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:
gain on disposal of discontinued operations, management transition and gain on escrow
settlement. Because management discloses financial measures calculated without taking into account these items, these financial measures are characterized as "non-GAAP financial
measures" under Securities and Exchange Commission rules.
The gain on patent sale in fiscal 2015 was a $1.0 million gain that management believes is not reflective of its ongoing operations.
Non-cash tax adjustments represented the difference between the amount of taxes the Company expects to pay and the GAAP tax provision each period. Management excludes non-cash
tax adjustments because they are non-cash transactions.
Stock-based compensation charges represent non-cash charges related to equity awards granted by the Company. Although these are recurring charges to the Company's operations,
management has excluded stock-based compensation expense because it relies on valuations based on future events, such as the market price of the Company's common stock, that are
difficult to predict and are affected by market factors that are largely not within the control of the Company. Thus, management believes that excluding these charges facilitates comparisons
of the Company's operational performance in different periods, as well as with similarly determined non-GAAP financial measures of comparable companies.
Amortization of acquired intangible assets results from the Company's acquisitions of Contactual, Inc. and Zerigo, Inc. in fiscal 2012 and Voicenet Solutions Limited in fiscal 2014.
Amortization of acquired intangible assets was excluded because it was a non-cash expense that the Company does not consider part of ongoing operations when assessing the Company's
financial performance.
Acquisition-related expenses, gain on disposal of discontinued operations, management transition and gain on escrow settlement are difficult to predict and often one-time. Management
believes these expenses are not reflective of the Company's ongoing operations in terms of evaluating comparable period-to-period performance.
Management and the Company's board of directors will continue to analyze these non-GAAP financial measures to assess the business and compare operating results to the Company's
performance objectives. For example, the Company's budgeting and planning process utilizes these non-GAAP financial measures, along with other types of financial information.
The Company discloses these non-GAAP financial measures to the public as an additional means by which investors can assess the Company's performance and to identify the
Company's operating results for investors on the same basis applied by management. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for,
or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should
be carefully evaluated. The non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used
by other companies. The Company has provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures in the press release furnished
as Exhibit 99.1.
Moreover, although these non-GAAP financial measures adjust expense, they should not be viewed as a pro forma presentation reflecting the elimination of the underlying share-based
compensation programs, which are an important element of the Company's compensation structure. GAAP requires that all forms of share-based payments should be valued and included, as
appropriate, in results of operations. Management believes these expenses are a material part of the Company's operating results.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
99.1 Press Release dated January 22, 2015
2
SIGNATURES
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.
Date: January 22, 2015
|
|
|
By: /s/ MaryEllen Genovese
|
|
|
|
|
|
MaryEllen Genovese
|
|
Chief Financial Officer and Secretary
|
3
INDEX TO EXHIBITS
|
For Immediate Release
|
8x8, Inc. Reports Third Quarter Fiscal 2015 Financial Results
Record Revenue of $41.4 Million, Up 26% Year-Over-Year;
Non-GAAP Net Income of $4.1 Million, or $0.04 per Share, Representing 10% of Revenue
SAN JOSE, Calif. -- January 22, 2015 -- 8x8, Inc. (NASDAQ:EGHT), a provider of cloud-based unified communications, contact center and collaboration solutions,
today reported financial results for the third quarter fiscal 2015 ended December 31, 2014.
Third Quarter Fiscal 2015 Financial Highlights:
- Total revenue for the quarter increased 26% year-over-year to $41.4 million.
- Service revenue for the quarter increased 27% year-over-year to $37.8 million.
- New monthly recurring revenue (MRR) sold by our midmarket and channel sales teams increased 42% year over year, representing 44% of new MRR sold in
the quarter, compared with 35% in the same period last year.
- Average monthly service revenue per business customer increased 11% to a record $305, compared with $274 in the same period last year.
"8x8's results for the third quarter of fiscal 2015 were once again strong with record revenue, increasing ARPU and continued profitability driven by the successful execution
of our midmarket growth strategies," stated 8x8 CEO Vik Verma. "The investments we've made in customer support, sales engineering and product development, in particular, are
differentiating us from the competition further and enabling us to excel in areas such as security, reliability, breadth of services, time to value and global availability. With the recent senior
executive appointments of Enzo Signore as Chief Marketing Officer and Puneet Arora as Senior Vice President of Global Sales, our management team is now fully prepared to embrace the
tremendous market opportunity we see ahead for the company."
Mr. Verma added, "We are maintaining our guidance for annual revenue growth of approximately 26% in fiscal 2015, and we continue to expect non-GAAP net income as a
percentage of revenue in the 8-10% range for fiscal 2015."
Additional Third Quarter and Year-to-Date Highlights:
- GAAP net income for the third quarter of fiscal 2015 was $444,000, or $0.01 per diluted share, compared with GAAP net income of $89,000, or $0.00 per diluted share, in the
third quarter of fiscal 2014.
- Non-GAAP net income was $4.1 million, $0.04 per diluted share, or 10% of revenue, for the quarter, compared with $2.5 million, $0.03 per diluted share, or 8% of revenue, for the same
period last year.
- Service margin was 80%, compared with 81% in the same period a year ago; overall gross margin was 72%, compared with 71% in the same year ago period.
- Monthly business service revenue churn was 1.0%, compared with 1.5% in the same period last year.
- Cash, cash equivalents and investments was $187.9 million in the third quarter of fiscal 2015, compared with $174.0 million in the same period last year; cash flow from operating activities
was $13.8 million year to date.
- Ended the quarter with 41,051 business customers, up 11.7% compared with 36,753 customers in the same period a year ago.
- Recognized as the "2014 Emerging Cloud Partner of the Year" by Insight, Inc, a leading worldwide technology provider of hardware, software and service solutions at Synergy
2015, Insight's annual Partner Forum.
- Awarded five new U.S. patents and reported 100th patent milestone.
- Announced the appointment of Enzo Signore as Chief Marketing Officer.
- Announced the appointment of Puneet Arora as Senior Vice President of Global Sales.
Conference Call Information:
Management will host a conference call to discuss these results and other matters related to the Company's business today, January 22, 2015, at 4:30 pm ET. The call is accessible via the
following numbers and webcast links:
Dial In:
|
(877) 843-0417, domestic
(408) 427-3791, international
|
Replay:
|
(855) 859-2056, domestic (Conference ID # 54803999)
(404) 537-3406, international (Conference ID # 54803999)
|
Webcast:
|
http://investors.8x8.com/
|
Participants should plan to dial in or log on ten minutes prior to the start time. A telephonic replay of the call will be available three hours after the conclusion of the call until midnight
January 28, 2015. The webcast will be archived on 8x8's website for a period of one year. For additional information, visit http://investors.8x8.com
.
8x8 also reported, in accordance with NASDAQ Listing Rule 5635(c)(4), that employment inducement awards were granted to Puneet Arora and 13 new employees in
connection with their recent hiring. Mr. Arora received an option to purchase 117,702 shares of the Company's common stock with an exercise price of $8.93 per share,
which is equal to the closing price of the Company's Common Stock on January 20, 2015. In addition, Mr. Arora received restrictive stock units ("RSUs") and performance
share units ("PSUs") representing the right to receive up to 78,304 shares of common stock. Vesting of the option, RSUs and PSUs is subject to his continued service with the
Company, and the PSUs are subject to additional vesting requirements based on future market prices of the common stock. The 13 other employees received restrictive stock units for 36,742
shares of the Company's Common Stock, subject to their continued employment.
About 8x8, Inc.
8x8, Inc. (NASDAQ:EGHT) is the trusted provider of secure and reliable cloud-based unified communications and virtual contact center solutions to more than 40,000 businesses
operating in over 40 countries across six continents. 8x8's out-of-the-box cloud solutions replace traditional on-premise PBX hardware and software-based systems with a flexible and scalable
Software as a Service (SaaS) alternative, encompassing cloud business phone service, contact center solutions, and web conferencing. For additional information, visit www.8x8.com
, or www.8x8.com/UK or connect with 8x8 on Google+, Facebook, LinkedIn and Twitter.
Non-GAAP Measures
The Company has provided in this release financial information that has not been prepared in accordance with Generally Accepted Accounting Principles (GAAP). Management
uses these non-GAAP financial measures internally in analyzing our financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating the
Company's ongoing operational performance. Management believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating 8x8's
ongoing operating results and trends and in comparing financial results with other companies in the industry, many of which present similar non-GAAP financial measures to investors.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to
review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures below. A reconciliation of non-GAAP financial measures to their
most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.
Non-GAAP net income and non-GAAP net income per share
We have defined non-GAAP net income as net income for GAAP plus non-cash tax adjustments, stock-based compensation, amortization of acquired intangible assets, acquisition-related
costs, gain on patent sale, gain on disposal of discontinued operations, management transition and gain on escrow settlement. We have excluded gain on patent sale, gain on disposal
of discontinued operations and gain on escrow settlement because we consider these to have been isolated transactions and believe these are not reflective of our ongoing operations, and this
reduces comparability of periodic operating results when these are included. Non-cash tax adjustments represent the differences between the amount of taxes we expect to pay and our GAAP
tax provision each period. We have excluded stock-based compensation expense because it relies on valuations based on future events, such as the market price of our common stock, that
are difficult to predict and are affected by market factors that are largely not within the control of management. Amortization of acquired intangible assets is excluded because it is a non-cash
expense that we do not consider part of ongoing operations when assessing our financial performance, as it relates to accounting for certain purchased assets. We have excluded
acquisition-related expenses and management transition expenses because these expenses are difficult to predict and are often one-time. We define non-GAAP net income per share as non-GAAP net
income divided by the weighted-average diluted shares outstanding. We define non-GAAP net income percentage of revenue as non-GAAP net income divided by revenue. The GAAP and
non-GAAP weighted average number of diluted shares to calculate GAAP and non-GAAP earnings per share are the same.
We believe that such
exclusions facilitate comparisons to our historical operating results and to the results of other companies in the same industry, and provides investors with information that we use in evaluating
management's performance on a quarterly and annual basis.
Forward Looking Statements
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange
Act of 1934. These statements include, without limitation, information about future events based on current expectations, potential product development efforts, near and long-term objectives,
potential new business, strategies, organization changes, changing markets, future business performance and outlook. Such statements are predictions only, and actual events or results could
differ materially from those made in any forward-looking statements due to a number of risks and uncertainties. Actual results and trends may differ materially from historical results or those
projected in any such forward-looking statements depending on a variety of factors. These factors include, but are not limited to, market acceptance of new or existing services and features,
success of our efforts to target mid-market and larger distributed enterprises, changes in the competitive dynamics of the markets in which we compete, customer cancellations and rate of
churn, impact of current economic climate and adverse credit markets on our target customers, our ability to scale our business, our reliance on infrastructure of third-party network services
providers, risk of failure in our physical infrastructure, risk of failure of our software, our ability to maintain the compatibility of our software with third-party applications and mobile platforms,
continued compliance with industry standards and regulatory requirements, risks relating to our strategies and objectives for future operations, including the execution of integration plans and
realization of the expected benefits of our acquisitions, the amount and timing of costs associated with recruiting, training and integrating new employees, introduction and adoption of our cloud
communications and collaboration services in markets outside of the United States, and general economic conditions that could adversely affect our business and operating results. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see
"Risk Factors" in the Company's reports on Forms 10-K and 10-Q, as well as other reports that 8x8, Inc. files from time to time with the Securities and Exchange Commission. All
forward-looking statements are qualified in their entirety by this cautionary statement, and 8x8, Inc. undertakes no obligation to update publicly any forward-looking statement for any reason,
except as required by law, even as new information becomes available or other events occur in the future.
# # #
Investor Relations Contact:
Joan Citelli
Joan.citelli@8x8.com
(408) 654-0970
8X8, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts; unaudited)
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
Service revenue |
|
$ |
37,802 |
|
$ |
29,737 |
|
$ |
108,199 |
|
$ |
84,062 |
Product revenue |
|
|
3,570 |
|
|
3,008 |
|
|
10,684 |
|
|
8,749 |
Total revenue |
|
|
41,372 |
|
|
32,745 |
|
|
118,883 |
|
|
92,811 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of service revenue |
|
|
7,544 |
|
|
5,584 |
|
|
22,046 |
|
|
15,579 |
Cost of product revenue |
|
|
3,959 |
|
|
4,041 |
|
|
11,690 |
|
|
11,171 |
Research and development |
|
|
3,868 |
|
|
3,325 |
|
|
10,770 |
|
|
8,301 |
Sales and marketing |
|
|
20,559 |
|
|
16,051 |
|
|
59,159 |
|
|
42,868 |
General and administrative |
|
|
4,617 |
|
|
5,547 |
|
|
12,388 |
|
|
11,444 |
Gain on patent sale |
|
|
- |
|
|
- |
|
|
(1,000) |
|
|
- |
Total operating expenses |
|
|
40,547 |
|
|
34,548 |
|
|
115,053 |
|
|
89,363 |
Income (loss) from operations |
|
|
825 |
|
|
(1,803) |
|
|
3,830 |
|
|
3,448 |
Other income, net |
|
|
246 |
|
|
586 |
|
|
623 |
|
|
602 |
Income (loss) from continuing operations before |
|
|
|
|
|
|
|
|
|
|
|
|
provision (benefit) for income taxes |
|
|
1,071 |
|
|
(1,217) |
|
|
4,453 |
|
|
4,050 |
Provision (benefit) for income taxes |
|
|
627 |
|
|
(1,306) |
|
|
2,710 |
|
|
481 |
Income from continuing operations |
|
|
444 |
|
|
89 |
|
|
1,743 |
|
|
3,569 |
Income from discontinued operations, net of income tax provision |
|
|
- |
|
|
- |
|
|
- |
|
|
301 |
Gain on disposal of discontinued operations, |
|
|
|
|
|
|
|
|
|
|
|
|
net of income tax provision of $463 |
|
|
- |
|
|
- |
|
|
- |
|
|
589 |
Net income |
|
$ |
444 |
|
$ |
89 |
|
$ |
1,743 |
|
$ |
4,459 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income per share - continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
|
$ |
0.05 |
Diluted |
|
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
|
$ |
0.05 |
Income per share - discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.00 |
|
$ |
0.00 |
|
$ |
0.00 |
|
$ |
0.01 |
Diluted |
|
$ |
0.00 |
|
$ |
0.00 |
|
$ |
0.00 |
|
$ |
0.01 |
Net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
|
$ |
0.06 |
Diluted |
|
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
|
$ |
0.06 |
Weighted average number of shares: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
89,594 |
|
|
79,742 |
|
|
89,107 |
|
|
75,071 |
Diluted |
|
|
91,974 |
|
|
83,182 |
|
|
91,752 |
|
|
78,389 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Amounts include stock-based compensation expense, as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
Cost of service revenue |
|
$ |
201 |
|
$ |
101 |
|
$ |
476 |
|
$ |
237 |
Cost of product revenue |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
Research and development |
|
|
420 |
|
|
339 |
|
|
1,049 |
|
|
634 |
Sales and marketing |
|
|
966 |
|
|
660 |
|
|
2,620 |
|
|
1,400 |
General and administrative |
|
|
1,047 |
|
|
2,132 |
|
|
2,344 |
|
|
2,974 |
|
|
$ |
2,634 |
|
$ |
3,232 |
|
$ |
6,489 |
|
$ |
5,245 |
8X8, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
|
|
|
December 31, |
|
|
March 31, |
|
|
|
2014 |
|
|
2014 |
ASSETS |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
52,598 |
|
$ |
59,159 |
Short-term investments |
|
|
135,291 |
|
|
47,181 |
Accounts receivable, net |
|
|
7,233 |
|
|
5,503 |
Inventory |
|
|
532 |
|
|
811 |
Deferred tax assets |
|
|
1,732 |
|
|
2,065 |
Other current assets |
|
|
2,932 |
|
|
2,214 |
Total current assets |
|
|
200,318 |
|
|
116,933 |
Long-term investments |
|
|
- |
|
|
72,021 |
Property and equipment, net |
|
|
10,179 |
|
|
7,711 |
Intangible assets, net |
|
|
13,032 |
|
|
15,095 |
Goodwill |
|
|
37,496 |
|
|
38,461 |
Non-current deferred tax asset |
|
|
45,686 |
|
|
47,797 |
Other assets |
|
|
1,307 |
|
|
1,185 |
Total assets |
|
$ |
308,018 |
|
$ |
299,203 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
7,272 |
|
$ |
6,789 |
Accrued compensation |
|
|
6,612 |
|
|
4,583 |
Accrued warranty |
|
|
423 |
|
|
660 |
Deferred revenue |
|
|
1,491 |
|
|
1,857 |
Other accrued liabilities |
|
|
4,254 |
|
|
4,232 |
Total current liabilities |
|
|
20,052 |
|
|
18,121 |
|
|
|
|
|
|
|
Other liabilities |
|
|
2,185 |
|
|
2,904 |
Total liabilities |
|
|
22,237 |
|
|
21,025 |
|
|
|
|
|
|
|
Total stockholders' equity |
|
|
285,781 |
|
|
278,178 |
Total liabilities and stockholders' equity |
|
$ |
308,018 |
|
$ |
299,203 |
8X8, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
|
|
|
Nine Months Ended |
|
|
|
December 31, |
|
|
|
2014 |
|
|
2013 |
Cash flows from operating activities: |
|
|
|
|
|
|
Net income |
|
$ |
1,743 |
|
$ |
4,459 |
Adjustments to reconcile net income to net cash |
|
|
|
|
|
|
provided by operating activities: |
|
|
|
|
|
|
Depreciation |
|
|
2,513 |
|
|
1,888 |
Amortization of intangible assets |
|
|
1,687 |
|
|
1,074 |
Amortization of capitalized software |
|
|
255 |
|
|
92 |
Net accretion of discount and amortization of premium on |
|
|
|
|
|
|
marketable securities |
|
|
659 |
|
|
- |
Gain on disposal of discontinued operations |
|
|
- |
|
|
(589) |
Gain on escrow settlement |
|
|
- |
|
|
(565) |
Stock-based compensation |
|
|
6,489 |
|
|
5,245 |
Deferred income tax provision |
|
|
2,444 |
|
|
87 |
Other |
|
|
268 |
|
|
490 |
Changes in assets and liabilities: |
|
|
|
|
|
|
Accounts receivable, net |
|
|
(2,062) |
|
|
(1,104) |
Inventory |
|
|
235 |
|
|
(245) |
Other current and noncurrent assets |
|
|
(505) |
|
|
(570) |
Deferred cost of goods sold |
|
|
(179) |
|
|
211 |
Accounts payable |
|
|
(736) |
|
|
(1,290) |
Accrued compensation |
|
|
2,044 |
|
|
1,217 |
Accrued warranty |
|
|
(237) |
|
|
182 |
Accrued taxes and fees |
|
|
561 |
|
|
62 |
Deferred revenue |
|
|
(840) |
|
|
757 |
Other current and non-current liabilities |
|
|
(564) |
|
|
172 |
Net cash provided by operating activities |
|
|
13,775 |
|
|
11,573 |
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(4,523) |
|
|
(2,081) |
Cost of capitalized software |
|
|
(456) |
|
|
(590) |
Acquisition of business, net of cash acquired |
|
|
- |
|
|
(18,474) |
Proceeds from disposition of discontinued operations, net of transaction costs |
|
|
- |
|
|
3,000 |
Proceeds from maturity of investments |
|
|
31,400 |
|
|
- |
Sales of investments - available for sale |
|
|
29,580 |
|
|
- |
Purchases of investments - available for sale |
|
|
(77,821) |
|
|
- |
Net cash used in investing activities |
|
|
(21,820) |
|
|
(18,145) |
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
Capital lease payments |
|
|
(115) |
|
|
(26) |
Repurchase of common stock |
|
|
(1,723) |
|
|
(320) |
Proceeds from issuance of common stock, net of issuance costs |
|
|
- |
|
|
125,758 |
Proceeds from issuance of common stock under employee stock plans |
|
|
2,666 |
|
|
2,959 |
Net cash provided by financing activities |
|
|
828 |
|
|
128,371 |
|
|
|
|
|
|
|
Effect of exchange rate changes on cash |
|
|
656 |
|
|
10 |
Net (decrease) increase in cash and cash equivalents |
|
|
(6,561) |
|
|
121,809 |
|
|
|
|
|
|
|
Cash and cash equivalents at the beginning of the period |
|
|
59,159 |
|
|
50,305 |
Cash and cash equivalents at the end of the period |
|
$ |
52,598 |
|
$ |
172,114 |
8x8, Inc. |
Selected Operating Statistics |
|
|
Three Months Ended |
|
|
Dec. 31, 2013 |
|
March 31, 2014 |
|
June 30, 2014 |
|
Sept. 30, 2014 |
|
Dec. 31, 2014 |
|
|
|
|
|
|
|
|
|
|
|
Total business customers (1) |
|
36,753 |
|
37,933 |
|
39,340 |
|
40,434 |
|
41,051 |
Business customer average monthly service revenue per customer (2) |
|
$ 274 |
|
$ 287 |
|
$ 293 |
|
$ 299 |
|
$ 305 |
Monthly business service revenue churn |
|
1.5% |
|
1.2% |
|
0.4% |
|
0.9% |
|
1.0% |
|
|
|
|
|
|
|
|
|
|
|
Overall service margin |
|
81% |
|
79% |
|
80% |
|
79% |
|
80% |
Overall product margin |
|
-34% |
|
-23% |
|
-9% |
|
-8% |
|
-11% |
Overall gross margin |
|
71% |
|
70% |
|
71% |
|
72% |
|
72% |
(1) |
Business customers are defined as customers paying for service. Customers that are currently in the 30-day trial period are considered to be customers that
are paying for service. Customers subscribing to Virtual Office Solo, DNS or Cloud VPS services are not included as business customers. |
(2) |
Business customer average monthly service revenue per customer is service revenue from business customers in the period divided by the number of months in the
period divided by the simple average number of business customers during the period. |
8x8, Inc. |
RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME |
AND NON-GAAP NET INCOME PER SHARE |
(In thousands, except per share amounts; unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
Net income |
|
$ |
444 |
|
$ |
89 |
|
$ |
1,743 |
|
$ |
4,459 |
Gain on patent sale |
|
|
- |
|
|
- |
|
|
(1,000) |
|
|
- |
Gain on escrow settlement |
|
|
- |
|
|
(565) |
|
|
- |
|
|
(565) |
Gain on disposal of discontinued operations |
|
|
- |
|
|
- |
|
|
- |
|
|
(589) |
Non-cash tax adjustments |
|
|
442 |
|
|
(1,502) |
|
|
2,444 |
|
|
87 |
Amortization of acquired intangible assets |
|
|
554 |
|
|
403 |
|
|
1,687 |
|
|
1,074 |
Stock-based compensation expense |
|
|
2,634 |
|
|
3,232 |
|
|
6,489 |
|
|
5,245 |
Acquisition related expenses |
|
|
- |
|
|
672 |
|
|
- |
|
|
815 |
Management transition |
|
|
- |
|
|
204 |
|
|
- |
|
|
337 |
Non-GAAP net income |
|
$ |
4,074 |
|
$ |
2,533 |
|
$ |
11,363 |
|
$ |
10,863 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares: |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
91,974 |
|
|
83,182 |
|
|
91,752 |
|
|
78,389 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income per share - Diluted |
|
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
|
$ |
0.06 |
Gain on patent sale |
|
|
- |
|
|
- |
|
|
(0.01) |
|
|
- |
Gain on escrow settlement |
|
|
- |
|
|
(0.01) |
|
|
- |
|
|
(0.01) |
Gain on disposal of discontinued operations |
|
|
- |
|
|
- |
|
|
- |
|
|
(0.01) |
Non-cash tax adjustments |
|
|
- |
|
|
(0.02) |
|
|
0.02 |
|
|
- |
Amortization of acquired intangible assets |
|
|
0.01 |
|
|
0.01 |
|
|
0.02 |
|
|
0.02 |
Stock-based compensation expense |
|
|
0.02 |
|
|
0.04 |
|
|
0.07 |
|
|
0.07 |
Acquisition related expenses |
|
|
- |
|
|
0.01 |
|
|
- |
|
|
0.01 |
Management transition |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
Non-GAAP net income per share - Diluted |
|
$ |
0.04 |
|
$ |
0.03 |
|
$ |
0.12 |
|
$ |
0.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income percentage of revenue |
|
|
1% |
|
|
0% |
|
|
1% |
|
|
5% |
Gain on patent sale |
|
|
- |
|
|
- |
|
|
-1% |
|
|
- |
Gain on escrow settlement |
|
|
- |
|
|
-2% |
|
|
- |
|
|
-1% |
Gain on disposal of discontinued operations |
|
|
- |
|
|
- |
|
|
- |
|
|
-1% |
Non-cash tax adjustments |
|
|
1% |
|
|
-4% |
|
|
2% |
|
|
- |
Amortization of acquired intangible assets |
|
|
1% |
|
|
1% |
|
|
2% |
|
|
1% |
Stock-based compensation expense |
|
|
7% |
|
|
10% |
|
|
6% |
|
|
7% |
Acquisition related expenses |
|
|
- |
|
|
2% |
|
|
- |
|
|
1% |
Management transition |
|
|
- |
|
|
1% |
|
|
- |
|
|
- |
Non-GAAP net income percentage of revenue |
|
|
10% |
|
|
8% |
|
|
10% |
|
|
12% |
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