SAN FRANCISCO, Feb. 14, 2017 /PRNewswire/ -- RPX Corporation
(together with its subsidiaries, "RPX", "the Company") (NASDAQ:
RPXC), the leading provider of patent risk management and discovery
management solutions, today announced its financial results for the
fourth quarter and year ended December 31, 2016.
Highlights
- Revenue for 2016 totaled $333.1
million, up 14% compared to $291.9
million for 2015
- Discovery services revenue for 2016 totaled $66.1 million
- Revenue for the fourth quarter of 2016 totaled $81.8 million, up 12% compared to $72.8 million in the prior year period
- There were 348 clients in RPX's patent risk management network
as of December 31,
2016.
"RPX was founded to bring efficiency and transparency to the
patent market, and our financial performance in 2016 reflects our
continued progress in achieving that goal," said Martin Roberts, Interim CEO and General Counsel
of RPX Corporation. "With our
increased emphasis on improving execution, generating cash and
returning value to shareholders, we enter 2017 as a stronger, more
nimble organization and are optimistic about RPX's opportunity to
further impact both the patent and eDiscovery markets."
Summary Results
Revenue for the fourth quarter of 2016 was $81.8 million, compared to $72.8 million in the prior year period. Revenue
for 2016 was $333.1 million, compared
to $291.9 million for 2015.
GAAP net income for the fourth quarter of 2016 was $1.7 million or $0.03 per diluted share, compared to $5.5 million or $0.10 per diluted share in the fourth quarter of
2015. GAAP net income for 2016 was $18.2
million or $0.36 per diluted
share, compared to $39.4 million or
$0.71 per diluted share for 2015.
Non-GAAP net income for the fourth quarter of 2016, which
excludes stock-based compensation, the amortization of acquired
intangibles, fair value adjustments on deferred payment
obligations, gains on extinguishment of deferred payment
obligations, other-than-temporary impairment on short-term
investments, realized losses on exchange of short-term investments,
and their related tax effects, was $6.2
million or $0.12 per diluted
share, compared to $11.7 million or
$0.21 per diluted share in the fourth
quarter of 2015. Non-GAAP net income for 2016 was $35.7 million or $0.70 per diluted share, compared to $54.7 million or $0.99 per diluted share for 2015.
Non-GAAP adjusted EBITDA less net patent spend, the Company's
preferred measure of adjusted pre-tax cash flow, was $9.1 million for the fourth quarter of 2016 and
$108.2 million for 2016.
Net patent acquisition spend during the fourth quarter totaled
$45.5 million, and included 12 new
patent acquisitions. Net patent acquisition spend during the year
totaled $117.4 million.
As of December 31, 2016, RPX had cash, cash equivalents,
and short-term investments of $191.0
million.
Business Outlook
This outlook reflects the Company's current and preliminary view
and may be subject to change. Please see the paragraph
regarding "Forward-Looking Statements" at the end of this news
release.
The Company provided the following business outlook for the
first quarter of fiscal 2017:
|
Subscription and
Discovery revenue[1]
|
$79 - $81
million
|
|
Fee-related
revenue
|
$1 million
|
|
Total
revenue
|
$80 - $82
million
|
|
Operating income
(non-GAAP)
|
$9 - $11
million
|
|
Net income
(non-GAAP)
|
$5 - $7
million
|
|
Consolidated
adjusted EBITDA (non-GAAP)
|
$51 - $52
million
|
|
Effective tax rate
(non-GAAP)
|
37%
|
|
Weighted-average
diluted shares outstanding
|
49 million
|
The Company provided the following business outlook for the full
year 2017:
|
Subscription
revenue[1]
|
$240 - $250
million
|
|
Discovery
revenue
|
$70 - $79
million
|
|
Fee-related
revenue
|
$5 - $15
million
|
|
Total
revenue
|
$315 - $344
million
|
|
Cost of revenue
(non-GAAP)
|
$193 - $198
million
|
|
SG&A
(non-GAAP)
|
$73 - $78
million
|
|
Net income
(non-GAAP)
|
$31 - $42
million
|
|
|
|
Patent risk
management adjusted EBITDA (non-GAAP)
|
$183 - $199
million
|
|
Discovery services
adjusted EBITDA (non-GAAP)
|
$19 - $23
million
|
|
Consolidated
adjusted EBITDA (non-GAAP)
|
$202 - $222
million
|
|
Net patent
spend
|
$110 - $115
million
|
|
Consolidated
adjusted EBITDA less net patent spend (non-GAAP)
|
$87 - $112
million
|
|
|
|
Effective tax rate
(non-GAAP)
|
37%
|
|
Weighted-average
diluted shares outstanding
|
50 million
|
The Company provided the following supplemental information
regarding amortization expense for the full year 2017:
|
Amortization of
patent assets acquired through December 31, 2016
|
$127
million
|
|
Amortization of
patent assets to be acquired during fiscal 2017
|
$26 - $29
million
|
|
Total amortization
of patent assets
|
$153 - $156
million
|
|
|
|
Amortization of
acquired intangible assets[2]
|
$8 - $9
million
|
|
|
|
|
|
|
|
|
|
|
|
[1]
|
Subscription revenue
is comprised of revenue generated from membership subscription
services, premiums earned, net of ceding commissions, from
insurance policies, and management fees related to the Company's
insurance business.
|
|
[2]
|
RPX excludes
amortization expense related to intangible assets (other than
patents) acquired in conjunction with the acquisition of businesses
from its non-GAAP financial measures.
|
The above outlook is forward-looking. Actual results may differ
materially. The Company is not able, at this time, to provide a
forward-looking reconciliation to GAAP outlook for the non-GAAP
financial metric outlook it has provided above for the first
quarter and full year 2017 because of the difficulty of estimating
certain items that are excluded from the non-GAAP financial
metrics, including those items listed in "Use of Non-GAAP Financial
Information" below, the effect of which may be significant. Please
refer to the information under the caption "Use of Non-GAAP
Financial Information" below.
|
RPX
Corporation
|
|
Historical
Quarterly Information
|
|
(in
thousands)
|
|
(unaudited)
|
|
Three Months
Ended
|
|
March 31,
2016
|
|
June 30,
2016
|
|
September 30,
2016
|
|
December 31,
2016
|
|
Subscription
revenue[1]
|
$
|
67,112
|
|
|
$
|
63,219
|
|
|
$
|
62,414
|
|
|
$
|
62,688
|
|
|
Discovery
revenue
|
10,578
|
|
|
19,258
|
|
|
17,987
|
|
|
18,289
|
|
|
Fee-related
revenue
|
2,045
|
|
|
632
|
|
|
8,060
|
|
|
825
|
|
|
Total
revenue
|
$
|
79,735
|
|
|
$
|
83,109
|
|
|
$
|
88,461
|
|
|
$
|
81,802
|
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
$
|
5,174
|
|
|
$
|
8,135
|
|
|
$
|
14,016
|
|
|
$
|
8,063
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
diluted shares outstanding
|
52,616
|
|
|
51,557
|
|
|
50,247
|
|
|
49,642
|
|
|
|
|
|
|
|
|
|
|
|
|
[1]
|
Subscription revenue
is comprised of revenue generated from membership subscription
services, premiums earned, net of ceding commissions, from
insurance policies, and management fees related to the Company's
insurance business.
|
|
RPX
Corporation
|
|
Quarterly
Reconciliation of Net Income to Non-GAAP Adjusted EBITDA Less Net
Patent Spend
|
|
(in
thousands)
|
|
(unaudited)
|
|
Three Months
Ended
|
|
March 31,
2016
|
|
June 30,
2016
|
|
September 30,
2016
|
|
December 31,
2016
|
|
Net
income
|
$
|
4,237
|
|
|
$
|
4,150
|
|
|
$
|
8,115
|
|
|
$
|
1,733
|
|
|
Provision for
income taxes
|
2,742
|
|
|
2,436
|
|
|
4,651
|
|
|
4,245
|
|
|
Interest and other
(income) expense, net
|
(1,805)
|
|
|
1,549
|
|
|
1,250
|
|
|
2,085
|
|
|
Depreciation and
amortization
|
44,555
|
|
|
41,032
|
|
|
43,725
|
|
|
42,311
|
|
|
EBITDA
|
49,729
|
|
|
49,167
|
|
|
57,741
|
|
|
50,374
|
|
|
Stock-based
compensation
|
5,022
|
|
|
4,976
|
|
|
4,341
|
|
|
4,229
|
|
|
Adjusted EBITDA
(non-GAAP)[2]
|
54,751
|
|
|
54,143
|
|
|
62,082
|
|
|
54,603
|
|
|
Net patent
spend
|
(16,249)
|
|
|
(20,885)
|
|
|
(34,800)
|
|
|
(45,495)
|
|
|
Adjusted EBITDA
less net patent spend (non-GAAP)
|
$
|
38,502
|
|
|
$
|
33,258
|
|
|
$
|
27,282
|
|
|
$
|
9,108
|
|
|
|
|
|
|
|
|
|
|
|
|
[2]
|
RPX calculates
non-GAAP adjusted EBITDA as GAAP earnings before other income or
expenses, net, taxes, depreciation, amortization, and stock-based
compensation expenses (inclusive of related employer payroll
taxes).
|
Conference Call
RPX management will host a conference call and live webcast for
analysts and investors at 2:00 p.m.
PST/5:00 p.m. EST on
February 14, 2017. Parties in the United States and Canada can access the call by dialing
1-877-723-9520, using conference code
2653817. International parties can access the call by
dialing 1-719-325-4893, using conference code 2653817.
The conference call will be webcast and investors will be able
to access the webcast and slide presentation from the "Investor
Relations" section of the company's website at www.rpxcorp.com. A
replay of the webcast will be available online at the
aforementioned website following the conclusion of the conference
call.
About RPX
RPX Corporation (NASDAQ: RPXC) is the leading provider of patent
risk management and discovery management solutions. Since its
founding in 2008, RPX has introduced efficiency to the patent
market by providing a rational alternative to litigation. The
San Francisco-based company's
pioneering approach combines principal capital, deep patent
expertise, and client contributions to generate enhanced patent
buying power. By acquiring patents and patent rights, RPX helps to
mitigate and manage patent risk for its growing client network.
As of December 31, 2016, RPX had invested over $2 billion to acquire more than 16,600 US and
international patent assets and rights on behalf of nearly 350
clients in eight key sectors: automotive, consumer electronics and
PCs, E-commerce and software, financial services, media content and
distribution, mobile communications and devices, networking, and
semiconductors.
RPX subsidiary Inventus is a leading international discovery
management provider focused on reducing the costs and risks
associated with the discovery process through the effective use of
technology solutions. Inventus has been providing litigation
support services to corporate legal departments, law firms and
government agencies since 1991.
Use of Non-GAAP Financial Information
This news release dated February 14, 2017 contains non-GAAP
financial measures. Tables are provided in this news release that
reconcile the historical non-GAAP financial measures to the most
directly comparable financial measures prepared in accordance with
Generally Accepted Accounting Principles (GAAP). These non-GAAP
financial measures include non-GAAP cost of revenue, non-GAAP
selling, general and administrative expenses, non-GAAP operating
income, non-GAAP other income (expense), net, non-GAAP net income,
non-GAAP adjusted EBITDA, non-GAAP net income per share, and
non-GAAP adjusted EBITDA less net patent spend.
To supplement the Company's condensed consolidated financial
statements presented on a GAAP basis, management believes that
these non-GAAP measures provide useful information about the
Company's core operating results and thus are appropriate to
enhance the overall understanding of the Company's past financial
performance and its prospects for the future. Management is
excluding from some or all of its non-GAAP operating results (1)
stock-based compensation expenses (inclusive of related employer
payroll taxes), (2) the amortization of acquired intangible assets
(other than patents), (3) fair value adjustments on deferred
payment obligations, (4) gains on extinguishment of deferred
payment obligations, (5) other-than-temporary impairment on
short-term investments, (6) realized losses on exchange of
short-term investments, and (7) their related tax effects.
Management uses these non-GAAP measures to evaluate the
Company's financial results and trends, allocate internal
resources, prepare and approve our annual budget, develop short-
and long-term operating plans, assess the health of our business
and determine company-wide incentive compensation. Management
believes these non-GAAP measures may prove useful to investors who
wish to consider the impact of certain items when comparing the
Company's financial performance with that of other
companies. The adjustments to the Company's GAAP results are
made with the intent of providing both management and investors a
more complete understanding of the Company's underlying operational
results, trends and performance.
There are limitations in using non-GAAP financial measures
because non-GAAP financial measures are not prepared in accordance
with GAAP and may be different from non-GAAP financial measures
used by other companies. The non-GAAP financial measures are
limited in value because they exclude certain items that may have a
material impact on our reported financial results. In addition,
they are subject to inherent limitations as they reflect the
exercise of judgment by management about which items are adjusted
to calculate our non-GAAP financial measures. Management
compensates for these limitations by analyzing current and future
results on a GAAP basis as well as a non-GAAP basis and also by
providing GAAP measures in our public disclosures.
The presentation of additional information should not be
considered in isolation or as a substitute for or superior to
financial results determined in accordance with GAAP. Investors are
encouraged to review the reconciliation of these non-GAAP measures
to their most directly comparable GAAP financial measure and not to
rely on any single financial measure to evaluate our business.
Forward-Looking Statements
This news release and its attachments contain forward-looking
statements within the meaning of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These
forward-looking statements include statements regarding RPX's
future financial performance as well as any statements regarding
the Company's strategic and operational plans. The Company's
actual results may differ materially from those anticipated in
these forward-looking statements. Factors that may contribute
to such differences include, among others, the Company's ability to
maintain an adequate rate of growth, the success of the Company's
new initiatives, the Company's ability to integrate and manage the
acquisition of Inventus Solutions, Inc., and the Company's ability
to attract new clients and retain existing
clients. Forward-looking statements are often identified by
the use of words such as, but not limited to, "anticipate,"
"believe," "can," "continue," "could," "estimate," "expect,"
"intend," "may," "plan," "project," "seek," "should," "target,"
"will," "would," and similar expressions or variations intended to
identify forward-looking statements. More information
about potential factors that could affect the Company's business
and financial results is contained in the Company's most recent
annual report on Form 10-K, its quarterly reports on Form 10-Q, and
the Company's other filings with the SEC. The Company does not
intend, and undertakes no duty, to update any forward-looking
statements to reflect future events or circumstances.
|
Contacts:
|
|
|
|
Investor
Relations
|
Media
Relations
|
|
JoAnn
Horne
|
Jen Costa
|
|
Market Street
Partners
|
RPX
Corporation
|
|
+1
415-445-3233
|
+1
415-852-3180
|
|
ir@rpxcorp.com
|
media@rpxcorp.com
|
|
RPX
Corporation
|
|
Consolidated
Statements of Operations
|
|
(in thousands,
except per share data)
|
|
(unaudited)
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Revenue
|
$
|
81,802
|
|
|
$
|
72,831
|
|
|
$
|
333,107
|
|
|
$
|
291,881
|
|
|
Cost of
revenue
|
49,696
|
|
|
39,475
|
|
|
197,262
|
|
|
148,858
|
|
|
Selling, general and
administrative expenses
|
24,043
|
|
|
20,199
|
|
|
100,457
|
|
|
77,428
|
|
|
Gain on sale of
patent assets, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(592)
|
|
|
Operating
income
|
8,063
|
|
|
13,157
|
|
|
35,388
|
|
|
66,187
|
|
|
Interest and other
expense, net:
|
|
|
|
|
|
|
|
|
Interest
income
|
158
|
|
|
225
|
|
|
506
|
|
|
740
|
|
|
Interest
expense
|
(860)
|
|
|
—
|
|
|
(3,015)
|
|
|
—
|
|
|
Other expense,
net
|
(1,383)
|
|
|
(2,844)
|
|
|
(570)
|
|
|
(1,428)
|
|
|
Total interest and
other expense, net
|
(2,085)
|
|
|
(2,619)
|
|
|
(3,079)
|
|
|
(688)
|
|
|
Income before
provision for income taxes
|
5,978
|
|
|
10,538
|
|
|
32,309
|
|
|
65,499
|
|
|
Provision for income
taxes
|
4,245
|
|
|
5,011
|
|
|
14,074
|
|
|
26,077
|
|
|
Net income
|
$
|
1,733
|
|
|
$
|
5,527
|
|
|
$
|
18,235
|
|
|
$
|
39,422
|
|
|
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.04
|
|
|
$
|
0.10
|
|
|
$
|
0.36
|
|
|
$
|
0.72
|
|
|
Diluted
|
$
|
0.03
|
|
|
$
|
0.10
|
|
|
$
|
0.36
|
|
|
$
|
0.71
|
|
|
Weighted-average
shares used in computing net income per share:
|
|
|
|
|
|
|
|
|
Basic
|
49,061
|
|
|
54,260
|
|
|
50,462
|
|
|
54,432
|
|
|
Diluted
|
49,642
|
|
|
55,002
|
|
|
51,001
|
|
|
55,410
|
|
|
RPX
Corporation
|
|
Consolidated
Balance Sheets
|
|
(in
thousands)
|
|
(unaudited)
|
|
December
31,
|
|
2016
|
|
2015
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
|
100,111
|
|
|
$
|
94,983
|
|
|
Short-term
investments
|
90,877
|
|
|
231,015
|
|
|
Restricted
cash
|
500
|
|
|
701
|
|
|
Accounts receivable,
net
|
64,395
|
|
|
13,905
|
|
|
Prepaid expenses and
other current assets
|
4,524
|
|
|
12,643
|
|
|
Total current
assets
|
260,407
|
|
|
353,247
|
|
|
Patent assets,
net
|
212,999
|
|
|
254,560
|
|
|
Property and
equipment, net
|
6,948
|
|
|
4,733
|
|
|
Intangible assets,
net
|
56,050
|
|
|
1,801
|
|
|
Goodwill
|
151,322
|
|
|
19,978
|
|
|
Restricted cash, less
current portion
|
965
|
|
|
727
|
|
|
Other
assets
|
8,337
|
|
|
6,896
|
|
|
Deferred tax
assets
|
38,261
|
|
|
16,619
|
|
|
Total
assets
|
$
|
735,289
|
|
|
$
|
658,561
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
|
3,197
|
|
|
$
|
959
|
|
|
Accrued
liabilities
|
16,798
|
|
|
14,842
|
|
|
Deferred
revenue
|
118,856
|
|
|
110,921
|
|
|
Deferred payment
obligations
|
—
|
|
|
2,383
|
|
|
Current portion of
long-term debt
|
6,474
|
|
|
—
|
|
|
Other current
liabilities
|
1,484
|
|
|
467
|
|
|
Total current
liabilities
|
146,809
|
|
|
129,572
|
|
|
Deferred revenue, less current
portion
|
11,552
|
|
|
4,731
|
|
|
Deferred tax
liabilities
|
4,023
|
|
|
—
|
|
|
Long-term debt, less
current portion
|
88,110
|
|
|
—
|
|
|
Other
liabilities
|
10,514
|
|
|
7,779
|
|
|
Total
liabilities
|
261,008
|
|
|
142,082
|
|
|
Stockholders'
equity:
|
|
|
|
|
Common
stock
|
5
|
|
|
5
|
|
|
Additional paid-in
capital
|
360,462
|
|
|
344,610
|
|
|
Retained
earnings
|
130,249
|
|
|
172,115
|
|
|
Accumulated other
comprehensive loss
|
(16,435)
|
|
|
(251)
|
|
|
Total stockholders'
equity
|
474,281
|
|
|
516,479
|
|
|
Total liabilities and
stockholders' equity
|
$
|
735,289
|
|
|
$
|
658,561
|
|
|
RPX
Corporation
|
|
Consolidated
Statements of Cash Flows
|
|
(in
thousands)
|
|
(unaudited)
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
Operating
activities
|
|
|
|
|
Net income
|
$
|
18,235
|
|
|
$
|
39,422
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
171,623
|
|
|
145,835
|
|
|
Stock-based
compensation
|
18,275
|
|
|
17,594
|
|
|
Excess tax benefit
from stock-based compensation
|
(103)
|
|
|
(1,593)
|
|
|
Gain on sale of
patent assets
|
—
|
|
|
(592)
|
|
|
Amortization of
premium on investments
|
2,247
|
|
|
6,666
|
|
|
Deferred
taxes
|
(13,951)
|
|
|
(13,010)
|
|
|
Unrealized foreign
currency loss
|
2,689
|
|
|
—
|
|
|
Fair value
adjustments on deferred payment obligations
|
(1,920)
|
|
|
(3,887)
|
|
|
Gain on
extinguishment of deferred payment obligation
|
(463)
|
|
|
(3,000)
|
|
|
Other-than-temporary
impairment of short-term investments
|
—
|
|
|
5,096
|
|
|
Realized loss on
exchange of short-term investments
|
290
|
|
|
3,444
|
|
|
Other
|
2,457
|
|
|
(60)
|
|
|
Changes in assets and
liabilities, net of business acquired:
|
|
|
|
|
Accounts
receivable
|
(39,737)
|
|
|
10,888
|
|
|
Prepaid expenses and
other assets
|
10,344
|
|
|
(17,651)
|
|
|
Accounts
payable
|
923
|
|
|
724
|
|
|
Accrued and other
current liabilities
|
1,693
|
|
|
4,631
|
|
|
Deferred
revenue
|
14,654
|
|
|
(21,284)
|
|
|
Net cash provided by
operating activities
|
187,256
|
|
|
173,223
|
|
|
Investing
activities
|
|
|
|
|
Purchases of
investments
|
(70,980)
|
|
|
(273,853)
|
|
|
Maturities of
investments
|
60,143
|
|
|
254,360
|
|
|
Sales of
investments
|
145,925
|
|
|
21,650
|
|
|
Business acquisition,
net of cash acquired
|
(228,452)
|
|
|
(425)
|
|
|
Decrease in
restricted cash
|
298
|
|
|
247
|
|
|
Purchases of property
and equipment
|
(3,667)
|
|
|
(2,163)
|
|
|
Acquisitions of
patent assets
|
(116,742)
|
|
|
(132,834)
|
|
|
Proceeds from sale of
patent assets
|
—
|
|
|
650
|
|
|
Acquisition of other
assets
|
—
|
|
|
(2,500)
|
|
|
Net cash used in
investing activities
|
(213,475)
|
|
|
(134,868)
|
|
|
Financing
activities
|
|
|
|
|
Repayments of
principal on deferred payment obligations
|
—
|
|
|
(2,935)
|
|
|
Proceeds from
deferred payment obligations
|
—
|
|
|
6,270
|
|
|
Proceeds from
issuance of term debt
|
100,000
|
|
|
—
|
|
|
Payment of debt
issuance costs
|
(2,003)
|
|
|
—
|
|
|
Repayment of
principal on term debt
|
(3,750)
|
|
|
—
|
|
|
Deferred acquisition
payment
|
(1,320)
|
|
|
—
|
|
|
Proceeds from
exercise of stock options
|
3,766
|
|
|
4,953
|
|
|
Taxes paid related to net share
settlements of restricted stock units
|
(4,185)
|
|
|
(5,097)
|
|
|
Excess tax benefit
from stock-based compensation
|
103
|
|
|
1,593
|
|
|
Payments of capital
leases
|
(461)
|
|
|
—
|
|
|
Repurchase of common
stock
|
(60,101)
|
|
|
(26,175)
|
|
|
Net cash provided by
(used in) financing activities
|
32,049
|
|
|
(21,391)
|
|
|
Foreign-currency
effect on cash and cash equivalents
|
(702)
|
|
|
—
|
|
|
Net increase in cash
and cash equivalents
|
5,128
|
|
|
16,964
|
|
|
Cash and cash
equivalents at beginning of period
|
94,983
|
|
|
78,019
|
|
|
Cash and cash
equivalents at end of period
|
$
|
100,111
|
|
|
$
|
94,983
|
|
|
RPX
Corporation
|
|
Reconciliation of
GAAP to Non-GAAP Net Income Per Share
|
|
(in thousands,
except per share data)
|
|
(unaudited)
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net income
|
$
|
1,733
|
|
|
$
|
5,527
|
|
|
$
|
18,235
|
|
|
$
|
39,422
|
|
|
Stock-based
compensation[1]
|
4,229
|
|
|
4,533
|
|
|
18,568
|
|
|
18,015
|
|
|
Amortization of
acquired intangible assets[2]
|
2,402
|
|
|
431
|
|
|
9,611
|
|
|
1,725
|
|
|
Fair value adjustment
on deferred payment obligations[3]
|
—
|
|
|
(655)
|
|
|
(1,920)
|
|
|
(3,887)
|
|
|
Gain on
extinguishment of deferred payment
obligations[3]
|
—
|
|
|
(3,000)
|
|
|
(463)
|
|
|
(3,000)
|
|
|
Other-than-temporary
impairment on short-term investments[3]
|
—
|
|
|
3,181
|
|
|
—
|
|
|
5,096
|
|
|
Realized loss on
exchange of short-term investments[3]
|
—
|
|
|
3,336
|
|
|
188
|
|
|
3,336
|
|
|
Income tax
adjustments[4]
|
(2,163)
|
|
|
(1,649)
|
|
|
(8,474)
|
|
|
(6,037)
|
|
|
Non-GAAP net
income
|
$
|
6,201
|
|
|
$
|
11,704
|
|
|
$
|
35,745
|
|
|
$
|
54,670
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income
per share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.13
|
|
|
$
|
0.22
|
|
|
$
|
0.71
|
|
|
$
|
1.00
|
|
|
Diluted
|
$
|
0.12
|
|
|
$
|
0.21
|
|
|
$
|
0.70
|
|
|
$
|
0.99
|
|
|
Weighted-average
shares used in computing net income per share:
|
|
|
|
|
|
|
|
|
Basic
|
49,061
|
|
|
54,260
|
|
|
50,462
|
|
|
54,432
|
|
|
Diluted
|
49,642
|
|
|
55,002
|
|
|
51,001
|
|
|
55,410
|
|
|
RPX
Corporation
|
|
Reconciliation of
GAAP to Non-GAAP Cost of Revenue
|
|
(in
thousands)
|
|
(unaudited)
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Cost of
revenue
|
$
|
49,696
|
|
|
$
|
39,475
|
|
|
$
|
197,262
|
|
|
$
|
148,858
|
|
|
Amortization of
acquired intangible assets[2]
|
(527)
|
|
|
(50)
|
|
|
(2,119)
|
|
|
(200)
|
|
|
Non-GAAP cost of
revenue
|
$
|
49,169
|
|
|
$
|
39,425
|
|
|
$
|
195,143
|
|
|
$
|
148,658
|
|
|
|
|
RPX
Corporation
|
|
Reconciliation of
GAAP to Non-GAAP Selling, General and Administrative
Expenses
|
|
(in
thousands)
|
|
(unaudited)
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Selling, general and
administrative expenses
|
$
|
24,043
|
|
|
$
|
20,199
|
|
|
$
|
100,457
|
|
|
$
|
77,428
|
|
|
Stock-based
compensation[1]
|
(4,229)
|
|
|
(4,533)
|
|
|
(18,568)
|
|
|
(18,015)
|
|
|
Amortization of
acquired intangible assets[2]
|
(1,875)
|
|
|
(381)
|
|
|
(7,492)
|
|
|
(1,525)
|
|
|
Non-GAAP selling,
general and administrative expenses
|
$
|
17,939
|
|
|
$
|
15,285
|
|
|
$
|
74,397
|
|
|
$
|
57,888
|
|
|
|
RPX
Corporation
|
|
Reconciliation of
GAAP to Non-GAAP Interest and Other Income (Expense),
Net
|
|
(in
thousands)
|
|
(unaudited)
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Interest and other
expense, net
|
$
|
(2,085)
|
|
|
$
|
(2,619)
|
|
|
$
|
(3,079)
|
|
|
$
|
(688)
|
|
|
Fair value adjustment
on deferred payment obligations[3]
|
—
|
|
|
(655)
|
|
|
(1,920)
|
|
|
(3,887)
|
|
|
Gain on
extinguishment of deferred payment
obligations[3]
|
—
|
|
|
(3,000)
|
|
|
(463)
|
|
|
(3,000)
|
|
|
Other-than-temporary
impairment on short-term investments[3]
|
—
|
|
|
3,181
|
|
|
—
|
|
|
5,096
|
|
|
Realized loss on
exchange of short-term investments[3]
|
—
|
|
|
3,336
|
|
|
188
|
|
|
3,336
|
|
|
Non-GAAP interest and
other income (expense), net
|
$
|
(2,085)
|
|
|
$
|
243
|
|
|
$
|
(5,274)
|
|
|
$
|
857
|
|
|
|
|
RPX
Corporation
|
|
Reconciliation of
Net Income to Non-GAAP Adjusted EBITDA Less Net Patent
Spend
|
|
(in
thousands)
|
|
(unaudited)
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net income
|
$
|
1,733
|
|
|
$
|
5,527
|
|
|
$
|
18,235
|
|
|
$
|
39,422
|
|
|
Provision for income
taxes
|
4,245
|
|
|
5,011
|
|
|
14,074
|
|
|
26,077
|
|
|
Interest and other
expense, net
|
2,085
|
|
|
2,619
|
|
|
3,079
|
|
|
688
|
|
|
Stock-based
compensation[1]
|
4,229
|
|
|
4,533
|
|
|
18,568
|
|
|
18,015
|
|
|
Depreciation and
amortization
|
42,311
|
|
|
38,809
|
|
|
171,623
|
|
|
145,835
|
|
|
Non-GAAP adjusted
EBITDA[5]
|
54,603
|
|
|
56,499
|
|
|
225,579
|
|
|
230,037
|
|
|
Net patent
spend
|
(45,495)
|
|
|
(50,353)
|
|
|
(117,429)
|
|
|
(160,665)
|
|
|
Non-GAAP adjusted
EBITDA less net patent spend
|
$
|
9,108
|
|
|
$
|
6,146
|
|
|
$
|
108,150
|
|
|
$
|
69,372
|
|
|
RPX
Corporation
|
|
Additional
Metrics
|
|
(in thousands,
except client and headcount data)
|
|
(unaudited)
|
|
|
As of and for the
Three
Months Ended December 31,
|
|
Operating
Metrics
|
|
2016
|
|
2015
|
|
Number of
clients[7]
|
|
348
|
|
|
255
|
|
|
Net
additions[7]
|
|
20
|
|
|
10
|
|
|
Gross patent
spend
|
|
$
|
48,495
|
|
|
$
|
137,673
|
|
|
Net patent
spend
|
|
$
|
45,495
|
|
|
$
|
50,353
|
|
|
|
|
|
|
|
|
As of and for the
Three
Months Ended December 31,
|
|
Financial
Metrics
|
|
2016
|
|
2015
|
|
Subscription
revenue[6]
|
|
$
|
62,688
|
|
|
$
|
67,701
|
|
|
Discovery
revenue
|
|
18,289
|
|
|
—
|
|
|
Fee-related
revenue
|
|
825
|
|
|
5,130
|
|
|
Total
revenue
|
|
$
|
81,802
|
|
|
$
|
72,831
|
|
|
Cash, cash
equivalents and short-term investments
|
|
$
|
190,988
|
|
|
$
|
325,998
|
|
|
Deferred revenue,
current and non-current
|
|
$
|
130,408
|
|
|
$
|
115,652
|
|
|
|
|
[1]
|
RPX excludes
stock-based compensation and related employer payroll taxes from
its non-GAAP financial measures.
|
|
[2]
|
RPX excludes
amortization expense related to intangible assets (other than
patents) acquired in conjunction with the acquisition of businesses
from its non-GAAP financial measures.
|
|
[3]
|
RPX excludes fair
value adjustments and gains on extinguishment related to its
deferred payment obligations, other-than-temporary impairments to
its short-term investments, and realized losses on exchanges of
short-term investments from its non-GAAP financial
measures.
|
|
[4]
|
Amount reflects
income taxes associated with the above noted non-GAAP
exclusions.
|
|
[5]
|
RPX calculates
non-GAAP adjusted EBITDA as GAAP earnings before other income or
expenses, net, provision for income taxes, depreciation,
amortization, and stock-based compensation expenses (inclusive of
related employer payroll taxes).
|
|
[6]
|
Subscription revenue
is comprised of revenue generated from membership subscription
services, premiums earned, net of ceding commissions, from
insurance policies, and management fees related to the Company's
insurance business.
|
|
[7]
|
Represents clients
receiving RPX's patent risk management services only; does not
include RPX's discovery services clients.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/rpx-announces-fourth-quarter-and-fiscal-2016-financial-results-300407277.html
SOURCE RPX Corporation