0001104659-05-049809.txt : 20051024 0001104659-05-049809.hdr.sgml : 20051024 20051024161031 ACCESSION NUMBER: 0001104659-05-049809 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20051024 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051024 DATE AS OF CHANGE: 20051024 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RIGHTNOW TECHNOLOGIES INC CENTRAL INDEX KEY: 0001111247 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 810503640 STATE OF INCORPORATION: MT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-31321 FILM NUMBER: 051152194 BUSINESS ADDRESS: STREET 1: 40 ENTERPRISE BLVD. CITY: BOZEMAN STATE: MT ZIP: 59718 BUSINESS PHONE: 406 522 2952 MAIL ADDRESS: STREET 1: 40 ENTERPRISE BLVD. CITY: BOZEMAN STATE: MT ZIP: 59718 8-K 1 a05-18826_18k.htm 8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 24, 2005

RIGHTNOW TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in Charter)

DELAWARE	000-31321	81-0503640
(State or Other Jurisdiction	(Commission	(IRS Employer
of Incorporation)	File Number)	Identification No.)

40 ENTERPRISE BOULEVARD, BOZEMAN, MT		59718
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code (406) 522-4200

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On October 24, 2005, RightNow Technologies, Inc. (the “company”) issued a press release announcing its financial results for the third quarter ended September 30, 2005. A copy of the press release is furnished herewith as Exhibit No. 99.1.

The company also has posted on its website supplemental financial data, as of October 24, 2005, a copy of which is furnished herewith as Exhibit No. 99.2.

The information contained in this report and in the exhibits attached to this report is being furnished to the Securities and Exchange Commission and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that Section, or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(a) Not Applicable.

(b) Not Applicable.

Exhibit No.		Description of Exhibit

99.1		Press Release, dated October 24, 2005, announcing RightNow Technologies, Inc.’s financial results for the third quarter ended September 30, 2005 (furnished herewith but not filed pursuant to Item 2.02).

99.2		Supplemental financial data of RightNow Technologies, Inc., as of October 24, 2005 (furnished herewith but not filed pursuant to Item 2.02).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	RIGHTNOW TECHNOLOGIES, INC.
	(Registrant)

Dated: October 24, 2005	/s/ SUSAN J. CARSTENSEN
	Susan J. Carstensen Chief Financial Officer, Vice President, Treasurer and Assistant Secretary

EXHIBIT INDEX

Exhibit No.		Description of Exhibit

99.1		Press Release, dated October 24, 2005, announcing RightNow Technologies, Inc.’s financial results for the third quarter ended September 30, 2005 (furnished herewith but not filed pursuant to Item 2.02).

99.2		Supplemental financial data of RightNow Technologies, Inc. as of October 24, 2005 (furnished herewith but not filed pursuant to Item 2.02).

EX-99.1 2 a05-18826_1ex99d1.htm EX-99.1

Exhibit 99.1

40 Enterprise Boulevard

PO Box 9300

Bozeman, MT 59718-9300

406.522.4200 P

406.522.4227 F

FOR IMMEDIATE RELEASE

For Further Information, Contact:
Investor Relations:	Corporate Communications:
Todd Friedman or Stacie Bosinoff	Jason Treu
The Blueshirt Group	RightNow Technologies
415.217.5869/5868	972.232.3977 Desk
todd@blueshirtgroup.com	214.893.3096 Cell
Stacie@blueshirtgroup.com	jtreu@rightnow.com

RIGHTNOW TECHNOLOGIES REPORTS

THIRD QUARTER 2005 FINANCIAL RESULTS

BOZEMAN, MONT. (October 24, 2005)¾RightNow^® Technologies, Inc. (NASDAQ: RNOW), a leading provider of on demand CRM software solutions, today announced results for the third quarter ended September 30, 2005. RightNow reported consolidated revenue of $23.2 million for the third quarter of 2005, an increase of 41 percent from the third quarter of 2004. This represents the 31st consecutive quarter of revenue growth for RightNow.

Net income in the third quarter of 2005 was $2.3 million, or $0.07 per diluted share, compared to net income of $1.4 million, or $0.05 per diluted share, in the third quarter of 2004.

For the nine months ended September 30, 2005, RightNow reported revenue of $62.6 million and diluted earnings per share of $0.14, as compared to year-ago revenue of $44 million and diluted earnings per share of $0.08.

At September 30, 2005 deferred revenue totaled $63.8 million, or 43 percent more than one year earlier. Cash from operations for the nine months ended September 30, 2005 was $11.1 million as compared to $3.4 million for the similar period of 2004.

“The CRM market is undergoing revolutionary change, as companies both large and small are realizing the benefits that on demand solutions deliver,” Greg Gianforte, founder and chief executive officer of RightNow, said. “Not only is on demand a disruptive force in all IT departments, but the product confusion created by the Oracle/PeopleSoft/JD Edwards/Retek/Siebel combination has created a leadership and technology vacuum among large enterprises looking to adopt CRM solutions that RightNow is uniquely capable of filling.

“RightNow’s record revenue in the third quarter was driven by the strength and scalability of our product suite, which is gaining momentum across a diverse universe of industries and companies. We are especially encouraged by our success establishing beachheads in large businesses, and then earning the right to expand those deployments through our award-winning technology and unmatched focus on customer satisfaction. We believe that our growth thus far in 2005 is a result of our unique focus and willingness to be accountable for our customers’ success, and we are optimistic about our growth opportunities for the rest of 2005 and beyond.”

RightNow added more than 90 new customers in the third quarter of 2005. New, renewed and expanded customer relationships during the quarter included Aflac, Department of Homeland Security, Enterprise Rent-A-Car, Nationwide Building Society, Sage UK Ltd, Telstra Mobiles, and the University of New Mexico.

“Our business model continues to draw strength from our industry-leading customer retention rate of more than 90%, which drives higher profitability and allows us to reach a wider potential audience through strong customer referrals. We ended the quarter with more than 1,400 active customers, notable especially for the growing number of large enterprise customers in the mix. Our year-to-date operating cash flow

has also increased by more than 220% over the prior year,” Susan Carstensen, chief financial officer of RightNow, said.

Guidance

• For the fourth quarter of 2005, assuming a target mix of 50% to 60% recurring revenue, 20% to 25% perpetual revenue, and 20% to 25% professional services revenue, total revenue is expected to be in the range of $23 to $24 million. EPS is expected to be in the range of $0.02 to $0.04 cents.

• ; For the full year 2005, revenue is expected to be in the range of $85.5 to $86.5 million, and EPS in the range of $0.16 to $0.18 cents.

• The Company will provide 2006 guidance in its quarterly conference call.

Quarterly Conference Call

RightNow Technologies will discuss its quarterly results via teleconference at 4:30 p.m. (ET)/2:30 p.m. (MT) today, October 24, 2005. To access the call, please dial (800) 810-0924 at least five minutes prior to the start time. An audio webcast of the call will also be available at www.shareholder.com/rnow/medialist.cfm. A replay of today’s conference call will be available by calling (888) 203-1112, or on the company Web site at www.rightnow.com, under the Investor Webcasts menu, by 5:30 p.m. (MT) on October 24, 2005. The replay will be available through Monday, November 7, 2005.

Historical Financial and Supplementary Information

Current quarter consolidated financial statements are included with this press release. To view the company’s historical quarterly consolidated financial statements and supplementary data, please visit www.rightnow.com.

About RightNow Technologies, Inc.

RightNow (NASDAQ: RNOW) provides organizations with industry-leading on demand CRM solutions to build customer-focused businesses. RightNow’s acclaimed technology, comprehensive services and commitment to customer success deliver high returns on investment for its customers. More than 1,400 organizations worldwide use RightNow solutions including British Airways, British Telecom, Cisco Systems, Continental Tire North America, John Deere, Nikon and the Social Security Administration. Founded in 1997, RightNow is headquartered in Bozeman, Montana, with additional offices in North America, Europe and Asia. For further information, please visit www.rightnow.com.

RightNow is a registered trademark of RightNow Technologies, Inc. NASDAQ is a registered trademark of the NASDAQ Stock Market.

-30-

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management’s beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing,” similar expressions, and variations or negatives of these words and include, but are not limited to, statements regarding projected results of operations and management’s future strategic plans. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement.

The risks and uncertainties referred to above include, but are not limited to, risks associated with our business model; our ability to develop or acquire, and gain market acceptance for new products, including our new sales and marketing and voice automation products, in a cost-effective and timely manner; the gain or loss of key customers; competitive pressures; our ability to expand operations; fluctuations in our operating results due to changes in our mix of revenues, and our rate of growth; interruptions or delays in our hosting operations, breaches of our security measures; our ability to protect our intellectual property from infringement, and to avoid infringing the intellectual property rights of third parties; and our ability to expand, retain and motivate our employees and manage our growth. Further information on potential factors that could affect our financial results is included in our Annual Report on Form 10-K, quarterly reports on Form 10-Q, and other filings with the Securities and Exchange Commission. The forward-looking statements in this release speak only as of the date they are made. We undertake no obligation to revise or update publicly any forward-looking statement for any reason.

FRNOW

RightNow Technologies, Inc.

Consolidated Balance Sheets

(In thousands) (Unaudited)

	Sep 30, 2005			Dec 31, 2004
Assets
Cash and cash equivalents	$	39,594		$	18,944
Short-term investments	20,883			31,188
Accounts receivable	21,968			16,939
Term receivables, current	14,105			10,090
Allowance for doubtful accounts	(1,960		)	(1,581		)
Net receivables	34,113			25,448
Prepaid expenses	1,771			1,255
Total current assets	96,361			76,835

Property and equipment, net	5,597			4,393
Term receivables, non-current	10,801			5,756
Intangible assets, net	1,631			1,113
Other	261			212

Total Assets	$	114,651		$	88,309

Liabilities and Stockholders’ Equity
Accounts payable	$	2,018		$	1,720
Commissions and bonuses payable	3,344			2,648
Other accrued liabilities	5,617			3,715
Current portion of long-term debt	29			—
Current portion of deferred revenue	45,694			36,020
Total current liabilities	56,702			44,103

Long-term debt, net of current portion	125			—
Deferred revenue, net of current portion	18,058			13,105

Stockholders’ equity:
Common stock	31			29
Warrants	107			291
Additional paid-in capital	76,339			72,367
Accumulated other comprehensive income (loss)	(433		)	(605		)
Accumulated deficit	(36,278		)	(40,981		)
Total stockholders’ equity	39,766			31,101

Total Liabilities and Stockholders’ Equity	$	114,651		$	88,309

RightNow Technologies, Inc.

Consolidated Operating Statements

(In thousands, except per share amounts) (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2005			2004			2005			2004
Revenue:
Software, hosting and support	$	18,005		$	12,976		$	48,743		$	35,405
Professional services	5,149			3,450			13,831			8,640
Total revenue	23,154			16,426			62,574			44,045

Cost of revenue:
Software, hosting and support	2,253			1,729			6,593			4,944
Professional services	3,026			1,979			8,601			4,862
Total cost of revenue	5,279			3,708			15,194			9,806

Gross profit	17,875			12,718			47,380			34,239

Operating expenses:
Sales and marketing	11,248			8,055			31,262			22,940
Research and development	2,937			2,028			7,524			5,640
General and administrative	1,627			1,164			4,623			3,333
Total operating expenses	15,812			11,247			43,409			31,913

Income from operations	2,063			1,471			3,971			2,326

Interest and other income (expense), net	440			30			1,063			(80		)

Income before income taxes	2,503			1,501			5,034			2,246
Provision for income taxes	(160		)	(61		)	(331		)	(92		)
Net income	$	2,343		$	1,440		$	4,703		$	2,154

Net income per share:
Basic	$	0.08		$	0.06		$	0.16		$	0.12
Diluted	$	0.07		$	0.05		$	0.14		$	0.08

Shares used in the computation:
Basic	30,802			23,734			30,287			17,963
Diluted	33,667			30,671			33,541			27,519

RightNow Technologies, Inc.

Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2005			2004			2005			2004
Operating activities:
Net income	$	2,343		$	1,440		$	4,703		$	2,154
Non-cash adjustments:
Depreciation and amortization	892			746			2,462			2,081
Provision for losses on accounts receivable	216			349			260			551
Deferred income taxes	94			—			218			—
Changes in operating accounts:
Receivables	(6,072		)	(5,366		)	(14,340		)	(11,094		)
Prepaid expenses	(609		)	(344		)	(586		)	(1,141		)
Accounts payable	(373		)	217			405			367
Commissions and bonuses payable	807			102			732			598
Other accrued liabilities	1,444			315			2,023			1,183
Deferred revenue	6,523			3,694			15,283			9,217
Other	(17		)	(90		)	(109		)	(498		)
Cash provided by operating activities	5,248			1,063			11,051			3,418

Investing activities:
Net change in short-term investments	3,298			(25,943		)	10,303			(25,943		)
Acquisition of property and equipment	(1,124		)	(1,004		)	(3,272		)	(2,623		)
Acquisition of intangible assets	(23		)	(95		)	(1,035		)	(501		)
Other	8			—			8			1
Cash provided (used) by investing activities	2,159			(27,042		)	6,004			(29,066		)

Financing activities:
Proceeds from long-term debt	162			—			162			1,675
Proceeds from issuance of common stock:
Initial public offering, less offering costs	—			41,462			—			40,687
Employee stock options and stock purchase plan	1,767			105			3,572			306
Repurchase of common stock	—			—			—			(2		)
Payments on long-term debt	(8		)	(2,713		)	(8		)	(3,573		)
Cash provided by financing activities	1,921			38,854			3,726			39,093

Effect of foreign exchange rates on cash and cash equivalents	(26		)	19			(131		)	1

Increase (decrease) in cash and cash equivalents	9,302			12,894			20,650			13,446

Cash and cash equivalents at beginning of period	30,292			8,912			18,944			8,360
Cash and cash equivalents at end of period	$	39,594		$	21,806		$	39,594		$	21,806

EX-99.2 3 a05-18826_1ex99d2.htm EX-99.2

Exhibit 99.2

Consolidated Balance Sheets

Unaudited

Last updated October 24, 2005


	Amounts in thousands
	At December 31,				Mar 31,		Jun 30,		Sep 30,		Dec 31,		Mar 31,		Jun 30,		Sep 30,		Dec 31,		Mar 31,		Jun 30,		Sep 30,		Dec 31,		Mar 31,		Jun 30,		Sep 30,
	2000		2001		2002		2002		2002		2002		2003		2003		2003		2003		2004		2004		2004		2004		2005		2005		2005
Assets
Current assets:
Cash and cash equivalents	17,128		6,258		4,334		6,128		6,924		8,038		8,216		8,116		8,294		8,360		8,352		8,912		21,806		18,944		33,155		30,292		39,594
Short-term investments	—		—		—		—		—		—		—		—		—		—		—		—		25,943		31,188		19,698		24,181		20,883
Accounts receivable	5,649		3,711		3,996		4,745		6,102		6,637		7,084		7,652		6,342		10,415		12,003		14,034		17,968		16,939		13,552		15,799		21,968
Term receivables	2,839		3,600		3,000		3,033		2,784		3,085		4,498		5,881		6,521		4,926		5,080		5,849		8,232		10,090		13,275		14,733		14,105
Less allowance for doubtful accounts	(941	)	(728	)	(660	)	(641	)	(593	)	(519	)	(616	)	(521	)	(768	)	(902	)	(1,221	)	(1,274	)	(2,626	)	(1,581	)	(1,627	)	(1,608	)	(1,960	)
Prepaid expenses	526		510		437		475		646		466		853		711		1,021		509		1,017		1,778		1,265		1,255		1,272		1,196		1,771
Total current assets	25,201		13,351		11,107		13,740		15,863		17,707		20,035		21,839		21,410		23,308		25,231		29,299		72,588		76,835		79,325		84,593		96,361

Property and equipment, net	3,044		3,931		3,639		3,301		3,474		3,319		3,031		2,877		2,880		2,942		3,234		3,553		4,001		4,393		4,842		5,375		5,597
Term receivables, noncurrent	—		—		325		545		752		924		1,197		1,704		1,919		2,278		2,415		3,673		3,777		5,756		8,256		10,234		10,801
Intangible and other assets, net	496		1,343		1,361		1,264		1,157		1,152		990		911		938		858		1,145		1,068		1,157		1,325		1,232		2,028		1,892
Total assets	28,741		18,625		16,432		18,850		21,246		23,102		25,253		27,331		27,147		29,386		32,025		37,593		81,523		88,309		93,655		102,230		114,651

Liabilities, Preferred Stock and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable and accrued liabilities	2,819		2,335		1,563		1,574		1,878		2,039		2,229		2,591		3,234		3,179		4,197		4,293		5,452		5,435		6,397		6,600		7,635
Commissions and bonuses payable	1,025		531		509		685		731		1,076		925		974		1,197		1,636		1,469		2,133		2,248		2,648		1,971		2,550		3,344
Current portion of long-term debt	7		2,042		1,860		2,935		3,189		3,282		3,374		3,078		1,488		1,390		1,324		1,349		15		—		—		31		29
Deferred revenue	12,317		14,843		14,396		15,485		17,115		17,392		19,428		21,510		23,349		26,127		25,368		30,780		32,796		36,020		37,899		40,669		45,694
Total current liabilities	16,168		19,751		18,328		20,679		22,913		23,789		25,956		28,153		29,268		32,332		32,358		38,555		40,511		44,103		46,267		49,850		56,702

Deferred revenue, noncurrent	4,843		4,031		3,975		4,515		4,855		7,291		8,375		9,061		8,811		9,426		11,361		9,997		11,695		13,105		14,911		16,699		18,058
Long-term debt	—		1,185		1,131		1,006		1,127		940		720		753		626		484		1,046		1,377		—		—		—		131		125

Preferred stock	31,075		32,340		32,340		32,340		32,340		32,373		32,388		32,391		32,394		32,398		32,442		32,446		—		—		—		—		—

Stockholders’ equity (deficit):
Common stock and warrants	21		21		14		14		14		14		14		14		14		15		15		15		320		320		233		137		138
Additional paid-in capital	(1,109	)	(1,051	)	(1,042	)	(966	)	(958	)	(986	)	(984	)	(987	)	(922	)	(912	)	(807	)	(721	)	71,663		72,367		73,042		74,479		76,339
Other comprehensive income (loss)	(38	)	(91	)	(111	)	(49	)	(44	)	(9	)	(25	)	1		21		73		(40	)	(360	)	(390	)	(605	)	(618	)	(445	)	(433	)
Accumulated deficit	(22,219	)	(37,561	)	(38,203	)	(38,689	)	(39,001	)	(40,310	)	(41,191	)	(42,055	)	(43,065	)	(44,430	)	(44,350	)	(43,716	)	(42,276	)	(40,981	)	(40,180	)	(38,621	)	(36,278	)
Total stockholders’ equity (deficit)	(23,345	)	(38,682	)	(39,342	)	(39,690	)	(39,989	)	(41,291	)	(42,186	)	(43,027	)	(43,952	)	(45,254	)	(45,182	)	(44,782	)	29,317		31,101		32,477		35,550		39,766
Total liabilities, preferred stock and stockholders’ equity (deficit)	28,741		18,625		16,432		18,850		21,246		23,102		25,253		27,331		27,147		29,386		32,025		37,593		81,523		88,309		93,655		102,230		114,651

RightNow provides this information as of the “last updated” date above and makes no commitment to subsequently update the information.

You are encouraged to read RightNow’s most recent reports on Form 10-K and Form 10-Q for a full explanation of our financial data and results.

Consolidated Statements of Operations

Unaudited

Last updated October 24, 2005

	Amounts in thousands, except per share data
	Fiscal Year						2002															2003
	2000			2001			Q1			Q2			Q3			Q4			FY			Q1			Q2			Q3			Q4			FY
Revenue:
Software, hosting and support	10,549			18,998			5,452			5,743			6,237			5,906			23,338			6,276			6,940			7,457			8,627			29,300
Professional services	758			2,009			615			712			901			1,375			3,603			1,531			1,304			1,763			1,981			6,579
Total revenue	11,307			21,007			6,067			6,455			7,138			7,281			26,941			7,807			8,244			9,220			10,608			35,879

Cost of revenue:
Software, hosting and support	3,306			4,636			990			1,039			1,090			1,160			4,279			1,225			1,337			1,342			1,359			5,263
Professional services	485			1,335			432			473			664			587			2,156			736			765			967			1,272			3,740
Total cost of revenue	3,791			5,971			1,422			1,512			1,754			1,747			6,435			1,961			2,102			2,309			2,631			9,003

Gross profit	7,516			15,036			4,645			4,943			5,384			5,534			20,506			5,846			6,142			6,911			7,977			26,876

Operating expenses:
Sales and marketing	20,756			22,050			3,497			3,758			3,900			4,784			15,939			4,402			4,696			5,389			6,322			20,809
Research and development	3,639			4,584			938			949			1,030			1,200			4,117			1,439			1,480			1,489			1,507			5,915
General and administrative	3,375			3,973			773			609			686			774			2,842			766			795			978			979			3,518
Total operating expenses	27,770			30,607			5,208			5,316			5,616			6,758			22,898			6,607			6,971			7,856			8,808			30,242

Operating income (loss)	(20,254		)	(15,571		)	(563		)	(373		)	(232		)	(1,224		)	(2,392		)	(761		)	(829		)	(945		)	(831		)	(3,366		)
Interest and other income (expense), net	607			229			(81		)	(112		)	(79		)	(85		)	(357		)	(117		)	(35		)	(65		)	2			(215		)

Income (loss) before income taxes	(19,647		)	(15,342		)	(644		)	(485		)	(311		)	(1,309		)	(2,749		)	(878		)	(864		)	(1,010		)	(829		)	(3,581		)
Provision for income taxes	—			—			—			—			—			—			—			(3		)	—			—			(536		)	(539		)
Net income (loss)	(19,647		)	(15,342		)	(644		)	(485		)	(311		)	(1,309		)	(2,749		)	(881		)	(864		)	(1,010		)	(1,365		)	(4,120		)

Net income (loss) per share:
Basic	$	(1.42	)	$	(1.10	)	$	(0.05	)	$	(0.03	)	$	(0.02	)	$	(0.09	)	$	(0.19	)	$	(0.06	)	$	(0.06	)	$	(0.07	)	$	(0.09	)	$	(0.28	)
Diluted	$	(1.42	)	$	(1.10	)	$	(0.05	)	$	(0.03	)	$	(0.02	)	$	(0.09	)	$	(0.19	)	$	(0.06	)	$	(0.06	)	$	(0.07	)	$	(0.09	)	$	(0.28	)

Shares used in the computation:
Basic	13,810			14,006			14,047			14,155			14,367			14,370			14,284			14,394			14,399			14,448			14,704			14,560
Diluted	13,810			14,006			14,047			14,155			14,367			14,370			14,284			14,394			14,399			14,448			14,704			14,560

	Amounts in thousands, except per share data
	2004															2005
	Q1			Q2			Q3			Q4			FY			Q1			Q2			Q3			YTD
Revenue:
Software, hosting and support	10,720			11,709			12,976			14,359			49,764			13,874			16,864			18,005			48,743
Professional services	2,137			3,053			3,450			3,360			12,000			4,468			4,214			5,149			13,831
Total revenue	12,857			14,762			16,426			17,719			61,764			18,342			21,078			23,154			62,574

Cost of revenue:
Software, hosting and support	1,579			1,636			1,729			1,797			6,741			2,064			2,276			2,253			6,593
Professional services	1,310			1,573			1,979			2,344			7,206			2,696			2,879			3,026			8,601
Total cost of revenue	2,889			3,209			3,708			4,141			13,947			4,760			5,155			5,279			15,194

Gross profit	9,968			11,553			12,718			13,578			47,817			13,582			15,923			17,875			47,380

Operating expenses:
Sales and marketing	6,848			8,037			8,055			9,046			31,986			9,457			10,557			11,248			31,262
Research and development	1,805			1,807			2,028			2,167			7,807			2,161			2,426			2,937			7,524
General and administrative	1,153			1,016			1,164			1,288			4,621			1,410			1,586			1,627			4,623
Total operating expenses	9,806			10,860			11,247			12,501			44,414			13,028			14,569			15,812			43,409

Operating income (loss)	162			693			1,471			1,077			3,403			554			1,354			2,063			3,971
Interest and other income (expense), net	(64		)	(46		)	30			226			146			292			331			440			1,063

Income (loss) before income taxes	98			647			1,501			1,303			3,549			846			1,685			2,503			5,034
Provision for income taxes	(18		)	(13		)	(61		)	(8		)	(100		)	(45		)	(126		)	(160		)	(331		)
Net income (loss)	80			634			1,440			1,295			3,449			801			1,559			2,343			4,703

Net income (loss) per share:
Basic	$	0.01		$	0.04		$	0.06		$	0.04		$	0.17		$	0.03		$	0.05		$	0.08		$	0.16
Diluted	$	0.00		$	0.02		$	0.05		$	0.04		$	0.12		$	0.02		$	0.05		$	0.07		$	0.14

Shares used in the computation:
Basic	14,792			15,185			23,734			29,005			20,738			29,816			30,232			30,802			30,287
Diluted	25,143			26,187			30,671			33,665			29,177			33,559			33,367			33,667			33,541

RightNow provides this information as of the “last updated” date above and makes no commitment to subsequently update the information.

You are encouraged to read RightNow’s most recent reports on Form 10-K and Form 10-Q for a full explanation of our financial data and results.

Supplemental Data Sheet

Unaudited

Last updated October 24, 2005

		Fiscal Year				2002										2003
		2000		2001		Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY

Revenue	Term	6,504		15,757		5,051		4,904		4,868		4,987		19,810		5,336		5,730		6,192		6,730		23,988
Mix	Perpetual	4,045		3,241		401		839		1,369		919		3,528		940		1,210		1,265		1,897		5,312
(in thousands)	Professional services	758		2,009		615		712		901		1,375		3,603		1,531		1,304		1,763		1,981		6,579
	Total	11,307		21,007		6,067		6,455		7,138		7,281		26,941		7,807		8,244		9,220		10,608		35,879

Revenue	Term	57	%	75	%	83	%	76	%	68	%	68	%	74	%	68	%	69	%	67	%	63	%	67	%
Mix	Perpetual	36	%	15	%	7	%	13	%	19	%	13	%	13	%	12	%	15	%	14	%	18	%	15	%
(% of total)	Professional services	7	%	10	%	10	%	11	%	13	%	19	%	13	%	20	%	16	%	19	%	19	%	18	%

Revenue by	Americas	11,026		16,522		4,916		5,486		6,213		5,355		21,970		6,050		5,731		5,622		7,198		24,601
Geography	Europe	281		2,311		1,031		775		785		1,456		4,047		1,587		1,651		2,692		2,413		8,343
(in thousands)	Asia Pacific	—		2,174		120		194		140		470		924		170		862		906		997		2,935

Revenue by	Americas	98	%	79	%	81	%	85	%	87	%	74	%	82	%	78	%	70	%	61	%	68	%	69	%
Geography	Europe	2	%	11	%	17	%	12	%	11	%	20	%	15	%	20	%	20	%	29	%	23	%	23	%
(% of total)	Asia Pacific	0	%	10	%	2	%	3	%	2	%	6	%	3	%	2	%	10	%	10	%	9	%	8	%

Deferred	Current	12,317		14,843		14,396		15,485		17,115		17,392				19,428		21,510		23,349		26,127
Revenue	Non-current	4,843		4,031		3,975		4,515		4,855		7,291				8,375		9,061		8,811		9,426
(in thousands)	Total	17,160		18,874		18,371		20,000		21,970		24,683				27,803		30,571		32,160		35,553

Customers	New	593		361		65		46		51		65		227		38		56		57		60		211
	Total active (>)	1,000		1,100		1,000		1,000		1,000		900				900		900		900		1,000
	Percent hosted	62	%	78	%	76	%	80	%	82	%	82	%			83	%	83	%	85	%	85	%
	Interactions (in millions)	n/a		n/a		26		35		42		43		146		53		56		63		77		249

Employees	Worldwide	346		222		214		208		219		234				255		258		278		306

		2004										2005
		Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		YTD

Revenue	Term	8,491		8,384		9,553		9,793		36,221		10,624		10,791		11,695		33,110
Mix	Perpetual	2,229		3,325		3,423		4,566		13,543		3,250		6,073		6,310		15,633
(in thousands)	Professional services	2,137		3,053		3,450		3,360		12,000		4,468		4,214		5,149		13,831
	Total	12,857		14,762		16,426		17,719		61,764		18,342		21,078		23,154		62,574

Revenue	Term	66	%	56	%	58	%	55	%	59	%	58	%	51	%	51	%	53	%
Mix	Perpetual	17	%	23	%	21	%	26	%	22	%	18	%	29	%	27	%	25	%
(% of total)	Professional services	17	%	21	%	21	%	19	%	19	%	24	%	20	%	22	%	22	%

Revenue by	Americas	9,188		10,955		12,421		12,635		45,199		13,757		16,652		17,291		47,700
Geography	Europe	2,443		3,553		3,188		3,608		12,792		2,751		3,372		3,752		9,875
(in thousands)	Asia Pacific	1,226		254		817		1,476		3,773		1,834		1,054		2,111		4,999

Revenue by	Americas	71	%	74	%	76	%	72	%	73	%	75	%	79	%	75	%	76	%
Geography	Europe	19	%	24	%	19	%	20	%	21	%	15	%	16	%	16	%	16	%
(% of total)	Asia Pacific	10	%	2	%	5	%	8	%	6	%	10	%	5	%	9	%	8	%

Deferred	Current	25,368		30,780		32,796		36,020				37,899		40,669		45,694
Revenue	Non-current	11,361		9,997		11,695		13,105				14,911		16,699		18,058
(in thousands)	Total	36,729		40,777		44,491		49,125				52,810		57,368		63,752

Customers	New	69		74		88		80		311		60		80		92		232
	Total active (>)	1,000		1,100		1,100		1,200				1,200		1,300		1,400
	Percent hosted	85	%	85	%	86	%	87	%			86	%	86	%	87	%
	Interactions (in millions)	102		110		140		150		502		166		176		188		530

Employees	Worldwide	322		354		387		403				438		490		494

RightNow provides this information as of the “last updated” date above and makes no commitment to subsequently update the information.

You are encouraged to read RightNow’s most recent reports on Form 10-K and Form 10-Q for a full explanation of our financial data and results.

Consolidated Statements of Cash Flow

Unaudited

Last updated October 24, 2005

	Amounts in thousands
	Fiscal Years				2002										2003
	2000		2001		Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY
Operating activities
Net income (loss)	(19,647	)	(15,342	)	(644	)	(485	)	(311	)	(1,309	)	(2,749	)	(881	)	(864	)	(1,010	)	(1,365	)	(4,120	)
Noncash adjustments:
Depreciation and amortization	532		1,486		482		486		507		576		2,051		619		626		631		598		2,474
Provision for losses on accounts receivable	1,715		2,032		100		158		—		1		259		178		153		180		(34	)	477
Deferred taxes	—		—		—		—		—		—		—		—		—		—		—		—
Changes in operating accounts:
Receivables	(6,846	)	(1,295	)	(187	)	(1,117	)	(1,343	)	(989	)	(3,636	)	(2,216	)	(2,583	)	526		(2,405	)	(6,678	)
Prepaid expenses	(459	)	(338	)	—		(4	)	(187	)	96		(95	)	(244	)	169		(105	)	24		(156	)
Accounts payable and accrued liabilities	2,071		(435	)	(772	)	2		288		104		(378	)	192		333		629		(114	)	1,040
Commissions and bonusses payable	789		(510	)	(22	)	168		43		336		525		(152	)	34		224		414		520
Deferred revenue	12,991		2,367		(497	)	1,580		1,962		2,678		5,723		3,121		2,701		1,568		3,265		10,655
Other	114		(117	)	25		55		106		57		243		(39	)	(74	)	(205	)	425		107
Cash provided (used) by operating activities	(8,740	)	(12,152	)	(1,515	)	843		1,065		1,550		1,943		578		495		2,438		808		4,319

Investing activities
Acquistion of property and equipment	(3,031	)	(2,265	)	(140	)	(85	)	(620	)	(339	)	(1,184	)	(277	)	(330	)	(486	)	(491	)	(1,584	)
Acquistion of intangilbe assets	(236	)	(739	)	—		—		—		—		—		—		—		(150	)	—		(150	)
Change in short-term investments, net	—		—		—		—		—		—		—		—		—		—		—		—
Other	—		—		—		2		—		—		2		16		—		2		—		18
Cash used for investing activities	(3,267	)	(3,004	)	(140	)	(83	)	(620	)	(339	)	(1,182	)	(261	)	(330	)	(634	)	(491	)	(1,716	)

Financing activities
Net proceeds from (payments on) long-term debt	(8	)	3,219		(270	)	930		353		(117	)	896		(150	)	(285	)	(1,739	)	(259	)	(2,433	)
Proceeds from issuance of stock:
Preferred stock	14,955		1,026		—		—		—		—		—		—		—		—		—		—
Common stock issued under employee benefit plans	93		46		1		74		9		6		90		5		—		70		13		88
Initial public offering, net of offering costs	—		—		—		—		—		—		—		—		—		—		—		—
Other	(94	)	—		—		—		—		—		—		—		—		—		—		—
Cash provided (used) by financing activities	14,946		4,291		(269	)	1,004		362		(111	)	986		(145	)	(285	)	(1,669	)	(246	)	(2,345	)

Effect of foreign exchange rates	6		(5	)	—		30		(11	)	14		33		5		20		44		(5	)	64

Net change in cash and cash equivalents	2,945		(10,870	)	(1,924	)	1,794		796		1,114		1,780		177		(100	)	179		66		322

Cash and cash equivalents at beginning of period	14,183		17,128		6,258		4,334		6,128		6,924		6,258		8,038		8,215		8,115		8,294		8,038
Cash and cash equivalents at end of period	17,128		6,258		4,334		6,128		6,924		8,038		8,038		8,215		8,115		8,294		8,360		8,360

	Amounts in thousands
	2004										2005
	Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		YTD
Operating activities
Net income (loss)	80		634		1,440		1,295		3,449		801		1,559		2,343		4,703
Noncash adjustments:
Depreciation and amortization	624		711		746		709		2,790		742		828		892		2,462
Provision for losses on accounts receivable	85		117		349		(62	)	489		52		(8	)	216		260
Deferred taxes	—		—		—		—		—		—		124		94		218
Changes in operating accounts:
Receivables	(1,550	)	(4,178	)	(5,366	)	(3,563	)	(14,657	)	(2,402	)	(5,866	)	(6,072	)	(14,340	)
Prepaid expenses	(261	)	(536	)	(344	)	(23	)	(1,164	)	(44	)	67		(609	)	(586	)
Accounts payable and accrued liabilities	580		438		532		425		1,975		984		373		1,071		2,428
Commissions and bonusses payable	(175	)	671		102		390		988		(663	)	588		807		732
Deferred revenue	1,117		4,406		3,694		4,103		13,320		3,819		4,941		6,523		15,283
Other	(167	)	(241	)	(90	)	46		(452	)	(50	)	(42	)	(17	)	(109	)
Cash provided (used) by operating activities	333		2,022		1,063		3,320		6,738		3,239		2,564		5,248		11,051

Investing activities
Acquistion of property and equipment	(761	)	(858	)	(1,004	)	(957	)	(3,580	)	(1,078	)	(1,070	)	(1,124	)	(3,272	)
Acquistion of intangilbe assets	—		(406	)	(95	)	(190	)	(691	)	—		(1,012	)	(23	)	(1,035	)
Change in short-term investments, net	—		—		(25,943	)	(5,245	)	(31,188	)	11,488		(4,483	)	3,298		10,303
Other	—		1		—		2		3		—		—		8		8
Cash used for investing activities	(761	)	(1,263	)	(27,042	)	(6,390	)	(35,456	)	10,410		(6,565	)	2,159		6,004

Financing activities
Net proceeds from (payments on) long-term debt	474		341		(2,713	)	(15	)	(1,913	)	—		—		154		154
Proceeds from issuance of stock:																	—
Preferred stock	—		—		—		—		—		—		—		—		—
Common stock issued under employee benefit plans	111		90		105		870		1,176		588		1,217		1,767		3,572
Initial public offering, net of offering costs	(172	)	(603	)	41,462		(715	)	39,972		—		—		—		—
Other	(2	)	—		—		—		(2	)	—		—		—		—
Cash provided (used) by financing activities	411		(172	)	38,854		140		39,233		588		1,217		1,921		3,726

Effect of foreign exchange rates	9		(27	)	19		68		69		(26	)	(79	)	(26	)	(131	)

Net change in cash and cash equivalents	(8	)	560		12,894		(2,862	)	10,584		14,211		(2,863	)	9,302		20,650

Cash and cash equivalents at beginning of period	8,360		8,352		8,912		21,806		8,360		18,944		33,155		30,292		18,944
Cash and cash equivalents at end of period	8,352		8,912		21,806		18,944		18,944		33,155		30,292		39,594		39,594

RightNow provides this information as of the “last updated” date above and makes no commitment to subsequently update the information.

You are encouraged to read RightNow’s most recent reports on Form 10-K and Form 10-Q for a full explanation of our financial data and results.

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