Increased Annual Recurring Revenue 15% to
$4.2 Billion Achieved Q4 GAAP Net Income of $427 Million
Generated over $1 Billion in Annual Operating Cash Flow and
Adjusted Free Cash Flow
Splunk Inc. (NASDAQ: SPLK), the cybersecurity and observability
leader, today announced results for its fiscal fourth quarter and
full year ended January 31, 2024, as compared to the corresponding
period of the last fiscal year:
Fourth Quarter 2024 Financial
Highlights
- Total ARR was $4.208 billion, up 15%; Cloud ARR was $2.186
billion, up 23%.
- Total revenues were $1.486 billion, up 19%; Cloud revenue was
$503 million, up 22%.
- GAAP operating expenses increased 6.5%; non-GAAP operating
expenses decreased 3.1%.
- GAAP operating margin was 29.1%; non-GAAP operating margin was
47.8%.
- GAAP net income was $427 million; non-GAAP net income was $579
million.
- Operating cash flow was $421 million, up 53%; adjusted free
cash flow was $418 million, up 56%.
- 899 customers with Total ARR greater than $1 million, an
increase of 109 customers.
Full Year 2024 Financial
Highlights
- Total revenues were $4.216 billion, up 15%; Cloud revenue was
$1.837 billion, up 26%.
- GAAP operating expenses increased 1.6%; non-GAAP operating
expenses decreased 1.8%.
- GAAP operating margin was 5.7%; non-GAAP operating margin was
28.9%.
- GAAP net income was $264 million; non-GAAP net income was
$1.032 billion.
- Operating cash flow was $1.008 billion, up 124%; adjusted free
cash flow was $1.007 billion, up 136%.
"We delivered a solid finish to FY24 as our team doubled down on
helping organizations worldwide keep their digital systems
resilient," said Gary Steele, President and CEO of Splunk. "In Q4,
we grew Total ARR to $4.2 billion, and we finished FY24 with nearly
900 customers each generating more than $1 million in ARR. We’re
pleased to bring this momentum to Cisco, and we believe there is an
incredible opportunity to meet the ever-increasing security and
observability needs of the world’s largest and most complex
enterprises."
“Q4 was a capstone to a strong year of execution, with ARR
growing 15% while we reduced quarterly non-GAAP operating expenses
3% year-over-year. This progress helped drive $427 million of
quarterly GAAP net income and over $1 billion of annual adjusted
free cash flow, up 136% year-over-year,” said Brian Roberts, CFO of
Splunk.
Fourth Quarter Investor Presentation
and Stockholder Letter
Visit the Splunk investor relations website to download the
company’s quarterly investor presentation, which includes Splunk
President and CEO Gary Steele’s letter to stockholders.
Pending Acquisition by
Cisco
In light of the pending transaction with Cisco, Splunk will not
be hosting an earnings conference call to review the fourth quarter
or providing a financial outlook. While the closing of the
acquisition by Cisco remains subject to regulatory approvals and
conditions, given the positive regulatory approvals to date, the
transaction is now expected to close in late Q1 or early Q2 of
calendar year 2024.
Recent Business
Highlights
- Splunk Security Innovations Strengthen Digital
Resilience: Splunk delivered Splunk Enterprise Security 7.3 to
provide an enhanced security analyst experience as well as enrich
risk context for seamless security incident triage. In addition,
Splunk SOAR 6.2 (Security Orchestration Automation and Response)
allows users to configure logic loops directly in the Visual
Playbook Editor and leverage a new set of firewall management
apps.
- Splunk Observability Enhancements Simplify Telemetry Data
Collection: Splunk’s latest observability innovation, Splunk
Add-On for OpenTelemetry Collector, simplifies getting started with
Splunk Observability Cloud and enables additional consistency in
how customers manage data collection at scale.
- Hundreds of Public Sector Leaders Attend Splunk’s Annual
GovSummit Conference: Public sector partners and customers
connected on U.S. national cyber strategy and digital resilience
during Splunk’s largest public sector event. A recent Splunk and
Foundry survey of cybersecurity professionals revealed 80% of all
decision makers said their organizations are using AI to address
cybersecurity, and almost half of public sector respondents said
they plan to use AI to increase productivity.
Safe Harbor Statement
This press release contains forward-looking statements that
involve risks and uncertainties, including statements regarding
Splunk’s opportunities; Splunk’s proposed acquisition by Cisco and
expected timing of the completion of the acquisition and receipt of
regulatory approvals, as well as the benefits of the acquisition;
trends in customer demand and engagement as well as Splunk’s
operating and financial performance; statements regarding our
operating efficiency, growth, profitability and cash flows;
statements regarding our products, projects, technology and ongoing
product development, including recently announced products;
statements regarding our partnerships; statements regarding our
market opportunity as well as our ability to meet customer needs;
and trends in the markets for our products, including the security
and observability markets. There are a significant number of
factors that could cause actual results to differ materially from
statements made in this press release, including: the risk that the
proposed transaction with Cisco is not completed on the anticipated
terms or in the time anticipated, including risks related to
obtaining regulatory approvals, anticipated tax treatment,
unforeseen liabilities, future capital expenditures, revenues,
expenses, earnings, synergies, economic performance, indebtedness,
financial condition, losses, future prospects, business and
management strategies for the management, expansion and growth of
Splunk’s business and other conditions to the completion of the
transaction; significant transaction costs associated with the
proposed transaction; potential litigation relating to the proposed
transaction; the risk that disruptions from the proposed
transaction will harm Splunk’s business, including current plans
and operations; the ability of Splunk to implement its business
strategy; the impact of the macroeconomic environment, including
inflationary pressures, economic uncertainty and impacts on
information technology spending; risks associated with Splunk’s
growth; the impact of Splunk’s restructuring plans; risks
associated with Splunk’s ability to successfully introduce and gain
market acceptance for new products and technologies; Splunk’s
inability to realize value from its significant investments in the
company’s business, including product and service innovations and
through acquisitions; Splunk’s shift from sales of licenses to
sales of cloud services which impacts the timing of revenue and
margins; Splunk’s transition to a multi-product software and
services business; Splunk’s inability to successfully integrate
acquired businesses and technologies; Splunk’s inability to service
its debt obligations or other adverse effects related to the
company’s convertible notes; and general market, political,
economic, business and competitive market conditions.
Additional information on potential factors that could affect
Splunk’s financial results is included in the company’s Quarterly
Report on Form 10-Q for the fiscal quarter ended October 31, 2023,
which is on file with the U.S. Securities and Exchange Commission
(“SEC”) and Splunk’s other filings with the SEC. Splunk does not
assume any obligation to update the forward-looking statements
provided to reflect events that occur or circumstances that exist
after the date on which they were made.
About Splunk Inc.
Splunk Inc. (NASDAQ: SPLK) helps build a safer and more
resilient digital world. Organizations trust Splunk to prevent
security, infrastructure and application incidents from becoming
major issues, absorb shocks from digital disruptions, and
accelerate digital transformation.
Splunk and Splunk> are trademarks and registered trademarks
of Splunk Inc. in the United States and other countries. All other
brand names, product names, or trademarks belong to their
respective owners. © 2024 Splunk Inc. All rights reserved.
Splunk Inc. Consolidated Statements of
Operations (In thousands, except per share amounts)
(Unaudited)
Three Months Ended January
31,
Fiscal Year Ended January
31,
2024
2023
2024
2023
Revenues Cloud services
$
503,375
$
413,934
$
1,837,418
$
1,457,295
License
810,133
670,005
1,706,358
1,521,116
Maintenance and services
172,639
167,166
671,819
675,297
Total revenues
1,486,147
1,251,105
4,215,595
3,653,708
Cost of revenues Cloud services
144,219
128,360
544,807
490,299
License
2,137
1,253
7,623
5,312
Maintenance and services
77,196
75,670
300,233
320,384
Total cost of revenues
223,552
205,283
852,663
815,995
Gross profit
1,262,595
1,045,822
3,362,932
2,837,713
Operating expenses Research and development
235,341
243,027
943,933
997,170
Sales and marketing
439,378
427,589
1,671,102
1,621,518
General and administrative
156,062
109,135
508,393
454,531
Total operating expenses
830,781
779,751
3,123,428
3,073,219
Operating income (loss)
431,814
266,071
239,504
(235,506
)
Interest and other income (expense), net Interest income
23,912
12,482
103,255
25,401
Interest expense
(9,860
)
(11,230
)
(42,505
)
(46,026
)
Other income (expense), net
(3,683
)
(1,772
)
(3,083
)
(9,320
)
Total interest and other income (expense), net
10,369
(520
)
57,667
(29,945
)
Income (loss) before income taxes
442,183
265,551
297,171
(265,451
)
Income tax provision (benefit)
15,634
(3,241
)
33,437
12,411
Net income (loss)
$
426,549
$
268,792
$
263,734
$
(277,862
)
Basic net income (loss) per share
$
2.52
$
1.64
$
1.58
$
(1.71
)
Diluted net income (loss) per share
$
2.28
$
1.44
$
1.52
$
(1.71
)
Weighted-average shares used in computing basic net income
(loss) per share
169,092
164,262
167,136
162,376
Weighted-average shares used in computing diluted net income (loss)
per share
191,452
187,002
175,363
162,376
Splunk Inc. Consolidated Balance Sheets (In
thousands) (Unaudited) January 31, 2024
January 31, 2023 Assets Current assets Cash and cash
equivalents
$
1,643,141
$
690,587
Investments, current
360,412
1,316,347
Accounts receivable, net
1,840,928
1,572,604
Prepaid expenses and other current assets
162,472
174,388
Deferred commissions, current
145,339
116,758
Total current assets
4,152,292
3,870,684
Investments, non-current
37,529
41,700
Accounts receivable, non-current
493,312
314,286
Operating lease right-of-use assets
132,016
186,981
Property and equipment, net
84,279
108,540
Intangible assets, net
66,963
119,588
Goodwill
1,416,920
1,416,920
Deferred commissions, non-current
268,568
242,731
Other assets
35,477
42,493
Total assets
$
6,687,356
$
6,343,923
Liabilities and Stockholders' Equity Current liabilities
Accounts payable
$
34,715
$
15,299
Accrued compensation
363,959
357,550
Accrued expenses and other liabilities
178,604
229,480
Deferred revenue, current
1,980,616
1,657,685
Debt, current
-
775,656
Total current liabilities
2,557,894
3,035,670
Debt, non-current
3,106,928
3,099,289
Operating lease liabilities
154,644
202,268
Deferred revenue, non-current
98,609
91,102
Other liabilities, non-current
28,672
26,107
Total non-current liabilities
3,388,853
3,418,766
Total liabilities
5,946,747
6,454,436
Stockholders' equity Common stock
177
171
Accumulated other comprehensive loss
(1,203
)
(6,363
)
Additional paid-in capital
5,245,088
4,671,776
Treasury stock
(980,452
)
(989,362
)
Accumulated deficit
(3,523,001
)
(3,786,735
)
Total stockholders' equity (deficit)
740,609
(110,513
)
Total liabilities and stockholders' equity
$
6,687,356
$
6,343,923
Splunk Inc. Consolidated Statements of Cash
Flows (In thousands) (Unaudited)
Three Months Ended January
31,
Fiscal Year Ended January
31,
2024
2023
2024
2023
Cash flows from operating activities Net income (loss)
$
426,549
$
268,792
$
263,734
$
(277,862
)
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: Depreciation and amortization
19,665
26,024
88,675
99,470
Amortization of deferred commissions
29,914
29,796
127,007
111,205
Amortization of investment premiums (accretion of discounts), net
7,634
(2,590
)
2,725
(4,652
)
Loss on strategic equity investments, net
1,000
-
4,414
97
Amortization of debt issuance costs
2,002
2,401
8,644
10,279
Loss on facility exits
23,354
-
29,085
10,000
Non-cash operating lease costs
(1,058
)
3,403
(6,086
)
324
Stock-based compensation
209,360
187,393
786,824
789,138
Deferred income taxes
2,572
(1,261
)
2,079
(2,695
)
Loss on disposal of assets
224
782
253
782
Changes in operating assets and liabilities, net of acquisition:
Accounts receivable, net
(959,065
)
(745,160
)
(447,212
)
(337,177
)
Prepaid expenses and other assets
(31,037
)
(54,633
)
22,884
42,075
Deferred commissions
(63,250
)
(65,130
)
(181,425
)
(167,496
)
Accounts payable
29,488
(3,134
)
19,416
(43,907
)
Accrued compensation
81,352
109,392
6,409
(39,402
)
Accrued expenses and other liabilities
30,726
30,887
(49,501
)
(15,337
)
Deferred revenue
611,917
489,026
330,438
274,788
Net cash provided by operating activities
421,347
275,988
1,008,363
449,630
Cash flows from investing activities Purchases of property
and equipment
(1,440
)
(4,391
)
(10,626
)
(13,620
)
Capitalized software development costs
(3,130
)
(2,976
)
(12,091
)
(8,782
)
Purchases of marketable securities
(358,176
)
(547,654
)
(1,681,651
)
(1,536,558
)
Maturities of marketable securities
752,034
163,086
2,640,278
515,950
Purchases of strategic investments
(150
)
(375
)
(3,493
)
(6,734
)
Sale of strategic investments
3,000
-
3,000
-
Acquisition, net of cash acquired
-
(21,950
)
-
(21,950
)
Other investment activities
251
-
251
1,534
Net cash provided by (used in) investing activities
392,389
(414,260
)
935,668
(1,070,160
)
Cash flows from financing activities Proceeds from the
exercise of stock options
110
59
523
1,457
Proceeds from employee stock purchase plan
30,534
29,722
81,735
78,318
Repayment of 2023 Notes
-
-
(776,661
)
-
Taxes paid related to net share settlement of equity awards
(126,750
)
(33,851
)
(294,623
)
(197,349
)
Net cash used in financing activities
(96,106
)
(4,070
)
(989,026
)
(117,574
)
Net increase (decrease) in cash, cash equivalents, and restricted
cash
717,630
(142,342
)
955,005
(738,104
)
Cash, cash equivalents, and restricted cash at beginning of period
927,962
832,929
690,587
1,428,691
Cash, cash equivalents, and restricted cash at end of period
$
1,645,592
$
690,587
$
1,645,592
$
690,587
Splunk Inc. Operating Metrics
Total Annual Recurring Revenue (“Total ARR”) represents the
annualized value of active cloud services, term licenses and
maintenance contracts at the end of a reporting period. Cloud
Annual Recurring Revenue (“Cloud ARR”) represents the annualized
value of active cloud services contracts at the end of a reporting
period.
Non-GAAP Financial Measures and
Reconciliations
To supplement Splunk’s consolidated financial statements, which
have been prepared in accordance with generally accepted accounting
principles in the United States (“GAAP”), Splunk provides investors
with the following non-GAAP financial measures: cloud services cost
of revenues, cloud services gross margin, cost of revenues, gross
margin, research and development expense, sales and marketing
expense, general and administrative expense, operating expenses,
operating income (loss), operating margin, income tax provision
(benefit), net income (loss), free cash flow and adjusted free cash
flow (collectively the “non-GAAP financial measures”). These
non-GAAP financial measures exclude all or a combination of the
following (as reflected in the following reconciliation tables):
expenses related to stock-based compensation and related employer
payroll tax, amortization of intangible assets, acquisition-related
adjustments, restructuring and facility exit charges,
merger-related expenses, capitalized software development costs,
non-cash interest expense related to convertible senior notes and a
net loss on strategic equity investments. The non-GAAP financial
measures are also adjusted for Splunk's current and deferred tax
rate on non-GAAP income (loss). Splunk uses a long-term projected
non-GAAP tax rate to provide consistency across interim reporting
periods. We base our rate on non-GAAP financial projections. In
determining our tax rate, we exclude the impact of nonrecurring
items, and we make assumptions including those about tax
legislation and our tax positions. We applied a 20% non-GAAP tax
rate to the three and twelve months ended January 31, 2024 and
2023. In addition, non-GAAP financial measures include free cash
flow and adjusted free cash flow. Free cash flow represents net
cash provided by operating activities, less purchases of property
and equipment and capitalized software development costs. Adjusted
free cash flow is a non-GAAP measure that additionally excludes
from free cash flow the impact of cash paid for costs incurred as a
result of the proposed Cisco merger. Splunk believes that free cash
flow and adjusted free cash flow provide investors useful
information to better understand the factors and trends affecting
the Company’s performance and liquidity. Both of these free cash
flow measures have limitations as they omit certain components of
the overall cash flow statement and do not represent the residual
cash flow available for discretionary expenditures.
Splunk excludes stock-based compensation expense because it is
non-cash in nature and excluding this expense provides meaningful
supplemental information regarding Splunk’s operational performance
and allows investors the ability to make more meaningful
comparisons between Splunk’s operating results and those of other
companies. Splunk excludes employer payroll tax expense related to
employee stock plans in order for investors to see the full effect
that excluding that stock-based compensation expense had on
Splunk’s operating results. Employer payroll tax expense is tied to
the exercise or vesting of underlying equity awards and the price
of Splunk’s common stock at the time of vesting or exercise, which
may vary from period to period independent of the operating
performance of Splunk’s business. Splunk also excludes amortization
of intangible assets, acquisition-related adjustments,
restructuring and facility exit charges, merger-related expenses,
capitalized software development costs, non-cash interest expense
related to convertible senior notes and a net loss on strategic
equity investments from the applicable non-GAAP financial measures
because these adjustments are considered by management to be
outside of Splunk’s core operating results. A reconciliation of
non-GAAP guidance measures to corresponding GAAP guidance measures
is not available on a forward-looking basis without unreasonable
effort due to the uncertainty regarding, and the potential
variability of, expenses that may be incurred in the future. For
example, stock-based compensation-related charges, including
related employer payroll tax-related items, are impacted by the
timing of employee stock transactions, the future fair market value
of our common stock, and our future hiring and retention needs, all
of which are difficult to predict and subject to constant change.
We have provided a reconciliation of GAAP to non-GAAP financial
measures in the financial statement tables for our historical
non-GAAP financial results included in this release.
There are limitations in using non-GAAP financial measures
because the non-GAAP financial measures are not prepared in
accordance with GAAP, may be different from non-GAAP financial
measures used by Splunk’s competitors and exclude expenses that may
have a material impact upon Splunk’s reported financial results.
Further, stock-based compensation expense has been and will
continue to be for the foreseeable future, a significant recurring
expense in Splunk’s business and an important part of the
compensation provided to Splunk’s employees. The presentation of
the non-GAAP financial measures is not intended to be considered in
isolation or as a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP. Splunk
uses these non-GAAP financial measures for financial and
operational decision-making purposes and as a means to evaluate
period-to-period comparisons. Splunk believes that these non-GAAP
financial measures provide useful information about Splunk’s
operating results, enhance the overall understanding of past
financial performance and future prospects and allow for greater
transparency with respect to key metrics used by management in its
financial and operational decision making. In addition, these
non-GAAP financial measures facilitate comparisons to competitors’
operating results. The non-GAAP financial measures are meant to
supplement and be viewed in conjunction with GAAP financial
measures.
Splunk Inc. Reconciliation of GAAP to Non-GAAP
Financial Measures (In thousands) (Unaudited)
Reconciliation of Cash Provided By
Operating Activities to Adjusted Free Cash Flow
Three Months Ended January
31,
Fiscal Year Ended January
31,
2024
2023
2024
2023
Net cash provided by operating activities
$
421,347
$
275,988
$
1,008,363
$
449,630
Less purchases of property and equipment
(1,440
)
(4,391
)
(10,626
)
(13,620
)
Less capitalized software development costs
(3,130
)
(2,976
)
(12,091
)
(8,782
)
Free cash flow (non-GAAP)
$
416,777
$
268,621
$
985,646
$
427,228
Cash paid for merger-related expenses
1,132
-
21,057
-
Adjusted free cash flow (non-GAAP)
$
417,909
$
268,621
$
1,006,703
$
427,228
Net cash provided by (used in) investing activities
$
392,389
$
(414,260
)
$
935,668
$
(1,070,160
)
Net cash used in financing activities
$
(96,106
)
$
(4,070
)
$
(989,026
)
$
(117,574
)
The following tables reconcile Splunk’s GAAP results to Splunk’s
non-GAAP results included in this press release.
Reconciliation of GAAP to Non-GAAP
Financial Measures Three Months
Ended January 31, 2024 GAAP Stock-based
compensation and related employer payroll tax Amortization
of intangible assets Restructuring and facility exit charges
(2) Merger-related expenses Capitalized software
development costs Non-cash interest expense related to
convertible senior notes Loss on strategic equity
investments, net Income tax adjustment (1)
Non-GAAP Cloud services cost of revenues
$
144,219
$
(5,055
)
$
(6,647
)
$
(558
)
$
-
$
(3,395
)
$
-
$
-
$
-
$
128,564
Cloud services gross margin
71.4
%
1.0
%
1.3
%
0.10
%
-
%
0.7
%
-
%
-
%
-
%
74.5
%
Cost of revenues
223,552
(22,686
)
(7,875
)
(2,097
)
-
(3,395
)
-
-
-
187,499
Gross margin
85.0
%
1.5
%
0.5
%
0.1
%
-
%
0.2
%
-
%
-
%
-
%
87.4
%
Research and development
235,341
(77,695
)
-
(8,458
)
-
3,130
-
-
-
152,318
Sales and marketing
439,378
(65,770
)
(3,578
)
(15,112
)
-
-
-
-
-
354,918
General and administrative
156,062
(47,720
)
-
(26,254
)
(1,352
)
-
-
-
-
80,736
Operating expenses
830,781
(191,185
)
(3,578
)
(49,824
)
(1,352
)
3,130
-
-
-
587,972
Operating income
431,814
213,871
11,453
51,921
1,352
265
-
-
-
710,676
Operating margin
29.1
%
14.4
%
0.8
%
3.5
%
0.1
%
-
%
-
%
-
%
-
%
47.8
%
Income tax provision
15,634
-
-
-
-
-
-
-
129,176
144,810
Net income
$
426,549
$
213,871
$
11,453
$
51,921
$
1,352
$
265
$
2,003
$
1,000
$
(129,176
)
$
579,238
_______________________ (1) Represents the income tax adjustment
using our estimated non-GAAP tax rate of 20%. (2) Excludes $2,807
of total stock-based compensation restructuring charges, which are
included under Stock-based compensation and related employer
payroll tax.
Reconciliation of GAAP to
Non-GAAP Financial Measures Three Months Ended January 31, 2023
GAAP Stock-based compensation and related employer
payroll tax Amortization of intangible assets
Restructuring and facility exit charges Capitalized
software development costs Non-cash interest expense related
to convertible senior notes Income tax adjustment (1)
Non-GAAP Cloud services cost of revenues
$
128,360
$
(6,226
)
$
(8,209
)
$
-
$
(3,788
)
$
-
$
-
$
110,137
Cloud services gross margin
69.0
%
1.5
%
2.0
%
-
%
0.9
%
-
%
-
%
73.4
%
Cost of revenues
205,283
(21,775
)
(9,438
)
-
(3,788
)
-
-
170,282
Gross margin
83.6
%
1.7
%
0.8
%
-
%
0.3
%
-
%
-
%
86.4
%
Research and development
243,027
(88,741
)
-
-
2,976
-
-
157,262
Sales and marketing
427,589
(61,690
)
(4,908
)
(3,968
)
-
-
-
357,023
General and administrative
109,135
(16,850
)
-
-
-
-
-
92,285
Operating expenses
779,751
(167,281
)
(4,908
)
(3,968
)
2,976
-
-
606,570
Operating income
266,071
189,056
14,346
3,968
812
-
-
474,253
Operating margin
21.3
%
15.1
%
1.1
%
0.3
%
0.1
%
-
%
-
%
37.9
%
Income tax provision (benefit)
(3,241
)
-
-
-
-
-
98,468
95,227
Net income
$
268,792
$
189,056
$
14,346
$
3,968
$
812
$
2,401
$
(98,468
)
$
380,907
_______________________ (1) Represents the income tax adjustment
using our estimated non-GAAP tax rate of 20%.
Reconciliation of GAAP to Non-GAAP Financial
Measures Fiscal Year Ended
January 31, 2024 GAAP Stock-based compensation
and related employer payroll tax Amortization of intangible
assets Restructuring and facility exit charges (2)
Merger-related expenses Capitalized software development
costs Non-cash interest expense related to convertible
senior notes Loss on strategic equity investments, net
Income tax adjustment (1) Non-GAAP Cloud
services cost of revenues
$
544,807
$
(22,970
)
$
(31,165
)
$
(1,065
)
$
-
$
(14,216
)
$
-
$
-
$
-
$
475,391
Cloud services gross margin
70.4
%
1.3
%
1.7
%
0.1
%
-
%
0.8
%
-
%
-
%
-
%
74.1
%
Cost of revenues
852,663
(89,166
)
(36,080
)
(3,701
)
-
(14,216
)
-
-
-
709,500
Gross margin
79.8
%
2.1
%
0.9
%
0.1
%
-
%
0.3
%
-
%
-
%
-
%
83.2
%
Research and development
943,933
(327,036
)
-
(25,099
)
-
12,091
-
-
-
603,889
Sales and marketing
1,671,102
(253,216
)
(16,545
)
(19,475
)
-
-
-
-
-
1,381,866
General and administrative
508,393
(138,034
)
-
(45,274
)
(23,571
)
-
-
-
-
301,514
Operating expenses
3,123,428
(718,286
)
(16,545
)
(89,848
)
(23,571
)
12,091
-
-
-
2,287,269
Operating income
239,504
807,452
52,625
93,549
23,571
2,125
-
-
-
1,218,826
Operating margin
5.7
%
19.2
%
1.3
%
2.2
%
0.6
%
0.1
%
-
%
-
%
-
%
28.9
%
Income tax provision
33,437
-
-
-
-
-
-
-
224,473
257,910
Net income
$
263,734
$
807,452
$
52,625
$
93,549
$
23,571
$
2,125
$
8,644
$
4,414
$
(224,473
)
$
1,031,641
_______________________ (1) Represents the income tax adjustment
using our estimated non-GAAP tax rate of 20%. (2) Excludes $6,544
of total stock-based compensation restructuring charges, which are
included under Stock-based compensation and related employer
payroll tax.
Reconciliation of GAAP to
Non-GAAP Financial Measures Fiscal Year Ended January 31, 2023 GAAP
Stock-based compensation and related employer payroll tax
Amortization of intangible assets Acquisition-related
adjustments Restructuring and facility exit charges
Capitalized software development costs Non-cash interest
expense related to convertible senior notes Loss on
strategic equity investments, net Income tax adjustment
(1) Non-GAAP Cloud services cost of revenues
$
490,299
$
(23,082
)
$
(30,943
)
$
-
$
-
$
(12,777
)
$
-
$
-
$
-
$
423,497
Cloud services gross margin
66.4
%
1.6
%
2.0
%
-
%
-
%
0.9
%
-
%
-
%
-
%
70.9
%
Cost of revenues
815,995
(87,837
)
(35,859
)
-
-
(12,777
)
-
-
-
679,522
Gross margin
77.7
%
2.4
%
1.0
%
-
%
-
%
0.3
%
-
%
-
%
-
%
81.4
%
Research and development
997,170
(345,679
)
-
-
-
8,782
-
-
-
660,273
Sales and marketing
1,621,518
(252,952
)
(20,522
)
-
(3,968
)
-
-
-
-
1,344,076
General and administrative
454,531
(118,066
)
-
(692
)
(10,000
)
-
-
-
-
325,773
Operating expenses
3,073,219
(716,697
)
(20,522
)
(692
)
(13,968
)
8,782
-
-
-
2,330,122
Operating income (loss)
(235,506
)
804,534
56,381
692
13,968
3,995
-
-
-
644,064
Operating margin
(6.4
)%
22.0
%
1.5
%
-
%
0.4
%
0.1
%
-
%
-
%
-
%
17.6
%
Income tax provision
12,411
-
-
-
-
-
-
-
112,488
124,899
Net income (loss)
$
(277,862
)
$
804,534
$
56,381
$
692
$
13,968
$
3,995
$
10,279
$
97
$
(112,488
)
$
499,596
_______________________ (1) Represents the income tax adjustment
using our estimated non-GAAP tax rate of 20%.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240227889324/en/
For more information, please contact:
Media Contact Patricia Hogan Splunk Inc.
press@splunk.com
Investor Contact Katie White Splunk Inc.
ir@splunk.com
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