Boston, July 23, 2015 – LogMeIn, Inc. (NASDAQ: LOGM), a leading provider of cloud based connectivity, today announced its results for the second quarter ended June 30, 2015.
Second quarter 2015 highlights include:
- Revenue was $64.8 million, up 18% compared with the second quarter of 2014
- Adjusted EBITDA was $14.6 million and adjusted EBITDA margin was 22.6%, versus $11.5 million and 20.8% in the second quarter of 2014
- Non-GAAP net income was $9.1 million, or $0.35 per diluted share, as compared to $7.3 million, or $0.29 per diluted share, in the second quarter of 2014
- GAAP net income was $2.4 million, or $0.09 per diluted share, as compared to GAAP net income of $1.3 million, or $0.05 per diluted share, in the second quarter of 2014
- Non-GAAP cash flow from operations was $22.4 million and 35% of revenue in the second quarter of 2015
- Total deferred revenue was $136.0 million, up 26% year-over-year
- The Company closed the quarter with cash, cash equivalents, and short-term investments of $236.5 million
“We’re pleased to report another very good quarter, with revenue and earnings that exceeded the high-end of our guidance while generating particularly strong cash flow,” said Michael Simon, CEO and Chairman of LogMeIn. “Our Collaboration, IT Management and Service Cloud businesses all performed well, and we believe we made significant progress on join.me and Xively, our key strategic growth initiatives. As a result, we are raising our guidance for both revenue and earnings per share.”
Based on information available as of July 23, 2015, the Company is issuing guidance for the third quarter 2015 and fiscal year 2015.
Third Quarter 2015: The Company expects third quarter revenue to be in the range of $68.8 million to $69.3 million.
Adjusted EBITDA is expected to be in the range of $18.0 million to $18.5 million.
Non-GAAP net income is expected to be in the range of $11.0 million to $11.3 million, or $0.43 to $0.44 per diluted share. Non-GAAP net income excludes an estimated $7.9 million in stock-based compensation expense, $500,000 in litigation related expense, and $1.9 million in acquisition related costs and amortization.
Non-GAAP net income for the third quarter assumes an effective tax rate of approximately 30%. Non-GAAP net income per diluted share for the third quarter of 2015 is based on an estimated 25.7 million fully-diluted weighted average shares outstanding.
Including stock-based compensation expense, litigation related expense, and acquisition related costs and amortization, we expect to report GAAP net income in the range of $4.5 million to $5.0 million, or $0.18 to $0.19 per share.
GAAP net income for the third quarter assumes an effective tax rate of approximately 15%. GAAP net income per share for the third quarter of 2015 is based on an estimated 25.7 million weighted average shares outstanding.
Fiscal year 2015: The Company expects full year 2015 revenue to be in the range of $265.0 million to $266.5 million.
Adjusted EBITDA is expected to be in the range of $63.0 million to $65.0 million.
Non-GAAP net income is expected to be in the range of $38.9 million to $40.4 million, or $1.51 to $1.57 per diluted share. Non-GAAP net income excludes an estimated $28.7 million in stock compensation expense, $5.7 million in litigation related expense, and $8.1 million in acquisition related costs and amortization.
Non-GAAP net income for the full fiscal year 2015 assumes an effective tax rate of approximately 30%. Non-GAAP net income per diluted share for 2015 is based on an estimated 25.7 million fully-diluted weighted average shares outstanding.
Including stock compensation expense, litigation related expense, and acquisition related costs and amortization, we expect to report GAAP net income in the range of $11.1 million to $12.9 million, or $0.43 to $0.50 per diluted share.
GAAP net income for the full year assumes an effective tax rate of 15%. GAAP net income per share for 2015 is based on an estimated 25.7 million weighted average shares outstanding.
A reconciliation of the most comparable GAAP financial measures to non-GAAP measures used above is included in the tables attached to this release.
Conference Call Information for Today, Thursday, July 23, 2015
The Company will host a corresponding conference call and live webcast at 5:00 p.m. Eastern Time today. To access the conference call, dial 888-452-4023 (for the U.S. and Canada) or 719-325-2393 (for international callers) and enter conference ID 5298156. A live webcast will be available on the Investor Relations section of the Company’s corporate website at www.LogMeInInc.com and via replay beginning approximately two hours after the completion of the call until the Company’s announcement of its financial results for the next quarter. An audio replay of the call will also be available to investors beginning at approximately 8:00 p.m. Eastern Time on July 23, 2015 until 8:00 p.m. Eastern Time on July 31, 2015, by dialing 888-203-1112 (and entering passcode 5298156).
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures including adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP income before provision for income taxes, non-GAAP provision for income taxes, non-GAAP net income, non-GAAP net income per diluted share and non-GAAP cash flow from operations.
Adjusted EBITDA is GAAP net income excluding income tax (benefit) expense, interest income, and other income, net, depreciation and amortization, acquisition related costs, stock-based compensation expense, and litigation related expense. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue. Non-GAAP operating income excludes acquisition related costs and amortization, stock-based compensation expense, and litigation related expense. Non-GAAP provision for income taxes excludes the tax impact of acquisition related costs and amortization, stock-based compensation expense, and litigation related expense. Non-GAAP net income and non-GAAP net income per diluted share exclude acquisition related costs and amortization, stock-based compensation expense, and litigation related expense. Non-GAAP cash flow from operations excludes payments and receipts related to litigation related costs, and acquisition related payments.
The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures. The Company believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods and uses these measures in financial reports prepared for management and the Company’s board of directors. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software-as-a-service companies, many of which present similar non-GAAP financial measures to investors. The Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant elements that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management in determining these non-GAAP financial measures. In order to compensate for these limitations, management of the Company presents its non-GAAP financial measures in connection with its GAAP results. The Company urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.
Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures used in this press release are included in this release.
About LogMeIn, Inc.
LogMeIn, Inc. (NASDAQ:LOGM) simplifies how people connect to each other and the world around them. With millions of users worldwide, our cloud-based solutions make it possible for people and companies to connect and engage with their workplace, colleagues, customers and products anywhere, anytime. LogMeIn is headquartered in Boston with offices in Bangalore, Budapest, Dublin, London, San Francisco and Sydney.
Cautionary Language Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the popularity, value and effectiveness of the Company’s products and services, progress regarding the Company’s key strategic growth initiatives, and the Company’s financial guidance for fiscal year 2015 and the third quarter of 2015. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond the Company’s control. The Company’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, dependence on the software market and the specific markets the Company’s products participate in, customer adoption of the Company’s solutions, the Company’s ability to attract new customers and retain existing customers, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which the Company operates, the inherent risks and uncertainties of pending or future litigation, the security of the Company’s confidential information and the confidential information of the Company’s customers, the Company’s ability to continue to promote and maintain its brand in a cost-effective manner, the Company’s ability to compete effectively, the Company’s ability to develop and introduce new products and add-ons or enhancements to existing products, the Company’s ability to manage growth, the Company’s ability to attract and retain key personnel, the Company’s ability to protect its intellectual property and other proprietary rights, and other risks detailed in the Company’s other publicly available filings with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent the Company’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. The Company undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.
LogMeIn, LogMeIn Central, LogMeIn Pro, LogMeIn Rescue, join.me, Cubby, AppGuru, Xively, Meldium and BoldChat are trademarks or registered trademarks of LogMeIn in the US and other countries around the world.