Infoblox Reports Fourth Quarter of Fiscal 2013 Results

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Infoblox Reports Fourth Quarter of Fiscal 2013 Results

Company Achieves 40% Year-over-Year Revenue Growth

SANTA CLARA, Calif.--(BUSINESS WIRE)-- Infoblox (NYS: BLOX) , the automated network control company, today reported its financial results for its fourth fiscal quarter and fiscal year ended July 31, 2013. Total net revenue for the fourth quarter of fiscal 2013 was a record $63.1 million, an increase of 40% on a year-over-year basis. Total net revenue for fiscal 2013 was a record $225.0 million, an increase of 33% compared with the total net revenue of $169.2 million in fiscal 2012.


On a GAAP basis, the Company reported a net income of $1.5 million, or $0.03 diluted earnings per share, for the fourth quarter of fiscal 2013, compared with a net loss of $4.3 million, or $0.10 loss per fully diluted share, for the fourth quarter of fiscal 2012. For fiscal 2013, the Company reported a GAAP basis net loss of $4.4 million, or $0.09 loss per fully diluted share, compared with a net loss of $8.2 million, or $0.40 loss per fully diluted share, in fiscal 2012.

The Company reported non-GAAP net income of $7.9 million, or $0.14 diluted earnings per share on a non-GAAP weighted-average share basis, for the fourth quarter of fiscal 2013, compared with non-GAAP net income of $0.7 million, or $0.01 diluted earnings per share on a non-GAAP weighted-average share basis, for the fourth quarter of fiscal 2012.

For fiscal 2013, the Company reported non-GAAP net income of $20.0 million, or $0.37 diluted earnings per share on a non-GAAP diluted weighted-average share basis, compared with non-GAAP net income of $5.3 million, or $0.12 diluted earnings per share on a non-GAAP diluted weighted-average share basis, in fiscal 2012. The GAAP to non-GAAP reconciling items for the fourth quarters and fiscal years 2013 and 2012 can be found in the "Reconciliation of GAAP to Non-GAAP Financial Measures" attached to this press release.

"By all measures, Infoblox had another outstanding quarter and another very strong fiscal year," said Robert Thomas, president and chief executive officer. "Revenue in the fourth quarter increased 40% year-over-year and was driven by strong product sales, which were up 52% year-over-year. From a bottom-line perspective, we reported solid non-GAAP operating profitability while still investing significantly in our business. Going forward, we enter fiscal 2014 with significant momentum and expect it to be another year of strong execution."

"In the quarter, we saw solid growth across all three geographies," said Remo Canessa, chief financial officer. "Our investments in sales and marketing have expanded our geographic reach and opportunities in the market, and we are pleased with the return on these investments."

Financial Outlook

Infoblox is providing an outlook of anticipated results for the first quarter ending October 31, 2013 and for the year ending July 31, 2014. This outlook is based on a number of assumptions that it believes are reasonable at the time of this earnings release. Information regarding potential risks that could cause the actual results to differ from these forward-looking statements is set forth below and in Infoblox's filings with the Securities and Exchange Commission.

For the first fiscal quarter ending October 31, 2013, the Company currently expects:

  • Total net revenue in the range of $62.5 million to $63.5 million;
  • Non-GAAP gross margin to be approximately 78%;
  • Non-GAAP operating margin in the range of 8% to 9%; and
  • Non-GAAP diluted net income per share ("non-GAAP EPS") to be in the range of $0.08 to $0.09, assuming approximately 56.8 million shares on a non-GAAP diluted weighted-average share basis.

For the fiscal year ending July 31, 2014, the Company currently expects:

  • Total net revenue in the range of $270 million to $276 million;
  • Non-GAAP gross margin to be approximately 78%;
  • Non-GAAP operating margin in the range of 10% to 12%; and
  • Non-GAAP EPS to be in the range of $0.44 to $0.55, assuming approximately 57.3 million shares on a non-GAAP diluted weighted-average share basis.

All forward-looking non-GAAP measures exclude estimates for stock-based compensation expenses and amortization of intangible assets. A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis.

About Non-GAAP Financial Measures

To supplement our financial results presented in accordance with Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including non-GAAP gross profit and gross margin, non-GAAP operating income and operating margin, non-GAAP net income, non-GAAP EPS and non-GAAP diluted weighted-average shares outstanding. We also provide first fiscal quarter 2014 and fiscal year 2014 guidance for non-GAAP gross margin, non-GAAP operating margin, non-GAAP EPS and non-GAAP diluted weighted-average shares outstanding. We believe these non-GAAP financial measures are helpful in understanding our past financial performance and future results. Our non-GAAP financial measures should not be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand and manage our business and forecast future periods. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. Our non-GAAP financial measures include adjustments based on the following items:

Stock-based compensation expenses: We have excluded the effect of stock-based compensation from our non-GAAP operating results. Although stock-based compensation is a key incentive offered to our employees, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods.

Amortization of intangible assets: We have excluded the effect of amortization of intangible assets from our non-GAAP operating results. Amortization of intangible assets is a non-cash expense, and it is not part of our core operations. Investors should note that the use of intangible assets contributed to revenues earned during the periods presented and will contribute to future period revenues as well.

Our non-GAAP Financial Measures are described as follows:

Non-GAAP gross profit and gross margin. Non-GAAP gross profit is gross profit as reported on our consolidated statements of operations, excluding the impact of stock-based compensation and intangible asset amortization expense. Non-GAAP gross margin is non-GAAP gross profit divided by net revenue.

Non-GAAP operating income and operating margin. Non-GAAP operating income is income (loss) from operations as reported on our consolidated statements of operations, excluding the impact of stock-based compensation and intangible asset amortization expense. Non-GAAP operating margin is non-GAAP operating income divided by net revenue.

Non-GAAP net income and non-GAAP EPS. Non-GAAP net income is net income (loss) as reported on our consolidated statements of operations, excluding the impact of stock-based compensation and intangible asset amortization expense. Non-GAAP EPS is non-GAAP net income divided by non-GAAP diluted weighted-average shares outstanding. Non-GAAP diluted weighted-average shares outstanding was computed to give effect to the conversion of all outstanding convertible preferred stock including the exercise of related preferred stock warrants and the exercise of certain common stock warrants which occurred upon the closing of our IPO on April 25, 2012, as if conversion or exercise had occurred at the beginning of the period of issuance.

For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, "Reconciliation of GAAP to Non-GAAP Financial Measures."

Conference Call & Webcast

Management will host a conference call today, September 5, 2013, at 1:30 p.m. PDT/4:30 p.m. EDT to discuss its fiscal fourth quarter and fiscal year 2013 financial results. To access the call, investors may dial 800-230-1059 (domestic) or 612-234-9959 (international) at least 10 minutes prior to the scheduled start of the call. A live webcast of the call will also be available on the corporate website at: http://ir.infoblox.com. An archive of the webcast will be available on our website and a taped replay will be available for one week at 800-475-6701 (domestic) or 320-365-3844 (international), passcode 299489.

About Infoblox

Infoblox (NYS: BLOX) delivers Automated Network Control solutions, the fundamental technology that connects end users, devices and networks. These solutions enable more than 6,700 enterprises and service providers to transform, secure and scale complex networks. Infoblox helps take the burden of complex network control out of human hands, reduce costs, and increase security, accuracy and uptime. Infoblox is headquartered in Santa Clara, California and has operations in 25 countries.

Cautionary Statement

The statements in this release regarding our momentum, expected execution, market opportunities as well as the statements regarding our expectations for fiscal 2014, and all statements under "Financial Outlook" are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause our actual results to differ materially, including, but not limited to: unexpected delays in the delivery of our solutions, particularly at the end of the quarter, changes in demand for automated network control solutions, the market acceptance of our products; the fluctuations in our gross margins; the concentration of our customer base; competitive developments including pricing pressures; our ability to manage operating expenses effectively; and the general economic, industry or political conditions in the United States or internationally.

For a detailed discussion of these and other risk factors, please refer to our filings with the Securities and Exchange Commission, including the final prospectus related to our initial public offering, which are available on our investor relations Web site (http://ir.infoblox.com/) and on the SEC's Web site (www.sec.gov).

All information provided in this release and in the attachments is as of September 5, 2013, and stockholders of Infoblox are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. Infoblox does not undertake any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this September 5, 2013 press release, or to reflect the occurrence of unanticipated events.

          
INFOBLOX INC.
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - GAAP BASIS
(In thousands, except per share data)
(Unaudited)
 
Three Months EndedYear Ended July 31,
July 31, 2013April 30, 2013July 31, 201220132012
Net revenue:
Products and licenses$36,702$33,596$24,216$128,203$95,012
Services 26,363  24,439  20,864  96,841  74,234 
Total net revenue 63,065  58,035  45,080  225,044  169,246 
Cost of revenue:
Products and licenses8,5027,7866,05029,22821,778
Services 5,324  4,910  4,254  19,025  15,342 
Total cost of revenue 13,826  12,696  10,304  48,253  37,120 
Gross profit 49,239  45,339  34,776  176,791  132,126 
Operating expenses:
Research and development11,27310,9769,75243,05636,624
Sales and marketing29,50828,13824,505112,38586,474
General and administrative 7,142  6,195  4,398  24,488  15,548 
Total operating expenses 47,923  45,309  38,655  179,929  138,646 
Income (loss) from operations1,31630(3,879)(3,138)(6,520)
Other expense, net (247) (45) (158) (618) (946)
Income (loss) before provision for (benefit from) income taxes1,069(15)(4,037)(3,756)(7,466)
Provision for (benefit from) income taxes (418) 242  309  650  744 
Net income (loss)$1,487 $(257)$(4,346)$(4,406)$(8,210)
Net income (loss) per share - basic and diluted$0.03 $(0.01)$(0.10)$(0.09)$(0.40)
Weighted-average shares used in computing basic net income (loss) per share 50,861  49,261  45,645  48,494  20,563 
Weighted-average shares used in computing diluted net income (loss) per share 55,826  49,261  45,645  48,494  20,563 
 
 
INFOBLOX INC.
 
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except per share data)
(Unaudited)
 
  Three Months Ended  Year Ended July 31,
July 31, 2013  April 30, 2013  July 31, 20122013  2012
Gross Profit Reconciliation:
GAAP gross profit$49,239$45,339$34,776$176,791$132,126
Stock-based compensation expense4153873591,606700
Amortization of intangible assets 253  254  322  1,015  1,302 
Non-GAAP gross profit$49,907 $45,980 $35,457 $179,412 $134,128 
Gross Margin Reconciliation:
GAAP gross margin78.1%78.1%77.1%78.6%78.1%
Stock-based compensation expense0.6%0.7%0.8%0.7%0.4%
Amortization of intangible assets 0.4% 0.4% 0.7% 0.4% 0.8%
Non-GAAP gross margin 79.1% 79.2% 78.6% 79.7% 79.3%
Operating Income (Loss) Reconciliation:
GAAP operating income (loss)$1,316$30$(3,879)$(3,138)$(6,520)
Stock-based compensation expense5,8745,6504,37222,06410,652
Amortization of intangible assets 580  581  649  2,323  2,862 
Non-GAAP operating income$7,770 $6,261 $1,142 $21,249 $6,994 
Operating Margin Reconciliation:
GAAP operating margin2.1%0.1%(8.6%)(1.4%)(3.9%)
Stock-based compensation expense9.3 Read Full Story

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