ooma-8k_20160830.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 30, 2016

 

 

Ooma, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

 

 

 

 

 

Delaware

 

001-37493

 

06-1713274

(State or other jurisdiction

of incorporation or organization)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

1880 Embarcadero Road, Palo Alto, California 94303

(Address of principal executive offices)

(650) 566-6600

(Registrant’s telephone number, including area code)

 

 

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨

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))

 

 


 

Item 2.02. Results of Operations and Financial Condition

On August 30 2016, Ooma, Inc. (the “Company”), issued a press release announcing its financial results for the second quarter ended July 31, 2016. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information set forth in this Item 2.02 (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits

 

(d)Exhibits

The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

 

 

 

 

Exhibit No.

  

Description

 

 

99.1

  

Press release dated August 30, 2016, titled “Ooma Reports Second Quarter Fiscal 2017 Financial Results.”


 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

 

 

 

 

 

 

 

OOMA, INC.

 

 

 

 

Date: August 30, 2016

 

 

 

By:

 

/s/ Ravi Narula

 

 

 

 

 

 

Ravi Narula

 

 

 

 

 

 

Chief Financial Officer and Treasurer


 

EXHIBIT INDEX

 

 

 

 

Exhibit No.

  

Description

 

 

99.1

  

Press release dated August 30, 2016, titled “Ooma Reports Second Quarter Fiscal 2017 Financial Results.”

 

ooma-ex991_6.htm

Exhibit 99.1

Ooma Reports Second Quarter Fiscal 2017 Financial Results

- Record revenue of $25.5 million; up 21% year-over-year

- Subscription and services revenue of $22.4 million; up 28% year-over-year

Palo Alto, California –Tuesday August 30, 2016 - Ooma, Inc. (NYSE: OOMA), a leading smart communications platform for small businesses and consumers, today released financial results for the fiscal second quarter ended July 31, 2016.

Second Quarter Fiscal 2017 Financial Highlights:

 

Revenue: Total revenue of $25.5 million, up 21% year-over-year. Subscription and services revenue increased 28% year-over-year to $22.4 million, and was 88% of total revenue. Product and other revenue decreased 17% year-over-year to $3.1 million, and was 12% of total revenue.

 

Net Loss: GAAP net loss was $3.3 million, or $0.19 per basic and diluted share, compared to GAAP net loss of $3.4 million, or $0.80 per basic and diluted share, in the second quarter of fiscal 2016. Non-GAAP net loss was $0.9 million, or $0.05 per basic and diluted share, compared to non-GAAP net loss of $2.5 million, or $0.58 per basic and diluted share, in the second quarter of fiscal 2016.

For more information about non-GAAP net loss, see the section below titled “Non-GAAP Financial Measures” and the reconciliation from GAAP net loss in this release.

“I’m very pleased to report that Q2 was another strong quarter for Ooma,” said Eric Stang, chief executive officer of Ooma. “We are executing well on our key initiatives, and are particularly pleased by the growth of Ooma Office which was up more than 60% over the prior year quarter. We are actively investing to expand the power of the Ooma platform and introduce new products and services to capitalize on a very large market opportunity. Given the sizeable market opportunity our commitment to innovation, we believe we can continue to achieve significant revenue growth while also improving our bottom line.”

Recent Business Highlights:  

 

Launched Ooma Office for Mobile, a cloud-based phone service that allows small business owners to run their business solely from their mobile phones.

 

Announced Ooma Office Partner Program to enable resellers to market and sell our award winning Ooma Office platform.

 

Upgraded the capabilities of our Blacklist feature to provide the most aggressive defense against unwanted callers.

 

Increased capacity of Personal Blacklist feature, combined with Community Blacklist and Expanded Blacklist, providing the most aggressive defense against unwanted callers.

 

Introduced New World Plus Plan to expand international calling options.

 

Announced Talkatone now provides consumers the ability to block unwanted calls and texts.

 

Appointed Susan Butenhoff to the board of directors. Butenhoff has 30 years of public relations experience assisting major multinational companies in communications and brand strategy.

Business Outlook:

For the third quarter fiscal 2017, Ooma expects to report:

 

Total revenue between $26.5 million to $27.5 million.

 

GAAP net loss is expected to be in the range of $3.2 million to $3.7 million, and non-GAAP net loss is expected to be in the range of $0.7 million to $1.0 million.

 

GAAP net loss per share is expected to be in the range of $0.18 to $0.21, and non-GAAP net loss per share in the range of $0.04 to $0.06 based on approximately 17.7 million basic and diluted weighted average common shares outstanding.

For the full fiscal year 2017, Ooma expects to report:

 

Total revenue in the range of $104.0 million to $107.0 million.

 

GAAP net loss is expected to be in the range of $13.6 million to $14.9 million, and non-GAAP net loss in the range of $3.5 million to $4.5 million.

 

GAAP net loss per share is expected to be in the range of $0.77 to $0.84, and non-GAAP net loss per share in the range of $0.20 to $0.25, based on approximately 17.6 million basic and diluted weighted average common shares outstanding.

1

 


The following is a reconciliation of GAAP net loss to non-GAAP net loss and GAAP basic and diluted earnings per share to non-GAAP basic and diluted earnings per share guidance for the fiscal third quarter ending October 31, 2016 and for the fiscal year ending January 31, 2017:

Reconciliation of GAAP Net Loss and GAAP Basic and Diluted Net Loss per Share Guidance to

Non-GAAP Net Loss and Non-GAAP Basic and Diluted Net Loss per Share Guidance

(In millions, except per share data)

 

 

 

Projected range

 

 

 

Three Months Ending

 

 

Fiscal Year Ending

 

 

 

October 31, 2016

 

 

January 31, 2017

 

 

 

(unaudited)

 

GAAP Net Loss

 

($3.2)-($3.7)

 

 

($13.6)-($14.9)

 

Stock-based compensation expense and related taxes

 

2.4-2.6

 

 

9.7-10.0

 

Amortization of intangibles

 

 

0.1

 

 

 

0.4

 

Non-GAAP Net Loss

 

($0.7)-($1.0)

 

 

($3.5)-($4.5)

 

 

 

 

 

 

 

 

 

 

Basic and Diluted Net Loss per Share on a GAAP basis

 

($0.18)-($0.21)

 

 

($0.77)-($0.84)

 

Stock-based compensation expense and related taxes

 

0.13-0.14

 

 

0.55-0.57

 

Amortization of intangibles

 

 

0.01

 

 

0.02

 

Basic and Diluted Net Loss per Share on a Non-GAAP basis

 

($0.04)-($0.06)

 

 

($0.20)-($0.25)

 

Weighted-average number of shares used in per share amounts:

 

 

 

 

 

 

 

 

Basic and diluted

 

 

17.70

 

 

 

17.60

 

 

 

2

 


Conference Call Information:

Ooma will host a conference call and live webcast for analysts and investors at 5:00 p.m. Eastern time today, August 30, 2016. The news release with the financial results will be accessible from the company’s website prior to the conference call. Parties in the United States and Canada can access the call by dialing +1 (888)-312-3048, using conference code 2299406. International parties can access the call by dialing +1 (719)-325-2244, using conference code 2299406.

The webcast will be accessible on Ooma’s investor relations website at http://investors.ooma.com for a period of one year. A telephonic replay of the conference call will be available through Tuesday, September 6, 2016. To access the replay, parties in the United States and Canada should call +1 (888)-203-1112 and enter conference code 2299406. International parties should call + 1 (719)-457-0820 and enter conference code 2299406.

3

 


Non-GAAP Financial Measures

In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures, including: non-GAAP net loss, non-GAAP net loss per share, non-GAAP gross profit and gross margin, non-GAAP operating loss, and Adjusted EBITDA. Adjusted EBITDA represents the net loss before interest and other income, depreciation and amortization and other non-GAAP expenses.

These non-GAAP financial measures exclude non-cash stock-based compensation expense, amortization of intangibles, the change in fair value of our acquisition-related contingent consideration, change in fair value of warrants and write-off of non-cash deferred debt issuance costs.

These non-GAAP financial measures are presented to enhance investors’ understanding of the results of Ooma’s core business operations. Ooma considers these non-GAAP financial measures to be useful measures of the operating performance of the company, because they contain adjustments for unusual events or factors that do not directly affect what management considers to be Ooma’s core operating performance, and are used by the company’s management for that purpose. Management also believes that these non-GAAP financial measures allow for a better evaluation of the company’s performance by facilitating a meaningful comparison of the company’s core operating results in a given period to those in prior and future periods. In addition, investors often use similar measures to evaluate the operating performance of a company.

Non-GAAP financial measures are presented for supplemental informational purposes only to aid an understanding of the company’s operating results. The non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP financial measures presented by other companies. A limitation of the non-GAAP financial measures presented is that the adjustments relate to items that the company generally expects to continue to recognize. The adjustment of these items should not be construed as an inference that the adjusted gains or expenses are unusual, infrequent or non-recurring. Therefore, both GAAP financial measures of Ooma’s financial performance and the respective non-GAAP measures should be considered together. Please see the reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure in the tables below.

Disclosure Information

Ooma uses the investor relations section on its website as means of complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor Ooma’s investor relations website in addition to following Ooma’s press releases, SEC filings, and public conference calls and webcasts.

Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995. In particular, statements regarding future economic performance, finances, and expectations and objectives of management constitute forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical facts and generally contain words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” “anticipates,” and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters. In particular, this press release includes forward looking statements regarding continued growth of our subscriber base, the strength and quality of our SaaS platform, our competitive advantage serving small business, home and mobile customers, and improvement in our financial performance. Although the forward-looking statements contained in this press release are based upon information available at the time the statements are made and reflect management’s good faith beliefs, forward-looking statements inherently involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements to differ materially from anticipated future results. Important factors that could cause actual results to differ materially from expectations include, among others: our inability to attract new customers on a cost-effective basis; our inability to retain customers; intense competition; our reliance on retailers and reseller partnerships to sell our products; our reliance on vendors to manufacture the on-premise appliances and end-point devices we sell; our reliance on third parties for our network connectivity and co-location facilities; our reliance on third parties for some of our software development, quality assurance and operations; our reliance on third parties to provide the majority of our customer service and support representatives; our limited operating history; and interruptions to our service. You should not place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, except as required by applicable law.

The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including the risk factors contained in our Annual Report Form 10-K for the year ended January 31, 2016, filed with the SEC on April 13, 2016. The forward-looking statements in this press release are based on information available to Ooma as of the date hereof, and Ooma disclaims any obligation to update any forward-looking statements, except as required by law.

4

 


About Ooma

Founded in 2004, Ooma creates new communications experiences for small businesses and consumers. Its smart platform serves as a communications hub, which offers cloud-based telephony and other connected services. Ooma combines PureVoice™ HD call quality and innovative features with mobile applications for reliable anytime, anywhere calling. The Company has been ranked the No. 1 home phone service for overall satisfaction and value for five consecutive years by the leading consumer research publication. Ooma is also partnering with connected device makers to create smarter offices and homes. Ooma is available in stores and online from leading retailers. For more information about Ooma, please visit www.ooma.com or follow us on TwitterLinkedIn or Facebook.

Ooma, PureVoice and the Ooma logo are trademarks of Ooma, Inc. All other company and product names may be trademarks of the respective companies with which they are associated.

CONTACT:

Investor Relations:

Cynthia Hiponia or Erin Rheaume

The Blueshirt Group for Ooma, Inc.

ir@ooma.com

(650) 300-1480

Public Relations:

Brian Jaquet

Ooma, Inc.

Brian.Jaquet@ooma.com

(650) 300-2125

5

 


 

OOMA, INC

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

 

 

 

July 31,

 

 

January 31,

 

 

2016

 

 

2016

 

 

(unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

$

6,712

 

 

$

27,413

 

Short-term investments

 

47,126

 

 

 

27,991

 

Accounts receivable, net

 

4,478

 

 

 

5,609

 

Inventories

 

4,564

 

 

 

5,011

 

Deferred inventory costs

 

2,037

 

 

 

2,013

 

Prepaid expenses and other current assets

 

1,637

 

 

 

1,318

 

Total current assets

 

66,554

 

 

 

69,355

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

4,478

 

 

 

4,291

 

Intangible assets, net

 

703

 

 

 

885

 

Goodwill

 

1,117

 

 

 

1,117

 

Other assets

 

307

 

 

 

888

 

Total assets

$

73,159

 

 

$

76,536

 

 

 

 

 

 

 

 

 

Liabilities and stockholders' equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

$

5,493

 

 

$

4,786

 

Accrued expenses

 

10,805

 

 

 

13,010

 

Short-term capital lease

 

 

 

 

632

 

Deferred revenue

 

15,134

 

 

 

15,036

 

Total current liabilities

 

31,432

 

 

 

33,464

 

 

 

 

 

 

 

 

 

Other liabilities

 

225

 

 

 

182

 

Total liabilities

$

31,657

 

 

 

33,646

 

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

Common stock

 

2

 

 

 

2

 

Additional paid-in capital

 

113,562

 

 

 

107,679

 

Accumulated comprehensive income

 

42

 

 

 

17

 

Accumulated deficit

 

(72,104

)

 

 

(64,808

)

Total stockholders' equity

 

41,502

 

 

 

42,890

 

Total liabilities and stockholders' equity

$

73,159

 

 

$

76,536

 

 

6

 


 

OOMA, INC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per share data)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

 

 

(unaudited)

 

 

(unaudited)

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subscription and services

 

$

22,417

 

 

$

17,449

 

 

$

43,907

 

 

$

33,025

 

Product and other

 

 

3,077

 

 

 

3,687

 

 

 

6,046

 

 

 

7,963

 

Total revenue

 

 

25,494

 

 

 

21,136

 

 

 

49,953

 

 

 

40,988

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subscription and services

 

 

7,444

 

 

 

6,310

 

 

 

14,715

 

 

 

11,934

 

Product and other

 

 

3,501

 

 

 

3,583

 

 

 

7,040

 

 

 

7,790

 

Total cost of revenue

 

 

10,945

 

 

 

9,893

 

 

 

21,755

 

 

 

19,724

 

Gross profit

 

 

14,549

 

 

 

11,243

 

 

 

28,198

 

 

 

21,264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

 

8,578

 

 

 

6,813

 

 

 

16,673

 

 

 

12,708

 

Research and development

 

 

5,839

 

 

 

4,284

 

 

 

11,580

 

 

 

8,381

 

General and administrative

 

 

3,545

 

 

 

3,206

 

 

 

7,400

 

 

 

6,167

 

Total operating expenses

 

 

17,962

 

 

 

14,303

 

 

 

35,653

 

 

 

27,256

 

Loss from operations:

 

 

(3,413

)

 

 

(3,060

)

 

 

(7,455

)

 

 

(5,992

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income (expense), net

 

 

100

 

 

 

(607

)

 

 

164

 

 

 

(892

)

Change in fair value of warrants

 

 

 

 

 

274

 

 

 

 

 

 

(442

)

Other (expense) income, net

 

 

(27

)

 

 

(10

)

 

 

(5

)

 

 

(12

)

Net loss

 

$

(3,340

)

 

$

(3,403

)

 

$

(7,296

)

 

$

(7,338

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share of common stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.19

)

 

$

(0.80

)

 

$

(0.42

)

 

$

(2.14

)

Weighted-average number of shares used in per share amounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

 

17,280,985

 

 

 

4,233,193

 

 

 

17,180,671

 

 

 

3,422,521

 

 

7

 


OOMA, INC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(3,340

)

 

$

(3,403

)

 

$

(7,296

)

 

$

(7,338

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

2,399

 

 

 

738

 

 

 

4,873

 

 

 

1,289

 

Depreciation and amortization

 

 

433

 

 

 

354

 

 

 

822

 

 

 

670

 

Amortization of intangibles

 

 

85

 

 

 

98

 

 

 

182

 

 

 

197

 

Write-off of non-cash deferred debt issuance costs

 

 

 

 

 

332

 

 

 

 

 

 

332

 

Other non-cash (income) expense, net

 

 

(3

)

 

 

20

 

 

 

(3

)

 

 

64

 

Change in fair value of acquisition-related contingent consideration

 

 

 

 

 

43

 

 

 

 

 

 

124

 

Change in fair value of warrant liability

 

 

 

 

 

(274

)

 

 

 

 

 

442

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable, net

 

 

544

 

 

 

(2,456

)

 

 

1,131

 

 

 

(529

)

Inventories

 

 

(656

)

 

 

1,055

 

 

 

447

 

 

 

860

 

Deferred inventory costs

 

 

(196

)

 

 

(753

)

 

 

(24

)

 

 

558

 

Prepaid expenses and other assets

 

 

327

 

 

 

(221

)

 

 

217

 

 

 

(178

)

Accounts payable and accrued expenses

 

 

286

 

 

 

1,188

 

 

 

(1,087

)

 

 

3,293

 

Other liabilities

 

 

(2

)

 

 

(454

)

 

 

(22

)

 

 

(62

)

Deferred revenue

 

 

784

 

 

 

1,712

 

 

 

176

 

 

 

(372

)

Net cash provided by (used in) operating activities

 

 

661

 

 

 

(2,021

)

 

 

(584

)

 

 

(650

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of short-term investments

 

 

(13,855

)

 

 

 

 

 

(33,115

)

 

 

 

Proceeds from maturity of short-term investments

 

 

8,450

 

 

 

 

 

 

10,950

 

 

 

 

Proceeds from sale of short-term investments

 

 

3,016

 

 

 

 

 

 

3,016

 

 

 

 

Purchases of property and equipment

 

 

(709

)

 

 

(458

)

 

 

(1,030

)

 

 

(866

)

Net cash used in investing activities

 

 

(3,098

)

 

 

(458

)

 

 

(20,179

)

 

 

(866

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from initial public offering, net

 

 

 

 

 

59,301

 

 

 

 

 

 

58,848

 

Proceeds from Series Beta preferred stock, net

 

 

 

 

 

 

 

 

 

 

 

5,000

 

Repayment of debt and capital leases

 

 

 

 

 

(10,760

)

 

 

(628

)

 

 

(11,294

)

Payment of acquisition related earn-out

 

 

 

 

 

 

 

 

(100

)

 

 

(475

)

Payment of preferred warrant liability

 

 

 

 

 

(584

)

 

 

 

 

 

(584

)

Proceeds from issuance of common stock related to warrants and employee stock benefit plans

 

 

167

 

 

 

60

 

 

 

790

 

 

 

61

 

Net cash provided by financing activities

 

 

167

 

 

 

48,017

 

 

 

62

 

 

 

51,556

 

Net (decrease) increase in cash and cash equivalents

 

 

(2,270

)

 

 

45,538

 

 

 

(20,701

)

 

 

50,040

 

Cash and cash equivalents at beginning of period

 

 

8,982

 

 

 

13,635

 

 

 

27,413

 

 

 

9,133

 

Cash and cash equivalents at end of period

 

$

6,712

 

 

$

59,173

 

 

$

6,712

 

 

$

59,173

 

8

 


OOMA, INC

Reconciliation of Non-GAAP Financial Measures

Impact of Non-GAAP Adjustments on Reported Net Loss

(Amounts in thousands, except percentages and per share data)

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

July 31,

 

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

 

 

(unaudited)

 

 

(unaudited)

 

Revenue

 

$

25,494

 

 

$

21,136

 

 

$

49,953

 

 

$

40,988

 

Reconciliation of GAAP Gross Profit and GAAP Gross Margin

to Non-GAAP Gross Profit and Non-GAAP Gross Margin:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Gross Profit

 

$

14,549

 

 

$

11,243

 

 

$

28,198

 

 

$

21,264

 

Stock-based compensation expense

 

 

243

 

 

 

65

 

 

 

478

 

 

 

123

 

Amortization of intangibles

 

 

42

 

 

 

41

 

 

 

82

 

 

 

82

 

Non-GAAP Gross Profit

 

$

14,834

 

 

$

11,349

 

 

$

28,758

 

 

$

21,469

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin on a GAAP basis

 

 

57

%

 

 

53

%

 

 

56

%

 

 

52

%

Gross Margin on a Non-GAAP basis

 

 

58

%

 

 

54

%

 

 

58

%

 

 

52

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Operating Loss on a GAAP Basis

to Operating Loss on a Non-GAAP Basis:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Operating Loss

 

$

(3,413

)

 

$

(3,060

)

 

$

(7,455

)

 

$

(5,992

)

Stock-based compensation expense

 

 

2,399

 

 

 

738

 

 

 

4,873

 

 

 

1,289

 

Amortization of intangibles

 

 

85

 

 

 

98

 

 

 

182

 

 

 

197

 

Change in fair value of acquisition-related contingent consideration

 

 

 

 

 

43

 

 

 

 

 

 

124

 

Non-GAAP Operating Loss

 

$

(929

)

 

$

(2,181

)

 

$

(2,400

)

 

$

(4,382

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of GAAP Net Loss to Non-GAAP Net Loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Net Loss

 

$

(3,340

)

 

$

(3,403

)

 

$

(7,296

)

 

$

(7,338

)

Stock-based compensation expense

 

 

2,399

 

 

 

738

 

 

 

4,873

 

 

 

1,289

 

Amortization of intangibles

 

 

85

 

 

 

98

 

 

 

182

 

 

 

197

 

Change in fair value of acquisition-related contingent consideration

 

 

 

 

 

43

 

 

 

 

 

 

124

 

Change in fair value of warrants

 

 

 

 

 

(274

)

 

 

 

 

 

442

 

Write-off of non-cash deferred debt issuance costs

 

 

 

 

 

332

 

 

 

 

 

 

332

 

Non-GAAP Net Loss

 

$

(856

)

 

$

(2,466

)

 

$

(2,241

)

 

$

(4,954

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Basic and Diluted Net Loss per Share on a GAAP Basis to Basic and Diluted Net Loss per Share on a Non-GAAP Basis:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and Diluted Net Loss per share on a GAAP Basis

 

$

(0.19

)

 

$

(0.80

)

 

$

(0.42

)

 

$

(2.14

)

Stock-based compensation expense

 

 

0.14

 

 

 

0.17

 

 

 

0.28

 

 

 

0.37

 

Amortization of intangibles

 

 

 

 

 

0.02

 

 

 

0.01

 

 

 

0.05

 

Change in fair value of acquisition-related contingent consideration

 

 

 

 

 

0.01

 

 

 

 

 

 

0.04

 

Change in fair value of warrants

 

 

 

 

 

(0.06

)

 

 

 

 

 

0.13

 

Write-off of non-cash deferred debt issuance costs

 

 

 

 

 

0.08

 

 

 

 

 

 

0.10

 

Basic and Diluted Net Loss per share on a Non-GAAP Basis

 

$

(0.05

)

 

$

(0.58

)

 

$

(0.13

)

 

$

(1.45

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Loss to Adjusted EBITDA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$

(3,340

)

 

$

(3,403

)

 

$

(7,296

)

 

$

(7,338

)

Reconciling items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other (income) expense, net

 

 

(73

)

 

 

285

 

 

 

(159

)

 

 

572

 

Depreciation and amortization

 

 

387

 

 

 

354

 

 

 

734

 

 

 

670

 

Amortization of intangibles

 

 

85

 

 

 

98

 

 

 

182

 

 

 

197

 

Stock-based compensation expense

 

 

2,399

 

 

 

738

 

 

 

4,873

 

 

 

1,289

 

Change in fair value of acquisition-related contingent consideration

 

 

 

 

 

43

 

 

 

 

 

 

124

 

Change in fair value of warrants

 

 

 

 

 

(274

)

 

 

 

 

 

442

 

Write-off of non-cash deferred debt issuance costs

 

 

 

 

 

332

 

 

 

 

 

 

332

 

Adjusted EBITDA

 

$

(542

)

 

$

(1,827

)

 

$

(1,666

)

 

$

(3,712

)

 

 

9