BOZEMAN, Mont., July 30 MT-RNOW-2Q-Earns
BOZEMAN, Mont., July 30 /PRNewswire-FirstCall/ -- RightNow(R)
Technologies, Inc. (Nasdaq: RNOW) today announced results for the second
quarter ended June 30, 2008. Total revenue in the second quarter of 2008 was
$35.2 million, compared to $26.5 million in the second quarter of 2007,
reflecting 33% growth in revenue over the second quarter of 2007. Net loss in
the second quarter of 2008 was $(3.1) million or $(0.09) per share, compared
to a net loss of $(5.7) million or $(0.17) per share, in the second quarter of
2007. Non-GAAP net loss per share in the second quarter of 2008, which
excludes stock-based compensation charges of $1.9 million, was $(1.2) million
or $(0.04) per share, as compared to Non-GAAP net loss of $(3.8) million or
$(0.11) per share, in the second quarter of 2007.
Revenue for the six months ended June 30, 2008 was $68.1 million, compared
to $52.2 million for the comparable period in 2007. Net loss for the six
months ended June 30, 2008 was $(6.5) million or $(0.19) per share, as
compared to $(11.7) million or $(0.36) per share, for the comparable period in
2007. Non-GAAP net loss for the six months ended June 30, 2008, which
excludes stock-based compensation charges of $3.2 million, was $(3.4) million
or $(0.10) per share, as compared to Non-GAAP net loss of $(8.5) million or
$(0.26) per share, for the comparable period in 2007.
New, renewed and expanded customer relationships during the second quarter
of 2008 included Activision, Beretta USA, Department of Homeland Security,
Enterprise Rent-A-Car, Hertz Europe, LifeLock, NutriSystem, NVIDIA,
RealNetworks, Sovereign Bank, and Virgin Mobile Australia.
"We remain focused on execution and believe we are positioned well to take
advantage of a tremendous market opportunity," stated Greg Gianforte, founder
and CEO. "Our success is being driven by the strength of our solutions which
enable our clients to retain and enhance relationships with existing
customers, provide great customer experiences, and demonstrate a quick and
measurable return on investment. This core value proposition resonates at the
highest executive levels within our enterprise target market."
"We are pleased to report another strong quarter with revenue and earnings
above guidance," said Jeff Davison, CFO. "This quarter was our sixth
consecutive quarter of operating margin improvement as we continue to gain
operating leverage through our land and expand strategy. We remain positive
about the growth opportunities we see in the second half of 2008 and are
raising our full year revenue guidance."
Guidance
-- For the full year 2008, revenue is expected to be in the range of $141
to $143 million, with recurring revenue growth of approximately 25%.
-- Net loss per share for the full year 2008 is expected to be in the
range of $(0.30) to $(0.26). Non-GAAP net loss per share, which excludes
stock-based compensation, is expected to be in the range of $(0.11) to $(0.07)
for the full year 2008.
-- Cash from operations for the full year 2008 is expected to be in the
range of $25 to $30 million.
-- For the third quarter of 2008, revenue is expected to be in the range
of $36 to $37 million. Third quarter net loss per share is expected to be in
the range of $(0.08) to $(0.06). Non-GAAP net loss per share, which excludes
stock-based compensation, is expected to be in the range of $(0.03) to $(0.01)
for the third quarter of 2008.
Quarterly Conference Call
RightNow Technologies will discuss its quarterly results today via
teleconference at 2:30 p.m. Mountain Time (4:30 p.m. Eastern Time.) To access
the call, please dial 877-440-5786, or outside the U.S. 719-325-4873, at least
five minutes prior to the 2:30 p.m. MT start time. A live webcast of the call
will also be available at http://investor.rightnow.com/events.cfm under the
Investor Webcasts menu. An audio replay will be available between 5:30 p.m. MT
on July 30, 2008 and 12:00 a.m. MT on August 14, 2008 by calling 888-203-1112
or 719-457-0820, with passcode 9046901. The replay will also be available on
our website at http://investor.rightnow.com/events.cfm.
About RightNow Technologies
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. Approximately 1,900 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 http://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; 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 RightNow 8 product; the gain or loss
of key customers; competitive pressures; our ability to expand operations;
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; our ability to manage and expand our partner
relationships; our ability to expand, retain and motivate our employees and
manage our growth, and general economic conditions. 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
RightNow Technologies, Inc.
Consolidated Balance Sheets
(In thousands) (Unaudited)
June 30,Dec 31,
2008 2007
Assets
Cash and cash equivalents$52,781$43,681
Short-term investments41,540 52,644
Accounts receivable 26,722 29,480
Term receivables, current 8,814 13,069
Allowance for doubtful accounts (2,177)(1,918)
Net receivables 33,359 40,631
Deferred commissions 3,970 3,336
Prepaid and other current assets 3,112 2,643
Total current assets 134,762142,935
Long-term investments 11,925 --
Property and equipment, net 10,798 10,856
Term receivables, non-current 5,728 9,859
Intangible assets, net 7,206 7,996
Deferred commissions, non-current 2,305 1,680
Other514460
Total Assets$173,238 $173,786
Liabilities and Stockholders' Equity
Accounts payable $5,982 $4,386
Commissions and bonuses payable4,279 5,044
Other accrued liabilities 11,937 11,404
Current portion of long-term debt 44 43
Current portion of deferred revenue 76,693 76,995
Total current liabilities 98,935 97,872
Long-term debt, less current portion 45 68
Deferred revenue, net of current portion 39,289 37,665
Stockholders' equity:
Common stock34 33
Additional paid-in capital 99,187 95,377
Accumulated other comprehensive loss (787) (292)
Accumulated deficit(63,465) (56,937)
Total stockholders' equity 34,969 38,181
Total Liabilities Stockholders' Equity $173,238 $173,786
RightNow Technologies, Inc.
Consolidated Operating Statements
(In thousands, except per share amounts) (Unaudited)
Three Months EndedSix Months Ended
June 30, June 30,
2008 2007 2008 2007
Revenue:
Software, hosting
and support
Recurring* $25,459 $20,341 $49,871 $39,566
Perpetual114 352 258 946
Professional services9,6485,772 17,990 11,655
Total revenue 35,221 26,465 68,119 52,167
Cost of revenue:
Software, hosting
and support 5,0434,565 10,0788,959
Professional
services 7,8105,036 15,095 10,207
Total cost of
revenue 12,8539,601 25,173 19,166
Gross profit22,368 16,864 42,946 33,001
Operating expenses:
Sales and marketing 17,627 15,788 34,445 31,515
Research and
development 4,5074,3438,9938,639
General and
administrative3,8903,1787,4066,038
Total operating
expenses 26,024 23,309 50,844 46,192
Loss from operations(3,656) (6,445) (7,898) (13,191)
Interest and other
income (expense), net 519 8851,4571,713
Loss before income
taxes (3,137) (5,560) (6,441) (11,478)
Benefit (provision)
for income taxes5 (181) (87)(265)
Net loss $(3,132) $(5,741) $(6,528)$(11,743)
Net loss per share:
Basic $(0.09) $(0.17) $(0.19) $(0.36)
Diluted $(0.09) $(0.17) $(0.19) $(0.36)
Shares used in the
computation:
Basic 33,582 32,983 33,557 32,921
Diluted 33,582 32,983 33,557 32,921
Supplemental
information of
stock-based
compensation
expense
included in:
Cost of software,
hosting and support $79 $79 $156 $137
Cost of professional
services165 149 318 274
Sales and marketing 595 7311,1331,389
Research and
development 242 289 477 515
General and
administrative 816 7431,079 978
Total stock-based
compensation $1,897 $1,991 $3,163 $3,293
* Recurring revenue includes software, hosting and support revenue from
term license and subscription agreements, and post contract support
services.
RightNow Technologies, Inc.
Consolidated Statements of Cash Flow
(In thousands) (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
20082007 20082007
Operating
activities:
Net loss $(3,132) $(5,741) $(6,528)$(11,743)
Non-cash
adjustments:
Depreciation
and amortization 1,9431,8803,8863,555
Stock-based
compensation 1,8971,9913,1633,293
Provision
(recoveries)
for losses on
accounts receivable 26 13 115 (56)
Changes in operating
accounts:
Receivables4,0628,224 11,509 23,651
Prepaid expenses 5 (412)(443)(983)
Deferred commissions(809) (1,200) (1,213) (2,100)
Accounts payable(174) (60) 1,584 (1,193)
Commissions and
bonuses payable 742 (1)(781) (1,172)
Other accrued
liabilities (83) 870 4513,751
Deferred revenue 4,001 (814) 567 (6,870)
Other 96 13 (66) (10)
Cash provided by
operating activities8,5744,763 12,244 10,123
Investing activities:
Net change in
short-term investments748 (15,333) (1,222) (13,784)
Acquisition of property
and equipment (1,524) (1,351) (3,033) (3,338)
Other (12) (32) (27) (61)
Cash used by investing
activities (788) (16,716) (4,282) (17,183)
Financing activities:
Proceeds from issuance
of common stock 234 536 6481,179
Excess tax benefit of
stock options exercised(53) 160- 209
Payments on long-term
debt (11) (8) (22) (15)
Cash provided by
financing activities 170 688 6261,373
Effect of foreign
exchange rates on
cash and cash
equivalents 234 208 512 321
Increase (decrease) in
cash and cash
equivalents 8,190 (11,057) 9,100 (5,366)
Cash and cash
equivalents at
beginning of period44,591 44,899 43,681 39,208
Cash and cash
equivalents at end
of period $52,781 $33,842 $52,781 $33,842
RightNow Technologies, Inc.
Reconciliation of Non-GAAP Measurements
(Amounts in thousands, except per share amounts) (Unaudited)
Diluted Earnings Per Share Reconciliation
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Net loss as reported $(3,132) $(5,741) $(6,528)$(11,743)
Add stock-based
compensation ("SBC")1,8971,9913,1633,293
Net loss before SBC$(1,235) $(3,750) $(3,365) $(8,450)
Net loss per share,
as reported$(0.09) $(0.17) $(0.19) $(0.36)
Net loss per share,
before SBC $(0.04) $(0.11) $(0.10) $ (0.26)
Shares outstanding,
as reported33,582 32,983 33, 557 32,921
Shares outstanding,
excluding the effect
of SBC 33,582 32,983 33,557 32,921
Forward-Looking Guidance Reconciliation
Third quarter
ending
SeptemberGAAP Guidance Non-GAAP Guidance
30, 2008 From To Adjustment FromTo
Net loss $(2,000)$(2,600) $1,500[a] $(500)$(1,100)
Net loss
per share$(0.06) $(0.08) $(0.01) $(0.03)
Shares33,800 33,800 33,800 33,800
Year ending
December 31,
2008
Net loss $(8,700) $(10,000) $6,200[a] $(2,500)$(3,800)
Net loss
per share $(0.26) $(0.30) $(0.07) $(0.11)
Shares 33,800 33,800 33,800 33,800
[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.
About Non-GAAP Financial Measures
Non-GAAP net loss and diluted net loss per share are supplemental measures
of our performance that are not required by, or presented in accordance with
GAAP. These non-GAAP financial measures are not intended to be used in
isolation and should not be considered a substitute for net loss and net loss
per share or any other performance measure determined in accordance with GAAP.
We present non-GAAP net loss and net loss per share because we consider each
to be an important supplemental measure of our performance.
Management uses these non-GAAP financial measures to make operational
decisions, evaluate the Company's performance, prepare forecasts and determine
compensation. Further, management believes that both management and investors
benefit from referring to these non-GAAP financial measures in assessing the
Company's performance when planning, forecasting and analyzing future periods.
Our stock-based compensation expenses are expected to vary depending on the
number of new grants issued, changes in our stock price, stock market
volatility, expected option lives and risk-free rates of return, all of which
are difficult to estimate. In calculating non-GAAP net loss and net loss per
share, management excludes stock-based compensation expenses to facilitate its
review of the comparability of the Company's operating performance on a
period-to-period basis because such expenses are not, in management's view,
related to the Company's ongoing operating performance. Management uses this
view of its operating performance for purposes of comparison with its business
plan and individual operating budgets and resource allocation.
Management further believes that these non-GAAP financial measures are
useful to investors in providing greater transparency to the information used
by management in its operational decision making. We believe that the use of
non-GAAP net loss and net loss per share also facilitate a comparison of
RightNow's underlying operating performance with that of other companies in
our industry, which use similar non-GAAP financial measures to supplement
their GAAP results.
Calculating non-GAAP net loss and net loss per share have limitations as
an analytical tool, and readers should not consider these measures in
isolation or as substitutes for GAAP net loss and GAAP net loss per share. In
the future, we expect to incur additional stock-based compensation expenses
and the exclusion of these expenses in the presentation of our non-GAAP
financial measures should not be construed as an inference that these costs
are unusual, infrequent or non-recurring. Investors and potential investors
are cautioned that there are material limitations associated with the use of
non-GAAP financial measures as an analytical tool, which include:
-- Other companies inside and outside of our industry may calculate
non-GAAP net loss and net loss per share differently than we do, limiting
their usefulness as a comparative tool; and
-- The Company's income tax expense or benefit will be ultimately based on
its GAAP taxable income and actual tax rates in effect, which may differ
significantly from the effective tax rate used in our non-GAAP financial
measures.
In addition, the adjustments to our GAAP financial measures reflect the
exclusion of stock-based compensation expenses that are recurring and will be
reflected in the Company's financial results for the foreseeable future. The
Company compensates for these limitations by providing specific information
regarding the GAAP amount excluded from the non-GAAP financial measures. The
Company further compensates for the limitations of our use of non-GAAP
financial measures by presenting comparable GAAP measures more prominently.
The Company evaluates the non-GAAP financial measures together with the most
directly comparable GAAP financial measures.
Investors and potential investors are encouraged to review the
reconciliation of non-GAAP financial measures contained within this press
release with our GAAP net loss and net loss per share. For more information,
see the consolidated operating statements and reconciliation of non-GAAP
measurements contained in this press release.
SOURCE RightNow Technologies, Inc.
