Ribbon Communications Inc. Releases First Quarter 2018 Financial Results
"We are pleased with our first quarter results continuing the momentum we established at the end of last year. We've quickly established Ribbon as an innovative technology provider meeting the customers' demand for secure, real-time communications," said
First Quarter 2018 Financial Highlights1,2
- GAAP total revenue was
$121.2 million , compared to$53.4 million in the first quarter of 2017. - Non-GAAP total revenue was
$135.3 million , compared to$53.4 million in the first quarter of 2017. - GAAP net loss was
$44.9 million , compared to$10.6 million in the first quarter of 2017. - Non-GAAP net loss was
$4.0 million , compared to$4.5 million in the first quarter of 2017. - GAAP loss per share was
$0.44 , compared to$0.22 in the first quarter of 2017. - Non-GAAP loss per share was
$0.04 , compared to$0.09 in the first quarter of 2017. - Non-GAAP Adjusted EBITDA was
$1.0 million , compared to negative$2.8 million in the first quarter of 2017. - Cash and investments were
$84.5 million at the end of the first quarter of 2018, compared to$83.3 million at the end of the fourth quarter of 2017.
First Quarter 2018 Customer and Company Highlights
- Ribbon announced a virtualized Session Border Controller as a Service (SBCaaS) solution with Verizon. The Verizon SBCaaS, powered by Ribbon, enables enterprises to dynamically respond to seasonal demands in a truly elastic operating expense model, helping them better manage their costs, adjust to changing business needs, and reduce their reliance on dedicated network hardware and potential points of network failure.
- The Company successfully completed a multi-site trial of its cloud unified communications offer in conjunction with one of its global channel partners for a large retail company in the US. Ribbon expects the agreement to be completed early in the second quarter of 2018. The company selected Ribbon because of its extensive experience in providing reliable cloud-based, multi-site business communications services.
- Ribbon completed the delivery of core products (softswitches and media gateways) for a tier one service provider in
Asia that plans to significantly expand network capacity to accommodate its growing mobile subscriber base. - Ribbon signed its first tier one service provider customer in the
Asia/Pacific region for Ribbon Protect, the company's recently launched security product that provides advanced network analytics. Ribbon Protect provides visibility into networks and a large data behavioral analytics platform for real time communications networks and applications. The Company expects to recognize revenue from this customer in the second half of 2018. - Microsoft selected the Ribbon Session Border Controller (SBC) portfolio to deliver secure, integrated voice services to Office 365's newest offering, Microsoft Direct Routing for Teams. As the migration to Teams ramps up late in the year and into next year, Ribbon expects a positive impact in its SBC portfolio.
- Leading market research firm IHS Markit ranked key solutions from Ribbon's core network modernization product set as market leaders in their respective categories. Ribbon's session border controller, media gateways and softswitch solutions all ranked either first or second in global market share according to IHS Markit.
1 The Sonus-GENBAND merger occurred on
2 Please see the reconciliation of non-GAAP and GAAP financial measures, and additional information about non-GAAP measures, in the press release appendix.
Conference Call Details
Ribbon will offer a live, listen-only webcast of the conference call to discuss the complete financial results for the first quarter ended
Conference call details:
Date:
Time:
Dial-in number: 800-705-8289 - International callers: +1-303-223-2689
Replay information:
A telephone playback of the call will be available following the conference call until
About
Important Information Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the
Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, our success integrating the respective businesses of Sonus Networks, Inc. ("Sonus") and
Our forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We caution you against relying on any of these forward-looking statements. Important factors that could cause actual results to differ materially from these forward-looking statements are discussed in Part I, Item IA "Risk Factors", Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Part II, Item 7A "Quantitative and Qualitative Disclosures About Market Risk" in
Discussion of Non-GAAP Financial Measures
Ribbon management uses several different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of the business, making operating decisions, planning and forecasting future periods, and determining payments under compensation programs. Our annual financial plan is prepared both on a GAAP and non-GAAP basis, and the non-GAAP annual financial plan is approved by our board of directors. Continuous budgeting and forecasting for revenue and expenses are conducted on a non-GAAP basis (in addition to GAAP) and actual results on a non-GAAP basis are assessed against the annual financial plan. We consider the use of non-GAAP financial measures helpful in assessing the core performance of our continuing operations and when planning and forecasting future periods. By continuing operations, we mean the ongoing results of the business adjusted for acquisition-related revenue as a result of purchase accounting and the related cost of revenue, the impact of the new revenue standard, and excluding certain expenses and credits, including, but not limited to stock-based compensation, amortization of intangible assets, settlement expense, certain litigation costs, acquisition-related facilities adjustments; acquisition- and integration-related expense and restructuring. While our management uses non-GAAP financial measures as a tool to enhance their understanding of certain aspects of our financial performance, our management does not consider these measures to be a substitute for, or superior to, GAAP measures. In addition, our presentations of these measures may not be comparable to similarly titled measures used by other companies. These non-GAAP financial measures should not be considered alternatives for, or in isolation from, the financial information prepared and presented in accordance with GAAP.
Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. In particular, many of the adjustments to Ribbon's financial measures reflect the exclusion of items that are recurring and will be reflected in our financial results for the foreseeable future.
Acquisition-Related Revenue and Cost of Revenue; Impact of New Revenue Standard
We provide the supplementary non-GAAP financial measures, non-GAAP Product revenue, non-GAAP Service revenue and non-GAAP Total revenue, which include revenue related to the acquisition of GENBAND that we would have recognized but for the purchase accounting treatment of these transactions and eliminated revenue as a result of our adoption in 2018 of the new revenue recognition standard. Because GAAP accounting requires the elimination of this revenue, as well as the impact on future revenue of our adoption in 2018 of the new revenue standard, GAAP results alone do not fully capture all of our economic activities. These non-GAAP adjustments are intended to reflect the full amounts of such revenue and the related cost of revenue. We include these adjustments to allow for more complete
comparisons to the financial results of our historical operations, forward-looking guidance and the financial results of peer companies. We believe these adjustments are useful to management and investors as a measure of the ongoing performance of the business. These adjustments do not accelerate revenue, but instead include revenue (and the related cost of revenue) that would have been recognized in our 2017 results, and included in our 2018 guidance and results, but for the purchase accounting and new revenue standard adjustments required by GAAP.
Stock-Based Compensation
Stock-based compensation expense is different from other forms of compensation, as it is a non-cash expense. For example, a cash salary generally has a fixed and unvarying cash cost. In contrast, the expense associated with an equity-based award is generally unrelated to the amount of cash ultimately received by the employee, and the cost to us is based on a stock-based compensation valuation methodology, subjective assumptions and the variety of award types, all of which may vary over time. We evaluate performance without these measures because stock-based compensation expense is influenced by the Company's stock price and other factors such as volatility and interest rates that are beyond our control. The expense related to stock-based awards is generally not controllable in the short-term and can vary significantly based on the timing, size
and nature of awards granted. As such, we do not include such charges in our operating plans, and we believe that presenting non-GAAP operating results that exclude stock-based compensation provides investors with visibility and insight into our management's method of analysis and the Company's core operating performance. It is reasonable to expect that stock-based compensation will continue in future periods.
Amortization of Intangible Assets
We exclude the amortization of acquired intangible assets from non-GAAP expense and income measures. These amortization amounts are inconsistent in frequency and amount and are significantly impacted by the timing and size of acquisitions. Although we exclude amortization of acquired intangible assets from our non-GAAP expenses, we believe that it is important for investors to understand that intangible assets contribute to revenue generation. We believe that excluding the non-cash amortization of intangible assets facilitates the comparison of our financial results to our historical operating results and to other companies in our industry as if the acquired intangible assets had been developed internally rather than acquired. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such
intangible assets have been fully amortized.
Settlement Expense
In
Litigation Costs
In connection with certain ongoing litigation between GENBAND, as plaintiff, and one of its competitors, we incurred litigation costs in the fourth quarter of 2017. In
Acquisition-Related Facilities Adjustments
GAAP accounting requires that the deferred rent liability of an acquired company be written off as part of purchase accounting and that the combined company's rent expense on a straight-line basis begin as of the acquisition date. As a result, we recorded more rent expense than would have been recognized but for the purchase accounting treatment of GENBAND's assumed deferred rent liability. We include this adjustment, which relates to the acquisition of GENBAND, to allow for more complete comparisons to the financial results of our historical operations, forward-looking guidance and the financial results of peer companies. We believe these adjustments provide an indication of the rent expense that would have been recognized, but for the purchase accounting in connection with the acquisition of GENBAND.
Acquisition- and Integration-Related Expense
We consider certain acquisition- and integration-related costs to be unrelated to the organic continuing operations of our acquired businesses and the Company and they are generally not relevant to assessing or estimating the long-term performance of the acquired assets. In addition, the size, complexity and/or volume of an acquisition, which often drives the magnitude of acquisition- and integration-related costs, may not be indicative of future acquisition- and integration-related costs. By excluding these acquisition- and integration-related costs from our non-GAAP measures, management is better able to evaluate our ability to utilize our existing assets and estimate the long-term value that acquired assets will generate for us. We exclude certain acquisition- and integration-related costs to allow more accurate
comparisons of our financial results to our historical operations, forward-looking guidance and the financial results of less acquisitive peer companies. In addition, we believe that providing supplemental non-GAAP measures that exclude these items allows management and investors to consider the ongoing operations of the business both with and without such expenses.
Restructuring
We have recorded restructuring expense to streamline operations and reduce operating costs by closing and consolidating certain facilities and reducing our worldwide workforce. We review our restructuring accruals regularly and record adjustments (both expense and credits) to these estimates as required. We believe that excluding restructuring expense and credits facilitates the comparison of our financial results to our historical operating results and to other companies in our industry, as there are no future revenue streams or other benefits associated with these costs.
Adjusted EBITDA
We use Adjusted EBITDA as a supplemental measure to review and assess our performance. We calculate Adjusted EBITDA by excluding from net income (loss): interest income (expense), net; income tax benefit (provision); depreciation; and amortization of intangible assets. In addition, we exclude from net income (loss): adjustments to revenue and cost of revenue related to revenue reductions resulting from purchase accounting and adoption of the new revenue standard; stock-based compensation expense; settlement expense; certain litigation costs; acquisition-related facilities adjustments; acquisition- and integration-related expense; restructuring; and other income, net. In general, we add back the expenses that we consider to be non-cash and/or not part of our ongoing operations. Adjusted EBITDA is a non-GAAP financial measure that is used by our
investing community for comparative and valuation purposes. We disclose this metric to support and facilitate our dialogue with research analysts and investors. Other companies may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.
We believe that providing non-GAAP information to investors, in addition to the GAAP presentation, will allow investors to view the financial results in the way management views them. We further believe that providing this information helps investors to better understand our core financial and operating performance and evaluate the efficacy of the methodology and information used by our management to evaluate and measure such performance.
Investor Relations:
+1 (978) 614-8841
sleggat@rbbn.com
+1 (214) 695 2224
dwatson@rbbn.com
+1.646.741.1974
cberthier@rbbn.com
| ||||||
Consolidated Statements of Operations | ||||||
(in thousands, except percentages and per share amounts) | ||||||
(unaudited) | ||||||
Three months ended | ||||||
|
| |||||
2018 |
2017 | |||||
Revenue: |
||||||
Product |
$ 51,531 |
$ 25,395 | ||||
Service |
69,649 |
27,973 | ||||
Total revenue |
121,180 |
53,368 | ||||
Cost of revenue: |
||||||
Product |
33,014 |
9,753 | ||||
Service |
32,893 |
9,867 | ||||
Total cost of revenue |
65,907 |
19,620 | ||||
Gross profit |
55,273 |
33,748 | ||||
Gross margin: |
||||||
Product |
35.9% |
61.6% | ||||
Service |
52.8% |
64.7% | ||||
Total gross margin |
45.6% |
63.2% | ||||
Operating expenses: |
||||||
Research and development |
39,049 |
20,209 | ||||
Sales and marketing |
31,926 |
14,676 | ||||
General and administrative |
15,601 |
9,019 | ||||
Acquisition- and integration-related |
4,412 |
56 | ||||
Restructuring |
6,668 |
570 | ||||
Total operating expenses |
97,656 |
44,530 | ||||
Loss from operations |
(42,383) |
(10,782) | ||||
Interest income (expense), net |
(599) |
258 | ||||
Other income, net |
248 |
1 | ||||
Loss before income taxes |
(42,734) |
(10,523) | ||||
Income tax provision |
(2,170) |
(123) | ||||
Net loss |
$ (44,904) |
$ (10,646) | ||||
Loss per share: |
||||||
Basic |
$ (0.44) |
$ (0.22) | ||||
Diluted |
$ (0.44) |
$ (0.22) | ||||
Shares used to compute loss per share: |
||||||
Basic |
101,917 |
49,114 | ||||
Diluted |
101,917 |
49,114 |
| ||||||
Consolidated Balance Sheets | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
|
| |||||
2018 |
2017 | |||||
Assets |
||||||
Current assets: |
||||||
Cash and cash equivalents |
$ 58,589 |
$ 57,073 | ||||
Marketable securities |
23,724 |
17,224 | ||||
Accounts receivable, net |
125,504 |
165,156 | ||||
Inventory |
21,422 |
21,303 | ||||
Other current assets |
22,192 |
21,463 | ||||
Total current assets |
251,431 |
282,219 | ||||
Property and equipment, net |
24,002 |
24,780 | ||||
Intangible assets, net |
232,105 |
244,414 | ||||
|
335,716 |
335,716 | ||||
Investments |
2,225 |
9,031 | ||||
Deferred income taxes |
8,154 |
8,434 | ||||
Other assets |
7,445 |
6,289 | ||||
$ 861,078 |
$ 910,883 | |||||
Liabilities and Stockholders' Equity |
||||||
Current liabilities: |
||||||
Revolving credit facility |
$ 20,000 |
$ 20,000 | ||||
Accounts payable |
37,119 |
45,851 | ||||
Accrued expenses and other |
62,749 |
76,380 | ||||
Deferred revenue |
103,162 |
100,571 | ||||
Total current liabilities |
223,030 |
242,802 | ||||
Long-term debt, related party |
22,500 |
22,500 | ||||
Deferred revenue, net of current |
14,218 |
14,184 | ||||
Deferred income taxes |
3,092 |
2,787 | ||||
Other long-term liabilities |
13,203 |
13,189 | ||||
Total liabilities |
276,043 |
295,462 | ||||
Commitments and contingencies |
||||||
Stockholders' equity: |
||||||
Common stock |
10 |
10 | ||||
Additional paid-in capital |
1,687,231 |
1,684,768 | ||||
Accumulated deficit |
(1,105,366) |
(1,072,426) | ||||
Accumulated other comprehensive income |
3,160 |
3,069 | ||||
Total stockholders' equity |
585,035 |
615,421 | ||||
$ 861,078 |
$ 910,883 |
| |||||||
Consolidated Statements of Cash Flows | |||||||
(in thousands) | |||||||
(unaudited) | |||||||
Three months ended | |||||||
March 31, |
March 31, | ||||||
2018 |
2017 | ||||||
Cash flows from operating activities: |
|||||||
Net loss |
$ (44,904) |
$ (10,646) | |||||
Adjustments to reconcile net loss to cash flows provided by operating activities: |
|||||||
Depreciation and amortization of property and equipment |
2,507 |
1,823 | |||||
Amortization of intangible assets |
12,309 |
2,259 | |||||
Stock-based compensation |
2,824 |
3,263 | |||||
Deferred income taxes |
528 |
238 | |||||
Changes in operating assets and liabilities: |
|||||||
Accounts receivable |
39,763 |
14,324 | |||||
Inventory |
(412) |
315 | |||||
Other operating assets |
(2,182) |
(405) | |||||
Accounts payable |
(8,976) |
(651) | |||||
Accrued expenses and other long-term liabilities |
(12,820) |
(10,530) | |||||
Deferred revenue |
14,755 |
3,614 | |||||
Net cash provided by operating activities |
3,392 |
3,604 | |||||
Cash flows from investing activities: |
|||||||
Purchases of property and equipment |
(1,827) |
(998) | |||||
Purchases of marketable securities |
- |
(18,632) | |||||
Sale/maturities of marketable securities |
245 |
15,693 | |||||
Net cash used in investing activities |
(1,582) |
(3,937) | |||||
Cash flows from financing activities: |
|||||||
Borrowings under revolving line of credit |
10,000 |
- | |||||
Principal payments on revolving line of credit |
(10,000) |
- | |||||
Principal payments of capital lease obligations |
(118) |
(10) | |||||
Payment of debt issuance costs |
(22) |
- | |||||
Proceeds from the sale of common stock in connection with employee purchase plan and |
10 |
644 | |||||
Payment of tax withholding obligations related to net share settlements of restricted stock |
(370) |
(496) | |||||
Net cash (used in) provided by financing activities |
(500) |
138 | |||||
Effect of exchange rate changes on cash and cash equivalents |
206 |
203 | |||||
Net increase in cash and cash equivalents |
1,516 |
8 | |||||
Cash and cash equivalents, beginning of year |
57,073 |
31,923 | |||||
Cash and cash equivalents, end of period |
$ 58,589 |
$ 31,931 |
| ||||||
Supplemental Information | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
The following tables provide the details of stock-based compensation, amortization of intangible assets, acquisition-related facilities adjustments, settlement expense and litigation costs included as components of other line items in the Company's Consolidated Statements of Operations and the line items in which these amounts are reported. | ||||||
Three months ended | ||||||
|
| |||||
2018 |
2017 | |||||
Stock-based compensation |
||||||
Cost of revenue - product |
$ 51 |
$ 99 | ||||
Cost of revenue - service |
132 |
317 | ||||
Cost of revenue |
183 |
416 | ||||
Research and development expense |
900 |
1,317 | ||||
Sales and marketing expense |
874 |
(88) | ||||
General and administrative expense |
867 |
1,618 | ||||
Operating expense |
2,641 |
2,847 | ||||
Total stock-based compensation |
$ 2,824 |
$ 3,263 | ||||
Amortization of intangible assets |
||||||
Cost of revenue - product |
$ 9,592 |
$ 1,566 | ||||
Sales and marketing expense |
2,717 |
693 | ||||
Operating expense |
2,717 |
693 | ||||
Total amortization of intangible assets |
$ 12,309 |
$ 2,259 | ||||
Acquisition-related facilities adjustment |
||||||
Cost of revenue - product |
$ 17 |
$ - | ||||
Cost of revenue - service |
51 |
- | ||||
Cost of revenue |
68 |
- | ||||
Research and development expense |
82 |
- | ||||
Sales and marketing expense |
38 |
- | ||||
General and administrative expense |
23 |
- | ||||
Operating expense |
143 |
- | ||||
Total acquisition-related facilities adjustment |
$ 211 |
$ - | ||||
Settlement expense |
||||||
General and administrative expense |
$ 1,730 |
$ - | ||||
Litigation costs |
||||||
General and administrative expense |
$ 673 |
$ - |
| |||
Reconciliation of Non-GAAP and GAAP Financial Measures - Historical | |||
(in thousands, except percentages) | |||
(unaudited) | |||
Three months ended | |||
|
| ||
2018 |
2017 | ||
GAAP Product revenue |
$ 51,531 |
$ 25,395 | |
Acquisition-related revenue adjustment |
5,499 |
- | |
Adjustment for new revenue standard |
2,540 |
- | |
Non-GAAP Product revenue |
$ 59,570 |
$ 25,395 | |
GAAP Service revenue |
$ 69,649 |
$ 27,973 | |
Acquisition-related revenue adjustment |
5,619 |
- | |
Adjustment for new revenue standard |
475 |
- | |
Non-GAAP Service revenue |
$ 75,743 |
$ 27,973 | |
GAAP Total revenue |
$ 121,180 |
$ 53,368 | |
Acquisition-related revenue adjustment |
11,118 |
- | |
Adjustment for new revenue standad |
3,015 |
- | |
Non-GAAP Total revenue |
$ 135,313 |
$ 53,368 | |
GAAP Gross margin - product |
35.9% |
61.6% | |
Acquisition-related revenue adjustment |
4.2% |
0.0% | |
Acquisition-related cost of revenue adjustment |
* |
0.0% | |
Adjustment for new revenue standard |
1.9% |
0.0% | |
Adjustment to cost of revenue for new revenue standard |
-0.1% |
0.0% | |
Stock-based compensation |
0.1% |
0.4% | |
Amortization of intangible assets |
18.6% |
6.2% | |
Acquisition-related facilities adjustment |
* |
0.0% | |
Non-GAAP Gross margin - product |
60.6% |
68.2% | |
GAAP Gross margin - service |
52.8% |
64.7% | |
Acquisition-related revenue adjustment |
3.6% |
0.0% | |
Acquisition-related cost of revenue adjustment |
-2.8% |
0.0% | |
Adjustment for new revenue standard |
0.3% |
0.0% | |
Adjustment to cost of revenue for new revenue standard |
* |
0.0% | |
Stock-based compensation |
0.2% |
1.2% | |
Acquisition-related facilities adjustment |
0.1% |
0.0% | |
Non-GAAP Gross margin - service |
54.2% |
65.9% | |
GAAP Total gross margin |
45.6% |
63.2% | |
Acquisition-related revenue adjustment |
3.9% |
0.0% | |
Acquisition-related cost of revenue adjustment |
-1.6% |
0.0% | |
Adjustment for new revenue standard |
1.0% |
0.0% | |
Adjustment to cost of revenue for new revenue standard |
-0.1% |
0.0% | |
Stock-based compensation |
0.2% |
0.8% | |
Amortization of intangible assets |
7.9% |
3.0% | |
Acquisition-related facilities adjustment |
0.1% |
0.0% | |
Non-GAAP Total gross margin |
57.0% |
67.0% | |
GAAP Total gross profit |
$ 55,273 |
$ 33,748 | |
Acquisition-related revenue adjustment |
11,118 |
- | |
Acquisition-related cost of revenue adjustment |
(1,977) |
- | |
Adjustment for new revenue standard |
3,015 |
- | |
Adjustment to cost of revenue for new revenue standard |
(110) |
- | |
Stock-based compensation |
183 |
416 | |
Amortization of intangible assets |
9,592 |
1,566 | |
Acquisition-related facilities adjustment |
68 |
- | |
Non-GAAP Total gross profit |
$ 77,162 |
$ 35,730 | |
|
$ 39,049 |
$ 20,209 | |
Stock-based compensation |
(900) |
(1,317) | |
Acquisition-related facilities adjustment |
(82) |
- | |
|
$ 38,067 |
$ 18,892 | |
GAAP Sales and marketing expense |
$ 31,926 |
$ 14,676 | |
Stock-based compensation |
(874) |
88 | |
Amortization of intangible assets |
(2,717) |
(693) | |
Acquisition-related facilities adjustment |
(38) |
- | |
Non-GAAP Sales and marketing expense |
$ 28,297 |
$ 14,071 | |
* Less than 0.1% impact on gross margin. |
| |||
Reconciliation of Non-GAAP and GAAP Financial Measures - Historical | |||
(in thousands, except percentages) | |||
(unaudited) | |||
Three months ended | |||
|
| ||
2018 |
2017 | ||
GAAP General and administrative expense |
$ 15,601 |
$ 9,019 | |
Stock-based compensation |
(867) |
(1,618) | |
Settlement expense |
(1,730) |
- | |
Litigation costs |
(673) |
- | |
Acquisition-related facilities adjustment |
(23) |
- | |
Non-GAAP General and administrative expense |
$ 12,308 |
$ 7,401 | |
GAAP Operating expenses |
$ 97,656 |
$ 44,530 | |
Stock-based compensation |
(2,641) |
(2,847) | |
Amortization of intangible assets |
(2,717) |
(693) | |
Settlement expense |
(1,730) |
- | |
Litigation costs |
(673) |
- | |
Acquisition-related facilities adjustment |
(143) |
- | |
Acquisition- and integration-related expense |
(4,412) |
(56) | |
Restructuring |
(6,668) |
(570) | |
Non-GAAP Operating expenses |
$ 78,672 |
$ 40,364 | |
GAAP Loss from operations |
$ (42,383) |
$ (10,782) | |
Acquisition-related revenue adjustment |
11,118 |
- | |
Acquisition-related cost of revenue adjustment |
(1,977) |
- | |
Adjustment for new revenue standard |
3,015 |
- | |
Adjustment to cost of revenue for new revenue standard |
(110) |
- | |
Stock-based compensation |
2,824 |
3,263 | |
Amortization of intangible assets |
12,309 |
2,259 | |
Settlement expense |
1,730 |
- | |
Litigation costs |
673 |
- | |
Acquisition-related facilities adjustment |
211 |
- | |
Acquisition- and integration-related expense |
4,412 |
56 | |
Restructuring |
6,668 |
570 | |
Non-GAAP Loss from operations |
$ (1,510) |
$ (4,634) | |
GAAP Loss from operations as a percentage of revenue |
-35.0% |
-20.2% | |
Acquisition-related revenue adjustment |
11.9% |
0.0% | |
Acquisition-related cost of revenue adjustment |
-1.5% |
0.0% | |
Adjustment for new revenue standard |
2.2% |
0.0% | |
Adjustment to cost of revenue for new revenue standard |
-0.1% |
0.0% | |
Stock-based compensation |
2.1% |
6.1% | |
Amortization of intangible assets |
9.1% |
4.2% | |
Settlement expense |
1.3% |
0.0% | |
Litigation costs |
0.5% |
0.0% | |
Acquisition-related facilities adjustment |
0.2% |
0.0% | |
Acquisition- and integration-related expense |
3.3% |
0.1% | |
Restructuring |
4.9% |
1.1% | |
Non-GAAP Loss from operations as a percentage of revenue |
-1.1% |
-8.7% |
| |||
Reconciliation of Non-GAAP and GAAP Financial Measures - Historical | |||
(in thousands, except percentages and per share amounts) | |||
(unaudited) | |||
Three months ended | |||
|
| ||
2018 |
2017 | ||
GAAP Net loss |
$ (44,904) |
$ (10,646) | |
Acquisition-related revenue adjustment |
11,118 |
- | |
Acquisition-related cost of revenue adjustment |
(1,977) |
- | |
Adjustment for new revenue standard |
3,015 |
- | |
Adjustment to cost of revenue for new revenue standard |
(110) |
- | |
Stock-based compensation |
2,824 |
3,263 | |
Amortization of intangible assets |
12,309 |
2,259 | |
Settlement expense |
1,730 |
- | |
Litigation costs |
673 |
- | |
Acquisition-related facilities adjustment |
211 |
- | |
Acquisition- and integration-related expense |
4,412 |
56 | |
Restructuring |
6,668 |
570 | |
Non-GAAP Net loss |
$ (4,031) |
$ (4,498) | |
Loss per share: |
|||
GAAP loss per share |
$ (0.44) |
$ (0.22) | |
Acquisition-related revenue adjustment |
0.11 |
- | |
Acquisition-related cost of revenue adjustment |
(0.02) |
- | |
Adjustment for new revenue standard |
0.03 |
- | |
Adjustment to cost of revenue for new revenue standard |
* |
- | |
Stock-based compensation |
0.03 |
0.07 | |
Amortization of intangible assets |
0.11 |
0.05 | |
Settlement expense |
0.02 |
- | |
Litigation costs |
0.01 |
- | |
Acquisition-related facilities adjustment |
* |
- | |
Acquisition- and integration-related expense |
0.04 |
* | |
Restructuring |
0.07 |
0.01 | |
Non-GAAP Loss per share |
$ (0.04) |
$ (0.09) | |
Shares used to compute loss per share: |
|||
GAAP Shares used to compute loss per share |
101,917 |
49,114 | |
Non-GAAP Shares used to compute loss per share |
101,917 |
49,114 | |
Adjusted EBITDA: |
|||
GAAP Net loss |
$ (44,904) |
(10,646) | |
Interest (income) expense, net |
599 |
(258) | |
Income tax provision |
2,170 |
123 | |
Depreciation |
2,507 |
1,823 | |
Amortization of intangible assets |
12,309 |
2,259 | |
Acquisition-related revenue adjustment |
11,118 |
- | |
Acquisition-related cost of revenue adjustment |
(1,977) |
- | |
Adjustment for new revenue standard |
3,015 |
- | |
Adjustment to cost of revenue for new revenue standard |
(110) |
- | |
Stock-based compensation |
2,824 |
3,263 | |
Settlement expense |
1,730 |
- | |
Litigation costs |
673 |
- | |
Acquisition-related facilities adjustment |
211 |
- | |
Acquisition- and integration-related expense |
4,412 |
56 | |
Restructuring |
6,668 |
570 | |
Other (income), net |
(248) |
(1) | |
Non-GAAP Adjusted EBITDA |
$ 997 |
$ (2,811) | |
* Less than |
|
||||
Reconciliation of Non-GAAP and GAAP Financial Measures - Outlook |
||||
(in millions) |
||||
(unaudited) |
||||
Year |
||||
ending |
||||
|
||||
2018 |
||||
Non-GAAP Revenue |
$ 580.0 |
|||
Less acquisition-related adjustments and impact of new revenue standard |
(31.5) |
|||
GAAP Revenue |
$ 548.5 |
|||
Adjusted EBITDA: Ribbon has not provided a reconciliation of Adjusted EBITDA for the year ending |
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