Delaware | 001-38600 | 47-5580846 |
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification Number) |
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)) |
Exhibit Number | Description | |
99.1 |
TENABLE HOLDINGS, INC. | |||
Date: | September 5, 2018 | By: | /s/ Stephen A. Riddick |
Stephen A. Riddick | |||
General Counsel and Corporate Secretary |
• | Revenue of $63.6 million, up 44% year-over-year |
• | Calculated current billings of $77.4 million, up 39% year-over-year |
• | Added 282 new logo enterprise platform customers, up 30% year-over-year |
• | Raised $265 million of net proceeds in initial public offering in July |
• | Revenue of $63.6 million represented a 44% increase year-over-year. |
• | Calculated current billings was $77.4 million representing a 39% increase year-over-year. |
• | GAAP loss from operations was $16.4 million, compared to a loss of $9.2 million in the second quarter of 2017. |
• | Non-GAAP loss from operations was $13.3 million, compared to a loss of $7.2 million in the second quarter of 2017. |
• | GAAP net loss per share was $0.73, compared to GAAP net loss per share of $0.43 in the second quarter of 2017. |
• | Pro forma non-GAAP net loss per share, which gives effect to the conversion of outstanding preferred common stock as of the beginning of the period, was $0.18, compared to pro forma non-GAAP loss per share of $0.09 in the second quarter of 2017. |
• | Cash and cash equivalents was $23.7 million as of June 30, 2018. Our initial public offering in July generated net proceeds of $265 million, net of underwriting discounts and commissions and offering expenses. |
• | Net cash provided by operating activities was $0.2 million, compared to net cash used of $(1.0) million in the second quarter of 2017. |
• | Free cash flow was $(1.1) million, compared to $(1.2) million in the second quarter of 2017. |
• | Announced the industry’s first solution designed to reduce cybersecurity risk across today’s converged IT/Operational Technology ("OT") environments, including enhancements to Tenable.io® and our Industrial Security offering, that is delivered in partnership with Siemens. |
• | Added 282 new logo enterprise platform customers, up 30% year-over-year, and added 33 net new six figure annual recurring revenue customers to reach over 340 in total. |
• | Tenable Research discovered a new vulnerability in critical infrastructure at a time when OT systems have become high-value targets for cybercriminals around the world. |
• | Unveiled original research citing that cybercriminals have a seven-day window of opportunity to exploit a vulnerability before security teams launch initial assessments for the new vulnerability. This lag time further highlights the criticality of measuring and managing Cyber Exposure to eliminate the attackers' advantage. |
• | Tenable.io won best vulnerability management solution at the 2018 SC Awards Europe. |
• | Revenue in the range of $66.0 million to $66.5 million. |
• | Non-GAAP loss from operations in the range of $17.5 million to $16.5 million. |
• | Non-GAAP net loss in the range of $17.1 million to $16.1 million. |
• | Pro forma non-GAAP net loss per share in the range of $0.19 to $0.18, assuming 88.7 million weighted average shares outstanding. |
• | Revenue in the range of $260.0 million to $261.0 million. |
• | Calculated current billings in the range of $314.0 million to $316.0 million. |
• | Non-GAAP loss from operations in the range of $60.7 million to $58.7 million. |
• | Non-GAAP net loss in the range of $61.2 million to $59.2 million. |
• | Pro forma non-GAAP net loss per share in the range of $0.72 to $0.70, assuming 84.8 million weighted average shares outstanding. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(in thousands, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Revenue | $ | 63,592 | $ | 44,149 | $ | 122,699 | $ | 84,630 | |||||||
Cost of revenue(1) | 9,879 | 5,348 | 18,607 | 9,786 | |||||||||||
Gross profit | 53,713 | 38,801 | 104,092 | 74,844 | |||||||||||
Operating expenses: | |||||||||||||||
Sales and marketing(1) | 41,826 | 27,773 | 81,414 | 53,941 | |||||||||||
Research and development(1) | 17,791 | 13,713 | 34,976 | 26,171 | |||||||||||
General and administrative(1) | 10,541 | 6,544 | 19,596 | 12,707 | |||||||||||
Total operating expenses | 70,158 | 48,030 | 135,986 | 92,819 | |||||||||||
Loss from operations | (16,445 | ) | (9,229 | ) | (31,894 | ) | (17,975 | ) | |||||||
Other (expense) income, net | (461 | ) | 56 | (469 | ) | 27 | |||||||||
Loss before income taxes | (16,906 | ) | (9,173 | ) | (32,363 | ) | (17,948 | ) | |||||||
Provision for income taxes | 244 | 41 | 675 | 92 | |||||||||||
Net loss and comprehensive loss | (17,150 | ) | (9,214 | ) | (33,038 | ) | (18,040 | ) | |||||||
Accretion of Series A and B redeemable convertible preferred stock | (191 | ) | (191 | ) | (379 | ) | (378 | ) | |||||||
Net loss attributable to common stockholders | $ | (17,341 | ) | $ | (9,405 | ) | $ | (33,417 | ) | $ | (18,418 | ) | |||
Net loss per share attributable to common stockholders, basic and diluted | $ | (0.73 | ) | $ | (0.43 | ) | $ | (1.41 | ) | $ | (0.85 | ) | |||
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted | 23,750 | 22,060 | 23,623 | 21,661 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Cost of revenue | $ | 114 | $ | 50 | $ | 191 | $ | 104 | |||||||
Sales and marketing | 675 | 358 | 1,277 | 628 | |||||||||||
Research and development | 640 | 452 | 1,167 | 846 | |||||||||||
General and administrative | 1,595 | 989 | 2,788 | 1,897 | |||||||||||
Total stock-based compensation | $ | 3,024 | $ | 1,849 | $ | 5,423 | $ | 3,475 |
June 30, 2018 | December 31, 2017 | ||||||
(in thousands, except per share data) | (unaudited) | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 23,655 | $ | 27,210 | |||
Accounts receivable (net of allowance for doubtful accounts of $261 and $160 at June 30, 2018 and December 31, 2017, respectively) | 49,930 | 50,881 | |||||
Deferred commissions | 19,078 | 17,170 | |||||
Prepaid expenses and other current assets | 13,324 | 15,994 | |||||
Total current assets | 105,987 | 111,255 | |||||
Property and equipment, net | 11,240 | 10,754 | |||||
Construction in progress | 12,253 | 2,252 | |||||
Deferred commissions (net of current portion) | 31,727 | 33,006 | |||||
Intangible assets, net | 729 | 1,031 | |||||
Goodwill | 265 | 265 | |||||
Other assets | 7,157 | 5,774 | |||||
Total assets | $ | 169,358 | $ | 164,337 | |||
Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Deficit | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 1,457 | $ | 338 | |||
Accrued expenses | 7,462 | 4,878 | |||||
Accrued compensation | 15,862 | 18,482 | |||||
Deferred revenue | 174,277 | 154,898 | |||||
Other current liabilities | 1,932 | 1,750 | |||||
Total current liabilities | 200,990 | 180,346 | |||||
Deferred revenue (net of current portion) | 72,860 | 70,920 | |||||
Financing obligation | 11,803 | 1,802 | |||||
Other liabilities | 4,315 | 5,199 | |||||
Total liabilities | 289,968 | 258,267 | |||||
Redeemable convertible Series A preferred stock (par value: $0.01; 15,848 shares authorized, issued, and outstanding with liquidation preference of $50,000 at June 30, 2018 and December 31, 2017) | 49,946 | 49,935 | |||||
Redeemable convertible Series B preferred stock (par value: $0.01; 42,000 shares authorized, 39,538 issued and outstanding with liquidation preference of $230,008 at June 30, 2018 and December 31, 2017) | 228,168 | 227,800 | |||||
Stockholders’ deficit: | |||||||
Common stock (par value: $0.01; 93,848 and 93,855 shares authorized at June 30, 2018 and December 31, 2017; 24,951 and 24,472 shares issued and outstanding at June 30, 2018 and December 31, 2017) | 250 | 246 | |||||
Additional paid-in capital | 26,651 | 20,676 | |||||
Accumulated deficit | (425,625 | ) | (392,587 | ) | |||
Total stockholders’ deficit | (398,724 | ) | (371,665 | ) | |||
Total liabilities, redeemable convertible preferred stock and stockholders’ deficit | $ | 169,358 | $ | 164,337 |
Six Months Ended June 30, | |||||||
(in thousands) | 2018 | 2017 | |||||
Cash flows from operating activities: | |||||||
Net loss | $ | (33,038 | ) | $ | (18,040 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation and amortization | 2,994 | 2,121 | |||||
Stock-based compensation | 5,423 | 3,475 | |||||
Deferred income taxes | — | 318 | |||||
Other | 664 | (39 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 850 | (1,205 | ) | ||||
Prepaid expenses and other current assets | 2,625 | (205 | ) | ||||
Deferred commissions | (629 | ) | (6,134 | ) | |||
Other assets | 1,260 | 219 | |||||
Accounts payable and accrued expenses | 2,326 | 1,846 | |||||
Accrued compensation | (2,620 | ) | (878 | ) | |||
Deferred revenue | 21,319 | 19,468 | |||||
Other current liabilities | (3 | ) | (517 | ) | |||
Other liabilities | (425 | ) | (261 | ) | |||
Net cash provided by operating activities | 746 | 168 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (2,978 | ) | (681 | ) | |||
Net cash used in investing activities | (2,978 | ) | (681 | ) | |||
Cash flows from financing activities: | |||||||
Principal payments under capital lease obligations | (252 | ) | (90 | ) | |||
Credit facility issuance costs | — | (238 | ) | ||||
Payments of deferred offering costs | (1,515 | ) | — | ||||
Proceeds from the exercise of stock options | 1,010 | 2,467 | |||||
Repurchases of common stock | (75 | ) | (385 | ) | |||
Net cash (used in) provided by financing activities | (832 | ) | 1,754 | ||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (491 | ) | 45 | ||||
Net (decrease) increase in cash and cash equivalents and restricted cash | (3,555 | ) | 1,286 | ||||
Cash and cash equivalents and restricted cash at beginning of period | 27,472 | 34,470 | |||||
Cash and cash equivalents and restricted cash at end of period | $ | 23,917 | $ | 35,756 |
Non-GAAP Loss from Operations and Non-GAAP Operating Margin | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Loss from operations | $ | (16,445 | ) | $ | (9,229 | ) | $ | (31,894 | ) | $ | (17,975 | ) | |||
Stock-based compensation | 3,024 | 1,849 | 5,423 | 3,475 | |||||||||||
Amortization of intangible assets | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP loss from operations | $ | (13,270 | ) | $ | (7,229 | ) | $ | (26,169 | ) | $ | (14,198 | ) | |||
Operating margin | (26 | )% | (21 | )% | (26 | )% | (21 | )% | |||||||
Non-GAAP operating margin | (21 | )% | (16 | )% | (21 | )% | (17 | )% |
Non-GAAP Net Loss, Non-GAAP Net Loss Per Share and Pro forma Non-GAAP Loss Per Share | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net loss attributable to common stockholders | $ | (17,341 | ) | $ | (9,405 | ) | $ | (33,417 | ) | $ | (18,418 | ) | |||
Accretion of Series A and B redeemable convertible preferred stock | 191 | 191 | 379 | 378 | |||||||||||
Stock-based compensation | 3,024 | 1,849 | 5,423 | 3,475 | |||||||||||
Tax impact of stock-based compensation(1) | (25 | ) | (12 | ) | (48 | ) | (22 | ) | |||||||
Amortization of intangible assets(1) | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP net loss | $ | (14,000 | ) | $ | (7,226 | ) | $ | (27,361 | ) | $ | (14,285 | ) | |||
Net loss per share attributable to common stockholders, basic and diluted | $ | (0.73 | ) | $ | (0.43 | ) | $ | (1.41 | ) | $ | (0.85 | ) | |||
Accretion of Series A and B redeemable convertible preferred stock | 0.01 | 0.01 | 0.02 | 0.02 | |||||||||||
Stock-based compensation | 0.12 | 0.08 | 0.22 | 0.16 | |||||||||||
Tax impact of stock-based compensation(1) | — | — | — | — | |||||||||||
Amortization of intangible assets(1) | 0.01 | 0.01 | 0.01 | 0.01 | |||||||||||
Non-GAAP net loss per share, basic and diluted | $ | (0.59 | ) | $ | (0.33 | ) | $ | (1.16 | ) | $ | (0.66 | ) | |||
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted | 23,750 | 22,060 | 23,623 | 21,661 | |||||||||||
Pro forma adjustment to reflect assumed conversion of our convertible redeemable preferred stock as of the beginning of the period | 55,386 | 55,386 | 55,386 | 55,386 | |||||||||||
Weighted-average shares used to compute pro forma non-GAAP net loss per share, basic and diluted | 79,136 | 77,446 | 79,009 | 77,047 | |||||||||||
Pro forma non-GAAP net loss per share | $ | (0.18 | ) | $ | (0.09 | ) | $ | (0.35 | ) | $ | (0.19 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Calculated Current Billings | 2018 | 2017 | 2018 | 2017 | |||||||||||
Revenue | $ | 63,592 | $ | 44,149 | $ | 122,699 | $ | 84,630 | |||||||
Deferred revenue (current), end of period | 174,277 | 122,190 | 174,277 | 122,190 | |||||||||||
Deferred revenue (current), beginning of period(1) | (160,503 | ) | (110,605 | ) | (154,898 | ) | (107,006 | ) | |||||||
Calculated current billings | $ | 77,366 | $ | 55,734 | $ | 142,078 | $ | 99,814 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Free Cash Flow | 2018 | 2017 | 2018 | 2017 | |||||||||||
Net cash provided by (used in) operating activities | $ | 242 | $ | (1,019 | ) | $ | 746 | $ | 168 | ||||||
Purchases of property and equipment | (1,382 | ) | (221 | ) | (2,978 | ) | (681 | ) | |||||||
Free cash flow | $ | (1,140 | ) | $ | (1,240 | ) | $ | (2,232 | ) | $ | (513 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Non-GAAP Gross Profit and Non-GAAP Gross Margin | 2018 | 2017 | 2018 | 2017 | |||||||||||
Gross profit | $ | 53,713 | $ | 38,801 | $ | 104,092 | $ | 74,844 | |||||||
Stock-based compensation | 114 | 50 | 191 | 104 | |||||||||||
Amortization of intangible assets | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP gross profit | $ | 53,978 | $ | 39,002 | $ | 104,585 | $ | 75,250 | |||||||
Gross margin | 84 | % | 88 | % | 85 | % | 88 | % | |||||||
Non-GAAP gross margin | 85 | % | 88 | % | 85 | % | 89 | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Non-GAAP Sales and Marketing Expense | 2018 | 2017 | 2018 | 2017 | |||||||||||
Sales and marketing expense | $ | 41,826 | $ | 27,773 | $ | 81,414 | $ | 53,941 | |||||||
Less: Stock-based compensation | 675 | 358 | 1,277 | 628 | |||||||||||
Non-GAAP sales and marketing expense | $ | 41,151 | $ | 27,415 | $ | 80,137 | $ | 53,313 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Non-GAAP Research and Development Expense | 2018 | 2017 | 2018 | 2017 | |||||||||||
Research and development expense | $ | 17,791 | $ | 13,713 | $ | 34,976 | $ | 26,171 | |||||||
Less: Stock-based compensation | 640 | 452 | 1,167 | 846 | |||||||||||
Non-GAAP research and development expense | $ | 17,151 | $ | 13,261 | $ | 33,809 | $ | 25,325 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Non-GAAP General and Administrative Expense | 2018 | 2017 | 2018 | 2017 | |||||||||||
General and administrative expense | $ | 10,541 | $ | 6,544 | $ | 19,596 | $ | 12,707 | |||||||
Less: Stock-based compensation | 1,595 | 989 | 2,788 | 1,897 | |||||||||||
Non-GAAP general and administrative expense | $ | 8,946 | $ | 5,555 | $ | 16,808 | $ | 10,810 |