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Press Release

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Informatica Reports Record 2006 Revenues of $325 Million With 21 Percent Annual Growth

Achieves record quarterly revenue and operating income

REDWOOD CITY, Calif., January 25, 2007 - 

Informatica Corporation (NASDAQ: INFA), a leading provider of data integration software, today announced financial results for the fourth quarter and the year ended December 31, 2006

Revenues for the fourth quarter of 2006 were $91.8 million, up 15 percent from the $79.8 million recorded in the fourth quarter of 2005. License revenues for the fourth quarter were $42.9 million, up 10 percent from the $39.0 million recorded in the fourth quarter of 2005. Net income for the fourth quarter, calculated in accordance with U.S. generally accepted accounting principles (GAAP), was $13.9 million or $0.15 per diluted share, versus net income of $13.6 million or $0.14 per diluted share in the fourth quarter of 2005. Results for the fourth quarter of 2006 reflect the impact of share-based compensation as required by Financial Accounting Standards (FAS) 123R, whereas 2005 results exclude these expenses. Non-GAAP net income for the fourth quarter of 2006 was $18.6 million or $0.20 per diluted share, up over 25 percent from $14.7 million or $0.16 per diluted share in the fourth quarter of 2005. Non-GAAP net income excludes charges related to purchased in-process research and development, share-based compensation, facilities restructurings, and the amortization of acquired technology and intangible assets. A reconciliation of GAAP results to non-GAAP results is included below.

For the year ended December 31, 2006, revenues were $324.6 million, up 21 percent from $267.4 million recorded in 2005. License revenues for the year 2006 were $146.1 million, up 22 percent from $120.2 million for the year 2005. GAAP net income for the year ended December 31, 2006 was $36.2 million or $0.39 per diluted share, versus $33.8 million or $0.37 per diluted share for the year ended December 31, 2005. Results for 2006 reflect the impact of share-based compensation as required by Financial Accounting Standards (FAS) 123R, whereas 2005 results exclude these expenses. Non-GAAP net income for the year 2006 was $57.7 million or $0.62 per diluted share, up over 44 percent from $39.3 million or $0.43 per diluted share for the year 2005.

"Guided by our singular mission, we achieved record financial results and gained market share in both the data integration and data quality categories," said Sohaib Abbasi, chairman and CEO of Informatica. "The combination of the highest ever customer demand and most competitive products, positions us strongly to realize the substantial growth opportunity in the data integration market."

Significant milestones achieved since October 2006 include:

  • Signed repeat business with 257 customers. Customers continue to derive considerable value from their investments in Informatica solutions. Repeat customers included AEGON Nederland NV, Bank of America, Barclays Global Investors, California State Automobile Association, CEMEX, Honeywell, IBM Corporation, Linkshare, Manulife Financial, Philips International, Seagate Technology, and Shoppers Drug Mart.
  • Added 91 new customers. Informatica increased its customer base this quarter to 2,749 companies including 59 new Informatica customers and 32 customers added through the Itemfield acquisition. New customers include Alliant Techsystems, BankUnited Financial, Chinatrust Commercial Bank, Danske Bank A/S, Kellogg, Brown & Root, Ministero della Giustizia Italiana, NetWork for Electronic Transfers, Pepco Energy Services, Rollins Inc., and Wendy's International.
  • Acquired Itemfield, a leading data transformation vendor. Itemfield's technology enables near-universal access to unstructured and semi-structured data. The acquisition further extends Informatica's leadership in enterprise data integration with additional cross-enterprise data exchange technology. Industry-specific, data exchange formats supported include SWIFT, NACHA, ACORD, RosettaNet, HIPAA and HL7.
  • Announced latest releases of data quality products. Informatica Data Quality 3.1 and Informatica Data Explorer 5.0. were made generally available in November 2006, delivering enhanced value for customers looking to implement best-in-class data quality processes. These include simple yet powerful business-oriented user interfaces; new capabilities that increase user and developer productivity; and end-to-end integration with the Informatica PowerCenter data integration platform, enabling data profiling and cleansing to become integral components of the overall data integration lifecycle.
  • Informatica extends global education services reach. Informatica, NIIT, Softtek and Visionary Integration Professionals entered into new product training partnerships in India, Latin America and U.S. to deliver hands-on training for Informatica data integration products. In teaming with local companies in key geographies, Informatica is making it easier and more cost-effective for customers and systems integrators to leverage expert data integration instruction.
  • Recognized as a "Leader" in first DI tools Magic Quadrant. Informatica is the only independent data integration software company positioned on the completeness of vision and ability to execute axes in the "leaders" quadrant. The positioning reflects the market response to Informatica's singular focus on data integration, consistent track record of innovation that genuinely benefits customers, and commitment to a positive customer service and support experience.

Conference Call and Webcast
Informatica will be discussing its fourth quarter and annual 2006 results on a conference call today beginning at 2:00 p.m. PDT. A live Webcast of the conference call will be available at www.informatica.com/investor . A replay of the call will also be available by dialing 617-801-6888, reservation number 54718905.

About Informatica
Informatica Corporation (NASDAQ: INFA) is a leading provider of enterprise data integration software and services. Using Informatica products, companies gain greater business value by integrating all their information assets. More than 2,700 companies worldwide rely on Informatica to reduce the cost and expedite the time to address data integration needs of any complexity and scale. For more information, call 650-385-5000 (1-800-653-3871 in the U.S.), or visit http://www.informatica.com/ .

###

GAAP to Non-GAAP Results
(in thousands, except per share data and percentages)
(unaudited)



Three Months Ended
December 31,

Years Ended
December 31,


2006
2005
2006
2005









GAAP Net income
$ 13,925
$13,553
$36,206

$33,804










Plus:








Amortization of acquired technology
573
226
2,118
922

Amortization of intangible assets
199
47
653
188

Facilities restructuring charges
(174)
781
3,212
3,683

Purchased in-process research and development


-
-
1,340
-

Share-based payments
4,123
49
14,138
723



















Non-GAAP Net income
$ 18,646
$14,656
$57,667
$39,320




















Three Months Ended
December 31,

Years Ended
December 31,


2006
2005
2006
2005
Diluted net income per share:
















Diluted GAAP Net income per share
$ 0.15
$ 0.14
$ 0.39
$ 0.37









Plus:








Amortization of acquired technology
0.01
0.01
0.02
0.01

Amortization of intangible assets
-
-
0.01
-

Facilities restructuring charges
-
0.01
0.04
0.04

Purchased in-process research and development
-
-
0.01
-

Share-based payments
0.04
-
0.15
0.01









Diluted Non-GAAP Net income per share
$ 0.20
$ 0.16
$ 0.62
$ 0.43









Shares used in computing diluted GAAP Net income per share
103,176
94,163
92,942
92,083
Shares used in computing diluted Non-GAAP Net income per share
103,692
94,163
93,679
92,083

Non-GAAP Financial Information
To supplement the company's condensed consolidated financial statements presented on a GAAP basis, Informatica uses non-GAAP financial measures of net income and net income per share. These measures are adjusted to exclude the charges and expenses discussed above. The company believes the disclosure of such non-GAAP financial measures is appropriate to enhance an overall understanding of its historical financial performance. These adjustments to the company's GAAP results are made with the intent of providing both management and investors a more complete understanding of the company's underlying operational results, trends, and marketplace performance. Informatica believes that the inclusion of these non-GAAP financial measures provides consistency and comparability with its historical financial results, as well as comparability to similar companies in the company's industry, many of which present similar non-GAAP financial measures to investors. In addition, these non-GAAP financial measures are among the primary indicators management uses as a basis for its planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income or net income per share prepared in accordance with GAAP in the U.S.

Safe Harbor
This press release contains forward-looking statements relating to our opportunity for growth in the data integration market, potential impact of our acquisition of Itemfield and efforts being conducted with strategic training partners. Such statements involve risks and uncertainties, and actual results may differ materially from the results described in this press release. The potential risks and uncertainties that could cause actual results to differ include, among others, risks related to (1) competition with larger companies that have longer operating histories and greater financial, technical, marketing, and other resources; (2) uncertainty in the state of IT spending and the continued growth in the market for data integration solutions in general; (3) successful integration of Itemfield's technology and its employees into Informatica; and (4) lack of control regarding our strategic partners' devotion of adequate resources to promote, sell, implement, and support our products, as well as those risks and uncertainties included under the caption "Risk Factors" in Informatica's report on Form 10-Q for the quarter ended September 30, 2006, which is on file with the SEC and is available on the company's investor relations website at http://www.informatica.com/ . All information provided in this release is as of January 25, 2007, and Informatica undertakes no duty to update this information.

Note: Informatica, Informatica Data Quality, Informatica Data Explorer and PowerCenter are registered trademarks of Informatica Corporation in the United States and in jurisdictions throughout the world. All other company and product names may be trade names or trademarks of their respective owners.