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99.1
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Press Release: NICE Reports $226 Million Non-GAAP Revenue and $0.81 Non-GAAP EPS for the First Quarter 2016, Dated May 5, 2016
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NICE-SYSTEMS LTD.
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By:
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/s/ Eran Porat
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Name:
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Eran Porat
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Title:
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Corporate VP Finance
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Dated May 5, 2016
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99.1
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Press Release: NICE Reports $226 Million Non-GAAP Revenue and $0.81 Non-GAAP EPS for the First Quarter 2016, Dated May 5, 2016
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•
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Revenues of $226.1 million, up 4.3% year-over-year
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Gross margin of 70.6%, up from 69.8% last year
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Operating income of $57.8 million, up 14.6% year-over-year
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Operating margin of 25.6%, up from 23.3% last year
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Fully diluted earnings per share of $0.81, up 17.4% year-over-year
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•
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Record cash from operations of $112.8 million, compared to $104.1 million last year
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NICE SYSTEMS LTD. AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF INCOME
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U.S. dollars in thousands (except per share amounts)
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Quarter ended
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||||||||
March 31,
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||||||||
2016
|
2015
|
|||||||
Unaudited
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Unaudited
|
|||||||
Revenue:
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||||||||
Product
|
$ | 65,117 | $ | 72,918 | ||||
Services
|
160,850 | 143,646 | ||||||
Total revenue
|
225,967 | 216,564 | ||||||
Cost of revenue:
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||||||||
Product
|
13,734 | 16,416 | ||||||
Services
|
60,735 | 56,716 | ||||||
Total cost of revenue
|
74,469 | 73,132 | ||||||
Gross profit
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151,498 | 143,432 | ||||||
Operating Expenses:
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||||||||
Research and development, net
|
32,521 | 30,145 | ||||||
Selling and marketing
|
55,783 | 55,414 | ||||||
General and administrative
|
23,192 | 21,210 | ||||||
Amortization of acquired intangible assets
|
2,507 | 3,454 | ||||||
Total operating expenses
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114,003 | 110,223 | ||||||
Operating income
|
37,495 | 33,209 | ||||||
Finance and other income, net
|
3,765 | 1,937 | ||||||
Income from continuing operations before tax
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41,260 | 35,146 | ||||||
Taxes on income
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6,003 | 6,564 | ||||||
Net income from continuing operations
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35,257 | 28,582 | ||||||
Discontinued operations
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||||||||
Income (loss) from discontinued operations
|
(117 | ) | 918 | |||||
Taxes on income
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- | 263 | ||||||
Net income (loss) from discontinued operations
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(117 | ) | 655 | |||||
Net income
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$ | 35,140 | $ | 29,237 | ||||
Basic earnings per share from continuing operations
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$ | 0.59 | $ | 0.48 | ||||
Basic earnings (loss) per share from discontinued operations
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$ | (0.00 | ) | $ | 0.01 | |||
Basic earnings per share
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$ | 0.59 | $ | 0.49 | ||||
Diluted earnings per share from continuing operations
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$ | 0.58 | $ | 0.47 | ||||
Diluted earnings (loss) per share from discontinued operations
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$ | (0.00 | ) | $ | 0.01 | |||
Diluted earnings per share
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$ | 0.58 | $ | 0.48 | ||||
Weighted average number of shares
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||||||||
outstanding used to compute:
|
||||||||
Basic earnings (loss) per share
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59,433 | 59,371 | ||||||
Diluted earnings (loss) per share
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60,851 | 61,203 |
NICE SYSTEMS LTD. AND SUBSIDIARIES
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RECONCILIATION OF GAAP TO NON-GAAP RESULTS
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U.S. dollars in thousands (except per share amounts)
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Quarter ended
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||||||||
March 31,
|
||||||||
2016
|
2015
|
|||||||
GAAP revenues
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$ | 225,967 | $ | 216,564 | ||||
Valuation adjustment on acquired deferred product revenue
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84 | - | ||||||
Valuation adjustment on acquired deferred service revenue
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58 | 123 | ||||||
Non-GAAP revenues
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$ | 226,109 | $ | 216,687 | ||||
GAAP cost of revenue
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$ | 74,469 | $ | 73,132 | ||||
Amortization of acquired intangible assets on cost of product
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(6,291 | ) | (6,823 | ) | ||||
Cost of product revenue adjustment (1)
|
(121 | ) | (133 | ) | ||||
Cost of services revenue adjustment (1,2)
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(1,604 | ) | (799 | ) | ||||
Non-GAAP cost of revenue
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$ | 66,453 | $ | 65,377 | ||||
GAAP gross profit
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$ | 151,498 | $ | 143,432 | ||||
Gross profit adjustments
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8,158 | 7,878 | ||||||
Non-GAAP gross profit
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$ | 159,656 | $ | 151,310 | ||||
GAAP operating expenses
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$ | 114,003 | $ | 110,223 | ||||
Research and development (1,2,3)
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(1,982 | ) | (496 | ) | ||||
Sales and marketing (1,3)
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(3,346 | ) | (2,626 | ) | ||||
General and administrative (1,2,3)
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(4,351 | ) | (2,822 | ) | ||||
Amortization of acquired intangible assets
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(2,507 | ) | (3,454 | ) | ||||
Non-GAAP operating expenses
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$ | 101,817 | $ | 100,825 | ||||
GAAP taxes on income
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$ | 6,003 | $ | 6,564 | ||||
Tax adjustments re non-GAAP adjustments
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6,009 | 3,520 | ||||||
Non-GAAP taxes on income
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$ | 12,012 | $ | 10,084 | ||||
GAAP net income (loss) from continuing operations
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$ | 35,257 | $ | 28,582 | ||||
Valuation adjustment on acquired deferred revenue
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142 | 123 | ||||||
Amortization of acquired intangible assets
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8,798 | 10,277 | ||||||
Share-based compensation (1)
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6,360 | 6,876 | ||||||
Re-organization expenses (2)
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1,308 | - | ||||||
Acquisition related expenses (3)
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3,736 | - | ||||||
Tax adjustments re non-GAAP adjustments
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(6,009 | ) | (3,520 | ) | ||||
Non-GAAP net income from continuing operations
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$ | 49,592 | $ | 42,338 | ||||
GAAP diluted earnings per share from continuing operations
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$ | 0.58 | $ | 0.47 | ||||
Non-GAAP diluted earnings per share from continuing operations
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$ | 0.81 | $ | 0.69 | ||||
Shares used in computing GAAP diluted earnings per share
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60,851 | 61,203 | ||||||
Shares used in computing Non-GAAP diluted earnings per share
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60,851 | 61,203 |
NICE SYSTEMS LTD. AND SUBSIDIARIES
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RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued)
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U.S. dollars in thousands
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(1 | ) |
Share-based Compensation
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|||||||||
Quarter ended
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March 31,
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|||||||||||
2016 | 2015 | ||||||||||
Cost of product revenue
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$ | (121 | ) | $ | (133 | ) | |||||
Cost of service revenue
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(1,406 | ) | (799 | ) | |||||||
Research and development
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(856 | ) | (496 | ) | |||||||
Sales and marketing
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(2,859 | ) | (2,626 | ) | |||||||
General and administrative
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(1,118 | ) | (2,822 | ) | |||||||
$ | (6,360 | ) | $ | (6,876 | ) | ||||||
(2 | ) |
Re-organization expenses
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Quarter ended
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March 31,
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|||||||||||
2016 | 2015 | ||||||||||
Cost of service revenue
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$ | (198 | ) | $ | - | ||||||
Research and development
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(1,102 | ) | - | ||||||||
General and administrative
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(8 | ) | - | ||||||||
$ | (1,308 | ) | $ | - | |||||||
(3 | ) |
Acquisition related expenses
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Quarter ended
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March 31,
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|||||||||||
2016 | 2015 | ||||||||||
Research and development
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$ | (24 | ) | $ | - | ||||||
Sales and marketing
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(487 | ) | - | ||||||||
General and administrative
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(3,225 | ) | - | ||||||||
$ | (3,736 | ) | $ | - |
NICE SYSTEMS LTD. AND SUBSIDIARIES
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CONDENSED CONSOLIDATED BALANCE SHEETS
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U.S. dollars in thousands
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March 31,
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December 31,
|
|||||||
2016
|
2015
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|||||||
Unaudited
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Unaudited
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ASSETS
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CURRENT ASSETS:
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Cash and cash equivalents
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$ | 269,713 | $ | 325,931 | ||||
Short-term investments
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80,722 | 99,195 | ||||||
Trade receivables
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149,035 | 177,323 | ||||||
Prepaid expenses and other current assets
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51,548 | 43,561 | ||||||
Current assets of discontinued operations
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8,714 | 9,142 | ||||||
Total current assets
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559,732 | 655,152 | ||||||
LONG-TERM ASSETS:
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Long-term investments
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414,713 | 403,249 | ||||||
Other long-term assets
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17,119 | 17,175 | ||||||
Property and equipment, net
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44,997 | 39,213 | ||||||
Deferred tax assets
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14,650 | 14,130 | ||||||
Other intangible assets, net
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142,730 | 69,582 | ||||||
Goodwill
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734,434 | 651,112 | ||||||
Total long-term assets
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1,368,643 | 1,194,461 | ||||||
TOTAL ASSETS
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$ | 1,928,375 | $ | 1,849,613 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY
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CURRENT LIABILITIES:
|
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Trade payables
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$ | 14,976 | $ | 11,719 | ||||
Deferred revenues and advances from customers
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196,426 | 151,345 | ||||||
Accrued expenses and other liabilities
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219,087 | 223,255 | ||||||
Current liabilities of discontinued operations
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13,072 | 12,744 | ||||||
Total current liabilities
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443,561 | 399,063 | ||||||
LONG-TERM LIABILITIES:
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Deferred tax liabilities
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25,437 | 15,040 | ||||||
Other long-term liabilities
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19,641 | 17,952 | ||||||
Long-term liabilities of discontinued operations
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2,409 | 2,409 | ||||||
Total long-term liabilities
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47,487 | 35,401 | ||||||
SHAREHOLDERS' EQUITY
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1,437,327 | 1,415,149 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
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$ | 1,928,375 | $ | 1,849,613 |
NICE SYSTEMS LTD. AND SUBSIDIARIES
|
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CONSOLIDATED CASH FLOW STATEMENTS
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U.S. dollars in thousands
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Quarter ended
|
||||||||
March 31,
|
||||||||
2016
|
2015
|
|||||||
Unaudited
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Unaudited
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Operating Activities
|
||||||||
Net income
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$ | 35,140 | $ | 29,237 | ||||
Adjustments to reconcile net income to net cash provided by operating activities
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Depreciation and amortization
|
12,916 | 15,076 | ||||||
Stock based compensation
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6,431 | 7,212 | ||||||
Excess tax benefit from share-based payment arrangements
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(1,681 | ) | (638 | ) | ||||
Amortization of premium and discount and accrued interest on marketable securities
|
969 | 646 | ||||||
Deferred taxes, net
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(3,586 | ) | (3,520 | ) | ||||
Changes in operating assets and liabilities:
|
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Trade receivables
|
39,568 | 36,320 | ||||||
Prepaid expenses and other current assets
|
13,036 | (3,455 | ) | |||||
Trade payables
|
861 | 1,140 | ||||||
Accrued expenses and other current liabilities
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(26,714 | ) | (26,847 | ) | ||||
Deferred revenue
|
35,688 | 48,926 | ||||||
Other
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191 | 37 | ||||||
Net cash provided by operating activities
|
112,819 | 104,134 | ||||||
Investing Activities
|
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Purchase of property and equipment
|
(7,077 | ) | (3,219 | ) | ||||
Proceeds from sale of property and equipment
|
18 | - | ||||||
Purchase of Investments
|
(27,952 | ) | (85,983 | ) | ||||
Proceeds from Investments
|
39,118 | 30,982 | ||||||
Capitalization of software development costs
|
(1,061 | ) | - | |||||
Payments for business acquisitions, net of cash acquired
|
(150,453 | ) | - | |||||
Net cash used in investing activities
|
(147,407 | ) | (58,220 | ) | ||||
Financing Activities
|
||||||||
Proceeds from issuance of shares upon exercise of share options and ESPP
|
7,514 | 9,015 | ||||||
Purchase of treasury shares
|
(22,673 | ) | (6,288 | ) | ||||
Dividends paid
|
(9,517 | ) | (9,586 | ) | ||||
Excess tax benefit from share-based payment arrangements
|
1,681 | 638 | ||||||
Earnout payments related to acquisitions
|
- | (262 | ) | |||||
Net cash used in financing activities
|
(22,995 | ) | (6,483 | ) | ||||
Effect of exchange rates on cash and cash equivalents
|
1,365 | (4,437 | ) | |||||
Net change in cash and cash equivalents
|
(56,218 | ) | 34,994 | |||||
Cash and cash equivalents, beginning of period
|
325,931 | 187,497 | ||||||
Cash and cash equivalents, end of period
|
$ | 269,713 | $ | 222,491 |