Slide 1: 2019 First Quarter Results
2019 FIRST QUARTER RESULTS Ended March 31, 2019
Slide 2: Forward Looking Statements Disclaimer
Forward Looking Statements Disclaimer This presentation 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,” “inten
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, re-organization expe
Slide 4: Q1 2019 Highlights
Q1 2019 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 5: Q1 2019 Highlights (Non-GAAP)
Q1 2019 Highlights (Non-GAAP) Cloud revenue Recurring Total revenue increased 30%; revenue increased 12%; to and increased to increased to 71%; $378M 36% of total compared to 68% revenue last year Operating margin EPS increased Cash flow from Operating income increased to 25.7% 22%; to $1.18 operati
Slide 6: Income Statement
Q1 2019 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 7: Solid Growth and Execution
Solid Growth and Execution TOTAL REVENUES (Non-GAAP, $M) 378 • Total revenues grew 12% YoY 338 • Cloud revenue increased 30% • Recurring revenue represented 71% compared to 12% 68% last year • Cloud revenue represented 36% of total revenue in Q1 2019 compared to 31% in Q1 2018 Q1 18 Q1 19 EARNINGS P
Slide 8: GAAP and Non-GAAP Income Statement
GAAP and Non-GAAP Income Statement $M (except EPS) Q1 2019 Q1 2018 GAAP revenue 377.0 335.4 Valuation adjustment on acquired deferred product revenue 0.0 0.0 Valuation adjustment on acquired deferred service revenue 0.0 0.3 Valuation adjustment on acquired deferred cloud revenue 0.9 1.9 Non-GAAP rev
Slide 9: GAAP and Non-GAAP Income Statement (cont.)
GAAP and Non-GAAP Income Statement (cont.) $M (except EPS) Q1 2019 Q1 2018 GAAP taxes on income 11.4 6.7 Tax adjustment re non-GAAP adjustments 8.9 9.8 Non-GAAP taxes on income 20.3 16.5 GAAP net income 37.1 23.5 Valuation adjustment on acquired deferred revenue 0.9 2.2 Valuation adjustment on acqui
Slide 10: Revenue Breakdown by Region (Non-GAAP)
Q1 2019 Revenue Breakdown by Region (Non-GAAP) 77% 17% AMERICAS EMEA $289M, +12% YoY $64M, +18% YoY 6% APAC $25M, -5% YoY 10
Slide 11: Revenue Breakdown by Business Unit (Non-GAAP)
Q1 2019 Revenue Breakdown by Business Unit (Non-GAAP) 19% FINANCIAL CRIME & COMPLIANCE $73M, +6% YoY 81% CUSTOMER ENGAGEMENT $305M, +14% YoY 11
Slide 12: Gross Profit and Gross Margin (Non-GAAP)
Gross Profit and Gross Margin (Non-GAAP) $300 $267M 90.0% $238M $250 $200 80.0% $150 70.5% $100 70.0% 70.4% $50 60.0% $- Q1 18 Q1 19 Gross profit Gross Margin 12
Slide 13: Gross Margin Q1 2019 (Non-GAAP)
Gross Margin Q1 2019 (Non-GAAP) PRODUCT MARGIN SERVICES MARGIN CLOUD MARGIN 93.0%| +170bp 69.9%| +260bp 59.9%| -350bp Product GM Product GM Service GM 91.3% 93.0% 69.9% Service GM 67.3% Cloud GM 63.3% Cloud GM 59.8% Q1 18 Q1 19 Q1 18 Q1 19 Q1 18 Q1 19 • Product gross margin increased due to increase
Slide 14: Operating Income and Operating Margin (Non-GAAP)
Operating Income and Operating Margin (Non-GAAP) 40.0% $110 $97M $100 35.0% $90 30.0% $79M $80 25.7% Axis Title 25.0% 23.4% $70 $60 20.0% $50 15.0% $40 10.0% $30 Q1 18 Q1 19 Operating Income Operating Margin 14
Slide 15: Cost Ratio Q1 2019 (Non-GAAP)
Cost Ratio Q1 2019 (Non-GAAP) R&D S&M G&A As % of revenue As % of revenue As % of revenue S&M S&M 25.5% R&D 24.8% G&A 15.2% R&D 9.4% 14.1% 2.3%* 2.2%* 12.9% G&A 7.4% 11.9% Q1 18 Q1 19 Q1 18 Q1 19 Q1 18 Q1 19 * R&D capitalization 15
Slide 16: Balance Sheet and Cash Flow Analysis
Q1 2019 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 17: Balance Sheet
Balance Sheet March 31, 2019 Assets ($M) 03/31/2019 12/31/2018 Equity & Liabilities ($M) 03/31/2019 12/31/2018 Cash and cash equivalents 284.7 242.1 Trade payables 25.9 29.6 Short term investments 286.2 243.7 Deferred revenue and advances from customers 273.6 221.4 Trade receivables 258.9 287.9 Curr
Slide 18: Cash Flow From Operations
Cash Flow From Operations $M Q1 19 Q1 18 %∆ Cash flow from operations 182.4 136.9 33% - Capital expenditure 8.4 5.3 58% - Capitalization of software development 8.5 7.8 9% Cash flow from operations after capex & software capitalization 165.5 123.8 34% Cash flow from operation after capex and softwar
Slide 19: Cash Movement and Liquidity ($M)
Cash Movement and Liquidity ($M) March 31, 2019 Operating CF $182 Proceeds from Option Exercises Other Capex Liquidity 3/31/19 $2 $3 Buyback -$17 $891 -$10 Liquidity 12/31/18 $731 * CAPEX movement includes R&D capitalization 19
Slide 20: Outlook
Q1 2019 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 21: Outlook (Non-GAAP)
Outlook* (Non-GAAP) Q2 2019 FY 2019 Revenue ($M) 373-383 1558-1582 EPS ($) 1.16-1.26 5.11-5.31 The outlook is provided as of May 16, 2019. 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 is
Slide 22: NICE
22 NICE