Fourth Quarter & Fiscal Year 2014 Results | Cornerstone OnDemand
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Cornerstone OnDemand Announces Fourth Quarter and Fiscal Year 2014 Financial Results

 

Record quarterly revenue of $76.4 million, up 39% year-over-year

Record full year revenue of $263.6 million, up 42% year-over-year

Record quarterly bookings of $114.2 million, up 35% year-over-year

Record annual bookings of $316.1 million, up 36% year-over-year1

Record quarterly user additions, ending the year with approximately 18.1 million users2

Record quarterly client additions, ending the year with over 2,100 clients2

SANTA MONICA, Calif. – February 11, 2015 – Talent management software provider Cornerstone OnDemand, Inc. (NASDAQ: CSOD) today announced results for its fourth quarter and year ended December 31, 2014.

Revenue for the fourth quarter of 2014 was $76.4 million, representing a 39% increase compared to the same period in 2013. Revenue for the full year of 2014 was $263.6 million, representing a 42% increase compared to the same period in 2013.

Bookings, which the Company defines as revenue plus the change in deferred revenue for the period, were $114.2 million for the fourth quarter of 2014, representing a 35% increase compared to the same period in 2013. 1 Bookings for the full year of 2014 were $316.1 million, representing a 36% increase compared to the same period in 2013. 1 Deferred revenue at December 31, 2014 was $191.3 million, representing a 38% increase compared to the balance at December 31, 2013.

 

"While 2014 certainly presented its challenges, our fourth quarter performance represented a strong finish to the year and we believe is indicative of the significant opportunity that lies ahead," said Adam Miller, the Company's President and CEO. "With the sales force changes fully behind us, the competitive environment in a further weakened state, and our continued commitment to product innovation, Cornerstone is well-positioned for a strong year in 2015."

Gross profit for the fourth quarter of 2014 was $52.9 million, representing a 34% increase compared to the same period in 2013. Gross profit for the full year of 2014 was $185.9 million, representing a 41% increase compared to the same period in 2013.

Non-GAAP gross profit for the fourth quarter of 2014 was $55.8 million, representing a 38% increase compared to the same period in 2013.1 Non-GAAP gross profit for the full year of 2014 was $191.8 million, representing a 42% increase compared to the same period in 2013.1

The Company's operating loss for the fourth quarter of 2014 was $(14.2) million, yielding an operating loss margin of (18.6)%, compared to an operating loss of $(7.8) million, yielding an operating loss margin of (14.3)%, for the fourth quarter of 2013. The Company's operating loss for the full year of 2014 was $(49.9) million, yielding an operating loss margin of (18.9)%, compared to an operating loss of $(34.0) million, yielding an operating loss margin of (18.4)%, for the full year of 2013.

Non-GAAP operating loss for the fourth quarter of 2014 was $(2.0) million, yielding a non-GAAP operating loss margin of (2.6)%, compared to a non-GAAP operating loss of $(0.4) million, yielding a non-GAAP operating loss margin of (0.7)%, for the fourth quarter of 2013.1 Non-GAAP operating loss for the full year of 2014 was $(10.3) million, yielding a non-GAAP operating loss margin of (3.9)%, compared to a non-GAAP operating loss of $(9.6) million, yielding a non-GAAP operating loss margin of (5.2)%, for the full year of 2013.1

The Company's net loss for the fourth quarter of 2014 was $(18.2) million, yielding a net loss margin of (23.8)%, or a $(0.34) net loss per share, compared to a net loss of $(10.8) million, yielding a net loss margin of (19.6)%, or a $(0.21) net loss per share, for the fourth quarter of 2013. The Company's net loss for the full year of 2014 was $(64.9) million, yielding a net loss margin of  (24.6)%, or a $(1.22) net loss per share, compare to a net loss of $(40.4) million, yielding a net loss margin of (21.8)%, or a $(0.79) net loss per share, for the full year of 2013.

Non-GAAP net loss for the fourth quarter of 2014 was $(3.9) million, yielding a non-GAAP net loss margin of (5.0)%, or a $(0.07) non-GAAP net loss per share, compared to a non-GAAP net loss of $(1.7) million, yielding a non-GAAP net loss margin of (3.1)%, or a $(0.03) non-GAAP net loss per share, for the fourth quarter of 2013.1 Non-GAAP net loss for the full year of 2014 was $(17.0) million, yielding a non-GAAP net loss margin of (6.4)%, or a $(0.32) non-GAAP net loss per share, compared to a non-GAAP net loss of $(12.5) million, yielding a non-GAAP net loss margin of (6.7)%, or a $(0.24) non-GAAP net loss per share, for the full year of 2013.1

For the full year of 2014, net cash provided by operating activities was $33.0 million as compared to $17.4 million for the same period in 2013. For the full year of 2014, non-GAAP net cash provided by operating activities was $33.3 million as compared to $20.6 million for the same period in 2013.1

At December 31, 2014, the Company's total cash and cash equivalents were $166.6 million, investments were $120.0 million, and accounts receivable were $84.5 million, yielding a total of approximately $371.1 million.

The Company ended the quarter with approximately 18.1 million users, representing the addition of approximately 1.5 million users.2

 

1

 

Bookings, non-GAAP gross profit, non-GAAP operating loss, non-GAAP operating loss margin, non-GAAP net loss, non-GAAP net loss margin, non-GAAP net loss per share, and non-GAAP net cash provided by operating activities are non-GAAP financial measures. Please see the discussion in the section ÒNon-GAAP Financial MeasuresÓ and the reconciliations at the end of this release.

2

 

Includes contracted clients and active users of our Enterprise and Mid-Market solution, excluding Cornerstone for Salesforce and Cornerstone Growth Edition, formerly known as Cornerstone for Small Business.

 

Quarterly Conference Call

Cornerstone OnDemand, Inc. will host a conference call to discuss its fourth quarter and fiscal year 2014 results at 2:00 p.m. PST (5:00 p.m. ET) today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the Company's Investor Relations Web site at http://investors.cornerstoneondemand.com/investors/news-and-events/events/default.aspx. The live call can be accessed by dialing (877) 445-4619 (U.S.) or (484) 653-6763 (outside the U.S.) and referencing passcode: 62167300. A replay of the call will also be available at http://investors.cornerstoneondemand.com/investors/news-and-events/events/default.aspx or via telephone until 11:59 p.m. PST on February 14, 2015 by dialing (855) 859-2056 (U.S.) or (404) 537-3406 (outside the U.S.), and referencing passcode: 62167300.

About Cornerstone OnDemand

Cornerstone OnDemand, Inc. is a leader in cloud-based applications for talent management. Our solutions help organizations recruit, train, manage and engage their employees, empowering their people and increasing workforce productivity. Based in Santa Monica, California, our solutions are used by over 2,100 clients worldwide, spanning approximately 18.1 million users across 191 countries and in 42 languages. For more information about Cornerstone OnDemand, Inc., visit www.csod.com.

Note: Cornerstone¨ and Cornerstone OnDemand¨ are registered trademarks of Cornerstone OnDemand, Inc.

Forward-looking Statements

This release and the quarterly conference call referenced above contain forward-looking statements, including statements regarding Cornerstone OnDemand's future financial performance, including the performance of our core business and emerging businesses, market growth, the demand for and benefits from the use of Cornerstone OnDemand's solutions, and general business conditions. Any forward-looking statements contained in this press release or the quarterly conference call are based upon Cornerstone OnDemand's historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates, or expectations will be achieved. These forward-looking statements represent Cornerstone OnDemand's expectations as of the date of this press release. Subsequent events may cause these expectations to change, and Cornerstone OnDemand disclaims any obligation to update the forward-looking statements in the future. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from Cornerstone OnDemand's current expectations. Important factors that could cause actual results to differ materially from those anticipated in our forward-looking statements include, but are not limited to, our ability to attract new clients; the extent to which clients renew their subscriptions for our solution; the timing of when consulting services are delivered to our new and existing clients by our services organization and implementation subcontractors; the complexity of deployments and product implementations, which can impact the timing of when revenue is recognized from new and existing clients; our ability to compete as the talent management provider for organizations of all sizes; changes in the proportion of our client base that is comprised of enterprise or mid-sized organizations; our ability to manage our growth, including additional headcount and entry into new geographies; our ability to expand our enterprise and mid-market sales teams; our ability to maintain stable and consistent quota attainment rates; our ability to exploit Big Data to drive increased demand for our products; continued strong demand for talent management in the U.S., Europe, Asia Pacific and Latin America; the timing and success of solutions offered by our competitors; unpredictable macro-economic conditions; reductions in information technology spending; the success of our new product and service introductions; a disruption in our hosting network infrastructure; costs and reputational harm that could result from defects in our solution; the success of our strategic relationships with third parties; the loss of any of our key employees; failure to protect our intellectual property; acts of terrorism or other vandalism, war or natural disasters; changes in current tax or accounting rules; unanticipated costs or liabilities related to businesses that we acquire; our ability to successfully integrate our operations with those of recently acquired Evolv Inc.; and other risks and uncertainties. Further information on factors that could cause actual results to differ materially from the results anticipated by our forward-looking statements is included in Cornerstone OnDemand's reports filed with the SEC, including its Quarterly Report on Form 10-Q filed with the SEC on November 7, 2014.

Additional Information

The Company is in the process of completing its analysis of its deferred tax balances, which include a full valuation allowance. Final GAAP financial statements and related footnotes with finalized deferred tax balances and disclosures will be included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014.

Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, Cornerstone OnDemand has provided in this release and the quarterly conference call held on the date hereof certain measures that have not been prepared in accordance with GAAP. These non-GAAP financial measures include (i) non-GAAP revenue, which is defined as revenue plus revenue not recognized in the period due to the impact of purchase accounting rules on deferred revenue acquired through acquisitions, (ii) non-GAAP cost of revenue, which is defined as cost of revenue less amortization of intangible assets and stock-based compensation and employer-related taxes, (iii) bookings, which are defined as revenue plus the change in deferred revenue for the period, (iv) non-GAAP net cash provided by operating activities, which excludes payment of acquisition related costs, payment of premium on investments net of related amortization and employer-related taxes from stock-based compensation, (v) non-GAAP net cash provided by operating activities margin, which is defined as non-GAAP net cash provided by operating activities divided by non-GAAP revenue, (vi) non-GAAP net loss and non-GAAP net loss per share, which are based on non-GAAP revenue and exclude, for the periods in which they are present, stock-based compensation and employer-related payroll taxes, amortization of intangible assets, adjustments to taxes related to acquisition adjustments, acquisition related costs, accretion of debt discount and amortization of debt issuance costs, and other amortization costs, (vii) non-GAAP net loss margin, which is defined as non-GAAP net loss divided by non-GAAP revenue, (viii) non-GAAP gross profit and non-GAAP gross margin, which are calculated based on non-GAAP revenue and exclude stock-based compensation and employer-related taxes and amortization of certain intangible assets reflected in cost of revenue, (ix) non-GAAP operating loss and non-GAAP operating loss margin, which are calculated based on operating loss and exclude adjustments to revenue, stock-based compensation and employer-related taxes, amortization of intangible assets and acquisition costs, and (x) non-GAAP operating expenses, which exclude stock-based compensation, employer-related taxes, and amortization of intangible assets, and (xi) non-GAAP sales and marketing expense, non-GAAP research and development expense, and non-GAAP general and administrative expense, each of which excludes stock-based compensation and employer-related taxes attributable to the corresponding GAAP financial measures.

Cornerstone OnDemand's management uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to the corresponding GAAP measures, in evaluating Cornerstone OnDemand's ongoing operational performance and trends and in comparing its financial measures with other companies in the same industry, many of which present similar non-GAAP financial measures to help investors understand the operational performance of their businesses. However, it is important to note that the particular items Cornerstone excludes from, or includes in, its non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry.

 

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures has been provided in the tables included as part of this press release.

Cornerstone OnDemand, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

 

 

December 31,
 2014

 

December 31, 2013

Assets

 

 

 

 

 

Cash and cash equivalents

$

166,557

 

 

$

109,583

 

Short-term investments

116,106

 

 

199,925

 

Accounts receivable, net

84,499

 

 

67,191

 

Deferred commissions

26,236

 

 

16,634

 

Prepaid expenses and other current assets

13,007

 

 

14,118

 

Total current assets

406,405

 

 

407,451

 

 

 

 

 

 

 

Capitalized software development costs, net

15,719

 

 

10,665

 

Property and equipment, net

21,424

 

 

14,436

 

Long-term investments

3,938

 

 

 

Intangible assets, net

27,282

 

 

4,632

 

Goodwill

25,894

 

 

8,193

 

Other assets, net

4,993

 

 

5,978

 

Total Assets

$

505,655

 

 

$

451,355

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

Liabilities:

 

 

 

 

 

Accounts payable

$

16,737

 

 

$

10,037

 

Accrued expenses

29,476

 

 

22,288

 

Deferred revenue, current portion

180,598

 

 

135,322

 

Capital lease obligations, current portion

236

 

 

905

 

Debt, current portion

351

 

 

519

 

Other liabilities

3,052

 

 

4,203

 

Total current liabilities

230,450

 

 

173,274

 

 

 

 

 

 

 

Convertible notes, net

225,094

 

 

217,965

 

Other liabilities, non-current

3,871

 

 

3,111

 

Deferred revenue, net of current portion

10,738

 

 

3,500

 

Capital lease obligations, net of current portion

 

 

218

 

Debt, net of current portion

 

 

392

 

Total liabilities

470,153

 

 

398,460

 

 

 

 

 

 

 

Stockholders' Equity:

 

 

 

 

 

Common stock

5

 

 

5

 

Additional paid-in capital

336,692

 

 

289,307

 

Accumulated deficit

(301,366

)

 

(236,467

)

Accumulated other comprehensive income

171

 

 

50

 

Total stockholders' equity

35,502

 

 

52,895

 

Total Liabilities and Stockholders' Equity

$

505,655

 

 

$

451,355

 

 

Cornerstone OnDemand, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Revenue

$

76,373

 

 

$

54,856

 

 

$

263,568

 

 

$

185,129

 

Cost of revenue 1, 2

23,497

 

 

15,488

 

 

77,684

 

 

53,548

 

Gross profit

52,876

 

 

39,368

 

 

185,884

 

 

131,581

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing 1

46,293

 

 

31,852

 

 

162,552

 

 

109,737

 

Research and development 1

9,283

 

 

5,893

 

 

30,618

 

 

21,260

 

General and administrative 1

11,317

 

 

9,215

 

 

41,802

 

 

33,572

 

Amortization of certain acquired intangible assets

153

 

 

251

 

 

828

 

 

1,004

 

Total operating expenses

67,046

 

 

47,211

 

 

235,800

 

 

165,573

 

Loss from operations

(14,170

)

 

(7,843

)

 

(49,916

)

 

(33,992

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

Interest income

133

 

 

205

 

 

720

 

 

357

 

Interest expense

(3,070

)

 

(3,001

)

 

(12,157

)

 

(6,563

)

Other, net

(735

)

 

(213

)

 

(2,691

)

 

(356

)

Other income (expense), net

(3,672

)

 

(3,009

)

 

(14,128

)

 

(6,562

)

Loss before income tax (provision) benefit

(17,842

)

 

(10,852

)

 

(64,044

)

 

(40,554

)

Income tax (provision) benefit

(324

)

 

97

 

 

(855

)

 

128

 

Net loss

$

(18,166

)

 

$

(10,755

)

 

$

(64,899

)

 

$

(40,426

)

Net loss per share, basic and diluted

$

(0.34

)

 

$

(0.21

)

 

$

(1.22

)

 

$

(0.79

)

Weighted average common shares outstanding, basic and diluted

53,660

 

 

52,185

 

 

53,267

 

 

51,427

 

 

 

1

 

Includes stock-based compensation and employer-related taxes as follows:

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Cost of revenue

$

707

 

 

$

746

 

 

$

2,749

 

 

$

2,324

 

Sales and marketing

5,142

 

 

3,486

 

 

18,830

 

 

10,651

 

Research and development

1,056

 

 

702

 

 

3,612

 

 

2,129

 

General and administrative

2,350

 

 

1,936

 

 

9,165

 

 

6,905

 

                  Total

$

9,255

 

 

$

6,870

 

 

$

34,356

 

 

$

22,009

 

 

2

 

Cost of revenue includes amortization of intangibles as follows:

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Cost of revenue

$

1,767

 

 

$

313

 

 

$

2,703

 

 

$

1,252

 

 

 

Cornerstone OnDemand, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

 

2013

 

 

2014

 

 

2013

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(18,166

)

 

$

(10,755

)

 

$

(64,899

)

 

$

(40,426

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

5,255

 

 

2,703

 

 

15,086

 

 

9,700

 

Accretion of debt discount and amortization of debt issuance costs

2,107

 

 

2,006

 

 

8,274

 

 

4,273

 

Purchased investment premium, net of amortization

591

 

 

1,000

 

 

816

 

 

(2,031

)

Unrealized foreign exchange loss (gain)

327

 

 

(133

)

 

1,656

 

 

242

 

Stock-based compensation expense

9,176

 

 

6,577

 

 

33,680

 

 

20,840

 

Deferred income taxes

(7

)

 

(515

)

 

(7

)

 

(865

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

2,246

 

 

(11,001

)

 

(18,674

)

 

(19,046

)

Deferred commissions

(6,570

)

 

(4,044

)

 

(10,097

)

 

(7,085

)

Prepaid expenses and other assets

400

 

 

(1,808

)

 

1,245

 

 

(6,057

)

Accounts payable

2,525

 

 

2,071

 

 

4,562

 

 

5,082

 

Accrued expenses

6,321

 

 

4,520

 

 

6,446

 

 

6,828

 

Deferred revenue

39,552

 

 

28,668

 

 

55,216

 

 

45,230

 

Other liabilities

683

 

 

206

 

 

(295

)

 

746

 

Net cash provided by operating activities

44,440

 

 

19,495

 

 

33,009

 

 

17,431

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

Purchases of investments

 

 

 

 

(124,191

)

 

(203,959

)

Maturities of investments

63,229

 

 

723

 

 

203,078

 

 

6,182

 

Purchases of property and equipment

(503

)

 

(2,295

)

 

(11,025

)

 

(8,762

)

Capitalized software costs

(2,529

)

 

(1,919

)

 

(9,529

)

 

(6,906

)

Cash paid for acquisition, net of cash acquired

(43,328

)

 

 

 

(43,328

)

 

 

Net cash provided by (used in) investing activities

16,869

 

 

(3,491

)

 

15,005

 

 

(213,445

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

Proceeds from the issuance of convertible notes, net

 

 

 

 

 

 

245,664

 

Payments for convertible note hedges

 

 

 

 

 

 

(49,537

)

Proceeds from the issuance of warrants

 

 

 

 

 

 

23,225

 

Proceeds from issuance of debt

 

 

 

 

 

 

1,914

 

Repayment of debt

(134

)

 

(137

)

 

(559

)

 

(4,038

)

Principal payments under capital lease obligations

(185

)

 

(358

)

 

(886

)

 

(1,747

)

Proceeds from stock option and warrant exercises

2,564

 

 

4,209

 

 

12,285

 

 

13,447

 

Net cash provided by financing activities

2,245

 

 

3,714

 

 

10,840

 

 

228,928

 

Effect of exchange rate changes on cash and cash equivalents

(991

)

 

224

 

 

(1,880

)

 

227

 

Net increase in cash and cash equivalents

62,563

 

 

19,942

 

 

56,974

 

 

33,141

 

Cash and cash equivalents at beginning of period

103,994

 

 

89,641

 

 

109,583

 

 

76,442

 

Cash and cash equivalents at end of period

$

166,557

 

 

$

109,583

 

 

$

166,557

 

 

$

109,583

 

 

Cornerstone OnDemand, Inc.

RECONCILIATIONS OF REVENUE TO NON-GAAP REVENUE, COST OF REVENUE TO NON-GAAP COST OF REVENUE, GROSS PROFIT AND GROSS MARGIN TO NON-GAAP GROSS PROFIT AND NON-GAAP GROSS MARGIN, LOSS FROM OPERATIONS TO NON-GAAP OPERATING LOSS AND OPERATING MARGIN TO NON-GAAP OPERATING MARGIN

(in thousands)

(unaudited)

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

2013

 

2014

 

2013

Revenue

$

76,373

 

 

$

54,856

 

 

$

263,568

 

 

$

185,129

 

Cost of revenue

23,497

 

 

15,488

 

 

77,684

 

 

53,548

 

Gross profit

$

52,876

 

 

$

39,368

 

 

$

185,884

 

 

$

131,581

 

Gross margin

69.2

%

 

71.8

%

 

70.5

%

 

71.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

76,373

 

 

$

54,856

 

 

$

263,568

 

 

$

185,129

 

Adjustments to revenue 1,2

455

 

 

 

 

455

 

 

169

 

Non-GAAP revenue

$

76,828

 

 

$

54,856

 

 

$

264,023

 

 

$

185,298

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

$

23,497

 

 

$

15,488

 

 

$

77,684

 

 

$

53,548

 

Adjustments to costs of revenue

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangible assets

(1,767

)

 

(313

)

 

(2,703

)

 

(1,252

)

Stock based compensation and employer-related taxes

(707

)

 

(746

)

 

(2,749

)

 

(2,324

)

Total adjustments to cost of revenue

(2,474

)

 

(1,059

)

 

(5,452

)

 

(3,576

)

Non-GAAP costs of revenue

21,023

 

 

14,429

 

 

72,232

 

 

49,972

 

Non-GAAP gross profit

$

55,805

 

 

$

40,427

 

 

$

191,791

 

 

$

135,326

 

Non-GAAP gross margin

72.6

%

 

73.7

%

 

72.6

%

 

73.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

$

(14,170

)

 

$

(7,843

)

 

$

(49,916

)

 

$

(33,992

)

Operating margin

(18.6

)%

 

(14.3

)%

 

(18.9

)%

 

(18.4

)%

Adjustments to loss from operations

 

 

 

 

 

 

 

 

 

 

 

Adjustments to revenue 1, 2

455

 

 

 

 

455

 

 

169

 

Stock-based compensation and employer-related taxes

9,255

 

 

6,870

 

 

34,356

 

 

22,009

 

Amortization of intangible assets

1,920

 

 

564

 

 

3,531

 

 

2,256

 

Acquisition costs 3

566

 

 

 

 

1,297

 

 

 

Total adjustments to loss from operations

12,196

 

 

7,434

 

 

39,639

 

 

24,434

 

Non-GAAP operating loss

$

(1,974

)

 

$

(409

)

 

$

(10,277

)

 

$

(9,558

)

Non-GAAP operating loss margin

(2.6

)%

 

(0.7

)%

 

(3.9

)%

 

(5.2

)%

 

1

 

Due to purchase accounting rules, upon acquisition of Evolv Inc., Cornerstone recorded an adjustment of $1.9 million to reduce the balance of deferred revenue related to the assumed client contracts acquired from Evolv Inc. As a result of this adjustment, $0.5 million of revenue was not recognized during both the three months and year ended December 31, 2014. Therefore, revenue is adjusted by an increase of $0.5 million to arrive at non-GAAP revenue for both the three months and year ended December 31, 2014.

2

 

Due to purchase accounting rules, upon acquisition of Sonar Limited, Cornerstone recorded an adjustment of $1.6 million to reduce the balance of deferred revenue related to the assumed client contracts acquired from Sonar Limited. As a result of this adjustment, $0.2 million of revenue was not recognized during the year ended December 31, 2013. Therefore, revenue is adjusted by an increase of $0.2 million to arrive at non-GAAP revenue for the year ended December 31, 2013.

3

 

Costs related to acquisition of Evolv Inc.

 

 

 

 

Cornerstone OnDemand, Inc.

RECONCILIATIONS OF NET LOSS TO NON-GAAP NET LOSS, NON-GAAP NET LOSS MARGIN AND NON-GAAP NET LOSS PER SHARE

(in thousands, except per share amounts)

(unaudited)

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

2013

 

2014

 

2013

Net loss

$

(18,166

)

 

$

(10,755

)

 

$

(64,899

)

 

$

(40,426

)

Net loss margin

(23.8

)%

 

(19.6

)%

 

(24.6

)%

 

(21.8

)%

Adjustments to net loss

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation and employer-related payroll taxes

9,255

 

 

6,870

 

 

34,356

 

 

22,009

 

Acquisition related:

 

 

 

 

 

 

 

 

 

 

 

Adjustments to revenue 1

455

 

 

 

 

455

 

 

169

 

Amortization of intangible assets

1,849

 

 

492

 

 

3,247

 

 

1,969

 

Adjustments for income tax provision (benefit) 2

 

 

(391

)

 

 

 

(742

)

Acquisition costs 3

566

 

 

 

 

1,297

 

 

 

Accretion of debt discount and amortization of debt issuance costs 4

2,107

 

 

2,005

 

 

8,274

 

 

4,272

 

Other amortization costs

71

 

 

72

 

 

284

 

 

287

 

Total adjustments to net loss

14,303

 

 

9,048

 

 

47,913

 

 

27,964

 

Non-GAAP net loss

$

(3,863

)

 

$

(1,707

)

 

$

(16,986

)

 

$

(12,462

)

Non-GAAP net loss margin

(5.0

)%

 

(3.1

)%

 

(6.4

)%

 

(6.7

)%

Weighted-average common shares outstanding, basic and diluted

53,660

 

 

52,185

 

 

53,267

 

 

51,427

 

Non-GAAP net loss per share

$

(0.07

)

 

$

(0.03

)

 

$

(0.32

)

 

$

(0.24

)

 

1

 

As of December 31, 2014, approximately $0.5 million in estimated revenue was not recognized during both the three months and year ended December 31, 2014, respectively, and $0.2 million for the year ended December 31, 2013, due to purchase accounting rules.

2

 

Income tax effects related to acquisition related adjustments for Sonar Limited.

3

 

Costs related to acquisition of Evolv Inc.

4

 

Debt discount accretion and debt issuance cost amortization has been recorded in connection with our issuance of $253.0 million in convertible notes on June 17, 2013. These expenses represent non-cash charges that have been recorded in accordance with the authoritative accounting literature for such transactions.

Cornerstone OnDemand, Inc.

CALCULATIONS OF BOOKINGS

(in thousands)

(unaudited)

 

 

Deferred Revenue Balance

 

Three Months Ended December 31, 2014

 

 

 

 

 

 

Revenue

 

 

 

$

76,373

 

Deferred revenue at September 30, 2014

$

153,467

 

 

 

 

Deferred revenue at December 31, 2014

191,336

 

 

 

 

Change in deferred revenue

37,869

 

 

37,869

 

Bookings

 

 

 

$

114,242

 

 

 

 

 

 

 

 

Deferred Revenue Balance

 

Three Months Ended December 31, 2013

 

 

 

 

 

 

Revenue

 

 

 

$

54,856

 

Deferred revenue at September 30, 2013

$

109,212

 

 

 

 

Deferred revenue at December 31, 2013

138,822

 

 

 

 

Change in deferred revenue

29,610

 

 

29,610

 

Bookings

 

 

 

$

84,466

 

 

 

 

 

 

 

Percentage period-over-period increase in bookings for the three months ended December 31, 2014

 

 

 

35

%

 

 

 

 

 

 

 

Deferred Revenue Balance

 

Year Ended     December 31, 2014

 

 

 

 

 

 

Revenue

 

 

 

$

263,568

 

Deferred revenue at December 31, 2013

$

138,822

 

 

 

 

Deferred revenue at December 31, 2014

191,336

 

 

 

 

Change in deferred revenue

52,514

 

 

52,514

 

Bookings

 

 

 

$

316,082

 

 

 

 

 

 

 

 

Deferred Revenue Balance

 

Year Ended     December 31, 2013

 

 

 

 

 

 

Revenue

 

 

 

$

185,129

 

Deferred revenue at December 31, 2012

$

92,252

 

 

 

 

Deferred revenue at December 31, 2013

138,822

 

 

 

 

Change in deferred revenue

46,570

 

 

46,570

 

Bookings

 

 

 

$

231,699

 

 

 

 

 

 

 

Percentage period-over-period increase in bookings for the year ended December 31, 2014

 

 

 

36

%

 

 

 

Cornerstone OnDemand, Inc.

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO NON-GAAP NET CASH PROVIDED BY OPERATING ACTIVITIES AND NON-GAAP NET CASH PROVIDED BY OPERATING ACTIVITIES MARGIN

(in thousands)

(unaudited)

 

 

Three Months Ended

 

Year Ended

 

December 31,

 

December 31,

 

2014

 

2013

 

2014

 

2013

Net cash provided by operating activities

$

44,440

 

 

$

19,495

 

 

$

33,009

 

 

$

17,431

 

Net cash provided by operating activities margin

58.2

%

 

35.5

%

 

12.5

%

 

9.4

%

Payment of acquisition related costs 1

431

 

 

 

 

444

 

 

 

Payment of employer related taxes from stock-based compensation

79

 

 

293

 

 

676

 

 

1,169

 

Purchased investment premium, net of amortization

(591

)

 

(1,000

)

 

(816

)

 

2,031

 

Non-GAAP net cash provided by operating activities

$

44,359

 

 

$

18,788

 

 

$

33,313

 

 

$

20,631

 

Non-GAAP net cash provided by operating activities margin

57.7

%

 

34.2

%

 

12.6

%

 

11.1

%

 

1

 

Costs paid during the three months and year ended December 31, 2014, related to acquisition of Evolv Inc.

 

 

 

 

 

 

 

Cornerstone OnDemand, Inc.

 

Investor Relations Contact:
Alexandra Geller
Cornerstone OnDemand
Phone: +1 (310) 752-1870
ageller@csod.com

or

Media Contact:
Elizabeth Flax
Cornerstone OnDemand
Phone: +1 (310) 752-1860
eflax@csod.com

Source: Cornerstone OnDemand

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