BSFT-2014.12.31-EX 99.1

“I am very pleased with our fourth quarter and full year 2014 results, and the achievement of our 2014 strategic objectives, particularly the level of growth in our BroadCloud business,” said Michael Tessler, president and chief executive officer, BroadSoft. “Our positive results were largely driven by increased demand for our hosted Unified Communications offerings. Our goal during 2015 is to capitalize on this increasing market demand to further enhance our leading market position.”

“Our fourth quarter capped a year of strong revenue, billings and cash flow growth that were attributable primarily to strength in our hosted Unified Communications businesses,” said Jim Tholen, chief financial officer, BroadSoft. “We expect 2015 to be another strong year for revenue and billings growth, aided in part by several significant new projects at tier-1 service providers. We are investing to support those projects and others that we believe will be important to our success not just this year, but also in 2016 and beyond.”

BroadSoft will discuss its fourth quarter and full year 2014 results and its business outlook today via teleconference at 8:30 a.m. Eastern Time. To participate in the teleconference, callers can dial the toll free number 1-877-312-5517 (U.S. callers only) or 1-760-666-3772 (from outside the U.S.). The conference call can also be heard live via audio webcast at http://investors.broadsoft.com/events.cfm . To help ensure the conference begins on time, please dial in or connect via the web five minutes prior to the scheduled start time.

BroadSoft has provided in this release, and will provide on this morning’s teleconference, financial information that has not been prepared in accordance with generally accepted accounting principles, or GAAP. BroadSoft uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating BroadSoft’s ongoing operational performance. BroadSoft’s management regularly uses these non-GAAP financial measures to understand and manage its business and believes these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s performance by excluding certain non-cash expenses, and may include additional adjustments for items that are infrequent in nature. BroadSoft believes the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing its financial results with other companies in BroadSoft’s industry, many of which present similar non-GAAP financial measures to investors. A reconciliation of the non-GAAP financial measures included in this release and to be discussed on this morning’s teleconference to the most directly comparable GAAP financial measures is set forth below.

Non-GAAP net income and net income per share. BroadSoft defines non-GAAP net income as net income plus stock-based compensation expense, amortization expense for acquired intangible assets, non-cash interest expense on the Company’s convertible notes, and non-cash tax expense included in the GAAP tax provision. BroadSoft defines non-GAAP income per share as non-GAAP net income divided by the weighted average shares outstanding. BroadSoft considers these non-GAAP financial measures to be useful metrics for management and investors because they exclude the effect of certain non-cash expenses so management and investors can compare BroadSoft’s core business operating results over multiple periods.

Non-GAAP gross profit, license gross profit, subscription and maintenance support gross profit, and professional services and other gross profit. BroadSoft defines non-GAAP gross profit as gross profit plus stock-based compensation expense and amortization expense for acquired intangible assets. BroadSoft considers non-GAAP gross profit to be a useful metric for management and our investors because it excludes the effect of certain non-cash expenses so management and its investors can compare BroadSoft’s sales margins over multiple periods. Where BroadSoft provides further breakdown of non-GAAP gross profit between license, subscription and maintenance support and professional services and other, the Company adds back the stock-based compensation expense and amortization expense, as applicable, to the related gross profit.

Non-GAAP cost of revenue, license cost of revenue, subscription and maintenance support cost of revenue, and professional services and other cost of revenue. BroadSoft defines non-GAAP cost of revenue as cost of revenue less stock-based compensation expense and amortization expense for acquired intangible assets. BroadSoft considers non-GAAP cost of revenue to be a useful metric for management and our investors because it excludes the effect of certain non-cash expenses so management and its investors can compare BroadSoft’s cost of revenue over multiple periods. Where BroadSoft provides further breakdown of non-GAAP cost of revenue between license, subscription and maintenance support and professional services and other, the Company subtracts the stock-based compensation expense and amortization expense, as applicable, to the related cost of revenue.

Non-GAAP income from operations. BroadSoft defines non-GAAP income from operations as income from operations plus stock-based compensation expense and amortization expense for acquired intangible assets. BroadSoft considers non-GAAP income from operations to be a useful metric for management and investors because it excludes the effect of certain non-cash expenses so management and investors can compare BroadSoft’s core business operating results over multiple periods. Where BroadSoft provides further breakdown of non-GAAP operating expenses for sales and marketing, research and development and general and administrative, the Company deducts stock-based compensation expense included in the applicable expense item.

Non-GAAP operating expenses, sales and marketing expense, research and development expense and general and administrative expense. BroadSoft defines non-GAAP operating expenses as operating expense plus stock-based compensation expense allocated to sales and marketing, research and development and general and administrative expenses. Similarly, BroadSoft defines non-GAAP sales and marketing, research and development and general and administrative expenses as the

With respect to our expectations under “Guidance” above, and regarding certain of the projections discussed on this morning’s teleconference, reconciliation of both non-GAAP earnings per share guidance, and of projections regarding non-GAAP cost of sales and non-GAAP operating expenses in the first quarter and full year of 2015, to the closest corresponding GAAP measures are not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures, in particular, the measures and effects of non-cash income taxes, which are extremely difficult to project as a result of our tax status in a number of foreign jurisdictions, and stock-based compensation expense specific to equity compensation awards that are directly impacted by unpredictable fluctuations in our stock price. We expect the variability of the above charges to have a significant, and potentially unpredictable, impact on our future GAAP financial results.

The presentation of non-GAAP net income, non-GAAP net income per share, non-GAAP gross margin, non-GAAP income from operations, billings and other non-GAAP financial measures in this release and on this morning’s teleconference is not meant to be a substitute for “net income,” “net income per share,” “gross margin,” “income from operations” or other financial measures presented in accordance with GAAP, but rather should be evaluated in conjunction with such data. BroadSoft’s definition of “non-GAAP net income,” “non-GAAP net income per share,” “non-GAAP gross margin,” “non-GAAP income from operations,” “billings” and other non-GAAP financial measures may differ from similarly titled non-GAAP measures used by other companies and may differ from period to period. In reporting non-GAAP measures in the future, management may make other adjustments for expenses and gains it does not consider reflective of core operating performance in a particular period and may modify “non-GAAP net income,” “non-GAAP net income per share,” “non-GAAP gross margin,” “non-GAAP income from operations,” “billings” and such other non-GAAP measures by excluding these expenses and gains.

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by their use of terms and phrases such as “anticipate,” “enable,” “expect,” “will,” “believe,” “continue” and other similar terms and phrases, and such forward-looking statements include, but are not limited to, the statements regarding the Company’s future financial performance set forth under the heading “Guidance.” The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including, but not limited to: the Company’s dependence on the success of BroadWorks ® and on its service provider customers to sell services using its applications; the Company’s dependence in large part on service providers’ continued deployment of, and investment in, their IP-based networks; claims that the Company infringes the intellectual property rights of others; the Company’s ability to integrate and achieve the expected benefits from its recent acquisitions; and the Company’s ability to expand its product offerings, as well as those factors contained in the “Risk Factors” sections of the Company’s Form 10-K for the year ended December 31, 2014 filed with the SEC on February 25, 2015, and in the Company’s other filings with the SEC. All information in this release is as of February 25, 2015. Except as required by law, the Company undertakes no obligation to update publicly any forward-looking statement made herein for any reason to conform the statement to actual results or changes in the Company’s expectations.

BroadSoft is the leading provider of software and services that enable mobile, fixed-line and cable service providers to offer Unified Communications over their Internet Protocol networks. The Company’s core communications platform enables the delivery of a range of enterprise and consumer calling, messaging and collaboration communication services, including private branch exchanges, video calling, text messaging and converged mobile and fixed-line services.

The financial statements set forth below are not the complete set of the Company’s financial statements for the quarter and the year and are presented below without footnotes. Readers are encouraged to obtain and carefully review BroadSoft’s Annual Report on Form 10-K for the year ended December 31, 2014, including all financial statements contained therein and the footnotes thereto, as filed with the SEC on February 25, 2015. Once filed with the SEC, the Form 10-K may be retrieved from the SEC’s website at www.sec.gov or from BroadSoft’s website at www.broadsoft.com.



	December 31, 2014			December 31, 2013
	(Unaudited)
Assets:
Current assets:
Cash and cash equivalents	$	101,543		$	69,866
Short-term investments	68,923			93,664
Accounts receivable, net of allowance for doubtful accounts of $286 and $128 at December 31, 2014 and December 31, 2013, respectively	81,794			66,595
Deferred tax assets, current	14,302			4,559
Other current assets	12,678			12,597
Total current assets	279,240			247,281
Long-term assets:
Property and equipment, net	14,363			10,110
Long-term investments	52,030			23,340
Restricted cash	17			581
Intangible assets, net	15,568			20,390
Goodwill	65,303			65,192
Deferred tax assets	10,495			16,482
Other long-term assets	8,279			8,121
Total long-term assets	166,055			144,216
Total assets	$	445,295		$	391,497
Liabilities and stockholders’ equity:
Current liabilities:
Accounts payable and accrued expenses	$	21,222		$	14,957
Deferred revenue, current portion	87,423			71,258
Total current liabilities	108,645			86,215
Convertible senior notes	97,049			91,549
Deferred revenue	14,033			6,404
Deferred tax liabilities	1,289			3,506
Other long-term liabilities	4,030			3,312
Total liabilities	225,046			190,986
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value per share; 5,000,000 shares authorized at December 31, 2014 and December 31, 2013; no shares issued and outstanding at December 31, 2014 and December 31, 2013	—			—
Common stock, par value $0.01 per share; 100,000,000 shares authorized at December 31, 2014 and December 31, 2013; 28,943,336 and 28,305,143 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively	290			283
Additional paid-in capital	279,642			254,736
Accumulated other comprehensive loss	(7,712		)	(1,525		)
Accumulated deficit	(51,971		)	(52,983		)
Total stockholders’ equity	220,249			200,511
Total liabilities and stockholders’ equity	$	445,295		$	391,497



	Three Months Ended December 31,					Year Ended December 31,
	2014		2013			2014			2013
	(Unaudited)					(Unaudited)
Revenue:
License software	$	34,841	$	27,349		$	103,311		$	94,408
Subscription and maintenance support	25,192		20,172			92,492			69,357
Professional services and other	5,793		4,438			21,054			14,728
Total revenue	65,826		51,959			216,857			178,493
Cost of revenue:
License software	2,528		2,405			9,667			9,241
Subscription and maintenance support	8,896		6,353			33,232			21,368
Professional services and other	3,360		2,550			14,814			10,771
Total cost of revenue	14,784		11,308			57,713			41,380
Gross profit	51,042		40,651			159,144			137,113
Operating expenses:
Sales and marketing	18,481		17,792			69,681			62,174
Research and development	12,309		12,535			49,515			49,696
General and administrative	7,496		8,675			32,729			32,728
Total operating expenses	38,286		39,002			151,925			144,598
Income (loss) from operations	12,756		1,649			7,219			(7,485		)
Other expense:
Interest expense, net	1,797		1,757			7,177			6,946
Other, net	562		(71		)	1,300			(148		)
Total other expense, net	2,359		1,686			8,477			6,798
Income (loss) before income taxes	10,397		(37		)	(1,258		)	(14,283		)
Provision for (benefit from) income taxes	1,306		(549		)	(2,270		)	(5,409		)
Net income (loss)	$	9,091	$	512		$	1,012		$	(8,874	)
Net income (loss) per common share:
Basic	$	0.32	$	0.02		$	0.04		$	(0.32	)
Diluted	$	0.30	$	0.02		$	0.03		$	(0.32	)
Weighted average common shares outstanding:
Basic	28,853		28,272			28,654			28,116
Diluted	29,948		29,500			29,917			28,116
Stock-based compensation expense included above:
Cost of revenue	$	1,120	$	1,305		$	3,881		$	4,861
Sales and marketing	1,923		3,932			10,066			14,336
Research and development	2,036		3,367			9,554			13,225
General and administrative	680		2,358			6,127			9,262



	Three Months Ended December 31,				Year ended December 31,
	2014		2013		2014		2013		2012
	(in thousands)				(in thousands)
Beginning of period deferred revenue balance	$	82,848	$	57,686	$	77,662	$	61,149	$	57,136
End of period deferred revenue balance	101,456		77,662		101,456		77,662		61,149
Increase in deferred revenue	18,608		19,976		23,794		16,513		4,013
Revenue	65,826		51,959		216,857		178,493		164,842
Revenue plus net change in deferred revenue	84,434		71,935		240,651		195,006		168,855



	Three Months Ended December 31,				Year ended December 31,
	2014		2013		2014		2013		2012
	(in thousands)				(in thousands)
Beginning of period deferred license software revenue balance	$	24,179	$	14,515	$	20,149	$	18,375	$	20,608
End of period deferred license software revenue balance	26,495		20,149		26,495		20,149		18,375
Increase (decrease) in deferred license software revenue	2,316		5,634		6,346		1,774		(2,233		)
License software revenue	34,841		27,349		103,311		94,408		89,750
License software revenue plus net change in deferred license software revenue	$	37,157	$	32,983	$	109,657	$	96,182	$	87,517



	Three Months Ended December 31,				Year ended December 31,
	2014		2013		2014		2013		2012
	(in thousands)				(in thousands)
Beginning of period deferred subscription and maintenance support revenue balance	$	42,978	$	33,579	$	46,975	$	35,701	$	29,295
End of period deferred subscription and maintenance support revenue balance	52,764		46,975		52,764		46,975		35,701
Increase in deferred subscription and maintenance support revenue	9,786		13,396		5,789		11,274		6,406
Subscription and maintenance support revenue	25,192		20,172		92,492		69,357		58,249
Subscription and maintenance support revenue plus net change in deferred subscription and maintenance support revenue	34,978		33,568		98,281		80,631		64,655



	Three Months Ended December 31,				Year ended December 31,
	2014		2013		2014		2013		2012
	(in thousands)				(in thousands)
Beginning of period deferred professional services and other revenue balance	$	15,691	$	9,592	$	10,538	$	7,073	$	7,233
End of period deferred professional services and other revenue balance	22,197		10,538		22,197		10,538		7,073
Increase (decrease) in deferred professional services and other revenue	6,506		946		11,659		3,465		(160		)
Professional services and other revenue	5,793		4,438		21,054		14,728		16,843
Professional services and other revenue plus net change in deferred professional services and other revenue	$	12,299	$	5,384	$	32,713	$	18,193	$	16,683



	Three Months Ended December 31,						Three Months Ended September 30,			Year Ended December 31,
	2014			2013			2014			2014			2013
	(in thousands)
Non-GAAP cost of revenue:
GAAP license cost of revenue	$	2,528		$	2,405		$	2,488		$	9,667		$	9,241
(percent of related revenue)	7		%	9		%	10		%	9		%	10		%
Less:
Stock-based compensation expense	121			266			114			649			1,098
Amortization of acquired intangible assets	196			228			223			871			856
Non-GAAP license cost of revenue	$	2,211		$	1,911		$	2,151		$	8,147		$	7,287
(percent of related revenue)	6		%	7		%	8		%	8		%	8		%


GAAP subscription and maintenance support cost of revenue	$	8,896		$	6,353		$	8,284		$	33,232		$	21,368
(percent of related revenue)	35		%	31		%	34		%	36		%	31		%
Less:
Stock-based compensation expense	856			748			469			2,535			2,663
Amortization of acquired intangible assets	1,040			1,006			1,132			4,520			3,023
Non-GAAP subscription and maintenance support cost of revenue	$	7,000		$	4,599		$	6,683		$	26,177		$	15,682
(percent of related revenue)	28		%	23		%	28		%	28		%	23		%


GAAP professional services and other cost of revenue	$	3,360		$	2,550		$	4,239		$	14,814		$	10,771
(percent of related revenue)	58		%	57		%	90		%	70		%	73		%
Less:
Stock-based compensation expense	143			291			136			697			1,100
Non-GAAP professional services and other cost of revenue	$	3,217		$	2,259		$	4,103		$	14,117		$	9,671
(percent of related revenue)	56		%	51		%	87		%	67		%	66		%



	Three Months Ended December 31,						Three Months Ended September 30,			Year Ended December 31,
	2014			2013			2014			2014			2013
	(in thousands)
Non-GAAP gross profit:
GAAP gross profit	$	51,042		$	40,651		$	39,618		$	159,144		$	137,113
(percent of total revenue)	78		%	78		%	73		%	73		%	77		%
Plus:
Stock-based compensation expense	1,120			1,305			719			3,881			4,861
Amortization of acquired intangible assets	1,236			1,234			1,355			5,391			3,879
Non-GAAP gross profit	$	53,398		$	43,190		$	41,692		$	168,416		$	145,853
(percent of total revenue)	81		%	83		%	76		%	78		%	82		%


GAAP license gross profit	$	32,313		$	24,944		$	23,191		$	93,644		$	85,167
(percent of related revenue)	93		%	91		%	90		%	91		%	90		%
Plus:
Stock-based compensation expense	121			266			114			649			1,098
Amortization of acquired intangible assets	196			228			223			871			856
Non-GAAP license gross profit	$	32,630		$	25,438		$	23,528		$	95,164		$	87,121
(percent of related revenue)	94		%	93		%	92		%	92		%	92		%


GAAP subscription and maintenance support gross profit	$	16,296		$	13,819		$	15,932		$	59,260		$	47,989
(percent of related revenue)	65		%	69		%	66		%	64		%	69		%
Plus:
Stock-based compensation expense	856			748			469			2,535			2,663
Amortization of acquired intangible assets	1,040			1,006			1,132			4,520			3,023
Non-GAAP subscription and maintenance support gross profit	$	18,192		$	15,573		$	17,533		$	66,315		$	53,675
(percent of related revenue)	72		%	77		%	72		%	72		%	77		%


GAAP professional services and other gross profit	$	2,433		$	1,888		$	495		$	6,240		$	3,957
(percent of related revenue)	42		%	43		%	10		%	30		%	27		%
Plus:
Stock-based compensation expense	143			291			136			697			1,100
Non-GAAP professional services and other gross profit	$	2,576		$	2,179		$	631		$	6,937		$	5,057
(percent of related revenue)	44		%	49		%	13		%	33		%	34		%



	Three Months Ended December 31,						Three Months Ended September 30,			Year Ended December 31,
	2014			2013			2014			2014			2013
	(in thousands)
Non-GAAP income from operations:
GAAP income from operations	$	12,756		$	1,649		$	3,215		$	7,219		$	(7,485	)
(percent of total revenue)	19		%	3		%	6		%	3		%	(4		)%
Plus:
Stock-based compensation expense	5,759			10,962			6,105			29,628			41,684
Amortization of acquired intangible assets	1,236			1,234			1,355			5,391			3,879
Non-GAAP income from operations	$	19,751		$	13,845		$	10,675		$	42,238		$	38,078
(percent of total revenue)	30		%	27		%	20		%	19		%	21		%


GAAP operating expense	$	38,286		$	39,002		$	36,403		$	151,925		$	144,598
(percent of total revenue)	58		%	75		%	67		%	70		%	81		%
Less:
Stock-based compensation expense	4,639			9,657			5,386			25,747			36,823
Non-GAAP operating expense	$	33,647		$	29,345		$	31,017		$	126,178		$	107,775
(percent of total revenue)	51		%	56		%	57		%	58		%	60		%


GAAP sales and marketing expense	$	18,481		$	17,792		$	16,198		$	69,681		$	62,174
(percent of total revenue)	28		%	34		%	30		%	32		%	35		%
Less:
Stock-based compensation expense	1,923			3,932			2,164			10,066			14,336
Non-GAAP sales and marketing expense	$	16,558		$	13,860		$	14,034		$	59,615		$	47,838
(percent of total revenue)	25		%	27		%	26		%	27		%	27		%


GAAP research and development expense	$	12,309		$	12,535		$	11,654		$	49,515		$	49,696
(percent of total revenue)	19		%	24		%	21		%	23		%	28		%
Less:
Stock-based compensation expense	2,036			3,367			2,008			9,554			13,225
Non-GAAP research and development expense	$	10,273		$	9,168		$	9,646		$	39,961		$	36,471
(percent of total revenue)	16		%	18		%	18		%	18		%	20		%


GAAP general and administrative expense	$	7,496		$	8,675		$	8,551		$	32,729		$	32,728
(percent of total revenue)	11		%	17		%	16		%	15		%	18		%
Less:
Stock-based compensation expense	680			2,358			1,214			6,127			9,262
Non-GAAP general and administrative expense	$	6,816		$	6,317		$	7,337		$	26,602		$	23,466
(percent of total revenue)	10		%	12		%	13		%	12		%	13		%



	Three Months Ended December 31,						Three Months Ended September 30,			Year Ended December 31,
	2014			2013			2014			2014			2013
	(in thousands, except per share data)
Non-GAAP net income and income per share:
GAAP net income (loss)	$	9,091		$	512		$	(2,292	)	$	1,012		$	(8,874	)
(percent of total revenue)	14		%	1		%	(4		)%	*			(5		)%
Adjusted for:
Stock-based compensation expense	5,759			10,962			6,105			29,628			41,684
Amortization of acquired intangible assets	1,236			1,234			1,355			5,391			3,879
Non-cash interest expense on our notes	1,521			1,416			1,485			5,906			5,504
Foreign currency transaction losses (gains)	562			(71		)	907			1,300			(148		)
Non-cash tax provision (benefit)	917			(819		)	2,581			(3,089		)	(6,142		)
Non-GAAP net income	$	19,086		$	13,234		$	10,141		$	40,148		$	35,903
(percent of total revenue)	29		%	25		%	19		%	19		%	20		%


GAAP net income (loss) per basic common share	$	0.32		$	0.02		$	(0.08	)	$	0.04		$	(0.32	)
Adjusted for:
Stock-based compensation expense	0.20			0.39			0.21			1.03			1.48
Amortization of acquired intangible assets	0.04			0.04			0.05			0.19			0.14
Non-cash interest expense on our notes	0.05			0.05			0.05			0.21			0.20
Foreign currency transaction losses (gains)	0.02			—			0.03			0.05			(0.01		)
Non-cash tax provision (benefit)	0.03			(0.03		)	0.09			(0.11		)	(0.22		)
Non-GAAP net income per basic common share	$	0.66		$	0.47		$	0.35		$	1.40		$	1.28


GAAP net income (loss) per diluted common share	$	0.30		$	0.02		$	(0.08	)	$	0.03		$	(0.32	)
Adjusted for:
Stock-based compensation expense	0.19			0.37			0.20			0.99			1.44
Amortization of acquired intangible assets	0.04			0.04			0.05			0.18			0.14
Non-cash interest expense on our notes	0.05			0.05			0.05			0.20			0.19
Foreign currency transaction losses (gains)	0.02			—			0.03			0.04			(0.01		)
Non-cash tax provision (benefit)	0.03			(0.03		)	0.09			(0.10		)	(0.21		)
Non-GAAP net income per diluted common share ^	$	0.64		$	0.45		$	0.34		$	1.34		$	1.24

^ For the full year ended December 31, 2013 and the three months ended September 30, 2014, the non-GAAP net income per diluted common share calculation included the dilutive effect of stock-based awards on the weighted average diluted common shares outstanding (such stock-based awards were not reflected in the corresponding GAAP diluted share calculations, as their effect would have been anti-dilutive as a result of the net losses for this periods). Total diluted weighted average common shares outstanding used for calculating non-GAAP net income per diluted common share were 29,060 thousand for the year ended December 31, 2013 and were 29,852 thousand for the three months ended September 30, 2014.



	Year ended December 31,
	2014			2013			2012
	(Unaudited)
Cash provided by (used in):
Operating activities	$	54,759		$	31,934		$	30,019
Investing activities	(17,558		)	(57,406		)	(34,153		)
Financing activities	(4,135		)	4,831			458


•	Total revenue increased 27% year-over-year to $65.8 million


•	GAAP gross profit equaled 78% of total revenue; non-GAAP gross profit equaled 81% of total revenue


•	GAAP income from operations totaled $12.8 million or 19% of revenue; non-GAAP income from operations totaled $19.8 million or 30% of revenue


•	GAAP diluted earnings per share equaled $0.30 per common share; non-GAAP diluted earnings per share equaled $0.64 per common share