NEWTON, Mass. and PETACH TIKVAH, Israel – February 9, 2017 – CyberArk (NASDAQ: CYBR), the company that protects organizations from cyber attacks that have made their way inside the network perimeter, today announced financial results for the fourth quarter and year ended December 31, 2016.
“CyberArk had an incredible 2016,” said Udi Mokady, CyberArk Chairman and CEO. “We outperformed across revenue, operating income and net income per share, demonstrating the ongoing execution of our land and expand strategy and the power of our operating model. Protecting privileged accounts, across the enterprise, on endpoints, in the cloud and in hybrid environments, is increasingly recognized as fundamental to cyber security programs. Because of our operational and financial success in 2016, we entered 2017 as an even stronger company, well positioned to continue to deliver profitable revenue growth.”
Financial Highlights for the Fourth Quarter Ended December 31, 2016
Revenue:
- Total revenue was $64.4 million, up 25% compared with the fourth quarter of 2015.
- License revenue was $40.8 million, up 23% compared with the fourth quarter of 2015.
- Maintenance and Professional Services revenue was $23.6 million, up 28% compared with the fourth quarter of 2015.
Operating Income:
- GAAP operating income was $13.2 million, compared to $10.9 million in the fourth quarter of 2015. Non-GAAP operating income was $19.4 million, compared to $15.2 million in the fourth quarter of 2015.
Net Income:
- GAAP net income was $10.2 million, or $0.28 per diluted share, compared to GAAP net income of $9.9 million, or $0.28 per diluted share, in the fourth quarter of 2015. Non-GAAP net income was $14.7 million, or $0.41 per diluted share, compared to $13.8 million, or $0.39 per diluted share, in the fourth quarter of 2015.
Financial Highlights for the Full Year Ended December 31, 2016
Revenue:
- Total revenue was $216.6 million, up 35% compared with 2015.
- License revenue was $131.5 million, up 31% compared with 2015.
- Maintenance and Professional Services revenue was $85.1 million, up 40% compared with 2015.
Operating Income:
- GAAP operating income was $36.0 million, compared to $33.2 million in 2015. Non-GAAP operating income was $58.0 million, compared to $43.6 million in 2015.
Net Income:
- GAAP net income was $28.1 million, or $0.78 per diluted share, compared to GAAP net income of $25.8 million, or $0.73 per diluted share, in 2015. Non-GAAP net income was $45.2 million, or $1.26 per diluted share, compared to $35.3 million, or $1.00 per diluted share, in 2015.
The tables at the end of this press release include a reconciliation of GAAP to non-GAAP operating income and net income for the three and twelve months ended December 31, 2016 and 2015. An explanation of these measures is also included below under the heading “Non-GAAP Financial measures.”
Balance Sheet and Cash Flow From Operations:
- As of December 31, 2016, CyberArk had $295.5 million in cash, cash equivalents, marketable securities and short-term deposits. This compares with $274.6 million in cash, cash equivalents, marketable securities and short-term deposits as of September 30, 2016 and $238.3 million as of December 31, 2015.
- During 2016, the Company generated $56.3 million in cash flow from operations, compared to $59.2 million during in 2015.
Business Outlook
Based on information available as of February 9, 2017, CyberArk is issuing guidance for the first quarter and full year 2017 as indicated below.
First Quarter 2017:
- Total revenue is expected to be in the range of $57.0 million to $58.0 million, which represents 22% to 24% year-over-year growth.
- Non-GAAP operating income is expected to be in the range of $9.9 million to $10.7 million.
- Non-GAAP net income per share is expected to be in the range of $0.21 to $0.23 per share. This assumes 36.2 million weighted average diluted shares.
Full Year 2017:
- Total revenue is expected to be in the range of $267.0 million to $270.0 million which represents 23% to 25% year-over-year growth.
- Non-GAAP operating income is expected to be in the range of $56.0 million to $58.0 million.
- Non-GAAP net income per share is expected to be in the range of $1.20 to $1.24 per share. This assumes 36.4 million weighted average diluted shares.
Conference Call Information
CyberArk will host a conference call today, at 4:30 p.m. Eastern Time (ET) to discuss the company’s fourth quarter and year end financial results and its business outlook. To access this call, dial +1 844-237-3590 (U.S.) or +1 484-747-6582 (international). The conference ID is 48627364. Additionally, a live webcast of the conference call will be available via the “Investor Relations” section of the company’s web site at www.cyberark.com. Following the conference call, a replay will be available for one week at +1 855-859-2056 (U.S.) or +1 404-537-3406 (international). The replay pass code is 48627364. An archived webcast of the conference call will also be available in the “Investor Relations” section of the company’s web site at www.cyberark.com.
About CyberArk
CyberArk is the only security company focused on eliminating the most advanced cyber threats; those that use insider privileges to attack the heart of the enterprise. Dedicated to stopping attacks before they stop business, CyberArk proactively secures against cyber threats before attacks can escalate and do irreparable damage. The company is trusted by the world’s leading companies – including more than 45 percent of the Fortune 100 – to protect their highest value information assets, infrastructure and applications. A global company, CyberArk is headquartered in Petach Tikvah, Israel, with U.S. headquarters located in Newton, Mass. The company also has offices throughout EMEA and Asia Pacific and Japan. To learn more about CyberArk, visit www.cyberark.com, read the company blog, https://www.cyberark.com/blog/, follow on Twitter @CyberArk or Facebook at https://www.facebook.com/CyberArk.
Non-GAAP Financial Measures
CyberArk believes that the use of non-GAAP operating income and non-GAAP net income is helpful to our investors. These financial measures are not measures of the Company’s financial performance under U.S. GAAP and should not be considered as alternatives to operating income or net income or any other performance measures derived in accordance with GAAP.
- For the three months and year ended December 31, 2016, non-GAAP operating income is calculated as GAAP operating income excluding share-based compensation expense and amortization of intangible assets related to acquisitions. For the three months and year ended December 31, 2015, non-GAAP operating income is calculated as operating income excluding public offering, amortization of intangible assets and acquisition related expenses as well as share-based compensation expense.
- For the three months and year ended December 31, 2016, non-GAAP net income is calculated as GAAP net income excluding share-based compensation expense, amortization of intangible assets related to acquisitions and the tax effects related to the non-GAAP adjustments. For the three months and year ended December 31, 2015, non-GAAP net income is calculated as GAAP net income excluding public offering, amortization of intangible assets and acquisition related expenses as well as share-based compensation expense and the tax effects related to the non-GAAP adjustments.
Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expense, the Company believes that providing non-GAAP financial measures that exclude share-based compensation, public offering and acquisition related expenses and amortization of intangible assets related to acquisitions allows for more meaningful comparisons of its period to period operating results. Share-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in the Company’s business and an important part of the compensation provided to its employees. The Company believes that expenses related to its public offerings, acquisitions and amortization of intangible assets related to acquisitions do not reflect the performance of its core business and impact period-to-period comparability.
Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures as they exclude expenses that may have a material impact on the Company’s reported financial results. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with U.S. GAAP. CyberArk urges investors to review the reconciliation of its non-GAAP financial measures to the comparable U.S. GAAP financial measures included below, and not to rely on any single financial measures to evaluate its business.
