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Press Release: Proofpoint Announces Fourth -5-

· 02/04/2021 16:05
Three Months Ending Year Ending March 31, December 31, ------------------- ------------------- 2021 2021 ------------------- ------------------- Total revenue $280.0 - $282.0 $1,190.0 - $1,200.0 GAAP gross profit 206.7 - 208.7 878.6 - 887.3 GAAP gross margin 74% 74% Plus: Stock-based compensation expense 6.7 - 6.3 32.5 - 31.8 Intangible amortization expense 10.6 40.9 ------------------- ------------------- Non-GAAP gross profit 224.0 - 225.6 952.0 - 960.0 ------------------- ------------------- Non-GAAP gross margin 80% 80% GAAP net loss (36.4) - (32.2) (154.4) - (143.4) Plus: Stock-based compensation expense 48.0 - 45.0 232.0- 227.0 Intangible amortization expense 13.9 54.3 Litigation-related expenses 1.7 7.4 Interest expense - debt issuance costs 1.0 3.8 Income tax expense (3.2) - (3.4) (18.1) - (19.1) ------------------- ------------------- Non-GAAP net income 25.0 - 26.0 125.0 - 130.0 Add interest expense of convertible senior notes, net of tax (if dilutive) 0.5 1.9 ------------------- ------------------- Numerator for non-GAAP EPS calculation $25.5 - $26.5 $126.9 - $131.9 =================== =================== Non-GAAP net income per share - diluted $0.39 - $0.40 $1.91 - $1.99 Non-GAAP weighted average shares used to compute net income per share, diluted 65.6 66.4 Three Months Ending Year Ending March 31, December 31, ------------------- ------------------- 2021 2021 ------------------- ------------------- GAAP cash flows provided by operating activities $88.0 - $94.0 $245.00 - $255.0 Less: Purchases of property and equipment (8.0) - (9.0) (45.0) ------------------- ------------------- Non-GAAP free cash flows $80.0 - $85.0 $200.0 - $210.0 =================== ===================Three Months Ended Twelve Months Ended December 31, December 31, -------------------- ---------------------- 2020 2019 2020 2019 --------- --------- --------- ----------- GAAP cash flows provided by operating activities $ 55,681 $ 76,401 $264,488 $242,508 Less: Purchases of property and equipment (26,798) (11,337) (72,420) (35,193) ------- ------- ------- ------- Non-GAAP free cash flows $ 28,883 $ 65,064 $192,068 $207,315 ======= ======= ======= =======Three Months Ended Twelve Months Ended December 31, December 31, -------------------- ------------------------- 2020 2019 2020 2019 ------- ------- --------- --------- Total revenue $275,129 $243,429 $1,050,010 $ 888,190 Deferred revenue and customer prepayments Ending 904,126 797,173 904,126 797,173 Beginning 804,197 688,105 797,173 605,073 ------- ------- --------- --------- Net Change 99,929 109,068 106,953 192,100 ------- ------- --------- --------- Unbilled accounts receivable Ending 1,877 2,255 1,877 2,255 Beginning 1,756 4,060 2,255 1,276 ------- ------- --------- --------- Net Change (121) 1,805 378 (979) ------- ------- --------- --------- Less: Deferred revenue and customer prepayments contributed by acquisitions -- (7,152) -- (7,152) ------- ------- --------- --------- Billings $374,937 $347,150 $1,157,341 $1,072,159 ======= ======= ========= =========Litigation-related expenses 2,009 753 5,540 1,880 Facility exit costs 594 -- 1,383 -- ------- ------- -------- -------- Non-GAAP operating income 43,308 37,001 156,788 122,225 ------- ------- -------- -------- GAAP net loss (35,102) (28,734) (163,809) (130,265) Plus: Stock-based compensation expense 47,766 43,971 186,699 176,325 Intangible amortization expense 14,412 12,692 57,505 45,648 Acquisition-related expenses 14 2,394 857 3,303 Litigation-related expenses 2,009 753 5,540 1,880 Facility exit costs 594 -- 1,383 -- Interest expense - debt discount and issuance costs 8,627 8,253 33,941 11,708 Income tax expense (1) (5,227) (6,154) 6,564 (1,931) ------- ------- -------- -------- Non-GAAP net income 33,093 33,175 128,680 106,668 Add interest expense of convertible senior notes, net of tax (2) 478 575 1,909 818 ------- ------- -------- -------- Numerator for non-GAAP EPS calculation $ 33,571 $ 33,750 $ 130,589 $ 107,486 ======= ======= ======== ======== Non-GAAP net income per share - diluted $ 0.51 $ 0.52 $ 1.99 $ 1.77 GAAP weighted average shares used to compute net loss per share, diluted 57,335 56,474 57,324 55,902 Dilutive effect of convertible senior notes (2) 5,975 5,975 5,975 2,144 Dilutive effect of employee equity incentive plan awards (3) 2,134 2,486 2,323 2,668 ------- ------- -------- -------- Non-GAAP weighted average shares used to compute net income per share, diluted 65,444 64,935 65,622 60,714 ======= ======= ======== ========

(1) The Company's current and deferred income tax expense commensurate with the non-GAAP measure of profitability using non-GAAP tax rate of 17% for the three and twelve months ended December 31, 2020 and 2019. The Company uses annual projected tax rate in its computation of the non-GAAP income tax provision, and excludes the direct impact of stock-based compensation, intangible amortization expenses, costs associated with acquisitions, litigations, facility exit costs related to the relocation of our corporate headquarters, and non-cash interest expense related to the debt discount and issuance costs for the convertible notes.

(2) The Company uses the if-converted method to compute diluted earnings per share with respect to its convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive.

(3) The Company uses the treasury method to compute the dilutive effect of employee equity incentive plan awards.

Reconciliation of Total Revenue to Billings

(In thousands)

(Unaudited)

Reconciliation of GAAP Cash Flows from Operations to Free Cash Flows

(In thousands)

(Unaudited)

Reconciliation of Non-GAAP Measures to Guidance

(In millions, except per share amount)

(Unaudited)

Media Contact

Kristy Campbell

Proofpoint, Inc.

408-517-4710

kcampbell@proofpoint.com

Investor Contact

Jason Starr

Proofpoint, Inc.

408-585-4351

jstarr@proofpoint.com

(END) Dow Jones Newswires

February 04, 2021 16:05 ET (21:05 GMT)