RALEIGH, N.C., Oct. 29,
2020 /PRNewswire/ -- Bandwidth Inc. (NASDAQ: BAND), a leading
enterprise cloud communications company, today announced financial
results for the third quarter ended September 30, 2020.
"We delivered our strongest quarter ever and are
raising our annual revenue outlook. The strength in our
business is fueled by our relentless focus on customer success and
highlighted by our robust dollar-based net retention. Our value
proposition is strong and our commitment to our mission and
customers will now expand across the globe," said David Morken, chief executive officer of
Bandwidth. "Looking ahead, I couldn't be more excited about our
opportunities as we unite Bandwidth's deep U.S. presence with
Voxbone's world-wide presence to create a global software platform,
network and team unlike any other."
Third Quarter 2020 Financial Highlights
- Revenue: Total revenue for the third quarter of 2020 was
$84.8 million, up 40% compared to
$60.5 million in the third quarter of
2019. Within total revenue, CPaaS revenue was $73.8 million, up 43% compared to $51.5 million for the third quarter of 2019.
Other revenue contributed the remaining $11.0 million for the third quarter of 2020.
Other revenue was $9.0 million in the
same period last year.
- Gross Profit: Gross profit for the third quarter of 2020
was $39.2 million, compared to
$27.4 million for the third quarter
of 2019. Gross margin for the third quarter of 2020 was 46%,
compared to 45% for the third quarter of 2019. Non-GAAP gross
profit for the third quarter of 2020 was $41.6 million, compared to $29.1 million for the third quarter of 2019.
Non-GAAP gross margin was 49% for the third quarter of 2020,
compared to 48% for the third quarter of 2019.
- Net (Loss): Net loss for the third quarter of 2020
was $(2.4) million, or $(0.10) per share, based on 24.2 million weighted
average shares outstanding. During the third quarter of 2019, net
loss was $(1.0) million, or
$(0.04) per share, based on 23.4
million weighted average shares outstanding.
- Non-GAAP Net Income (Loss): Non-GAAP net income for
the third quarter of 2020 was $6.5
million, or $0.24 per share,
based on 26.5 million weighted average diluted shares outstanding.
This compares to a Non-GAAP net loss of $(1.4) million, or $(0.06) per share, based on 23.4 million weighted
average shares outstanding for the third quarter of 2019.
- Adjusted EBITDA: Adjusted EBITDA was $9.3 million for the third quarter of 2020,
compared to $(0.6) million for the
third quarter of 2019.
Additional information regarding the non-GAAP financial measures
discussed in this release, including an explanation of these
measures and how each is calculated, is included below under the
heading "Non-GAAP Financial Measures." A reconciliation of GAAP to
non-GAAP financial measures has also been provided in the financial
tables included below.
Third Quarter 2020 Key Metrics
- The number of active CPaaS customers was 2,015 as of
September 30, 2020, an increase of
25% from 1,610 as of September 30,
2019.
- The dollar-based net retention rate was 131% during the third
quarter of 2020, compared to 116% during the third quarter of
2019.
Additional information regarding our active CPaaS customers and
dollar-based net retention rate and how each are calculated are
included below.
Financial Outlook
Bandwidth's outlook assumes current
business conditions, current foreign currency exchange rates and
the impact of the anticipated acquisition of Voxbone expected to
close on October 31, 2020.
Bandwidth is providing guidance for its fourth quarter and full
year 2020 as follows (guidance includes outlook for Voxbone from
November 1, 2020):
- Fourth Quarter 2020 Guidance: CPaaS revenue is expected
to be in the range of $84.3 million
to $84.8 million. Total revenue is
expected to be in the range of $96.5
million to $97.0 million.
Non-GAAP earnings per share is expected to be in the range of
$0.03 to $0.05 per share, using 27.5 million weighted
average diluted shares outstanding.
- Full Year 2020 Guidance: CPaaS revenue is expected to be
in the range of $284.3 million to
$284.8 million. Total revenue is
expected to be in the range of $326.6
million to $327.1 million.
Non-GAAP earnings per share is expected to be in the range of
$0.44 to $0.46 per share, using 25.8 million weighted
average diluted shares outstanding.
Bandwidth has not reconciled its fourth quarter and full-year
guidance related to non-GAAP net earnings or loss to GAAP net
earnings or loss and non-GAAP earnings or loss per share to GAAP
earnings or loss, because stock-based compensation cannot be
reasonably calculated or predicted at this time. Accordingly, a
reconciliation is not available without unreasonable effort.
Quarterly Conference Call
Bandwidth will host a conference call today at 5:00 p.m. Eastern Time to review the Company's
financial results for the third quarter ended September 30, 2020. To access this call, dial
(855) 327-6837 for the U.S. or Canada, or (631) 891-4304 for callers outside
the U.S. or Canada. A live webcast
of the conference call will be accessible from the Investors
section of Bandwidth's website at https://investors.bandwidth.com,
and a recording will be archived and accessible at
https://investors.bandwidth.com. An audio replay of this conference
call will also be available through November
5, 2020, by dialing (844) 512-2921 for the U.S. or
Canada, or (412) 317-6671 for
callers outside the U.S. or Canada, and entering passcode 10011373.
About Bandwidth Inc.
Bandwidth (NASDAQ: BAND) is a leading enterprise cloud
communications company. Companies like Google, Microsoft, Cisco,
Zoom and RingCentral use Bandwidth's APIs to easily embed voice,
messaging and 911 access into software and applications. Bandwidth
is the first and only CPaaS provider offering a robust selection of
communications APIs built around their own nationwide IP voice
network - one of the largest in the nation. More information
available at www.bandwidth.com.
Forward-Looking Statements
This press release includes forward-looking statements. All
statements contained in this press release other than statements of
historical facts, including, without limitation, statements
regarding our ability to consummate the acquisition with Voxbone,
future financial and business performance for the fourth quarter
2020 and full-year 2020, attractiveness of our product offerings
and platform and the value proposition of our products, are
forward-looking statements. The words "anticipate," "believe,"
"continue," "estimate," "expect," "intend," "guide," "may," "will"
and similar expressions and their negatives are intended to
identify forward-looking statements. We have based these
forward-looking statements largely 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 risks and uncertainties, including,
without limitation, our ability to consummate the acquisition with
Voxbone, risks related to our rapid growth and ability to sustain
our revenue growth rate, competition in the markets in which we
operate, market growth, our ability to innovate and manage our
growth, our ability to expand effectively into new markets, our
ability to operate in compliance with applicable laws as well as
other risks and uncertainties set forth in the "Risk Factors"
section of our Form 10-K for the year ended December 31, 2019, filed with the Securities and
Exchange Commission and any subsequent reports that we file with
the Securities and Exchange Commission after December 31, 2019. 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, we cannot guarantee future
results, levels of activity, performance, achievements or events
and circumstances reflected in the forward-looking statements will
occur. We are under no obligation to update any of these
forward-looking statements after the date of this press release to
conform these statements to actual results or revised expectations,
except as required by law. You should, therefore, not rely on these
forward-looking statements as representing our views as of any date
subsequent to the date of this press release.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are
prepared and presented in accordance with Generally Accepted
Accounting Principles in the United
States, or GAAP, we provide investors with certain non-GAAP
financial measures and other business metrics, which we believe are
helpful to our investors. We use these Non-GAAP financial measures
and other business metrics for financial and operational
decision-making purposes and as a means to evaluate
period-to-period comparisons. We believe that these Non-GAAP
financial measures and other business metrics provide useful
information about our operating results, enhance the overall
understanding of past financial performance and future prospects
and allow for greater transparency with respect to metrics used by
our management in its financial and operational
decision-making.
The presentation of Non-GAAP financial information and other
business metrics is not meant to be considered in isolation or as a
substitute for the directly comparable financial measures prepared
in accordance with GAAP. While our Non-GAAP financial measures and
other business metrics are an important tool for financial and
operational decision-making and for evaluating our own operating
results over different periods of time, we urge investors to review
the reconciliation of these financial measures to the comparable
GAAP financial measures included above, and not to rely on any
single financial measure to evaluate our business.
We define Non-GAAP gross profit as gross profit after adding
back depreciation and amortization and stock-based compensation. We
add back depreciation and amortization and stock-based compensation
because they are non-cash items. We eliminate the impact of these
non-cash items, because we do not consider them indicative of our
core operating performance. Their exclusion facilitates comparisons
of our operating performance on a period-to-period basis.
Therefore, we believe that showing gross margin, as adjusted to
remove the impact of these non-cash expenses, such as depreciation,
amortization and stock-based compensation, is helpful to investors
in assessing our gross profit and gross margin performance in a way
that is similar to how management assesses our performance. We
calculate Non-GAAP gross margin by dividing adjusted gross profit
by revenue, expressed as a percentage of revenue.
We define Non-GAAP net (loss) income as net (loss) income
adjusted for certain items affecting period to period
comparability. Non-GAAP net (loss) income excludes stock-based
compensation, amortization of acquired intangible assets related to
the Dash acquisition, amortization of debt discount and issuance
costs for convertible debt, acquisition related expenses,
impairment charges of intangibles assets, loss (gain) on disposal
of property and equipment, estimated tax impact of above
adjustments, income tax (benefit) provision resulting from excess
tax benefits associated with the exercise of stock options, vesting
of restricted stock units and equity compensation, and expense
resulting from recording the valuation allowance on our deferred
tax assets ("DTA").
We define adjusted EBITDA as net (loss) income adjusted to
reflect the addition or elimination of certain statement of
operations items including, but not limited to: income tax
(benefit) provision, interest (income) expense, net, depreciation
and amortization expense, acquisition related expenses, stock-based
compensation expense, impairment of intangible assets, and loss
(gain) from disposal of property and equipment. We have presented
Adjusted EBITDA because it is a key measure used by our management
and board of directors to understand and evaluate our core
operating performance and trends, generate future operating plans,
and make strategic decisions regarding the allocation of capital.
In particular, we believe that the exclusion of certain items in
calculating Adjusted EBITDA can produce a useful measure for
period-to-period comparisons of our business.
We define free cash flow as net cash provided by or used in
operating activities less net cash used in the acquisition of
property, plant and equipment activities and capitalized
development costs for software for internal use. We believe free
cash flow is a useful indicator of liquidity and provides
information to management and investors about the amount of cash
generated from our core operations that can be used for investing
in our business. Free cash flow has certain limitations in that it
does not represent the total increase or decrease in the cash
balance for the period, it does not take into consideration
investment in long-term securities, nor does it represent the
residual cash flows available for discretionary expenditures.
Therefore, it is important to evaluate free cash flow along with
our consolidated statements of cash flows.
We believe that these Non-GAAP financial measures provide useful
information about our operating results, enhance the overall
understanding of past financial performance and future prospects
and allow for greater transparency with respect to metrics used by
our management in its financial and operational
decision-making.
While a reconciliation of Non-GAAP guidance measures to
corresponding GAAP measures is not available on a forward-looking
basis as a result of the uncertainty regarding, and the potential
variability of, many of these costs and expenses that we may incur
in the future, we have provided a reconciliation of Non-GAAP
financial measures and other business metrics to the nearest
comparable GAAP measures in the accompanying financial statement
tables included in this press release.
We define an active CPaaS customer account at the end of any
period as an individual account, as identified by a unique account
identifier, for which we have recognized at least $100 of revenue in the last month of the period.
We believe that the use of our platform by active CPaaS customer
accounts at or above the $100 per
month threshold is a stronger indicator of potential future
engagement than trial usage of our platform at levels below
$100 per month. A single organization
may constitute multiple unique active CPaaS customer accounts if it
has multiple unique account identifiers, each of which is treated
as a separate active CPaaS customer account.
Our dollar-based net retention rate compares the CPaaS revenue
from customers in a quarter to the same quarter in the prior year.
To calculate the dollar-based net retention rate, we first identify
the cohort of customers that generate CPaaS revenue and that were
customers in the same quarter of the prior year. The dollar-based
net retention rate is obtained by dividing the CPaaS revenue
generated from that cohort in a quarter, by the CPaaS revenue
generated from that same cohort in the corresponding quarter in the
prior year. When we calculate dollar-based net retention rate for
periods longer than one quarter, we use the average of the
quarterly dollar-based net retention rates for the quarters in such
period.
BANDWIDTH INC.
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Revenue
|
$
|
60,491
|
|
|
$
|
84,758
|
|
|
$
|
170,591
|
|
|
$
|
230,066
|
|
Cost of
revenue
|
33,104
|
|
|
45,527
|
|
|
91,980
|
|
|
123,895
|
|
Gross
profit
|
27,387
|
|
|
39,231
|
|
|
78,611
|
|
|
106,171
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
7,939
|
|
|
10,232
|
|
|
23,312
|
|
|
29,316
|
|
Sales and
marketing
|
8,784
|
|
|
9,001
|
|
|
25,647
|
|
|
27,073
|
|
General and
administrative
|
15,269
|
|
|
18,134
|
|
|
43,884
|
|
|
51,070
|
|
Total operating
expenses
|
31,992
|
|
|
37,367
|
|
|
92,843
|
|
|
107,459
|
|
Operating (loss)
income
|
(4,605)
|
|
|
1,864
|
|
|
(14,232)
|
|
|
(1,288)
|
|
Other income
(expense), net
|
781
|
|
|
(4,206)
|
|
|
1,711
|
|
|
(8,980)
|
|
Loss before income
taxes
|
(3,824)
|
|
|
(2,342)
|
|
|
(12,521)
|
|
|
(10,268)
|
|
Income tax benefit
(provision)
|
2,810
|
|
|
(10)
|
|
|
16,971
|
|
|
(13,783)
|
|
Net (loss)
income
|
$
|
(1,014)
|
|
|
$
|
(2,352)
|
|
|
$
|
4,450
|
|
|
$
|
(24,051)
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Net (loss) income per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.04)
|
|
|
$
|
(0.10)
|
|
|
$
|
0.20
|
|
|
$
|
(1.01)
|
|
Diluted
|
$
|
(0.04)
|
|
|
$
|
(0.10)
|
|
|
$
|
0.19
|
|
|
$
|
(1.01)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
23,426,455
|
|
|
24,175,762
|
|
|
22,353,097
|
|
|
23,905,322
|
|
Diluted
|
23,426,455
|
|
|
24,175,762
|
|
|
23,692,571
|
|
|
23,905,322
|
|
The Company
recognized total stock-based compensation expense as
follows:
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Cost of
revenue
|
$
|
52
|
|
|
$
|
46
|
|
|
$
|
158
|
|
|
$
|
161
|
|
Research and
development
|
371
|
|
|
508
|
|
|
1,101
|
|
|
1,581
|
|
Sales and
marketing
|
280
|
|
|
369
|
|
|
892
|
|
|
1,140
|
|
General and
administrative
|
951
|
|
|
1,459
|
|
|
2,809
|
|
|
4,424
|
|
Total
|
$
|
1,654
|
|
|
$
|
2,382
|
|
|
$
|
4,960
|
|
|
$
|
7,306
|
|
BANDWIDTH INC.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
|
|
|
As of December
31,
|
|
As of September
30,
|
|
2019
|
|
2020
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
184,414
|
|
|
$
|
300,179
|
|
Restricted
cash
|
590
|
|
|
1,144
|
|
Other
investments
|
—
|
|
|
230,780
|
|
Accounts receivable,
net of allowance for doubtful accounts
|
30,187
|
|
|
46,452
|
|
Prepaid expenses and
other current assets
|
9,260
|
|
|
10,022
|
|
Deferred
costs
|
2,498
|
|
|
2,238
|
|
Total current
assets
|
226,949
|
|
|
590,815
|
|
Property and
equipment, net
|
41,654
|
|
|
43,926
|
|
Operating
right-of-use asset
|
21,031
|
|
|
17,509
|
|
Intangible assets,
net
|
6,569
|
|
|
6,179
|
|
Deferred costs,
non-current
|
1,952
|
|
|
3,412
|
|
Other long-term
assets
|
1,533
|
|
|
1,724
|
|
Goodwill
|
6,867
|
|
|
6,867
|
|
Deferred tax
asset
|
34,861
|
|
|
—
|
|
Total
assets
|
$
|
341,416
|
|
|
$
|
670,432
|
|
Liabilities and
stockholders' equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
4,190
|
|
|
$
|
7,776
|
|
Accrued expenses and
other current liabilities
|
27,328
|
|
|
34,360
|
|
Current portion of
deferred revenue
|
5,177
|
|
|
5,527
|
|
Advanced
billings
|
4,167
|
|
|
5,016
|
|
Operating lease
liability, current
|
4,876
|
|
|
5,162
|
|
Total current
liabilities
|
45,738
|
|
|
57,841
|
|
Operating lease
liability, net of current portion
|
19,868
|
|
|
15,638
|
|
Deferred revenue, net
of current portion
|
5,720
|
|
|
6,331
|
|
Convertible senior
notes
|
—
|
|
|
277,483
|
|
Total
liabilities
|
71,326
|
|
|
357,293
|
|
Stockholders'
equity:
|
|
|
|
Class A and Class B
common stock
|
24
|
|
|
24
|
|
Additional paid-in
capital
|
275,553
|
|
|
342,633
|
|
Accumulated
deficit
|
(5,528)
|
|
|
(29,579)
|
|
Accumulated other
comprehensive income
|
41
|
|
|
61
|
|
Total stockholders'
equity
|
270,090
|
|
|
313,139
|
|
Total liabilities and
stockholders' equity
|
$
|
341,416
|
|
|
$
|
670,432
|
|
BANDWIDTH INC.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
|
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
Cash flows from
operating activities
|
|
|
|
Net income
(loss)
|
$
|
4,450
|
|
|
$
|
(24,051)
|
|
Adjustments to
reconcile net income (loss) to net cash (used in) provided by
operating activities
|
|
|
|
Depreciation and
amortization
|
6,628
|
|
|
9,927
|
|
Right-of-use asset
amortization
|
3,126
|
|
|
3,522
|
|
Accretion of bond
discount
|
(700)
|
|
|
—
|
|
Gain on sale of
marketable securities
|
(4)
|
|
|
—
|
|
Amortization of debt
discount and issuance costs
|
159
|
|
|
10,916
|
|
Stock-based
compensation
|
4,960
|
|
|
7,306
|
|
Deferred
taxes
|
(17,091)
|
|
|
14,254
|
|
Loss on disposal of
property and equipment
|
354
|
|
|
263
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts receivable,
net of allowances
|
(5,304)
|
|
|
(16,218)
|
|
Prepaid expenses and
other assets
|
(3,046)
|
|
|
(1,024)
|
|
Deferred
costs
|
(42)
|
|
|
(1,200)
|
|
Accounts
payable
|
(169)
|
|
|
2,905
|
|
Accrued expenses and
other liabilities
|
4,696
|
|
|
6,865
|
|
Deferred revenue and
advanced billings
|
985
|
|
|
1,810
|
|
Operating right-of-use
liability
|
(2,482)
|
|
|
(3,944)
|
|
Net cash (used in)
provided by operating activities
|
(3,480)
|
|
|
11,331
|
|
Cash flows from
investing activities
|
|
|
|
Purchase of property
and equipment
|
(13,088)
|
|
|
(9,536)
|
|
Capitalized software
development costs
|
(2,749)
|
|
|
(1,846)
|
|
Purchase of
marketable securities
|
(68,361)
|
|
|
—
|
|
Proceeds from sales
and maturities of marketable securities
|
86,468
|
|
|
—
|
|
Purchase of other
investments
|
—
|
|
|
(230,780)
|
|
Net cash provided by
(used in) investing activities
|
2,270
|
|
|
(242,162)
|
|
Cash flows from
financing activities
|
|
|
|
Proceeds from the
follow-on public offering, net of underwriting discounts
|
147,391
|
|
|
—
|
|
Payment of costs
related to the follow-on public offering
|
(757)
|
|
|
—
|
|
Proceeds from
issuance of convertible senior notes
|
—
|
|
|
400,000
|
|
Payment of debt
issuance costs
|
(142)
|
|
|
(11,965)
|
|
Purchase of capped
call
|
—
|
|
|
(43,320)
|
|
Proceeds from
exercises of stock options
|
7,249
|
|
|
3,859
|
|
Value of equity
awards withheld for tax liabilities
|
(1,212)
|
|
|
(1,472)
|
|
Net cash provided by
financing activities
|
152,529
|
|
|
347,102
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(19)
|
|
|
48
|
|
Net increase in cash,
cash equivalents, and restricted cash
|
151,300
|
|
|
116,319
|
|
Cash, cash
equivalents, and restricted cash, beginning of period
|
41,501
|
|
|
185,004
|
|
Cash, cash
equivalents, and restricted cash, end of period
|
$
|
192,801
|
|
|
$
|
301,323
|
|
|
|
|
|
BANDWIDTH INC.
Reconciliation of Non-GAAP Financial Measures
(In thousands, except share and per share amounts)
(Unaudited)
|
|
Non-GAAP Gross
Profit and Non-GAAP Gross Margin
|
|
Consolidated
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
|
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
|
|
|
Consolidated Gross
Profit
|
$
|
27,387
|
|
|
$
|
39,231
|
|
|
$
|
78,611
|
|
|
$
|
106,171
|
|
|
|
|
|
Consolidated Gross
Profit Margin %
|
45
|
%
|
|
46
|
%
|
|
46
|
%
|
|
46
|
%
|
|
|
|
|
Depreciation
|
1,700
|
|
|
2,284
|
|
|
4,523
|
|
|
6,958
|
|
|
|
|
|
Stock-based
compensation
|
52
|
|
|
46
|
|
|
158
|
|
|
161
|
|
|
|
|
|
Non-GAAP Gross
Profit
|
$
|
29,139
|
|
|
$
|
41,561
|
|
|
$
|
83,292
|
|
|
$
|
113,290
|
|
|
|
|
|
Non-GAAP Gross
Margin %
|
48
|
%
|
|
49
|
%
|
|
49
|
%
|
|
49
|
%
|
|
|
|
|
By
Segment
|
|
CPaaS
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
CPaaS Gross
Profit
|
$
|
22,202
|
|
|
$
|
34,416
|
|
|
$
|
63,431
|
|
|
$
|
91,492
|
|
CPaaS Gross Profit
Margin %
|
43
|
%
|
|
47
|
%
|
|
44
|
%
|
|
46
|
%
|
Depreciation
|
1,700
|
|
|
2,284
|
|
|
4,523
|
|
|
6,958
|
|
Stock-based
compensation
|
52
|
|
|
46
|
|
|
158
|
|
|
161
|
|
Non-GAAP CPaaS
Gross Profit
|
$
|
23,954
|
|
|
$
|
36,746
|
|
|
$
|
68,112
|
|
|
$
|
98,611
|
|
Non-GAAP CPaaS
Gross Margin %
|
47
|
%
|
|
50
|
%
|
|
47
|
%
|
|
49
|
%
|
|
Other
|
|
There are no non-GAAP
adjustments to gross profit for the Other segment.
|
BANDWIDTH INC.
Reconciliation of Non-GAAP Financial Measures
(In thousands, except share and per share amounts)
(Unaudited)
|
|
|
Non-GAAP Net
(Loss) Income
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
|
|
|
|
|
|
|
|
Net (loss)
income
|
$
|
(1,014)
|
|
|
$
|
(2,352)
|
|
|
$
|
4,450
|
|
|
$
|
(24,051)
|
|
Stock-based
compensation
|
1,654
|
|
|
2,382
|
|
|
4,960
|
|
|
7,306
|
|
Amortization of
acquired intangibles
|
130
|
|
|
130
|
|
|
390
|
|
|
390
|
|
Amortization of debt
discount and issuance
costs for convertible debt
|
—
|
|
|
4,575
|
|
|
—
|
|
|
10,852
|
|
Acquisition-related
expenses
|
—
|
|
|
1,745
|
|
|
—
|
|
|
1,745
|
|
Loss on disposal of
property and equipment
|
3
|
|
|
3
|
|
|
354
|
|
|
263
|
|
Estimated tax effects
of adjustments (1)
|
(451)
|
|
|
—
|
|
|
(1,440)
|
|
|
—
|
|
Valuation allowance
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
14,173
|
|
Income tax benefit of
equity compensation
|
(1,749)
|
|
|
—
|
|
|
(13,488)
|
|
|
—
|
|
Non-GAAP net
(loss) income
|
$
|
(1,427)
|
|
|
$
|
6,483
|
|
|
$
|
(4,774)
|
|
|
$
|
10,678
|
|
|
|
|
|
|
|
|
|
Net (loss) income
per share
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.04)
|
|
|
$
|
(0.10)
|
|
|
$
|
0.20
|
|
|
$
|
(1.01)
|
|
Diluted
|
$
|
(0.04)
|
|
|
$
|
(0.10)
|
|
|
$
|
0.19
|
|
|
$
|
(1.01)
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
(loss) income per Non-GAAP share
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.06)
|
|
|
$
|
0.27
|
|
|
$
|
(0.21)
|
|
|
$
|
0.45
|
|
Diluted
|
$
|
(0.06)
|
|
|
$
|
0.24
|
|
|
$
|
(0.21)
|
|
|
$
|
0.42
|
|
|
|
|
|
|
|
|
|
Non-GAAP weighted
average number of
shares outstanding
|
|
|
|
|
|
|
|
Non-GAAP basic
shares
|
23,426,455
|
|
|
24,175,762
|
|
|
22,353,097
|
|
|
23,905,322
|
|
Convertible debt
conversion
|
—
|
|
|
1,692,546
|
|
|
—
|
|
|
708,073
|
|
Stock options issued
and outstanding
|
—
|
|
|
273,681
|
|
|
—
|
|
|
507,530
|
|
Nonvested RSUs
outstanding
|
—
|
|
|
367,790
|
|
|
—
|
|
|
333,329
|
|
Non-GAAP diluted
shares
|
23,426,455
|
|
|
26,509,779
|
|
|
22,353,097
|
|
|
25,454,254
|
|
________________________
|
(1)
|
The Non-GAAP
tax-effect is determined using a blended rate of statutory tax
rates in the jurisdictions where the Company has
tax filings. When the Company has a valuation allowance
recorded and no tax benefits will be recognized, the rate is
considered
to be zero. The rate was 25.2% for the three and nine months ended
September 30, 2019.
|
(2)
|
The company
recognized a tax expense of $0 and $14,173 to record a valuation
allowance on U.S. deferred tax assets in the three
and nine months ended September 30, 2020.
|
BANDWIDTH INC.
Reconciliation of Non-GAAP Financial Measures
(In thousands, except share and per share amounts)
(Unaudited)
|
|
Adjusted
EBITDA
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Net (loss)
income
|
$
|
(1,014)
|
|
|
$
|
(2,352)
|
|
|
$
|
4,450
|
|
|
$
|
(24,051)
|
|
Income tax (benefit)
provision (1) (2)
|
(2,810)
|
|
|
10
|
|
|
(16,971)
|
|
|
13,783
|
|
Interest (income)
expense, net
|
(778)
|
|
|
4,200
|
|
|
(1,698)
|
|
|
8,923
|
|
Depreciation
|
2,177
|
|
|
3,157
|
|
|
6,238
|
|
|
9,537
|
|
Amortization
|
130
|
|
|
130
|
|
|
390
|
|
|
390
|
|
Acquisition-related
expenses
|
—
|
|
|
1,745
|
|
|
—
|
|
|
1,745
|
|
Stock-based
compensation
|
1,654
|
|
|
2,382
|
|
|
4,960
|
|
|
7,306
|
|
Loss on disposal of
property and equipment
|
3
|
|
|
3
|
|
|
354
|
|
|
263
|
|
Adjusted
EBITDA
|
$
|
(638)
|
|
|
$
|
9,275
|
|
|
$
|
(2,277)
|
|
|
$
|
17,896
|
|
________________________
|
(1)
|
Includes excess tax
benefits (reversals) associated with the exercise of stock options
and vesting of restricted stock units of $1,749
and $13,488 in the three and nine months ended September 30, 2019,
respectively, and $0 in the three and nine months ended
September 30, 2020, respectively.
|
(2)
|
Includes $0 and
$14,173 of tax expense to record a valuation allowance on U.S.
deferred tax assets in the three and nine months
ended September 30, 2020.
|
Free Cash
Flow
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2019
|
|
2020
|
|
2019
|
|
2020
|
Net cash provided by
(used in) operating activities
|
$
|
1,932
|
|
|
$
|
11,647
|
|
|
$
|
(3,480)
|
|
|
$
|
11,331
|
|
Net cash used in
investing in capital assets (1)
|
(6,318)
|
|
|
(2,334)
|
|
|
(15,837)
|
|
|
(11,382)
|
|
Free cash
flow
|
$
|
(4,386)
|
|
|
$
|
9,313
|
|
|
$
|
(19,317)
|
|
|
$
|
(51)
|
|
________________________
|
(1)
|
Represents the
acquisition cost of property, equipment and capitalized development
costs for software for internal use.
|
View original
content:http://www.prnewswire.com/news-releases/bandwidth-announces-third-quarter-2020-financial-results-301163298.html
SOURCE Bandwidth Inc.