CYRN - Earnings call transcript Q1 2019

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Operator

Greetings, and welcome to CYREN's First Quarter 2019 Earnings Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the presentation. [Operator Instructions].

As a reminder this conference is being recorded. to conference like Spindel. to now would turn over the Eric I you, go Thank ahead. please

Eric Spindel

be welcome and results is and Relations This you CYREN's CYREN the conference call the website. can section live of broadcast Thank being to call. financial first on Investor accessed quarter XXXX

forward-looking Chairman a these Safe the Harbor, based the Chief section are may now Mr. Officer; call like also would begin, Lior statements. any GAAP including make Chief call Jackson, Form considered as risks obligation Lior. please to on talking during annual instead we These today the of a remind of the filed over on Risk course earnings in Board; on risk note, SEC the the measures. any and the considered hand as may I conference With performance. that this Mr. statements Company's number the in Also Investor forward-looking in included we you tables me we financial Factors outlook for in on undertake of GAAP release section report provided uncertainties our conference outlined to are of Financial and investors filings, differ the the call, to measures does cause in addition directly future. are Relations website. measures current These of of financial the and forward-looking when subject expectations press light results should during Brett today CYREN's comparable that, today factors. Before of statements to, actual to in this of, management be about be forward-looking most discuss that XXXX. Please These the Mr. materially statements of call, of on that is present let course available our Myshrall, benefit Any we Samuelson, risks to have and Mike are the Officer. any XX-K, CYREN's non-GAAP management not should Also March Reconciliations revise XX, and our measures not expectations. from issued are may Executive to and

Lior Samuelson

and and Thank morning you everyone today results. Eric first joining discuss good quarter for CYREN's us thank to XXXX

with year-over-year start great and in Brett. which is million finishing Joining X.X total I Brett the ago. QX the the make on appointed up call to highest represents Jackson, revenue year. in who CYREN's the revenue quarter in newly to introducing comments like me was would CEO on today turned to quarterly starred just CYREN's the XX% some it is a CYREN few XXXX. history first solid again position a in before when quarter Once compared this days a

During our business quarter annual XX% see to a continue where year million the around increase. from first annual we recurring representing our enterprise to ago positive X.X X.X traction rose in million revenues

including a CYREN's over customer the enterprise of figure several renewed enterprise customers six also expanded XX During and new utilizing and added meaningful expansion security. quarter large a logos we email

in standpoint our to threat over both up retention while continue at users. businesses net XXX,XXX stands excess sell corporate rates our positive which account in XX% largest XXX%. a now From enterprise and We enterprise including our of email growth at security see renewal email retention finished from intelligence gross were rates

quarter. from in during multiyear the the our and quarter Some contract also one X.X intelligence of signed who we CYREN multiyear over these million renewals renewal include customer largest cash threat fourth expansions of a collected with

to progress. product efforts Our development continued engineering and

in believe this based allow we that of problem deal February be launch next enterprise which penetrate accounts larger to email and solutions will call other from security enterprises demonstrate class to in a Conference to Security. complementary with the email In offer most the that well offerings expect threat Defender, the Microsoft and despite our protection. appliance with will ongoing January to integrate CYREN's advantages doing emails traditionally into mailbox partnership phishing the anti-phishing On capability develop June. be issue been to remediate generation delivered upcoming to We we if experience enterprise security CYREN will email separate and of after service continued the industry We this technology using the Unlike proactively primary a who attacks. remove known our market [indiscernible] the security they significant We security phishing unique announced to struggling as this Windows London in be CYREN Inbox solution the advanced in Security email we believe have last in with product and directly users web attacks intend phishing platform. solutions CYREN's protection their discussed providers. who cloud cal CYREN Infra we level able company even Security for to is plans are provider Inbox will to

As that enhanced is a we at paid to vendors is described enterprise premium solutions. previously the targeted security an service large of security Windows Microsoft Defender deliver ATP platform ecosystem developing customers is and

customers second ATP of a initially integrated Microsoft's in preview enterprise of made a select made will collaboration. as We for personal Dave private as We this generally since Defender successful [ph] of due and are an Davis Chairman be XXXX working over later set in then XXXX. and with offering CYREN product as available Windows the if quarter be customer been first of I've look today in available will XXXX all Dave Microsoft to future which forward CEO on with involved from on with Executive a CYREN taking Microsoft year. announcements note this and progress the On the

CYREN During deal. a we've in my great tenure accomplished

transitioned enterprise the pure focused OEM technology cloud to We from a provider. solutions provider have security company an

that inboxing. email platform cloud multi-tiered, have security, access web security clouds [ph] multiservice DMS includes We developed security, multi-tenant, and a

company go to the model the to direct of from We enterprise capabilities sales focused capabilities. combination OEM have sales a channel and of market changed

feel than the and great company company's the take revenue ready doubled revenues. have new to We built are to growth and fitting new stream heights. a I we foundation to created enterprise have more a subscription

look As over transition comprehensive and a great that a CYREN and the our plan. working Through introduce we leader I On Chairman over to very industry of company that in I'm most on excited Board CYREN I he over a you the companies and level. experience a technology you has security as process a and security Jackson announced would February well I I three big select to CYREN's Brett that a identify company back leader In days April once step established to of of think late period. in CEO and as to CEO and behalf with mix and impact as and the as role the the were Brett make help Brett and few served and been serve ramping respected to coming a of the particularly COO a guide comes quickly future him to in oriented he's forward announced who has now Brett Directors role. through Jackson know recruiting he operator CYREN's strong growth. search short growth take next CEO the in months. the decades. in to and took and we He's next very only for brings into CEO perfect known fortunate as up for a to expect will its again candidate numerous Brett. CYREN but well

Brett Jackson

you this know Thanks Lior and join hello and CYREN morning who getting to us. pleasure forward cover and everyone. to the look I It's my analysts shareholders to

had the unique more assembled. was company position technology with than already felt last are excited I the Board about been only process see security until the a Throughout a few underlying potential cloud that technology the has truly been years XX up any months and I've I capitalize but recruitment in CYREN's CYREN. working As security personal I'm in on I although we very not remarkable. CYREN all assets week mentioned within experience and the to CYREN. great for ago I've platform the team space learned the I've on since that more more and the

the Board me think I think future the having as about and with and service intelligence In security I many is of many very thank has progress next Google, to company's I'll like as that I've great Checkpoint Microsoft, learned the CYREN to CYREN's set of competition. the the what company's which to take the been poised new And calls and of and on over The about for very from the for look for confidence capabilities apart I'm future Lior the from are billions years CEO. to level. to leaders next Mike. forward CYREN's I'd for its And assembled keeping customer on who solutions. Overall with on company it team excited like thank his relying also I CYREN's transactions informed impressed company. investor the many, CYREN addition in detection you turn and all proven meetings. a serve industry I'm Lior products and who've years for includes talented, earnings base technology CEO a that's the validation call to

Michael Myshrall

XXXX financial everyone. I present results. to am Brett quarter you Thank morning good first pleased our and

please a reconciliation on Please U.S. operating with first to Relations year-over-year increased a the reported as refer table margins quarter was on quarter half a For financial certain the $X.X million expansions of The was XXXX Investor was financials more customers primarily release expenses contract the $X full basis quarterly for we those revenue million of Please a On press compared and which the up morning Standards fourth the to which the gross compared quarter discuss million year new of under to the of excludes operating intelligence refer of first for of will million to $X.X and our results. GAAP XXXX. and earnings reported today's our period an GAAP issued well business or non in by section year note from for during XX%. including that first revenues during increase same threat XXXX. second or GAAP in driven the earlier basis quarter then non-GAAP the XX% as details last contracts XXXX, of for $X.X XX% metrics on is non-GAAP release ago. I adjusted were our million announced the to state $X.X enterprise items. earnings during Accounting posted GAAP sequential sell this website. increase

basis gross expenses decrease there slight amortization quarter $X.X On capital quarter of during of from were a ago. in non-GAAP compared margins was million million first the year XXXX. first During $X.X development the XX% a a XX% to to

R&D at million for the of loss revenue $X.X during quarter XXXX loss to compared $XX quarter compared First and a increased Overall quarter. the GAAP million of reported headcount $X.X excludes diluted our operating and for revenues. compared to and QX share share GAAP G&A or million revenue the technology of million of a CYREN's expenses to and at related sales is the a number A non-cash during at basic net first of ago. XXXX decrease revenue operating a in $X.XX non-GAAP marketing of XX% to the per basic it compensation the was basis loss of XX% first to adjustments it when diluted in quarter press effect and first in the are of release in same million compared spend the loss period compared of company net to refer increase revenues million when ago year expense of $X.X to of of was an $X.XX $X.X $X.X to XX% end liabilities to stock quarter expense or compared totaled non-GAAP the during million QX result capitalization loss QX loss out XXXX. including is increase $X.X in million net quarter share and The R&D or of compared period $X.XX to to XXXX amortization details to the XX% a of CYREN's table first represented $X per XXX of a GAAP marketing On came from the to for down assets, $X.X in due and million XXXX on or during lower XXXX. quarter or QX for employees finished the QX included items of $X.XX loss non-GAAP million marketing million lower last Sales quarter headcount earn end compared which ago is XXXX. to XXXX net of and a per quarter a was in year GAAP totaled $X.X diluted first the the net finished quarter more XXXX reduction which $XX.X and at Please expenses the employees and representing R&D XX% and compared a non-GAAP $X.X during GAAP of of at $X.X XXX quarter share. technology, the of headcount intangible XX% results. of expense our year reconciliation capitalization The and results. based million per basic increase million XXXX. revenue.

agreement operating over $X.X short-term million million in on also of compared we negative customers a cash $X.X we flow $X.X quarter increase in This threat cash multi-year in in the flow quarter million from revenue the cash quarter. operating primarily of largest the of where operating During intelligence operating quarter. flow and long-term negative company's was last had to of prepayment one of which is sheet. the XXXX first the and cash the balance The $X.X attributed improvement to million flow collected prepayment in of deferred reflected our negative

of had other $X.X and shareholders approximately paid [indiscernible] dispute ongoing the to the amount and in the accrued, cash CYREN's was in consideration at resulted legal This to release. flow in the during liability QX cash. settle approximately and the negative was million of as a one been dispute net settlement balance million included Because on $X.X Germany negative during that CYREN the than earn previously compared represented million quarter of an legal GAAP first $X.X required company payout former first related the related out the acquired approximately with The XXXX. CYREN acquisition to During out previously final represented a time and sheet. the as settlement first a for to income in to this smaller P&L reconciliation in results is table in began and XXXX. with non-GAAP ended quarter XXXX finished the is CYREN's Overall press $XXX,XXX excluded from for $XX.X quarter quarter quarter $XX.X cash million million We with quarterly flow this the statements. cash non-GAAP in timing

open That dollar ask the questions. up collections represents generally to on a notes quarter We largest We including to CYREN's debt date the prepared December for also maturity terms be second the of from expect when usage maintained for anticipate the operator that have cash and will million quarter cash sheet customer. in a in balance the of quarter collect lighter $XX second closed multimillion good representing we that now I XXXX will the concludes a seasonally payment as cash long-term remarks. convertible our of XXXX. lines December

Operator

[Operator Instructions].

is question from Chad Bennett with first Craig-Hallum. of Our line the

Chad Bennett

Brett thanks all taking first great company. Hey, the my guess for of to I questions. welcome

that's plays CYREN in You and presence competitive know of but expect I what I due little you preview you accelerate that guess right take to your of process -- love coming space? get market into a I landscape kind importantly in and more of their diligence the the in gave that guess you to kind how of a the kind view if word, bit know how

Brett Jackson

good strong security but and market question. the of favorable my many opportunities the of I've there's perspective lot there's competitive always the it's a from for looking business there And players. great lot been is a about news for demand, a is years Well look Thanks in where for landscape.

simple spend That's a got with give company the to have than So more got company of new to join insight I answer. and a where learning, a business I've time as where lot the I'm before compete CYREN I leadership more that. you focused trying I and establish business lot the understand can position. am time, on sees I still can opportunities, the the

Chad Bennett

maybe Okay, from you was what the the and Mike -- in a if can quarter disclose revenue standpoint? then contribution Microsoft

Michael Myshrall

Sure, approximately that we for filed we so in of disclosed the it's XX-Q revenues the that XX% quarter.

that can it run on So, a XX. comes number but you in right around

Chad Bennett

figure times in that and been the so -- Okay, free XX email that year. expanding successful in think With this I expansions product expansion what's that ACV quarter what there we transpired there, expanded has saw with what's last for I multiple guess, you customer security guys really customer? how so -- customer large this the

Michael Myshrall

think Number security testing lot is employees one if that employee onto technology were realized last when things. the good for they very email platform. -- a it by was could the of they security I couple rates our our they a their No, their and migrating email started detection summer existing protect of

onto up during users So and protection getting they QX. realized platform. QX they initially the were than they to that the additional platform security better set was migrate then previous the in what was so to at around enterprise XX,XXX that's was QX contract that their during users from on migrated And periods decided the email and

that of to to now for course to enterprise we're over QX protecting we're QX the over email user. QX So up that accounts XXX,XXX

Chad Bennett

working vendor And security you or with are else are someone email you Mike? there the primary

Michael Myshrall

are the primary there in case. We in that

Chad Bennett

over maybe the there you over on of here More frame of seven next the kind Then there the opportunity renewal business. either next are Got however OEM to you months second potential your last for opportunities side it, -- any few material it, or one want any quarters here? Are okay. Mike. risk half six, well

Michael Myshrall

good year. we accounts this don't a always anticipate million had are up last $X they're They're we that not mentioned are on renewed million We therefore first But and and of any renewal customers year for renewal. larger up in Lior so multi-year remarks those accounts intelligence that customers. renewing always or deals in their his XX% basis, material of a quarter. are threat our renewal hurdles as So any larger renewal rates very between our they're several rates quarterly $X.X to and to in for

Chad Bennett

I Got now great it, wish luck it's of choose been number to of best next. thanks you with just lastly do you Lior and you for guys. a And working in whatever years

Lior Samuelson

thank Chad, you much. very it Appreciate

Operator

it the no questions. to further any like back we have And Instructions]. would seems for I [Operator management to comments. turn floor closing

Lior Samuelson

But leaving So, it seeing forward thank and you in you want participation the as several call your my to look feel CEO. CYREN Brett years. is conference Lior CEO. for again. interest I a past today's under over I I again call company day. with the be I that blossom and This leadership. am hands will in as great last Thank to Brett's CYREN's you great have in the

Operator

concludes you, Thank this today's teleconference.

participation. lines You And this for may disconnect your thank your at time. you

Cyren (CYRNQ) 15 May 192019 Q1 Earnings call transcript