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(State or other jurisdiction of
incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.) |
Title of each class |
Trading symbol(s) |
Name of each exchange on which registered |
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Exhibit | |||
Number
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Description
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NUTANIX, INC.
|
|||
Date:
|
February 24, 2021
|
By:
|
/s/ Duston M. Williams
|
Duston M. Williams
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|||
Chief Financial Officer
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Exhibit 99.1
|
Delivers Record ACV Billings, Exceeds Guidance Across all Metrics
Continues Momentum with Run-rate ACV up 28% YoY, Bolstered by Over 100% YoY Growth in Emerging Product New ACV 5
SAN JOSE, Calif.--(BUSINESS WIRE)--February 24, 2021--Nutanix, Inc. (NASDAQ: NTNX), a leader in private cloud, hybrid and multicloud computing, today announced financial results for its second quarter ended January 31, 2021.
“We delivered a strong quarter across the board, exceeding guidance on all metrics and continuing our momentum with key customer wins and solid execution,” said Rajiv Ramaswami, President and CEO of Nutanix. “In my first two months as CEO of Nutanix, my conviction that we have a talented employee base, loyal customers who love the simplicity of our software, and a strong market opportunity ahead of us has only been reinforced.”
“We delivered record ACV billings with growth of 14 percent year-over-year, bolstered by the strength of our emerging products,” said Duston Williams, CFO of Nutanix. “We continued to make progress on our transition to subscription and maintained our disciplined approach to managing operating expenses, which were lower than expected this quarter. We look forward to continuing to execute on our transformation and are confident Nutanix is well positioned for long-term value creation.”
Second Quarter Fiscal 2021 Financial Summary
|
|
Q2 FY’21 |
|
Q2 FY’20 |
|
Y/Y Change |
Annual Contract Value (ACV)1 Billings |
|
$159.2 million |
|
$139.5 million |
|
14% |
Run-rate Annual Contract Value (ACV)2 |
|
$1.38 billion |
|
$1.08 billion |
|
28% |
Total Average Contract Term3 |
|
3.4 years |
|
3.9 years |
|
(0.5) years |
Total Revenue4 |
|
$346.4 million |
|
$346.8 million |
|
Flat |
GAAP Gross Margin |
|
79.5% |
|
78.3% |
|
120 bps |
Non-GAAP Gross Margin |
|
82.7% |
|
81.4% |
|
130 bps |
GAAP Operating Expenses |
|
$431.7 million |
|
$478.6 million |
|
(10)% |
Non-GAAP Operating Expenses |
|
$353.5 million |
|
$396.3 million |
|
(11)% |
Free Cash Flow |
|
$(28.5) million |
|
$(73.7) million |
|
$45.2 million |
Reconciliations between GAAP and non-GAAP financial measures and key performance measures are provided in the tables of this press release.
Recent Company Highlights
Third Quarter Fiscal 2021 Outlook
|
|
|
ACV Billings |
$150 - $155 million |
|
Non-GAAP Gross Margin |
Approximately 81% |
|
Non-GAAP Operating Expenses |
$365 - $370 million |
|
Weighted Average Shares Outstanding |
Approximately 207 million |
Supplementary materials to this press release, including our second quarter fiscal year 2021 earnings presentation, can be found at https://ir.nutanix.com/company/financial.
Webcast and Conference Call Information
Nutanix executives will discuss the company’s second quarter fiscal 2021 financial results on a conference call at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time. To listen to the call via telephone, dial 1-833-227-5841 from within the United States or 1-647-689-4068 from outside the United States. The conference ID is 4194788. This call will be webcast live and available to all interested parties on our Investor Relations website at ir.nutanix.com. Shortly after the conclusion of the conference call, a replay of the audio webcast will be available on our Investor Relations website. A telephonic replay will be available for one week and can be accessed by calling 1-800-585-8367 or 1-416-621-4642, and entering the conference ID 4194788.
Definitions and Total Revenue Impact
1Annual Contract Value, or ACV, is defined as the total annualized value of a contract, excluding amounts related to professional services and hardware. The total annualized value for a contract is calculated by dividing the total value of the contract by the number of years in the term of such contract, using, where applicable, an assumed term of five years for contracts that do not have a specified term. ACV Billings for any given period is defined as the sum of the ACV for all contracts billed during the given period.
2Run-rate ACV at the end of any period is the sum of ACV for all contracts that are in effect as of the end of that period. For the purposes of this calculation, Nutanix assumes that the contract term begins on the date a contract is booked, irrespective of the periods in which the company would recognize revenue for such contract.
3Total Average Contract Term represents the dollar-weighted term, calculated on a billings basis, across all subscription and life-of-device contracts, using an assumed term of five years for life-of-device licenses, executed in the quarter.
4Total Revenue was negatively impacted by a year-over-year decline in the average contract term associated with Nutanix's ongoing transition to a subscription-based business model.
5New ACV with respect to any given contract is defined as (i) if the contract is (A) with a new customer, the aggregate value of such contract excluding professional services, or (B) with an existing customer, the aggregate value of any upsell / expansion under such contract excluding professional services, in each case divided by (ii) the number of years in the term of such contract, using an assumed term of five years for life-of-device licenses.
Non-GAAP Financial Measures and Other Key Performance Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial and other key performance measures: billings, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net loss, non-GAAP net loss per share, free cash flow, subscription revenue, subscription billings, Annual Contract Value Billings (or ACV Billings), New Annual Contract Value (or New ACV), Run-rate Annual Contract Value (or Run-rate ACV), and professional services billings. In computing these non-GAAP financial measures and key performance measures, we exclude certain items such as stock-based compensation and the related income tax impact, costs associated with our acquisitions (such as amortization of acquired intangible assets, income tax-related impact, and other acquisition-related costs), impairment of operating lease-related assets, change in fair value of derivative liability, amortization of debt discount and issuance costs, non-cash interest expense, other non-recurring transactions and the related tax impact, and the revenue and billings associated with pass-through hardware sales. Billings is a performance measure which we believe provides useful information to investors because it represents the amounts under binding purchase orders received by us during a given period that have been billed, and we calculate billings by adding the change in deferred revenue between the start and end of the period to total revenue recognized in the same period. Non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net loss, and non-GAAP net loss per share are financial measures which we believe provide useful information to investors because they provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses and expenditures such as stock-based compensation expense that may not be indicative of our ongoing core business operating results. Free cash flow is a performance measure that we believe provides useful information to our management and investors about the amount of cash generated by the business after necessary capital expenditures, and we define free cash flow as net cash used in operating activities less purchases of property and equipment. Subscription revenue, subscription billings, and professional services billings are performance measures that we believe provide useful information to our management and investors as they allow us to better track the growth of the subscription-based portion of our business, which is a critical part of our business plan. ACV Billings, New ACV, and Run-rate ACV are performance measures that we believe provide useful information to our management and investors as they allow us to better track the topline growth of our business during our transition to a subscription-based business model because they take into account variability in term lengths. We use these non-GAAP financial and key performance measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. However, these non-GAAP financial and key performance measures have limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. Billings, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net loss, non-GAAP net loss per share, and free cash flow are not substitutes for total revenue, gross margin, operating expenses, net loss, net loss per share, or net cash (used in) provided by operating activities, respectively; subscription revenue is not a substitute for total revenue; and subscription and professional services billings are not substitutes for subscription and professional services revenue, respectively. There is no GAAP measure that is comparable to ACV Billings, New ACV or Run-rate ACV, so we have not reconciled the ACV Billings, New ACV and Run-rate ACV numbers included in this press release to any GAAP measure. In addition, other companies, including companies in our industry, may calculate non-GAAP financial measures and key performance measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures and key performance measures as tools for comparison. We urge you to review the reconciliation of our non-GAAP financial measures and key performance measures to the most directly comparable GAAP financial measures included below in the tables captioned “Reconciliation of Revenue to Billings,” “Disaggregation of Revenue and Billings,” “Reconciliation of Subscription and Professional Services Revenue to Subscription and Professional Services Billings,” “Reconciliation of GAAP to Non-GAAP Profit Measures,” and “Reconciliation of GAAP Net Cash Used In Operating Activities to Non-GAAP Free Cash Flow,” and not to rely on any single financial measure to evaluate our business.
Forward-Looking Statements
This press release contains express and implied forward-looking statements, including, but not limited to, statements regarding: our business plans, initiatives, objectives and outlook, including the actions we have taken to manage operating expenses and changes to the Company’s leadership structure and composition; our ability to execute such plans, initiatives and objectives successfully and in a timely manner, and the benefits and impact of such plans, initiatives and objectives, including our ability to continue executing on our business model transformation, manage our Chief Executive Officer transition, manage our expenses and decrease our cash usage in future periods, drive long-term value creation and sustained growth, and improve efficiency; the competitive market, including our competitive position and our projections about our market share and opportunity; our customer needs and our response to those needs; the benefits and capabilities of our platform, solutions, products, services and technology, including the interoperability and availability of our solutions with and on third-party platforms; our plans and expectations regarding new products, services, product features and technology, including those that are still under development or in process; our plans and timing for, and the success and impact of, our transition to a subscription-based business model and any changes in our guidance metrics; the timing and potential impact of the COVID-19 pandemic on the global market environment and the IT industry, as well as on our business, operations and financial results, including the changes we have made or anticipate making in response to the COVID-19 pandemic, our ability to manage our business during the pandemic, and the position we anticipate being in following the pandemic; and our guidance on estimated ACV Billings, non-GAAP gross margin, non-GAAP operating expenses and weighted average shares outstanding for any future fiscal periods. These forward-looking statements are not historical facts and instead are based on our current expectations, estimates, opinions, and beliefs. Consequently, you should not rely on these forward-looking statements. The accuracy of these forward-looking statements depends upon future events and involves risks, uncertainties, and other factors, including factors that may be beyond our control, that may cause these statements to be inaccurate and cause our actual results, performance or achievements to differ materially and adversely from those anticipated or implied by such statements, including, among others: failure to successfully implement or realize the full benefits of, or unexpected difficulties or delays in successfully implementing or realizing the full benefits of, our business plans, initiatives and objectives; the timing, breadth, and impact of the COVID-19 pandemic on our business, operations, and financial results, as well as the impact on our customers, partners, and end markets; failure to successfully manage or realize the benefits of our Chief Executive Officer succession; failure to timely and successfully meet our customer needs; delays in or lack of customer or market acceptance of our new products, services, product features or technology; delays or unexpected accelerations in the transition to a subscription-based business model; the rapid evolution of the markets in which we compete; our ability to achieve, sustain and/or manage future growth effectively; factors that could result in the significant fluctuation of our future quarterly operating results, including, among other things, anticipated changes to our revenue and product mix, including changes as a result of our transition to a subscription-based business model, which will slow revenue growth during such transition and make forecasting future performance more difficult, the timing and magnitude of orders, shipments and acceptance of our solutions in any given quarter, our ability to attract new and retain existing end-customers, changes in the pricing of certain components of our solutions, and fluctuations in demand and competitive pricing pressures for our solutions; the introduction, or acceleration of adoption of, competing solutions, including public cloud infrastructure; and other risks detailed in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020, filed with the U.S. Securities and Exchange Commission, or the SEC, on September 23, 2020. Additional information will also be set forth in our Quarterly Report on Form 10-Q that will be filed for the fiscal quarter ended January 31, 2021 which should be read in conjunction with this press release and the financial results included herein. Our SEC filings are available on the Investor Relations section of the company’s website at ir.nutanix.com and on the SEC's website at www.sec.gov. These forward-looking statements speak only as of the date of this press release and, except as required by law, we assume no obligation, and expressly disclaim any obligation, to update, alter or otherwise revise any of these forward-looking statements to reflect actual results or subsequent events or circumstances.
About Nutanix
Nutanix is a global leader in cloud software and a pioneer in hyperconverged infrastructure solutions, making computing invisible anywhere. Organizations around the world use Nutanix software to leverage a single platform to manage any app at any location for their private, hybrid and multicloud environments. Learn more at www.nutanix.com or follow us on Twitter @nutanix.
© 2021 Nutanix, Inc. All rights reserved. Nutanix, the Nutanix logo, and all Nutanix product and service names mentioned herein are registered trademarks or trademarks of Nutanix, Inc. in the United States and other countries. Other brand names mentioned herein are for identification purposes only and may be the trademarks of their respective holder(s). This press release contains links to external websites that are not part of Nutanix.com. Nutanix does not control these sites and disclaims all responsibility for the content or accuracy of any external site. Our decision to link to an external site should not be considered an endorsement of any content on such a site.
NUTANIX, INC. |
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(Unaudited) |
||||||||
|
|
As of |
||||||
|
|
July 31, |
|
January 31, |
||||
|
|
(in thousands, except per share data) |
|
|||||
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
318,737 |
|
|
$ |
298,701 |
|
Short-term investments |
|
|
401,041 |
|
|
|
990,138 |
|
Accounts receivable, net |
|
|
242,516 |
|
|
|
164,868 |
|
Deferred commissions—current |
|
|
68,694 |
|
|
|
92,025 |
|
Prepaid expenses and other current assets |
|
|
63,032 |
|
|
|
69,994 |
|
Total current assets |
|
|
1,094,020 |
|
|
|
1,615,726 |
|
Property and equipment, net |
|
|
143,172 |
|
|
|
131,971 |
|
Operating lease right-of-use assets |
|
|
127,326 |
|
|
|
121,066 |
|
Deferred commissions—non-current |
|
|
146,834 |
|
|
|
191,180 |
|
Intangible assets, net |
|
|
49,392 |
|
|
|
40,702 |
|
Goodwill |
|
|
185,260 |
|
|
|
185,260 |
|
Other assets—non-current |
|
|
22,543 |
|
|
|
25,547 |
|
Total assets |
|
$ |
1,768,547 |
|
|
$ |
2,311,452 |
|
Liabilities and Stockholders’ Deficit |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
54,029 |
|
|
$ |
52,459 |
|
Accrued compensation and benefits |
|
|
109,109 |
|
|
|
151,014 |
|
Accrued expenses and other current liabilities |
|
|
25,924 |
|
|
|
26,130 |
|
Deferred revenue—current |
|
|
534,572 |
|
|
|
578,664 |
|
Operating lease liabilities—current |
|
|
36,569 |
|
|
|
41,309 |
|
Total current liabilities |
|
|
760,203 |
|
|
|
849,576 |
|
Deferred revenue—non-current |
|
|
648,869 |
|
|
|
667,627 |
|
Operating lease liabilities—non-current |
|
|
116,794 |
|
|
|
107,784 |
|
Convertible senior notes, net |
|
|
490,222 |
|
|
|
1,011,725 |
|
Derivative liability |
|
|
— |
|
|
|
397,290 |
|
Other liabilities—non-current |
|
|
27,436 |
|
|
|
35,842 |
|
Total liabilities |
|
|
2,043,524 |
|
|
|
3,069,844 |
|
Stockholders’ deficit: |
|
|
|
|
|
|
|
|
Common stock |
|
|
5 |
|
|
|
5 |
|
Additional paid-in capital |
|
|
2,245,180 |
|
|
|
2,386,579 |
|
Accumulated other comprehensive income |
|
|
2,030 |
|
|
|
557 |
|
Accumulated deficit |
|
|
(2,522,192 |
) |
|
|
(3,145,533 |
) |
Total stockholders’ deficit |
|
|
(274,977 |
) |
|
|
(758,392 |
) |
Total liabilities and stockholders’ deficit |
|
$ |
1,768,547 |
|
|
$ |
2,311,452 |
|
NUTANIX, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
||||||||||||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product |
|
$ |
213,547 |
|
|
$ |
174,798 |
|
|
$ |
405,991 |
|
|
$ |
330,550 |
|
Support, entitlements and other services |
|
|
133,220 |
|
|
|
171,584 |
|
|
|
255,544 |
|
|
|
328,586 |
|
Total revenue |
|
|
346,767 |
|
|
|
346,382 |
|
|
|
661,535 |
|
|
|
659,136 |
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product (1)(2) |
|
|
20,676 |
|
|
|
13,784 |
|
|
|
41,909 |
|
|
|
26,598 |
|
Support, entitlements and other services (1) |
|
|
54,547 |
|
|
|
57,170 |
|
|
|
105,515 |
|
|
|
112,315 |
|
Total cost of revenue |
|
|
75,223 |
|
|
|
70,954 |
|
|
|
147,424 |
|
|
|
138,913 |
|
Gross profit |
|
|
271,544 |
|
|
|
275,428 |
|
|
|
514,111 |
|
|
|
520,223 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing (1)(2) |
|
|
304,936 |
|
|
|
261,071 |
|
|
|
596,774 |
|
|
|
518,361 |
|
Research and development (1) |
|
|
139,088 |
|
|
|
135,571 |
|
|
|
277,294 |
|
|
|
271,375 |
|
General and administrative (1) |
|
|
34,579 |
|
|
|
35,034 |
|
|
|
67,439 |
|
|
|
68,808 |
|
Total operating expenses |
|
|
478,603 |
|
|
|
431,676 |
|
|
|
941,507 |
|
|
|
858,544 |
|
Loss from operations |
|
|
(207,059 |
) |
|
|
(156,248 |
) |
|
|
(427,396 |
) |
|
|
(338,321 |
) |
Other expense, net |
|
|
(5,863 |
) |
|
|
(126,001 |
) |
|
|
(10,903 |
) |
|
|
(204,733 |
) |
Loss before provision for income taxes |
|
|
(212,922 |
) |
|
|
(282,249 |
) |
|
|
(438,299 |
) |
|
|
(543,054 |
) |
Provision for income taxes |
|
|
4,642 |
|
|
|
5,141 |
|
|
|
8,565 |
|
|
|
9,384 |
|
Net loss |
|
$ |
(217,564 |
) |
|
$ |
(287,390 |
) |
|
$ |
(446,864 |
) |
|
$ |
(552,438 |
) |
Net loss per share attributable to Class A and Class B common stockholders—basic and diluted |
$ |
(1.13 |
) |
$ |
(1.42 |
) |
|
$ |
(2.34 |
) |
|
$ |
(2.72 |
) |
||
Weighted average shares used in computing net loss per share attributable to Class A and Class B common stockholders—basic and diluted |
|
192,727 |
202,520 |
|
|
|
191,199 |
|
|
|
202,798 |
|
_________________________________________________ | ||
(1) |
|
Includes the following stock-based compensation expense: |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
||||||||||||||
Product cost of revenue |
|
$ |
1,458 |
|
|
$ |
1,659 |
|
|
$ |
2,570 |
|
|
$ |
3,163 |
|
Support, entitlements and other services cost of revenue |
|
|
5,140 |
|
|
|
5,764 |
|
|
|
9,891 |
|
|
|
11,525 |
|
Sales and marketing |
|
|
31,185 |
|
|
|
30,031 |
|
|
|
58,960 |
|
|
|
62,258 |
|
Research and development |
|
|
36,459 |
|
|
|
36,058 |
|
|
|
74,022 |
|
|
|
73,945 |
|
General and administrative |
|
|
11,373 |
|
|
|
10,942 |
|
|
|
21,598 |
|
|
|
22,761 |
|
Total stock-based compensation expense |
|
$ |
85,615 |
|
|
$ |
84,454 |
|
|
$ |
167,041 |
|
|
$ |
173,652 |
|
|
||
(2) |
|
Includes the following amortization of intangible assets: |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
|
|||||||||||||
Product cost of revenue |
|
$ |
3,694 |
|
|
$ |
3,694 |
|
|
$ |
7,388 |
|
|
$ |
7,388 |
|
Sales and marketing |
|
|
651 |
|
|
|
651 |
|
|
|
1,302 |
|
|
|
1,302 |
|
Total amortization of intangible assets |
|
$ |
4,345 |
|
|
$ |
4,345 |
|
|
$ |
8,690 |
|
|
$ |
8,690 |
|
NUTANIX, INC. |
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(Unaudited) |
||||||||
|
|
Six Months Ended |
||||||
|
|
2020 |
|
2021 |
||||
|
|
(in thousands) |
||||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(446,864 |
) |
|
$ |
(552,438 |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
45,540 |
|
|
|
47,087 |
|
Stock-based compensation |
|
|
167,041 |
|
|
|
173,652 |
|
Change in fair value of derivative liability |
|
|
— |
|
|
|
166,380 |
|
Amortization of debt discount and issuance costs |
|
|
15,398 |
|
|
|
28,796 |
|
Operating lease cost, net of accretion |
|
|
14,539 |
|
|
|
16,930 |
|
Impairment of lease-related assets |
|
|
3,002 |
|
|
|
2,822 |
|
Non-cash interest expense |
|
|
— |
|
|
|
6,615 |
|
Other |
|
|
(236 |
) |
|
|
4,354 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable, net |
|
|
(1,848 |
) |
|
|
79,173 |
|
Deferred commissions |
|
|
(35,422 |
) |
|
|
(67,677 |
) |
Prepaid expenses and other assets |
|
|
9,064 |
|
|
|
(9,217 |
) |
Accounts payable |
|
|
(3,428 |
) |
|
|
(2,602 |
) |
Accrued compensation and benefits |
|
|
20,085 |
|
|
|
39,593 |
|
Accrued expenses and other liabilities |
|
|
974 |
|
|
|
2,100 |
|
Operating leases, net |
|
|
(13,039 |
) |
|
|
(16,523 |
) |
Deferred revenue |
|
|
146,540 |
|
|
|
61,325 |
|
Net cash used in operating activities |
|
|
(78,654 |
) |
|
|
(19,630 |
) |
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Maturities of investments |
|
|
299,380 |
|
|
|
260,852 |
|
Purchases of investments |
|
|
(416,636 |
) |
|
|
(859,576 |
) |
Sales of investments |
|
|
24,147 |
|
|
|
2,999 |
|
Purchases of property and equipment |
|
|
(39,451 |
) |
|
|
(25,168 |
) |
Net cash used in investing activities |
|
|
(132,560 |
) |
|
|
(620,893 |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds from sales of shares through employee equity incentive plans |
|
|
26,486 |
|
|
|
21,904 |
|
Proceeds from the issuance of convertible notes, net of issuance costs |
|
|
— |
|
|
|
723,617 |
|
Repurchases of common stock |
|
|
— |
|
|
|
(125,079 |
) |
Net cash provided by financing activities |
|
|
26,486 |
|
|
|
620,442 |
|
Net decrease in cash, cash equivalents and restricted cash |
|
$ |
(184,728 |
) |
|
$ |
(20,080 |
) |
Cash, cash equivalents and restricted cash—beginning of period |
|
|
399,520 |
|
|
|
321,991 |
|
Cash, cash equivalents and restricted cash—end of period |
|
$ |
214,792 |
|
|
$ |
301,911 |
|
Restricted cash (1) |
|
|
3,099 |
|
|
|
3,210 |
|
Cash and cash equivalents—end of period |
|
$ |
211,693 |
|
|
$ |
298,701 |
|
Supplemental disclosures of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
|
$ |
11,195 |
|
|
$ |
8,999 |
|
Supplemental disclosures of non-cash investing and financing information: |
|
|
|
|
|
|
|
|
Purchases of property and equipment included in accounts payable and accrued and other liabilities |
|
$ |
13,997 |
|
|
$ |
7,621 |
|
Finance lease liabilities arising from obtaining right-of-use assets |
|
$ |
— |
|
|
$ |
1,960 |
|
_________________________________________________ |
||
(1) |
|
Included within other assets—non-current in the condensed consolidated balance sheets. |
Reconciliation of Revenue to Billings |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
||||||||||||||
Total revenue |
|
$ |
346,767 |
|
|
$ |
346,382 |
|
|
$ |
661,535 |
|
|
$ |
659,136 |
|
Change in deferred revenue |
|
|
81,310 |
|
|
|
39,131 |
|
|
|
146,540 |
|
|
|
61,325 |
|
Total billings |
|
$ |
428,077 |
|
|
$ |
385,513 |
|
|
$ |
808,075 |
|
|
$ |
720,461 |
|
Disaggregation of Revenue and Billings |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
||||||||||||||
Disaggregation of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscription revenue |
|
$ |
266,544 |
|
|
$ |
305,946 |
|
|
$ |
484,440 |
|
|
$ |
584,111 |
|
Non-portable software revenue |
|
|
59,131 |
|
|
|
21,661 |
|
|
|
136,702 |
|
|
|
41,704 |
|
Hardware revenue |
|
|
8,542 |
|
|
|
1,321 |
|
|
|
18,266 |
|
|
|
2,050 |
|
Professional services revenue |
|
|
12,550 |
|
|
|
17,454 |
|
|
|
22,127 |
|
|
|
31,271 |
|
Total revenue |
|
$ |
346,767 |
|
|
$ |
346,382 |
|
|
$ |
661,535 |
|
|
$ |
659,136 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disaggregation of billings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscription billings |
|
$ |
339,142 |
|
|
$ |
339,168 |
|
|
$ |
614,680 |
|
|
$ |
633,091 |
|
Non-portable software billings |
|
|
59,131 |
|
|
|
21,661 |
|
|
|
136,702 |
|
|
|
41,704 |
|
Hardware billings |
|
|
8,542 |
|
|
|
1,321 |
|
|
|
18,266 |
|
|
|
2,050 |
|
Professional services billings |
|
|
21,262 |
|
|
|
23,363 |
|
|
|
38,427 |
|
|
|
43,616 |
|
Total billings |
|
$ |
428,077 |
|
|
$ |
385,513 |
|
|
$ |
808,075 |
|
|
$ |
720,461 |
|
Subscription — Subscription revenue includes any performance obligation which has a defined term, and is generated from the sales of software entitlement and support subscriptions, subscription software licenses and cloud-based Software as a Service, or SaaS offerings.
Non-portable software — Non-portable software revenue includes sales of our enterprise cloud platform when delivered on a configured-to-order appliance by us or one of our OEM partners. The software licenses associated with these sales are typically non-portable and have a term equal to the life of the appliance on which the software is delivered. Revenue from our non-portable software products is generally recognized upon transfer of control to the customer.
Hardware — In transactions where we deliver the hardware appliance, we consider ourselves to be the principal in the transaction and we record revenue and costs of goods sold on a gross basis. We consider the amount allocated to hardware revenue to be equivalent to the cost of the hardware procured. Hardware revenue is generally recognized upon transfer of control to the customer.
Professional services — We also sell professional services with our products. We recognize revenue related to professional services as they are performed.
Annual Contract Value Billings and Run-rate Annual Contract Value |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
|
|||||||||||||
Annual Contract Value Billings (ACV Billings) |
|
$ |
139,529 |
|
|
$ |
159,208 |
|
|
$ |
256,965 |
|
|
$ |
285,956 |
|
Run-rate Annual Contract Value (Run-rate ACV) |
|
$ |
1,080,931 |
|
|
$ |
1,384,823 |
|
|
$ |
1,080,931 |
|
|
$ |
1,384,823 |
|
Reconciliation of Subscription and Professional Services Revenue to Subscription and Professional Services Billings |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
|
|||||||||||||
Subscription revenue |
|
$ |
266,544 |
|
|
$ |
305,946 |
|
|
$ |
484,440 |
|
|
$ |
584,111 |
|
Change in subscription deferred revenue |
|
|
72,598 |
|
|
|
33,222 |
|
|
|
130,240 |
|
|
|
48,980 |
|
Subscription billings |
|
$ |
339,142 |
|
|
$ |
339,168 |
|
|
$ |
614,680 |
|
|
$ |
633,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional services revenue |
|
$ |
12,550 |
|
|
$ |
17,454 |
|
|
$ |
22,127 |
|
|
$ |
31,271 |
|
Change in professional services deferred revenue |
|
|
8,712 |
|
|
|
5,909 |
|
|
|
16,300 |
|
|
|
12,345 |
|
Professional services billings |
|
$ |
21,262 |
|
|
$ |
23,363 |
|
|
$ |
38,427 |
|
|
$ |
43,616 |
|
Reconciliation of GAAP to Non-GAAP Profit Measures |
||||||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||||||
|
|
GAAP |
|
Non-GAAP Adjustments |
|
Non-GAAP |
||||||||||||||||||||||||||
|
|
Three Months |
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
(5) |
|
(6) |
|
Three Months |
||||||||||||||||
|
|
(in thousands, except percentages and per share data) |
|
|||||||||||||||||||||||||||||
Gross profit |
|
$ |
275,428 |
|
|
$ |
7,423 |
|
|
$ |
3,694 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
286,545 |
|
Gross margin |
|
|
79.5 |
% |
|
|
2.1 |
% |
|
|
1.1 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
82.7 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
261,071 |
|
|
|
(30,031 |
) |
|
|
(651 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
230,389 |
|
Research and development |
|
|
135,571 |
|
|
|
(36,058 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
99,513 |
|
General and administrative |
|
|
35,034 |
|
|
|
(10,942 |
) |
|
|
— |
|
|
|
(467 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
23,625 |
|
Total operating expenses |
|
|
431,676 |
|
|
|
(77,031 |
) |
|
|
(651 |
) |
|
|
(467 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
353,527 |
|
Loss from operations |
|
|
(156,248 |
) |
|
|
84,454 |
|
|
|
4,345 |
|
|
|
467 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(66,982 |
) |
Net loss |
|
$ |
(287,390 |
) |
|
$ |
84,454 |
|
|
$ |
4,345 |
|
|
$ |
467 |
|
|
$ |
101,640 |
|
|
$ |
21,751 |
|
|
$ |
609 |
|
|
$ |
(74,124 |
) |
Weighted shares outstanding, basic and diluted |
|
|
202,520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
202,520 |
|
Net loss per share, basic and diluted |
|
$ |
(1.42 |
) |
|
$ |
0.42 |
|
|
$ |
0.02 |
|
|
$ |
— |
|
|
$ |
0.50 |
|
|
$ |
0.11 |
|
|
$ |
— |
|
|
$ |
(0.37 |
) |
_________________________________________________ |
||
(1) |
|
Stock-based compensation |
(2) |
|
Amortization of intangible assets |
(3) |
|
Other |
(4) |
|
Change in fair value of derivative liability |
(5) |
|
Amortization of debt discount and issuance costs and non-cash interest expense |
(6) |
|
Income tax effect primarily related to stock-based compensation expense |
|
|
GAAP |
|
Non-GAAP Adjustments |
|
|
Non-GAAP |
|||||||||||||||||||||||||||||
|
|
Six Months |
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
(5) |
|
(6) |
|
(7) |
|
Six Months |
||||||||||||||||||
|
|
(in thousands, except percentages and per share data) |
|
|||||||||||||||||||||||||||||||||
Gross profit |
|
$ |
520,223 |
|
|
$ |
14,688 |
|
|
$ |
7,388 |
|
|
$ |
287 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
542,586 |
|
Gross margin |
|
|
78.9 |
% |
|
|
2.2 |
% |
|
|
1.1 |
% |
|
|
0.1 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
82.3 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
518,361 |
|
|
|
(62,258 |
) |
|
|
(1,302 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
454,801 |
|
Research and development |
|
|
271,375 |
|
|
|
(73,945 |
) |
|
|
— |
|
|
|
(2,535 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
194,895 |
|
General and administrative |
|
|
68,808 |
|
|
|
(22,761 |
) |
|
|
— |
|
|
|
— |
|
|
|
(973 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
45,074 |
|
Total operating expenses |
|
|
858,544 |
|
|
|
(158,964 |
) |
|
|
(1,302 |
) |
|
|
(2,535 |
) |
|
|
(973 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
694,770 |
|
Loss from operations |
|
|
(338,321 |
) |
|
|
173,652 |
|
|
|
8,690 |
|
|
|
2,822 |
|
|
|
973 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(152,184 |
) |
Net loss |
|
$ |
(552,438 |
) |
|
$ |
173,652 |
|
|
$ |
8,690 |
|
|
$ |
2,822 |
|
|
$ |
973 |
|
|
$ |
166,380 |
|
|
$ |
35,411 |
|
|
$ |
1,002 |
|
|
$ |
(163,508 |
) |
Weighted shares outstanding, basic and diluted |
|
|
202,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
202,798 |
|
Net loss per share, basic and diluted |
|
$ |
(2.72 |
) |
|
$ |
0.86 |
|
|
$ |
0.04 |
|
|
$ |
0.01 |
|
|
$ |
— |
|
|
$ |
0.82 |
|
|
$ |
0.18 |
|
|
$ |
— |
|
|
$ |
(0.81 |
) |
_________________________________________________ |
||
(1) |
|
Stock-based compensation |
(2) |
|
Amortization of intangible assets |
(3) |
|
Impairment of lease-related assets |
(4) |
|
Other |
(5) |
|
Change in fair value of derivative liability |
(6) |
|
Amortization of debt discount and issuance costs |
(7) |
|
Income tax effect primarily related to stock-based compensation expense |
|
|
GAAP |
|
Non-GAAP Adjustments |
|
Non-GAAP |
||||||||||||||||||||||||||
|
|
Three Months |
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
(5) |
|
(6) |
|
Three Months |
||||||||||||||||
|
|
(in thousands, except percentages and per share data) |
|
|||||||||||||||||||||||||||||
Gross profit |
|
$ |
271,544 |
|
|
$ |
6,598 |
|
|
$ |
3,694 |
|
|
$ |
537 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
282,373 |
|
Gross margin |
|
|
78.3 |
% |
|
|
1.8 |
% |
|
|
1.1 |
% |
|
|
0.2 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
81.4 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
304,936 |
|
|
|
(31,185 |
) |
|
|
(651 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
273,100 |
|
Research and development |
|
|
139,088 |
|
|
|
(36,459 |
) |
|
|
— |
|
|
|
(2,465 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
100,164 |
|
General and administrative |
|
|
34,579 |
|
|
|
(11,373 |
) |
|
|
— |
|
|
|
— |
|
|
|
(154 |
) |
|
|
— |
|
|
|
— |
|
|
|
23,052 |
|
Total operating expenses |
|
|
478,603 |
|
|
|
(79,017 |
) |
|
|
(651 |
) |
|
|
(2,465 |
) |
|
|
(154 |
) |
|
|
— |
|
|
|
— |
|
|
|
396,316 |
|
Loss from operations |
|
|
(207,059 |
) |
|
|
85,615 |
|
|
|
4,345 |
|
|
|
3,002 |
|
|
|
154 |
|
|
|
— |
|
|
|
— |
|
|
|
(113,943 |
) |
Net loss |
|
$ |
(217,564 |
) |
|
$ |
85,615 |
|
|
$ |
4,345 |
|
|
$ |
3,002 |
|
|
$ |
154 |
|
|
$ |
7,763 |
|
|
$ |
405 |
|
|
$ |
(116,280 |
) |
Weighted shares outstanding, basic and diluted |
|
|
192,727 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
192,727 |
|
Net loss per share, basic and diluted |
|
$ |
(1.13 |
) |
|
$ |
0.44 |
|
|
$ |
0.03 |
|
|
$ |
0.02 |
|
|
$ |
— |
|
|
$ |
0.04 |
|
|
$ |
— |
|
|
$ |
(0.60 |
) |
_________________________________________________ |
||
(1) |
|
Stock-based compensation |
(2) |
|
Amortization of intangible assets |
(3) |
|
Impairment of lease-related assets |
(4) |
|
Other |
(5) |
|
Amortization of debt discount and debt issuance costs |
(6) |
|
Income tax effect primarily related to stock-based compensation expense |
|
|
GAAP |
|
Non-GAAP Adjustments |
|
Non-GAAP |
||||||||||||||||||||||||||
|
|
Six Months |
|
(1) |
|
(2) |
|
(3) |
|
(4) |
|
(5) |
|
(6) |
|
Six Months |
||||||||||||||||
|
|
(in thousands, except share and per share data) |
|
|||||||||||||||||||||||||||||
Gross profit |
|
$ |
514,111 |
|
|
$ |
12,461 |
|
|
$ |
7,388 |
|
|
$ |
537 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
534,497 |
|
Gross margin |
|
|
77.7 |
% |
|
|
1.9 |
% |
|
|
1.1 |
% |
|
|
0.1 |
% |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
80.8 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
596,774 |
|
|
|
(58,960 |
) |
|
|
(1,302 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
536,512 |
|
Research and development |
|
|
277,294 |
|
|
|
(74,022 |
) |
|
|
— |
|
|
|
(2,465 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
200,807 |
|
General and administrative |
|
|
67,439 |
|
|
|
(21,598 |
) |
|
|
— |
|
|
|
— |
|
|
|
(507 |
) |
|
|
— |
|
|
|
— |
|
|
|
45,334 |
|
Total operating expenses |
|
|
941,507 |
|
|
|
(154,580 |
) |
|
|
(1,302 |
) |
|
|
(2,465 |
) |
|
|
(507 |
) |
|
|
— |
|
|
|
— |
|
|
|
782,653 |
|
Loss from operations |
|
|
(427,396 |
) |
|
|
167,041 |
|
|
|
8,690 |
|
|
|
3,002 |
|
|
|
507 |
|
|
|
— |
|
|
|
— |
|
|
|
(248,156 |
) |
Net loss |
|
$ |
(446,864 |
) |
|
$ |
167,041 |
|
|
$ |
8,690 |
|
|
$ |
3,002 |
|
|
$ |
507 |
|
|
$ |
15,398 |
|
|
$ |
618 |
|
|
$ |
(251,608 |
) |
Weighted shares outstanding, basic and diluted |
|
|
191,199 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
191,199 |
|
Net loss per share, basic and diluted |
|
$ |
(2.34 |
) |
|
$ |
0.87 |
|
|
$ |
0.05 |
|
|
$ |
0.02 |
|
|
$ |
— |
|
|
$ |
0.08 |
|
|
$ |
— |
|
|
$ |
(1.32 |
) |
_________________________________________________ |
||
(1) |
|
Stock-based compensation expense |
(2) |
|
Amortization of intangible assets |
(3) |
|
Impairment of lease-related assets |
(4) |
|
Other |
(5) |
|
Amortization of debt discount and issuance costs |
(6) |
|
Income tax effect primarily related to stock-based compensation expense |
Reconciliation of GAAP Net Cash Used In Operating Activities to Non-GAAP Free Cash Flow |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended January 31, |
|
Six Months Ended January 31, |
||||||||||||
|
|
2020 |
|
2021 |
|
2020 |
|
2021 |
||||||||
|
|
(in thousands) |
|
|||||||||||||
Net cash used in operating activities |
|
$ |
(52,491 |
) |
|
$ |
(15,557 |
) |
|
$ |
(78,654 |
) |
|
$ |
(19,630 |
) |
Purchases of property and equipment |
|
(21,248 |
) |
|
(12,916 |
) |
|
(39,451 |
) |
|
(25,168 |
) |
||||
Free cash flow |
|
$ |
(73,739 |
) |
|
$ |
(28,473 |
) |
|
$ |
(118,105 |
) |
|
$ |
(44,798 |
) |
Investor Contact:
Tonya Chin
ir@nutanix.com
Media Contact:
Jennifer Massaro
pr@nutanix.com