Exhibit 99.1
CONTACTS: Dominic Paschel SuccessFactors, Inc. Global Public & Investor Relations 415-262-4641 dpaschel@successfactors.com |
SuccessFactors Announces Record Third Quarter Fiscal 2010 Results
• | Billings grow to $65.9 million, an increase of 32% year-over-year |
• | Non-GAAP revenues grow to $53.4 million, an increase of 38% year-over-year |
• | Cash flow from operations grows to $13 million, an increase of 264% year-over-year |
• | Raises 2010 non-GAAP revenue guidance from $198 million to $200 million, to $203.2 million to $203.7 million |
SAN MATEO, Calif. – November 02, 2010 –SuccessFactors, Inc. (NASDAQ: SFSF) today announced results for its third quarter fiscal 2010 which ended September 30, 2010.
“We believe the era of Business Execution Software is here. In Q3 2010, SuccessFactors saw strong performance from our sales organization with impressive transactions from current and new customers, contributing to all-time high in quarterly billings at $65.9 million, which grew 32% year-over-year – we were really proud we broke above 30%. It feels really strong, a lot harder to do 30% than 10% and 20%, each point is so hard given the denominator has become large, we are just so proud of the team,” said Lars Dalgaard, founder and CEO for SuccessFactors.
“SuccessFactors also hit an all-time high in quarterly non-GAAP revenue at $53.4 million growing 38% year-over-year. SuccessFactors posted record 3rd quarter cash flow from operations of $13 million, expanding 264% year-over-year. And SuccessFactors billings margin expanded from 12% in Q210 to 19% in Q310.
“SuccessFactors continues to see increased adoption and tangible value generated to customers using our software. Our leadership in the new category of Business Execution Software, which we created, is fueling our growth.”
Results for the Third Quarter Fiscal 2010:
• | Q3 FY10 Non-GAAP Revenue: For the quarter ended September 30, 2010, non-GAAP revenue was $53.4 million, compared to the company’s prior guidance of $52.5 million to $53.5 million, and compared to $38.7 million in the quarter ended September 30, 2009, an increase of approximately 38% year-over-year and an increase of 8% sequentially from Q210. |
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• | Q3 FY10 Non-GAAP Operating Profit: For the quarter ended September 30, 2010, non-GAAP operating profit was $80,000. Non-GAAP operating profit excludes approximately $8.5 million in stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs and a $3.1 million revaluation of contingent consideration for the quarter ended September 30, 2010. |
• | Q3 FY10 Total Deferred Revenue: Total deferred revenue as of September 30, 2010 was $206.1 million, up approximately 10% sequentially from $188.2 million at June 30, 2010 and up approximately 28% year-over-year from $161.0 million at September 30, 2009. |
• | Q3 FY10 Cash Flow Generated from Operations: For the quarter ended September 30, 2010, cash flow generated from operating activities was $13 million, up approximately 264% from $3.6 for the quarter ended September 30, 2009. |
• | Q3 FY10 Net Income (Loss) per Common Share: On a GAAP basis, for the quarter ended September 30, 2010, net loss per common share, basic and diluted, was $(0.04). Non-GAAP net income per common share, basic and diluted was $0.01, which excludes approximately $8.5 million in stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs, $3.1 million revaluation of contingent consideration related to business combinations and a $3.5 million unrealized foreign exchange gain on an intercompany acquisition loan related to Inform, compared to breakeven at $0.00 in Q210 which excluded approximately $4.5 million of stock-based compensation and $0.01 in Q309 which excluded approximately $2.6 million of stock-based compensation. For the third quarter of 2010, GAAP and non-GAAP net income (loss) per common share calculations assume average weighted basic and diluted share counts of approximately 74.6 million shares and 81.7 million shares, respectively. |
For Additional Third Quarter Fiscal 2010 Highlights please visit:
http://www.successfactors.com/press-releases/
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Guidance:
SuccessFactors is raising guidance for full fiscal year 2010 and initiating guidance for its fourth quarter fiscal 2010, as of November 2nd, 2010.
• | Q4 FY10: Non-GAAP revenue for the company’s fourth fiscal quarter is projected to be in the range of approximately $55.5 million to $56.0 million. Note that 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 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, integration 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 75.9 million shares and 82.9 million shares, respectively. |
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• | Full Year 2010: Non-GAAP revenue for the company’s full fiscal 2010 is now expected to be in the approximate range of $203.2 million to $203.7 million, raised from the non-GAAP revenue range of approximately $198 million to $200 million given going into in Q310 which was raised from the approximate GAAP range of $178 million to $180 million going into 2010. The company now expects non-GAAP net income per common share for fiscal 2010 to be between $0.06 and $0.07 from prior guidance of around 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, integration 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 73.8 million shares and 80.8 million shares, respectively. |
Q310 Financial Results Conference Call:
SuccessFactors will host a conference call today at 2:00 p.m. (PT) / 5:00 p.m. (ET) to discuss the third quarter fiscal 2010 financial results with the investment community. A live web broadcast of the event will be available on SuccessFactors’ Investor Relations website athttp://www.successfactors.com/investor. A live domestic dial-in is available at (877) 398-2615 or (702) 495-1086 internationally. A domestic replay will be available at (800) 642-1687 or (706) 645-9291 internationally, passcode 16437811, and available via webcast replay until November 19th, 2010.
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 and any revaluation of contingent consideration or write-downs for fair value accounting related to business combinations and any unrealized foreign exchange gain/loss on an intercompany loan related to the acquisition of Inform. The company defines bookings or billings as 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.
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About SuccessFactors, Inc.
SuccessFactors is a global leader in Business Execution Software. The SuccessFactors Business Execution (BizX) Suite, which is delivered through the cloud, improves business alignment, team execution and people performance to drive results for companies of all sizes. Across 168 countries and 34 languages, more than 8 million users and 3,000 companies leverage SuccessFactors every day, up from approximately 300,000 users and 100 companies in 2003. BizX bridges the gap between strategy and success by allowing every person in an organization to execute against their goals better and faster. SuccessFactors’ recent acquisitions ofYouCalc,Inform andCubeTree supplement SuccessFactors’ core BizX strategy with solutions that align with SuccessFactors’ mission of helping companies get work done by delivering robust business insights and improved collaboration. To learn more, visit:www.successfactors.com.
Execution Is The Difference(TM)
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“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 expected non-GAAP revenue, non-GAAP net income, impact of acquisitions and product performance. 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; 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 both the business execution and the social business markets are 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; 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.
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Further information on these and other factors that could affect our financial results 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.
These documents are or will be available in the SEC Filings section of the Investor Relations section of our website atwww.successfactors.com/investor. Information on our website is not part of this release.
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SuccessFactors, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
As of September 30, 2010 | As of December 31, 2009 | |||||||
(unaudited) | (1) | |||||||
Assets: | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 66,572 | $ | 76,618 | ||||
Marketable securities | 267,782 | 246,629 | ||||||
Accounts receivable, net of allowance for doubtful accounts | 56,118 | 57,611 | ||||||
Deferred commissions | 6,329 | 5,950 | ||||||
Prepaid expenses and other current assets | 8,671 | 5,679 | ||||||
Total current assets | 405,472 | 392,487 | ||||||
Restricted cash | 1,033 | 931 | ||||||
Property and equipment, net | 6,992 | 5,787 | ||||||
Deferred commissions, less current portion | 10,968 | 9,233 | ||||||
Goodwill | 63,041 | — | ||||||
Intangible assets | 38,253 | — | ||||||
Other assets | 477 | 259 | ||||||
Total assets | $ | 526,236 | $ | 408,697 | ||||
Liabilities and stockholders’ equity: | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 2,328 | $ | 794 | ||||
Accrued expenses and other current liabilities | 11,074 | 7,220 | ||||||
Accrued employee compensation | 16,468 | 14,546 | ||||||
Deferred revenue | 190,119 | 160,356 | ||||||
Contingent consideration | 5,557 | — | ||||||
Total current liabilities | 225,546 | 182,916 | ||||||
Capital lease obligations, less current portion | 45 | — | ||||||
Deferred revenue, less current portion | 15,968 | 21,268 | ||||||
Long-term taxes payable | 1,678 | 1,643 | ||||||
Contingent consideration, less current portion | 25,209 | — | ||||||
Other long-term liabilities | 1,009 | 367 | ||||||
Total liabilities | 269,455 | 206,194 | ||||||
Stockholders’ equity: | ||||||||
Common stock | 76 | 72 | ||||||
Additional paid-in capital | 480,986 | 421,419 | ||||||
Accumulated other comprehensive income | 3,017 | (89 | ) | |||||
Accumulated deficit | (227,298 | ) | (218,899 | ) | ||||
Total stockholders’ equity | 256,781 | 202,503 | ||||||
Total liabilities and stockholders’ equity | $ | 526,236 | $ | 408,697 | ||||
(1) | The condensed consolidated balance sheet as of December 31, 2009 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 Statements of Operations
(unaudited, in thousands, except per share data)
Three Months Ended | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
March 31, | June 30, | |||||||||||||||||||||||
2010 | 2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||||
With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | |||||||||||||||||||||
Revenue | ||||||||||||||||||||||||
Subscription and support | $ | 36,145 | $ | 38,370 | $ | 41,638 | $ | 30,595 | $ | 116,153 | $ | 87,857 | ||||||||||||
Professional services and other | 8,590 | 11,133 | 9,898 | 8,090 | 29,621 | 22,988 | ||||||||||||||||||
Total revenue | 44,735 | 49,503 | 51,536 | 38,685 | 145,774 | 110,845 | ||||||||||||||||||
Cost of revenue (1) | ||||||||||||||||||||||||
Subscription and support | 5,297 | 5,991 | 7,613 | 4,539 | 18,901 | 12,699 | ||||||||||||||||||
Professional services and other | 5,292 | 5,746 | 8,861 | 4,292 | 19,899 | 12,568 | ||||||||||||||||||
Total cost of revenue | 10,589 | 11,737 | 16,474 | 8,831 | 38,800 | 25,267 | ||||||||||||||||||
Total gross profit | 34,146 | 37,766 | 35,062 | 29,854 | 106,974 | 85,578 | ||||||||||||||||||
Operating expenses: (1) | ||||||||||||||||||||||||
Sales and marketing | 22,242 | 22,177 | 25,166 | 19,573 | 69,585 | 59,125 | ||||||||||||||||||
Research and development | 7,725 | 8,926 | 11,048 | 6,343 | 27,699 | 17,967 | ||||||||||||||||||
General and administrative | 7,494 | 8,203 | 9,180 | 6,016 | 24,877 | 18,542 | ||||||||||||||||||
Revaluation of contingent consideration | — | — | (3,056 | ) | — | (3,056 | ) | — | ||||||||||||||||
Total operating expenses | 37,461 | 39,306 | 42,338 | 31,932 | 119,105 | 95,634 | ||||||||||||||||||
Loss from operations | (3,315 | ) | (1,540 | ) | (7,276 | ) | (2,078 | ) | (12,131 | ) | (10,056 | ) | ||||||||||||
Interest income (expense) and other, net | (268 | ) | (268 | ) | 4,754 | 210 | 4,218 | 823 | ||||||||||||||||
Loss before provision for income taxes | (3,583 | ) | (1,808 | ) | (2,522 | ) | (1,868 | ) | (7,913 | ) | (9,233 | ) | ||||||||||||
Provision for income taxes | (127 | ) | (67 | ) | (292 | ) | (104 | ) | (486 | ) | (742 | ) | ||||||||||||
Net loss | $ | (3,710 | ) | $ | (1,875 | ) | $ | (2,814 | ) | $ | (1,972 | ) | $ | (8,399 | ) | $ | (9,975 | ) | ||||||
Net loss per common share, basic and diluted | $ | (0.05 | ) | $ | (0.03 | ) | $ | (0.04 | ) | $ | (0.03 | ) | $ | (0.11 | ) | $ | (0.18 | ) | ||||||
Shares used in computing net loss per common share, basic* and diluted | 72,008 | 72,645 | 74,618 | 57,292 | 73,100 | 56,791 | ||||||||||||||||||
(1) Amounts include stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs as follows: |
| |||||||||||||||||||||||
Three Months Ended | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
March 31, | June 30, | |||||||||||||||||||||||
2010 | 2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||||
Cost of revenue | $ | 603 | $ | 677 | $ | 2,322 | $ | 291 | $ | 3,602 | $ | 989 | ||||||||||||
Sales and marketing | 1,955 | 1,794 | 2,408 | 1,143 | 6,157 | 3,233 | ||||||||||||||||||
Research and development | 875 | 722 | 975 | 312 | 2,572 | 904 | ||||||||||||||||||
General and administrative | 1,593 | 1,328 | 2,815 | 815 | 5,736 | 2,293 | ||||||||||||||||||
$ | 5,026 | $ | 4,521 | $ | 8,520 | $ | 2,561 | $ | 18,067 | $ | 7,419 | |||||||||||||
* | 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 | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
March 31, | June 30, | September 30, | September 30, | |||||||||||||||||||||
2010 | 2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||||
With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | With Adoption of ASU 2009-13 | |||||||||||||||||||||
Cash flow from operating activities: | ||||||||||||||||||||||||
Net loss | $ | (3,710 | ) | $ | (1,875 | ) | $ | (2,814 | ) | $ | (1,972 | ) | $ | (8,399 | ) | $ | (9,975 | ) | ||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||||||||||||||
Depreciation and amortization | 1,273 | 1,332 | 1,469 | 955 | 4,074 | 2,915 | ||||||||||||||||||
Gain (loss) on retirement/impairment of fixed asset | — | — | 76 | 2 | 76 | (63 | ) | |||||||||||||||||
Amortization of deferred commissions | 2,100 | 2,225 | 2,227 | 1,785 | 6,552 | 5,399 | ||||||||||||||||||
Stock-based compensation expense | 5,026 | 4,521 | 5,841 | 2,561 | 15,388 | 7,419 | ||||||||||||||||||
Amortization of intangibles | — | — | 1,482 | — | 1,482 | — | ||||||||||||||||||
Revaluation of contingent consideration | — | — | (3,056 | ) | — | (3,056 | ) | — | ||||||||||||||||
Changes in assets and liabilities: | ||||||||||||||||||||||||
Accounts receivable | 15,149 | (3,758 | ) | (8,113 | ) | (6,864 | ) | 3,278 | 1,584 | |||||||||||||||
Deferred commissions | (1,892 | ) | (2,317 | ) | (4,457 | ) | (3,375 | ) | (8,666 | ) | (5,837 | ) | ||||||||||||
Prepaid expenses and other current assets | (1,508 | ) | 323 | (1,628 | ) | (2,587 | ) | (2,813 | ) | (3,771 | ) | |||||||||||||
Other assets | (396 | ) | (149 | ) | 327 | (220 | ) | (218 | ) | (324 | ) | |||||||||||||
Accounts payable | (335 | ) | 615 | 305 | (444 | ) | 585 | (1,751 | ) | |||||||||||||||
Accrued expenses and other current liabilities | 244 | 226 | 2,000 | 443 | 2,470 | (2,135 | ) | |||||||||||||||||
Accrued employee compensation | (6,024 | ) | 2,628 | 4,710 | 1,880 | 1,314 | 1,961 | |||||||||||||||||
Long-term taxes payable | (35 | ) | (81 | ) | 152 | 249 | 36 | 555 | ||||||||||||||||
Other liabilities | (87 | ) | (129 | ) | 208 | (28 | ) | (8 | ) | 8 | ||||||||||||||
Deferred revenue | 3,326 | 3,244 | 14,285 | 11,193 | 20,855 | 11,219 | ||||||||||||||||||
Net cash provided by operating activities | 13,131 | 6,805 | 13,014 | 3,578 | 32,950 | 7,204 | ||||||||||||||||||
Cash flow from investing activities: | ||||||||||||||||||||||||
Restricted cash | 3 | 9 | (14 | ) | 173 | (2 | ) | 197 | ||||||||||||||||
Prepaid acquisition costs | — | (2,175 | ) | 2,175 | — | — | — | |||||||||||||||||
Capital expenditures | (632 | ) | (1,150 | ) | (1,414 | ) | (1,176 | ) | (3,196 | ) | (1,524 | ) | ||||||||||||
Proceeds from sale of assets | 1 | — | — | — | 1 | 88 | ||||||||||||||||||
Acquisitions, net of cash acquired | — | — | (26,089 | ) | — | (26,089 | ) | — | ||||||||||||||||
Purchases of available-for-sale securities | (34,459 | ) | (111,182 | ) | (127,092 | ) | (34,330 | ) | (272,733 | ) | (112,957 | ) | ||||||||||||
Proceeds from maturities of available-for-sale securities | 26,100 | 66,003 | 62,250 | 34,185 | 154,353 | 73,989 | ||||||||||||||||||
Proceeds from sales of available-for-sale securities | 20,000 | 23,244 | 53,256 | — | 96,500 | 546 | ||||||||||||||||||
Net cash provided by (used in) investing activities | 11,013 | (25,251 | ) | (36,928 | ) | (1,148 | ) | (51,166 | ) | (39,661 | ) | |||||||||||||
Cash flow from financing activities: | ||||||||||||||||||||||||
Offering costs | — | (111 | ) | — | — | (111 | ) | — | ||||||||||||||||
Proceeds from exercise of stock options, net | 1,936 | 2,797 | 6,215 | 1,469 | 10,948 | 3,518 | ||||||||||||||||||
Principal payments on capital lease obligations | 10 | (10 | ) | — | (9 | ) | — | (27 | ) | |||||||||||||||
Net cash provided by financing activities | 1,946 | 2,676 | 6,215 | 1,460 | 10,837 | 3,491 | ||||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (104 | ) | (163 | ) | (2,400 | ) | 83 | (2,667 | ) | 145 | ||||||||||||||
Net increase (decrease) in cash and cash equivalents | 25,986 | (15,933 | ) | (20,099 | ) | 3,973 | (10,046 | ) | (28,821 | ) | ||||||||||||||
Cash and cash equivalents at beginning of period | 76,618 | 102,604 | 86,671 | 37,065 | 76,618 | 69,859 | ||||||||||||||||||
Cash and cash equivalents at end of period | $ | 102,604 | $ | 86,671 | $ | 66,572 | $ | 41,038 | $ | 66,572 | $ | 41,038 | ||||||||||||
SuccessFactors, Inc.
Reconciliation of GAAP to Non-GAAP Measures
(unaudited, in thousands, except per share data)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Non-GAAP Revenue | ||||||||||||||||
Revenue | $ | 51,536 | $ | 38,685 | $ | 145,774 | $ | 110,845 | ||||||||
(a) Net impact of acquisition related deferred revenue before fair value adjustment | 1,892 | — | 1,892 | — | ||||||||||||
Non-GAAP Revenue | $ | 53,428 | $ | 38,685 | $ | 147,666 | $ | 110,845 | ||||||||
Bookings reconciliation: | ||||||||||||||||
GAAP Revenue | $ | 51,536 | $ | 38,685 | $ | 145,774 | $ | 110,845 | ||||||||
Ending total deferred revenue | 206,087 | 161,016 | 206,087 | 161,016 | ||||||||||||
Less: Beginning total deferred revenue | 188,194 | 149,824 | 181,624 | 149,798 | ||||||||||||
Less: Beginning total deferred revenue from acquisitions | 3,573 | — | 3,573 | — | ||||||||||||
Change in total deferred revenue | 14,320 | 11,192 | 20,890 | 11,218 | ||||||||||||
Bookings (revenue plus change in total deferred revenue) | $ | 65,856 | $ | 49,877 | $ | 166,664 | $ | 122,063 | ||||||||
Billings profit and margin reconciliation: | ||||||||||||||||
Billings revenue | $ | 65,856 | $ | 49,877 | $ | 166,664 | $ | 122,063 | ||||||||
Non-GAAP total cost of revenue and operating expenses (total spend) | 53,348 | 38,202 | 142,895 | 113,482 | ||||||||||||
Billings profit | $ | 12,508 | $ | 11,675 | $ | 23,769 | $ | 8,581 | ||||||||
Billings margin | 19 | % | 23 | % | 14 | % | 7 | % | ||||||||
Net loss and net loss per share reconciliations: | ||||||||||||||||
GAAP net loss | $ | (2,814 | ) | $ | (1,972 | ) | $ | (8,399 | ) | $ | (9,975 | ) | ||||
(a) Net impact of acquisition related deferred revenue before fair value adjustment | 1,892 | — | 1,892 | — | ||||||||||||
(b) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 8,520 | 2,561 | 18,066 | 7,419 | ||||||||||||
(c) Revaluation of contingent consideration | (3,056 | ) | — | (3,056 | ) | — | ||||||||||
(d) Foreign exchange unrealized gain on intercompany acquisition loan related to Inform | (3,464 | ) | — | (3,464 | ) | — | ||||||||||
Non-GAAP net income (loss) excluding stock-based compensation expense and other items | $ | 1,078 | $ | 589 | $ | 5,039 | $ | (2,556 | ) | |||||||
GAAP net loss per common share - basic and diluted | $ | (0.04 | ) | $ | (0.03 | ) | $ | (0.11 | ) | $ | (0.18 | ) | ||||
Non-GAAP net income (loss) per common share (excluding stock-based compensation expense and other items) - basic | $ | 0.01 | $ | 0.01 | $ | 0.07 | $ | (0.05 | ) | |||||||
Non-GAAP net income (loss) per common share (excluding stock-based compensation expense and other items) - diluted | $ | 0.01 | $ | 0.01 | $ | 0.06 | $ | (0.05 | ) | |||||||
GAAP shares used in computing net loss per common share, basic | 74,618 | 57,292 | 73,100 | 56,791 | ||||||||||||
GAAP shares used in computing net loss per common share, diluted | 81,681 | 57,292 | 80,009 | 56,791 | ||||||||||||
Total spend reconciliation: | ||||||||||||||||
GAAP total cost of revenue and operating expenses | $ | 58,812 | $ | 40,763 | $ | 157,905 | $ | 120,901 | ||||||||
(b) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 8,520 | 2,561 | 18,066 | 7,419 | ||||||||||||
(c) Revaluation of contingent consideration | (3,056 | ) | — | (3,056 | ) | — | ||||||||||
Non-GAAP total cost of revenue and operating expenses (total spend) | $ | 53,348 | $ | 38,202 | $ | 142,895 | $ | 113,482 | ||||||||
Gross profit and gross margin reconciliations: | ||||||||||||||||
GAAP gross profit | $ | 35,062 | $ | 29,854 | $ | 106,974 | $ | 85,578 | ||||||||
(a) Net impact of acquisition related deferred revenue before fair value adjustment | 1,892 | — | 1,892 | — | ||||||||||||
(b1) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 2,322 | 291 | 3,601 | 989 | ||||||||||||
Non-GAAP gross profit | $ | 39,276 | $ | 30,145 | $ | 112,467 | $ | 86,567 | ||||||||
GAAP gross margin percentage | 68 | % | 77 | % | 73 | % | 77 | % | ||||||||
Non-GAAP gross margin percentage | 74 | % | 78 | % | 76 | % | 78 | % | ||||||||
Cost of revenue reconciliation: | ||||||||||||||||
GAAP cost of revenue | $ | 16,474 | $ | 8,831 | $ | 38,800 | $ | 25,267 | ||||||||
(b1) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 2,322 | 291 | 3,601 | 989 | ||||||||||||
Non-GAAP cost of revenue | $ | 14,152 | $ | 8,540 | $ | 35,199 | $ | 24,278 | ||||||||
Total operating expenses reconciliation: |
SuccessFactors, Inc.
Reconciliation of GAAP to Non-GAAP Measures
(unaudited, in thousands, except per share data)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
GAAP operating expenses | $ | 42,338 | $ | 31,932 | $ | 119,105 | $ | 95,634 | ||||||||
(b2) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 6,198 | 2,270 | 14,465 | 6,430 | ||||||||||||
(c) Revaluation of contingent consideration | (3,056 | ) | — | (3,056 | ) | — | ||||||||||
Non-GAAP operating expenses | $ | 39,196 | $ | 29,662 | $ | 107,696 | $ | 89,204 | ||||||||
Total sales and marketing reconciliation: | ||||||||||||||||
GAAP sales and marketing | $ | 25,166 | $ | 19,573 | $ | 69,585 | $ | 59,125 | ||||||||
(b3) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 2,408 | 1,143 | 6,157 | 3,233 | ||||||||||||
Non-GAAP sales and marketing | $ | 22,758 | $ | 18,430 | $ | 63,428 | $ | 55,892 | ||||||||
Total research and development reconciliation: | ||||||||||||||||
GAAP research and development | $ | 11,048 | $ | 6,344 | $ | 27,699 | $ | 17,967 | ||||||||
(b4) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 975 | 312 | 2,572 | 904 | ||||||||||||
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Non-GAAP research and development | $ | 10,073 | $ | 6,032 | $ | 25,127 | $ | 17,063 | ||||||||
Total general and administrative reconciliation: | ||||||||||||||||
GAAP general and administrative expenses | $ | 9,180 | $ | 6,016 | $ | 24,877 | $ | 18,542 | ||||||||
(b5) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 2,815 | 815 | 5,736 | 2,293 | ||||||||||||
Non-GAAP general and administrative | $ | 6,365 | $ | 5,201 | $ | 19,141 | $ | 16,249 | ||||||||
Operating margin reconciliation: | ||||||||||||||||
GAAP loss from operations | $ | (7,276 | ) | $ | (2,078 | ) | $ | (12,131 | ) | $ | (10,056 | ) | ||||
(a) Net impact of acquisition related deferred revenue before fair value adjustment | 1,892 | — | 1,892 | — | ||||||||||||
(b) Stock-based compensation expense, amortization of intangibles, future cash consideration of acquisitions and integration costs | 8,520 | 2,561 | 18,066 | 7,419 | ||||||||||||
(c) Revaluation of contingent consideration | (3,056 | ) | — | (3,056 | ) | — | ||||||||||
Non-GAAP income (loss) from operations less stock-based compensation and other items | $ | 80 | $ | 483 | $ | 4,771 | $ | (2,637 | ) | |||||||
Non-GAAP Revenue | $ | 53,428 | $ | 38,685 | $ | 147,666 | $ | 110,845 | ||||||||
Non-GAAP operating margin percentage | 0 | % | 1 | % | 3 | % | (2 | %) | ||||||||
Free cash flow reconciliation: | ||||||||||||||||
Net cash provided by operating activities | $ | 13,014 | $ | 3,578 | $ | 32,950 | $ | 7,204 | ||||||||
Less: Capital expenditures | (1,414 | ) | (1,176 | ) | (3,196 | ) | (1,524 | ) | ||||||||
Free cash flow | $ | 11,600 | $ | 2,402 | $ | 29,754 | $ | 5,680 | ||||||||