Fourth quarter revenue of $97.0 million, up 29% year-over-year.Fourth quarter calculated current billings was $125.0 million, representing a 28% increase year-over-year.Added 461 new enterprise platform customers and 52 net new six-figure enterprise platform customers in the fourth quarter.Full year revenue of $354.6 million, up 33% year-over-year.COLUMBIA, Md., Feb. 04, 2020 (GLOBE NEWSWIRE) — Tenable Holdings, Inc. (“Tenable”) (Nasdaq: TENB), the Cyber Exposure company, today announced financial results for the quarter and year ended December 31, 2019.“Q4 marked an end to a successful year,” said Amit Yoran, Chairman and CEO of Tenable. “We made great progress in the execution of our broader Cyber Exposure strategy with enhancements across our product portfolio and the launch of Lumin. We believe our investments in breadth of coverage, depth of analytics, prioritization and data science provide momentum heading into 2020 and will help us continue to transform how organizations manage and measure cyber risk.”Fourth Quarter 2019 Financial HighlightsRevenue was $97.0 million, representing a 29% increase year-over-year.Calculated current billings was $125.0 million, representing a 28% increase year-over-year.GAAP loss from operations was $27.6 million, compared to a loss of $19.6 million in the fourth quarter of 2018.Non-GAAP loss from operations was $11.1 million, compared to a loss of $10.8 million in the fourth quarter of 2018.GAAP net loss was $38.3 million, compared to a loss of $19.6 million in the fourth quarter of 2018.GAAP net loss per share was $0.39, compared to a loss of $0.21 in the fourth quarter of 2018.Non-GAAP net loss was $11.1 million, compared to a loss of $10.9 million in the fourth quarter of 2018.Pro forma non-GAAP net loss per share was $0.11, compared to a loss per share of $0.12 in the fourth quarter of 2018.Net cash used in operating activities was $3.1 million, compared to $1.6 million in the fourth quarter of 2018.Free cash flow was $(13.5) million, compared to $(3.1) million in the fourth quarter of 2018. Free cash flow in the fourth quarter of 2019 included $13.1 million of non-recurring payments related to the Indegy acquisition, $9.0 million of capital expenditures for our new headquarters, and a $3.8 million benefit related to employee stock purchase plan activity. Free cash flow in the fourth quarter of 2018 included a $4.0 million benefit related to employee stock purchase plan activity.Full Year 2019 Financial HighlightsRevenue was $354.6 million, representing a 33% increase year-over-year.Calculated current billings was $414.9 million, representing a 27% increase year-over-year.GAAP loss from operations was $90.8 million, compared to a loss of $72.6 million in 2018.Non-GAAP loss from operations was $42.8 million, compared to a loss of $49.1 million in 2018.GAAP net loss was $99.0 million, compared to a loss of $73.5 million in 2018.GAAP net loss per share was $1.03, compared to a loss of $1.38 in 2018.Non-GAAP net loss was $40.5 million, compared to a loss of $50.3 million in 2018.Pro forma non-GAAP net loss per share was $0.42, compared to a loss per share of $0.59 in 2018.Cash and cash equivalents and short-term investments were $212.3 million at December 31, 2019, compared to $283.2 million at December 31, 2018. The decrease in cash was primarily related to our acquisition of Indegy.Net cash used in operating activities was $10.7 million, compared to $2.6 million used in 2018.Free cash flow was $(31.4) million, compared to $(8.3) million in 2018. Free cash flow in 2019 included $13.1 million of non-recurring payments related to the Indegy acquisition, $11.4 million of capital expenditures for our new headquarters, and a $0.9 million reduction related to employee stock purchase plan activity. Free cash flow in 2018 included a $6.3 million benefit related to employee stock purchase plan activity.Fourth Quarter 2019 and Recent Business HighlightsAdded 461 new enterprise platform customers and 52 net new six-figure customers.Extended depth of operational technology (OT) expertise with the acquisition of Indegy to deliver a unified, risk-based platform for IT and OT security.Expanded LuminTM analytic capabilities with an assessment maturity score, which helps organizations move beyond vulnerability prioritization to actionable metrics and recommended actions based on security program maturity.Broadened cloud security capabilities with Microsoft Azure Security Center API integration and a new, integrated offering to secure cloud workloads with Golden Amazon Machine Images (AMIs) pipeline. Both integrations represent a critical step in ensuring that organizations of all sizes can build cybersecurity best practices directly into their multi or hybrid cloud strategies.Selected as the preferred vulnerability management partner for BeyondTrust Enterprise Vulnerability Management customers as it exits the vulnerability management market.Financial OutlookFor the first quarter of 2020, we currently expect:Revenue in the range of $100.0 million to $101.0 million.Non-GAAP loss from operations in the range of $18.0 million to $17.0 million.Non-GAAP net loss in the range of $19.0 million to $18.0 million.Non-GAAP net loss per share in the range of $0.19 to $0.18, assuming 98.7 million weighted average shares outstanding.For the year ending December 31, 2020, we currently expect:Revenue in the range of $435.0 million to $440.0 million.Calculated current billings in the range of $500.0 million to $510.0 million.Non-GAAP loss from operations in the range of $38.0 million to $33.0 million.Non-GAAP net loss in the range of $41.0 million to $36.0 million, assuming a provision for income taxes of $6.5 million.Non-GAAP net loss per share in the range of $0.41 to $0.36, assuming 100.1 million weighted average shares outstanding.Conference Call InformationTenable will host a conference call at 4:30 p.m. Eastern Time to discuss its financial results. The conference call can be accessed at 877-407-9716 (U.S.) and 201-493-6779 (international). A live webcast of the event will be available on the Tenable Investor Relations website at https://investors.tenable.com. A replay of the webcast will be available until February 18, 2020.About TenableTenable® is the Cyber Exposure company. Over 30,000 organizations around the globe rely on Tenable to understand and reduce cyber risk. As the creator of Nessus®, Tenable extended its expertise in vulnerabilities to deliver the world’s first platform to see and secure any digital asset on any computing platform. Tenable customers include more than 50 percent of the Fortune 500, more than 30 percent of the Global 2000, and large government agencies. Learn more at tenable.com.Contact InformationInvestor Relations
Andrea DiMarco
[email protected]Media Relations
Cayla Baker
[email protected]Forward-Looking StatementsThis press release includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, including statements regarding our future results of operations and financial position, business strategy and plans and objectives for future operations, are forward-looking statements and represent our views as of the date of this press release. The words “anticipate,” believe,” “continue,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of assumptions and risks and uncertainties, many of which involve factors or circumstances that are beyond our control that could affect our financial results. These risks and uncertainties are detailed in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2018, our Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 and other filings that we make from time to time with the SEC, which are available on the SEC’s website at sec.gov. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this press release may not occur and actual results could differ materially and adversely from those anticipated or implied in any forward-looking statements. Except as required by law, we are under no obligation to update these forward-looking statements subsequent to the date of this press release, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.Non-GAAP Financial Measures and Other Key MetricsTo supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may be different than similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects and allow for greater transparency with respect to important metrics used by management for financial and operational decision-making. We present these non-GAAP financial measures to assist investors in seeing our financial performance using a management view and because we believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the financial tables accompanying this press release.Calculated Current Billings: We define calculated current billings, a non-GAAP financial measure, as total revenue recognized in a period plus the change in current deferred revenue in the corresponding period. We believe that calculated current billings is a key metric to measure our periodic performance. Given that most of our customers pay in advance (including multi-year contracts), but we generally recognize the related revenue ratably over time, we use calculated current billings to measure and monitor our ability to provide our business with the working capital generated by upfront payments from our customers. We believe that calculated current billings, which excludes deferred revenue for periods beyond twelve months in a customer’s contractual term, more closely correlates with annual contract value and that the variability in total billings, depending on the timing of large multi-year contracts and the preference for annual billing versus multi-year upfront billing, may distort growth in one period over another.Free Cash Flow: We define free cash flow, a non-GAAP financial measure, as net cash (used in) provided by operating activities less purchases of property and equipment. We believe free cash flow is an important liquidity measure of the cash (if any) that is available, after purchases of property and equipment, for investment in our business and to make acquisitions. We believe that free cash flow is useful to investors as a liquidity measure because it measures our ability to generate or use cash.Non-GAAP Loss from Operations and Non-GAAP Operating Margin: We define these non-GAAP financial measures as their respective GAAP measures, excluding the effects of stock-based compensation, acquisition-related expenses and amortization of acquired intangible assets. Acquisition-related expenses include transaction expenses and costs related to the transfer of acquired intellectual property.Non-GAAP Net Loss, Non-GAAP Net Loss Per Share and Pro Forma Non-GAAP Net Loss Per Share: We define non-GAAP net loss as GAAP net loss attributable to common stockholders, excluding the effect of the accretion of Series A and B redeemable convertible preferred stock, stock-based compensation, acquisition-related expenses and amortization of acquired intangible assets, including the applicable tax impact. We use non-GAAP net loss to calculate non-GAAP net loss per share and pro forma non-GAAP net loss per share. Pro forma non-GAAP net loss per share is calculated by giving effect to the conversion of our redeemable convertible preferred stock into common stock as though the conversion occurred at the beginning of each period presented prior to 2019.Non-GAAP Gross Profit and Non-GAAP Gross Margin: We define non-GAAP gross profit as GAAP gross profit, excluding the effect of stock-based compensation and amortization of acquired intangible assets. Non-GAAP gross margin is defined as non-GAAP gross profit as a percentage of revenue.Non-GAAP Sales and Marketing Expense, Non-GAAP Research and Development Expense and Non-GAAP General and Administrative Expense: We define these non-GAAP measures as their respective GAAP measures, excluding stock-based compensation and acquisition-related expenses.
TENABLE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)_______________
(1) Includes stock-based compensation as follows:
TENABLE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
TENABLE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
TENABLE HOLDINGS, INC.
REVENUE COMPONENTS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(unaudited)_______________
(1) Recurring revenue, which includes revenue from subscription arrangements for software and cloud-based solutions and maintenance associated with perpetual licenses represented 93%, 90%, 92% and 89% of revenue for the three months ended December 31, 2019 and 2018 and the year ended December 31, 2019 and 2018, respectively._______________
(1) Deferred revenue (current), beginning of period for the three months and year ended December 31, 2019 includes $0.4 million related to Indegy’s deferred revenue at the acquisition date.________________
(1) Free cash flow in the three months and year ended December 31, 2019 included non-recurring cash payments totaling $13.1 million associated with the Indegy acquisition, including $6.7 million for income taxes on the transfer of acquired intellectual property, $3.1 million for other costs related to the intellectual property transfer, $1.8 million for the settlement of unvested acquiree equity awards, and $1.5 million for acquisition-related expenses. Capital expenditures related to our new headquarters in the three months and year ended December 31, 2019 were $9.0 million and $11.4 million, respectively. Contributions to our employee stock purchase plan during the three months ended December 31, 2019 and 2018 and year ended December 31, 2019 and 2018 impacted free cash flow by $3.8 million, $4.0 million, $(0.9) million and $6.3 million, respectively.
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(1) The tax impact of the acquisition includes $6.3 million of current tax expense and $4.3 million of deferred tax expense related to the transfer of acquired intellectual property.
(2) The tax impact of stock-based compensation is based on the tax treatment for applicable tax jurisdictions.
(3) The tax impact of amortization of acquired intangible assets is not material.
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