SAN MATEO, Calif., Oct. 26, 2011 /PRNewswire/ -- SuccessFactors,
Inc. (NYSE: SFSF), the global leader in Cloud-based business
execution software, today announced results for its third quarter
which ended Sept. 30, 2011.
"Our 42 percent billings growth demonstrates a vigorous and
balanced global business. We cannot hire quickly enough to meet the
demand, in what seems to be a market in its very first chapter that
we are leading. This strong growth excludes backlog which would
significantly increase our numbers. We took services off paper and
had we added that, we would be looking at nearly 50 percent
year-over-year growth which supports our growing and strategically
important 30-partner eco-system. Despite being incorporated later
than most of our pure play Cloud competitors, we believe that we
are now the largest. At our most recent satellite customer event in
San Diego, with more than 600
customers, partners and analysts in attendance, there was
validation that this market is at a tipping point. Our customers
are quickly realizing the benefits of bringing these mission
critical applications together from one trusted enterprise class
vendor. Many customers are increasing their commitments from 1-2 to
5-10 products from what in our view is the universal Business
Execution (BizX) Cloud platform by SuccessFactors. No one else
provides the breadth and depth of our universal offering, which we
built and bought with the close collaboration of our customers. Our
customers have been waiting for a credible and trusted leader in
the space," said Lars Dalgaard,
founder and CEO, SuccessFactors.
"SuccessFactors is seen as No. 1 in its market, and the
acquisition of Plateau, the leader in enterprise learning, has made
us the clear choice. This position has given us an unexpected boost
in credibility, and scalability resulting in decisions on big
projects, pipeline growth, increased partnering choices globally,
and an increase in renewals and upsell opportunities from what is
now close to 50 percent of the Fortune 500. We seem to have the
biggest Cloud user contracts everywhere, in Europe (Ex. One customer with 400,000 users),
the US (Ex. One customer), Latin
America and Asia, and what
seems to be the broadest suite in our industry. The trust
from global customers of all sizes, for us to manage some of their
most important business data in the cloud, gives us confidence to
expand rapidly beyond our current product footprint, and partner
like for instance with VMware's Cloud Foundry to extend into the
rest of the enterprise application business data layer, first
through partnering then building, investing and acquiring in the
cloud," Dalgaard continued.
Results for the Third Quarter Fiscal 2011:
- Q3 FY11 Revenue: For the quarter ended Sept. 30, 2011, GAAP revenue was $91.2 million, compared to $51.5 million in the quarter ended Sept. 30, 2010, an increase of approximately 77
percent year-over-year and an increase of 25 percent sequentially
from Q2 FY11. Non-GAAP revenue for the third quarter was
$95.1 million, compared to the
company's prior guidance of $83 million to
$84 million, and compared to $53.4
million in the quarter ended Sept.
30, 2010, an increase of approximately 78 percent
year-over-year and an increase of 30 percent sequentially from Q2
FY11.
- Q3 FY11 Operating Income (Loss): For the quarter ended
Sept. 30, 2011, the company
recognized a GAAP operating loss of $20
million, and non-GAAP operating income of $8.6 million. Non-GAAP operating income includes
$3.8 million in net impact of
acquisition related deferred revenue before fair value adjustment,
and excludes $18.8 million in
stock-based compensation expense, amortization of intangibles,
future cash consideration of acquisitions and deal related costs
and a loss of approximately $6
million of revaluation of contingent consideration for the
quarter ended Sept. 30, 2011.
- Q3 FY11 Total Deferred Revenue: Total deferred revenue
as of Sept. 30, 2011 was $243.9 million, compared to $234.4 million at Dec. 31,
2010 and up approximately 18 percent year-over-year from
$206.1 million at Sept. 30, 2010.
- Q3 FY11 Cash Flow Generated from Operations: For the
quarter ended Sept. 30, 2011, cash
flow generated from operating activities was $4 million, compared to $9.6 million in the quarter ended Sept. 30, 2010.
- Q3 FY11 Net Income (Loss) per Common Share: For the
quarter ended Sept. 30, 2011, on a
GAAP basis, net loss per common share basic and diluted was
$0.30. On a non-GAAP basis, net
income per common share, basic and diluted was $0.08 and $0.07,
respectively. Non-GAAP net income per common share, both basic and
diluted, excludes $18.8 million in
stock-based compensation expense, amortization of intangibles,
future cash consideration of acquisitions and deal-related costs,
an approximately $6 million
revaluation loss of contingent consideration related to business
combinations, and $2.7 million
unrealized foreign exchange loss on an intercompany acquisition
loan related to Inform. This compares to non-GAAP net income per
common share basic and diluted of $0.03 in the second quarter of 2011 which
excluded approximately $17.7 million
of stock-based compensation expense, amortization of intangibles,
future cash consideration of acquisitions and deal related costs, a
$10.3 million revaluation loss of
contingent consideration related to business combinations and
$1 million unrealized foreign
exchange gain on an intercompany acquisition loan related to
Inform, and approximately $16.5
million tax benefit related to Plateau Systems, and non-GAAP
net income per common share, basic and diluted, of $0.01 in the third quarter of 2010 which excluded
approximately $8.5 million of
stock-based compensation, a $3.1
million revaluation gain of contingent consideration related
to business combinations and $3.5
million unrealized foreign exchange gain on an intercompany
acquisition loan related to Inform. For the third quarter of 2011,
GAAP net loss per common share calculation assumed a weighted
average share count of approximately 83.1 million, and non-GAAP net
income per share calculation assumed a weighted basic average share
count of 83.1 million and a weighted average diluted share count of
87 million. For the third quarter of 2010, GAAP net loss per
common share calculation assumed a weighted average share count of
approximately 74.6 million, and non-GAAP net income per share
assumed a weighted average basic share count of 74.6 million and a
weighted average diluted share count of 81.7 million.
For Additional Third Quarter Fiscal 2011 Highlights please
visit: http://www.successfactors.com/press-releases/.
Guidance:
SuccessFactors is initiating guidance for its fourth quarter
fiscal 2011 and updating its outlook for the full fiscal year 2011,
as of Oct. 26, 2011.
- Q4 FY11: Non-GAAP revenue for the company's fourth
fiscal quarter is projected to be in the range of approximately
$95 million to $97 million, or an
increase of approximately 55 percent when compared to the same
period in the prior year. Non-GAAP revenue includes the effect of
deferred revenue from acquired companies that is required to be
written down for GAAP purposes under purchase accounting rules.
Non-GAAP net income per common share, basic and diluted, is
expected to be above breakeven. Non-GAAP net income per common
share estimates exclude the effects of estimated stock-based
compensation expense, amortization of intangible assets, future
cash consideration of acquisitions, deal related costs and
revaluation of contingent consideration related to business
combinations and any unrealized foreign exchange gains/losses on an
intercompany acquisition loan and assumes average weighted basic
and diluted share counts of approximately 84 million shares and
95.1 million shares, respectively.
- Full Year 2011: Non-GAAP revenue for the company's full
fiscal 2011 is now expected to be in the approximate range of
$331 million to $333 million, which
is an increase of approximately 59 percent when compared to fiscal
2010. Non-GAAP net income per common share estimates exclude the
effects of estimated stock-based compensation expense, amortization
of intangible assets, future cash consideration of acquisitions,
deal related costs and revaluation of contingent consideration
related to business combinations and any unrealized foreign
exchange gains/losses on an intercompany acquisition loan and
assumes average weighted basic and diluted share counts of
approximately 80.9 million shares and 92.1 million shares,
respectively.
Q3 FY11 Financial Results Conference Call:
SuccessFactors will host a conference call today at 2 p.m. PDT/ 5 p.m.
EDT to discuss the third quarter and fiscal 2011 financial
results with the investment community. A live webcast of the
event will be available on SuccessFactors' Investor Relations
website at http://www.successfactors.com/investor. A live
domestic dial-in is available at +1 (888) 895-8076 or +1 (973)
200-3188 internationally. A domestic replay will be available at +1
(855) 859-2056 or +1 (404) 537-3406 internationally, using passcode
14774294, and available via webcast replay until Nov. 9, 2011.
Use of Non-GAAP Financial Information:
SuccessFactors provides quarterly and annual financial
statements that are prepared in accordance with generally accepted
accounting principles (GAAP). To help understand SuccessFactors'
past financial performance and future results, SuccessFactors has
supplemented its financial results that it provides in accordance
with GAAP, with non-GAAP financial measures. The method
SuccessFactors uses to produce non-GAAP financial results is not
computed according to GAAP and may differ from the methods used by
other companies. The non-GAAP measures used by SuccessFactors in
this press release exclude the impact of stock-based compensation
expense, the amortization of intangible assets, integration costs,
future cash consideration of acquisition and deal related costs,
revaluation of contingent consideration or write-downs for
fair value accounting related to business combinations, any
unrealized foreign exchange gain/loss on an intercompany loan
related to the acquisition of Inform, and a tax benefit related to
the acquisition of Plateau Systems. The company defines billings as
GAAP revenue plus change in total deferred revenue. Non-GAAP
revenue includes revenue from acquired companies that is required
to be written down for GAAP purposes under purchase accounting
rules.
About SuccessFactors
SuccessFactors is the leading provider of cloud-based Business
Execution Software, and delivers business alignment, team
execution, people performance, and learning management solutions to
organizations of all sizes across more than 60 industries. With
approximately 15 million subscription seats globally, we strive to
delight our customers by delivering innovative solutions, content
and analytics, process expertise and best practices insights from
serving our broad and diverse customer base. Today, we have more
than 3,500 customers in more than 168 countries using our
application suite in 34 languages.
It's Time to Love Work Again.
Follow us: http://twitter.com/SuccessFactors
Like us: http://facebook.com/SuccessFactors
"Safe harbor" statement under the Private Securities Litigation
Reform Act of 1995:
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These
forward-looking statements are SuccessFactors' current expectations
and beliefs.
These forward-looking statements include statements about future
financial results and prospects. Factors that could cause actual
results to differ materially from those contemplated by these
forward-looking statements include: our ability to retain customers
and to experience high customer renewal rates; whether customers
renew their agreements for additional modules or users; pricing
pressures; our ability to sell our applications to customers of
acquired companies; our ability to sell applications of acquired
companies to our customers; the uncertain impact of the overall
global economic conditions, including on customers, prospective
customers and partners, renewal rates and length of sales cycles;
the fact that the business execution market is at an early stage of
development, and may not develop as rapidly as we anticipate; risks
related to the integration of the acquisitions, including retaining
customers and employees and managing geographically-dispersed
operations and incurring liabilities of the acquired business;
competitive factors; outages or security breaches; our ability to
develop, and market acceptance of, new services; the impact of any
discovered product defects or outages; our ability to continue to
sell our services outside the HR area; our ability to manage our
growth; our ability to successfully expand our sales force and its
effectiveness; whether our resellers and other partners will be
successful in marketing our products; our ability to continue to
manage expenses; the impact of unforeseen expenses, including as a
result of integrating acquisitions; and general economic conditions
worldwide. If any such risks or uncertainties materialize or if any
of the assumptions proves incorrect, our results could differ
materially from the results expressed or implied by the
forward-looking statements we make.
Further information on these and other factors that could affect
these forward-looking statements is included in the section
entitled "Risk Factors" in our Annual Report on Form 10-K and in
our most recent report on Form 10-Q and in other filings we make
with the Securities and Exchange Commission from time to time.
SuccessFactors,
Inc.
|
|
Condensed
Consolidated Balance Sheets
|
|
(unaudited,
in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
September 30,
|
|
As of
December 31,
|
|
|
|
2011
|
|
2010
|
|
|
|
(unaudited)
|
|
(1)
|
|
Assets:
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
94,553
|
|
$
75,384
|
|
Marketable
securities
|
|
153,778
|
|
281,073
|
|
Accounts receivable, net
of allowance for doubtful accounts
|
|
76,725
|
|
80,440
|
|
Deferred
commissions
|
|
6,766
|
|
7,106
|
|
Prepaid expenses and other
current assets
|
|
13,960
|
|
8,022
|
|
Total current
assets
|
|
345,782
|
|
452,025
|
|
Restricted cash
|
|
1,744
|
|
913
|
|
Property and equipment,
net
|
|
14,971
|
|
8,737
|
|
Deferred commissions, less
current portion
|
|
10,004
|
|
12,854
|
|
Goodwill
|
|
258,415
|
|
64,077
|
|
Intangible assets
|
|
97,598
|
|
37,832
|
|
Other assets
|
|
1,886
|
|
975
|
|
Total
assets
|
|
$
730,400
|
|
$
577,413
|
|
|
|
|
|
|
|
Liabilities and stockholders'
equity:
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts
payable
|
|
$
4,503
|
|
$
7,254
|
|
Accrued expenses and other
current liabilities
|
|
23,124
|
|
11,433
|
|
Accrued employee
compensation
|
|
24,940
|
|
23,467
|
|
Deferred
revenue
|
|
233,212
|
|
219,868
|
|
Notes payable
|
|
876
|
|
-
|
|
Acquisition-related
contingent considerations
|
|
-
|
|
5,200
|
|
Total current
liabilities
|
|
286,655
|
|
267,222
|
|
|
|
|
|
|
|
Deferred revenue, less current
portion
|
|
10,706
|
|
14,577
|
|
Notes payable, less current
portion
|
|
1,444
|
|
-
|
|
Long-term income taxes
payable
|
|
2,620
|
|
1,987
|
|
Acquisition-related contingent
considerations, less current portion
|
|
27,022
|
|
21,050
|
|
Other long-term
liabilities
|
|
2,937
|
|
1,248
|
|
Total
liabilities
|
|
331,384
|
|
306,084
|
|
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
Common stock
|
|
84
|
|
77
|
|
Additional paid-in
capital
|
|
658,807
|
|
499,343
|
|
Accumulated other
comprehensive income
|
|
2,218
|
|
3,258
|
|
Accumulated
deficit
|
|
(262,093)
|
|
(231,349)
|
|
Total stockholders’
equity
|
|
399,016
|
|
271,329
|
|
|
|
|
|
|
|
Total
liabilities and stockholders’ equity
|
|
$
730,400
|
|
$
577,413
|
|
|
|
|
|
|
|
(1) The condensed
consolidated balance sheet as of December 31, 2010 has been derived
from the audited financial statements as of that date, but does not
include all of the information and footnotes required by accounting
principles generally accepted in the United States for complete
financial statements.
|
|
|
|
|
|
|
SuccessFactors,
Inc.
|
|
Condensed
Consolidated Statement of Operations
|
|
(unaudited,
in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
Subscription and
support
|
|
$
65,863
|
|
$
42,079
|
|
$
172,174
|
|
$
117,030
|
|
Professional services and
other
|
|
25,373
|
|
9,457
|
|
59,510
|
|
28,744
|
|
Total revenue
|
|
91,236
|
|
51,536
|
|
231,684
|
|
145,774
|
|
Cost of revenue (1)
|
|
|
|
|
|
|
|
|
|
Subscription and
support
|
|
17,466
|
|
7,331
|
|
38,877
|
|
18,238
|
|
Professional services and
other
|
|
15,245
|
|
9,143
|
|
38,291
|
|
20,562
|
|
Total cost of
revenue
|
|
32,711
|
|
16,474
|
|
77,168
|
|
38,800
|
|
Total gross profit
|
|
58,525
|
|
35,062
|
|
154,516
|
|
106,974
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
(1)
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
38,735
|
|
25,166
|
|
106,093
|
|
69,585
|
|
Research and
development
|
|
18,242
|
|
11,048
|
|
47,533
|
|
27,699
|
|
General and
administrative
|
|
15,585
|
|
9,180
|
|
44,303
|
|
24,877
|
|
Revaluation of contingent
considerations
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
Gain on settlement of
litigation, net
|
|
-
|
|
-
|
|
(2,906)
|
|
-
|
|
Total operating
expenses
|
|
78,538
|
|
42,338
|
|
199,643
|
|
119,105
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
(20,013)
|
|
(7,276)
|
|
(45,127)
|
|
(12,131)
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized foreign exchange gain
(loss) on intercompany loan
|
|
(2,669)
|
|
3,453
|
|
(1,168)
|
|
3,453
|
|
Interest income (expense) and
other, net
|
|
(1,782)
|
|
1,301
|
|
(490)
|
|
765
|
|
Loss before benefit for
(provision of) income taxes
|
|
(24,464)
|
|
(2,522)
|
|
(46,785)
|
|
(7,913)
|
|
|
|
|
|
|
|
|
|
|
|
Benefit for (provision of)
income taxes
|
|
(557)
|
|
(292)
|
|
16,041
|
|
(486)
|
|
Net loss
|
|
$
(25,021)
|
|
$
(2,814)
|
|
$
(30,744)
|
|
$
(8,399)
|
|
Net loss per common share, basic
and diluted
|
|
$
(0.30)
|
|
$
(0.04)
|
|
$
(0.38)
|
|
$
(0.11)
|
|
Shares used in computing net
loss per common share, basic and diluted*
|
|
83,136
|
|
74,618
|
|
79,883
|
|
73,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_____________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Amounts include stock-based
compensation expense, amortization of intangibles, future cash
consideration of acquisitions, and due diligence and integration
costs as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
Cost of revenue
|
|
$
6,108
|
|
$
2,322
|
|
$
12,524
|
|
$
3,602
|
|
Sales and marketing
|
|
4,621
|
|
2,408
|
|
12,482
|
|
6,157
|
|
Research and
development
|
|
3,331
|
|
975
|
|
7,110
|
|
2,572
|
|
General and
administrative
|
|
4,733
|
|
2,815
|
|
15,438
|
|
5,736
|
|
|
|
$
18,793
|
|
$
8,520
|
|
$
47,554
|
|
$
18,067
|
|
|
|
|
|
|
|
|
|
|
|
* Excludes 561,883 shares held
in escrow in connection with Inform and Cubetree
acquisitions
|
|
|
|
|
|
|
|
|
|
|
SuccessFactors,
Inc.
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
(unaudited,
in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
With
Adoption
|
|
|
|
With
Adoption
|
|
|
|
|
|
of ASU
2009-13
|
|
|
|
of ASU
2009-13
|
|
Cash flow from operating
activities:
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$ (25,021)
|
|
$
(2,814)
|
|
$ (30,744)
|
|
$
(8,399)
|
|
Adjustments to reconcile
net loss to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
2,238
|
|
1,469
|
|
5,851
|
|
4,074
|
|
Loss on
retirement/impairment of fixed asset
|
|
-
|
|
76
|
|
-
|
|
76
|
|
Amortization of deferred
commissions
|
|
4,341
|
|
2,227
|
|
12,620
|
|
6,552
|
|
Stock-based compensation
expense
|
|
12,404
|
|
5,841
|
|
29,495
|
|
15,388
|
|
Amortization of intangible
assets
|
|
4,620
|
|
1,482
|
|
8,184
|
|
1,482
|
|
Loss (gain) on revaluation
of contingent consideration
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
Unrealized foreign
exchange loss (gain) on intercompany loan
|
|
2,669
|
|
(3,453)
|
|
1,168
|
|
(3,453)
|
|
Income tax benefit in
connection with acquisitions
|
|
-
|
|
-
|
|
(16,541)
|
|
-
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
(2,526)
|
|
(8,113)
|
|
13,805
|
|
3,278
|
|
Deferred
commissions
|
|
(4,442)
|
|
(4,457)
|
|
(9,429)
|
|
(8,666)
|
|
Prepaid expenses and other
current assets
|
|
1,328
|
|
(1,628)
|
|
5,852
|
|
(2,813)
|
|
Other assets
|
|
329
|
|
327
|
|
1,863
|
|
(218)
|
|
Accounts
payable
|
|
(1,304)
|
|
305
|
|
(3,060)
|
|
585
|
|
Accrued expenses and other
current liabilities
|
|
(2,941)
|
|
2,000
|
|
5,751
|
|
2,470
|
|
Accrued employee
compensation
|
|
3,137
|
|
4,710
|
|
653
|
|
1,314
|
|
Long-term income taxes
payable
|
|
143
|
|
152
|
|
282
|
|
36
|
|
Other
liabilities
|
|
450
|
|
208
|
|
(7,364)
|
|
(8)
|
|
Deferred
revenue
|
|
2,625
|
|
14,285
|
|
(416)
|
|
20,855
|
|
Net cash provided by
operating activities
|
|
4,026
|
|
9,561
|
|
22,590
|
|
29,497
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from investing
activities:
|
|
|
|
|
|
|
|
|
|
Restricted cash
|
|
4
|
|
(14)
|
|
(2)
|
|
(2)
|
|
Advances to principal
shareholders of Inform
|
|
-
|
|
2,175
|
|
-
|
|
-
|
|
Capital
expenditures
|
|
(1,885)
|
|
(1,414)
|
|
(4,925)
|
|
(3,196)
|
|
Proceeds from sale of
assets
|
|
-
|
|
-
|
|
-
|
|
1
|
|
Acquisitions, net of cash
acquired
|
|
(5,000)
|
|
(26,089)
|
|
(135,296)
|
|
(26,089)
|
|
Purchases of
available-for-sale securities
|
|
(78,420)
|
|
(127,092)
|
|
(124,703)
|
|
(272,733)
|
|
Proceeds from maturities
of available-for-sale securities
|
|
37,725
|
|
62,250
|
|
140,721
|
|
154,353
|
|
Proceeds from sales of
available-for-sale securities
|
|
18,017
|
|
53,256
|
|
109,914
|
|
96,500
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing
activities
|
|
(29,559)
|
|
(36,928)
|
|
(14,291)
|
|
(51,166)
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from financing
activities:
|
|
|
|
|
|
|
|
|
|
Offering costs
|
|
-
|
|
-
|
|
-
|
|
(111)
|
|
Proceeds from exercise of
stock options, net
|
|
4,122
|
|
6,215
|
|
15,096
|
|
10,948
|
|
Principal payments on
contingent consideration
|
|
(4,000)
|
|
-
|
|
(4,000)
|
|
-
|
|
Net cash provided by
financing activities
|
|
122
|
|
6,215
|
|
11,096
|
|
10,837
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes
on cash and cash equivalents
|
|
(803)
|
|
1,053
|
|
(226)
|
|
786
|
|
Net (decrease) increase in cash
and cash equivalents
|
|
(26,214)
|
|
(20,099)
|
|
19,169
|
|
(10,046)
|
|
Cash and cash equivalents at
beginning of period
|
|
120,767
|
|
86,671
|
|
75,384
|
|
76,618
|
|
Cash and cash equivalents at end
of period
|
|
$ 94,553
|
|
$
66,572
|
|
$ 94,553
|
|
$
66,572
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash
transactions:
|
|
|
|
|
|
|
|
|
|
Common stock issued and
stock options and restricted stock units assumed in connection with
acquisitions
|
|
$
-
|
|
$
31,796
|
|
$ 116,055
|
|
$
31,796
|
|
Purchase of software
licenses
|
|
363
|
|
-
|
|
2,906
|
|
-
|
|
|
|
|
|
|
|
|
|
|
SuccessFactors,
Inc.
|
|
Reconciliation of GAAP to
Non-GAAP Measures
|
|
(unaudited,
in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Revenue
|
|
|
|
|
|
|
|
|
|
|
GAAP Revenue
|
|
$ 91,236
|
|
$ 51,536
|
|
$ 231,684
|
|
$ 145,774
|
|
|
(a) Net impact of acquisition
related deferred revenue before fair value adjustment
|
|
3,877
|
|
1,892
|
|
4,529
|
|
1,892
|
|
|
Non-GAAP Revenue
|
|
$ 95,113
|
|
$ 53,428
|
|
$ 236,213
|
|
$ 147,666
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Billings
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP Revenue
|
|
$ 91,236
|
|
$ 51,536
|
|
$ 231,684
|
|
$ 145,774
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending total deferred
revenue
|
|
243,918
|
|
206,087
|
|
243,918
|
|
206,087
|
|
|
Less: Beginning total
deferred revenue
|
|
241,679
|
|
188,194
|
|
234,445
|
|
181,624
|
|
|
Less: Beginning total
deferred revenue from acquisitions
|
|
-
|
|
3,573
|
|
9,888
|
|
3,573
|
|
|
Change in total deferred
revenue
|
|
2,239
|
|
14,320
|
|
(415)
|
|
20,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Billings (revenue plus change in
total deferred revenue)
|
|
$ 93,475
|
|
$ 65,856
|
|
$ 231,269
|
|
$ 166,664
|
|
|
|
|
|
|
|
|
|
|
|
|
Billings profit and margin
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
Billings
|
|
$ 93,475
|
|
$ 65,856
|
|
$ 231,269
|
|
$ 166,664
|
|
|
Non-GAAP total cost of revenue
and operating expenses (total spend)
|
|
86,480
|
|
53,348
|
|
224,637
|
|
142,894
|
|
|
Billings profit
|
|
$
6,995
|
|
$ 12,508
|
|
$
6,632
|
|
$ 23,770
|
|
|
Billings margin
|
|
7%
|
|
19%
|
|
3%
|
|
14%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) and net income
(loss) per share reconciliations:
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss
|
|
$ (25,021)
|
|
$ (2,814)
|
|
$ (30,744)
|
|
$ (8,399)
|
|
|
(a) Net impact of acquisition
related deferred revenue before fair value adjustment
|
|
3,877
|
|
1,892
|
|
4,529
|
|
1,892
|
|
|
(b) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions, and due diligence and integration costs
|
|
18,793
|
|
8,520
|
|
47,554
|
|
18,067
|
|
|
(c) Revaluation of contingent
considerations
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
|
(d) Foreign exchange unrealized
loss (gain) on intercompany acquisition loan related to
Inform
|
|
2,669
|
|
(3,453)
|
|
1,168
|
|
(3,453)
|
|
|
(e) Tax benefit related to
Jambok and Plateau
|
|
-
|
|
-
|
|
(17,692)
|
|
-
|
|
|
Non-GAAP net income excluding
stock-based compensation expense and other items
|
|
$
6,294
|
|
$
1,089
|
|
$
9,435
|
|
$
5,051
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss per common share -
basic and diluted
|
|
$
(0.30)
|
|
$
(0.04)
|
|
$
(0.38)
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income per common
share (excluding stock-based compensation expense and other items)
- basic
|
|
$
0.08
|
|
$
0.01
|
|
$
0.12
|
|
$
0.07
|
|
|
Non-GAAP net income per common
share (excluding stock-based compensation expense and other items)
- diluted
|
|
$
0.07
|
|
$
0.01
|
|
$
0.11
|
|
$
0.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP shares used in computing
net loss per common share, basic
|
|
83,136
|
|
74,618
|
|
79,883
|
|
73,100
|
|
|
GAAP shares used in computing
net loss per common share, diluted
|
|
87,020
|
|
81,681
|
|
84,194
|
|
80,009
|
|
|
|
|
|
|
|
|
|
|
|
|
Total spend
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP total cost of revenue and
operating expenses
|
|
$ 111,249
|
|
$ 58,812
|
|
$ 276,811
|
|
$ 157,905
|
|
|
(b) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions, and due diligence and integration costs
|
|
18,793
|
|
8,520
|
|
47,554
|
|
18,067
|
|
|
(c) Revaluation of contingent
considerations
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
|
Non-GAAP total cost of revenue
and operating expenses (total spend)
|
|
$ 86,480
|
|
$ 53,348
|
|
$ 224,637
|
|
$ 142,894
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit and gross margin
reconciliations:
|
|
|
|
|
|
|
|
|
|
|
GAAP gross profit
|
|
$ 58,525
|
|
$ 35,062
|
|
$ 154,516
|
|
$ 106,974
|
|
|
(a) Net impact of acquisition
related deferred revenue before fair value adjustment
|
|
3,877
|
|
1,892
|
|
4,529
|
|
1,892
|
|
|
(b1) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions and integration costs
|
|
6,108
|
|
2,322
|
|
12,524
|
|
3,602
|
|
|
Non-GAAP gross
profit
|
|
$ 68,510
|
|
$ 39,276
|
|
$ 171,569
|
|
$ 112,468
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross margin
percentage
|
|
64%
|
|
68%
|
|
67%
|
|
73%
|
|
|
Non-GAAP gross margin
percentage
|
|
72%
|
|
74%
|
|
73%
|
|
76%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP cost of revenue
|
|
$ 32,711
|
|
$ 16,474
|
|
$ 77,168
|
|
$ 38,800
|
|
|
(b1) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions and integration costs
|
|
6,108
|
|
2,322
|
|
12,524
|
|
3,602
|
|
|
Non-GAAP cost of
revenue
|
|
$ 26,603
|
|
$ 14,152
|
|
$ 64,644
|
|
$ 35,198
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
|
$ 78,538
|
|
$ 42,338
|
|
$ 199,643
|
|
$ 119,105
|
|
|
(b2) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions and integration costs
|
|
12,685
|
|
6,198
|
|
35,030
|
|
14,465
|
|
|
(c) Revaluation of contingent
considerations
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
|
Non-GAAP operating
expenses
|
|
$ 59,877
|
|
$ 39,196
|
|
$ 159,993
|
|
$ 107,696
|
|
|
|
|
|
|
|
|
|
|
|
|
Total sales and marketing
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP sales and
marketing
|
|
$ 38,735
|
|
$ 25,166
|
|
$ 106,093
|
|
$ 69,585
|
|
|
(b3) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions and integration costs
|
|
4,621
|
|
2,408
|
|
12,482
|
|
6,157
|
|
|
Non-GAAP sales and
marketing
|
|
$ 34,114
|
|
$ 22,758
|
|
$ 93,611
|
|
$ 63,428
|
|
|
|
|
|
|
|
|
|
|
|
|
Total research and development
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP research and
development
|
|
$ 18,242
|
|
$ 11,048
|
|
$ 47,533
|
|
$ 27,699
|
|
|
(b4) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions and integration costs
|
|
3,331
|
|
975
|
|
7,110
|
|
2,572
|
|
|
Non-GAAP research and
development
|
|
$ 14,911
|
|
$ 10,073
|
|
$ 40,423
|
|
$ 25,127
|
|
|
|
|
|
|
|
|
|
|
|
|
Total general and administrative
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP general and administrative
expenses
|
|
$ 15,585
|
|
$ 9,180
|
|
$ 44,303
|
|
$ 24,877
|
|
|
(b5) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions, and due diligence and integration costs
|
|
4,733
|
|
2,815
|
|
15,438
|
|
5,736
|
|
|
Non-GAAP general and
administrative
|
|
$ 10,852
|
|
$
6,365
|
|
$ 28,865
|
|
$ 19,141
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating margin
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
GAAP loss from
operations
|
|
$ (20,013)
|
|
$ (7,276)
|
|
$ (45,127)
|
|
$ (12,131)
|
|
|
(a) Net impact of acquisition
related deferred revenue before fair value adjustment
|
|
3,877
|
|
1,892
|
|
4,529
|
|
1,892
|
|
|
(b) Stock-based compensation
expense, amortization of intangibles, future cash consideration of
acquisitions, and due diligence and integration costs
|
|
18,793
|
|
8,520
|
|
47,554
|
|
18,067
|
|
|
(c) Revaluation of contingent
considerations
|
|
5,976
|
|
(3,056)
|
|
4,620
|
|
(3,056)
|
|
|
Non-GAAP income from operations
less stock-based compensation and other items
|
|
$
8,633
|
|
$
80
|
|
$ 11,576
|
|
$
4,772
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Revenue
|
|
$ 95,113
|
|
$ 53,428
|
|
$ 236,213
|
|
$ 147,666
|
|
|
Non-GAAP operating margin
percentage
|
|
9%
|
|
0%
|
|
5%
|
|
3%
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow
reconciliation:
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating
activities
|
|
$ 4,026
|
|
$ 9,561
|
|
$ 22,590
|
|
$ 29,497
|
|
|
Less: Capital
expenditures
|
|
(1,885)
|
|
(1,414)
|
|
(4,925)
|
|
(3,196)
|
|
|
Free cash flow
|
|
$
2,141
|
|
$
8,147
|
|
$ 17,665
|
|
$ 26,301
|
|
|
|
|
|
|
|
|
|
|
|
Contact:
For investor inquiries:
Karen Moran
+1-650.645.4439
kmoran@successfactors.com
For media inquiries:
Andrea Meyer
+1-415.370.7329
ameyer@successfactors.com
SOURCE SuccessFactors, Inc.