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): February 10, 2015
Marketo, Inc.
(Exact Name of Registrant as Specified in its Charter)
Delaware |
|
001-35909 |
|
56-2558241 |
(State or Other Jurisdiction of Incorporation) |
|
(Commission File Number) |
|
(IRS Employer Identification No.) |
901 Mariners Island Blvd., Suite 200
San Mateo, California 94404
(Address of principal executive offices, Zip code)
(650) 376-2300
(Registrants telephone number, including area code)
Not applicable
(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 February 10, 2015, Marketo, Inc. (the Company) announced its results of operations for the fourth quarter ended December 31, 2014. A copy of the Companys press release announcing such results dated February 10, 2015 is attached hereto as Exhibit 99.1. This Current Report on Form 8-K and the attached exhibits are furnished to, but not filed with, the U.S. Securities and Exchange Commission (SEC) and shall not be deemed to be incorporated by reference into any of the Companys filings with the SEC under the Securities Act of 1933, as amended, or the Exchange Act of 1934, as amended.
ITEM 9.01 Financial Statements and Exhibits
(d) Exhibits
The following exhibits are furnished as part of this Current Report on Form 8-K.
Exhibit No. |
|
Exhibit Description |
99.1 |
|
Press release dated February 10, 2015. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: February 10, 2015
|
MARKETO, INC. | |
|
|
|
|
|
|
|
By: |
/s/ Frederick A. Ball |
|
Name: |
Frederick A. Ball |
|
Title: |
Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) |
Exhibit 99.1
Marketo Announces Fourth Quarter and Full Year 2014 Results
SAN MATEO, Calif. February 10, 2015 Marketo (NASDAQ: MKTO), the leading provider of engagement marketing software and solutions, today announced its fourth quarter and full year 2014 financial results.
Highlights:
· Annual 2014 revenue increased 56% year over year to $150.0 million
· Fourth quarter revenue grew 50% over fourth quarter 2013 to $42.3 million
· Deferred revenue increased 52% year over year to $62.9 million
· Subscription dollar retention rate rose to an average of 109%
· Customer count increased to 3,794
Our strong fourth quarter performance capped a year of impressive execution and growth. We were a prolific technology innovator in 2014 with the introduction of our Engagement Marketing Platform and three major new applications on that platform. And we renewed our thought leadership agenda for the industry as we ushered in the Era of Engagement Marketing, said Phil Fernandez, chairman and chief executive officer of Marketo. With the investments we made in 2014 in our global operations including a highly successful launch in Japan, our rapid extension into B2C markets, and the depth of our enterprise sales leadership team, we are well positioned to capitalize on the market opportunity in 2015 and most importantly, to continue to provide extraordinary value to our customers.
Results for the fourth quarter of 2014:
· Revenue: Revenue was $42.3 million, an increase of 50% over the fourth quarter of 2013.
· Deferred Revenue: Deferred revenue at December 31, 2014 was $62.9 million, up 18% from $53.2 million reported at September 30, 2014. This compares to $41.4 million at December 31, 2013.
· Adjusted Calculated Billings: Adjusted calculated billings were $50.0 million, an increase of 43% over $34.9 million in the same period of the prior year.
· Net Loss: GAAP net loss, excluding redeemable non-controlling interests, was $15.9 million, and net loss per common share, basic and diluted, was $(0.39). Non-GAAP net loss was $7.6 million, and non-GAAP net loss per common share, basic and diluted, was $(0.18). A detailed reconciliation table titled Reconciliation of GAAP Measures to Non-GAAP Measures is provided at the end of this release.
· Cash Flow from Operations: For the quarter ended December 31, 2014, cash used in operating activities was $3.2 million as compared to a use of $4.9 million in the same period of the prior year.
· Total Cash and Cash Equivalents: As of December 31, 2014, total cash and cash equivalents was $112.6 million.
Results for fiscal year 2014:
· Revenue: Revenue was $150.0 million, an increase of 56% over 2013.
· Net Loss: GAAP net loss, excluding redeemable non-controlling interests, was $54.3 million, and net loss per common share, basic and diluted, was $(1.35). Non-GAAP net loss was $27.1 million, and non-GAAP net loss per common share, basic and diluted, was $(0.67). A detailed reconciliation table titled Reconciliation of GAAP Measures to Non-GAAP Measures is provided at the end of this release.
· Cash Flow from Operations: Cash used in operating activities was $14.0 million as compared to a use of $12.4 million in 2013.
Outlook
As of February 10, 2015, Marketo is initiating revenue and EPS guidance for its first quarter and full year 2015.
For the first quarter of 2015, Marketo expects to report:
· Revenue in the range of $45 to $46 million
· GAAP net loss per share in the range of $(0.46) to $(0.48)
· Non-GAAP net loss per share in the range of $(0.20) to $(0.22)
For the full year 2015, Marketo expects to report:
· Revenue in the range of $204 to $206 million
· GAAP net loss per share in the range of $(2.01) to $(2.05)
· Non-GAAP net loss per share in the range of $(0.83) to $(0.87)
A reconciliation table titled Reconciliation of GAAP Net Loss to Non-GAAP Net Loss Per Share Targets is provided at the end of this release.
Conference Call Information
Marketo will host a conference call and live webcast to discuss the financial results at 2:00 p.m. Pacific Time, 5:00 p.m. Eastern Time, today, Tuesday, February 10, 2015. The conference call can be accessed by dialing (888) 329-8877 or +1(719) 325-2308 (outside the U.S. and Canada). A live webcast will be available at http://investors.marketo.com and via replay beginning approximately two hours after the completion of the call. An audio replay of the call will also be available by dialing (888) 203-1112 or +1(719) 457-0820 (outside the U.S. and Canada) and entering passcode 7895631#.
Use of Non-GAAP Financial Information
The company reports non-GAAP financial measures, including gross margins, operating margins, net loss, basic and diluted loss per share, and adjusted billings in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Marketo provides financial statements that are prepared in accordance with generally accepted accounting principles (GAAP). To help understand Marketos past financial performance and future expectations, Marketo has supplemented its financial results that it provides in accordance with GAAP with certain non-GAAP financial measures. The method Marketo uses to produce non-GAAP financial results is not computed according to GAAP and may differ from the methods used by other companies. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with the companys consolidated financial statements prepared in accordance with GAAP. Specifically, management is excluding the following items from its non-GAAP historical and estimated net loss and net loss per common share, basic and diluted:
· Stock-Based Compensation Expenses: The companys compensation strategy includes the use of stock-based compensation to attract and retain employees and executives. It is principally aimed at aligning their interests with those of our stockholders and at long-term employee retention, rather than to motivate or reward operational performance for any particular period. Thus, stock-based compensation expense varies for reasons that are generally unrelated to operational decisions and performance in any particular period.
· Amortization of Acquired Intangible Assets: The company views amortization of acquisition-related intangible assets, such as the amortization of the cost associated with an acquired companys research and development efforts, trade names, customer lists and customer relationships, as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangibles is a static expense, one that is not typically affected by operations during any particular period.
· Litigation Settlement: The company settled some litigation in the fourth quarter of 2013 and views this as a non-recurring expense.
· Integration Costs: The company views acquisition-related integration costs, such as legal and audit services associated with an acquired company, as items arising from pre-acquisition activities that are non-recurring in nature.
The company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.
Adjusted Calculated Billings is calculated as revenue plus the change in total deferred revenue as presented on the balance sheet adjusted for quarterly versus annual billing frequency and a change in invoicing policy made in the fourth quarter of 2013. Management believes adjusted calculated billings offers investors useful supplemental information regarding the performance of our business, and will help investors better understand the sales volumes and performance of our business.
Safe harbor statement under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements. These forward-looking statements include general statements about our opportunities for growth and specific statements about our expected GAAP and non-GAAP financial results for the first quarter and the full year of 2015, including revenue, net loss, EPS, stock-based compensation expenses and amortization of acquired intangible assets. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the companys results could differ materially from the results expressed or implied by the forward-looking statements we make.
The risks and uncertainties that could cause actual results to differ from the results predicted include, but are not limited to, risks associated with: possible fluctuations in the companys financial and operating results; the companys rate of growth and anticipated revenue run rate, including the companys ability to convert deferred revenue and unbilled deferred revenue into revenue and, as appropriate, cash flow, and the continued growth and ability to maintain deferred revenue and unbilled deferred revenue; errors, interruptions or delays in the companys service or the companys Web hosting; breaches of the companys security measures; the financial impact of any previous and future acquisitions; the nature of the companys business model; the companys ability to continue to release, and gain customer acceptance of, new and improved versions of the companys service; successful customer deployment and utilization of the companys existing and future services; changes in the companys sales cycle; competition; relationships with platform providers; various financial aspects of the companys subscription model; unexpected increases in attrition or decreases in new business; the emerging markets in which the company operates; unique aspects of entering or expanding in international markets; the companys ability to hire, retain and motivate employees and manage the companys growth; changes in the companys customer base; technological developments; regulatory developments; litigation related to intellectual property and other matters, and any related claims, negotiations and settlements; unanticipated changes in the companys effective tax rate; fluctuations in the number of shares we have outstanding and the price of such shares; foreign currency exchange rates; collection of receivables; interest rates; factors affecting our deferred tax assets and ability to value and utilize them; the risks and expenses associated with the companys real estate and office facilities space; and general developments in the economy, financial markets, and credit markets.
Further information about factors that could affect the companys financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings the company makes with the Securities and Exchange Commission from time to time.
Marketo assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
About Marketo:
Marketo (NASDAQ: MKTO) provides the leading marketing software and solutions designed to help marketers master the art and science of digital marketing. Through a unique combination of innovation and expertise, Marketo is focused solely on helping marketers keep pace in an ever-changing digital world. Spanning todays digital, social, mobile and offline channels, Marketos® Engagement Marketing Platform powers a set of breakthrough applications to help marketers tackle all aspects of digital marketing from the planning and orchestration of marketing activities to the delivery of personalized interactions that can be optimized in real-time. Marketos applications are known for their ease-of-use, and are complemented by the Marketing Nation®, a thriving network of more than 400 third-party solutions through our LaunchPoint ® ecosystem and over 50,000 marketers who share and learn from each other to grow their collective marketing expertise. The result for modern marketers is unprecedented agility and superior results. Headquartered in San Mateo, CA with offices in Europe, Australia and Japan, Marketo serves as a strategic marketing partner to more than 3,750 large enterprises and fast-growing small companies across a wide variety of industries. For more information, visit www.marketo.com.
Marketo, the Marketo logo, Marketing Nation and LaunchPoint are trademarks of Marketo, Inc. All other trademarks are the property of their respective owners.
IR Contact:
Anne Marie McCauley
Marketo
650-727-6845
amccauley@marketo.com
PR Contact:
Mike Moeller
Marketo
408.439.4169
Mmoeller@marketo.com
Source Marketo
###
MARKETO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
|
|
December 31, |
|
December 31, |
| ||
|
|
2014 |
|
2013 |
| ||
|
|
|
|
|
| ||
ASSETS |
|
|
|
|
| ||
Current assets: |
|
|
|
|
| ||
Cash and cash equivalents |
|
$ |
112,644 |
|
$ |
128,299 |
|
Accounts receivable, net |
|
37,867 |
|
26,946 |
| ||
Prepaid expenses and other current assets |
|
5,756 |
|
3,218 |
| ||
Total current assets |
|
156,267 |
|
158,463 |
| ||
Property and equipment, net |
|
16,832 |
|
13,856 |
| ||
Goodwill |
|
29,201 |
|
25,941 |
| ||
Intangible assets, net |
|
7,076 |
|
7,095 |
| ||
Other assets |
|
1,035 |
|
484 |
| ||
Total assets |
|
$ |
210,411 |
|
$ |
205,839 |
|
|
|
|
|
|
| ||
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS EQUITY |
|
| |||||
Current liabilities: |
|
|
|
|
| ||
Accounts payable |
|
$ |
3,901 |
|
$ |
3,527 |
|
Accrued expenses and other current liabilities |
|
20,691 |
|
23,055 |
| ||
Deferred revenue |
|
62,945 |
|
41,356 |
| ||
Current portion of credit facility |
|
2,719 |
|
2,187 |
| ||
Total current liabilities |
|
90,256 |
|
70,125 |
| ||
Credit facility, net of current portion |
|
2,653 |
|
5,372 |
| ||
Other long-term liabilities |
|
3,526 |
|
1,900 |
| ||
Total liabilities |
|
96,435 |
|
77,397 |
| ||
|
|
|
|
|
| ||
Redeemable non-controlling interests |
|
800 |
|
|
| ||
|
|
|
|
|
| ||
Stockholders equity: |
|
|
|
|
| ||
Common stock |
|
4 |
|
4 |
| ||
Additional paid-in capital |
|
297,420 |
|
257,801 |
| ||
Accumulated other comprehensive income (loss) |
|
(350 |
) |
198 |
| ||
Accumulated deficit |
|
(183,898 |
) |
(129,561 |
) | ||
Total stockholders equity |
|
113,176 |
|
128,442 |
| ||
Total liabilities, redeemable non-controlling interests and stockholders equity |
|
$ |
210,411 |
|
$ |
205,839 |
|
MARKETO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
|
|
Three Months |
|
For the Year |
| ||||||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Revenue: |
|
|
|
|
|
|
|
|
| ||||
Subscription and support |
|
$ |
37,003 |
|
$ |
25,153 |
|
$ |
131,060 |
|
$ |
85,095 |
|
Professional services and other |
|
5,342 |
|
3,018 |
|
18,894 |
|
10,823 |
| ||||
Total revenue |
|
42,345 |
|
28,171 |
|
149,954 |
|
95,918 |
| ||||
Cost of revenue (1): |
|
|
|
|
|
|
|
|
| ||||
Subscription and support |
|
8,104 |
|
6,295 |
|
28,742 |
|
24,681 |
| ||||
Professional services and other |
|
5,980 |
|
3,991 |
|
22,059 |
|
13,298 |
| ||||
Total cost of revenue |
|
14,084 |
|
10,286 |
|
50,801 |
|
37,979 |
| ||||
Gross profit: |
|
|
|
|
|
|
|
|
| ||||
Subscription and support |
|
28,899 |
|
18,858 |
|
102,318 |
|
60,414 |
| ||||
Professional services and other |
|
(638 |
) |
(973 |
) |
(3,165 |
) |
(2,475 |
) | ||||
Total gross profit |
|
28,261 |
|
17,885 |
|
99,153 |
|
57,939 |
| ||||
Operating expenses (1): |
|
|
|
|
|
|
|
|
| ||||
Research and development |
|
8,327 |
|
6,402 |
|
30,337 |
|
23,321 |
| ||||
Sales and marketing |
|
29,716 |
|
19,719 |
|
98,843 |
|
62,769 |
| ||||
General and administrative |
|
7,066 |
|
6,996 |
|
25,583 |
|
18,655 |
| ||||
Total operating expenses |
|
45,109 |
|
33,117 |
|
154,763 |
|
104,745 |
| ||||
Loss from operations |
|
(16,848 |
) |
(15,232 |
) |
(55,610 |
) |
(46,806 |
) | ||||
Other income (expense), net |
|
120 |
|
(281 |
) |
178 |
|
(526 |
) | ||||
Loss before provision for income taxes |
|
(16,728 |
) |
(15,513 |
) |
(55,432 |
) |
(47,332 |
) | ||||
Provision (benefit) for income taxes |
|
(573 |
) |
(18 |
) |
(477 |
) |
28 |
| ||||
Net loss |
|
(16,155 |
) |
(15,495 |
) |
(54,955 |
) |
(47,360 |
) | ||||
Net loss attributable to redeemable non-controlling interests |
|
242 |
|
|
|
618 |
|
|
| ||||
Net loss attributable to Marketo |
|
$ |
(15,913 |
) |
$ |
(15,495 |
) |
$ |
(54,337 |
) |
$ |
(47,360 |
) |
|
|
|
|
|
|
|
|
|
| ||||
Net loss per share of common stock, basic and diluted |
|
$ |
(0.39 |
) |
$ |
(0.41 |
) |
$ |
(1.35 |
) |
$ |
(1.92 |
) |
Shares used in computing net loss per share of common stock, basic and diluted |
|
41,059 |
|
38,257 |
|
40,385 |
|
24,709 |
|
(1) Amounts include stock-based compensation expense as follows:
|
|
Three Months |
|
For the Year |
| ||||||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Cost of subscription and support revenue |
|
$ |
424 |
|
$ |
179 |
|
$ |
1,626 |
|
$ |
496 |
|
Cost of professional services and other revenue |
|
607 |
|
245 |
|
2,363 |
|
690 |
| ||||
Research and development |
|
1,737 |
|
479 |
|
5,353 |
|
2,084 |
| ||||
Sales and marketing |
|
2,841 |
|
647 |
|
8,860 |
|
2,293 |
| ||||
General and administrative |
|
2,078 |
|
885 |
|
6,918 |
|
2,512 |
| ||||
Total stock-based compensation expense |
|
$ |
7,687 |
|
$ |
2,435 |
|
$ |
25,120 |
|
$ |
8,075 |
|
MARKETO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
|
Three Months Ended |
|
For the Year Ended |
| ||||||||
|
|
2014 |
|
2013 |
|
2014 |
|
2013 |
| ||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
| ||||
Net loss: |
|
|
|
|
|
|
|
|
| ||||
Net loss attributable to Marketo |
|
$ |
(15,913 |
) |
$ |
(15,495 |
) |
$ |
(54,337 |
) |
$ |
(47,360 |
) |
Net loss attributable to redeemable non-controlling interests |
|
(242 |
) |
|
|
(618 |
) |
|
| ||||
Net loss |
|
(16,155 |
) |
(15,495 |
) |
(54,955 |
) |
(47,360 |
) | ||||
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
| ||||
Depreciation and amortization |
|
2,699 |
|
1,584 |
|
9,475 |
|
4,621 |
| ||||
Stock-based compensation expense |
|
7,687 |
|
2,435 |
|
25,120 |
|
8,075 |
| ||||
Deferred income taxes |
|
(625 |
) |
(65 |
) |
(672 |
) |
(65 |
) | ||||
Loss on sale of assets |
|
1 |
|
|
|
1 |
|
|
| ||||
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
| ||||
Accounts receivable, net |
|
(11,884 |
) |
(13,461 |
) |
(11,362 |
) |
(12,702 |
) | ||||
Prepaid expenses and other current assets |
|
540 |
|
1,390 |
|
(1,388 |
) |
(698 |
) | ||||
Other assets |
|
(75 |
) |
5 |
|
(709 |
) |
(46 |
) | ||||
Accounts payable |
|
(436 |
) |
993 |
|
(342 |
) |
2,050 |
| ||||
Accrued expenses and other current liabilities |
|
5,033 |
|
7,078 |
|
(1,599 |
) |
13,177 |
| ||||
Deferred revenue |
|
10,042 |
|
10,592 |
|
22,371 |
|
20,438 |
| ||||
Other liabilities |
|
(12 |
) |
(3 |
) |
37 |
|
141 |
| ||||
Net cash used in operating activities |
|
(3,185 |
) |
(4,947 |
) |
(14,023 |
) |
(12,369 |
) | ||||
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
| ||||
Purchase of property and equipment |
|
(2,136 |
) |
(3,167 |
) |
(8,378 |
) |
(11,401 |
) | ||||
Capitalized software development |
|
(182 |
) |
(114 |
) |
(645 |
) |
(459 |
) | ||||
Cash provided by (used in) acquisition, net of cash acquired |
|
326 |
|
(6,216 |
) |
326 |
|
(6,216 |
) | ||||
Net cash used in investing activities |
|
(1,992 |
) |
(9,497 |
) |
(8,697 |
) |
(18,076 |
) | ||||
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
| ||||
Proceeds from initial public offering, net of underwriting discount |
|
|
|
|
|
|
|
80,506 |
| ||||
Proceeds from follow-on offering, net of underwriting discount |
|
|
|
|
|
|
|
22,519 |
| ||||
Proceeds from private placement |
|
|
|
|
|
|
|
6,500 |
| ||||
Proceeds from issuance of common stock upon exercise of stock options |
|
826 |
|
2,507 |
|
5,540 |
|
4,985 |
| ||||
Proceeds from issuance of common stock issued under employee stock purchase plan |
|
|
|
|
|
6,143 |
|
|
| ||||
Investment from redeemable non-controlling interests |
|
|
|
|
|
1,953 |
|
|
| ||||
Repurchase of unvested common stock from terminated employees |
|
(1 |
) |
(2 |
) |
(49 |
) |
(22 |
) | ||||
Withholding taxes remitted for the net share settlement of equity awards |
|
(518 |
) |
|
|
(2,638 |
) |
(124 |
) | ||||
Proceeds from issuance of debt |
|
|
|
|
|
|
|
4,500 |
| ||||
Repayment of debt |
|
(663 |
) |
(290 |
) |
(2,187 |
) |
(582 |
) | ||||
Payment of deferred initial public offering and follow-on offering costs |
|
|
|
(35 |
) |
(104 |
) |
(35 |
) | ||||
Payment incurred for common stock registration related to acquisition |
|
|
|
(437 |
) |
(319 |
) |
(3,820 |
) | ||||
Net cash provided by (used in) financing activities |
|
(356 |
) |
1,743 |
|
8,339 |
|
114,427 |
| ||||
Effect of foreign exchange rate changes on cash and cash equivalents |
|
(617 |
) |
80 |
|
(1,274 |
) |
70 |
| ||||
Net increase (decrease) in cash and cash equivalents |
|
(6,150 |
) |
(12,621 |
) |
(15,655 |
) |
84,052 |
| ||||
Cash and cash equivalents beginning of period |
|
118,794 |
|
140,920 |
|
128,299 |
|
44,247 |
| ||||
Cash and cash equivalents end of period |
|
$ |
112,644 |
|
$ |
128,299 |
|
$ |
112,644 |
|
$ |
128,299 |
|
MARKETO, INC.
RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES
(In thousands, except per share data)
(Unaudited)
To supplement our condensed consolidated financial statements presented on a GAAP basis, Marketo uses non-GAAP measures of operating loss, net loss and net loss per share, which are adjusted to exclude certain costs, expenses, gains and losses we believe appropriate to enhance an overall understanding of our past financial performance and also our prospects for the future. These adjustments to our current period GAAP results are made with the intent of providing both management and investors a more complete understanding of Marketos underlying operational results and trends and our marketplace performance. In addition, these adjusted non-GAAP results are among the information management uses as a basis for our planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for results prepared in accordance with generally accepted accounting principles in the United States of America.
|
|
Three Months Ended |
|
Three Months Ended |
|
Three Months Ended |
|
For the Year Ended |
|
For the Year Ended |
| |||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
| |||||
Subscription and support |
|
$ |
34,210 |
|
$ |
37,003 |
|
$ |
25,153 |
|
$ |
131,060 |
|
$ |
85,095 |
|
Professional services and other |
|
5,077 |
|
5,342 |
|
3,018 |
|
18,894 |
|
10,823 |
| |||||
Total Revenue |
|
$ |
39,287 |
|
$ |
42,345 |
|
$ |
28,171 |
|
$ |
149,954 |
|
$ |
95,918 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Cost of revenue reconciliation: |
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP Subscription and support |
|
$ |
7,527 |
|
$ |
8,104 |
|
$ |
6,295 |
|
$ |
28,742 |
|
$ |
24,681 |
|
Stock-based compensation |
|
(399 |
) |
(424 |
) |
(179 |
) |
(1,626 |
) |
(496 |
) | |||||
Amortization of acquired intangible assets |
|
(286 |
) |
(300 |
) |
(95 |
) |
(1,156 |
) |
(267 |
) | |||||
Non-GAAP subscription and support |
|
$ |
6,842 |
|
$ |
7,380 |
|
$ |
6,021 |
|
$ |
25,960 |
|
$ |
23,918 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP Professional services and other |
|
$ |
5,698 |
|
$ |
5,980 |
|
$ |
3,991 |
|
$ |
22,059 |
|
$ |
13,298 |
|
Stock-based compensation |
|
(699 |
) |
(607 |
) |
(245 |
) |
(2,363 |
) |
(690 |
) | |||||
Amortization of acquired intangible assets |
|
|
|
|
|
|
|
|
|
|
| |||||
Non-GAAP professional services and other |
|
$ |
4,999 |
|
$ |
5,373 |
|
$ |
3,746 |
|
$ |
19,696 |
|
$ |
12,608 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Gross profit and gross margin reconciliation: |
|
|
|
|
|
|
|
|
|
|
| |||||
Non-GAAP subscription and support gross profit |
|
$ |
27,368 |
|
$ |
29,623 |
|
$ |
19,132 |
|
$ |
105,100 |
|
$ |
61,177 |
|
Non-GAAP professional services and other gross profit |
|
78 |
|
(31 |
) |
(728 |
) |
(802 |
) |
(1,785 |
) | |||||
Non-GAAP gross profit |
|
$ |
27,446 |
|
$ |
29,592 |
|
$ |
18,404 |
|
$ |
104,298 |
|
$ |
59,392 |
|
Non-GAAP subscription and support gross margin |
|
80.0 |
% |
80.1 |
% |
76.1 |
% |
80.2 |
% |
71.9 |
% | |||||
Non-GAAP professional services and other gross margin |
|
1.5 |
% |
-0.6 |
% |
-24.1 |
% |
-4.2 |
% |
-16.5 |
% | |||||
Non-GAAP gross margin |
|
69.9 |
% |
69.9 |
% |
65.3 |
% |
69.6 |
% |
61.9 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Operating expenses reconciliation: |
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP Research and development |
|
$ |
7,681 |
|
$ |
8,327 |
|
$ |
6,402 |
|
$ |
30,337 |
|
$ |
23,321 |
|
Stock-based compensation |
|
(1,364 |
) |
(1,737 |
) |
(479 |
) |
(5,353 |
) |
(2,084 |
) | |||||
Amortization of acquired intangible assets |
|
|
|
(6 |
) |
|
|
(6 |
) |
|
| |||||
Non-GAAP research and development |
|
$ |
6,317 |
|
$ |
6,584 |
|
$ |
5,923 |
|
$ |
24,978 |
|
$ |
21,237 |
|
As a % of total revenues, non-GAAP |
|
16.1 |
% |
15.5 |
% |
21.0 |
% |
16.7 |
% |
22.1 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP Sales and marketing |
|
$ |
24,973 |
|
$ |
29,716 |
|
$ |
19,719 |
|
$ |
98,843 |
|
$ |
62,769 |
|
Stock-based compensation |
|
(2,145 |
) |
(2,841 |
) |
(647 |
) |
(8,860 |
) |
(2,293 |
) | |||||
Amortization of acquired intangible assets |
|
(136 |
) |
(137 |
) |
(52 |
) |
(566 |
) |
(181 |
) | |||||
Non-GAAP sales and marketing |
|
$ |
22,692 |
|
$ |
26,738 |
|
$ |
19,020 |
|
$ |
89,417 |
|
$ |
60,295 |
|
As a % of total revenues, non-GAAP |
|
57.8 |
% |
63.1 |
% |
67.5 |
% |
59.6 |
% |
62.9 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP General and administrative |
|
$ |
6,594 |
|
$ |
7,066 |
|
$ |
6,996 |
|
$ |
25,583 |
|
$ |
18,655 |
|
Stock-based compensation |
|
(1,908 |
) |
(2,078 |
) |
(885 |
) |
(6,918 |
) |
(2,512 |
) | |||||
Amortization of acquired intangible assets |
|
(46 |
) |
(46 |
) |
(29 |
) |
(184 |
) |
(103 |
) | |||||
Litigation settlement |
|
|
|
|
|
(950 |
) |
|
|
(950 |
) | |||||
Acquisition related costs |
|
|
|
(185 |
) |
(734 |
) |
(185 |
) |
(734 |
) | |||||
Non-GAAP general and administrative |
|
$ |
4,640 |
|
$ |
4,757 |
|
$ |
4,398 |
|
$ |
18,296 |
|
$ |
14,356 |
|
As a % of total revenues, non-GAAP |
|
11.8 |
% |
11.2 |
% |
15.6 |
% |
12.2 |
% |
15.0 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Loss from operations reconciliation: |
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP loss from operations |
|
$ |
(13,186 |
) |
$ |
(16,848 |
) |
$ |
(15,232 |
) |
$ |
(55,610 |
) |
$ |
(46,806 |
) |
Stock-based compensation |
|
6,515 |
|
7,687 |
|
2,435 |
|
25,120 |
|
8,075 |
| |||||
Amortization of acquired intangible assets |
|
468 |
|
489 |
|
176 |
|
1,912 |
|
551 |
| |||||
Litigation settlement |
|
|
|
|
|
950 |
|
|
|
950 |
| |||||
Acquisition related costs |
|
|
|
185 |
|
734 |
|
185 |
|
734 |
| |||||
Non-GAAP loss from operations |
|
$ |
(6,203 |
) |
$ |
(8,487 |
) |
$ |
(10,937 |
) |
$ |
(28,393 |
) |
$ |
(36,496 |
) |
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net loss reconciliation: |
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP Net loss attributable to Marketo |
|
$ |
(12,803 |
) |
$ |
(15,913 |
) |
$ |
(15,495 |
) |
$ |
(54,337 |
) |
$ |
(47,360 |
) |
Stock-based compensation |
|
6,515 |
|
7,687 |
|
2,435 |
|
25,120 |
|
8,075 |
| |||||
Amortization of acquired intangible assets |
|
468 |
|
489 |
|
176 |
|
1,912 |
|
551 |
| |||||
Litigation settlement |
|
|
|
|
|
950 |
|
|
|
950 |
| |||||
Acquisition related costs |
|
|
|
185 |
|
734 |
|
185 |
|
734 |
| |||||
Non-GAAP Net loss attributable to Marketo |
|
$ |
(5,820 |
) |
$ |
(7,552 |
) |
$ |
(11,200 |
) |
$ |
(27,120 |
) |
$ |
(37,050 |
) |
|
|
|
|
|
|
|
|
|
|
|
| |||||
Basic and diluted net loss per share |
|
|
|
|
|
|
|
|
|
|
| |||||
GAAP |
|
$ |
(0.31 |
) |
$ |
(0.39 |
) |
$ |
(0.41 |
) |
$ |
(1.35 |
) |
$ |
(1.92 |
) |
Non-GAAP |
|
$ |
(0.14 |
) |
$ |
(0.18 |
) |
$ |
(0.29 |
) |
$ |
(0.67 |
) |
$ |
(1.50 |
) |
|
|
|
|
|
|
|
|
|
|
|
| |||||
Shares used to compute basic and diluted GAAP and non-GAAP net loss per share |
|
40,668 |
|
41,059 |
|
38,257 |
|
40,385 |
|
24,709 |
|
MARKETO, INC.
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS PER SHARE TARGETS
(In thousands, except per share data)
(Unaudited)
|
|
Three Months Ending |
|
Twelve Months Ending |
| ||||||||||||
|
|
March 31, 2015 |
|
December 31, 2015 |
| ||||||||||||
GAAP net loss per diluted share range |
|
$ |
(0.46 |
) |
- |
|
$ |
(0.48 |
) |
$ |
(2.01 |
) |
- |
|
$ |
(2.05 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Stock-based compensation |
|
0.25 |
|
|
|
0.25 |
|
1.12 |
|
|
|
1.12 |
| ||||
Amortization of acquired intangibles per share |
|
0.01 |
|
|
|
0.01 |
|
0.06 |
|
|
|
0.06 |
| ||||
Non-GAAP net loss per diluted share range |
|
$ |
(0.20 |
) |
- |
|
$ |
(0.22 |
) |
$ |
(0.83 |
) |
- |
|
$ |
(0.87 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Weighted Average Shares Outstanding |
|
41,600 |
|
|
|
41,600 |
|
42,300 |
|
|
|
42,300 |
|
The GAAP and non-GAAP net income per share targets provided below and elsewhere in this press release are estimates. Marketos future performance involves risks and uncertainties and the Companys actual results could differ materially from such estimates. Some of the factors that could affect the Companys operating results are set forth under the caption Safe harbor statement under the Private Securities Litigation Reform Act of 1995 in this release.