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Third fiscal quarter of 2013 and recent strategic highlights include:
"I am pleased with the operational performance during the third quarter as we continue to invest in our opportunity as a company, said
Third Fiscal Quarter of 2013 Financial Details
Revenue:
Adjusted EBITDA: Adjusted EBITDA was a loss of
GAAP net loss and net loss per share: GAAP net loss was
Non-GAAP net loss and net loss per share: Non-GAAP net loss was
Clients: The number of active enterprise clients at the end of the third quarter was 1,179, and the number of active network clients at the end of the third quarter was approximately 1,250. Annualized SaaS revenue per average active enterprise client for the third quarter was approximately
In connection with our acquisition of PowerReviews, which closed in
Quarterly Conference Call
About
The
Number of Active Enterprise Clients
We define an active enterprise client as an organization that has implemented either the Bazaarvoice Conversations platform or the PowerReviews Enterprise platform and from which we are currently recognizing revenue, and we count organizations that are closely related as one client, even if they have signed separate contractual agreements. We believe that our ability to increase our enterprise client base is a leading indicator of our ability to grow revenue.
Number of Active Network Clients
We define an active network client as an organization that has implemented one or more of our solutions but has not implemented either the Bazaarvoice Conversations or PowerReviews Enterprise platforms. Such solutions may include our Connections solutions, Media solutions or Express platform. We count organizations that are closely related as one client, even if they have signed separate contractual agreements. We believe that our network client base in combination with our enterprise client base is an indicator of the reach of our network.
Non-GAAP Financial Measures
Adjusted EBITDA discussed in this press release is defined as net loss adjusted for stock-based expense, adjusted depreciation and amortization (which excludes amortization of capitalized internal-use software development costs), integration and other costs related to acquisitions, income tax expense and other (income) expense, net. Non-GAAP net loss, which is used to calculate non-GAAP net loss per share, is defined as our GAAP net loss adjusted to exclude stock-based expense, amortization of acquired intangible assets, integration and other costs related to acquisitions along with the associated income tax effect of these adjustments. Non-GAAP basic and diluted loss per share for the third fiscal quarter of 2012 ended
Forward-looking Statements
This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and objectives of management are forward-looking statements. The words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "will," "would" and similar and "target" expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, our ability to address the strategic priorities of our clients, including our ability to deliver more online word of mouth content, site monetization and tools to increase traffic and conversion.
We may not actually achieve the expectations disclosed in the forward-looking statements, and you should not place undue reliance on our forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results or events to differ materially from the expectations disclosed in the forward-looking statements, including, but not limited to, our expectations regarding our revenue, expenses, sales and operations; our limited operating history; our ability to integrate the operations of
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| Condensed Consolidated Balance Sheets | ||
| (unaudited) | ||
| (in thousands) | ||
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| 2013 | 2012 | |
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $ 23,845 | $ 74,367 |
| Restricted cash | 604 | 500 |
| Short-term investments | 81,646 | 50,834 |
| Accounts receivable, net | 30,310 | 17,977 |
| Prepaid expenses and other current assets | 4,624 | 3,873 |
| Total current assets | 141,029 | 147,551 |
| Property, equipment and capitalized internal-use software development costs, net | 13,431 | 8,868 |
| Goodwill | 141,833 | -- |
| Acquired intangible assets, net | 53,465 | -- |
| Other non-current assets | 190 | 448 |
| Total assets | $ 349,948 | $ 156,867 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable | $ 6,189 | $ 2,523 |
| Accrued expenses and other current liabilities | 23,289 | 12,725 |
| Deferred revenue | 50,755 | 42,152 |
| Total current liabilities | 80,233 | 57,400 |
| Deferred revenue less current portion | 2,162 | 3,434 |
| Deferred tax liability, long-term | 1,393 | 31 |
| Other liabilities, long-term | 6,836 | 2,404 |
| Total liabilities | 90,624 | 63,269 |
| Stockholders' equity: | ||
| Common stock | 7 | 6 |
| Additional paid-in capital | 365,115 | 158,769 |
| Accumulated other comprehensive loss | (33) | (20) |
| Accumulated deficit | (105,765) | (65,157) |
| Total stockholders' equity | 259,324 | 93,598 |
| Total liabilities and stockholders' equity | $ 349,948 | $ 156,867 |
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| Condensed Consolidated Statements of Operations | ||||
| (unaudited) | ||||
| (in thousands, except net loss per share data) | ||||
| Three Months | Nine Months | |||
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Ended |
Ended |
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| 2013 | 2012 | 2013 | 2012 | |
| Revenue | $ 42,678 | $ 27,602 | $ 116,966 | $ 74,705 |
| Cost of revenue | 14,217 | 9,514 | 40,949 | 26,116 |
| Gross profit | 28,461 | 18,088 | 76,017 | 48,589 |
| Operating expenses: | ||||
| Sales and marketing | 20,710 | 12,152 | 53,882 | 35,469 |
| Research and development | 8,914 | 6,059 | 24,356 | 13,978 |
| General and administrative | 8,783 | 5,934 | 32,463 | 15,848 |
| Acquisition-related and other | 2,021 | -- | 4,771 | -- |
| Amortization of acquired intangible assets | 1,165 | -- | 2,543 | -- |
| Total operating expenses | 41,593 | 24,145 | 118,015 | 65,295 |
| Operating loss | (13,132) | (6,057) | (41,998) | (16,706) |
| Other income (expense), net: | ||||
| Interest income | 61 | 4 | 110 | 17 |
| Other income (expense) | (49) | (341) | (451) | (805) |
| Total other income (expense), net | 12 | (337) | (341) | (788) |
| Loss before income taxes | (13,120) | (6,394) | (42,339) | (17,494) |
| Income tax expense (benefit) | (2,293) | 181 | (1,731) | 468 |
| Net loss | $ (10,827) | $ (6,575) | $ (40,608) | $ (17,962) |
| Accretion of redeemable convertible preferred stock | -- | (10) | -- | (35) |
| Net loss applicable to common stockholders | $ (10,827) | $ (6,585) | $ (40,608) | $ (17,997) |
| Net loss per share applicable to common stockholders: | ||||
| Basic and diluted | $ (0.15) | $ (0.34) | $ (0.60) | $ (0.93) |
| Basic and diluted weighted average number of shares outstanding | 71,940 | 19,613 | 68,115 | 19,284 |
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| Condensed Consolidated Statements of Cash Flows | ||||
| (unaudited) | ||||
| (in thousands) | ||||
| Three Months | Nine Months | |||
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Ended |
Ended |
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| 2013 | 2012 | 2013 | 2012 | |
| OPERATING ACTIVITIES | ||||
| Net loss | $ (10,827) | $ (6,575) | $ (40,608) | $ (17,962) |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||
| Depreciation and amortization expense | 3,138 | 837 | 7,473 | 2,247 |
| Stock-based expense | 3,139 | 2,503 | 19,072 | 5,758 |
| Bad debt expense | 860 | 78 | 1,643 | 925 |
| Excess tax benefit related to stock-based compensation | (93) | -- | (365) | -- |
| Changes in operating assets and liabilities: | ||||
| Accounts receivable | (5,781) | (2,888) | (10,581) | (8,394) |
| Prepaid expenses and other current assets | 485 | 1,606 | 257 | 529 |
| Other non-current assets | 1,277 | (148) | 1,161 | (361) |
| Accounts payable | (2,655) | (222) | 521 | 2,005 |
| Accrued expenses and other current liabilities | 4,493 | 937 | 7,027 | 5,125 |
| Deferred revenue | 3,313 | 2,764 | 4,647 | 9,971 |
| Other liabilities, long-term | (4,090) | (262) | (2,952) | 1 |
| Net cash used in operating activities | (6,741) | (1,370) | (12,705) | (156) |
| INVESTING ACTIVITIES | ||||
| Acquisitions, net of cash acquired, and purchase of intangible asset | (30,437) | -- | (60,750) | -- |
| Purchases of property, equipment and capitalized internal-use software development costs | (2,173) | (986) | (8,004) | (3,806) |
| Purchases of short-term investments | (7,861) | -- | (74,578) | -- |
| Proceeds from sale of short-term investments | 22,618 | -- | 43,783 | -- |
| Increase in restricted cash | -- | -- | -- | (250) |
| Net cash used in investing activities | (17,853) | (986) | (99,549) | (4,056) |
| FINANCING ACTIVITIES | ||||
| Payments of initial stock offering costs | -- | (1) | -- | (938) |
| Proceeds from follow-on stock offering, net of costs | -- | -- | 51,943 | -- |
| Proceeds from exercise of stock options | 3,274 | 696 | 9,470 | 2,478 |
| Excess tax benefit related to stock-based compensation | 93 | -- | 365 | -- |
| Net cash provided by financing activities | 3,367 | 695 | 61,778 | 1,540 |
| Effect of exchange rate fluctuations on cash and cash equivalents | (44) | (34) | (46) | (73) |
| Net decrease in cash and cash equivalents | (21,271) | (1,695) | (50,522) | (2,745) |
| Cash and cash equivalents at beginning of period | 45,116 | 14,000 | 74,367 | 15,050 |
| Cash and cash equivalents at end of period | $ 23,845 | $ 12,305 | $ 23,845 | $ 12,305 |
| Supplemental disclosure of other cash flow information: | ||||
| Cash paid for income taxes | $ -- | $ 87 | $ 236 | $ 105 |
| Supplemental disclosure of non-cash investing and financing activities: | ||||
| Accretion of redeemable convertible preferred stock | $ -- | $ 10 | $ -- | $ 35 |
| Accrued stock offering costs | -- | 666 | -- | 1,600 |
| Issuance of stock for acquisition | 5,802 | -- | 125,497 | -- |
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| Reconciliation of GAAP to Non-GAAP Financial Measures | ||||
| (unaudited) | ||||
| (in thousands, except net loss per share data) | ||||
| Three Months | Nine Months | |||
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Ended |
Ended |
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| 2013 | 2012 | 2013 | 2012 | |
| Non-GAAP net loss and net loss per share: | ||||
| GAAP net loss | $ (10,827) | $ (6,575) | $ (40,608) | $ (17,962) |
| Stock-based expense (1) | 3,139 | 2,503 | 19,072 | 5,758 |
| Amortization of acquired intangible assets | 1,615 | -- | 3,683 | -- |
| Acquisition-related and other expense | 2,021 | -- | 4,771 | -- |
| Income tax adjustment for non-GAAP items | (34) | -- | 25 | -- |
| Non-GAAP net loss | $ (4,086) | $ (4,072) | $ (13,057) | $ (12,204) |
| GAAP basic and diluted shares | 71,940 | 19,613 | 68,115 | 19,284 |
| Assumed preferred stock conversion | -- | 27,897 | -- | 27,897 |
| Non-GAAP basic and diluted shares | 71,940 | 47,510 | 68,115 | 47,181 |
| Non-GAAP basic and diluted net loss per share | $ (0.06) | $ (0.09) | $ (0.19) | $ (0.26) |
| Adjusted EBITDA: | ||||
| GAAP net loss | $ (10,827) | $ (6,575) | $ (40,608) | $ (17,962) |
| Stock-based expense (1) | 3,139 | 2,503 | 19,072 | 5,758 |
| Adjusted depreciation and amortization (2) | 2,462 | 569 | 5,899 | 1,552 |
| Acquisition-related and other expense | 2,021 | -- | 4,771 | -- |
| Income tax expense (benefit) | (2,293) | 181 | (1,731) | 468 |
| Total other (income) expense, net | (12) | 337 | 341 | 788 |
| Adjusted EBITDA | $ (5,510) | $ (2,985) | $ (12,256) | $ (9,396) |
| (1) Stock-based expense includes the following: | ||||
| Cost of revenue | $ 443 | $ 319 | $ 1,320 | $ 986 |
| Sales and marketing | 710 | 419 | 3,405 | 1,233 |
| Research and development | 674 | 356 | 2,370 | 920 |
| General and administrative | 1,312 | 1,409 | 11,977 | 2,619 |
| Stock-based expense | $ 3,139 | $ 2,503 | $ 19,072 | $ 5,758 |
| (2) Adjusted depreciation and amortization includes the following: | ||||
| Cost of revenue | $ 682 | $ 210 | $ 1,800 | $ 631 |
| Sales and marketing | 173 | 120 | 481 | 373 |
| Research and development | 169 | 134 | 474 | 295 |
| General and administrative | 273 | 105 | 601 | 253 |
| Amortization of acquired intangible assets | 1,165 | -- | 2,543 | -- |
| Adjusted depreciation and amortization | $ 2,462 | $ 569 | $ 5,899 | $ 1,552 |
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| Selected Quarterly Financial and Operational Metrics | ||||||||
| (unaudited) | ||||||||
| (in thousands, except active enterprise clients and full-time employees data) | ||||||||
| Three Months Ended | ||||||||
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| 2011 | 2011 | 2011 | 2012 | 2012 | 2012 | 2012 | 2013 | |
| Revenue (1) | $ 19,281 | $ 22,088 | $ 25,015 | $ 27,602 | $ 31,431 | $ 35,662 | $ 38,626 | $ 42,678 |
| Cost of revenue | 7,293 | 7,797 | 8,805 | 9,514 | 10,325 | 12,633 | 14,099 | 14,217 |
| Gross profit | 11,988 | 14,291 | 16,210 | 18,088 | 21,106 | 23,029 | 24,527 | 28,461 |
| Operating expenses: | ||||||||
| Sales and marketing | 10,116 | 11,192 | 12,125 | 12,152 | 14,257 | 15,322 | 17,850 | 20,710 |
| Research and development | 2,999 | 3,343 | 4,576 | 6,059 | 6,811 | 7,494 | 7,948 | 8,914 |
| General and administrative | 3,598 | 5,099 | 4,815 | 5,934 | 6,047 | 16,196 | 7,484 | 8,783 |
| Acquisition-related and other | -- | -- | -- | -- | -- | 1,384 | 1,366 | 2,021 |
| Amortization of acquired intangible assets | -- | -- | -- | -- | -- | 480 | 898 | 1,165 |
| Total operating expenses | 16,713 | 19,634 | 21,516 | 24,145 | 27,115 | 40,876 | 35,546 | 41,593 |
| Operating loss | (4,725) | (5,343) | (5,306) | (6,057) | (6,009) | (17,847) | (11,019) | (13,132) |
| Total other income (expense), net | 205 | (84) | (367) | (337) | (15) | (404) | 51 | 12 |
| Net loss before income taxes | (4,520) | (5,427) | (5,673) | (6,394) | (6,024) | (18,251) | (10,968) | (13,120) |
| Income tax expense (benefit) | 139 | 109 | 178 | 181 | 343 | 288 | 274 | (2,293) |
| Net loss | (4,659) | (5,536) | (5,851) | (6,575) | (6,367) | (18,539) | (11,242) | (10,827) |
| Stock-based expense (2) | 1,279 | 1,558 | 1,697 | 2,503 | 1,952 | 12,338 | 3,595 | 3,139 |
| Adjusted depreciation and amortization (3) | 449 | 471 | 512 | 569 | 552 | 1,338 | 2,099 | 2,462 |
| Acquisition-related and other expense | -- | -- | -- | -- | -- | 1,384 | 1,366 | 2,021 |
| Income tax expense (benefit) | 139 | 109 | 178 | 181 | 343 | 288 | 274 | (2,293) |
| Total other (income) expense, net | (205) | 84 | 367 | 337 | 15 | 404 | (51) | (12) |
| Adjusted EBITDA | $ (2,997) | $ (3,314) | $ (3,097) | $ (2,985) | $ (3,505) | $ (2,787) | $ (3,959) | $ (5,510) |
| Number of active enterprise clients (at period end) (4) | 571 | 640 | 701 | 737 | 790 | 1,076 | 1,109 | 1,179 |
| Full-time employees (at period end) | 494 | 520 | 566 | 608 | 640 | 771 | 777 | 796 |
| (1) Revenue includes the following: | ||||||||
| SaaS | $ 19,281 | $ 22,088 | $ 25,015 | $ 27,602 | $ 31,431 | $ 35,662 | $ 38,626 | $ 40,710 |
| Media | -- | -- | -- | -- | -- | -- | -- | 1,968 |
| Revenue | $ 19,281 | $ 22,088 | $ 25,015 | $ 27,602 | $ 31,431 | $ 35,662 | $ 38,626 | $ 42,678 |
| (2) Stock-based expense includes the following: | ||||||||
| Cost of revenue | $ 235 | $ 323 | $ 344 | $ 319 | $ 234 | $ 294 | $ 583 | $ 443 |
| Sales and marketing | 307 | 402 | 412 | 419 | 636 | 1,825 | 870 | 710 |
| Research and development | 176 | 204 | 360 | 356 | 406 | 642 | 1,054 | 674 |
| General and administrative | 561 | 629 | 581 | 1,409 | 676 | 9,577 | 1,088 | 1,312 |
| Stock-based expense | $ 1,279 | $ 1,558 | $ 1,697 | $ 2,503 | $ 1,952 | $ 12,338 | $ 3,595 | $ 3,139 |
| (3) Adjusted depreciation and amortization includes the following: | ||||||||
| Cost of revenue | $ 194 | $ 207 | $ 214 | $ 210 | $ 194 | $ 437 | $ 681 | $ 682 |
| Sales and marketing | 113 | 129 | 124 | 120 | 117 | 133 | 175 | 173 |
| Research and development | 50 | 68 | 93 | 134 | 136 | 144 | 161 | 169 |
| General and administrative | 92 | 67 | 81 | 105 | 105 | 144 | 184 | 273 |
| Amortization of acquired intangible assets | -- | -- | -- | -- | -- | 480 | 898 | 1,165 |
| Adjusted depreciation and amortization | $ 449 | $ 471 | $ 512 | $ 569 | $ 552 | $ 1,338 | $ 2,099 | $ 2,462 |
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(4) In connection with our acquisition of PowerReviews, which closed in |
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CONTACT: Bazaarvoice Investor Relations Contact:
Bazaarvoice Investor Relations
Seth Potter
ICR, Inc. on behalf of Bazaarvoice, Inc.
646-277-1230
seth.potter@icrinc.com
Media Contact:
Emily Brady
Brady PR on behalf of Bazaarvoice, Inc.
650-692-6107
emily@bradypr.com
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