Go-To-Market Execution Delivers Momentum on
Subscription Transition, Increased Attach Rate of New Products, and
Continued Strength in Large Deals as the Company Approaches a
Billion Dollar Milestone in Deferred Revenue
Nutanix, Inc. (NASDAQ: NTNX), a leader in enterprise cloud
computing, today announced financial results for the first quarter
of fiscal 2020 ended October 31, 2019.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20191125005740/en/
Nutanix Q1 FY'20 Earnings Infographic
(Graphic: Nutanix, Inc.)
Q1 Fiscal 2020 Financial Highlights
- Revenue: $314.8 million, up from $313.3 million in the
first quarter of fiscal 2019, reflecting revenue compression from
the company’s ongoing transition to subscription and the
significant reduction of hardware revenue from the prior year
- Billings: $380.0 million, down from $383.6 million in
the first quarter of fiscal 2019, reflecting billings compression
from the company’s ongoing transition to subscription and the
significant reduction of hardware billings from the prior year
- Software and Support (TCV)1 Revenue: $305.0 million, up
9% year-over-year from $280.7 million in the first quarter of
fiscal 2019, reflecting revenue compression from the company’s
ongoing transition to subscription
- Software and Support (TCV) Billings: $370.3 million, up
5% year-over-year from $351.0 million in the first quarter of
fiscal 2019, reflecting billings compression from the company’s
ongoing transition to subscription
- Gross Margin: GAAP gross margin of 77.1%, up from 76.3%
in the first quarter of fiscal 2019; Non-GAAP gross margin of
80.1%, up from 78.6% in the first quarter of fiscal 2019
- Net Loss: GAAP net loss of $229.3 million, compared to a
GAAP net loss of $94.3 million in the first quarter of fiscal 2019;
Non-GAAP net loss of $135.3 million, compared to a non-GAAP net
loss of $23.7 million in the first quarter of fiscal 2019
- Net Loss Per Share: GAAP net loss per share of $1.21,
compared to a GAAP net loss per share of $0.54 in the first quarter
of fiscal 2019; Non-GAAP net loss per share of $0.71, compared to a
non-GAAP net loss per share of $0.13 in the first quarter of fiscal
2019
- Cash and Short-term Investments: $889.4 million,
compared to $965.0 million in the first quarter of fiscal 2019
- Deferred Revenue: $975.3 million, up 39% from the first
quarter of fiscal 2019
- Operating Cash Flow: Use of $26.2 million, compared to
generation of $49.8 million in the first quarter of fiscal
2019
- Free Cash Flow: Use of $44.4 million, compared to
generation of $20.0 million in the first quarter of fiscal
2019
Reconciliations between GAAP and non-GAAP financial measures and
key performance measures are provided in the tables of this press
release.
“Our solid Q1 performance, particularly in the Americas, gives
us confidence that we have the right formula for global sales
leadership as demonstrated by improved productivity and sales
hiring over the last six months,” said Dheeraj Pandey, Chairman,
Founder and CEO of Nutanix. “We have also seen momentum in key
areas of our business, including the transition to subscription and
an improved 28% attach rate of new products onto our core HCI
platform.”
“We continued to make progress towards our goal of more than 75%
of billings coming from subscription by the end of the fiscal year,
further demonstrating that customers want the freedom and
flexibility that a subscription software model offers,” said Duston
Williams, CFO of Nutanix. “Our last two quarters of solid execution
position us well to deliver on our growth plans for fiscal
2020.”
Recent Company Highlights
- Continued Shift to Subscription Recurring Revenue Model:
First quarter fiscal 2020 subscription billings grew 41%
year-over-year to $276 million, representing 73% of total billings,
and subscription revenue increased 72% year-over-year to $218
million, representing 69% of total revenue.
- Expanded Customer Base and Closed Record Number of $1M+
Deals: Nutanix ended the first quarter with 14,960 total
customers and closed a record high of 66 deals worth more than $1
million. First quarter customer wins included Anheuser-Busch InBev,
Akron Children’s Hospital, Banco Patagonia S.A., Huaxia Bank, and
The College of Education and Human Ecology at Ohio State
University.
- Grew Adoption of New Products: Nutanix saw continued new
product traction with 28%2 of deals including at least one product
outside of the company’s core offering.
- Added Two New Executives in Key Functions: Tarkan Maner
joined Nutanix as Chief Commercial Officer and is responsible for
Nutanix’s global business development strategy, with a focus on
partnerships, alliances, system integrators, and service providers.
He will lead critical hybrid cloud-focused product teams including
Nutanix Clusters, End-User Computing, Networking and Cloud
Services, and Era. In addition, Christian Alvarez joined as the VP
of Americas Channel to oversee building and managing the Nutanix
Americas Channel team.
- Hosted Ninth .NEXT User Conference: Nearly 4,500
attendees, including customers, prospects and partners, joined
Nutanix in Copenhagen for its ninth .NEXT Conference, where
attendees heard about Nutanix’s vision for the hybrid cloud. The
venue was also the location for the largest EMEA Partner Xchange to
date, with 1,200 Nutanix channel attendees.
- Announced New IT Automation for Private Clouds: Nutanix
and ServiceNow announced integration of Nutanix’s HCI platform and
ServiceNow’s IT Operations Management solution to automate critical
private cloud workflows. This solution enables IT teams to spend
less time servicing incidents and issues and instead focus on
offering a public cloud-like experience within the data center,
competitive differentiation, and strategic planning in their
digital transformation journey.
- Announced General Availability of HPE GreenLake for
Nutanix: The HPE GreenLake solution leverages Nutanix’s
Enterprise Cloud OS software, including its built-in AHV
hypervisor, to deliver a fully HPE-managed private cloud. It
dramatically lowers total cost of ownership and accelerates time to
value, allowing customers to pay for the service based on actual
consumption.
- Launched “All Together Now” Campaign to Expand Brand Reach
into Market: The company introduced a new global brand campaign
that simplifies and amplifies Nutanix’s vision for the hybrid and
multi-cloud focusing on the simplicity, choice, and delight Nutanix
brings to customers.
- Released Results of Second Annual Enterprise Cloud
Index: Nutanix engaged a third-party research firm to conduct a
global survey of 2,650 IT leaders in mid-2019. A substantial
majority (85%) of those respondents reaffirmed that hybrid cloud is
the ideal IT model to strive for, and the majority have plans to
aggressively shift investment to hybrid cloud architectures over
the next three to five years. The research also found that the
flexibility afforded by hybrid clouds to match and move
applications to the right infrastructure in order to optimize cost,
performance, security, and other variables as needed was what
respondents value most about the hybrid model.
- Named a Great Company for Millennials in the Bay Area:
Nutanix was named one of the 18 great companies for millennials to
work for in the San Francisco Bay Area by Comparably, a career data
website. The rating was based on what millennials say they find
most important in a job, including flexibility, benefits that match
their values, social impact, and an opportunity to feel like valued
contributors rather than just a number at work.
- Named to the 50 Companies to Watch in 2020 List: This
list of 50 companies worth watching was developed by analysts at
Bloomberg Intelligence. When curating the list, they considered
revenue growth, margins, market share, debt, and other factors such
as economic conditions.
Q2 and Fiscal 2020 Financial Outlook
For the second quarter of fiscal 2020, Nutanix expects:
- Software and support (TCV) billings between $410 million and
$420 million;
- Software and support (TCV) revenue between $330 million and
$335 million;
- Non-GAAP gross margin of approximately 80%;
- Non-GAAP operating expenses between $400 million and $410
million; and
- Non-GAAP net loss per share of approximately $0.70, using
approximately 193 million weighted shares outstanding.
For the full year of fiscal 2020, Nutanix expects:
- Software and support (TCV) billings between $1.65 billion and
$1.75 billion;
- Software and support (TCV) revenue between $1.30 billion and
$1.40 billion;
- Non-GAAP gross margin of approximately 80%; and
- Non-GAAP operating expenses between $1.65 billion and $1.70
billion.
Supplementary materials to this earnings release, including the
company’s first quarter fiscal 2020 investor presentation, can be
found at https://ir.nutanix.com/company/financial.
All forward-looking non-GAAP financial measures contained in the
section titled "Q2 and Fiscal 2020 Financial Outlook" exclude
stock-based compensation expense and amortization of intangible
assets and may also exclude, as applicable, other special items.
The company has not reconciled guidance for software and support
(TCV) billings, non-GAAP gross margin, non-GAAP operating expenses
and non-GAAP net loss per share to their most directly comparable
GAAP measures because such items that impact these measures are not
within its control and are subject to constant change. While the
actual amounts of such items will have a significant impact on the
company’s software and support (TCV) billings, non-GAAP gross
margin, non-GAAP operating expenses and non-GAAP net loss per
share, a reconciliation of the non-GAAP financial measure guidance
to the corresponding GAAP measures is not available without
unreasonable effort.
1TCV, or Total Contract Value, for any given period is defined
as the total software and support revenue or total software and
support billings, as applicable, during such period, which excludes
revenue and billings associated with pass-through hardware sales
during the period.
2Based on a rolling four-quarter average.
Webcast and Conference Call Information
Nutanix executives will discuss the company’s first quarter
fiscal 2020 financial results on a conference call at 4:30 p.m.
Eastern Time/1:30 p.m. Pacific Time today. To listen to the call
via telephone, dial 1-833-227-5841 in the United States or
1-647-689-4068 from outside the United States. The conference ID is
7999572. This call will be webcast live and available to all
interested parties on our Investor Relations website at
ir.nutanix.com. Shortly after the conclusion of the conference
call, a replay of the audio webcast will be available on the
Nutanix Investor Relations website. A telephonic replay will be
available for one week by calling 1-800-585-8367 or 1-416-621-4642,
and entering the conference ID 7999572.
Non-GAAP Financial Measures and Other Key Performance
Measures
To supplement our consolidated financial statements, which are
prepared and presented in accordance with GAAP, we use the
following non-GAAP financial and other key performance measures:
billings, non-GAAP gross margin, non-GAAP operating expenses,
non-GAAP net loss, non-GAAP net loss per share, free cash flow,
software and support revenue (or TCV revenue), subscription
revenue, software and support billings (or TCV billings),
subscription billings, and professional services billings. In
computing these non-GAAP financial measures and key performance
measures, we exclude certain items such as stock-based compensation
and the related income tax impact, costs associated with our
acquisitions (such as amortization of acquired intangible assets,
revaluation of contingent consideration, income tax-related impact,
and other acquisition-related costs), amortization of debt discount
and issuance costs, other non-recurring transactions and the
related tax impact, and the revenue and billings associated with
pass-through hardware sales. Billings is a performance measure
which we believe provides useful information to investors because
it represents the amounts under binding purchase orders received by
us during a given period that have been billed, and we calculate
billings by adding the change in deferred revenue between the start
and end of the period to total revenue recognized in the same
period. Free cash flow is a performance measure that we believe
provides useful information to our management and investors about
the amount of cash generated by the business after necessary
capital expenditures, and we define free cash flow as net cash
(used in) provided by operating activities less purchases of
property and equipment. Non-GAAP gross margin, non-GAAP operating
expenses, non-GAAP net loss, and non-GAAP net loss per share are
financial measures which we believe provide useful information to
investors because they provide meaningful supplemental information
regarding our performance and liquidity by excluding certain
expenses and expenditures such as stock-based compensation expense
that may not be indicative of our ongoing core business operating
results. Software and support revenue (or TCV revenue) and software
and support billings (or TCV billings) are performance measures
that we believe provide useful information to our management and
investors as they allow us to better track the true growth of our
software business by excluding the amounts attributable to the
pass-through hardware sales that we use to deliver our solutions.
Subscription revenue, subscription billings, and professional
services billings are performance measures that we believe provide
useful information to our management and investors as they allow us
to better track the growth of the subscription-based portion of our
business, which is a critical part of our business plan. We use
these non-GAAP financial and key performance measures for financial
and operational decision-making and as a means to evaluate
period-to-period comparisons. However, these non-GAAP financial and
key performance measures have limitations as analytical tools and
you should not consider them in isolation or as substitutes for
analysis of our results as reported under GAAP. Billings, non-GAAP
gross margin, non-GAAP operating expenses, non-GAAP net loss,
non-GAAP net loss per share, and free cash flow are not substitutes
for total revenue, gross margin, operating expenses, net loss, net
loss per share, or net cash (used in) provided by operating
activities, respectively; subscription revenue, software and
support revenue (or TCV revenue) and software and support billings
(or TCV billings) are not substitutes for total revenue; and
subscription and professional services billings are not a
substitute for subscription and professional services revenue. In
addition, other companies, including companies in our industry, may
calculate non-GAAP financial measures and key performance measures
differently or may use other measures to evaluate their
performance, all of which could reduce the usefulness of our
non-GAAP financial measures and key performance measures as tools
for comparison. We urge you to review the reconciliation of our
non-GAAP financial measures and key performance measures to the
most directly comparable GAAP financial measures included below in
the tables captioned “Reconciliation of Revenue to Billings,”
“Disaggregation of Revenue and Billings,” “Reconciliation of
Subscription and Professional Services Revenue to Subscription and
Professional Services Billings,” “Reconciliation of Software and
Support Revenue (TCV Revenue) to Software and Support Billings (TCV
Billings),” “Reconciliation of GAAP to Non-GAAP Profit Measures,”
and “Reconciliation of GAAP Net Cash Provided By Operating
Activities to Non-GAAP Free Cash Flow,” and not to rely on any
single financial measure to evaluate our business.
Forward-Looking Statements
This press release contains express and implied forward-looking
statements, including, but not limited to, statements regarding our
business plans, initiatives and objectives, our ability to execute
such plans, initiatives and objectives in a timely manner, and the
benefits and impact of such plans, initiatives and objectives, the
benefits and capabilities of our platform, products, services and
technology, our plans and expectations regarding new products,
services, product features and technology that are under
development or in process, our continued investments in talent,
technology, and marketing, and the success and impact of such
investments, including the ability of our senior management and
global sales leadership to successfully execute on our future
business plans and objectives, our plans and timing for, and the
success and impact of, our transition to a subscription-based and
recurring revenue business model, projected changes to our
subscription billings mix, any impact of the actions we have
undertaken to strengthen lead and pipeline generation and enhance
sales execution, our focus on customer needs, and anticipated
future financial results, including but not limited to our guidance
on estimated software and support revenue (or TCV revenue),
software and support billings (or TCV billings), non-GAAP gross
margin, non-GAAP operating expenses and non-GAAP net loss per share
for various future fiscal periods. These forward-looking statements
are not historical facts and instead are based on our current
expectations, estimates, opinions, and beliefs. Consequently, you
should not rely on these forward-looking statements. The accuracy
of such forward-looking statements depends upon future events and
involves risks, uncertainties, and other factors beyond our control
that may cause these statements to be inaccurate and cause our
actual results, performance or achievements to differ materially
and adversely from those anticipated or implied by such statements,
including, among others: failure to successfully implement or
realize the full benefits of, or unexpected difficulties or delays
in successfully implementing or realizing the full benefits of, our
business plans, initiatives and objectives; failure to develop, or
unexpected difficulties or delays in developing, new products,
services, product features or technology in a timely or
cost-effective basis; delays in or lack of customer or market
acceptance of our new products, services, product features or
technology; delays in the transition to a subscription-based and
recurring revenue business model; failure of or delay in the
actions we have undertaken to strengthen lead and pipeline
generation and enhance sales execution; the rapid evolution of the
markets in which we compete; our ability to sustain or manage
future growth effectively; factors that could result in the
significant fluctuation of our future quarterly operating results,
including, among other things, anticipated changes to our revenue
and product mix, including changes as a result of our transition to
a subscription-based business model, which will slow revenue growth
during such transition and make forecasting future performance more
difficult, the timing and magnitude of orders, shipments and
acceptance of our solutions in any given quarter, our ability to
attract new and retain existing end-customers, changes in the
pricing of certain components of our solutions, and fluctuations in
demand and competitive pricing pressures for our solutions; the
introduction, or acceleration of adoption of, competing solutions,
including public cloud infrastructure; and other risks detailed in
our Annual Report on Form 10-K for the fiscal year ended July 31,
2019, filed with the U.S. Securities and Exchange Commission, or
the SEC, on September 24, 2019. Additional information will also be
set forth in our Quarterly Report on Form 10-Q that will be filed
for the fiscal quarter ended October 31, 2019, which should be read
in conjunction with this press release and the financial results
included herein. Our SEC filings are available on the Investor
Relations section of the company’s website at ir.nutanix.com and on
the SEC's website at www.sec.gov. These forward-looking statements
speak only as of the date of this press release and, except as
required by law, we assume no obligation, and expressly disclaim
any obligation, to update, alter or otherwise revise any of these
forward-looking statements to reflect actual results or subsequent
events or circumstances.
About Nutanix
Nutanix is a global leader in cloud software and hyperconverged
infrastructure solutions, making infrastructure invisible so that
IT can focus on the applications and services that power their
business. Companies around the world use Nutanix Enterprise Cloud
OS software to bring one-click application management and mobility
across public, private and distributed edge clouds so they can run
any application at any scale with a dramatically lower total cost
of ownership. The result is organizations that can rapidly deliver
a high-performance IT environment on demand, giving application
owners a true cloud-like experience. Learn more at www.nutanix.com
or follow us on Twitter @nutanix.
© 2019 Nutanix, Inc. All rights reserved. Nutanix, the Nutanix
logo, and all Nutanix product and service names mentioned herein
are registered trademarks or trademarks of Nutanix, Inc. in the
United States and other countries. All other brand names mentioned
herein are for identification purposes only and may be the
trademarks of their respective holder(s). This press release
contains links to external websites that are not part of
Nutanix.com. Nutanix does not control these sites and disclaims all
responsibility for the content or accuracy of any external site.
Our decision to link to an external site should not be considered
an endorsement of any content on such a site.
NUTANIX, INC. CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
As of
July 31, 2019
October 31, 2019
(in thousands)
Assets
Current assets:
Cash and cash equivalents
$
396,678
$
233,820
Short-term investments
512,156
655,584
Accounts receivable, net
245,475
214,883
Deferred commissions—current
46,238
51,966
Prepaid expenses and other current
assets
74,665
61,654
Total current assets
1,275,212
1,217,907
Property and equipment, net
136,962
140,470
Operating lease right-of-use assets
—
123,002
Deferred commissions—non-current
107,474
120,059
Intangible assets, net
66,773
62,428
Goodwill
185,180
185,260
Other assets—non-current
14,441
17,260
Total assets
$
1,786,042
$
1,866,386
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
74,047
$
83,381
Accrued compensation and benefits
99,804
95,018
Accrued expenses and other current
liabilities
28,797
17,434
Deferred revenue—current
396,667
429,429
Operating lease liabilities—current
—
29,968
Total current liabilities
599,315
655,230
Deferred revenue—non-current
513,377
545,845
Operating lease
liabilities—non-current
—
118,410
Convertible senior notes, net
458,910
466,545
Other liabilities—non-current
27,547
16,827
Total liabilities
1,599,149
1,802,857
Stockholders’ equity:
Common stock
5
5
Additional paid-in capital
1,835,528
1,940,899
Accumulated other comprehensive income
669
1,234
Accumulated deficit
(1,649,309
)
(1,878,609
)
Total stockholders’ equity
186,893
63,529
Total liabilities and stockholders’
equity
$
1,786,042
$
1,866,386
NUTANIX, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands, except per
share data)
Revenue:
Product
$
224,346
$
192,444
Support, entitlements and other
services
88,937
122,324
Total revenue
313,283
314,768
Cost of revenue:
Product (1)(2)
39,261
21,233
Support, entitlements and other services
(1)
34,845
50,968
Total cost of revenue
74,106
72,201
Gross profit
239,177
242,567
Operating expenses:
Sales and marketing (1)(2)
196,497
291,838
Research and development (1)
110,531
138,206
General and administrative (1)
27,339
32,860
Total operating expenses
334,367
462,904
Loss from operations
(95,190
)
(220,337
)
Other expense, net
(2,703
)
(5,040
)
Loss before (benefit from) provision for
income taxes
(97,893
)
(225,377
)
(Benefit from) provision for income
taxes
(3,628
)
3,923
Net loss
$
(94,265
)
$
(229,300
)
Net loss per share attributable to Class A
and Class B common stockholders—basic and diluted
$
(0.54
)
$
(1.21
)
Weighted average shares used in computing
net loss per share attributable to Class A and Class B common
stockholders—basic and diluted
175,446
189,671
(1)
Includes the following stock-based compensation expense:
Three Months Ended October
31,
2018
2019
(in thousands)
Product cost of revenue
$
698
$
1,112
Support, entitlements and other services
cost of revenue
3,157
4,751
Sales and marketing
22,606
27,775
Research and development
31,009
37,563
General and administrative
8,455
10,225
Total stock-based compensation expense
$
65,925
$
81,426
(2) Includes the following amortization of intangible
assets:
Three Months Ended October
31,
2018
2019
(in thousands)
Product cost of sales
$
3,168
$
3,694
Sales and marketing
550
651
Total amortization of intangible
assets
$
3,718
$
4,345
NUTANIX, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Cash flows from operating
activities:
Net loss
$
(94,265
)
$
(229,300
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization
16,183
22,462
Stock-based compensation
65,925
81,426
Amortization of debt discount and debt
issuance costs
7,148
7,635
Operating lease cost, net of accretion
—
6,671
Change in fair value of contingent
consideration
(799
)
—
Other
(759
)
103
Changes in operating assets and
liabilities:
Accounts receivable, net
23,497
30,592
Deferred commissions
(7,728
)
(18,313
)
Prepaid expenses and other assets
(3,812
)
16,150
Accounts payable
1,292
5,208
Accrued compensation and benefits
(19,689
)
(4,786
)
Accrued expenses and other liabilities
(7,442
)
(5,772
)
Operating leases, net
—
(3,469
)
Deferred revenue
70,273
65,230
Net cash provided by (used in) operating
activities
49,824
(26,163
)
Cash flows from investing
activities:
Maturities of investments
143,409
171,441
Purchases of investments
(79,766
)
(321,474
)
Sales of investments
—
7,870
Purchases of property and equipment
(29,832
)
(18,203
)
Payments for acquisitions, net of cash and
restricted cash acquired
(18,662
)
—
Net cash provided by (used in) investing
activities
15,149
(160,366
)
Cash flows from financing
activities:
Proceeds from sales of shares through
employee equity incentive plans, net of repurchases
29,890
23,973
Payment of debt in conjunction with
business combinations
(991
)
—
Proceeds from issuance of convertible
senior notes, net
(75
)
—
Net cash provided by financing
activities
28,824
23,973
Net increase (decrease) in cash, cash
equivalents and restricted cash
$
93,797
$
(162,556
)
Cash, cash equivalents and restricted
cash—beginning of period
307,098
399,520
Cash, cash equivalents and restricted
cash—end of period
$
400,895
$
236,964
Restricted cash (1)
1,109
3,144
Cash and cash equivalents—end of
period
$
399,786
$
233,820
Supplemental disclosures of cash flow
information:
Cash paid for income taxes
$
3,910
$
7,779
Supplemental disclosures of non-cash
investing and financing information:
Issuance of common stock for
acquisitions
$
102,978
$
—
Purchases of property and equipment
included in accounts payable and accrued liabilities
$
15,717
$
12,200
Vesting of early exercised stock
options
$
70
$
—
(1)
Included within other assets—non-current
in the condensed consolidated balance sheets.
Reconciliation of Revenue to Billings(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Total revenue
$
313,283
$
314,768
Change in deferred revenue, net of
acquisitions (1)
70,273
65,230
Total billings
$
383,556
$
379,998
(1)
Amount for the three months ended
October 31, 2018 excludes approximately $0.3 million of deferred
revenue assumed in an acquisition.
Disaggregation of Revenue and Billings(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Disaggregation of Revenue:
Subscription
$
126,976
$
217,896
Non-portable software
146,570
77,571
Hardware
32,547
9,724
Professional services
7,190
9,577
Total revenue
$
313,283
$
314,768
Disaggregation of Billings:
Subscription
$
194,764
$
275,538
Non-portable software
146,570
77,571
Hardware
32,547
9,724
Professional services
9,675
17,165
Total billings
$
383,556
$
379,998
Subscription — Subscription revenue includes any performance
obligation which has a defined term, and is generated from the
sales of software entitlement and support subscriptions,
subscription software licenses and cloud-based Software as a
Service, or SaaS offerings.
- Ratable — We recognize revenue from software entitlement and
support subscriptions and SaaS offerings ratably over the
contractual service period, the substantial majority of which
relate to software entitlement and support subscriptions.
- Upfront — Revenue from our subscription software licenses is
generally recognized upfront upon transfer of control to the
customer, which happens when we make the software available to the
customer.
Non-portable software — Non-portable software revenue includes
sales of our enterprise cloud platform when delivered on a
configured-to-order appliance by us or one of our OEM partners. The
software licenses associated with these sales are typically
non-portable and have a term equal to the life of the appliance on
which the software is delivered. Revenue from our non-portable
software products is generally recognized upon transfer of control
to the customer.
Hardware — In transactions where we deliver the hardware
appliance, we consider ourselves to be the principal in the
transaction and we record revenue and costs of goods sold on a
gross basis. We consider the amount allocated to hardware revenue
to be equivalent to the cost of the hardware procured. Hardware
revenue is generally recognized upon transfer of control to the
customer.
Professional services — We also sell professional services with
our products. We recognize revenue related to professional services
as they are performed.
Reconciliation of Subscription
and Professional Services Revenue to Subscription and Professional
Services Billings
(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Subscription revenue
$
126,976
$
217,896
Change in subscription deferred revenue,
net of acquisitions (1)
67,788
57,642
Subscription billings
$
194,764
$
275,538
Professional services revenue
$
7,190
$
9,577
Change in professional services deferred
revenue
2,485
7,588
Professional services billings
$
9,675
$
17,165
(1)
Amount for the three months ended
October 31, 2018 excludes approximately $0.3 million of deferred
revenue assumed in an acquisition.
Reconciliation of Software and Support Revenue (TCV Revenue) to
Software and Support Billings (TCV Billings)(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Software revenue
$
191,799
$
182,720
Hardware revenue
32,547
9,724
Product revenue
224,346
192,444
Support, entitlements and other services
revenue
88,937
122,324
Total revenue
$
313,283
$
314,768
Software and support revenue (TCV revenue)
(2)
$
280,736
$
305,044
Change in software and support deferred
revenue (TCV deferred revenue), net of acquisitions (1)
70,273
65,230
Software and support billings (TCV
billings) (2)
$
351,009
$
370,274
(1)
Amount for the three months ended
October 31, 2018 excludes approximately $0.3 million of deferred
revenue assumed in an acquisition.
(2)
Software and support revenue and
billings (TCV revenue and billings) include software and support,
entitlements and other services revenue and billings.
Reconciliation of GAAP to Non-GAAP Profit
Measures(Unaudited)
GAAP
Non-GAAP Adjustments
Non-GAAP
Three Months Ended October 31,
2019
(1)
(2)
(3)
(4)
(5)
Three Months Ended October 31,
2019
(in thousands, except
percentages and per share data)
Gross profit
$
242,567
$
5,863
$
3,694
$
—
$
—
$
—
$
252,124
Gross margin
77.1
%
1.8
%
1.2
%
—
—
—
80.1
%
Operating expenses:
Sales and marketing
291,838
(27,775
)
(651
)
—
—
—
263,412
Research and development
138,206
(37,563
)
—
—
—
—
100,643
General and administrative
32,860
(10,225
)
—
(353
)
—
—
22,282
Total operating expenses
462,904
(75,563
)
(651
)
(353
)
—
—
386,337
Loss from operations
(220,337
)
81,426
4,345
353
—
—
(134,213
)
Net loss
$
(229,300
)
$
81,426
$
4,345
$
353
$
7,635
$
213
$
(135,328
)
Weighted shares outstanding, basic and
diluted
189,671
189,671
Net loss per share, basic and diluted
$
(1.21
)
$
0.43
$
0.03
$
—
$
0.04
$
—
$
(0.71
)
(1)
Stock-based compensation
(2)
Amortization of intangible
assets
(3)
Other
(4)
Amortization of debt discount and
issuance costs
(5)
Income tax effect primarily
related to stock-based compensation expense
GAAP
Non-GAAP Adjustments
Non-GAAP
Three Months Ended October 31,
2018
(1)
(2)
(3)
(4)
(5)
(6)
Three Months Ended October 31,
2018
(in thousands, except
percentages and per share data)
Gross profit
$
239,177
$
3,855
$
3,168
$
—
$
—
$
—
$
—
$
246,200
Gross margin
76.3
%
1.2
%
1.1
%
—
—
—
—
78.6
%
Operating expenses:
Sales and marketing
196,497
(22,606
)
(550
)
—
—
—
—
173,341
Research and development
110,531
(31,009
)
—
—
—
—
—
79,522
General and administrative
27,339
(8,455
)
—
799
(481
)
—
—
19,202
Total operating expenses
334,367
(62,070
)
(550
)
799
(481
)
—
—
272,065
Loss from operations
(95,190
)
65,925
3,718
(799
)
481
—
—
(25,865
)
Net loss
$
(94,265
)
$
65,925
$
3,718
$
(799
)
$
481
$
7,148
$
(5,860
)
$
(23,652
)
Weighted shares outstanding, basic and
diluted
175,446
175,446
Net loss per share, basic and diluted
$
(0.54
)
$
0.38
$
0.02
$
—
$
—
$
0.04
$
(0.03
)
$
(0.13
)
(1)
Stock-based compensation
(2)
Amortization of intangible
assets
(3)
Change in fair value of
contingent consideration assumed in an acquisition
(4)
Acquisition-related costs
(5)
Amortization of debt discount and
debt issuance costs
(6)
Income tax effect primarily
related to partial release of valuation allowance resulting from an
acquisition
Reconciliation of GAAP Net Cash Provided by Operating Activities
to Non-GAAP Free Cash Flow
(Unaudited)
Three Months Ended October
31,
2018
2019
(in thousands)
Net cash provided by (used in) operating
activities
$
49,824
$
(26,163
)
Purchases of property and equipment
(29,832
)
(18,203
)
Free cash flow
$
19,992
$
(44,366
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191125005740/en/
Investor Contact: Tonya Chin 408-560-2675
tonya@nutanix.com
Media Contact: Jennifer Massaro 408-309-6886
jennifer.massaro@nutanix.com
Nutanix (NASDAQ:NTNX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Nutanix (NASDAQ:NTNX)
Historical Stock Chart
From Apr 2023 to Apr 2024