Delaware | 42-1515522 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
325 Lytton Avenue, Suite 200, Palo Alto, California | 94301 | |
(Address of principal executive offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Date: | November 1, 2016 | JIVE SOFTWARE, INC. | ||
By: | /s/ Bryan J. LeBlanc | |||
Bryan J. LeBlanc | ||||
EVP and Chief Financial Officer |
• | Revenue: Total revenue for the third quarter was $50.7 million, an increase of 2% on a year-over-year basis. Within total revenue, product revenue was $46.6 million for the third quarter, an increase of 2% on a year-over-year basis. Professional services revenue for the third quarter was $4.1 million, an increase of 3% on a year-over-year basis. |
• | Non-GAAP Billings: Short-term billings, which Jive defines as revenue plus the change in short-term deferred revenue, were $48.3 million for the third quarter, an increase of 1% year-over-year. Total billings, which Jive defines as revenue plus the change in short and long-term deferred revenue, was $46.8 million, an increase of 8% on a year-over-year basis. |
• | Gross Profit: GAAP gross profit for the third quarter was $34.6 million, an increase of 9% year-over-year, and GAAP gross margin was 68%. Non-GAAP gross profit was $35.5 million for the third quarter, an increase of 6% year-over-year, and non-GAAP gross margin was 70%. |
• | Loss from Operations: GAAP loss from operations for the third quarter was $603,000, compared to a loss from operations of $8.8 million for the third quarter of 2015. Non-GAAP income from operations was $3.8 million, compared to non-GAAP loss from operations of $2.2 million for the third quarter of 2015. |
• | Net Loss: GAAP net loss for the third quarter was $745,000, compared to a net loss of $8.8 million for the same period last year. GAAP net loss per share for the third quarter was $0.01, based on 77.9 million weighted-average shares outstanding, compared to a net loss per share of $0.12, based on 75.6 million weighted-average shares outstanding, for the same period last year. |
• | Balance Sheet and Cash Flow: As of September 30, 2016, Jive had cash and cash equivalents and marketable securities of $102.5 million, compared to $112.7 million as of December 31, 2015. Cash used by operations was $4.7 million and Jive used $0.4 million to purchase capital expenditures and finance capital leases, leading to negative free cash flow of $5.1 million for the third quarter of 2016, compared to negative free cash flow of $6.3 million for the third quarter of 2015. Free cash flow is defined as cash flows provided by operating activities minus cash flows used to purchase capital expenditures and finance capital leases. |
• | Achieved new customer wins with Close Brothers Group Plc, Clyde and Co., Corning Museum of Glass, First Home Mortgage, Ford Motor Company, Fraunhofer IAO, hc1.com, Logicor, M3 Insurance Solutions, National Council of Architectural Registration Boards (NCARB), Positivo Informática, SIEMonster Inc., STMicroelectronics, Tampa Bay Sports and Entertainment, and Truth Initiative, among others. |
• | Expanded or renewed customer relationships with ADEO Services, Athenahealth, Inc., CA Technologies, Credit Suisse, Department of Justice, Detroit Diesel Corporation, Driven Brands, Inc., EMC Corporation, FICO, Fidelity Investments, FireEye, HomeAway, Leidos, MD Anderson Physicians Network, Medidata Solutions, National Archives, National Instruments, Pearson Inc., PEO C3T - a division of the U.S. Army, Ricoh Group, ServiceNow, Shaw Communications Inc., SolarWinds, Starwood Hotels, Swedish Partners Medical Group, Tableau Software, Inc. and Windstream Corporation, among others. |
• | Jive’s Interactive Intranet solution was named the winner of the Gold Stevie Award in the Best New Product category for big data solutions by the 13th Annual International Business Awards. The International Business Awards is a premier business awards program that honors the achievements of organizations and professionals. This year there was a record total of more than 3,800 nominations in a wide range of categories from more than 60 countries. Jive’s Interactive Intranet was recognized for specific innovations including analytics, search and personalization services that seamlessly pull together the right experts, content and interactions across any apps or devices an employee prefers. Jive was also recognized for its state-of-the-art recommender engine, which helps companies drive employee engagement by leveraging machine-learning insights to uncover the most relevant digital workplace experiences and content. |
• | Jive was ranked as a Leader in The Aragon Research Globe™ for Social Software, 2016: Shifting to Work and Outcomes report for the third consecutive year. Aragon Research evaluated 21 global enterprise social networking (ESN) vendors for this year's report, and recognized Jive for its strong partner ecosystem, powerful analytics and continued momentum behind new innovation. |
• | Fourth Quarter 2016 Guidance: |
• | Total revenue is expected to be in the range of $49.5 million to $50.5 million. |
• | Non-GAAP income from operations is expected to be in the range of $2.0 million to $3.0 million. |
• | Non-GAAP earnings per share are expected to be in the range of $0.02 to $0.04 based on approximately 81.2 million weighted-average diluted shares outstanding. |
• | Change in short-term billings is expected to be in the range of 0% to 5%. |
• | Free cash flow is expected to be in the range of $3.0 million to $5.0 million. |
• | Full Year 2016 Guidance: |
• | Total revenue is expected to be in the range of $201.9 million to $202.9 million. |
• | Non-GAAP income from operations is expected to be in the range of $5.4 million to $6.4 million. |
• | Non-GAAP earnings per share are expected to be in the range of $0.06 to $0.07 based on approximately 80.2 million weighted-average diluted shares outstanding. |
• | Change in short-term billings is expected to be in the range of negative 2% to negative 1%. |
• | Free cash flow is expected to be in the range of negative $4.6 million to negative $2.6 million. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues: | |||||||||||||||
Product | $ | 46,659 | $ | 45,960 | $ | 139,730 | $ | 133,628 | |||||||
Professional services | 4,062 | 3,945 | 12,669 | 12,014 | |||||||||||
Total revenues | 50,721 | 49,905 | 152,399 | 145,642 | |||||||||||
Cost of revenues: | |||||||||||||||
Product | 11,605 | 12,623 | 36,620 | 36,630 | |||||||||||
Professional services | 4,473 | 5,542 | 15,237 | 16,912 | |||||||||||
Total cost of revenues | 16,078 | 18,165 | 51,857 | 53,542 | |||||||||||
Gross profit | 34,643 | 31,740 | 100,542 | 92,100 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 10,990 | 13,187 | 34,565 | 40,737 | |||||||||||
Sales and marketing | 17,920 | 20,172 | 57,021 | 57,996 | |||||||||||
General and administrative | 6,420 | 7,141 | 19,296 | 20,420 | |||||||||||
Restructuring | (84 | ) | — | 4,029 | — | ||||||||||
Total operating expenses | 35,246 | 40,500 | 114,911 | 119,153 | |||||||||||
Loss from operations | (603 | ) | (8,760 | ) | (14,369 | ) | (27,053 | ) | |||||||
Other income (expense), net: | |||||||||||||||
Interest income | 143 | 72 | 395 | 192 | |||||||||||
Interest expense | (35 | ) | (27 | ) | (116 | ) | (149 | ) | |||||||
Other, net | (25 | ) | (1 | ) | 218 | 1,036 | |||||||||
Total other income, net | 83 | 44 | 497 | 1,079 | |||||||||||
Loss before provision for income taxes | (520 | ) | (8,716 | ) | (13,872 | ) | (25,974 | ) | |||||||
Provision for income taxes | 225 | 113 | 1,007 | 330 | |||||||||||
Net loss | $ | (745 | ) | $ | (8,829 | ) | $ | (14,879 | ) | $ | (26,304 | ) | |||
Basic and diluted net loss per share | $ | (0.01 | ) | $ | (0.12 | ) | $ | (0.19 | ) | $ | (0.35 | ) | |||
Shares used in basic and diluted per share calculations | 77,902 | 75,632 | 77,179 | 74,922 |
September 30, 2016 | December 31, 2015 | ||||||
Assets | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 7,062 | $ | 9,870 | |||
Short-term marketable securities | 94,390 | 96,410 | |||||
Accounts receivable, net of allowances | 39,365 | 54,090 | |||||
Prepaid expenses and other current assets | 13,868 | 13,135 | |||||
Total current assets | 154,685 | 173,505 | |||||
Marketable securities, noncurrent | 1,004 | 6,429 | |||||
Property and equipment, net of accumulated depreciation | 9,878 | 12,747 | |||||
Goodwill | 29,753 | 29,753 | |||||
Intangible assets, net of accumulated amortization | 2,384 | 4,546 | |||||
Other assets | 5,635 | 8,165 | |||||
Total assets | $ | 203,339 | $ | 235,145 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 1,827 | $ | 3,684 | |||
Accrued payroll and related liabilities | 8,833 | 6,954 | |||||
Other accrued liabilities | 6,435 | 7,842 | |||||
Deferred revenue, current | 113,775 | 131,850 | |||||
Term debt, current | 1,800 | 2,400 | |||||
Total current liabilities | 132,670 | 152,730 | |||||
Deferred revenue, less current portion | 8,669 | 16,392 | |||||
Term debt, less current portion | — | 1,200 | |||||
Other long-term liabilities | 2,781 | 2,682 | |||||
Total liabilities | 144,120 | 173,004 | |||||
Stockholders’ Equity: | |||||||
Common stock | 7 | 7 | |||||
Less treasury stock at cost | (3,352 | ) | (3,352 | ) | |||
Additional paid-in capital | 396,302 | 384,164 | |||||
Accumulated deficit | (333,416 | ) | (318,537 | ) | |||
Accumulated other comprehensive income loss | (322 | ) | (141 | ) | |||
Total stockholders’ equity | 59,219 | 62,141 | |||||
Total liabilities and stockholders’ equity | $ | 203,339 | $ | 235,145 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net loss | $ | (745 | ) | $ | (8,829 | ) | $ | (14,879 | ) | $ | (26,304 | ) | |||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||||||||||
Depreciation and amortization | 2,841 | 3,907 | 9,531 | 11,871 | |||||||||||
Stock-based compensation | 4,090 | 5,477 | 11,599 | 16,765 | |||||||||||
Change in deferred taxes | 180 | 32 | 175 | 95 | |||||||||||
Non-recurring gain | — | — | — | (1,107 | ) | ||||||||||
Other | 101 | — | 175 | — | |||||||||||
Decrease (increase) in: | |||||||||||||||
Accounts receivable, net | (5,443 | ) | (351 | ) | 14,725 | 19,692 | |||||||||
Prepaid expenses and other assets | (1,870 | ) | (323 | ) | (199 | ) | (664 | ) | |||||||
Increase (decrease) in: | |||||||||||||||
Accounts payable | (1,489 | ) | 1,698 | (1,744 | ) | 4,155 | |||||||||
Accrued payroll and related liabilities | 505 | (1,298 | ) | 2,471 | (779 | ) | |||||||||
Other accrued liabilities | 923 | 1,443 | (1,586 | ) | (207 | ) | |||||||||
Deferred revenue | (3,929 | ) | (6,617 | ) | (25,798 | ) | (19,265 | ) | |||||||
Other long-term liabilities | 173 | 3 | 4 | 282 | |||||||||||
Net cash provided by (used in) operating activities | (4,663 | ) | (4,858 | ) | (5,526 | ) | 4,534 | ||||||||
Cash flows from investing activities: | |||||||||||||||
Payments for purchase of property and equipment | (395 | ) | (1,440 | ) | (2,042 | ) | (4,783 | ) | |||||||
Purchases of marketable securities | (20,719 | ) | (23,688 | ) | (60,143 | ) | (81,445 | ) | |||||||
Sales of marketable securities | — | 6,601 | 1,001 | 17,903 | |||||||||||
Maturities of marketable securities | 22,700 | 21,299 | 66,098 | 61,101 | |||||||||||
Net cash provided by (used in) investing activities | 1,586 | 2,772 | 4,914 | (7,224 | ) | ||||||||||
Cash flows from financing activities: | |||||||||||||||
Proceeds from exercise of stock options | 13 | 285 | 318 | 1,073 | |||||||||||
Taxes paid related to net share settlement of equity awards | (273 | ) | (194 | ) | (648 | ) | (789 | ) | |||||||
Capital lease payments | (49 | ) | — | (80 | ) | — | |||||||||
Repayments of term loans | (600 | ) | (600 | ) | (1,800 | ) | (1,800 | ) | |||||||
Non-recurring gain | — | — | — | 1,107 | |||||||||||
Net cash used in financing activities | (909 | ) | (509 | ) | (2,210 | ) | (409 | ) | |||||||
Net decrease in cash and cash equivalents | (3,986 | ) | (2,595 | ) | (2,822 | ) | (3,099 | ) | |||||||
Effect of exchange rate changes | (14 | ) | 3 | 14 | (44 | ) | |||||||||
Cash and cash equivalents, beginning of period | 11,062 | 20,043 | 9,870 | 20,594 | |||||||||||
Cash and cash equivalents, end of period | $ | 7,062 | $ | 17,451 | $ | 7,062 | $ | 17,451 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Gross profit, as reported | $ | 34,643 | $ | 31,740 | $ | 100,542 | $ | 92,100 | |||||||
Add back: | |||||||||||||||
Stock-based compensation | 487 | 734 | 1,676 | 2,388 | |||||||||||
Amortization related to acquisitions | 406 | 905 | 1,966 | 2,788 | |||||||||||
Gross profit, non-GAAP | $ | 35,536 | $ | 33,379 | $ | 104,184 | $ | 97,276 | |||||||
Gross margin, non-GAAP | 70 | % | 67 | % | 68 | % | 67 | % | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Research and development, as reported | $ | 10,990 | $ | 13,187 | $ | 34,565 | $ | 40,737 | |||||||
Less: | |||||||||||||||
Stock-based compensation | 979 | 1,644 | 2,819 | 5,997 | |||||||||||
Amortization related to acquisitions | — | 61 | 52 | 649 | |||||||||||
Research and development, non-GAAP | $ | 10,011 | $ | 11,482 | $ | 31,694 | $ | 34,091 | |||||||
As percentage of total revenues, non-GAAP | 20 | % | 23 | % | 21 | % | 23 | % | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Sales and marketing, as reported | $ | 17,920 | $ | 20,172 | $ | 57,021 | $ | 57,996 | |||||||
Less: | |||||||||||||||
Stock-based compensation | 867 | 1,164 | 2,522 | 2,958 | |||||||||||
Amortization related to acquisitions | 17 | 129 | 143 | 388 | |||||||||||
Sales and marketing, non-GAAP | $ | 17,036 | $ | 18,879 | $ | 54,356 | $ | 54,650 | |||||||
As percentage of total revenues, non-GAAP | 34 | % | 38 | % | 36 | % | 38 | % | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
General and administrative, as reported | $ | 6,420 | $ | 7,141 | $ | 19,296 | $ | 20,420 | |||||||
Less: | |||||||||||||||
Stock-based compensation | 1,757 | 1,937 | 4,555 | 5,426 | |||||||||||
General and administrative, non-GAAP | $ | 4,663 | $ | 5,204 | $ | 14,741 | $ | 14,994 | |||||||
As percentage of total revenues, non-GAAP | 9 | % | 10 | % | 10 | % | 10 | % | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Loss from operations, as reported | $ | (603 | ) | $ | (8,760 | ) | $ | (14,369 | ) | $ | (27,053 | ) | |||
Add back: | |||||||||||||||
Stock-based compensation | 4,090 | 5,479 | 11,572 | 16,769 | |||||||||||
Amortization related to acquisitions | 423 | 1,095 | 2,161 | 3,825 | |||||||||||
Restructuring charges | (84 | ) | — | 4,029 | — | ||||||||||
Income (loss) from operations, non-GAAP | $ | 3,826 | $ | (2,186 | ) | $ | 3,393 | $ | (6,459 | ) | |||||
As percentage of total revenues, non-GAAP | 8 | % | (4 | )% | 2 | % | (4 | )% | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Loss before provision for income taxes, as reported | $ | (520 | ) | $ | (8,716 | ) | $ | (13,872 | ) | $ | (25,974 | ) | |||
Add back: | |||||||||||||||
Stock-based compensation | 4,090 | 5,479 | 11,572 | 16,769 | |||||||||||
Amortization related to acquisitions | 423 | 1,095 | 2,161 | 3,825 | |||||||||||
Restructuring charges | (84 | ) | — | 4,029 | — | ||||||||||
Less: | |||||||||||||||
Non-recurring gain | — | — | — | (1,107 | ) | ||||||||||
Income (loss) before provision for income taxes, non-GAAP | $ | 3,909 | $ | (2,142 | ) | $ | 3,890 | $ | (6,487 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net loss, as reported | $ | (745 | ) | $ | (8,829 | ) | $ | (14,879 | ) | $ | (26,304 | ) | |||
Add back: | |||||||||||||||
Stock-based compensation | 4,090 | 5,479 | 11,572 | 16,769 | |||||||||||
Amortization related to acquisitions | 423 | 1,095 | 2,161 | 3,825 | |||||||||||
Restructuring charges | (84 | ) | — | 4,029 | |||||||||||
Less: | |||||||||||||||
Non-recurring gain | — | — | — | (1,107 | ) | ||||||||||
Net income (loss), non-GAAP | $ | 3,684 | $ | (2,255 | ) | $ | 2,883 | $ | (6,817 | ) | |||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
GAAP weighted average diluted shares | 77,902 | 75,632 | 77,179 | 74,922 | |||||||||||
Dilutive equity awards included in non-GAAP earnings per share | 2,426 | — | 2,095 | — | |||||||||||
Non-GAAP weighted average diluted shares | 80,328 | 75,632 | 79,274 | 74,922 | |||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Diluted net loss per share, as reported | $ | (0.01 | ) | $ | (0.12 | ) | $ | (0.19 | ) | $ | (0.35 | ) | |||
Add back: | |||||||||||||||
Stock-based compensation | 0.05 | 0.07 | 0.15 | 0.22 | |||||||||||
Amortization related to acquisitions | 0.01 | 0.01 | 0.03 | 0.05 | |||||||||||
Restructuring charges | — | — | 0.05 | — | |||||||||||
Less: | |||||||||||||||
Non-recurring gain | — | — | — | (0.01 | ) | ||||||||||
Diluted net income (loss) per share, non-GAAP (1) | $ | 0.05 | $ | (0.03 | ) | $ | 0.04 | $ | (0.09 | ) | |||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Total revenues | $ | 50,721 | $ | 49,905 | $ | 152,399 | $ | 145,642 | |||||||
Deferred revenue, current, end of period | 113,775 | 121,752 | 113,775 | 121,752 | |||||||||||
Less: Deferred revenue, current, beginning of period | (116,218 | ) | (123,779 | ) | (131,850 | ) | (128,592 | ) | |||||||
Short-term billings | $ | 48,278 | $ | 47,878 | $ | 134,324 | $ | 138,802 | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Total revenues | $ | 50,721 | $ | 49,905 | $ | 152,399 | $ | 145,642 | |||||||
Deferred revenue, end of period | 122,444 | 141,274 | 122,444 | 141,274 | |||||||||||
Less: Deferred revenue, beginning of period | (126,373 | ) | (147,891 | ) | (148,242 | ) | (160,539 | ) | |||||||
Billings | $ | 46,792 | $ | 43,288 | $ | 126,601 | $ | 126,377 | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Cash flows provided by (used in) operating activities | $ | (4,663 | ) | $ | (4,858 | ) | $ | (5,526 | ) | $ | 4,534 | ||||
Payments for purchase of property and equipment | (395 | ) | (1,440 | ) | (2,042 | ) | (4,783 | ) | |||||||
Capital lease payments | (49 | ) | — | (80 | ) | — | |||||||||
Free cash flow | $ | (5,107 | ) | $ | (6,298 | ) | $ | (7,648 | ) | $ | (249 | ) |
(1) | Per share amounts may not add due to rounding. |