Page
|
|
F-2 - F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7 - F-19
|
December 31,
2023
|
June 30,
2024
|
|||||||
Unaudited
|
||||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Short-term bank deposits
|
|
|
||||||
Marketable securities
|
|
|
||||||
Trade receivables (net of allowance for credit losses of $
|
|
|
||||||
Prepaid expenses and other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
LONG-TERM ASSETS:
|
||||||||
Marketable securities
|
|
|
||||||
Property and equipment, net
|
|
|
||||||
Intangible assets, net
|
|
|
||||||
Goodwill
|
|
|
||||||
Other long-term assets
|
|
|
||||||
Deferred tax assets
|
|
|
||||||
Total long-term assets
|
|
|
||||||
TOTAL ASSETS
|
$
|
|
$
|
|
December 31,
2023
|
June 30,
2024
|
|||||||
Unaudited
|
||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Trade payables
|
$
|
|
$
|
|
||||
Employees and payroll accruals
|
|
|
||||||
Accrued expenses and other current liabilities
|
|
|
||||||
Convertible senior notes, net
|
|
|
||||||
Deferred revenues
|
|
|
||||||
Total current liabilities
|
|
|
||||||
LONG-TERM LIABILITIES:
|
||||||||
Deferred revenues
|
|
|
||||||
Other long-term liabilities
|
|
|
||||||
Total long-term liabilities
|
|
|
||||||
TOTAL LIABILITIES
|
|
|
||||||
COMMITMENTS AND CONTINGENCIES
|
||||||||
SHAREHOLDERS' EQUITY:
|
||||||||
Ordinary shares of NIS
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
||||
Accumulated deficit
|
(
|
)
|
(
|
)
|
||||
Total shareholders' equity
|
|
|
||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
|
$
|
|
The accompanying notes are an integral part of the condensed consolidated financial statements.
U.S. dollars in thousands (except per share data and unless otherwise indicated)
Six Months Ended June 30,
|
||||||||
Unaudited
|
||||||||
2023
|
2024
|
|||||||
Revenues:
|
||||||||
Subscription
|
$
|
|
$
|
|
||||
Perpetual license
|
|
|
||||||
Maintenance and professional services
|
|
|
||||||
|
|
|||||||
Cost of revenues:
|
||||||||
Subscription
|
|
|
||||||
Perpetual license
|
|
|
||||||
Maintenance and professional services
|
|
|
||||||
|
|
|||||||
Gross profit
|
|
|
||||||
Operating expenses:
|
||||||||
Research and development
|
|
|
||||||
Sales and marketing
|
|
|
||||||
General and administrative
|
|
|
||||||
Total operating expenses
|
|
|
||||||
Operating loss
|
(
|
)
|
(
|
)
|
||||
Financial income, net
|
|
|
||||||
Loss before taxes on income
|
(
|
)
|
(
|
)
|
||||
Tax benefit (taxes on income)
|
|
(
|
)
|
|||||
Net loss
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Basic net loss per ordinary share
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Diluted net loss per ordinary share
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Other comprehensive income
|
||||||||
Change in net unrealized gains on marketable securities:
|
||||||||
Net unrealized gains arising during the period
|
|
|
||||||
|
|
|||||||
Change in unrealized net gain (loss) on cash flow hedges:
|
||||||||
Net unrealized losses arising during the period
|
(
|
)
|
(
|
)
|
||||
Net gains (losses) reclassified into net loss
|
|
(
|
)
|
|||||
|
(
|
)
|
||||||
Other comprehensive income, net of taxes of $
|
|
|
||||||
Total comprehensive loss
|
(
|
)
|
(
|
)
|
U.S. dollars in thousands (except share data and unless otherwise indicated)
Ordinary shares
|
Additional paid-in
capital
|
Accumulated other comprehensive loss
|
Retained
earnings (accumulated deficit)
|
Total
shareholders'
equity
|
||||||||||||||||||||
Shares
|
Amount
|
|||||||||||||||||||||||
Balance as of January 1, 2023
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
||||||||||||
Exercise of options and vested RSUs granted to employees
|
|
|
|
|
|
|
||||||||||||||||||
Other comprehensive income, net of tax
|
-
|
|
|
|
|
|
||||||||||||||||||
Share-based compensation
|
-
|
|
|
|
|
|
||||||||||||||||||
Issuance of ordinary shares under employee stock purchase plan
|
|
|
|
|
|
|
||||||||||||||||||
Net loss
|
-
|
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||
Balance as of June 30, 2023 (Unaudited)
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
|||||||||||
Exercise of options and vested RSUs granted to employees
|
|
|
|
|
|
|
||||||||||||||||||
Other comprehensive income, net of tax
|
-
|
|
|
|
|
|
||||||||||||||||||
Share-based compensation
|
-
|
|
|
|
|
|
||||||||||||||||||
Issuance of ordinary shares under employee stock purchase plan
|
|
|
|
|
|
|
||||||||||||||||||
Net loss
|
-
|
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||
Balance as of December 31, 2023
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
|||||||||||
Exercise of options and vested RSUs granted to employees
|
|
|
|
|
|
|
||||||||||||||||||
Other comprehensive income, net of tax
|
-
|
|
|
|
|
|
||||||||||||||||||
Share-based compensation
|
-
|
|
|
|
|
|
||||||||||||||||||
Issuance of ordinary shares under employee stock purchase plan
|
|
|
|
|
|
|
||||||||||||||||||
Conversion of Convertible Senior Notes
|
|
|
|
|
|
|
||||||||||||||||||
Net loss
|
-
|
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||
Balance as of June 30, 2024 (Unaudited)
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
U.S. dollars in thousands (except per share data and unless otherwise indicated)
Six Months Ended
June 30,
|
||||||||
Unaudited
|
||||||||
2023
|
2024
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
||||||||
Depreciation and amortization
|
|
|
||||||
Share-based compensation
|
|
|
||||||
Amortization of premium and accretion of discount on
marketable securities, net
|
(
|
)
|
(
|
)
|
||||
Impairment of available-for-sale marketable securities
|
|
|
||||||
Deferred income taxes, net
|
(
|
)
|
(
|
)
|
||||
Amortization of debt discount and issuance costs
|
|
|
||||||
Decrease in trade receivables
|
|
|
||||||
Increase in prepaid expenses, other current and long-term assets and others
|
(
|
)
|
(
|
)
|
||||
Changes in operating lease right-of-use assets
|
|
|
||||||
Increase (decrease) in trade payables
|
|
(
|
)
|
|||||
Increase in short-term and long-term deferred revenue
|
|
|
||||||
Decrease in employees and payroll accruals
|
(
|
)
|
(
|
)
|
||||
Increase in accrued expenses and other current and long-term liabilities
|
|
|
||||||
Changes in operating lease liabilities
|
(
|
)
|
(
|
)
|
||||
Net cash provided by (used in) operating activities
|
(
|
)
|
|
|||||
Cash flows from investing activities:
|
||||||||
Investment in short-term and long-term deposits
|
(
|
)
|
(
|
)
|
||||
Proceeds from short-term and long-term deposits
|
|
|
||||||
Investment in marketable securities and other
|
(
|
)
|
(
|
)
|
||||
Proceeds from sales and maturities of marketable securities and other
|
|
|
||||||
Purchase of property and equipment
|
(
|
)
|
(
|
)
|
||||
Net cash provided by investing activities
|
|
|
||||||
Cash flows from financing activities:
|
||||||||
Proceeds from (payments of) withholding tax related to employee stock plans
|
|
(
|
)
|
|||||
Proceeds from exercise of stock options
|
|
|
||||||
Proceeds in connection with employee stock purchase plan
|
|
|
||||||
Net cash provided by financing activities
|
|
|
||||||
Increase in cash and cash equivalents
|
|
|
||||||
Effect of exchange rate differences on cash and cash equivalents
|
(
|
)
|
(
|
)
|
||||
Cash and cash equivalents at the beginning of the period
|
|
|
||||||
Cash and cash equivalents at the end of the period
|
$
|
|
$
|
|
||||
Non-cash activities:
|
||||||||
Lease liabilities arising from obtaining right-of-use-assets
|
$
|
|
$
|
|
||||
Non-cash purchase of property and equipment
|
$
|
|
$
|
|
||||
Supplemental disclosure of cash flow activities:
|
||||||||
Cash paid for income taxes
|
$
|
|
$
|
|
CYBERARK SOFTWARE LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
U.S. dollars in thousands (except per share data and unless otherwise indicated)
NOTE 1:-
|
OVERVIEW, BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
|
a. |
CyberArk Software Ltd. (together with its subsidiaries, the “Company”) is an Israeli company that develops, markets and sells software-based identity security solutions and services. The Company's solutions and services secure access for any identity – human or machine – to help organizations secure critical business assets, protect their distributed workforce and customers, and accelerate business in the cloud. With CyberArk’s identity security platform, organizations can enable Zero Trust and least privilege with broad visibility, ensuring that every identity can securely access any approved resource, located anywhere, from everywhere – with a single Identity Security Platform. CyberArk has extended intelligent privilege controls across the entire identity lifecycle, for all types of identities. The CyberArk Identity Security Platform enables organizations to secure all identities – including workforce, IT, developers and machines – against cyber threats with intelligent privilege controls.
|
b. |
Basis of presentation:
|
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting and include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
|
c. |
Use of estimates:
|
F - 7
NOTE 1:- |
OVERVIEW, BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Cont.)
|
d. |
Concentration of credit risks:
|
e. |
Significant Accounting Policies:
|
f. |
Recently issued accounting standards:
|
F - 8
Six Months Ended June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
SaaS
|
$
|
|
$
|
|
||||
Self-hosted subscription*
|
|
|
||||||
Perpetual license
|
|
|
||||||
Maintenance and support
|
|
|
||||||
Professional services
|
|
|
||||||
$
|
|
$
|
|
F - 9
NOTE 2:- |
REVENUE RECOGNITION (Cont.)
|
Contract Liabilities:
F - 10
Six Months Ended
June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
Cost of revenues
|
$
|
|
$
|
(
|
)
|
|||
Research and development
|
|
(
|
)
|
|||||
Sales and marketing
|
|
(
|
)
|
|||||
General and administrative
|
|
(
|
)
|
|||||
Total gains (losses), before tax benefit (taxes on income)
|
|
(
|
)
|
|||||
Tax benefit (taxes on income)
|
(
|
)
|
|
|||||
Total gains (losses), net of tax benefit (taxes on income)
|
$ |
|
$
|
(
|
)
|
F - 11
NOTE 4:- |
MARKETABLE SECURITIES
|
December 31, 2023
|
||||||||||||||||
Amortized cost
|
Gross unrealized losses
|
Gross unrealized gains
|
Fair value
|
|||||||||||||
Corporate debentures
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||
Government debentures
|
|
(
|
)
|
|
|
|||||||||||
Total
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
June 30, 2024 (Unaudited)
|
||||||||||||||||
Amortized cost
|
Gross unrealized losses
|
Gross unrealized gains
|
Fair value
|
|||||||||||||
Corporate debentures
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||
Government debentures
|
|
(
|
)
|
|
|
|||||||||||
Total
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
December 31, 2023
|
June 30, 2024 (Unaudited)
|
|||||||||||||||
Gross unrealized losses
|
Fair value
|
Gross unrealized losses
|
Fair value
|
|||||||||||||
Continuous unrealized loss position for less than 12 months
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
|||||||
Continuous unrealized loss position for more than 12 months
|
(
|
)
|
|
(
|
)
|
|
||||||||||
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
|
F - 12
NOTE 4:- |
MARKETABLE SECURITIES (Cont.)
|
December 31, 2023
|
June 30, 2024
(Unaudited)
|
|||||||||||||||
Amortized cost
|
Fair value
|
Amortized cost
|
Fair value
|
|||||||||||||
Due within one year
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Due between one and four years
|
|
|
|
|
||||||||||||
$
|
|
$
|
|
$
|
|
$
|
|
December 31, 2023
|
June 30, 2024
(Unaudited)
|
|||||||||||||||||||||||
Level 1
|
Level 2
|
Total
|
Level 1
|
Level 2
|
Total
|
|||||||||||||||||||
Cash equivalents:
|
||||||||||||||||||||||||
Money market funds
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||
Corporate debentures and commercial paper
|
|
|
|
|
|
|
||||||||||||||||||
Government debentures
|
|
|
|
|
|
|
||||||||||||||||||
Marketable securities:
|
||||||||||||||||||||||||
Corporate debentures and commercial paper
|
|
|
|
|
|
|
||||||||||||||||||
Government debentures
|
|
|
|
|
|
|
||||||||||||||||||
Total money market funds and marketable securities measured at fair value
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
NOTE 6:- |
NON-CANCELABLE MATERIAL PURCHASE OBLIGATIONS
|
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
2027
|
|
|||
$
|
|
F - 13
NOTE 7:- |
CONVERTIBLE SENIOR NOTES, NET
|
December 31,
2023
|
June 30,
2024
|
|||||||
(Unaudited)
|
||||||||
Liability component:
|
||||||||
Remaining principal amount
|
$
|
|
$
|
|
||||
Unamortized issuance costs
|
(
|
)
|
(
|
)
|
||||
Net carrying amount
|
$
|
|
$
|
|
Six Months Ended
June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
Amortization of debt issuance costs
|
$
|
|
$
|
|
||||
Total interest expense recognized
|
$
|
|
$
|
|
F - 14
NOTE 9:- |
SHAREHOLDERS' EQUITY |
a. |
Ordinary shares:
|
b. |
Share-based compensation:
|
F - 15
NOTE 9:- |
SHAREHOLDERS' EQUITY (Cont.)
|
Under the 2024 Plan, options, restricted stock units (“RSUs”), performance share units (“PSUs”) and other share-based awards may be granted to employees, officers, non-employee consultants and directors of the Company.
Six Months Ended
June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
Cost of revenues
|
$
|
|
$
|
|
||||
Research and development
|
|
|
||||||
Sales and marketing
|
|
|
||||||
General and administrative
|
|
|
||||||
Total share-based compensation expense
|
$
|
|
$
|
|
c. |
Options granted to employees:
|
Amount
of
options
|
Weighted
average
exercise
price
|
Weighted average remaining contractual term
(in years)
|
Aggregate
intrinsic value
|
|||||||||||||
Balance as of December 31, 2023
|
|
$
|
|
|
$
|
|
||||||||||
Exercised
|
|
|
$
|
|
||||||||||||
Balance as of June 30, 2024
|
|
$
|
|
|
$
|
|
||||||||||
Exercisable as of June 30, 2024
|
|
$
|
|
|
$
|
|
F - 16
NOTE 9:- |
SHAREHOLDERS' EQUITY (Cont.)
|
The expected volatility of the Company’s ordinary shares is based on the Company’s historical volatility. The expected option term represents the period of time that options granted are expected to be outstanding, based upon historical experience.
d. |
A summary of RSUs and PSUs activity for the year ended June 30, 2024 is as follows:
|
Amount
of
RSUs and PSUs
|
Weighted
average
grant date fair value
|
|||||||
Unvested as of December 31, 2023
|
|
$
|
|
|||||
Granted
|
|
|
||||||
Vested
|
|
|
||||||
Forfeited
|
|
|
||||||
Unvested as of June 30, 2024
|
|
$
|
|
e. |
The following table summarizes the assumptions used in the Black-Scholes option pricing model to determine the fair value of the Company’s ordinary shares to be issued under the ESPP started on June 1, 2024: |
Six Months
Ended June 30,
|
||||
ESPP
|
2024
|
|||
Expected volatility
|
|
%
|
||
Expected dividends
|
|
%
|
||
Expected term (in years)
|
|
|||
Risk free rate
|
|
%
|
F - 17
NOTE 10:- |
BASIC AND DILUTED NET LOSS PER SHARE |
Six Months Ended
June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
Numerator:
|
||||||||
Net loss available to shareholders of ordinary shares
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Denominator:
|
||||||||
Shares used in computing basic and diluted net loss per ordinary shares
|
|
|
NOTE 11:- |
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION |
a. |
The Company identifies operating segments in accordance with ASC Topic 280, "Segment Reporting". Operating segments are defined as components of an entity for which separate financial information is available and is regularly reviewed by the chief operating decision maker in making decisions regarding resource allocation and evaluating financial performance. The Company determined it operates in one reportable segment as the Company's chief operating decision maker is the Chief Executive Officer who makes operating decisions, assesses performance and allocates resources on a consolidated basis.
|
b. |
The total revenues are attributed to geographic areas based on the location of the Company's channel partners which are considered as end customers, as well as direct customers of the Company.
|
F - 18
NOTE 11:- |
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION (Cont.) |
Six Months Ended
June 30,
|
||||||||
2023
|
2024
|
|||||||
(Unaudited)
|
||||||||
United States
|
$
|
|
$
|
|
||||
Israel
|
|
|
||||||
United Kingdom
|
|
|
||||||
Europe, the Middle East and Africa *
|
|
|
||||||
Other
|
|
|
||||||
$
|
|
$
|
|
NOTE 12:- |
SUBSEQUENT EVENTS |
a. |
On October 1, 2024, the Company completed the acquisition of Venafi Holdings, Inc., a leader in machine identity management, and its subsidiaries (collectively, “Venafi”). This acquisition will combine Venafi’s machine identity management capabilities with the Company’s leading identity security capabilities to establish a unified platform for end-to-end machine identity security at enterprise scale.
|