Nice Ltd. · TASE:NICE
Nice — Q2 2018 Earnings Presentation
22 slides from Nice's earnings presentation, Aug 9, 2018
Slide 1: 2018 Second Quarter Results
2018 SECOND QUARTER RESULTS Ended June 30, 2018
Slide 2: Forward Looking Statements Disclaimer
Forward Looking Statements Disclaimer This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements may be identified by words such as “believe,” “expect,” “seek,” “may,” “will,” “inte
Slide 3: Explanation of Non-GAAP measures
Explanation of Non-GAAP measures Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: amortization of acquired intangible assets, share-based compensation, certain business combination accounting entries, amortization of discount on long term debt, ASC 606 to ASC 605 a
Slide 4: Q2 2018 Highlights, Income Statement, Balance Sheet and Cash Flow, Outlook
Q2 2018 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 5: Q2 2018 Highlights
Q2 2018 Highlights* Revenue of $345M; Cloud revenue Recurring revenue Gross profit growth of 10% increased 28% increased to 73% increased 10%; compared to Q2 to $110M of total revenue to $244M last year compared to compared to 66% compared to Q2 Q2 last year in Q2 last year last year Operating incom
Slide 6: Income Statement
Q2 2018 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 7: Strong Growth and Execution
Strong Growth and Execution* REVENUES (Non-GAAP, $M) 345 • Revenue increased 10% year-over-year 315 • Strong cloud revenue growth of 28% • Recurring revenue accounted for 73% of total 10% revenue compared to 66% in the same quarter of 2017 Q2 17 Q2 18 EARNINGS PER SHARE (Non-GAAP, $) • Strong revenu
Slide 8: GAAP and Non-GAAP Income Statement
GAAP and Non-GAAP Income Statement* $M (except EPS) Q2 2018 Q2 2017 GAAP revenue 342.0 311.5 Valuation adjustment on acquired deferred product revenue 0.0 0.0 Valuation adjustment on acquired deferred service revenue 0.2 2.1 Valuation adjustment on acquired deferred cloud revenue 1.4 1.6 ASC 606 to
Slide 9: GAAP and Non-GAAP Income Statement (cont.)
GAAP and Non-GAAP Income Statement* (cont.) $M (except EPS) Q2 2018 Q2 2017 GAAP finance & other expense, net (2.9) (3.4) Amortization of discount on long term debt 2.1 2.1 Non-GAAP finance & other income (expense), net (0.8) (1.3) GAAP taxes on income 9.2 2.0 Tax adjustment re non-GAAP adjustments
Slide 10: Revenue Breakdown by Region (Non-GAAP)
Q2 2018 Revenue Breakdown by Region* (Non-GAAP) 78% 14% AMERICAS EMEA $269M, +10% YoY $48M, +12% YoY 8% APAC $28M, +1% YoY * All numbers presented are Non-GAAP under ASC 605 10
Slide 11: Revenue Breakdown by Business Unit (Non-GAAP)
Q2 2018 Revenue Breakdown by Business Unit* (Non-GAAP) 19% FINANCIAL CRIME & COMPLIANCE $64M, +4% YoY 81% CUSTOMER ENGAGEMENT $281M, +11% YoY * All numbers presented are Non-GAAP under ASC 605 11
Slide 12: Gross Profit and Gross Margin (Non-GAAP)
Gross Profit and Gross Margin* (Non-GAAP) $300 90,0% $244M $250 $222M $200 80,0% $150 70,6% $100 70,0% 70,5% $50 60,0% $- Q2 17 Q2 18 Gross Income • Gross profit and gross margin increased as a result of strong revenue growth and continued efficiency in cost of goods 12 * All numbers presented are N
Slide 13: Gross Margin Q2 2018 (Non-GAAP)
Gross Margin Q2 2018* (Non-GAAP) PRODUCT MARGIN SERVICES MARGIN CLOUD MARGIN 88.2%| -120bp 70.2%| +240bp 62.7%| +230bp Service GM Product GM Product GM 70,2% 89,4% Service GM 88,2% 67,8% Cloud GM Cloud 62,7% GM 60,4% Q2 17 Q2 18 Q2 17 Q2 18 Q2 17 Q2 18 • Continued expansion in the services gross mar
Slide 14: Operating Income and Operating Margin (Non-GAAP)
Operating Income and Operating Margin* (Non-GAAP) 40,0% $90 $85M 35,0% $80 $72M 30,0% $70 Название оси Название оси 24,7% 25,0% $60 22,8% 20,0% $50 15,0% $40 10,0% $30 Q2 17 Q2 18 Operating Income Operating Margin • Increase in operating income and operating margin are the result of the strong lever
Slide 15: Cost Ratio Q2 2018 (Non-GAAP)
Cost Ratio Q2 2018* (Non-GAAP) R&D S&M G&A As % of revenue As % of revenue As % of revenue S&M 26,0% S&M 25,4% R&D G&A 12,9% 8,8% G&A R&D 12,1% 8,4% Q2 17 Q2 18 Q2 17 Q2 18 Q2 17 Q2 18 * All numbers presented are Non-GAAP under ASC 605 15
Slide 16: Balance Sheet and Cash Flow Analysis
Q2 2018 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 17: Balance Sheet
Balance Sheet* June 30, 2018 Assets ($M) 06/30/2018 12/31/2017 Equity & Liabilities ($M) 06/30/2018 12/31/2017 Cash and cash equivalents 364.8 328.3 Trade payables 31.7 29.4 Short term investments 145.8 64.0 Deferred revenue and advances from customers 212.8 184.6 Trade receivables 209.7 230.7 Accru
Slide 18: Cash Flow From Operations
Cash Flow From Operations $M Q2 18 Q2 17 %∆ Cash flow from operations 63.8 68.7 (7%) - Capital expenditure 8.2 12.3 (33%) - Capitalization of software development 7.7 7.2 7% Cash flow from operations after capex & software capitalization 47.9 49.2 (3%) Cash flow from operation after capex and softwa
Slide 19: Cash Movement and Liquidity
Cash Movement and Liquidity June 30, 2018 Proceeds from Option Operating CF Exercises Other CAPEX* Liquidity 06/30/18 $201 $7 - $4 -$29 Buyback $689 -$11 Liquidity 12/31/2017 $525 * CAPEX movement includes R&D capitalization 19
Slide 20: Outlook
Q2 2018 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 21: Outlook (Non-GAAP)
Outlook* (Non-GAAP) Q3 2018 FY 2018 Revenue ($M) 347-357 1,434-1,458 EPS ($) 1.04-1.10 4.46-4.66 The outlook is provided as of August 9, 2018. There is no guarantee that the Company will change or update these figures in this presentation should a need arise in the future to update the outlook. This
Slide 22: NICE
NICE N N