– Q2 total revenue grew 7% year-over-year to $94.3 million
– Q2 GAAP earnings per share of $0.03, and non-GAAP earnings per share of $0.17
– Total active subscribers increased 17% to over 348,000
CAMPBELL, Calif., Oct. 10, 2017 — /BackupReview.info/ — Barracuda Networks, Inc. (NYSE: CUDA), a leading provider of cloud-enabled security and data protection solutions, today announced results for its second quarter fiscal 2018 that ended August 31, 2017.
“We delivered a strong second quarter achieving core billings growth of 22% year-over-year and gross billings of $108.5 million, which was above our guidance. Our performance was driven by continued traction in the areas of the market where we have been investing, especially email and public cloud security, and we are pleased to see that our efforts are generating stronger top-line results,” said BJ Jenkins, president and CEO. “Excluding non-core billings, we have generated four consecutive quarters of double-digit billings growth. We believe we have the right strategy in place, are focused on the right areas of the market, and provide innovative security solutions that are affordable and consumable in the form that is best suited for our customers’ needs.”
Second Quarter Fiscal 2018 Financial Summary
The reconciliation between non-GAAP and their most closely comparable GAAP equivalent is contained in the tables below.
Recent Company Highlights
Conference Call Information
Barracuda will host a conference call and corresponding live webcast at 1:30 p.m. PT today. To access the conference call, dial 1-855-560-2573 for the U.S. or 1-412-542-4159 for international callers. The webcast will be available live on the investor relations section of the company’s website at investors.barracuda.com, and via replay beginning approximately one hour after the completion of the call for a period of one year. An audio replay of the call will be available to investors beginning at approximately 5:00 p.m. PT today through Oct. 17, 2017 by dialing 1-877-344-7529 in the U.S. or 1-412-317-0088 for international callers, and entering conference ID 10111827. Additional supplemental financial information will also be accessible on the company’s website at investors.barracuda.com.
Forward-Looking Statements
This announcement contains forward-looking statements related to our strategy and core products, the adoption of our cloud and security and data protection products, our MSP products, and the potential benefits from newly launched and updated products to customers and partners, and potential results from new initiatives, channels and go-to-market strategies that involve risks and uncertainties, including statements regarding our expectations regarding financial performance, and the potential impact of our new and updated products. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including, but not limited to: fluctuations in demand for our products and services; a highly competitive and evolving business environment for network security and storage solutions; the company’s effectiveness in controlling expenses and timing of infrastructure costs; the effects of significant developments in IT infrastructure deployments, particularly cloud computing; the impact of foreign currency fluctuations; the possibility that we might experience delays in the development of new technology and products; risks related to recent or future acquisitions; customer response to our new technology and products; risks related to pending or future litigation and regulatory matters; a dependency on third parties for certain components of our products and the impact of changes in our management team. The company undertakes no obligation to update the forward-looking information in this release. More information about potential factors that could affect our business and financial results is included in our filings with the Securities and Exchange Commission, including, without limitation, under the captions: “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Risk Factors,” which are on file with the Securities and Exchange Commission.
Non-GAAP Financial Measures
Barracuda provides all financial information required in accordance with generally accepted accounting principles (GAAP). To supplement our consolidated financial statements presented in accordance with GAAP, we are also providing with this press release and on our conference call with non-GAAP net income, non-GAAP operating income, non-GAAP gross margins, non-GAAP operating expenses, adjusted EBITDA and free cash flow. In preparing our non-GAAP information, we have excluded certain amounts as set forth in the attached financial tables and footnotes. We believe that excluding these items provides both management and investors with additional insight into our current operations and the trends affecting the company. In particular, management finds it useful to exclude these items in order to more readily correlate the company’s operating activities with the company’s ability to generate cash from operations. Accordingly, management uses these non-GAAP measures, along with the comparable GAAP information, in evaluating our historical performance and in planning our future business activities. Please note that our non-GAAP measures may be different than those used by other companies. The additional non-GAAP financial information we present should be considered in conjunction with, and not as a substitute for, our financial information presented in accordance with GAAP. We have provided reconciliations of these non-GAAP measures to their comparable GAAP measures for the periods presented in this release, which exclude certain amounts as set forth in the attached financial tables and footnotes for these periods. These measures should only be used to evaluate the company’s results of operations in conjunction with the corresponding GAAP measures for comparable financial information and understanding of the company’s ongoing performance as a business. Barracuda uses both GAAP and non-GAAP measures to evaluate and manage its operations.
Beginning in the third quarter of fiscal 2017, we modified our reporting practices and our historical presentation of adjusted EBITDA and free cash flow. We no longer adjust for changes in deferred revenue and associated deferred costs in our calculation of adjusted EBITDA, and for free cash flow we will not adjust for the cash payment impact of acquisition and other charges. Prior period information has been recast to conform to the adjusted calculations.
Forward-looking non-GAAP financial measures included in Barracuda’s guidance exclude amortization of intangible assets, stock-based compensation expense, acquisition and other charges, income tax effects related to such exclusions and other expense (income) adjustments. Barracuda does not provide reconciliations of its forward-looking non-GAAP financial measures to the corresponding GAAP measures due to the high variability of, and difficulty in making accurate forecasts and projections with respect to, the items excluded from these non-GAAP financial measures. In particular, stock-based compensation and related taxes are impacted by the company’s future hiring and retention needs, as well as the future fair market value of its common stock, all of which is difficult to predict and subject to constant change. Accordingly, reconciliations of its forward-looking non-GAAP financial measures to the corresponding GAAP measures are not available without unreasonable effort. The actual amounts of these excluded items will have a significant impact on the company’s GAAP operating income (loss) and net income (loss) per diluted share.
About Barracuda Networks, Inc. (NYSE: CUDA)
Barracuda (NYSE: CUDA) simplifies IT with cloud-enabled solutions that empower customers to protect their networks, applications and data, regardless of where they reside. These powerful, easy-to-use and affordable solutions are trusted by more than 150,000 organizations worldwide and are delivered in appliance, virtual appliance, cloud and hybrid deployment configurations. Barracuda’s customer-centric business model focuses on delivering high-value, subscription-based IT solutions that provide end-to-end network and data protection. For additional information, please visit barracuda.com.
Barracuda Networks, Barracuda, and the Barracuda Networks logo are registered trademarks of Barracuda Networks, Inc. in the US and other countries.
Contacts:
Investor Relations: Maria Riley; +1 415-217-7722; ir@barracuda.com
Corporate Communications: Mary Catherine Petermann; +1 404-307-6290; mc@barracuda.com
Barracuda Networks, Inc. | |||||||
Condensed Consolidated Balance Sheets | |||||||
(in thousands) | |||||||
(Unaudited) | |||||||
As of August 31,2017 (1) | As of February 28,2017 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 125,585 | $ | 120,194 | |||
Marketable securities | 80,991 | 79,915 | |||||
Accounts receivable, net of allowance for doubtful accounts | 40,899 | 40,560 | |||||
Inventories, net | 6,520 | 5,847 | |||||
Deferred costs | 34,206 | 32,598 | |||||
Other current assets | 10,473 | 16,295 | |||||
Total current assets | 298,674 | 295,409 | |||||
Property and equipment, net | 32,043 | 29,979 | |||||
Deferred costs, non-current | 30,246 | 27,285 | |||||
Deferred income taxes, non-current | 1,023 | 1,554 | |||||
Other non-current assets | 15,320 | 8,607 | |||||
Intangible assets, net | 28,692 | 32,145 | |||||
Goodwill | 70,653 | 69,795 | |||||
Total assets | $ | 476,651 | $ | 464,774 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 7,710 | $ | 11,439 | |||
Accrued payroll and related benefits | 12,825 | 13,593 | |||||
Other accrued liabilities | 10,773 | 12,942 | |||||
Deferred revenue | 245,517 | 239,796 | |||||
Note payable | — | 4,115 | |||||
Total current liabilities | 276,825 | 281,885 | |||||
Long-term liabilities: | |||||||
Deferred revenue, non-current | 168,148 | 167,286 | |||||
Deferred income taxes, non-current | 3,073 | 2,803 | |||||
Other long-term liabilities | 6,776 | 6,377 | |||||
Stockholders’ equity: | |||||||
Common stock | 53 | 53 | |||||
Additional paid-in capital | 384,395 | 370,745 | |||||
Accumulated other comprehensive loss | (3,076) | (5,226) | |||||
Accumulated deficit | (359,543) | (359,149) | |||||
Total stockholders’ equity | 21,829 | 6,423 | |||||
Total liabilities and stockholders’ equity | $ | 476,651 | $ | 464,774 |
(1) | As of March 1, 2017, we adopted ASU 2016-09 which allowed for an accounting policy election to either estimate the number of share-based awards that are expected to vest or account for forfeitures when they occur. We elected to account for forfeitures when they occur and adopted this change on a modified retrospective basis. As a result, we recorded the cumulative effect of the change as a $0.4 million increase to the March 1, 2017 opening accumulated deficit balance on the condensed consolidated balance sheets. |
For detailed financial report, visit: https://goo.gl/GPfxyG
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