MicroStrategy® Incorporated (Nasdaq: MSTR), a leading worldwide
provider of enterprise analytics and mobility software, today
announced financial results for the three-month period ended
March 31, 2019 (the first quarter of its 2019 fiscal
year).
MicroStrategy adopted Accounting Standards Update No. 2016-02,
Leases (Topic 842), and its subsequent amendments (“ASU 2016-02”),
effective January 1, 2019. Comparative prior period consolidated
financial statements have not been restated and are not directly
comparable to the current period consolidated financial
statements.
First quarter 2019 revenues were $115.4 million versus $123.0
million for the first quarter of 2018, a 6.2% decrease. Product
licenses and subscription services revenues for the first quarter
of 2019 were $25.4 million versus $25.0 million for the first
quarter of 2018, a 1.9% increase. Product support revenues for the
first quarter of 2019 were $71.5 million versus $74.4 million for
the first quarter of 2018, a 4.0% decrease. Other services revenues
for the first quarter of 2019 were $18.5 million versus $23.6
million for the first quarter of 2018, a 21.7% decrease. Foreign
currency effects had an unfavorable impact on revenues for the
first quarter of 2019.
Operating expenses for the first quarter of 2019 were $99.6
million versus $97.1 million for the first quarter of 2018, a 2.6%
increase.
Loss from operations for the first quarter of 2019 was $10.4
million versus income from operations of $0.7 million for the first
quarter of 2018. Net loss for the first quarter of 2019 was $7.9
million, or $0.77 per share on a diluted basis, as compared to net
income of $1.7 million, or $0.15 per share on a diluted basis, for
the first quarter of 2018.
Non-GAAP loss from operations, which excludes share-based
compensation expense, was $7.4 million for the first quarter of
2019 versus non-GAAP income from operations of $5.5 million for the
first quarter of 2018. The tables at the end of this press release
include a reconciliation of (loss) income from operations to
non-GAAP (loss) income from operations for the three months ended
March 31, 2019 and 2018. An explanation of this non-GAAP
financial measure is also included under the heading “Non-GAAP
Financial Measure” below.
As of March 31, 2019, MicroStrategy had cash and cash
equivalents and short-term investments of $551.1 million, as
compared to $576.1 million as of December 31, 2018, a decrease
of $25.1 million. During the first quarter of 2019, MicroStrategy
repurchased 362,148 shares of its class A common stock for an
aggregate purchase price of approximately $48.2 million. As of
March 31, 2019, MicroStrategy had 8.2 million shares of class
A common stock and 2.0 million shares of class B common stock
outstanding.
MicroStrategy uses its Intelligent Enterprise™ platform across
the enterprise and has created an interactive dossier with
quarterly financial performance data. Anyone can access the MSTR
Financials dossier via a web browser, or by downloading the
MicroStrategy Library™ app on an iOS or Android device. To download
the native apps, visit MicroStrategy Library for iPad,
MicroStrategy Library for iPhone, or MicroStrategy Library for
Android tablet and smartphone.
Conference Call
MicroStrategy will be discussing its first quarter 2019
financial results on a conference call today beginning at
approximately 5:00 p.m. EDT. To access the conference call, dial
(844) 824-7425 (domestically) or (716) 220-9429 (internationally)
and use conference ID 7634017. A live and archived webcast will be
available under the “Events” section on MicroStrategy’s investor
relations website at http://ir.microstrategy.com/events.cfm. A
replay of the conference call will be available beginning
approximately two hours after the call concludes until May 7, 2019
at (855) 859-2056 (domestically) or (404) 537-3406
(internationally) using the passcode 7634017.
Recent Business Highlights
- MicroStrategy announced the general
availability of MicroStrategy 2019™, the industry’s first
and only enterprise platform for Federated Analytics,
Transformational Mobility, and HyperIntelligence™. MicroStrategy
2019 delivers modern analytics on an enterprise platform that can
be deployed on-premises or on multiple private and public cloud
platforms. MicroStrategy customers on MicroStrategy 2019
platform can get started on HyperIntelligence by downloading the
MicroStrategy HyperIntelligence extension at the Chrome Web
Store. Customers can provision MicroStrategy 2019 in the
cloud with the MicroStrategy for AWS
and MicroStrategy for Azure provisioning consoles. A
30-day free trial is available for MicroStrategy 2019 on AWS and
Microsoft Azure.
- MicroStrategy was recognized by
industry analysts in the following published research:
- Recognized by Gartner, Inc. as the sole
Challenger in the “2019 Magic Quadrant for Analytics and Business
Intelligence Platforms” (1)
- Named a Technology Innovation Leader by
Dresner Advisory Services for the second consecutive year
- Ranked the #1 Overall Value Index
Leader in Embedded Analytics and Business Intelligence by Ventana
Research
- Ranked the #1 Overall Value Index
Leader in Mobile Analytics and Business Intelligence by Ventana
Research
- MicroStrategy held its 22nd annual user
conference, MicroStrategy World™ 2019, which brought together
thousands of product experts, thought leaders and MicroStrategy
users for three days of inspirational keynotes, educational
workshops, and customer presentations on how analytics can
transform the way people use information to make each organization
a more Intelligent Enterprise. Attendees also learned about
MicroStrategy’s new platform, robust partner network, and services
offerings as well as how they can employ new digital strategies to
increase the adoption of analytics across the enterprise.
- MicroStrategy announced the ability of
customers to leverage MicroStrategy 2019 on Microsoft Azure and
Amazon Web Services, which allows customers to launch
fully-configured analytics, mobility, and HyperIntelligence
projects on Azure and AWS.
- MicroStrategy presented Customer Awards
to American Express Global Business Travel, The Coca-Cola Company,
Hilton, Ola, and TAP Air Portugal for their outstanding enterprise
analytics and mobility applications.
- MicroStrategy hosted its second annual
Datathon at MicroStrategy World 2019, challenging participants to
create innovative analytics, AI, big data, or mobile applications
using MicroStrategy 2019 with aggregated data from CharityBase, a
free, open source charity data portal with public information on
the activities, locations, and finances of thousands of charities
registered in England and Wales.
Non-GAAP Financial Measure
MicroStrategy is providing a supplemental financial measure for
(loss) income from operations that excludes the impact of
share-based compensation arrangements. This supplemental financial
measure is not a measurement of financial performance under
generally accepted accounting principles in the United States
(“GAAP”) and, as a result, this supplemental financial measure may
not be comparable to similarly titled measures of other companies.
Management uses this non-GAAP financial measure internally to help
understand, manage, and evaluate business performance and to help
make operating decisions. MicroStrategy believes that this non-GAAP
financial measure is also useful to investors and analysts in
comparing its performance across reporting periods on a consistent
basis because it excludes a significant non-cash expense that
MicroStrategy believes is not reflective of its general business
performance. In addition, accounting for share-based compensation
arrangements requires significant management judgment and the
resulting expense could vary significantly in comparison to other
companies. Therefore, MicroStrategy believes the use of this
non-GAAP financial measure can also facilitate comparison of
MicroStrategy’s operating results to those of its competitors.
About MicroStrategy Incorporated
MicroStrategy (Nasdaq: MSTR) is a leading worldwide provider of
enterprise analytics and mobility software and services. Our
mission is to make every enterprise a more Intelligent Enterprise.
MicroStrategy 2019 delivers modern analytics on an open,
comprehensive enterprise platform designed to drive business
results with Federated Analytics, Transformational Mobility, and
HyperIntelligence. To learn more, visit MicroStrategy online, and
follow us on LinkedIn, Twitter and Facebook.
MicroStrategy, Intelligent Enterprise, MicroStrategy Library,
MicroStrategy 2019, HyperIntelligence, and MicroStrategy World are
either trademarks or registered trademarks of MicroStrategy
Incorporated in the United States and certain other countries.
Other product and company names mentioned herein may be the
trademarks of their respective owners.
This press release may include statements that may constitute
“forward-looking statements,” including estimates of future
business prospects or financial results and statements containing
the words “believe,” “estimate,” “project,” “expect” or similar
expressions. Forward-looking statements inherently involve risks
and uncertainties that could cause actual results of MicroStrategy
Incorporated and its subsidiaries (collectively, the “Company”) to
differ materially from the forward-looking statements. Factors that
could contribute to such differences include: the extent and timing
of market acceptance of MicroStrategy’s new offerings, including
MicroStrategy 2019; the Company’s ability to recognize revenue or
deferred revenue through delivery of products or satisfactory
performance of services; continued acceptance of the Company’s
other products in the marketplace; fluctuations in tax benefits or
provisions, including as a result of changes to U.S. federal tax
laws; the timing of significant orders; delays in or the inability
of the Company to develop or ship new products; competitive
factors; general economic conditions; currency fluctuations; and
other risks detailed in the Company’s registration statements and
periodic reports filed with the Securities and Exchange Commission.
The Company undertakes no obligation to update these
forward-looking statements for revisions or changes after the date
of this release.
MSTR-F
(1) Gartner, Magic Quadrant for Analytics and Business
Intelligence Platforms, Cindi Howson, James Richardson, Rita
Sallam, Austin Kronz, 11 February 2019. Gartner does not endorse
any vendor, product or service depicted in its research
publications, and does not advise technology users to select only
those vendors with the highest ratings or other designation.
Gartner research publications consist of the opinions of Gartner’s
research organization and should not be construed as statements of
fact. Gartner disclaims all warranties, express or implied, with
respect to this research, including any warranties of
merchantability or fitness for a particular purpose.
MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS
OF OPERATIONS (in thousands, except per share data)
Three Months Ended March 31,
2019 2018 (unaudited) (unaudited)
Revenues Product licenses $ 18,291 $ 17,301 Subscription
services 7,144 7,662 Total product licenses and
subscription services 25,435 24,963 Product support 71,450 74,415
Other services 18,481 23,589
Total revenues
115,366 122,967 Cost of
revenues Product licenses 519 2,211 Subscription services
3,598 3,249 Total product licenses and subscription
services 4,117 5,460 Product support 7,067 4,796 Other services
14,989 14,929
Total cost of revenues
26,173 25,185 Gross profit
89,193 97,782 Operating
expenses Sales and marketing 48,760 51,335 Research and
development 28,215 23,560 General and administrative 22,604
22,172
Total operating expenses 99,579
97,067 (Loss) income from operations
(10,386 ) 715 Interest income, net 2,566 2,034
Other expense, net (596 ) (1,594 )
(Loss) income
before income taxes (8,416 ) 1,155 Benefit
from income taxes (510 ) (518 )
Net (loss)
income $ (7,906 ) $ 1,673
Basic (loss) earnings per share (1): $
(0.77 ) $ 0.15 Weighted average shares
outstanding used in computing basic (loss) earnings per share
10,328 11,447 Diluted (loss)
earnings per share (1): $ (0.77 ) $
0.15 Weighted average shares outstanding used in computing
diluted (loss) earnings per share
10,328
11,488 (1) Basic and fully diluted (loss)
earnings per share for class A and class B common stock are the
same.
MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS (in thousands, except per
share data) March 31,
December 31, 2019 2018* (unaudited)
Assets Current assets Cash and cash equivalents $ 258,743 $
109,924 Restricted cash 922 862 Short-term investments 292,314
466,186 Accounts receivable, net 133,922 171,359 Prepaid expenses
and other current assets 32,511 30,068 Total current
assets 718,412 778,399 Property and equipment, net 54,832
51,919 Right-of-use assets 87,743
0
Deposits and other assets 8,374 8,134 Deferred tax assets, net
18,983 17,316
Total Assets $
888,344 $ 855,768 Liabilities and
Stockholders' Equity Current liabilities Accounts payable,
accrued expenses, and operating lease liabilities $ 37,227 $ 33,684
Accrued compensation and employee benefits 36,713 48,045 Deferred
revenue and advance payments 190,070 176,540 Total
current liabilities 264,010 258,269 Deferred revenue and
advance payments 4,539 6,469 Operating lease liabilities 106,661 0
Other long-term liabilities 34,793 61,262 Deferred tax liabilities
35 37
Total Liabilities 410,038
326,037 Stockholders' Equity Preferred
stock undesignated, $0.001 par value; 5,000 shares authorized; no
shares issued or outstanding 0 0 Class A common stock, $0.001 par
value; 330,000 shares authorized; 15,850 shares issued and 8,202
shares outstanding, and 15,837 shares issued and 8,552 shares
outstanding, respectively 16 16 Class B convertible common stock,
$0.001 par value; 165,000 shares authorized; 2,035 shares issued
and outstanding, and 2,035 shares issued and outstanding,
respectively 2 2 Additional paid-in capital 581,429 576,957
Treasury stock, at cost; 7,648 shares and 7,285 shares,
respectively (634,405 ) (586,161 ) Accumulated other comprehensive
loss (9,964 ) (10,217 ) Retained earnings 541,228
549,134
Total Stockholders' Equity 478,306
529,731 Total Liabilities and Stockholders'
Equity $ 888,344 $ 855,768 *
Derived from audited financial statements.
MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS OF
CASH FLOWS (in thousands) Three
Months Ended March 31, 2019
2018 (unaudited) (unaudited)
Operating activities:
Net (loss) income $ (7,906 ) $ 1,673 Adjustments to reconcile net
(loss) income to net cash provided by operating activities:
Depreciation and amortization 3,664 3,298 Bad debt expense 827 165
Net realized loss on short-term investments 41
0
Deferred taxes (1,694 ) (2,662 ) Share-based compensation expense
3,017 4,743 Changes in operating assets and liabilities: Accounts
receivable 10,266 422 Prepaid expenses and other current assets
(3,070 ) (3,783 ) Deposits and other assets (134 ) 228 Accounts
payable and accrued expenses (3,108 ) (6,016 ) Accrued compensation
and employee benefits (12,195 ) (8,085 ) Deferred revenue and
advance payments 38,502 19,570 Operating lease liabilities (2,074 )
0
Other long-term liabilities 320 9,164 Net cash
provided by operating activities 26,456 18,717
Investing activities: Proceeds from redemption of short-term
investments 314,403 195,820 Purchases of property and equipment
(6,011 ) (1,294 ) Purchases of short-term investments
(138,099 ) (483,440 ) Net cash provided by (used in)
investing activities 170,293 (288,914 )
Financing activities: Proceeds from sale of class A common
stock under exercise of employee stock options 1,507
0
Purchases of treasury stock (48,244 )
0
Payments on capital lease obligations and other financing
arrangements prior to the adoption of ASU 2016-02
0
(7 ) Net cash used in financing activities (46,737 )
(7 )
Effect of foreign exchange rate changes on
cash, cash equivalents, and restricted cash (1,133 )
2,202
Net increase (decrease) in cash, cash equivalents,
and restricted cash 148,879 (268,002 )
Cash, cash
equivalents, and restricted cash, beginning of period
110,786 421,182
Cash, cash equivalents, and restricted
cash, end of period $ 259,665 $ 153,180
MICROSTRATEGY INCORPORATED REVENUE AND COST OF REVENUE
DETAIL (in thousands) Three
Months Ended March 31, 2019
2018 (unaudited) (unaudited)
Revenues Product
licenses and subscription services: Product licenses $ 18,291 $
17,301 Subscription services 7,144 7,662 Total
product licenses and subscription services 25,435
24,963 Product support 71,450 74,415 Other services: Consulting
16,603 21,287 Education 1,878 2,302 Total other
services 18,481 23,589
Total revenues
115,366 122,967 Cost of revenues
Product licenses and subscription services: Product licenses 519
2,211 Subscription services 3,598 3,249 Total product
licenses and subscription services 4,117 5,460
Product support 7,067 4,796 Other services: Consulting 12,985
13,321 Education 2,004 1,608 Total other services
14,989 14,929
Total cost of revenues
26,173 25,185 Gross profit
$ 89,193 $ 97,782
MICROSTRATEGY INCORPORATED DEFERRED REVENUE DETAIL
(in thousands) March 31,
December 31, March 31,
2019 2018* 2018 (unaudited) (unaudited)
Current: Deferred product licenses revenue $ 555 $ 1,768 $
3,064 Deferred subscription services revenue 15,641 13,508 16,742
Deferred product support revenue 166,306 152,501 173,156 Deferred
other services revenue 7,568 8,763 8,756 Total
current deferred revenue and advance payments $ 190,070 $ 176,540 $
201,718
Non-current: Deferred product licenses
revenue $ 479 $ 542 $ 843 Deferred subscription services revenue
247 2,384 385 Deferred product support revenue 3,231 3,091 3,854
Deferred other services revenue 582 452 586
Total non-current deferred revenue and advance payments $ 4,539 $
6,469 $ 5,668
Total current and non-current: Deferred
product licenses revenue $ 1,034 $ 2,310 $ 3,907 Deferred
subscription services revenue 15,888 15,892 17,127 Deferred product
support revenue 169,537 155,592 177,010 Deferred other services
revenue 8,150 9,215 9,342 Total current and
non-current deferred revenue and advance payments $ 194,609 $
183,009 $ 207,386 * Derived from audited financial
statements.
MICROSTRATEGY INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP MEASURE (in
thousands) Three Months Ended
March 31, 2019 2018 (unaudited)
(unaudited)
Reconciliation of non-GAAP (loss) income from
operations: (Loss) income from operations $ (10,386 ) $ 715
Share-based compensation expense 3,017 4,743 Non-GAAP
(loss) income from operations $ (7,369 ) $ 5,458
MICROSTRATEGY INCORPORATED WORLDWIDE EMPLOYEE
HEADCOUNT March 31,
December 31, September 30,
June 30, March 31, 2019
2018 2018 2018 2018 Subscription
services 54 56 55 54 57 Product support 224 202 194 184 182
Consulting 429 452 458 443 441 Education 50 47 44 39 42 Sales and
marketing 675 707 699 687 667 Research and development 733 716 688
651 604 General and administrative 329 348 326 322 313 Total
headcount 2,494 2,528 2,464 2,380 2,306
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190430006128/en/
MicroStrategy IncorporatedInvestor RelationsClaudia
Cahillir@microstrategy.com(703) 848-8600
MicroStrategy (NASDAQ:MSTR)
Historical Stock Chart
From Apr 2024 to May 2024
MicroStrategy (NASDAQ:MSTR)
Historical Stock Chart
From May 2023 to May 2024
