Electronics For Imaging (EFII) 8-K Efi Reports Third Quarter 2017 Results

Exhibit 99.1

For more information:	Investor Relations:
Marc Olin	JoAnn Horne
Chief Financial Officer	Market Street Partners
EFI	415-445-3235
650-357-3500

EFI REPORTS THIRD QUARTER 2017 RESULTS

Fremont, Calif. – October 26, 2017– Electronics For Imaging, Inc. (Nasdaq: EFII), a world leader in customer-focused digital printing innovation, today announced its results for the third quarter of 2017.

For the quarter ended September 30, 2017, the Company reported record third quarter revenue of $248.4 million, up 1% compared to third quarter 2016 revenue of $245.6 million. GAAP net income was $1.9 million, down 89% compared to $17.7 million for the same period in 2016 or $0.04 per diluted share, down 89% compared to $0.37 per diluted share for the same period in 2016.Non-GAAP net income was $22.7 million, down 18% compared tonon-GAAP net income of $27.6 million for the same period in 2016 or $0.48 per diluted share, down 17% compared to $0.58 per diluted share for the same period in 2016. Cash flow from operating activities was $3.4 million, down 86% compared to $24.0 million during the same period in 2016.

For the nine months ended September 30, 2017, the Company reported revenue of $724.1 million, down 0.2% year-over-year compared to $725.4 million for the same period in 2016. GAAP net income was $9.4 million or $0.20 per diluted share, compared to $25.0 million or $0.52 per diluted share for the same period in 2016.Non-GAAP net income was $74.0 million or $1.57 per diluted share, compared tonon-GAAP net income of $80.5 million or $1.68 per diluted share for the same period in 2016. Cash flow from operating activities for the nine months ended September 30, 2017, was $42.4 million, down 24% compared to $55.8 million during the same period in 2016.

“We are clearly disappointed in the third quarter results, which fell below our expectations largely due to delayed deals in our direct business,” said Guy Gecht, CEO of EFI. “To reaccelerate growth, we are reallocating budget and talent toward our largest opportunities, in textile and packaging, along with making organizational changes and adding senior positions to improve focus and execution.”

Conference Call

EFI will discuss the Company’s financial results by conference call at 5:00 pm ET/2:00 pm PT today. Instructions for listening to the conference call over the Web are available on the investor relations portion of EFI’s website atwww.efi.com.

About EFI

EFI™ is a global technology company, based in Silicon Valley, and is leading the worldwide transformation from analog to digital imaging. We are passionate about fueling customer success with products that increase competitiveness and boost productivity. To do that, we develop breakthrough technologies for the manufacturing of signage, packaging, textiles, ceramic tiles, and personalized documents, with a wide range of printers, inks, digital front ends, and a comprehensive business and production workflow suite that transforms and streamlines the entire production process. (www.efi.com)

1

Safe Harbor for Forward Looking Statements

Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements other than statements of historical fact including words such as “address”, “anticipate”, “believe”, “consider”, “continue”, “develop”, “estimate”, “expect”, “further”, “look”, “plan”, and “progress” and statements in the future tense are forward looking statements. The statements in this press release that could be deemed forward-looking statements include statements regarding EFI’s strategy, plans, expectations regarding its revenue growth, introduction of new products, product portfolio, productivity, future opportunities for EFI and its customers, demand for products, and any statements or assumptions underlying any of the foregoing.

Forward-looking statements are subject to certain risks and uncertainties that could cause our actual future results to differ materially, or cause a material adverse impact on our results. Potential risks and uncertainties include, but are not necessarily limited to, intense competition in each of our businesses, including competition from products developed by EFI’s customers; our ability to remediate the material weaknesses identified in EFI’s internal control over financial reporting; the uncertainty of the outcome of the pending securities lawsuits against EFI; unforeseen expenses; fluctuations in currency exchange rates; the difficulty of aligning expense levels with revenue; management’s ability to forecast revenues, expenses and earnings; our ability to successfully integrate acquired businesses; changes in the mix of products sold; the uncertainty of market acceptance of new product introductions; challenge of managing asset levels, including inventory and variations in inventory levels; the uncertainty of continued success in technological advances; the challenges of obtaining timely, efficient and quality product manufacturing and supply of components; any world-wide financial and economic difficulties and downturns; adversetax-related matters such as tax audits, changes in our effective tax rate or new tax legislative proposals; the unpredictability of development schedules and commercialization of products by the leading printer manufacturers and declines or delays in demand for our related products; the impact of changing consumer preferences on demand for our textile products; litigation involving intellectual property rights or other related matters; the uncertainty regarding the amount and timing of future share repurchases by EFI and the origin of funds used for such repurchases; the market prices of EFI’s common stock prior to, during and after the share repurchases; and any other risk factors that may be included from time to time in the Company’s SEC reports.

The statements in this press release are made as of the date of this press release. EFI undertakes no obligation to update information contained in this press release. Amounts are subject to rounding.

For further information regarding risks and uncertainties associated with EFI’s businesses, please refer to the section entitled “Risk Factors” in the Company’s SEC filings, including, but not limited to, its annual report on Form10-K and its quarterly reports on Form10-Q, copies of which may be obtained by contacting EFI’s Investor Relations Department by phone at650-357-3828 or by email atinvestor.relations@efi.com or EFI’s Investor Relations website atwww.efi.com.

Use ofNon-GAAP Financial Information

To supplement our condensed consolidated financial results prepared under generally accepted accounting principles, or GAAP, we usenon-GAAP measures of net income and earnings per diluted share that are GAAP net income and GAAP earnings per diluted share adjusted to exclude certain costs, expenses, and gains. A reconciliation of the adjustments to GAAP results for the three and nine months ended September 30, 2017 and 2016 is provided below. In addition, an explanation of how management usesnon-GAAP financial information to evaluate its business, the substance behind management’s decision to use thisnon-GAAP financial information, the material limitations associated with the use ofnon-GAAP financial information, the manner in which management compensates for those limitations, and the substantive reasons management believes that thisnon-GAAP financial information provides useful information to investors is included under “About ourNon-GAAP Net Income and Adjustments” after the tables below.

Ournon-GAAP measures are not in accordance with or an alternative to GAAP and may be materially different from othernon-GAAP measures, including similarly titlednon-GAAP measures, used by other companies. The presentation of this additional information should not be considered in isolation from, as a substitute for, or superior to, net income or earnings per diluted share prepared in accordance with GAAP.Non-GAAP financial measures have limitations in that they do not reflect certain items that may have a material impact upon our reported financial results. We expect to continue to incur expenses of a nature similar to thenon-GAAP adjustments described above, and exclusion of these items from ournon-GAAP net income andnon-GAAP earnings per diluted share should not be construed as an inference that these costs are unusual, infrequent, ornon-recurring.

2

Electronics For Imaging, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2017			2016			2017			2016
Revenue	$	248,359		$	245,575		$	724,097		$	725,358
Cost of revenue		123,315			120,381			348,272			356,720
Gross profit		125,044			125,194			375,825			368,638
Operating expenses:
Research and development		40,568			36,933			119,184			111,731
Sales and marketing		42,269			43,060			129,018			127,360
General and administrative		23,901			24,088			66,065			66,366
Amortization of identified intangibles		12,299			10,395			34,829			29,360
Restructuring and other		833			1,308			5,422			5,733
Total operating expenses		119,870			115,784			354,518			340,550
Income from operations		5,174			9,410			21,307			28,088
Interest expense		(4,912	)		(4,510	)		(14,538	)		(13,243	)
Interest income and other income, net		1,760			915			2,802			1,114
Income before income taxes		2,022			5,815			9,571			15,959
Benefit from (provision for) income taxes		(142	)		11,847			(146	)		9,041
Net income	$	1,880		$	17,662		$	9,425		$	25,000
Diluted EPS calculation
Net income	$	1,880		$	17,662		$	9,425		$	25,000
Net income per diluted common share	$	0.04		$	0.37		$	0.20		$	0.52
Shares used in diluted per share calculation		46,937			47,621			47,102			47,791

3

Electronics For Imaging, Inc.

Reconciliation of GAAP Net Income toNon-GAAP Net Income

(in thousands, except per share data)

(unaudited)

	Three Months Ended									Nine Months Ended
	September 30,									September 30,
							Ex-Currency									Ex-Currency
	2017			2016			2017			2017			2016			2017
Net income	$	1,880		$	17,662		$	1,880		$	9,425		$	25,000		$	9,425
Cost of revenue related to fair value inventory adjustment		77			—			77			1,260			—			1,260
Ex-currency adjustment		—			—			(295	)		—			—			1,126
Stock based compensation – Cost of revenue		486			643			486			1,985			2,187			1,985
Stock based compensation – Research and development		1,640			2,061			1,640			7,556			8,631			7,556
Stock based compensation – Sales and marketing		1,108			2,284			1,108			5,176			6,669			5,176
Stock based compensation – General and administrative		1,414			3,590			1,414			7,824			12,214			7,824
Amortization of identified intangibles		12,299			10,395			12,299			34,829			29,360			34,829
Restructuring and other		833			1,308			833			5,422			5,733			5,422
General and administrative:
Acquisition-related transaction costs		637			434			637			1,820			1,700			1,820
Changes in fair value of contingent consideration		410			4,252			410			2,187			6,310			2,187
Revenue recognition review costs and litigation settlements		3,651			71			3,651			3,929			912			3,929
Interest income and other income, net
Non-cash interest expense related to our convertible notes		3,293			3,155			3,293			9,713			9,237			9,713
Foreign exchange fluctuation related to contingent consideration		131			5			131			45			461			45
Balance sheet currency remeasurement impact		—			—			(350	)		—			—			1,343
Tax effect ofnon-GAAP adjustments		(5,178	)		(18,309	)		(5,056	)		(17,205	)		(27,922	)		(17,674	)
Non-GAAP net income	$	22,681		$	27,551		$	22,158		$	73,966		$	80,492		$	75,966
Non-GAAP net income per diluted common share	$	0.48		$	0.58		$	0.47		$	1.57		$	1.68		$	1.61
Shares used in diluted per share calculation		46,937			47,621			46,937			47,102			47,791			47,102

4

Electronics For Imaging, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

	September 30,		December 31,
	2017		2016
Assets
Cash and cash equivalents	$	175,830	$	164,313
Short-term investments		217,923		295,428
Accounts receivable, net		236,709		220,813
Inventories		130,122		99,075
Other current assets		49,424		36,637
Total current assets		810,008		816,266
Property and equipment, net		106,641		103,304
Goodwill		387,001		359,841
Intangible assets, net		126,567		122,997
Restricted investments and cash equivalents		27,753		6,252
Other assets		76,727		72,836
Total assets	$	1,534,697	$	1,481,496
Liabilities & Stockholders’ equity
Accounts payable	$	133,322	$	114,287
Accrued and other liabilities		168,224		139,318
Income taxes payable		7,302		10,256
Total current liabilities		308,848		263,861
Convertible senior notes, net		315,255		304,484
Imputed financing obligation related tobuild-to-suit lease		14,087		14,152
Noncurrent contingent and other liabilities		31,068		42,786
Deferred tax liabilities		13,763		16,351
Noncurrent income taxes payable		12,439		12,030
Total liabilities		695,460		653,664
Total stockholders’ equity		839,237		827,832
Total liabilities and stockholders’ equity	$	1,534,697	$	1,481,496

5

Electronics For Imaging, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

	Nine Months Ended
	September 30,
	2017			2016
Cash flows from operating activities:
Net income	$	9,425		$	25,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		47,894			40,734
Deferred taxes		(8,317	)		(22,127	)
Stock-based compensation, net of cash settlements		22,541			26,743
Provision for inventory obsolescence		6,056			4,492
Provision for bad debts and sales-related allowances		10,868			7,558
Non-cash accretion of interest expense on convertible notes and imputed financing obligation		11,211			9,991
Othernon-cash charges and gains		3,253			5,920
Changes in operating assets and liabilities, net of effect of acquired businesses		(60,490	)		(42,487	)
Net cash provided by operating activities		42,441			55,824
Cash flows from investing activities:
Purchases of short-term investments		(87,623	)		(195,904	)
Proceeds from sales and maturities of short-term investments		164,979			223,206
Purchases of restricted investments and cash equivalents		(21,459	)		(3,745	)
Purchases, net of proceeds from sales, of property and equipment		(8,745	)		(17,611	)
Businesses purchased, net of cash acquired		(16,739	)		(19,614	)
Net cash provided by (used for) investing activities		30,413			(13,668	)
Cash flows from financing activities:
Proceeds from issuance of common stock		11,730			10,359
Purchases of treasury stock and net share settlements		(56,937	)		(65,354	)
Repayment of debt assumed through business acquisitions and debt issuance costs		(10,786	)		(8,539	)
Contingent consideration payments related to businesses acquired		(9,512	)		(1,868	)
Net cash used for financing activities		(65,505	)		(65,402	)
Effect of foreign exchange rate changes on cash and cash equivalents		4,168			2,158
Increase (decrease) in cash and cash equivalents		11,517			(21,088	)
Cash and cash equivalents at beginning of period		164,313			164,091
Cash and cash equivalents at end of period	$	175,830		$	143,003

6

Electronics For Imaging, Inc.

Revenue by Operating Segment and Geographic Area

(in thousands)

(unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2017			2016		2017		2016
Revenue by Operating Segment
Industrial Inkjet	$	142,930		$	143,004	$	407,886	$	408,926
Productivity Software		37,171			39,663		111,292		108,554
Fiery		68,258			62,908		204,919		207,878
Total	$	248,359		$	245,575	$	724,097	$	725,358
Revenue by Geographic Area
Americas	$	129,488		$	128,252	$	353,397	$	363,977
EMEA		85,089			85,009		274,635		264,469
APAC		33,782			32,314		96,065		96,912
Total	$	248,359		$	245,575	$	724,097	$	725,358
RevenueEx-Currency Adjustment		(3,622	)		—		1,652		—
Total	$	244,737		$	245,575	$	725,749	$	725,358

7

About ourNon-GAAP Net Income and Adjustments

Use ofNon-GAAP Financial Information

To supplement our condensed consolidated financial results prepared in accordance with GAAP, we usenon-GAAP measures of net income and earnings per diluted share that are GAAP net income and GAAP earnings per diluted share adjusted to exclude certain costs, expenses, and gains.

We believe that the presentation ofnon-GAAP net income andnon-GAAP earnings per diluted share provides important supplemental information regarding certain costs, expenses, gains, and significant items that we believe are important to understanding financial and business trends relating to our financial condition and results of operations.Non-GAAP net income andnon-GAAP earnings per diluted share are among the primary indicators used by management as a basis for planning and forecasting future periods and by management and our Board of Directors to determine whether our operating performance has met specified targets and thresholds. Management usesnon-GAAP net income andnon-GAAP earnings per diluted share when evaluating operating performance because it believes the exclusion of the items described below, for which the amounts and/or timing may vary significantly depending on our activities and other factors, facilitates comparability of our operating performance from period to period. We have chosen to provide this information to investors so they can analyze our operating results in the same way that management does and use this information in their assessment of our business and the valuation of our Company.

Use and Economic Substance ofNon-GAAP Financial Measures

We computenon-GAAP net income, andnon-GAAP earnings per diluted share by adjusting GAAP net income and GAAP earnings per diluted share to remove the impact of amortization of acquisition-related intangibles, stock-based compensation expense, restructuring and other expenses, acquisition-related transaction expenses, costs to integrate such acquisitions into our business, incremental cost of revenue due to the fair value adjustment to inventories acquired in business combinations, changes in the fair value of contingent consideration, revenue recognition review costs and litigation settlement charges, andnon-cash interest expense related to our 0.75% convertible senior notes (“Notes”). We use a constantnon-GAAP tax rate of 19%, which we believe reflects the long term average tax rate based on our international structure and geographic distribution of revenue and profit.

Ex-Currency. To better understand trends in our business, we believe it is helpful to adjust our statement of operations to exclude the impact of year-over-year changes in the translation of foreign currencies into U.S. dollars. This is anon-GAAP measure that is calculated by adjusting revenue andnon-GAAP net income by using historical exchange rates in effect during the comparable prior year period and removing the balance sheet currencyre-measurement impact from interest income and other income (expense), net, including removal of any hedging gains and losses. We refer to these adjustments as“ex-currency.” Management believes theex-currency measures provide investors with an additional perspective on year-over-year financial trends and enables investors to analyze our operating results in the same way management does. The year-over-year currency impact can be determined as the difference between year-over-year actual growth rates and year-over-yearex-currency growth rates.

These excluded items are described below:

• Inventory acquired in the acquisition of the Free Flow Print Server business (“FFPS”) is required to be recorded at fair value rather than historical cost in accordance with ASC 805. The fair value of FFPS inventory reflects the manufacturing cost plus a portion of the expected gross profit. We have adjusted our cost of revenue to reflect the expected gross profit that was included in the inventory valuation under ASC 805. We believe this adjustment is useful to investors to understand the gross profit trends of our ongoing business.

• Intangible assets acquired to date are being amortized on a straight-line basis.

• Stock-based compensation expense of $22.5 and $29.7 million during the nine months ended September 30, 2017 and 2016, respectively, consists of $22.5 and $26.9 million of stock-based compensation expense recognized in accordance with ASC 718, Stock Compensation, and thenon-cash settlement of $2.8 million of vacation liabilities settled through the issuance of RSUs during the nine months ended September 30, 2016, which is not included in the GAAP presentation of our stock-based compensation expense.

8

• Restructuring and other expenses consists of:

• Restructuring charges incurred as we consolidate the number and size of our facilities and, as a result, reduce the size of our workforce.

• Expenses incurred to integrate businesses acquired of $0.2 and $1.0 million for the three and nine months ended September 30, 2017, respectively, and $0.6 and $1.5 million for the three and nine months ended September 30, 2016 respectively.

• Acquisition-related transaction costs associated with businesses acquired during the periods reported and anticipated transactions of $0.6 and $1.8 million for the three and nine months ended September 30, 2017, respectively, and $0.4 and $1.7 million for the three and nine months ended September 30, 2016, respectively.

• Changes in fair value of contingent consideration. Our management determined that we should analyze the total return provided by the investment when evaluating operating results of an acquired entity. The total return consists of operating profit generated from the acquired entity compared to the purchase price paid, including the final amounts paid for contingent consideration without considering any post-acquisition adjustments related to changes in the fair value of the contingent consideration. Because our management believes the final purchase price paid for the acquisition reflects the accounting value assigned to both contingent consideration and to the intangible assets, we exclude the GAAP impact of any adjustments to the fair value of acquisition-related contingent consideration from the operating results of an acquisition in subsequent periods, including the related foreign exchange fluctuation impact. We believe this approach is useful in understanding the long-term return provided by our acquisitions and that investors benefit from a supplementalnon-GAAP financial measure that excludes the impact of this adjustment

• Non-cash interest expense on our Notes.Our Notes may be settled in cash on conversion. We are required to separately account for the liability (debt) and equity (conversion option) components of the Notes in a manner that reflects ournon-convertible debt borrowing rate. Accordingly, for GAAP purposes, we are required to amortize a debt discount equal to the fair value of the conversion option as interest expense on our $345 million of 0.75% convertible senior notes that were issued in a private placement in September 2014 over the term of the Notes.

• Revenue recognition review costs and litigation settlements.As described in “Item 9A, Controls and Procedures” of our annual report on Form10-K, for the year ended December 31, 2016, as amended, our management concluded that we had material weaknesses in our internal control over financial reporting as of December 31, 2016 related to revenue recognition practices and therefore did not maintain effective internal control over financial reporting or effective disclosure controls and procedures, both of which are requirements of the Securities Exchange Act of 1934, as of that date. The review of our revenue recognition practices has required that we expend significant management time and incur significant accounting, legal, and other expenses totaling $3.6 million during the three and nine months ended September 30, 2017, and we expect to incur additional costs in the future periods.

We settled or accrued reserves related to several litigation claims of $0.1 and $0.4 million for the three and nine months ended September 30, 2017, respectively, and $0.1 and $0.9 million during the three and nine months ended September 30, 2016, respectively.

• Tax effect ofnon-GAAP adjustments. We use a constantnon-GAAP tax rate of 19%, which we believe reflects the long-term average tax rate based on our international structure and geographic distribution of revenue and profit. The long-term average tax rate is calculated in accordance with the principles of ASC 740, Income Taxes, to estimate thenon-GAAP income tax provision in each jurisdiction in which we operate after excluding the tax effect of thenon-GAAP items described above.

9