EX-99.1 2 a07-11771_1ex99d1.htm EX-99.1

Exhibit 99.1

136 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

 

Kathleen O’Boyle

The Blueshirt Group

 

RightNow Technologies

415.217.7722

 

406.556.3428 Office

todd@blueshirtgroup.com

 

415.407.8308 Cell

stacie@blueshirtgroup.com

 

Kathleen.oboyle@rightnow.com

 

RIGHTNOW TECHNOLOGIES REPORTS FIRST QUARTER FINANCIAL
RESULTS AND RESCHEDULES EARNINGS CALL

FOR THURSDAY, APRIL 19, 2007

Company also announces resignation of Jay Rising

BOZEMAN, MONT. (April 19, 2007) RightNow Technologies (NASDAQ:RNOW), today announced results for the quarter ended March 31, 2007. First quarter revenue was $25.7 million.  The net loss in the first quarter of 2007 was $(6.0) million or $(0.18) per share, compared to a net loss of $(0.4) million, or $(0.01) per share, in the first quarter of 2006. First quarter 2007 non-GAAP net loss was $(4.7) million which excludes stock-based compensation charges of $1.3 million.  2007 first quarter results include a 38% increase in recurring revenue and an 88% decrease in perpetual revenue compared to the first quarter of 2006, reflecting the Company’s recent business model changes.

During the first quarter, RightNow announced the general availability of RightNow 8 and added more than 60 new customers. New, renewed and expanded customer relationships during the first quarter of 2007 included Air Canada, Centers for Medicare/Medicaid, Daimler Chrysler, Drugstore.com, IAC Search and Media, Kewill, Reuters, Rockwell Automation, Sprint Nextel, and State of Indiana.  The Company also served more than 352 million interactions for its customers.

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“The first quarter marked a good start to the year for RightNow as we executed through our business model transition,” stated Greg Gianforte, founder and CEO. “The launch of RightNow 8 has been very well received by customers, partners and industry analysts.”

Susan Carstensen, CFO, added, “We are reiterating 2007 revenue guidance reflecting the successful efforts of our sales force to focus on first year recurring revenue.  The shift in our business model contributed to a greater than expected decline in average contract length which results in lower cash guidance for the full year.  However, given our high customer satisfaction and our successful track record capturing better than 100% of available renewal dollars, we believe this shift will ultimately benefit our long term cash flow.”

The Company also announced the resignation of Jay Rising, President of Field Operations.  “Our sales leadership is in excellent hands with three senior, experienced software general managers running our North America, EMEA, and Asia Pacific regions,” said Mr. Gianforte.  “I believe this change will have minimal impact on our sales organization, our pipeline or our forecasts and we are well-positioned to achieve our growth targets.”

Guidance

·                  For the full year 2007, the Company reiterated its expectation for revenue in the range of $116 million to $120 million.

·                  The Company now expects a smaller net loss per share for the full year 2007 in the range of $(0.51) to $(0.59). Non-GAAP net loss per share, which excludes stock-based compensation, is expected to be in the range of $(0.31) to $(0.39).

·                  Cash flow from operations for the full year 2007 is expected to be in the range of $15 million to $25 million.

·                  For the second quarter of 2007, revenue is anticipated to be in the range of $26.3 million to $26.8 million. The second quarter net loss per share is expected to be in the range of $(0.18) to $(0.20). Non-GAAP net loss per share, which excludes stock-based compensation, is expected to be in the range of $(0.11) to $(0.13).

RightNow has rescheduled its previously announced conference call and will now host a call this afternoon, Thursday April 19, at 5:30 p.m. Eastern time to discuss these results.  To access the call, please dial (800) 811-0667, or outside the U.S. (913) 981-4901, at lease 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 on the company’s web site at www.shareholder.com/rnow/, under the Investor Webcasts menu, from 8:30 p.m. (ET) on April 19, 2007 until 11:59 p.m. Wednesday, May 2, 2007.  You may also access a replay of today’s call by dialing (719) 457-0820 or (888) 203-1112, with replay passcode 8594471.

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About RightNow Technologies, Inc.

RightNow (NASDAQ: RNOW) delivers the high-impact technology solutions and services organizations need to cost-efficiently deliver a consistently superior customer experience across their frontline service, sales and marketing touch-points. More than 1,800 corporations and government agencies worldwide depend on RightNow to achieve their strategic objectives and better meet the needs of those they serve. RightNow is headquartered in Bozeman, Montana. For more 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, LLC.

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, including recent changes we made to our model; our ability to develop or acquire, and gain market acceptance for new products in a cost-effective and timely manner; the market success of our recently released RightNow 8 product; the gain or loss of key customers; competitive pressures; our ability to expand operations; our ability to successfully retain customers of Salesnet, Inc. and to integrate Salesnet’s products and processes following our recent acquisition of that company; fluctuations in our earnings as a result of the impact of stock-based compensation expense; 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 on 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 of Form 10-Q, and in 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

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RightNow Technologies, Inc.

Consolidated Balance Sheets

(In thousands) (Unaudited)

 

 

March 31,

 

Dec 31,

 

 

 

2007

 

2006

 

Assets

 

 

 

 

 

Cash and cash equivalents

 

$

44,899

 

$

39,208

 

Short-term investments

 

37,578

 

39,127

 

Accounts receivable

 

25,050

 

32,021

 

Term receivables, current

 

20,555

 

23,806

 

Allowance for doubtful accounts

 

(2,273

)

(2,621

)

Net receivables

 

43,332

 

53,206

 

Prepaid & other current assets

 

3,676

 

2,498

 

Total current assets

 

129,485

 

134,039

 

 

 

 

 

 

 

Property and equipment, net

 

10,715

 

10,073

 

Term receivables, non-current

 

19,349

 

24,805

 

Intangible assets, net

 

8,538

 

8,836

 

Other

 

842

 

489

 

Total Assets

 

$

168,929

 

$

178,242

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Accounts payable

 

$

3,286

 

$

4,417

 

Commissions and bonuses payable

 

2,902

 

4,069

 

Other accrued liabilities

 

10,532

 

7,588

 

Current portion of long-term debt

 

32

 

31

 

Current portion of deferred revenue

 

67,444

 

67,560

 

Total current liabilities

 

84,196

 

83,665

 

 

 

 

 

 

 

Long-term debt, less current portion

 

77

 

85

 

Deferred revenue, net of current portion

 

41,241

 

47,018

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Common stock

 

33

 

33

 

Additional paid-in capital

 

88,064

 

86,069

 

Accumulated other comprehensive loss

 

(384

)

(332

)

Accumulated deficit

 

(44,298

)

(38,296

)

Total stockholders’ equity

 

43,415

 

47,474

 

Total Liabilities Stockholders’ Equity

 

$

168,929

 

$

178,242

 

 

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RightNow Technologies, Inc.

Consolidated Operating Statements

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

 

 

Three Months Ended
March 31,

 

 

 

2007

 

2006

 

Revenue:

 

 

 

 

 

Software, hosting and support

 

$

19,819

 

$

19,310

 

Professional services

 

5,883

 

5,321

 

Total revenue

 

25,702

 

24,631

 

 

 

 

 

 

 

Cost of revenue:

 

 

 

 

 

Software, hosting and support

 

4,394

 

2,771

 

Professional services

 

5,171

 

4,104

 

Total cost of revenue

 

9,565

 

6,875

 

 

 

 

 

 

 

Gross profit

 

16,137

 

17,756

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Sales and marketing

 

15,727

 

13,726

 

Research and development

 

4,296

 

3,130

 

General and administrative

 

2,860

 

2,056

 

Total operating expenses

 

22,883

 

18,912

 

 

 

 

 

 

 

Loss from operations

 

(6,746

)

(1,156

)

 

 

 

 

 

 

Interest and other income, net

 

828

 

672

 

 

 

 

 

 

 

Loss before income taxes

 

(5,918

)

(484

)

(Provision for) benefit from income taxes

 

(84

)

44

 

Net loss

 

$

(6,002

)

$

(440

)

 

 

 

 

 

 

Net loss per share:

 

 

 

 

 

Basic

 

$

(0.18

)

$

(0.01

)

Diluted

 

$

(0.18

)

$

(0.01

)

 

 

 

 

 

 

Shares used in the computation:

 

 

 

 

 

Basic

 

32,858

 

31,943

 

Diluted

 

32,858

 

31,943

 

 

 

 

 

 

 

Stock-based compensation expense included in:

 

 

 

 

 

Cost of software, hosting and support

 

$

58

 

$

38

 

Cost of professional services

 

125

 

97

 

Sales and marketing

 

658

 

366

 

Product development

 

226

 

159

 

General and administrative

 

235

 

123

 

Total stock-based compensation

 

$

1,302

 

$

783

 

 

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RightNow Technologies, Inc.

Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

 

 

Three Months Ended
March 31,

 

 

 

2007

 

2006

 

Operating activities:

 

 

 

 

 

Net loss

 

$

(6,002

)

$

(440

)

Non-cash adjustments:

 

 

 

 

 

Depreciation and amortization

 

1,675

 

1,105

 

  Recoveries for uncollectible accounts receivable

 

(69

)

(248

)

Stock-based compensation

 

1,302

 

783

 

Changes in operating accounts:

 

 

 

 

 

Receivables

 

15,427

 

(9,798

)

Prepaid and other current assets

 

(1,471

)

(167

)

Accounts payable

 

(1,133

)

688

 

Commissions and bonuses payable

 

(1,171

)

787

 

Other accrued liabilities

 

2,881

 

503

 

Deferred revenue

 

(6,056

)

12,976

 

Other

 

(23

)

(137

)

Cash provided by operating activities

 

5,360

 

6,052

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

Net change in short-term investments

 

1,549

 

(3,749

)

Acquisition of property and equipment

 

(1,987

)

(1,140

)

Other

 

(29

)

(10

)

Cash used in investing activities

 

(467

)

(4,899

)

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

Proceeds from issuance of common stock under employee benefit plans

 

643

 

432

 

Excess tax benefits of stock options exercised

 

49

 

 

Payments on long-term debt

 

(7

)

(7

)

Cash provided by financing activities

 

685

 

425

 

 

 

 

 

 

 

Effect of foreign exchange rates on cash and cash equivalents

 

113

 

(8

)

 

 

 

 

 

 

Increase in cash and cash equivalents

 

5,691

 

1,570

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

39,208

 

40,874

 

Cash and cash equivalents at end of period

 

$

44,899

 

$

42,444

 

 

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RightNow Technologies, Inc.

Reconciliation of Non-GAAP Measurements

 (Amounts in thousands, except per share amounts) (Unaudited)

Diluted Earnings Per Share Reconciliation

 

Three Months Ended
March 31,

 

 

 

2007

 

2006

 

Net loss as reported

 

$

(6,002

)

$

(440

)

Add stock-based compensation (“SBC”)

 

1,302

 

783

 

Net income (loss) before SBC

 

(4,700

)

343

 

 

 

 

 

 

 

Net loss per share, as reported

 

$

(0.18

)

$

(0.01

)

Net income (loss) per share, before SBC

 

(0.14

)

0.01

 

 

 

 

 

 

 

Shares used in the calculation, as reported

 

32,858

 

31,943

 

Shares used in the calculation, before SBC

 

32,858

 

33,954

 

 

Forward-Looking Guidance Reconciliation

 

 

GAAP Guidance

 

 

 

Non-GAAP Guidance

 

 

 

From

 

To

 

Adjustment

 

From

 

To

 

Quarter ending June 30, 2007

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(6,000

)

$

(6,500

)

$

2,250

[a]

$

(3,750

)

$

(4,250

)

EPS

 

$

(0.18

)

$

(0.20

)

 

 

$

(0.11

)

$

(0.13

)

Shares

 

33,000

 

33,000

 

 

 

33,000

 

33,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ending December 31, 2007

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(17,000

)

$

(19,500

)

$

6,600

[a]

$

(10,400

)

$

(12,900

)

EPS

 

$

(0.51

)

$

(0.59

)

 

 

$

(0.31

)

$

(0.39

)

Shares

 

33,200

 

33,200

 

 

 

33,200

 

33,200

 

 


[a] Estimated stock-based compensation expense to be recorded for the periods indicated in accordance with Statement of Financial Accounting Standards No. 123R, Share-Based Payments, (“SFAS 123R”) which is effective for periods beginning January 1, 2006.  Periods prior to 2006 do not include stock-based compensation expense.

About Non-GAAP Financial Measures

Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.  These non-GAAP financial measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the same captions and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies.

RightNow’s management believes that these non-GAAP financial measures provide meaningful supplemental information regarding RightNow’s operating results because they facilitate the comparison of results for future periods with results from past periods.  RightNow adopted SFAS 123R on January 1, 2006 using the modified prospective method.  Results of prior periods have not been restated to conform with the 2006 and subsequent years’ presentation.  We believe the calculation of diluted net income per share, calculated without stock-based compensation expense, provides a meaningful comparison to our diluted net income per share figures reported for 2005 and prior years.

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