Delivers Adjusted ARR growth of 35%
year-over-year
Software intelligence company Dynatrace (NYSE: DT) today
released financial results for the fourth quarter and full year
fiscal 2022 ended March 31, 2022. Dynatrace also announced today
that Kevin Burns, its Chief Financial Officer, will be leaving at
the end of calendar year 2022. Dynatrace has initiated a search for
a new CFO, and Mr. Burns will work to ensure a smooth transition of
his duties once a new CFO is appointed.
“Dynatrace delivered an extremely strong fourth quarter, closing
out fiscal 2022 with 35% Adjusted ARR growth for the second
straight year,” said Rick McConnell, Chief Executive Officer. “I am
proud of the Dynatrace team for having now crossed the $1 billion
dollar threshold in annualized revenue during the quarter, all
while delivering strong profitability and free cash flow. Digital
transformation and cloud migration trends continue to grow at a
rapid pace and serve as the foundation for significant future
growth. The combination of our material ongoing innovation coupled
with expanding routes to market with key partnerships provides
Dynatrace with strong momentum to capture the sizable market
opportunity ahead of us.”
All growth rates are compared to the fourth quarter and full
year of fiscal 2021 unless otherwise noted.
Fourth Quarter Fiscal 2022 Financial Highlights:
- Total ARR of $995 million, Adjusted ARR growth of 35%
year-over-year
- Total Revenue of $253 million, up 31% on a constant currency
basis
- Subscription Revenue of $235 million, up 31% on a constant
currency basis
- GAAP Operating Income of $18 million and Non-GAAP Operating
Income of $58 million
- GAAP EPS of $0.00 and non-GAAP EPS of $0.17, on a dilutive
basis
Full Year Fiscal 2022 Financial Highlights:
- Total Revenue of $929 million, up 32% on a constant currency
basis
- Subscription Revenue of $870 million, 32% on a constant
currency basis
- GAAP Operating Income of $81 million and Non-GAAP Operating
Income of $234 million
- GAAP EPS of $0.18 and non-GAAP EPS of $0.68, on a dilutive
basis
- Unlevered Free Cash Flow of $234 million, or 25% of
revenue
Business Highlights:
- Platform innovation: Delivered general availability of
the Dynatrace® platform as native SaaS on Microsoft Azure and
Google Cloud Platform in addition to existing availability through
Amazon Web Services. Enhanced the Dynatrace® Application Security
Module with real-time attack blocking capabilities. Enabled
development teams to bring higher quality, more secure code to
market faster by making Dynatrace observability, application
security, and advanced AIOps capabilities available as code.
- Go-to-market momentum: Grew new logos by 21% in fiscal
2022, adding 205 new logos to the Dynatrace® platform in the fourth
quarter, for a total of 706 new logos added this year. Sustained a
net expansion rate at or above 120% for the sixteenth consecutive
quarter.
- Partnership expansion: New ARR transacted through
hyperscaler partnerships, including AWS, Google, Microsoft, more
than tripled compared to the same period last year. Deloitte
selected the Dynatrace platform to power its expanded observability
practice (announced today). Enhanced Dynatrace Partner Program with
new DevSecOps Automation Partner Program, enabling partners to
extend the value of their solutions through seamless integrations
with the Dynatrace® platform and providing DevSecOps teams with
easy access to the industry’s leading solutions.
Executive Leadership Update
"On behalf of the entire Dynatrace team, I’d like to thank Kevin
for his many contributions since joining the company in 2016,” said
Rick McConnell, Chief Executive Officer. “He has played an integral
role in positioning Dynatrace for long term success, including the
transformation of our business model and successful IPO. We are
fortunate to have a strong and deep finance team, and we are intent
on the successful recruitment of a world-class CFO. I very much
appreciate Kevin’s commitment to a smooth transition over the
coming months.”
"The past six years at Dynatrace have been an incredible
experience. It has been a privilege to work alongside this very
talented group of people to grow this company into a billion-dollar
business," said Burns. "Heading into fiscal 2023, Dynatrace’s
position in the market has never been stronger. I am very proud of
Dynatrace’s accomplishments and believe it is well positioned to
continue to deliver significant growth and profitability in the
future."
Fourth Quarter 2022 Financial
Highlights
(Unaudited – In thousands,
except per share data)
Three Months Ended March
31,
2022
2021
Key Operating Metric:
Annualized recurring revenue
$
995,121
$
774,090
Year-over-Year Increase
29
%
Adjusted ARR Growth
35
%
Revenue:
Total revenue
$
252,585
$
196,504
Year-over-Year Increase
29
%
Total revenue - constant currency (*)
$
257,911
$
196,504
Year-over-Year Increase
31
%
Subscription revenue
$
234,974
$
182,842
Year-over-Year Increase
29
%
Subscription revenue - constant currency
(*)
$
239,937
$
182,842
Year-over-Year Increase
31
%
Non-GAAP Financial Measures:
Non-GAAP operating income (*)
$
57,656
$
49,478
Non-GAAP operating margin (*)
23
%
25
%
Non-GAAP net income (*)
$
48,287
$
43,371
Non-GAAP net income per share -
diluted
$
0.17
$
0.15
Non-GAAP shares outstanding - diluted
290,339
288,067
Unlevered Free Cash Flow (*)
$
82,306
$
85,602
Full Year 2022 Financial
Highlights
(Unaudited – In thousands,
except per share data)
Year Ended March 31,
2022
2021
Revenue:
Total revenue
$
929,445
$
703,509
Year-over-Year Increase
32
%
Total revenue - constant currency (*)
$
925,281
$
703,509
Year-over-Year Increase
32
%
Subscription revenue
$
870,385
$
655,180
Year-over-Year Increase
33
%
Subscription revenue - constant currency
(*)
$
866,533
$
655,180
Year-over-Year Increase
32
%
Non-GAAP Financial Measures:
Non-GAAP operating income (*)
$
233,766
$
207,251
Non-GAAP operating margin (*)
25
%
29
%
Non-GAAP net income (*)
$
197,502
$
180,056
Non-GAAP net income per share -
diluted
$
0.68
$
0.63
Non-GAAP shares outstanding - diluted
290,903
286,509
Unlevered Free Cash Flow (*)
$
234,265
$
237,055
* Use of Non-GAAP Financial Measures
In our earnings press releases, conference calls, slide
presentations, and webcasts, we may use or discuss non-GAAP
financial measures, as defined by Regulation G. The GAAP financial
measure most directly comparable to each non-GAAP financial measure
used or discussed, and a reconciliation of the differences between
each non-GAAP financial measure and the comparable GAAP financial
measure, are included in this press release after the consolidated
financial statements. Our earnings press releases containing such
non-GAAP reconciliations can be found in the Investors section of
our website at https://ir.dynatrace.com.
Financial Outlook
Our guidance is based on foreign exchange rates as of April 30,
2022. Since March 31, 2022, the U.S. dollar has continued to
strengthen, which results in a sizeable foreign exchange ("FX")
headwind. For fiscal 2023, we expect a total FX headwind to be
approximately $20 million dollars on ARR and revenue.
In addition, on March 8, 2022, we announced that we suspended
business in Russia and Belarus which results in a headwind of
approximately $6 million dollars on ARR and revenue for fiscal
2023.
Growth rates for Adjusted ARR, Total revenue, and Subscription
revenue are presented in constant currency in the table below to
provide better visibility into the underlying growth of the
business.
Based on information available, as of May 18, 2022, Dynatrace is
issuing guidance for the first quarter fiscal 2023 and full year
fiscal 2023 as follows:
All growth rates are compared to the first quarter and full year
of fiscal 2022 unless otherwise noted.
(In millions, except per share data)
First Quarter
Fiscal 2023
Full Year
Fiscal 2023
Total ARR
$1,250 - $1,265
As reported
26% - 27%
Constant currency
28% - 29%
Adjusted ARR growth
29% - 30%
Total revenue
$261 - $263.5
$1,142 - $1,158
As reported
24% - 26%
23% - 25%
Constant currency
29% - 31%
27% - 28%
Subscription revenue
$244.5 - $246.5
$1,071 - $1,086
As reported
24% - 25%
23% - 25%
Constant currency
29% - 30%
27% - 28%
Non-GAAP operating income
$60 - $62
$257 - $266
Non-GAAP net income
$50 - $52
$216 - $225
Non-GAAP net income per diluted share
$0.17 - $0.18
$0.74 - $0.77
Diluted weighted average shares
outstanding
291 - 292
292 - 294
Free cash flow
$330 - $345
Free cash flow margin
29% - 30%
Reconciliation of non-GAAP operating income, non-GAAP net
income, non-GAAP net income per share and free cash flow guidance
to the most directly comparable GAAP measures is not available
without unreasonable efforts on a forward-looking basis due to the
high variability, complexity and low visibility with respect to the
charges excluded from these non-GAAP measures; in particular, the
measures and effects of share-based compensation expense, employer
taxes and tax deductions specific to equity compensation awards
that are directly impacted by future hiring, turnover and retention
needs, as well as unpredictable fluctuations in our stock price. We
expect the variability of the above charges to have a significant,
and potentially unpredictable, impact on our future GAAP financial
results.
Conference Call and Webcast Information
Dynatrace will host a conference call and live webcast to
discuss its results and business outlook at 8:00 a.m. Eastern Time
today, May 18, 2022. To access the conference call from the U.S.
and Canada, dial (866) 405-1247, or internationally, dial (201)
689-8045 with event confirmation #: 13728998. The call will also be
available live via webcast on the company’s website,
ir.dynatrace.com.
An audio replay of the call will also be available until 11:59
p.m. Eastern Time on May 26, 2021, by dialing (877) 660-6853 from
the U.S. or Canada, or for international callers by dialing (201)
612-7415 and entering event confirmation #: 13728998. In addition,
an archived webcast will be available at ir.dynatrace.com.
The company has used, and intends to continue to use, the
investor relations portion of its website as a means of disclosing
material non-public information and for complying with disclosure
obligations under Regulation FD.
Non-GAAP Financial Measures & Key Metrics
In addition to disclosing financial measures prepared in
accordance with GAAP, this press release and the accompanying
tables contain certain non-GAAP financial measures.
Non-GAAP financial measures do not have any standardized meaning
and are therefore unlikely to be comparable to similarly titled
measures presented by other companies. Dynatrace considers these
non-GAAP financial measures to be important because they provide
useful indicators of its performance and liquidity measures. These
are key measures used by our management and board of directors to
understand and evaluate our core operating performance and trends,
to prepare and approve our annual budget and to develop short and
long-term operational plans. In addition, investors often use
similar measures to evaluate the performance of a company. Non-GAAP
financial measures are presented for supplemental informational
purposes only for understanding the company’s operating
performance. The non-GAAP financial measures should not be
considered a substitute for financial information presented in
accordance with GAAP, and may be different from non-GAAP financial
measures presented by other companies. The GAAP financial measure
most directly comparable to each non-GAAP financial measure used or
discussed, and a reconciliation of the differences between each
non-GAAP financial measure and the comparable GAAP financial
measure, are included in this press release after the consolidated
financial statements.
Dynatrace presents constant currency amounts for Revenue and
Annual Recurring Revenue to provide a framework for assessing how
our underlying business performed excluding the effect of foreign
currency rate fluctuations. To present this information, current
and comparative prior period results for entities reporting in
currencies other than United States dollars are converted into
United States dollars using the average exchange rates from the
comparative period rather than the actual exchange rates in effect
during the respective periods. All growth comparisons relate to the
corresponding period in the prior fiscal year. Dynatrace provides
this non-GAAP financial information to aid investors in better
understanding our performance.
Annual Recurring Revenue “ARR” is defined as the daily
revenue of all subscription agreements that are actively generating
revenue as of the last day of the reporting period multiplied by
365. We exclude from our calculation of Total ARR any revenues
derived from month-to-month agreements and/or product usage overage
billings.
Adjusted ARR is defined as ARR excluding the impact of
foreign exchange rate fluctuations that occurred over the trailing
twelve month period. This calculation also excludes the headwind
associated with the Dynatrace® perpetual license ARR that rolled
off in the trailing twelve month period.
Adjusted ARR Growth is defined as year-over-year growth
in Adjusted ARR divided by ARR as reported.
Dynatrace® Net Expansion Rate is defined as the
Dynatrace® ARR at the end of a reporting period for the cohort of
Dynatrace® accounts as of one year prior to the date of
calculation, divided by the Dynatrace® ARR one year prior to the
date of calculation for that same cohort. This calculation excludes
the benefit of Dynatrace® ARR resulting from the conversion of
Classic products to the Dynatrace® platform. Given that perpetual
license ARR continues to diminish, we will begin to exclude the
headwind associated with the Dynatrace perpetual license ARR
effective the first quarter of fiscal year 2023. We believe that
eliminating the perpetual license headwind will result in a Net
Expansion Rate metric that better reflects Dynatrace’s ability to
expand existing customer relationships.
Dynatrace customers are defined as accounts, as
identified by a unique account identifier, that generate at least
$10,000 of Dynatrace® ARR as of the reporting date. In infrequent
cases, a single large organization may comprise multiple customer
accounts when there are distinct divisions, departments or
subsidiaries that operate and make purchasing decisions
independently from the parent organization. In cases where multiple
customer accounts exist under a single organization, each customer
account is counted separately based on a mutually exclusive
accounting of ARR.
Unlevered Free Cash Flow is defined as net cash provided
by (used in) operating activities and adjusted to exclude cash paid
for interest (net of tax), non-recurring restructuring and
acquisition related costs, along with costs associated with
one-time offerings and filings, less cash used in investing
activities for acquisition of property and equipment. However,
given our debt obligations, unlevered free cash flow does not
represent residual cash flow available for discretionary
expenses.
Free Cash Flow is defined as net cash provided by (used
in) operating activities less capital expenditures.
About Dynatrace
Dynatrace exists to make the world’s software work perfectly.
Our unified software intelligence platform combines broad and deep
observability and continuous runtime application security with the
most advanced AIOps to provide answers and intelligent automation
from data at an enormous scale. This enables innovators to
modernize and automate cloud operations, deliver software faster
and more securely, and ensure flawless digital experiences. That is
why the world’s largest organizations trust Dynatrace® to
accelerate digital transformation.
Cautionary Language Concerning Forward-Looking
Statements
This press release includes certain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements regarding management’s expectations
of future financial and operational performance and operational
expenditures, expected growth, and business outlook, including our
financial guidance for the first quarter and full year of fiscal
2023, and statements regarding the size of our market and our
positioning for capturing a larger share of our market. These
forward-looking statements include, but are not limited to, plans,
objectives, expectations and intentions and other statements
contained in this press release that are not historical facts and
statements identified by words such as “expects,” “anticipates,”
“intends,” “plans,” “believes,” “seeks,” “estimates” or words of
similar meaning. These forward-looking statements reflect our
current views about our plans, intentions, expectations, strategies
and prospects, which are based on the information currently
available to us and on assumptions we have made. Although we
believe that our plans, intentions, expectations, strategies and
prospects as reflected in or suggested by those forward-looking
statements are reasonable, we can give no assurance that the plans,
intentions, expectations or strategies will be attained or
achieved. Furthermore, actual results may differ materially from
those described in the forward-looking statements and will be
affected by a variety of risks and factors that are beyond our
control including, without limitation, the effect of the COVID-19
pandemic on our business operations and demand for our products as
well as its impact on general economic and financial market
conditions; our ability to maintain our subscription revenue growth
rates in future periods, our ability to service our level of
indebtedness, market adoption of software intelligence solutions
for application performance monitoring, digital experience
monitoring, infrastructure monitoring, AIOps, business intelligence
and analytics and application security, continued spending on and
demand for software intelligence solutions, our ability to maintain
and acquire new customers, our ability to differentiate our
platform from competing products and technologies; our ability to
successfully recruit and retain highly-qualified personnel; the
price volatility of our common stock, and other risks set forth
under the caption “Risk Factors” in our most recently filed Form
10-Q filed on February 2, 2022 and our other SEC filings. We assume
no obligation to update any forward-looking statements contained in
this document as a result of new information, future events or
otherwise.
DYNATRACE, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In thousands, except per
share data)
Three Months Ended March
31,
Twelve Months Ended March
31,
2022
2021
2022
2021
(unaudited)
Revenue:
Subscription
$
234,974
$
182,842
$
870,385
$
655,180
License
2
109
54
1,446
Service
17,609
13,553
59,006
46,883
Total revenue
252,585
196,504
929,445
703,509
Cost of revenue:
Cost of subscription
31,245
22,073
111,646
77,488
Cost of service
12,796
9,432
45,717
34,903
Amortization of acquired technology
3,875
3,830
15,513
15,317
Total cost of revenue
47,916
35,335
172,876
127,708
Gross profit
204,669
161,169
756,569
575,801
Operating expenses:
Research and development
42,833
31,668
156,342
111,415
Sales and marketing
101,300
74,805
362,116
245,487
General and administrative
35,368
25,140
126,622
92,219
Amortization of other intangibles
7,539
8,687
30,157
34,744
Restructuring and other
—
17
25
40
Total operating expenses
187,040
140,317
675,262
483,905
Income from operations
17,629
20,852
81,307
91,896
Interest expense, net
(2,234
)
(3,035
)
(10,192
)
(14,205
)
Other income (expense), net
1,889
(2,582
)
544
162
Income before income taxes
17,284
15,235
71,659
77,853
Income tax (expense) benefit
(16,355
)
11,719
(19,208
)
(2,139
)
Net income
$
929
$
26,954
$
52,451
$
75,714
Net income per share:
Basic
$
0.00
$
0.10
$
0.18
$
0.27
Diluted
$
0.00
$
0.09
$
0.18
$
0.26
Weighted average shares outstanding:
Basic
285,349
281,726
284,161
280,469
Diluted
290,339
288,067
290,903
286,509
SHARE-BASED
COMPENSATION
Three Months Ended March
31,
Twelve Months Ended March
31,
2022
2021
2022
2021
(unaudited)
Cost of revenue
$
3,321
$
1,877
$
12,863
$
7,307
Research and development
5,985
3,018
21,316
11,684
Sales and marketing
9,470
6,146
35,957
24,153
General and administrative
8,810
3,652
29,400
14,640
Total share-based compensation expense
$
27,586
$
14,693
$
99,536
$
57,784
DYNATRACE, INC.
CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
data)
March 31,
2022
2021
Assets
Current assets:
Cash and cash equivalents
$
462,967
$
324,962
Accounts receivable, net
350,666
242,079
Deferred commissions, current
62,601
48,986
Prepaid expenses and other current
assets
72,188
64,255
Total current assets
948,422
680,282
Property and equipment, net
45,271
36,916
Operating lease right-of-use asset,
net
58,849
42,959
Goodwill
1,281,876
1,271,195
Other intangible assets, net
105,736
149,484
Deferred tax assets, net
28,106
16,811
Deferred commissions, non-current
63,435
48,638
Other assets
9,615
9,933
Total assets
$
2,541,310
$
2,256,218
Liabilities and shareholders'
equity
Current liabilities:
Accounts payable
$
22,715
$
9,621
Accrued expenses, current
141,556
119,527
Deferred revenue, current
688,554
509,272
Operating lease liabilities, current
12,774
9,491
Total current liabilities
865,599
647,911
Deferred revenue, non-current
25,783
47,504
Accrued expenses, non-current
19,409
16,072
Operating lease liabilities,
non-current
52,070
38,203
Deferred tax liabilities
85
1,014
Long-term debt
273,918
391,913
Total liabilities
1,236,864
1,142,617
Shareholders' equity:
Common shares, $0.001 par value,
600,000,000 shares authorized, 286,053,276 and 283,130,238 shares
issued and outstanding at March 31, 2022 and 2021, respectively
286
283
Additional paid-in capital
1,792,197
1,653,328
Accumulated deficit
(461,348
)
(513,799
)
Accumulated other comprehensive loss
(26,689
)
(26,211
)
Total shareholders' equity
1,304,446
1,113,601
Total liabilities and shareholders'
equity
$
2,541,310
$
2,256,218
DYNATRACE, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands)
Year Ended March 31,
2022
2021
Cash flows from operating
activities:
Net income
$
52,451
$
75,714
Adjustments to reconcile net income to
cash provided by operations:
Depreciation
10,638
9,022
Amortization
46,238
51,942
Share-based compensation
99,536
57,784
Deferred income taxes
(12,401
)
(7,036
)
Other
1,486
1,845
Net change in operating assets and
liabilities:
Accounts receivable
(108,848
)
(81,992
)
Deferred commissions
(29,533
)
(16,323
)
Prepaid expenses and other assets
(8,108
)
5,669
Accounts payable and accrued expenses
35,946
26,592
Operating leases, net
1,353
731
Deferred revenue
162,159
96,488
Net cash provided by operating
activities
250,917
220,436
Cash flows from investing
activities:
Purchase of property and equipment
(17,695
)
(14,076
)
Capitalized software costs
—
197
Acquisition of businesses, net of cash
acquired
(13,195
)
—
Net cash used in investing activities
(30,890
)
(13,879
)
Cash flows from financing
activities:
Repayment of term loans
(120,000
)
(120,000
)
Proceeds from employee stock purchase
plan
13,913
9,195
Proceeds from exercise of stock
options
25,489
13,052
Equity repurchases
(66
)
(49
)
Net cash used in financing activities
(80,664
)
(97,802
)
Effect of exchange rates on cash and cash
equivalents
(1,358
)
3,037
Net increase in cash and cash
equivalents
138,005
111,792
Cash and cash equivalents, beginning of
year
324,962
213,170
Cash and cash equivalents, end of year
$
462,967
$
324,962
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In
thousands)
Three Months Ended March 31,
2022
GAAP
Share-based
compensation
Employer payroll taxes on
employee stock transactions
Amortization of other
intangibles
Restructuring &
other
Non-GAAP
Non-GAAP operating income:
Cost of revenue
$
47,916
$
(3,321
)
$
(143
)
$
(3,875
)
$
—
$
40,577
Gross profit
204,669
3,321
143
3,875
—
212,008
Gross margin
81
%
84
%
Research and development
42,833
(5,985
)
(259
)
—
—
36,589
Sales and marketing
101,300
(9,470
)
(424
)
—
—
91,406
General and administrative
35,368
(8,810
)
(123
)
—
(78
)
26,357
Amortization of other intangibles
7,539
—
—
(7,539
)
—
—
Restructuring and other
—
—
—
—
—
—
Operating income
$
17,629
$
27,586
$
949
$
11,414
$
78
$
57,656
Operating margin
7
%
23
%
Three Months Ended March 31,
2021
GAAP
Share-based
compensation
Employer payroll taxes on
employee stock transactions
Amortization of other
intangibles
Restructuring &
other
Non-GAAP
Non-GAAP operating income:
Cost of revenue
$
35,335
$
(1,877
)
$
(224
)
$
(3,830
)
$
—
$
29,404
Gross profit
161,169
1,877
224
3,830
—
167,100
Gross margin
82
%
85
%
Research and development
31,668
(3,018
)
(378
)
—
—
28,272
Sales and marketing
74,805
(6,146
)
(637
)
—
—
68,022
General and administrative
25,140
(3,652
)
(202
)
—
42
21,328
Amortization of other intangibles
8,687
—
—
(8,687
)
—
—
Restructuring and other
17
—
—
—
(17
)
—
Operating income (loss)
$
20,852
$
14,693
$
1,441
$
12,517
$
(25
)
$
49,478
Operating margin
11
%
25
%
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In thousands,
except per share data)
Three Months Ended March
31,
2022
2021
Non-GAAP net income:
Net income
$
929
$
26,954
Income tax expense (benefit)
16,355
(11,719
)
Non-GAAP effective cash tax
(7,543
)
(3,546
)
Interest expense, net
2,234
3,035
Cash paid for interest
(1,826
)
(2,561
)
Share-based compensation
27,586
14,693
Employer payroll taxes on employee stock
transactions
949
1,441
Amortization of other intangibles
7,539
8,687
Amortization of acquired technology
3,875
3,830
Transaction, restructuring, and other
78
(25
)
(Gain) loss on currency translation
(1,889
)
2,582
Non-GAAP net income
$
48,287
$
43,371
Share count:
Weighted-average shares outstanding -
basic
285,349
281,726
Weighted-average shares outstanding -
diluted
290,339
288,067
Shares used in non-GAAP per share
calculations:
Weighted-average shares outstanding -
basic
285,349
281,726
Weighted-average shares outstanding -
diluted
290,339
288,067
Net income per share:
Net income per share - basic
$
0.00
$
0.10
Net income per share - diluted
$
0.00
$
0.09
Non-GAAP net income per share - basic
$
0.17
$
0.15
Non-GAAP net income per share -
diluted
$
0.17
$
0.15
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In
thousands)
Three Months Ended March
31,
2022
2021
Unlevered Free Cash Flow
("uFCF"):
Net cash provided by operating
activities
$
88,305
$
85,871
Cash paid for interest expense
1,826
2,561
Purchase of property and equipment
(5,927
)
(5,208
)
Transaction, restructuring, and other
78
(25
)
Discrete tax items
(1,519
)
3,043
Total uFCF
82,763
86,242
Interest tax adjustment
(457
)
(640
)
uFCF
$
82,306
$
85,602
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In
thousands)
Year Ended March 31,
2022
GAAP
Share-based
compensation
Employer payroll taxes on
employee stock transactions
Amortization of other
intangibles
Restructuring &
other
Non-GAAP
Non-GAAP operating income:
Cost of revenue
$
172,876
$
(12,863
)
$
(1,059
)
$
(15,513
)
$
—
$
143,441
Gross profit
756,569
12,863
1,059
15,513
—
786,004
Gross margin
81
%
85
%
Research and development
156,342
(21,316
)
(1,879
)
—
—
133,147
Sales and marketing
362,116
(35,957
)
(2,305
)
—
—
323,854
General and administrative
126,622
(29,400
)
(701
)
—
(1,284
)
95,237
Amortization of other intangibles
30,157
—
—
(30,157
)
—
—
Restructuring and other
25
—
—
—
(25
)
—
Operating income
$
81,307
$
99,536
$
5,944
$
45,670
$
1,309
$
233,766
Operating margin
9
%
25
%
Year Ended March 31,
2021
GAAP
Share-based
compensation
Employer payroll taxes on
employee stock transactions
Amortization of other
intangibles
Restructuring &
other
Non-GAAP
Non-GAAP operating income:
Cost of revenue
$
127,708
$
(7,307
)
$
(718
)
$
(15,317
)
$
—
$
104,366
Gross profit
575,801
7,307
718
15,317
—
599,143
Gross margin
82
%
85
%
Research and development
111,415
(11,684
)
(1,356
)
—
—
98,375
Sales and marketing
245,487
(24,153
)
(1,630
)
—
—
219,704
General and administrative
92,219
(14,640
)
(410
)
—
(3,356
)
73,813
Amortization of other intangibles
34,744
—
—
(34,744
)
—
—
Restructuring and other
40
—
—
—
(40
)
—
Operating income
$
91,896
$
57,784
$
4,114
$
50,061
$
3,396
$
207,251
Operating margin
13
%
29
%
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In thousands,
except per share data)
Year Ended March 31,
2022
2021
Non-GAAP net income:
Net income
$
52,451
$
75,714
Income tax expense
19,208
2,139
Non-GAAP effective cash tax
(27,889
)
(14,720
)
Interest expense, net
10,192
14,205
Cash paid for interest
(8,375
)
(12,475
)
Share-based compensation
99,536
57,784
Employer payroll taxes on employee stock
transactions
5,944
4,114
Amortization of other intangibles
30,157
34,744
Amortization of acquired technology
15,513
15,317
Transaction, restructuring, and other
1,309
3,396
Gain on currency translation
(544
)
(162
)
Non-GAAP net income
$
197,502
$
180,056
Share count:
Weighted-average shares outstanding -
basic
284,161
280,469
Weighted-average shares outstanding -
diluted
290,903
286,509
Shares used in non-GAAP per share
calculations:
Weighted-average shares outstanding -
basic
284,161
280,469
Weighted-average shares outstanding -
diluted
290,903
286,509
Net income (loss) per share:
Net income (loss) per share - basic
$
0.18
$
0.27
Net income (loss) per share - diluted
$
0.18
$
0.26
Non-GAAP net income per share - basic
$
0.70
$
0.64
Non-GAAP net income per share -
diluted
$
0.68
$
0.63
DYNATRACE, INC.
GAAP to Non-GAAP
Reconciliations
(Unaudited - In
thousands)
Year Ended March 31,
2022
2021
Unlevered Free Cash Flow
("uFCF"):
Net cash provided by operating
activities
$
250,917
$
220,436
Cash paid for interest expense
8,375
12,475
Purchase of property and equipment
(17,695
)
(14,076
)
Transaction, restructuring, and other
1,309
3,396
Discrete tax items
(6,547
)
17,943
Total uFCF
236,359
240,174
Interest tax adjustment
(2,094
)
(3,119
)
uFCF
$
234,265
$
237,055
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220518005108/en/
Investor Contact: Noelle Faris VP, Investor Relations
Noelle.Faris@dynatrace.com Media Relations: Jerome Stewart VP,
Communications Jerome.Stewart@dynatrace.com
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