Imperva, Inc. (NASDAQ: IMPV), a leading global provider of
best-in-class cybersecurity solutions on-premises, in the cloud,
and across hybrid environments, today announced preliminary
financial results for the third quarter ended September 30,
2018.
Based on preliminary financial information, Imperva currently
expects to report total revenue for the third quarter of 2018 in
the range of $90.0 million to $92.0 million. Imperva also expects
to report billings in the third quarter of 2018 in the range of
$103.0 million to $105.0 million.
Imperva expects to report non-GAAP operating income in the third
quarter of 2018 in the range of $8.0 million to
$10.0 million, and expects to report non-GAAP net income per
share in the range of $0.20 to $0.25 using approximately 35.7
million weighted average shares, based on preliminary financial
information. Preliminary non-GAAP operating income and non-GAAP net
income per share results exclude stock-based compensation,
amortization of purchased intangibles, acquisition-related expense,
and facility exit costs. Imperva will provide detail on these
excluded items when it releases full financial results for the
third quarter of 2018. Imperva also expects to report that it ended
the third quarter of 2018 with approximately $305 million in cash,
cash equivalents, and short-term investments, and no debt on the
balance sheet.
Third quarter 2018 preliminary results are subject to change
based on the completion of Imperva’s normal quarter-end review
process.
In addition, Imperva today announced it entered into a
definitive agreement to be acquired by leading private equity
technology investment firm Thoma Bravo, LLC. As a result, Imperva
does not plan to host an earnings conference call to discuss
financial results and the previously announced financial analyst
and investor day will be cancelled.
Non-GAAP Financial Measures
Imperva reports all financial information required in accordance
with U.S. generally accepted accounting principles (GAAP). To
supplement Imperva’s unaudited condensed consolidated financial
statements presented in accordance with GAAP, Imperva uses certain
non-GAAP measures of financial performance. The presentation of
these non-GAAP financial measures is not intended to be considered
in isolation from, as a substitute for, or superior to, the
financial information prepared and presented in accordance with
GAAP, and may be different from non-GAAP financial measures used by
other companies. In addition, these non-GAAP measures have
limitations in that they do not reflect all of the amounts
associated with the results of Imperva’s operations as determined
in accordance with GAAP.
The non-GAAP financial measures used by Imperva include
billings, non-GAAP operating income and non-GAAP basic and diluted
income per share. These non-GAAP financial measures exclude
stock-based compensation, amortization of purchased intangibles,
acquisition-related expenses, and facility exit costs. Billings
include the change in deferred revenue, excluding the impact of any
deferred revenue balances acquired from business combination(s)
during the period.
Imperva expects the change in deferred revenue for the three
months ended September 30, 2018, excluding the impact of the
deferred revenue balance acquired from Prevoty, to be approximately
$13.0 million.
Imperva believes it is appropriate to exclude or give effect to
certain items in its non-GAAP financial measures for the following
reasons:
Stock-based Compensation. When evaluating the performance
of its consolidated results, Imperva does not consider stock-based
compensation expense. Likewise, the Imperva management team
excludes stock-based compensation expense from its operating plans.
In contrast, the Imperva management team is held accountable for
cash-based compensation and such amounts are included in its
operating plans. Further, when considering the impact of equity
award grants, Imperva places a greater emphasis on overall
stockholder dilution rather than the accounting charges associated
with such grants.
Imperva excludes stock-based compensation expense from
its non-GAAP financial measures primarily because it does
not consider such expense as part of its ongoing operating results
when assessing the performance of its business, and the exclusion
of the expense facilitates the comparison of current period results
with results from prior periods.
Amortization of Purchased Intangibles. When analyzing the
operating performance of an acquired entity, Imperva’s management
focuses on the total return provided by the investment (i.e.,
operating profit generated from the acquired entity as compared to
the purchase price paid) without taking into consideration any
allocations made for accounting purposes. Because the purchase
price for an acquisition necessarily reflects the accounting value
assigned to intangible assets (including acquired technology and
goodwill), when analyzing the operating performance of an
acquisition in subsequent periods, Imperva’s management excludes
the GAAP impact of acquired intangible assets to its financial
results. Imperva believes that such an approach is useful in
understanding the long-term return provided by an acquisition and
that investors benefit from a supplemental non-GAAP financial
measure that excludes the accounting expense associated with
acquired intangible assets.
In addition, in accordance with GAAP, Imperva generally
recognizes expense for internally-developed intangible assets as
they are incurred until technological feasibility is reached,
notwithstanding the potential future benefit such assets may
provide. Unlike internally-developed intangible assets, however,
and also in accordance with GAAP, Imperva generally capitalizes the
cost of acquired intangible assets and recognizes that cost as an
expense over the useful lives of the assets acquired (other than
goodwill, which is not amortized, as required under GAAP). As a
result of their GAAP treatment, there is an inherent lack of
comparability between the financial performance of
internally-developed intangible assets and acquired intangible
assets. Accordingly, Imperva believes it is useful to provide, as a
supplement to its GAAP operating results, a non-GAAP financial
measure that excludes the amortization of acquired intangibles.
Acquisition-related Expense. Imperva completed the
acquisition of Prevoty during the third quarter of 2018 and also
announced today that it entered into a definitive agreement to be
acquired by Thoma Bravo, LLC. Imperva has incurred legal,
accounting, advisory and other transaction-related expense in
connection with these transaction and excluded the associated
acquisition-related expenses from its non-GAAP financial measures
because they are not representative of ongoing operating costs.
Imperva does engage in acquisitions on a predictable cycle and the
expenses from these transactions vary significantly and are unique
to each transaction. Imperva records acquisition-related expense as
operating expense when incurred. As a result, when they occur,
these expenses affect comparability from period to period and
Imperva believes that investors benefit from a
supplemental non-GAAP financial measure that excludes
these expenses to facilitate the comparison of current period
results with the results from prior periods.
Facility Exit Costs. In September 2018, Imperva exited and
subleased a portion of its facilities located in Redwood Shores,
California and recorded charges in connection with the exit. These
charges are not representative of ongoing costs to the business as
they were part of a site consolidation plan that has been completed
and is not expected to recur. As a result, these charges are being
excluded to provide investors with a more comparable measure of
costs associated with ongoing operations.
Billings. Imperva believes giving effect to the change in
deferred revenue for the period, while excluding the impact of any
deferred revenue balances acquired from business combination(s)
during the period provides management and investors with important
information about the health of the business particularly as sales
of subscription and support services and related renewals grow.
Imperva has not provided a reconciliation of non-GAAP operating
income and non-GAAP net income per share to their comparable GAAP
financial measures because it could not produce the corresponding
GAAP financial measures by the date of this press release without
unreasonable effort. GAAP results and a detailed reconciliation of
each non-GAAP financial measure to the most directly comparable
GAAP financial measure will be presented in connection with
Imperva’s press release reporting full financial results for the
third quarter of 2018.
Forward-Looking Statements
This press release contains forward-looking statements,
including those regarding Imperva’s third quarter 2018 revenue,
billings, non-GAAP operating income and non-GAAP net income per
share results. These forward-looking statements are subject to
material risks and uncertainties that may cause actual results to
differ substantially from expectations. Investors should consider
important risk factors, which include that the financial results
presented in this press release are preliminary and may change upon
Imperva’s completion of the financial closing and quarter end
review process; and the other risks detailed under the caption
“Risk Factors” in our Quarterly Report on Form 10-Q filed with
the Securities and Exchange Commission, or the SEC, on August 3,
2018; and the other risks detailed in our other SEC filings. You
can obtain copies of Imperva’s SEC filings on the SEC’s website at
www.sec.gov.
The foregoing information represents Imperva’s outlook only as
of the date of this press release, and Imperva undertakes no
obligation to update or revise any forward-looking statements,
whether as a result of new information, new developments or
otherwise.
About Imperva
Imperva® is a leading cybersecurity company that delivers
best-in-class solutions to protect data and applications – wherever
they reside – on-premises, in the cloud, and across hybrid
environments. The company’s Incapsula, SecureSphere, and
CounterBreach product lines help organizations protect websites,
applications, APIs, and databases from cyberattacks while ensuring
compliance. Imperva innovates using data, analytics, and insights
from our experts and our community to deliver simple, effective and
enduring solutions that protect our customers from cybercriminals.
Learn more at www.imperva.com, our blog, or Twitter.
© 2018 Imperva, Inc. All rights reserved. Imperva, the Imperva
logo, CounterBreach, Incapsula, SecureSphere, ThreatRadar,
Camouflage along with its design, and Prevoty are trademarks of
Imperva, Inc. and its subsidiaries.
Additional Information and Where to Find It
In connection with Imperva’s proposed acquisition transaction,
Imperva will file relevant materials with the SEC, including a
preliminary and definitive proxy statement. Promptly after filing
the definitive proxy statement, Imperva will mail the definitive
proxy statement and a proxy card to Imperva’s stockholders.
These documents, as they may be amended or supplemented from
time to time, will contain important information about the proposed
transaction and Imperva stockholders are urged to read them
carefully when they become available. Imperva stockholders will
be able to obtain copies of the definitive proxy statement, the
preliminary proxy statement and other relevant materials in
connection with the transaction (when they become available) free
of charge at the SEC’s website at www.sec.gov or at
www.imperva.com/company/SECFilings.
Participants in the Solicitation
Under SEC rules, Imperva’s directors, executive officers and
other members of management and employees may be deemed to be
participants in the solicitation of proxies of Imperva stockholders
in connection with the proposed transaction. Information about
Imperva’s directors and executive officers and their ownership of
Imperva common stock is set forth in Imperva’s proxy statement
filed with the SEC on March 12, 2018. The proxy statement is
available free of charge at the SEC’s website at www.sec.gov or at
www.imperva.com/company/SECFilings.
Information concerning the interests of Imperva’s participants in
the solicitation, which may, in some cases, be different than those
of Imperva’s stockholders generally, will be set forth in the proxy
statement relating to the transaction when it becomes
available.
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version on businesswire.com: https://www.businesswire.com/news/home/20181010005519/en/
Investor RelationsImperva, Inc.Sunil Shah,
650-832-6852IR@imperva.comSunil.Shah@imperva.com
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