|
|
5 Ha’solelim Street, Tel Aviv, Israel
(Address of principal executive offices)
|
Investors: Kip E. Meintzer
Check Point Software Technologies
+1.650.628.2040
ir@checkpoint.com
|
Media: Ekram Ahmed
Check Point Software Technologies
+1.650.628.2260
press@checkpoint.com
|
• |
Total Revenue: $488 million, a 4 percent increase year over year
|
• |
Deferred Revenues: $1,286 million, an 11 percent increase year over year
|
• |
GAAP Operating Income: $213 million, representing 44 percent of revenues
|
• |
Non-GAAP Operating Income: $242 million, representing 50 percent of revenues
|
• |
GAAP EPS: $1.21, Non-GAAP EPS: $1.38
|
• |
Total Revenue: $488 million compared to $468 million in the second quarter of 2018, a 4 percent increase year over year.
|
• |
GAAP Operating Income: $213 million compared to $224 million in the second quarter of 2018, representing 44 percent and 48 percent of revenues in the second quarter of 2019 and 2018,
respectively.
|
• |
Non-GAAP Operating Income: $242 million compared to $247 million in the second quarter of 2018, representing 50 percent and 53 percent of revenues in the second quarter of 2019 and 2018,
respectively.
|
• |
GAAP Taxes on Income: $48 million compared to $43 million in the second quarter of 2018.
|
• |
GAAP Net Income and Earnings per Diluted Share: GAAP net income was $186 million compared to $198 million in the second quarter of 2018. GAAP earnings per diluted share were $1.21 compared to
$1.24 in the second quarter of 2018.
|
• |
Non-GAAP Net Income and Earnings per Diluted Share: Non-GAAP net income was $211 million compared to $218 million in the second quarter of 2018. Non-GAAP earnings per diluted share were $1.38
compared to $1.37 in second quarter of 2018, a 1 percent increase year over year.
|
• |
Deferred Revenues: As of June 30, 2019, deferred revenues were $1,286 million compared to $1,158 million as of June 30, 2018, an 11 percent increase year over year.
|
• |
Cash Balances, Marketable Securities and Short Term Deposits: $4,110 million as of June 30, 2019, compared to $4,042 million as of June 30, 2018.
|
• |
Cash Flow: Cash flow from operations of $233 million compared to $213 million in the second quarter of 2018, a 9 percent increase year over year.
|
• |
Share Repurchase Program: During the second quarter of 2019, the company repurchased approximately 2.8 million shares at a total cost of approximately $325 million.
|
• |
KeyBanc Capital Markets 21st Annual Global Technology
Leadership Forum
August 12, 2019 – Vail, CO |
• |
Citi 2019 Global Technology Conference
September 4, 2019 – New York, NY |
• |
Deutsche Bank 2019 Technology Conference
September 10-11, 2019 – Las Vegas, NV (Meetings Only) |
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
Revenues:
|
||||||||||||||||
Products and licenses
|
$
|
121,825
|
$
|
125,666
|
$
|
234,622
|
$
|
243,805
|
||||||||
Security subscriptions
|
148,663
|
132,076
|
292,638
|
259,327
|
||||||||||||
Total revenues from products and security subscriptions
|
270,488
|
257,742
|
527,260
|
503,132
|
||||||||||||
Software updates and maintenance
|
217,628
|
210,028
|
432,684
|
416,964
|
||||||||||||
Total revenues
|
488,116
|
467,770
|
959,944
|
920,096
|
||||||||||||
Operating expenses:
|
||||||||||||||||
Cost of products and licenses
|
21,368
|
21,595
|
40,991
|
40,973
|
||||||||||||
Cost of security subscriptions
|
6,478
|
4,085
|
11,760
|
7,726
|
||||||||||||
Total cost of products and security subscriptions
|
27,846
|
25,680
|
52,751
|
48,699
|
||||||||||||
Cost of Software updates and maintenance
|
23,148
|
22,381
|
45,836
|
43,058
|
||||||||||||
Amortization of technology
|
1,388
|
546
|
2,776
|
1,092
|
||||||||||||
Total cost of revenues
|
52,382
|
48,607
|
101,363
|
92,849
|
||||||||||||
Research and development
|
58,875
|
50,289
|
116,509
|
103,652
|
||||||||||||
Selling and marketing
|
138,300
|
124,493
|
273,340
|
244,251
|
||||||||||||
General and administrative
|
26,026
|
20,421
|
50,138
|
41,959
|
||||||||||||
Total operating expenses
|
275,583
|
243,810
|
541,350
|
482,711
|
||||||||||||
Operating income
|
212,533
|
223,960
|
418,594
|
437,385
|
||||||||||||
Financial income, net
|
20,890
|
16,415
|
39,798
|
31,275
|
||||||||||||
Income before taxes on income
|
233,423
|
240,375
|
458,392
|
468,660
|
||||||||||||
Taxes on income
|
47,889
|
42,689
|
92,926
|
83,834
|
||||||||||||
Net income
|
$
|
185,534
|
$
|
197,686
|
$
|
365,466
|
$
|
384,826
|
||||||||
Basic earnings per share
|
$
|
1.22
|
$
|
1.26
|
$
|
2.38
|
$
|
2.44
|
||||||||
Number of shares used in computing basic earnings per share
|
152,019
|
156,982
|
153,472
|
157,571
|
||||||||||||
Diluted earnings per share
|
$
|
1.21
|
$
|
1.24
|
$
|
2.36
|
$
|
2.40
|
||||||||
Number of shares used in computing diluted earnings per share
|
153,687
|
159,669
|
155,156
|
160,674
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
Revenues
|
$
|
488,116
|
$
|
467,770
|
$
|
959,944
|
$
|
920,096
|
||||||||
Non-GAAP operating income
|
241,800
|
247,123
|
476,714
|
486,121
|
||||||||||||
Non-GAAP net income
|
211,474
|
218,183
|
416,929
|
428,074
|
||||||||||||
Diluted Non-GAAP Earnings per share
|
$
|
1.38
|
$
|
1.37
|
$
|
2.69
|
$
|
2.67
|
||||||||
Number of shares used in computing diluted Non-GAAP earnings per share
|
153,687
|
159,669
|
155,156
|
160,674
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
GAAP operating income
|
$
|
212,533
|
$
|
223,960
|
$
|
418,594
|
$
|
437,385
|
||||||||
Stock-based compensation (1)
|
25,974
|
20,827
|
50,806
|
43,141
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
3,293
|
2,336
|
7,314
|
5,595
|
||||||||||||
Non-GAAP operating income
|
$
|
241,800
|
$
|
247,123
|
$
|
476,714
|
$
|
486,121
|
||||||||
GAAP net income
|
$
|
185,534
|
$
|
197,686
|
$
|
365,466
|
$
|
384,826
|
||||||||
Stock-based compensation (1)
|
25,974
|
20,827
|
50,806
|
43,141
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
3,293
|
2,336
|
7,314
|
5,595
|
||||||||||||
Taxes on the above items (3)
|
(3,327
|
)
|
(2,666
|
)
|
(6,657
|
)
|
(5,488
|
)
|
||||||||
Non-GAAP net income
|
$
|
211,474
|
$
|
218,183
|
$
|
416,929
|
$
|
428,074
|
||||||||
Diluted GAAP Earnings per share
|
$
|
1.21
|
$
|
1.24
|
$
|
2.36
|
$
|
2.40
|
||||||||
Stock-based compensation (1)
|
0.17
|
0.13
|
0.33
|
0.27
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
0.02
|
0.02
|
0.04
|
0.04
|
||||||||||||
Taxes on the above items (3)
|
(0.02
|
)
|
(0.02
|
)
|
(0.04
|
)
|
(0.04
|
)
|
||||||||
Diluted Non-GAAP Earnings per share
|
$
|
1.38
|
$
|
1.37
|
$
|
2.69
|
$
|
2.67
|
||||||||
Number of shares used in computing diluted Non-GAAP earnings per share
|
153,687
|
159,669
|
155,156
|
160,674
|
||||||||||||
(1) Stock-based compensation:
|
||||||||||||||||
Cost of products and licenses
|
$
|
35
|
$
|
39
|
$
|
68
|
$
|
76
|
||||||||
Cost of software updates and maintenance
|
1,000
|
851
|
1,939
|
1,537
|
||||||||||||
Research and development
|
4,704
|
4,212
|
9,007
|
8,248
|
||||||||||||
Selling and marketing
|
6,219
|
4,448
|
12,305
|
9,738
|
||||||||||||
General and administrative
|
14,016
|
11,277
|
27,487
|
23,542
|
||||||||||||
25,974
|
20,827
|
50,806
|
43,141
|
|||||||||||||
(2) Amortization of intangible assets and acquisition related expenses:
|
||||||||||||||||
Amortization of technology-cost of revenues
|
1,388
|
546
|
2,776
|
1,092
|
||||||||||||
Research and development
|
1,511
|
974
|
3,525
|
2,871
|
||||||||||||
Selling and marketing
|
394
|
816
|
1,013
|
1,632
|
||||||||||||
3,293
|
2,336
|
7,314
|
5,595
|
|||||||||||||
(3) Taxes on the above items
|
(3,327
|
)
|
(2,666
|
)
|
(6,657
|
)
|
(5,488
|
)
|
||||||||
Total, net
|
$
|
25,940
|
$
|
20,497
|
$
|
51,463
|
$
|
43,248
|
June 30,
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
249,101
|
$
|
303,687
|
||||
Marketable securities and short-term deposits
|
1,366,217
|
1,448,092
|
||||||
Trade receivables, net
|
320,622
|
495,390
|
||||||
Prepaid expenses and other current assets
|
80,942
|
74,738
|
||||||
Total current assets
|
2,016,882
|
2,321,907
|
||||||
Long-term assets:
|
||||||||
Marketable securities
|
2,494,259
|
2,287,345
|
||||||
Property and equipment, net
|
85,996
|
78,514
|
||||||
Deferred tax asset, net
|
65,654
|
84,688
|
||||||
Goodwill and other intangible assets, net
|
993,731
|
991,539
|
||||||
Other assets
|
91,277
|
64,220
|
||||||
Total long-term assets
|
3,730,917
|
3,506,306
|
||||||
Total assets
|
$
|
5,747,799
|
$
|
5,828,213
|
Current liabilities:
|
||||||||
Deferred revenues
|
$
|
939,514
|
$
|
980,175
|
||||
Trade payables and other accrued liabilities
|
358,544
|
351,695
|
||||||
Total current liabilities
|
1,298,058
|
1,331,870
|
||||||
Long-term liabilities:
|
||||||||
Long-term deferred revenues
|
346,889
|
357,779
|
||||||
Income tax accrual
|
406,944
|
356,750
|
||||||
Other long-term liabilities
|
33,847
|
9,425
|
||||||
787,680
|
723,954
|
|||||||
Total liabilities
|
2,085,738
|
2,055,824
|
||||||
Shareholders’ equity:
|
||||||||
Share capital
|
774
|
774
|
||||||
Additional paid-in capital
|
1,692,077
|
1,597,800
|
||||||
Treasury shares at cost
|
(7,455,122
|
)
|
(6,844,702
|
)
|
||||
Accumulated other comprehensive gain (loss)
|
15,852
|
(24,497
|
)
|
|||||
Retained earnings
|
9,408,480
|
9,043,014
|
||||||
Total shareholders’ equity
|
3,662,061
|
3,772,389
|
||||||
Total liabilities and shareholders’ equity
|
$
|
5,747,799
|
$
|
5,828,213
|
||||
Total cash and cash equivalents, marketable securities and short-term deposits
|
$
|
4,109,577
|
$
|
4,039,124
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2019
|
2018
|
2019
|
2018
|
|||||||||||||
Cash flow from operating activities:
|
||||||||||||||||
Net income
|
$
|
185,534
|
$
|
197,686
|
$
|
365,466
|
$
|
384,826
|
||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||||||
Depreciation of property and equipment
|
3,644
|
4,144
|
7,219
|
8,032
|
||||||||||||
Amortization of intangible assets
|
1,782
|
940
|
3,564
|
1,880
|
||||||||||||
Stock-based compensation
|
25,974
|
20,827
|
50,806
|
43,141
|
||||||||||||
Realized loss on marketable securities
|
9
|
87
|
486
|
89
|
||||||||||||
Decrease (increase) in trade and other receivables, net
|
(6,787
|
)
|
341
|
174,537
|
181,736
|
|||||||||||
Increase (decrease) in deferred revenues, trade payables and other accrued liabilities
|
19,905
|
(12,013
|
)
|
3,182
|
7,194
|
|||||||||||
Deferred income taxes, net
|
2,736
|
1,096
|
6,289
|
5,043
|
||||||||||||
Net cash provided by operating activities
|
232,797
|
213,108
|
611,549
|
631,941
|
||||||||||||
Cash flow from investing activities:
|
||||||||||||||||
Cash paid in conjunction with acquisitions, net of acquired cash
|
-
|
-
|
(5,509
|
)
|
-
|
|||||||||||
Investment in property and equipment
|
(5,121
|
)
|
(4,767
|
)
|
(14,701
|
)
|
(9,439
|
)
|
||||||||
Net cash used in investing activities
|
(5,121
|
)
|
(4,767
|
)
|
(20,210
|
)
|
(9,439
|
)
|
||||||||
Cash flow from financing activities:
|
||||||||||||||||
Proceeds from issuance of shares upon exercise of options
|
11,709
|
79,152
|
63,000
|
99,097
|
||||||||||||
Purchase of treasury shares
|
(324,955
|
)
|
(249,549
|
)
|
(629,949
|
)
|
(498,957
|
)
|
||||||||
Payments related to shares withheld for taxes
|
(4,444
|
)
|
(3,124
|
)
|
(5,092
|
)
|
(3,423
|
)
|
||||||||
Net cash used in financing activities
|
(317,690
|
)
|
(173,521
|
)
|
(572,041
|
)
|
(403,283
|
)
|
||||||||
Unrealized gain (loss) on marketable securities, net
|
24,920
|
(2,169
|
)
|
51,155
|
(25,559
|
)
|
||||||||||
Increase (decrease) in cash and cash equivalents, marketable securities and short term deposits
|
(65,094
|
)
|
32,651
|
70,453
|
193,660
|
|||||||||||
Cash and cash equivalents, marketable securities and short term deposits at the beginning of the period
|
4,174,671
|
4,009,054
|
4,039,124
|
3,848,045
|
||||||||||||
Cash and cash equivalents, marketable securities and short term deposits at the end of the period
|
$
|
4,109,577
|
$
|
4,041,705
|
$
|
4,109,577
|
$
|
4,041,705
|
CHECK POINT SOFTWARE TECHNOLOGIES LTD. | |||
|
By:
|
/s/ Tal Payne | |
Tal Payne | |||
July 24, 2019
|
Chief Financial Officer & Chief Operating Officer |