Submitted by admin on 10/22/2015 @ 1:15 PM Companies mentioned in this article: Gigamon
SANTA CLARA, Calif., Oct. 22, 2015 /PRNewswire/ -- Gigamon (® )Inc. (NYSE:GIMO), the leader in traffic visibility solutions, today released financial results for the third quarter ended September 26, 2015.
Third Quarter 2015 Financial Highlights: -- Revenue of $56.7 million, up 44% year-over-year. -- GAAP gross margin was 80%, compared to 77% in the third quarter of fiscal 2014. -- Non-GAAP gross margin was 81%, compared to 78% in the third quarter of fiscal 2014. -- GAAP net income was $4.3 million, or $0.12 per diluted share, compared to GAAP net loss of $3.0 million, or $0.09 per basic and diluted share, in the third quarter of fiscal 2014. -- Non-GAAP net income was $8.0 million, or $0.22 per diluted share, compared to non-GAAP net income of $1.2 million, or $0.04 per diluted share, in the third quarter of fiscal 2014. -- Increased cash and investments to $186 million, up $52 million from the third quarter of fiscal 2014.
"We continue to differentiate ourselves in this disruptive and high growth market through the delivery of innovative technology and outstanding financial performance," said Paul Hooper, chief executive officer of Gigamon. "The demand for our Security Delivery Platform portfolio continues to accelerate following 20 of the world's leading security instrumentation vendors supporting our platform. Our leadership position in the visibility market and our rapidly expanding presence in the security market establishes a healthy momentum entering what is typically our strongest quarter of the fiscal year."
Recent Business Highlights: -- In conjunction with VMWare, announced automated visibility for Software Defined Data Centers using VMware NSX Dynamic Service Insertion. -- Released the Gigamon® Visibility App for Splunk, which provides Visibility Fabric(TM) health and analytics of the Gigamon platform within a Splunk environment. -- Announced a collaboration with RSA, the Security Division of EMC, to provide pervasive visibility into Software Defined Data Center (SDDC) traffic by leveraging our Security Delivery Platform, GigaSECURE®. -- Launched version 4.4 of our market-leading visibility software, GigaVUE-OS®. -- Appointed Simon Gibson, formerly a member of the information security team at Bloomberg L.P. and an advisor to the World Economic Forum on cyber-security, as Fellow, Security Architect. -- Appointed Carlos Perea as Vice President, Sales for Latin America.
Conference Call Information:
Gigamon will host a conference call and live webcast for analysts and investors at 5:00 p.m. Eastern time on October 22, 2015. 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) 632-3384, using conference code 793805. International parties can access the call by dialing +1 (785) 424-1675, using conference code 793805.
The webcast will be accessible on Gigamon's investor relations website at http://investor .gigamon.com for a period of one year. A telephonic replay of the conference call will be available through Thursday, October 29, 2015. To access the replay, parties in the United States and Canada should call +1 (888) 203-1112 and enter conference code 793805. International parties should call +1 (719) 457-0820 and enter conference code 793805.
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 that exclude stock-based compensation and related payroll taxes, income tax effect of stock-based compensation expense, and a valuation allowance against deferred tax assets. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies. Gigamon considers these non-GAAP financial measures to be important because they provide useful measures of the operating performance of the company, exclusive of unusual events or factors that do not directly affect what we consider to be our core operating performance, and are used by the company's management for that purpose. 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 for understanding 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. Please see the reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure attached to this release.
Legal Notice Regarding Forward Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements in this press release include, but are not limited to, our expectations regarding the evolution of our marketplace, the goals for our Unified Visibility Fabric(TM) and our Security Delivery Platform and our momentum heading into our fourth fiscal quarter. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include our ability to continue to deliver and improve our products and successfully develop new products; customer acceptance and purchase of our existing products and new products; our ability to retain existing customers and generate new customers; the market for network traffic visibility solutions not continuing to develop; competition from other products and services; and general market, political, economic and business conditions. 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 our Annual Report on Form 10-K for the period ended December 27, 2014 and our most recently available Quarterly Report on Form 10-Q. The forward-looking statements in this press release are based on information available to Gigamon as of the date hereof, and Gigamon disclaims any obligation to update any forward-looking statements, except as required by law.
Gigamon Gigamon (NYSE: GIMO) provides active visibility into physical and virtual network traffic, enabling stronger security and superior performance. Gigamon's Visibility Fabric(TM) and GigaSECURE, the industry's first Security Delivery Platform, deliver advanced intelligence so that security, network and application performance management solutions in enterprise, government and service provider networks operate more efficiently and effectively. See more at www.gigamon.com , the Gigamon Blog , or follow Gigamon on Twitter , LinkedIn or Facebook .
Gigamon Inc. Consolidated Statements of Operations (In thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2015 2014 2015 2014 Revenue: Product $38,717 $26,180 $105,683 $68,804 Service 17,935 13,088 49,268 37,075 Total revenue 56,652 39,268 154,951 105,879 Cost of revenue: Product 9,613 7,396 28,616 20,682 Service 1,708 1,601 5,248 4,725 Total cost of revenue 11,321 8,997 33,864 25,407 Gross profit 45,331 30,271 121,087 80,472 Operating expenses: Research and development 12,677 10,086 36,400 31,884 Sales and marketing 21,388 17,948 61,391 55,676 General and administrative 6,950 5,217 19,671 15,668 Total operating expenses 41,015 33,251 117,462 103,228 Income (loss) from operations 4,316 (2,980) 3,625 (22,756) Interest income 106 82 330 216 Other expense, net (69) (28) (72) (63) Income (loss) before income tax provision 4,353 (2,926) 3,883 (22,603) Income tax provision (73) (66) (260) (21,093) Net income (loss) 4,280 (2,992) 3,623 (43,696) Net income (loss) per share: Basic $0.13 $(0.09) $0.11 $(1.36) Diluted $0.12 $(0.09) $0.10 $(1.36) Weighted average shares used in computing net income (loss) per share: Basic 33,830 32,354 33,412 32,028 Diluted 35,872 32,354 35,497 32,028
Gigamon Inc. Consolidated Balance Sheets (In thousands) (unaudited) September 26, 2015 December 27, 2014 ASSETS CURRENT ASSETS: Cash and cash equivalents $96,544 $38,941 Short-term investments 89,693 110,465 Accounts receivable, net 41,738 28,686 Inventories 4,113 6,551 Deferred tax assets 296 150 Prepaid expenses and other current assets 6,747 5,316 Total current assets 239,131 190,109 Property and equipment, net 7,686 7,387 Deferred tax assets, non-current 92 64 Other assets, non-current 800 426 --- --- TOTAL ASSETS $247,709 $197,986 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $3,486 $2,391 Accrued liabilities 28,810 22,838 Deferred revenue 52,434 42,183 Total current liabilities 84,730 67,412 Deferred revenue, non-current 16,805 13,322 Deferred tax liability, non-current 296 150 Other liabilities, non-current 1,326 1,667 TOTAL LIABILITIES 103,157 82,551 STOCKHOLDERS' EQUITY Common stock 3 3 Treasury stock (12,469) (12,469) Additional paid-in capital 203,082 177,714 Accumulated other comprehensive income (loss) 32 (94) Accumulated deficit (46,096) (49,719) TOTAL STOCKHOLDERS' EQUITY 144,552 115,435 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $247,709 $197,986
Gigamon Inc. Consolidated Statements of Cash Flows (In thousands) (unaudited) Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2015 2014 2015 2014 ---- ---- ---- ---- CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $4,280 $(2,992) $3,623 $(43,696) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 1,470 1,473 4,442 3,710 Stock-based compensation expense 7,869 4,738 23,780 18,635 Deferred income taxes (2) - (2) 20,877 Inventory write-down 555 499 1,567 2,936 Loss on disposal of fixed assets 12 - 12 - Changes in operating assets and liabilities: Accounts receivable (13,028) (2,282) (13,052) 4,959 Inventories 634 340 944 (7,596) Prepaid expenses and other assets (342) (1,087) (2,144) (2,184) Accounts payable 935 (1,860) 852 1,489 Accrued liabilities and other liabilities 5,525 (1,294) 5,516 (5,911) Deferred revenue 517 1,345 13,734 1,912 --- Net cash provided by (used in) operating activities 8,425 (1,120) 39,272 (4,869) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of short-term investments (32,169) (11,447) (40,168) (72,091) Proceeds from sale of short-term investments 551 - 2,006 2,000 Proceeds from maturities of short-term investments 24,485 8,095 58,818 21,507 Purchase of property and equipment (1,761) (2,368) (3,985) (7,100) Net cash (used in) provided by investing activities (8,894) (5,720) 16,671 (55,684) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from employee stock purchase plan 2,492 2,015 5,099 5,878 Proceeds from exercise of stock options 757 1,344 3,525 4,915 Costs paid for initial public offering, net - - - (8) Shares repurchased for tax withholdings on vesting of restricted stock units (2,995) (389) (6,964) (2,611) Distribution of income to Gigamon LLC members - - - (476) --- --- --- ---- Net cash provided by financing activities 254 2,970 1,660 7,698 --- NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (215) (3,870) 57,603 (52,855) CASH AND CASH EQUIVALENTS - Beginning of period 96,759 30,923 38,941 79,908 CASH AND CASH EQUIVALENTS - End of period $96,544 $27,053 $96,544 $27,053 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Income taxes paid during the period $83 $72 $348 $241
Gigamon Inc. Reconciliation of GAAP to Non-GAAP Financial Measures (In thousands, except percentages) (unaudited) Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2015 2014 2015 2014 ---- ---- ---- ---- Total Revenue $56,652 $39,268 $154,951 $105,879 Reconciliation of GAAP Gross Profit and GAAP Gross Margin to Non-GAAP Gross Profit and Non-GAAP Gross Margin: GAAP gross profit 45,331 30,271 121,087 80,472 Stock-based compensation expense 471 444 1,530 1,363 Stock-based compensation related payroll taxes 16 2 60 61 Non-GAAP gross profit $45,818 $30,717 $122,677 $81,896 GAAP gross margin 80% 77% 78% 76% Non-GAAP gross margin 81% 78% 79% 77% Reconciliation of GAAP Operating Income (Loss) and GAAP Operating Margin to Non-GAAP Operating Income (loss) and Non-GAAP Operating Margin: GAAP operating income (loss) $4,316 $(2,980) $3,625 $(22,756) Stock-based compensation expense 7,851 4,738 23,780 18,635 Stock-based compensation related payroll taxes 162 41 791 798 Non-GAAP operating income (loss) $12,329 $1,799 $28,196 $(3,323) GAAP operating margin 8% (8)% 2% (21)% Non-GAAP operating margin 22% 5% 18% (3)% Reconciliation of GAAP Net Income (Loss) Attributable to Common Stockholders to Non-GAAP Net Income (Loss): GAAP net income (loss) attributable to common stock holders $4,280 $(2,992) $3,623 $(43,696) Stock-based compensation expense 7,851 4,738 23,780 18,635 Stock-based compensation related payroll taxes 162 41 791 798 Income tax effect of Non-GAAP adjustments (4,310) (604) (9,781) 22,080 Non-GAAP net income (loss) $7,983 $1,183 $18,413 $(2,183)
Gigamon Inc. Reconciliation of GAAP to Non-GAAP Financial Measures (continued) (In thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended September 26, September 27, September 26, September 27, 2015 2014 2015 2014 ---- ---- ---- ---- Reconciliation of GAAP Diluted Net Income (Loss) per Share to Non-GAAP Diluted Net Income (Loss) per Share: GAAP diluted net income (loss) per share $0.12 $(0.09) $0.10 $(1.36) Stock-based compensation expense 0.22 0.15 0.67 0.58 Stock-based compensation related payroll taxes - - 0.02 0.02 Income tax effect of non-GAAP adjustments (0.12) (0.02) (0.27) 0.69 Impact of difference in number of GAAP and non-GAAP diluted shares - - (0.01) - Non-GAAP diluted net income (loss) per share $0.22 $0.04 $0.51 $(0.07) Reconciliation of GAAP Diluted Weighted- Average Number of Shares to Non-GAAP Diluted Weighted-Average Number of Shares: GAAP diluted weighted-average number of shares 35,872 32,354 35,497 32,028 Dilutive impact due to stock- based compensation 498 1,444 726 - Non-GAAP diluted weighted- average number of shares 36,370 33,798 36,223 32,028
Reconciliation of GAAP to Non-GAAP Consolidated Statements of Operations For the Three and Nine Months Ended September 26, 2015 and September 27, 2014 (In thousands, except per share amounts and percentages) (unaudited) Three Months Ended Nine Months Ended September 26, 2015 September 27, 2014 September 26, 2015 September 27, 2014 As Adjustments Non-GAAP As Adjustments Non-GAAP As Adjustments Non-GAAP As Adjustments Non-GAAP Reported Reported Reported Reported Revenue: Product $38,717 $ - $38,717 $26,180 $ - $26,180 $105,683 $ - $105,683 $68,804 $ - $68,804 Service 17,935 - 17,935 13,088 - 13,088 49,268 - 49,268 37,075 - 37,075 --- --- --- --- Total revenue 56,652 - 56,652 39,268 - 39,268 154,951 - 154,951 105,879 - 105,879 Cost of revenue: Product (1) 9,613 (359) 9,254 7,396 (288) 7,108 28,616 (1,071) 27,545 20,682 (829) 19,853 Service (1) 1,708 (128) 1,580 1,601 (158) 1,443 5,248 (519) 4,729 4,725 (595) 4,130 ---- ---- ---- ---- Total cost of revenue 11,321 (487) 10,834 8,997 (446) 8,551 33,864 (1,590) 32,274 25,407 (1,424) 23,983 ---- ---- Gross profit 45,331 487 45,818 30,271 446 30,717 121,087 1,590 122,677 80,472 1,424 81,896 --- --- Product Gross Margin 75% 76% 72% 73% 73% 74% 70% 71% Service Gross Margin 90% 91% 88% 89% 89% 90% 87% 89% Total Gross Margin 80% 81% 77% 78% 78% 79% 76% 77% Operating expenses: Research and development (1) 12,677 (2,532) 10,145 10,086 (1,288) 8,798 36,400 (7,519) 28,881 31,884 (6,335) 25,549 Sales and marketing (1) 21,388 (2,534) 18,854 17,948 (1,095) 16,853 61,391 (8,023) 53,368 55,676 (6,501) 49,175 General and administrative (1) 6,950 (2,460) 4,490 5,217 (1,950) 3,267 19,671 (7,439) 12,232 15,668 (5,173) 10,495 Total operating expenses 41,015 (7,526) 33,489 33,251 (4,333) 28,918 117,462 (22,981) 94,481 103,228 (18,009) 85,219 Income (loss) from operations 4,316 8,013 12,329 (2,980) 4,779 1,799 3,625 24,571 28,196 (22,756) 19,433 (3,323) Other income (expense): Interest income 106 - 106 82 - 82 330 - 330 216 - 216 Other expense, net (69) - (69) (28) - (28) (72) - (72) (63) - (63) --- --- --- --- --- --- --- --- --- --- --- --- Income (loss) before income taxes 4,353 8,013 12,366 (2,926) 4,779 1,853 3,883 24,571 28,454 (22,603) 19,433 (3,170) Income tax (expense) benefit (2) (3) (73) (4,310) (4,383) (66) (604) (670) (260) (9,781) (10,041) (21,093) 22,080 987 Net income (loss) $4,280 $3,703 $7,983 $(2,992) $4,175 $1,183 $3,623 $14,790 $18,413 $(43,696) $41,513 $(2,183) Net income (loss) per share: Basic $0.13 $0.11 $0.24 $(0.09) $0.13 $0.04 $0.11 $0.44 $0.55 $(1.36) $1.29 $(0.07) Diluted $0.12 $0.10 $0.22 $(0.09) $0.13 $0.04 $0.10 $0.41 $0.51 $(1.36) $1.29 $(0.07) Weighted-average number of shares used in per share amounts: Basic 33,830 - 33,830 32,354 - 32,354 33,412 - 33,412 32,028 - 32,028 === === === === Diluted 35,872 498 36,370 32,354 1,444 33,798 35,497 726 36,223 32,028 - 32,028 === === =