Informatica Corporation (NASDAQ: INFA), the world’s number one independent provider of data integration software, today announced financial results for the second quarter ended June 30, 2010.
“Our record Q2 results underscore the increasingly strategic role of Informatica for our customers and partners,” said Sohaib Abbasi, chairman and CEO, Informatica. “Despite the uneven economic recovery, Informatica is increasingly benefiting from our strongest-ever product portfolio and the team’s exceptional operational discipline with record results in each of the major geographic regions.”
Financial Highlights for the Second Quarter Ended June 30, 2010
Total revenues for the second quarter of 2010 were $155.7 million, an increase of 33 percent from $117.3 million recorded in the second quarter of 2009. License revenues were $70.0 million, an increase of 44 percent from $48.7 million recorded in the second quarter of 2009.
Income from operations for the second quarter, calculated in accordance with U.S. generally accepted accounting principles (GAAP), was $25.5 million, up 49 percent from $17.1 million in the second quarter of 2009.
GAAP net income for the second quarter of 2010 was $17.4 million or $0.17 per diluted share, up over 30 percent from $12.0 million or $0.13 per diluted share in the second quarter of 2009. For the three month periods ended June 30, 2010 and June 30, 2009, earnings per diluted share is calculated on an “if converted” basis, including the add-back of $1.0 million of interest and convertible notes issuance cost amortization, net of applicable income taxes.
Non-GAAP income from operations for the second quarter of 2010 was $37.3 million, up 41 percent from $26.5 million in the second quarter of 2009. Non-GAAP net income for the second quarter of 2010 was $25.8 million or $0.25 per diluted share, up over 31 percent from $18.7 million or $0.19 per diluted share in the second quarter of 2009. Non-GAAP income from operations and non-GAAP net income exclude charges and tax benefits related to the amortization of acquired technology and intangible assets, facilities restructurings, acquisitions and other expenses, investment gains and stock compensation. A reconciliation of GAAP results to non-GAAP results is included below.
For the six month period ended June 30, 2010, revenues were $290.8 million, an increase of 28 percent from the $226.4 million recorded for the first six months of 2009. License revenues for the first six months of 2010 were $125.1 million, up 35 percent from $92.8 million in the first six months of 2009. GAAP net income for the first six months of 2010 was $29.2 million or $0.29 per diluted share, up over 16 percent from $23.0 million or $0.25 per diluted share in the first six months of 2009. Non-GAAP net income for the first six months of 2010 was $46.8 million or $0.45 per diluted share, up over 21 percent from $35.8 million or $0.37 per diluted share in the first six months of 2009. For the six month periods ended June 30, 2010 and June 30, 2009, earnings per diluted share is calculated on an “if converted” basis, including the add-back of $1.9 and $2.1 million, respectively, of interest and convertible notes issuance cost amortization, net of applicable income taxes.
Additional Highlights Achieved Since April 2010:
Conference Call and Webcast
Informatica will discuss its second quarter 2010 results on a conference call today beginning at 2:00 p.m. PDT. A live webcast of the conference call will be available at http://www.informatica.com/investor. A replay of the call will also be available by dialing 706-645-9291, reservation number 67178316.
Non-GAAP Financial Information
To supplement Informatica’s condensed consolidated financial statements prepared and presented on a GAAP basis, Informatica uses non-GAAP financial measures of income from operations, net income and net income per share. These measures are adjusted from income from operations, net income or net income per share prepared in accordance with GAAP to exclude the charges and expenses discussed above. The presentation of these non-GAAP financial measures are not meant to be considered in isolation or as a substitute for, or superior to, income from operations, net income or net income per share prepared in accordance with GAAP.
Informatica believes the disclosure of such non-GAAP financial measures is appropriate to enhance an overall understanding of its financial performance, its financial and operational decision making, and as a means to evaluate period to period comparisons. These adjustments to the Company’s GAAP results are made with the intent of providing both management and investors a more complete understanding of Informatica’s performance, by excluding certain expenses and expenditures such as non-cash charges and discrete charges that are infrequent in nature, such as charges related to acquisitions, that may not be indicative of its underlying operating results. In addition, Informatica believes these non-GAAP financial measures are useful to investors because they allow for greater transparency into the indicators used by management as a basis for its financial and operational decision making. Informatica believes that the disclosure of these non-GAAP financial measures provides consistency and comparability of its recent financial results with its historical financial results, as well as to the operating results of similar companies in Informatica’s industry, many of which present similar non-GAAP financial measures to investors. As an example, Informatica believes that it enhances comparability with similar companies’ operating results by excluding stock compensation in its non-GAAP financial measures because of the different types of stock-based awards that companies may grant and because ASC 718 allows companies to use different valuation methodologies and subjective assumptions. In addition, Informatica believes that both management and investors benefit from referring to these non-GAAP financial measures when planning, analyzing and forecasting future periods.
There are a number of limitations related to these non-GAAP financial measures: (1) the non-GAAP measures exclude some costs that are recurring, particularly stock compensation, and we believe that stock compensation will continue to be a significant recurring expense for the foreseeable future; because stock compensation is an important part of our employees’ compensation, such payments can impact their performance; and (2) the items we exclude in our non-GAAP measures may differ from the components our peer companies exclude when they report their non-GAAP measures. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP measures and evaluating non-GAAP measures together with the corresponding measures calculated in accordance with GAAP.
Forward Looking Statements
This press release contains forward-looking statements relating to the benefits of our product portfolio and operational results. 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; and (2) uncertainty in the state of IT spending and the continued growth in the market for data integration solutions in general. Additional risks and uncertainties are included under the caption “Risk Factors” in Informatica’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010, which has been filed with the SEC and is available on our investor relations website at http://www.informatica.com. All information provided in this release is as of July 22, 2010 and Informatica undertakes no duty to update this information.
Informatica Corporation (NASDAQ: INFA) is the world’s number one independent provider of data integration software. Organizations around the world gain a competitive advantage in today’s global information economy with timely, relevant and trustworthy data for their top business imperatives. More than 4,100 enterprises worldwide rely on Informatica to access, integrate and trust their information assets held in the traditional enterprise, off premise and in the Cloud. For more information, call +1 650-385-5000 (1-800-653-3871 in the U.S.), or visit www.informatica.com.
Note: Informatica, PowerCenter, Informatica Master Data Management, Informatica Information Lifecycle Management, Informatica Marketplace, and Informatica Cloud are trademarks or 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.