SANTA CLARA, Calif.,
April 27, 2017 /PRNewswire/ -- Gigamon Inc.
(NYSE:GIMO), the leader in traffic visibility solutions, today
released financial results for its first quarter ended
April 1, 2017.
First Quarter 2017 Financial Highlights:
- Revenue of $69.6 million, up 4%
year-over-year.
- GAAP gross margin was 81%, compared to 81% in the first quarter
of fiscal 2016.
- Non-GAAP gross margin was 82%, compared to 82% in the first
quarter of fiscal 2016.
- GAAP net loss was $(2.2) million,
or $(0.06) per basic and diluted
share, compared to GAAP net income of $3.0
million, or $0.08 per diluted
share, in the first quarter of fiscal 2016.
- Non-GAAP net income was $4.6
million, or $0.12 per diluted
share, compared to non-GAAP net income of $8.2 million, or $0.22 per diluted share, in the first quarter of
fiscal 2016.
- Cash and short-term investments were $265 million, up $7
million from the fourth quarter of 2016 and up $57 million from the first quarter of fiscal
2016.
"We continue to make progress as we focus on a recovery to
sustained and strong growth with results this quarter ahead of our
expectations, including a healthy bottom line," said Paul Hooper, Chief Executive Officer of Gigamon.
"As we enter Q2, we are implementing a number of changes in our
business that we expect will drive growth during the second half of
the year, including the appointment of our new CMO, Kim DeCarlis, the announcement of our
GigaVUE-HC3--the highest performance system in the market--and the
introduction of our in-line SSL solution offering new levels of
visibility, control and scale to the industry."
Recent Business Highlights:
- Introduced GigaVUE-HC3, the highest-performance appliance in
our HC family to enable pervasive visibility and security
intelligence at scale across 10, 40 and 100Gb networks.
- Gigamon Visibility Platform on Amazon Web Services (AWS) gained
momentum with availability in the AWS marketplace and
achieved elevated Amazon Partner Network (APN) and Public
Sector Program Partner statuses.
- Announced a significant expansion to Gigamon's GigaSECURE®
SSL/TLS decryption solution, with new inline capabilities, bringing
enhanced visibility into encrypted data-in-motion.
- Appointed longtime security veteran Arthur W. Coviello Jr. to its Board of
Directors to help guide the company's security strategy and
growth.
- Named industry marketing leader Kim DeCarlis as Chief
Marketing Officer to drive increased market opportunities, brand
awareness and industry leadership for Gigamon.
Conference Call Information:
Gigamon will host a conference call and live webcast for
analysts and investors at 5:00 p.m. Eastern time on
April 27, 2017. This news release and
a supplemental financial presentation will be available on the
company's website prior to the conference call. Parties
in the United States and Canada can access the
call by dialing +1 (877)-329-7568, using conference code
6085965. International parties can access the call by dialing
+1 (719)-457-2695, using conference code 6085965.
The webcast will be accessible on Gigamon's investor
relations website at http://investor.gigamon.com for a
period of one year. A telephonic replay of the conference call
will be available through Thursday, May 4, 2017. To access the
replay, parties in the United
States and Canada should call +1 (866)-375-1919 and
enter conference code 6085965. International parties should
call +1 (719)-457-0820 and enter conference code 6085965.
Non-GAAP Financial Measures
In addition to disclosing financial measures prepared in
accordance with U.S. generally accepted accounting principles
(GAAP), this press release and accompanying tables contain certain
non-GAAP financial measures that exclude stock-based compensation
and related payroll taxes, and income tax effects of stock-based
compensation expense. Non-GAAP financial measures do not have any
standardized meaning and our non-GAAP financial measures may not be
comparable to similarly titled measures presented by other
companies. Gigamon considers these non-GAAP financial
measures important because they provide useful measures of the
operating performance of the company, exclusive of unusual events
or factors that do not directly affect what we consider core to our
operating performance, and are used by the company's management for
that purpose. In addition, investors often use similar measures to
evaluate the operating performance of a company. We present
non-GAAP financial measures for supplemental informational purposes
only to provide additional information in understanding the
company's operating results. The non-GAAP financial measures should
not be considered a substitute for financial information presented
in accordance with GAAP. Please see the reconciliation of
non-GAAP financial measures to the most directly comparable GAAP
measures attached to this release.
During the conference call to discuss these financial results,
Gigamon expects to give guidance for the second quarter of fiscal
2017 on a non-GAAP basis. Gigamon does not provide
reconciliations of its forward-looking non-GAAP financial measures
to the corresponding GAAP measures due to the high variability and
difficulty in making accurate forecasts and projections with
respect to stock-based compensation and related payroll taxes, and
income tax effect of stock-based compensation expense, which are
excluded from these non-GAAP measures. In particular,
stock-based compensation and related taxes are impacted by future
hiring and retention needs, as well as the future fair market value
of Gigamon's common stock, all of which is difficult to predict and
subject to constant change. The actual amounts of these excluded
items will have a significant impact on Gigamon's GAAP net income
(loss) per diluted share and GAAP tax provision. Accordingly,
reconciliations of Gigamon's forward-looking non-GAAP financial
measures to the corresponding GAAP measures are not available
without unreasonable effort.
Legal Notice Regarding Forward Looking
Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements generally relate to future events or our future
financial or operating performance. In some cases, you can identify
forward-looking statements because they contain words such as
"may," "will," "should," "expects," "plans," "anticipates,"
"could," "intends," "target," "projects," "contemplates,"
"believes," "estimates," "predicts," "potential" or "continue" or
the negative of these words or other similar terms or expressions
that concern our expectations, strategy, plans or intentions.
Forward-looking statements in this press release include, but are
not limited to, our expectations regarding the future growth of our
business and the impact of changes we are making to enable growth.
Our expectations and beliefs regarding these matters may not
materialize, and actual results in future periods are subject to
risks and uncertainties that could cause actual results to differ
materially from those projected. These risks include our ability to
continue to deliver and improve our products and successfully
develop new products; customer acceptance and purchase of our
existing products and new products; our ability to retain existing
customers and generate new customers; the market for network
traffic visibility solutions not continuing to develop; competition
from other products and services; and general market, political,
economic and business conditions. The forward-looking
statements contained in this press release are also subject to
other risks and uncertainties, including those more fully described
in our filings with the Securities and Exchange Commission,
including our Annual Report on Form 10-K for the period
ended December 31, 2016. The forward-looking statements in
this press release are based on information available
to Gigamon as of the date hereof,
and Gigamon disclaims any obligation to update any
forward-looking statements, except as required by law.
Gigamon
Gigamon (NYSE: GIMO) provides active visibility into physical
and virtual network traffic, enabling stronger security and
superior performance. Gigamon's Visibility Fabric and GigaSECURE®,
the industry's first Security Delivery Platform, deliver advanced
intelligence so that security, network and application performance
management solutions in enterprise, government and service provider
networks operate more efficiently and effectively. See more at
www.gigamon.com, the Gigamon Blog, or follow Gigamon on Twitter,
LinkedIn, or Facebook.
Gigamon
Inc.
Consolidated
Statements of Income
(In thousands,
except per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
April 1,
2017
|
|
April 2,
2016
|
Revenue:
|
|
|
|
Product
|
$
|
44,010
|
|
|
$
|
44,662
|
|
Service
|
25,557
|
|
|
22,549
|
|
Total
revenue
|
69,567
|
|
|
67,211
|
|
Cost of
revenue:
|
|
|
|
Product
|
10,604
|
|
|
10,707
|
|
Service
|
2,706
|
|
|
2,082
|
|
Total cost of
revenue
|
13,310
|
|
|
12,789
|
|
Gross
profit
|
56,257
|
|
|
54,422
|
|
Operating
expenses:
|
|
|
|
Research and
development
|
20,149
|
|
|
15,358
|
|
Sales and
marketing
|
33,441
|
|
|
27,657
|
|
General and
administrative
|
9,055
|
|
|
7,995
|
|
Total operating
expenses
|
62,645
|
|
|
51,010
|
|
Income (loss) from
operations
|
(6,388)
|
|
|
3,412
|
|
Other income
(expense):
|
|
|
|
Interest
income
|
356
|
|
|
207
|
|
Other expense,
net
|
(117)
|
|
|
(69)
|
|
Income (loss) before
income tax (provision) benefit
|
(6,149)
|
|
|
3,550
|
|
Income tax benefit
(provision)
|
3,912
|
|
|
(579)
|
|
Net income
(loss)
|
$
|
(2,237)
|
|
|
$
|
2,971
|
|
Net income (loss) per
share:
|
|
|
|
Basic
|
$
|
(0.06)
|
|
|
$
|
0.09
|
|
Diluted
|
$
|
(0.06)
|
|
|
$
|
0.08
|
|
Weighted average
shares used in computing net income (loss) per share:
|
|
|
|
Basic
|
36,563
|
|
|
34,633
|
|
Diluted
|
36,563
|
|
|
36,546
|
|
Gigamon
Inc.
Consolidated
Balance Sheets
(In
thousands)
(unaudited)
|
|
|
April 1,
2017
|
|
December 31,
2016
|
ASSETS
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$
|
159,676
|
|
|
$
|
148,926
|
|
Short-term
investments
|
105,504
|
|
|
109,238
|
|
Accounts receivable,
net
|
56,526
|
|
|
75,522
|
|
Inventories,
net
|
11,908
|
|
|
11,347
|
|
Prepaid expenses and
other current assets
|
12,137
|
|
|
9,909
|
|
Total current
assets
|
345,751
|
|
|
354,942
|
|
Property and
equipment, net
|
12,448
|
|
|
11,809
|
|
Deferred tax assets,
non-current
|
44,458
|
|
|
33,094
|
|
Other assets,
non-current
|
2,272
|
|
|
1,154
|
|
TOTAL
ASSETS
|
$
|
404,929
|
|
|
$
|
400,999
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
Accounts
payable
|
$
|
6,591
|
|
|
$
|
5,208
|
|
Accrued
liabilities
|
20,490
|
|
|
34,649
|
|
Deferred
revenue
|
67,484
|
|
|
68,997
|
|
Total current
liabilities
|
94,565
|
|
|
108,854
|
|
Deferred revenue,
non-current
|
28,351
|
|
|
28,785
|
|
Deferred and other
tax liabilities, non-current
|
288
|
|
|
201
|
|
Other liabilities,
non-current
|
312
|
|
|
499
|
|
TOTAL
LIABILITIES
|
123,516
|
|
|
138,339
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
Common
stock
|
4
|
|
|
4
|
|
Additional
paid-in-capital
|
274,287
|
|
|
256,774
|
|
Accumulated other
comprehensive loss
|
(49)
|
|
|
(17)
|
|
Accumulated
equity
|
7,171
|
|
|
5,899
|
|
TOTAL STOCKHOLDERS'
EQUITY
|
281,413
|
|
|
262,660
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$
|
404,929
|
|
|
$
|
400,999
|
|
Gigamon
Inc.
Consolidated
Statements of Cash Flows
(In
thousands)
(unaudited)
|
|
|
Three Months
Ended
|
|
April 1,
2017
|
April 2,
2016
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
Net income
(loss)
|
$
|
(2,237)
|
|
|
$
|
2,971
|
|
Adjustments to
reconcile net income (loss) to net cash provided by (used
in) operating activities:
|
|
|
|
Depreciation and
amortization
|
2,021
|
|
|
1,271
|
|
Stock-based
compensation expense
|
12,554
|
|
|
8,176
|
|
Deferred and other
income taxes
|
(4,137)
|
|
|
(117)
|
|
Inventory write-down,
net
|
206
|
|
|
175
|
|
Write down of fixed
assets
|
29
|
|
|
—
|
|
Bad debt
expense
|
—
|
|
|
25
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
18,996
|
|
|
2,263
|
|
Inventories
|
(770)
|
|
|
(2,073)
|
|
Prepaid expenses and
other assets
|
(2,792)
|
|
|
654
|
|
Accounts
payable
|
1,718
|
|
|
(254)
|
|
Accrued liabilities
and other liabilities
|
(14,371)
|
|
|
(13,076)
|
|
Deferred
revenue
|
(1,947)
|
|
|
(3,282)
|
|
Net cash provided by
(used in) operating activities
|
9,270
|
|
|
(3,267)
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
Purchase of
short-term investments
|
(33,710)
|
|
|
(29,107)
|
|
Proceeds from
maturities of short-term investments
|
37,500
|
|
|
26,786
|
|
Purchase of property
and equipment
|
(2,695)
|
|
|
(2,107)
|
|
Net cash provided by
(used in) investing activities
|
1,095
|
|
|
(4,428)
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
Proceeds from
employee stock purchase plan
|
4,956
|
|
|
3,368
|
|
Proceeds from
exercise of stock options
|
581
|
|
|
1,377
|
|
Shares repurchased
for tax withholdings on vesting of restricted stock
units
|
(4,339)
|
|
|
(1,385)
|
|
Net cash provided by
financing activities
|
1,198
|
|
|
3,360
|
|
NET INCREASE
(DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH
|
11,563
|
|
|
(4,335)
|
|
CASH, CASH
EQUIVALENTS AND RESTRICTED CASH - Beginning of period
|
148,926
|
|
|
120,212
|
|
CASH, CASH
EQUIVALENTS AND RESTRICTED CASH - End of period
|
$
|
160,489
|
|
|
$
|
115,877
|
|
|
|
|
|
Gigamon
Inc.
Reconciliation of
GAAP to Non-GAAP Financial Measures
(In thousands,
except percentages)
(unaudited)
|
|
|
Three Months
Ended
|
|
April 1,
2017
|
|
April 2,
2016
|
Total
Revenue
|
$
|
69,567
|
|
|
$
|
67,211
|
|
Reconciliation of
GAAP Gross Profit and GAAP Gross Margin to Non-GAAP Gross Profit
and Non-GAAP Gross Margin:
|
|
|
|
GAAP gross
profit
|
56,257
|
|
|
54,422
|
|
Stock-based
compensation expense
|
677
|
|
|
470
|
|
Stock-based
compensation related payroll taxes
|
31
|
|
|
16
|
|
Non-GAAP gross
profit
|
$
|
56,965
|
|
|
$
|
54,908
|
|
GAAP gross
margin
|
81
|
%
|
|
81
|
%
|
Non-GAAP gross
margin
|
82
|
%
|
|
82
|
%
|
Reconciliation of
GAAP Operating Income (Loss) to Non-GAAP Operating
Income:
|
|
|
|
GAAP operating income
(loss)
|
$
|
(6,388)
|
|
|
$
|
3,412
|
|
Stock-based
compensation expense
|
12,554
|
|
|
8,176
|
|
Stock-based
compensation related payroll taxes
|
507
|
|
|
282
|
|
Non-GAAP operating
income
|
$
|
6,673
|
|
|
$
|
11,870
|
|
Reconciliation of
GAAP Net Income (Loss) to Non-GAAP Net Income:
|
|
|
|
GAAP net income
(loss)
|
$
|
(2,237)
|
|
|
$
|
2,971
|
|
Stock-based
compensation expense
|
12,554
|
|
|
8,176
|
|
Stock-based
compensation related payroll taxes
|
507
|
|
|
282
|
|
Income tax effect of
Non-GAAP adjustments
|
(6,193)
|
|
|
(3,253)
|
|
Non-GAAP net
income
|
$
|
4,631
|
|
|
$
|
8,176
|
|
Gigamon
Inc.
Reconciliation of
GAAP to Non-GAAP Financial Measures (continued)
(In thousands,
except per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
April 1,
2017
|
|
April 2,
2016
|
Reconciliation of
GAAP Diluted Net Income (Loss) per Share to Non-GAAP Diluted Net
Income per Share:
|
|
|
|
GAAP diluted net
income (loss) per share
|
$
|
(0.06)
|
|
|
$
|
0.08
|
|
Stock-based
compensation expense
|
0.35
|
|
|
0.22
|
|
Stock-based
compensation related payroll taxes
|
0.01
|
|
|
0.01
|
|
Income tax effect of
non-GAAP adjustments
|
(0.17)
|
|
|
(0.09)
|
|
Impact of difference
in number of GAAP and non-GAAP diluted shares
|
(0.01)
|
|
|
—
|
|
Non-GAAP diluted net
income per share
|
$
|
0.12
|
|
|
$
|
0.22
|
|
Reconciliation of
GAAP Diluted Weighted-Average Number of Shares to Non-GAAP Diluted
Weighted-Average Number of Shares:
|
|
|
|
GAAP diluted
weighted-average number of shares
|
36,563
|
|
|
36,546
|
|
Dilutive impact due
to stock-based compensation
|
3,400
|
|
|
578
|
|
Non-GAAP diluted
weighted-average number of shares
|
39,963
|
|
|
37,124
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/gigamon-reports-first-quarter-2017-financial-results-300447497.html
SOURCE Gigamon Inc.