(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification Number) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Exhibit Number | Description | |
99.1 | ||
101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
104 | The cover page from Tenable's 8-K filed on July 30, 2019, formatted in Inline XBRL. |
TENABLE HOLDINGS, INC. | |||
Date: | July 30, 2019 | By: | /s/ Stephen A. Riddick |
Stephen A. Riddick | |||
General Counsel and Corporate Secretary |
• | Added 352 new enterprise platform customers and 44 net new six figure customers |
• | Revenue of $85.4 million, up 34% year-over-year |
• | GAAP net loss per share of $0.23; Pro forma non-GAAP net loss of $0.10, a 44% decrease year-over-year |
• | Revenue was $85.4 million, representing a 34% increase year-over-year. |
• | Calculated current billings was $98.1 million, representing a 27% increase year-over-year. |
• | GAAP loss from operations was $22.2 million, compared to a loss of $16.4 million in the second quarter of 2018. |
• | Non-GAAP loss from operations was $10.7 million, compared to a loss of $13.3 million in the second quarter of 2018. |
• | GAAP net loss was $21.6 million, compared to a loss of $17.2 million in the second quarter of 2018. |
• | GAAP net loss per share was $0.23, compared to a loss per share of $0.73 in the second quarter of 2018. |
• | Non-GAAP net loss was $10.0 million, compared to a loss of $14.0 million in the second quarter of 2018. |
• | Pro forma non-GAAP net loss per share was $0.10, compared to a loss per share of $0.18 in the second quarter of 2018. |
• | Cash and cash equivalents and short-term investments were $297.0 million at June 30, 2019, compared to $283.2 million at December 31, 2018. |
• | Net cash used in operating activities was $2.1 million, compared to $0.2 million provided by operating activities in the second quarter of 2018. Free cash flow was $(5.2) million, compared to $(1.1) million in the second quarter of 2018. Both net cash used in operating activities and free cash flow in the second quarter of 2019 included a $3.9 million benefit related to employee stock purchase plan activity. |
• | Added 352 new enterprise platform customers and 44 net new six figure customers. |
• | Unveiled new innovations to our Cyber Exposure analytics capabilities in Tenable Lumin™ at Edge 2019, our annual user conference. These innovations include a Cyber Exposure score, which is an objective measure of risk that combines data from Predictive Prioritization with asset criticality. Tenable also unveiled Cyber Exposure benchmarking and Remediation Workflow Guidance. |
• | Integrated Tenable.io® with Google Cloud Security Command Center. This integration provides organizations with enhanced visibility into their cloud assets, both public and private, delivered via a single dashboard. This builds on Tenable’s existing integrations with AWS, allowing customers to more effectively manage and reduce cyber risk across multiple public cloud environments. |
• | Launched Nessus® Essentials, an enhanced free version of our market-defining vulnerability assessment solution (formerly Nessus Home). Nessus Essentials is designed to train the next generation of cyber professionals. |
• | Tenable Research discovered several high-priority vulnerabilities, including exploits impacting vendors in the industrial controls/critical infrastructure, network controls and enterprise software spaces. |
• | Revenue in the range of $88.0 million to $89.0 million. |
• | Non-GAAP loss from operations in the range of $12.0 million to $11.0 million. |
• | Non-GAAP net loss in the range of $11.5 million to $10.5 million. |
• | Non-GAAP net loss per share in the range of $0.12 to $0.11, assuming 96.7 million weighted average shares outstanding. |
• | Revenue in the range of $346.0 million to $349.0 million. |
• | Calculated current billings in the range of $407.0 million to $417.0 million. |
• | Non-GAAP loss from operations in the range of $50.0 million to $48.0 million. |
• | Non-GAAP net loss in the range of $48.0 million to $46.0 million, assuming a provision for income taxes between $4.1 million and $3.7 million. |
• | Non-GAAP net loss per share in the range of $0.50 to $0.48, assuming 96.1 million weighted average shares outstanding. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(in thousands, except per share data) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Revenue | $ | 85,384 | $ | 63,592 | $ | 165,685 | $ | 122,699 | |||||||
Cost of revenue(1) | 13,918 | 9,879 | 27,144 | 18,607 | |||||||||||
Gross profit | 71,466 | 53,713 | 138,541 | 104,092 | |||||||||||
Operating expenses: | |||||||||||||||
Sales and marketing(1) | 56,015 | 41,826 | 108,704 | 81,414 | |||||||||||
Research and development(1) | 21,698 | 17,791 | 43,633 | 34,976 | |||||||||||
General and administrative(1) | 15,987 | 10,541 | 31,123 | 19,596 | |||||||||||
Total operating expenses | 93,700 | 70,158 | 183,460 | 135,986 | |||||||||||
Loss from operations | (22,234 | ) | (16,445 | ) | (44,919 | ) | (31,894 | ) | |||||||
Interest income (expense), net | 1,594 | (23 | ) | 3,150 | (49 | ) | |||||||||
Other expense, net | (122 | ) | (438 | ) | (336 | ) | (420 | ) | |||||||
Loss before income taxes | (20,762 | ) | (16,906 | ) | (42,105 | ) | (32,363 | ) | |||||||
Provision for income taxes | 866 | 244 | 963 | 675 | |||||||||||
Net loss | (21,628 | ) | (17,150 | ) | (43,068 | ) | (33,038 | ) | |||||||
Accretion of Series A and B redeemable convertible preferred stock | — | (191 | ) | — | (379 | ) | |||||||||
Net loss attributable to common stockholders | $ | (21,628 | ) | $ | (17,341 | ) | $ | (43,068 | ) | $ | (33,417 | ) | |||
Net loss per share attributable to common stockholders, basic and diluted | $ | (0.23 | ) | $ | (0.73 | ) | $ | (0.45 | ) | $ | (1.41 | ) | |||
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted | 95,820 | 23,750 | 94,785 | 23,623 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Cost of revenue | $ | 742 | $ | 114 | $ | 1,394 | $ | 191 | |||||||
Sales and marketing | 4,215 | 675 | 7,581 | 1,277 | |||||||||||
Research and development | 2,441 | 640 | 4,471 | 1,167 | |||||||||||
General and administrative | 3,975 | 1,595 | 7,246 | 2,788 | |||||||||||
Total stock-based compensation | $ | 11,373 | $ | 3,024 | $ | 20,692 | $ | 5,423 |
June 30, 2019 | December 31, 2018 | ||||||
(in thousands, except per share data) | (unaudited) | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 185,663 | $ | 165,116 | |||
Short-term investments | 111,301 | 118,119 | |||||
Accounts receivable (net of allowance for doubtful accounts of $125 and $188 at June 30, 2019 and December 31, 2018, respectively) | 68,983 | 68,261 | |||||
Deferred commissions | 24,867 | 23,272 | |||||
Prepaid expenses and other current assets | 20,316 | 22,020 | |||||
Total current assets | 411,130 | 396,788 | |||||
Property and equipment, net | 14,949 | 11,348 | |||||
Deferred commissions (net of current portion) | 36,999 | 36,162 | |||||
Operating lease right-of-use assets | 9,201 | 8,504 | |||||
Other assets | 8,490 | 7,810 | |||||
Total assets | $ | 480,769 | $ | 460,612 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 2,207 | $ | 171 | |||
Accrued expenses | 9,770 | 5,554 | |||||
Accrued compensation | 26,502 | 29,594 | |||||
Deferred revenue | 227,227 | 213,644 | |||||
Operating lease liabilities | 3,961 | 4,262 | |||||
Other current liabilities | 538 | 1,079 | |||||
Total current liabilities | 270,205 | 254,304 | |||||
Deferred revenue (net of current portion) | 80,106 | 76,259 | |||||
Operating lease liabilities (net of current portion) | 6,559 | 6,055 | |||||
Other liabilities | 2,940 | 2,231 | |||||
Total liabilities | 359,810 | 338,849 | |||||
Stockholders’ equity: | |||||||
Common stock (par value: $0.01; 500,000 shares authorized; 96,808 and 93,126 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively) | 968 | 931 | |||||
Additional paid-in capital | 629,087 | 586,940 | |||||
Accumulated other comprehensive income | 80 | — | |||||
Accumulated deficit | (509,176 | ) | (466,108 | ) | |||
Total stockholders’ equity | 120,959 | 121,763 | |||||
Total liabilities and stockholders’ equity | $ | 480,769 | $ | 460,612 |
Six Months Ended June 30, | |||||||
(in thousands) | 2019 | 2018 | |||||
Cash flows from operating activities: | |||||||
Net loss | $ | (43,068 | ) | $ | (33,038 | ) | |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
Depreciation and amortization | 3,089 | 2,994 | |||||
Stock-based compensation | 20,692 | 5,423 | |||||
Other | (1,022 | ) | 664 | ||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (658 | ) | 850 | ||||
Prepaid expenses and other current assets | 1,673 | 2,339 | |||||
Deferred commissions | (2,432 | ) | (629 | ) | |||
Other assets | (1,209 | ) | 1,195 | ||||
Accounts payable and accrued expenses | 5,646 | 2,326 | |||||
Accrued compensation | (3,092 | ) | (2,620 | ) | |||
Deferred revenue | 17,430 | 21,319 | |||||
Other current liabilities | (487 | ) | (30 | ) | |||
Other liabilities | 441 | (47 | ) | ||||
Net cash (used in) provided by operating activities | (2,997 | ) | 746 | ||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (5,335 | ) | (2,978 | ) | |||
Purchases of short-term investments | (102,453 | ) | — | ||||
Sales and maturities of short-term investments | 110,750 | — | |||||
Net cash provided by (used in) investing activities | 2,962 | (2,978 | ) | ||||
Cash flows from financing activities: | |||||||
Principal payments under finance lease obligations | (8 | ) | (252 | ) | |||
Payments of deferred offering costs | — | (1,515 | ) | ||||
Proceeds from stock issued in connection with the employee stock purchase plan | 8,579 | — | |||||
Proceeds from the exercise of stock options | 12,727 | 1,010 | |||||
Repurchases of common stock | — | (75 | ) | ||||
Net cash provided by (used in) financing activities | 21,298 | (832 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (716 | ) | (491 | ) | |||
Net increase (decrease) in cash and cash equivalents and restricted cash | 20,547 | (3,555 | ) | ||||
Cash and cash equivalents and restricted cash at beginning of period | 165,378 | 27,472 | |||||
Cash and cash equivalents and restricted cash at end of period | $ | 185,925 | $ | 23,917 |
Revenue | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Subscription revenue | $ | 69,370 | $ | 48,725 | $ | 134,107 | $ | 93,057 | |||||||
Perpetual license and maintenance revenue | 13,553 | 13,412 | 27,080 | 26,889 | |||||||||||
Professional services and other revenue | 2,461 | 1,455 | 4,498 | 2,753 | |||||||||||
Revenue(1) | $ | 85,384 | $ | 63,592 | $ | 165,685 | $ | 122,699 |
Calculated Current Billings | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Revenue | $ | 85,384 | $ | 63,592 | $ | 165,685 | $ | 122,699 | |||||||
Add: Deferred revenue (current), end of period | 227,227 | 174,277 | 227,227 | 174,277 | |||||||||||
Less: Deferred revenue (current), beginning of period | (214,508 | ) | (160,503 | ) | (213,644 | ) | (154,898 | ) | |||||||
Calculated current billings | $ | 98,103 | $ | 77,366 | $ | 179,268 | $ | 142,078 |
Free Cash Flow | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Net cash (used in) provided by operating activities | $ | (2,123 | ) | $ | 242 | $ | (2,997 | ) | $ | 746 | |||||
Purchases of property and equipment | (3,029 | ) | (1,382 | ) | (5,335 | ) | (2,978 | ) | |||||||
Free cash flow(1) | $ | (5,152 | ) | $ | (1,140 | ) | $ | (8,332 | ) | $ | (2,232 | ) |
Non-GAAP Loss from Operations and Non-GAAP Operating Margin | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Loss from operations | $ | (22,234 | ) | $ | (16,445 | ) | $ | (44,919 | ) | $ | (31,894 | ) | |||
Stock-based compensation | 11,373 | 3,024 | 20,692 | 5,423 | |||||||||||
Amortization of intangible assets | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP loss from operations | $ | (10,710 | ) | $ | (13,270 | ) | $ | (23,925 | ) | $ | (26,169 | ) | |||
Operating margin | (26 | )% | (26 | )% | (27 | )% | (26 | )% | |||||||
Non-GAAP operating margin | (13 | )% | (21 | )% | (14 | )% | (21 | )% |
Non-GAAP Net Loss, Non-GAAP Net Loss Per Share and Pro forma Non-GAAP Net Loss Per Share | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(in thousands, except per share data) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Net loss attributable to common stockholders | $ | (21,628 | ) | $ | (17,341 | ) | $ | (43,068 | ) | $ | (33,417 | ) | |||
Accretion of Series A and B redeemable convertible preferred stock | — | 191 | — | 379 | |||||||||||
Stock-based compensation | 11,373 | 3,024 | 20,692 | 5,423 | |||||||||||
Tax impact of stock-based compensation(1) | 121 | (25 | ) | (528 | ) | (48 | ) | ||||||||
Amortization of intangible assets(1) | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP net loss | $ | (9,983 | ) | $ | (14,000 | ) | $ | (22,602 | ) | $ | (27,361 | ) | |||
Net loss per share attributable to common stockholders, basic and diluted | $ | (0.23 | ) | $ | (0.73 | ) | $ | (0.45 | ) | $ | (1.41 | ) | |||
Accretion of Series A and B redeemable convertible preferred stock | — | 0.01 | — | 0.02 | |||||||||||
Stock-based compensation | 0.13 | 0.12 | 0.22 | 0.22 | |||||||||||
Tax impact of stock-based compensation(1) | — | — | (0.01 | ) | — | ||||||||||
Amortization of intangible assets(1) | — | 0.01 | — | 0.01 | |||||||||||
Non-GAAP net loss per share, basic and diluted | $ | (0.10 | ) | $ | (0.59 | ) | $ | (0.24 | ) | $ | (1.16 | ) | |||
Weighted-average shares used to compute net loss per share attributable to common stockholders and non-GAAP net loss per share, basic and diluted | 95,820 | 23,750 | 94,785 | 23,623 | |||||||||||
Pro forma adjustment to reflect the assumed conversion of our convertible redeemable preferred stock as of the beginning of the period | — | 55,386 | — | 55,386 | |||||||||||
Weighted-average shares used to compute pro forma non-GAAP net loss per share, basic and diluted | 95,820 | 79,136 | 94,785 | 79,009 | |||||||||||
Pro forma non-GAAP net loss per share, basic and diluted | $ | (0.10 | ) | $ | (0.18 | ) | $ | (0.24 | ) | $ | (0.35 | ) |
Non-GAAP Gross Profit and Non-GAAP Gross Margin | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Gross profit | $ | 71,466 | $ | 53,713 | $ | 138,541 | $ | 104,092 | |||||||
Stock-based compensation | 742 | 114 | 1,394 | 191 | |||||||||||
Amortization of intangible assets | 151 | 151 | 302 | 302 | |||||||||||
Non-GAAP gross profit | $ | 72,359 | $ | 53,978 | $ | 140,237 | $ | 104,585 | |||||||
Gross margin | 84 | % | 84 | % | 84 | % | 85 | % | |||||||
Non-GAAP gross margin | 85 | % | 85 | % | 85 | % | 85 | % |
Non-GAAP Sales and Marketing Expense | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Sales and marketing expense | $ | 56,015 | $ | 41,826 | $ | 108,704 | $ | 81,414 | |||||||
Less: Stock-based compensation | 4,215 | 675 | 7,581 | 1,277 | |||||||||||
Non-GAAP sales and marketing expense | $ | 51,800 | $ | 41,151 | $ | 101,123 | $ | 80,137 | |||||||
Non-GAAP sales and marketing expense % of revenue | 61 | % | 65 | % | 61 | % | 65 | % |
Non-GAAP Research and Development Expense | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Research and development expense | $ | 21,698 | $ | 17,791 | $ | 43,633 | $ | 34,976 | |||||||
Less: Stock-based compensation | 2,441 | 640 | 4,471 | 1,167 | |||||||||||
Non-GAAP research and development expense | $ | 19,257 | $ | 17,151 | $ | 39,162 | $ | 33,809 | |||||||
Non-GAAP research and development expense % of revenue | 23 | % | 27 | % | 24 | % | 28 | % |
Non-GAAP General and Administrative Expense | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
(dollars in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
General and administrative expense | $ | 15,987 | $ | 10,541 | $ | 31,123 | $ | 19,596 | |||||||
Less: Stock-based compensation | 3,975 | 1,595 | 7,246 | 2,788 | |||||||||||
Non-GAAP general and administrative expense | $ | 12,012 | $ | 8,946 | $ | 23,877 | $ | 16,808 | |||||||
Non-GAAP general and administrative expense % of revenue | 14 | % | 14 | % | 14 | % | 14 | % |
Forecasted Non-GAAP Loss from Operations | Three Months Ending September 30, 2019 | Year Ending December 31, 2019 | |||||||||||||
(in millions) | Low | High | Low | High | |||||||||||
Forecasted loss from operations | $ | (22.6 | ) | $ | (21.6 | ) | $ | (92.0 | ) | $ | (90.0 | ) | |||
Forecasted stock-based compensation | 10.5 | 10.5 | 41.6 | 41.6 | |||||||||||
Forecasted amortization of intangible assets | 0.1 | 0.1 | 0.4 | 0.4 | |||||||||||
Forecasted non-GAAP loss from operations | $ | (12.0 | ) | $ | (11.0 | ) | $ | (50.0 | ) | $ | (48.0 | ) |
Forecasted Non-GAAP Net Loss and Non-GAAP Net Loss Per Share | Three Months Ending September 30, 2019 | Year Ending December 31, 2019 | |||||||||||||
(in millions, except per share data) | Low | High | Low | High | |||||||||||
Forecasted net loss | $ | (22.1 | ) | $ | (21.1 | ) | $ | (90.0 | ) | $ | (88.0 | ) | |||
Forecasted stock-based compensation(1) | 10.5 | 10.5 | 41.6 | 41.6 | |||||||||||
Forecasted amortization of intangible assets | 0.1 | 0.1 | 0.4 | 0.4 | |||||||||||
Forecasted non-GAAP net loss | $ | (11.5 | ) | $ | (10.5 | ) | $ | (48.0 | ) | $ | (46.0 | ) | |||
Forecasted net loss per share, basic and diluted | $ | (0.23 | ) | $ | (0.22 | ) | $ | (0.94 | ) | $ | (0.92 | ) | |||
Forecasted stock-based compensation(1) | 0.11 | 0.11 | 0.44 | 0.44 | |||||||||||
Forecasted amortization of intangible assets | — | — | — | — | |||||||||||
Forecasted Non-GAAP net loss per share, basic and diluted | $ | (0.12 | ) | $ | (0.11 | ) | $ | (0.50 | ) | $ | (0.48 | ) | |||
Forecasted weighted-average shares used to compute net loss per share, basic and diluted | 96.7 | 96.7 | 96.1 | 96.1 |