash, cash equivalents and restricted cash at the end of the period    $      207,122    $    343,026

 

CYBERARK SOFTWARE LTD.
 Reconciliation of GAAP Measures to Non-GAAP Measures
 U.S. dollars in thousands (except per share data)
(Unaudited)
                     
                     
                     
   Reconciliation of Gross Profit to Non-GAAP Gross Profit:                
                     
      Three Months Ended   Six Months Ended  
      June 30,   June 30,  
      2018   2019   2018   2019  
                     
   Gross profit    $           66,005    $        84,970    $   126,500    $   167,338  
   Plus:                  
   Share-based compensation - Maintenance & professional services                   758                1,251            1,413            2,208  
   Amortization of intangible assets - License                  1,444                1,444            2,674            2,888  
                     
   Non-GAAP gross profit    $           68,207    $        87,665    $   130,587    $   172,434  
                     
                     
                     
                     
                     
   Reconciliation of Operating Income to Non-GAAP Operating Income:              
                     
      Three Months Ended   Six Months Ended  
      June 30,   June 30,  
      2018   2019   2018   2019  
             
                     
   Operating income    $            6,962    $        12,976    $     10,992    $     26,603  
   Plus:                  
   Share-based compensation                  8,413              11,896          15,336          22,148  
   Amortization of intangible assets - Cost of revenues                1,444                1,444            2,674            2,888  
   Amortization of intangible assets -  Sales and marketing                   199                   144               397               288  
   Acquisition related expenses                       -                       -                 268                 -    
                     
   Non-GAAP operating income    $           17,018    $        26,460    $     29,667    $     51,927  
                     
                     
   Reconciliation of Net Income to Non-GAAP Net Income:                
                     
      Three Months Ended   Six Months Ended  
      June 30,   June 30,  
      2018   2019   2018   2019  
             
                     
   Net income    $            8,377    $        13,403    $     14,798    $     27,080  
   Plus:                  
   Share-based compensation                  8,413              11,896          15,336          22,148  
   Amortization of intangible assets - Cost of revenues                1,444                1,444            2,674            2,888  
   Amortization of intangible assets -  Sales and marketing                   199                   144               397               288  
   Acquisition related expenses                       -                       -                 268                 -    
   Taxes on income related to non-GAAP adjustments               (4,964)               (3,846)           (8,193)           (7,892)  
                     
   Non-GAAP net income    $           13,469    $        23,041    $     25,280    $     44,512  
                     
   Non-GAAP net income per share                  
   Basic    $              0.37    $            0.61    $        0.71    $        1.19  
   Diluted    $              0.36    $            0.59    $        0.69    $        1.15  
                     
   Weighted average number of shares                  
   Basic          36,001,580        37,522,410    35,724,717    37,285,788  
   Diluted          36,923,520        38,993,170    36,680,585    38,735,078  
                     

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20190807005339/en/

SOURCE: CyberArk

Investors:
Erica Smith
CyberArk
Phone: +1- 617-558-2132
ir@cyberark.com Media:
Liz Campbell
CyberArk
Phone: +1-617-558-2191
press@cyberark.com

Copyright Business Wire 2019

/zigman2/quotes/206810080/composite
US : U.S.: Nasdaq
$ 120.53
+1.02 +0.85%
Volume: 124,239
Dec. 10, 2019 12:01p
P/E Ratio
69.61
Dividend Yield
N/A
Market Cap
$4.53 billion
Rev. per Employee
$299,476
loading...

Comtex
Link to MarketWatch's Slice.