BroadSoft Reports Second Quarter 2017 Financial Results

08/07/17

GAITHERSBURG, Md., Aug. 07, 2017 (GLOBE NEWSWIRE) -- BroadSoft, Inc. (NASDAQ:BSFT), a global market leader in cloud business software for unified communication as a service (UCaaS), and provider of team collaboration and contact center as a service (CCaaS), today announced financial results for the quarter ended June 30, 2017.

Financial Highlights for the Second Quarter of 2017

  • Total revenue increased 9% year-over-year to $88.8 million

  • GAAP gross profit equaled 71% of total revenue; non-GAAP gross profit equaled 76% of total revenue

  • GAAP loss from operations totaled $(1.5) million; non-GAAP income from operations totaled $13.1 million or 15% of revenue

  • GAAP basic and diluted net loss per share equaled $(0.10) per common share; non-GAAP diluted earnings per share equaled $0.40 per common share

Results for the three months ended June 30, 2017

Total revenue rose to $88.8 million in the second quarter of 2017, an increase of 9% compared to $81.7 million in the second quarter of 2016.

Net loss for the second quarter of 2017 was $(3.0) million, or $(0.10) per basic and diluted common share, compared to net loss of $(2.9) million, or $(0.10) per basic and diluted common share in the second quarter of 2016.

On a non-GAAP basis, net income in the second quarter of 2017 was $12.5 million, or $0.40 per diluted common share, compared to non-GAAP net income of $15.0 million, or $0.49 per diluted common share, in the second quarter of 2016. A reconciliation of non-GAAP and GAAP results is included in the financial tables below.

Results for the six months ended June 30, 2017

Total revenue rose to $168.4 million for the first six months of 2017, an increase of 9% compared to $154.9 million for the first six months of 2016.

Net loss for the first six months of 2017 was $(13.5) million, or $(0.44) per basic and diluted common share, compared to a net loss of $(4.4) million, or $(0.15) per basic and diluted common share for the first six months of 2016.

On a non-GAAP basis, net income for the first six months of 2017 was $18.7 million, or $0.59 per diluted common share, compared to non-GAAP net income of $26.0 million, or $0.87 per diluted common share, for the first six months of 2016. A reconciliation of non-GAAP and GAAP results is included in the financial tables below.

Management Commentary

“We are pleased with our second quarter and first half 2017 results.  We believe we enter the second half of 2017 with continued positive business momentum as we build on our achievements from the first half," said Michael Tessler, president and chief executive officer, BroadSoft.  “We had several important BroadCloud launches in the first half of the year.  We introduced BroadCloud services in Australia with our launch partner, Optus, the second largest telecommunications provider in the country.  We are excited by the growth in our BroadCloud footprint and our business opportunities overall."

Guidance

For the third quarter of 2017, BroadSoft anticipates revenue of $84 to $90 millionBroadSoft also expects to achieve earnings on a non-GAAP basis of $0.23 to $0.40 per diluted common share.  For the full year 2017, BroadSoft expects revenue in the range of $380 million to $390 million and non-GAAP earnings per diluted common share in the range of $2.20 to $2.50.

A reconciliation of non-GAAP earnings per share guidance, as well as projected non-GAAP cost of sales and operating expenses to be discussed on this morning's teleconference, to the closest corresponding GAAP measures, is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures, in particular, the measures and effects of non-cash income taxes and stock-based compensation expense. We expect the variability of the above charges to have a significant, and potentially unpredictable, impact on our future GAAP financial results.

Conference Call

BroadSoft will discuss its second quarter 2017 results and its business outlook today via teleconference at 8:30 a.m. Eastern Time. To participate in the teleconference, callers can dial the toll free number 1-877-312-5517 (U.S. callers only) or 1-760-666-3772 (from outside the U.S.). The conference call can also be heard live via audio webcast at http://investors.broadsoft.com/events-and-presentations. To help ensure the conference begins on time, please dial in or connect via the web five minutes prior to the scheduled start time.

For those unable to participate in the live call, a recording will be available shortly after the conclusion of the call at http://investors.broadsoft.com/events-and-presentations and will remain available until immediately prior to our next earnings call.

Non-GAAP financial measures:

BroadSoft has provided in this release, and will provide on this morning’s teleconference, financial information that has not been prepared in accordance with generally accepted accounting principles, or GAAP. BroadSoft uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating BroadSoft’s ongoing operational performance. BroadSoft’s management regularly uses these non-GAAP financial measures to understand and manage its business and believes these non-GAAP financial measures provide meaningful supplemental information regarding BroadSoft’s performance by excluding certain non-cash expenses, and may include additional adjustments for items that are infrequent in nature. BroadSoft believes 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 its financial results with other companies in BroadSoft’s industry, many of which present similar non-GAAP financial measures to investors. A reconciliation of the non-GAAP financial measures included in this release and to be discussed on this morning’s teleconference to the most directly comparable GAAP financial measures is set forth below.

Non-GAAP cost of revenue, license software cost of revenue, subscription and maintenance cost of revenue and professional services and other cost of revenue. We define non-GAAP cost of revenue as a cost of revenue less stock-based compensation expense and amortization expense for acquired intangible assets. We consider non-GAAP cost of revenue to be a useful metric for management and our investors because it excludes the effect of certain non-cash expenses so management and investors can compare our cost of revenue over multiple periods.

Non-GAAP gross profit, license software gross profit, subscription and maintenance support gross profit and professional services and other gross profit. We define non-GAAP gross profit as gross profit plus stock-based compensation expense and amortization expense for acquired intangible assets. We consider non-GAAP gross profit to be a useful metric for management and our investors because it excludes the effect of certain non-cash expenses so management and investors can compare our sales margins over multiple periods.

Non-GAAP income from operations. We define non-GAAP operating income as income from operations plus stock-based compensation expense and amortization expense for acquired intangible assets. We consider non-GAAP operating income to be a useful metric for management and investors because it excludes the effect of certain non-cash expenses so management and investors can compare our core business operating results over multiple periods.

Non-GAAP operating expenses, sales and marketing expense, research and development expense and general and administrative expense. We define non-GAAP operating expenses as operating expense plus stock-based compensation expense allocated to sales and marketing, research and development and general and administrative expenses. Similarly, we define non-GAAP sales and marketing, research and development and general and administrative expenses as the relevant GAAP measure plus stock-based compensation expense allocated to the particular expense item.

Non-GAAP net income and net income per share. We define non-GAAP net income as net income plus stock-based compensation expense, amortization expense for acquired intangible assets, non-cash interest expense on our convertible senior notes, foreign currency transaction gains and losses, loss on repurchase of our convertible senior notes and non-cash tax expense included in the GAAP tax provision. We define non-GAAP income per share as non-GAAP net income divided by the weighted average shares outstanding.

The presentation of non-GAAP net income, non-GAAP net income per share, non-GAAP gross margin, non-GAAP income from operations, and other non-GAAP financial measures in this release and on this morning’s teleconference is not meant to be a substitute for “net income,” “net income per share,” “gross margin,” “income from operations” or other financial measures presented in accordance with GAAP, but rather should be evaluated in conjunction with such data. BroadSoft’s definition of “non-GAAP net income,” “non-GAAP net income per share,” “non-GAAP gross margin,” “non-GAAP income from operations” and other non-GAAP financial measures may differ from similarly titled non-GAAP measures used by other companies and may differ from period to period. In reporting non-GAAP measures in the future, management may make other adjustments for expenses and gains it does not consider reflective of core operating performance in a particular period and may modify “non-GAAP net income,” “non-GAAP net income per share,” “non-GAAP gross margin,” “non-GAAP income from operations” and such other non-GAAP measures by excluding these expenses and gains.

Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by their use of terms and phrases such as “anticipate,” “expect,” “will,” “believe,” “continue” and other similar terms and phrases, and such forward-looking statements include, but are not limited to, the statements regarding BroadSoft’s future financial performance set forth under the heading “Guidance.” The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including, but not limited to: BroadSoft's ability to expand its BroadCloud offering geographically and increase the associated recurring service revenue; BroadSoft’s dependence on the success of BroadWorks and on its service provider customers to sell services using its applications; BroadSoft’s dependence in large part on service providers’ continued deployment of, and investment in, their IP-based networks; claims that BroadSoft infringes the intellectual property rights of others; BroadSoft’s ability to integrate and achieve the expected benefits from its recent acquisitions; and BroadSoft’s ability to expand its product offerings, as well as those factors contained in the “Risk Factors” sections of BroadSoft’s Form 10-K for the year ended December 31, 2016 filed with the SEC on February 23, 2017, and in BroadSoft’s other filings with the SEC. All information in this release is as of August 7, 2017. Except as required by law, BroadSoft undertakes no obligation to update publicly any forward-looking statement made herein for any reason to conform the statement to actual results or changes in BroadSoft’s expectations.

About BroadSoft

BroadSoft is the technology innovator in cloud PBX, unified communications, collaboration, and contact center solutions for businesses and service providers across 80 countries.  We are the market share leader for cloud unified communications with an open, mobile and secure platform trusted by 25 of the world's top 30 service providers by revenue.  Our BroadSoft Business application suite empowers users and teams to share ideas and work simply to achieve breakthrough performance.

Financial Statements

The financial statements set forth below are not the complete set of BroadSoft’s financial statements for the quarter and the year and are presented below without footnotes. Readers are encouraged to obtain and carefully review BroadSoft’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, including all financial statements contained therein and the footnotes thereto, once the report is filed with the SEC. Once filed with the SEC, the Form 10-Q may be retrieved from the SEC’s website at www.sec.gov or from BroadSoft’s website at www.broadsoft.com.

BSFT-F

 
BroadSoft, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
       
  June 30,
 2017
  December 31,
 2016
  (Unaudited)    
Assets:      
Current assets:      
Cash and cash equivalents $ 120,828     $ 82,993  
Short-term investments 246,715     136,428  
Accounts receivable, net of allowance for doubtful accounts of $118 and $108 at June 30, 2017 and December 31, 2016, respectively 103,443     121,817  
Other current assets 27,444     17,431  
Total current assets 498,430     358,669  
Long-term assets:      
Property and equipment, net 25,752     22,626  
Long-term investments 11,326     144,159  
Intangible assets, net 24,701     27,839  
Goodwill 84,711     82,758  
Deferred tax assets 28,982     7,042  
Other long-term assets 8,143     8,107  
Total long-term assets 183,615     292,531  
Total assets $ 682,045     $ 651,200  
Liabilities and stockholders’ equity:      
Current liabilities:      
Accounts payable and accrued expenses $ 34,803     $ 33,854  
Deferred revenue, current portion 91,611     97,037  
Total current liabilities 126,414     130,891  
Convertible senior notes 207,697     201,015  
Deferred revenue 7,633     12,152  
Other long-term liabilities 7,476     5,908  
Total liabilities 349,220     349,966  
Commitments and contingencies      
Stockholders’ equity:      
Preferred stock, $0.01 par value per share; 5,000,000 shares authorized at June 30, 2017 and December 31, 2016; no shares issued and outstanding at June 30, 2017 and December 31, 2016      
Common stock, par value $0.01 per share; 100,000,000 shares authorized at June 30, 2017 and December 31, 2016; 30,898,405 and 30,353,127 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively. 309     304  
Additional paid-in capital 404,691     383,268  
Accumulated other comprehensive loss (17,380 )   (21,845 )
Accumulated deficit (54,795 )   (60,493 )
Total stockholders’ equity 332,825     301,234  
Total liabilities and stockholders’ equity $ 682,045     $ 651,200  
               


BroadSoft, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (Unaudited)   (Unaudited)
Revenue:              
License software $ 36,533     $ 33,597     $ 64,096     $ 64,506  
Subscription and maintenance support 43,085     36,800     83,586     69,839  
Professional services and other 9,141     11,324     20,746     20,512  
Total revenue 88,759     81,721     168,428     154,857  
Cost of revenue:              
License software 1,481     2,169     3,192     3,898  
Subscription and maintenance support 13,685     11,456     27,083     22,166  
Professional services and other 10,438     8,921     20,351     17,280  
Total cost of revenue 25,604     22,546     50,626     43,344  
Gross profit 63,155     59,175     117,802     111,513  
Operating expenses:              
Sales and marketing 29,615     25,951     57,777     49,274  
Research and development 20,980     20,068     41,731     38,189  
General and administrative 14,082     12,603     27,415     23,916  
Total operating expenses 64,677     58,622     126,923     111,379  
Income (loss) from operations (1,522 )   553     (9,121 )   134  
Other expense:              
Interest expense 4,138     3,926     8,211     7,779  
Interest income (816 )   (664 )   (1,602 )   (1,267 )
Other, net (31 )   185     (223 )   (326 )
Total other expense, net 3,291     3,447     6,386     6,186  
Loss before income taxes (4,813 )   (2,894 )   (15,507 )   (6,052 )
Provision for (benefit from) income taxes (1,830 )   1     (1,988 )   (1,648 )
Net loss $ (2,983 )   $ (2,895 )   $ (13,519 )   $ (4,404 )
Net loss per common share:              
Basic and diluted $ (0.10 )   $ (0.10 )   $ (0.44 )   $ (0.15 )
Weighted average common shares outstanding:              
Basic and diluted 30,752     29,449     30,620     29,295  
Stock-based compensation expense included above:              
Cost of revenue $ 2,240     $ 2,171     $ 4,414     $ 3,893  
Sales and marketing 4,838     4,792     9,364     8,348  
Research and development 3,318     4,020     6,638     7,165  
General and administrative 2,538     2,629     4,911     4,880  
                       


BroadSoft, Inc.
SUMMARY OF CONSOLIDATED CASH FLOW ACTIVITY
(Unaudited)
   
  Six Months Ended
 June 30,
  2017   2016
  (in thousands)
Cash provided by (used in):      
Operating activities $ 26,870     $ 34,191  
Investing activities 13,243     (72,802 )
Financing activities (4,686 )   1,728  
           


BroadSoft, Inc.
BILLINGS (REVENUE PLUS NET CHANGE IN DEFERRED REVENUE)
(Unaudited)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Beginning of period deferred revenue balance $ 102,344     $ 102,725     $ 109,189     $ 111,054  
End of period deferred revenue balance 99,244     107,305     99,244     107,305  
Increase (decrease) in deferred revenue (3,100 )   4,580     (9,945 )   (3,749 )
Revenue 88,759     81,721     168,428     154,857  
Revenue plus net change in deferred revenue $ 85,659     $ 86,301     158,483     151,108  
                           


BroadSoft, Inc.
LICENSE SOFTWARE BILLINGS
(Unaudited)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Beginning of period deferred license software revenue balance $ 15,742     $ 27,853     $ 17,662     $ 33,200  
End of period deferred license software revenue balance 9,856     26,798     9,856     26,798  
Increase (decrease) in deferred license software revenue (5,886 )   (1,055 )   (7,806 )   (6,402 )
License software revenue 36,533     33,597     64,096     64,506  
License software revenue plus net change in deferred license software revenue $ 30,647     $ 32,542     $ 56,290     $ 58,104  
                               


BroadSoft, Inc.
SUBSCRIPTION AND MAINTENANCE SUPPORT BILLINGS
(Unaudited)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Beginning of period deferred subscription and maintenance support revenue balance $ 67,302     $ 57,464     $ 72,559     $ 61,399  
End of period deferred subscription and maintenance support revenue balance 63,060     60,381     63,060     60,381  
Decrease in deferred subscription and maintenance support revenue (4,242 )   2,917     (9,499 )   (1,018 )
Subscription and maintenance support revenue 43,085     36,800     83,586     69,839  
Subscription and maintenance support revenue plus net change in deferred subscription and maintenance support revenue $ 38,843     $ 39,717     $ 74,087     $ 68,821  
                               


BroadSoft, Inc.
PROFESSIONAL SERVICES AND OTHER BILLINGS
(Unaudited)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Beginning of period deferred professional services and other revenue balance $ 19,300     $ 17,408     $ 18,968     $ 16,455  
End of period deferred professional services and other revenue balance 26,328     20,126     26,328     20,126  
Increase in deferred professional services and other revenue 7,028     2,718     7,360     3,671  
Professional services and other revenue 9,141     11,324     20,746     20,512  
Professional services and other revenue plus net change in deferred professional services and other revenue $ 16,169     $ 14,042     $ 28,106     $ 24,183  
                               


BroadSoft, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
       
  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Non-GAAP cost of revenue:              
GAAP license cost of revenue $ 1,481     $ 2,169     $ 3,192     $ 3,898  
(percent of related revenue) 4 %   6 %   5 %   6 %
Less:              
Stock-based compensation expense 100     168     207     326  
Amortization of acquired intangible assets 265     335     770     669  
Non-GAAP license cost of revenue $ 1,116     $ 1,666     $ 2,215     $ 2,903  
(percent of related revenue) 3 %   5 %   3 %   5 %
               
               
GAAP subscription and maintenance support cost of revenue $ 13,685     $ 11,456     $ 27,083     $ 22,166  
(percent of related revenue) 32 %   31 %   32 %   32 %
Less:              
Stock-based compensation expense 988     833     1,953     1,486  
Amortization of acquired intangible assets 1,287     1,183     2,309     2,235  
Non-GAAP subscription and maintenance support cost of revenue $ 11,410     $ 9,440     $ 22,821     $ 18,445  
(percent of related revenue) 26 %   26 %   27 %   26 %
               
               
GAAP professional services and other cost of revenue $ 10,438     $ 8,921     $ 20,351     $ 17,280  
(percent of related revenue) 114 %   79 %   98 %   84 %
Less:              
Stock-based compensation expense 1,152     1,170     2,254     2,081  
Amortization of acquired intangible assets 175     175     350     350  
Non-GAAP professional services and other cost of revenue 9,111     7,576     17,747     14,849  
(percent of related revenue) 100 %   67 %   86 %   72 %
                       


  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands)
Non-GAAP gross profit:              
GAAP gross profit 63,155     59,175     117,802     111,513  
(percent of total revenue) 71 %   72 %   70 %   72 %
Plus:              
Stock-based compensation expense 2,240     2,171     4,414     3,893  
Amortization of acquired intangible assets 1,727     1,693     3,429     3,254  
Non-GAAP gross profit 67,122     63,039     125,645     118,660  
(percent of total revenue) 76 %   77 %   75 %   77 %
               
               
GAAP license gross profit 35,052     31,428     60,904     60,608  
(percent of related revenue) 96 %   94 %   95 %   94 %
Plus:              
Stock-based compensation expense 100     168     207     326  
Amortization of acquired intangible assets 265     335     770     669  
Non-GAAP license gross profit 35,417     31,931     61,881     61,603  
(percent of related revenue) 97 %   95 %   97 %   95 %
               
               
GAAP subscription and maintenance support gross profit 29,400     25,344     56,503     47,673  
(percent of related revenue) 68 %   69 %   68 %   68 %
Plus:              
Stock-based compensation expense 988     833     1,953     1,486  
Amortization of acquired intangible assets 1,287     1,183     2,309     2,235  
Non-GAAP subscription and maintenance support gross profit 31,675     27,360     60,765     51,394  
(percent of related revenue) 74 %   74 %   73 %   74 %
               
               
GAAP professional services and other gross profit (loss) (1,297 )   2,403     395     3,232  
(percent of related revenue) (14 )%   21 %   2 %   16 %
Plus:              
Stock-based compensation expense 1,152     1,170     2,254     2,081  
Amortization of acquired intangible assets 175     175     350     350  
Non-GAAP professional services and other gross profit $ 30     $ 3,748     $ 2,999     $ 5,663  
(percent of related revenue) %   33 %   14 %   28 %
                       


  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016  
  (in thousands)
Non-GAAP income from operations:              
GAAP income (loss) from operations $ (1,522 )   $ 553     $ (9,121 )   $ 134  
(percent of total revenue) (2 )%   1 %   (5 )%   %
Plus:              
Stock-based compensation expense 12,934     13,612     25,327     24,286  
Amortization of acquired intangible assets 1,727     1,693     3,429     3,254  
Non-GAAP income from operations $ 13,139     $ 15,858     $ 19,635     $ 27,674  
(percent of total revenue) 15 %   19 %   12 %   18 %
               
               
GAAP operating expense $ 64,677     $ 58,622     $ 126,923     $ 111,379  
(percent of total revenue) 73 %   72 %   75 %   72 %
Less:              
Stock-based compensation expense 10,694     11,441     20,913     20,393  
Non-GAAP operating expense $ 53,983     $ 47,181     $ 106,010     $ 90,986  
(percent of total revenue) 61 %   58 %   63 %   59 %
               
               
GAAP sales and marketing expense $ 29,615     $ 25,951     $ 57,777     $ 49,274  
(percent of total revenue) 33 %   32 %   34 %   32 %
Less:              
Stock-based compensation expense 4,838     4,792     9,364     8,348  
Non-GAAP sales and marketing expense $ 24,777     $ 21,159     $ 48,413     $ 40,926  
(percent of total revenue) 28 %   26 %   29 %   26 %
               
               
GAAP research and development expense $ 20,980     $ 20,068     $ 41,731     $ 38,189  
(percent of total revenue) 24 %   25 %   25 %   25 %
Less:              
Stock-based compensation expense 3,318     4,020     6,638     7,165  
Non-GAAP research and development expense $ 17,662     $ 16,048     $ 35,093     $ 31,024  
(percent of total revenue) 20 %   20 %   21 %   20 %
               
               
GAAP general and administrative expense $ 14,082     $ 12,603     $ 27,415     $ 23,916  
(percent of total revenue) 16 %   15 %   16 %   15 %
Less:              
Stock-based compensation expense 2,538     2,629     4,911     4,880  
Non-GAAP general and administrative expense $ 11,544     $ 9,974     $ 22,504     $ 19,036  
(percent of total revenue) 13 %   12 %   13 %   12 %
                       


  Three Months Ended
 June 30,
  Six Months Ended
 June 30,
  2017   2016   2017   2016
  (in thousands, except per share data)
Non-GAAP net income and income per share:              
GAAP net loss $ (2,983 )   $ (2,895 )   $ (13,519 )   $ (4,404 )
(percent of total revenue) (3 )%   (4 )%   (8 )%   (3 )%
Adjusted for:              
Stock-based compensation expense 12,934     13,612     25,327     24,286  
Amortization of acquired intangible assets 1,727     1,693     3,429     3,254  
Non-cash interest expense on our convertible senior notes 3,371     3,144     6,682     6,231  
Foreign currency transaction losses (gains) (31 )   185     (223 )   (326 )
Non-cash tax benefit (2,489 )   (786 )   (2,973 )   (3,018 )
Non-GAAP net income 12,529     14,953     18,724     26,023  
(percent of total revenue) 14 %   18 %   11 %   17 %
               
               
GAAP net loss per basic common share $ (0.10 )   $ (0.10 )   $ (0.44 )   $ (0.15 )
Adjusted for:              
Stock-based compensation expense 0.42     0.46     0.83     0.83  
Amortization of acquired intangible assets 0.06     0.06     0.11     0.11  
Non-cash interest expense on our convertible senior notes 0.11     0.11     0.22     0.21  
Foreign currency transaction losses (gains)     0.01     (0.01 )   (0.01 )
Non-cash tax benefit (0.08 )   (0.03 )   (0.10 )   (0.10 )
Non-GAAP net income per basic common share $ 0.41     $ 0.51     $ 0.61     $ 0.89  
               
               
GAAP net loss per diluted common share $ (0.10 )   $ (0.10 )   $ (0.44 )   $ (0.15 )
Adjusted for:              
Stock-based compensation expense 0.41     0.44     0.80     0.81  
Amortization of acquired intangible assets 0.05     0.06     0.11     0.11  
Non-cash interest expense on our convertible senior notes 0.11     0.10     0.21     0.21  
Foreign currency transaction losses (gains)     0.01     (0.01 )   (0.01 )
Non-cash tax benefit (0.08 )   (0.03 )   (0.09 )   (0.10 )
Non-GAAP net income per diluted common share $ 0.40     $ 0.49     $ 0.59     $ 0.87  
                               

* For the three and six months ended June 30, 2017 and 2016, the non-GAAP net income per diluted common share calculation included the dilutive effect of stock-based awards and for the three and six months ended June 30, 2017, the non-GAAP net income per diluted common share calculation included the effect of the premium feature of the convertible senior notes (which, in each case, were not reflected in the corresponding GAAP diluted share calculations, as their effect would have been anti-dilutive as a result of the net losses for these periods). Total diluted weighted average common shares outstanding used for calculating non-GAAP net income per diluted common share were 31,493 thousand and 30,629 thousand for the three months ended June 30, 2017 and 2016 and 31,747 thousand and 30,044 thousand for the six months ended June 30, 2017 and 2016, respectively.

 

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Investor Relations:
Chris Martin
+1-561-404-2130
cmartin@broadsoft.com

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+240-720-9643
nlevestam@broadsoft.com

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