- Double-Digit Growth in Operating Income and EPS Driven by
Further Significant Expansion in Cloud Gross Margin
- Constant Currency Year-over-Year Total Revenue Growth of 14%
and 27% in Cloud Revenue
- Company Announces New Share Buyback Program of $250
million
NICE (NASDAQ: NICE) today announced results for the third
quarter ended September 30, 2022.
Third Quarter 2022 Financial Highlights
GAAP
Non-GAAP
Total revenue of $554.7 million, growth of
12.3% year-over-year
Total revenue of $554.7 million, growth of
12.2% year-over-year
Cloud revenue of $330.5 million, growth of
26.2% year-over-year
Cloud revenue of $330.5 million, growth of
26.0% year-over-year
Cloud gross margin of 64.1% compared to
59.6% last year
Cloud gross margin of 70.4% compared to
67.1% last year
Total gross margin of 69.2% compared to
67.4% last year
Total gross margin of 73.5% compared to
72.3% last year
Operating income of $90.3 million compared
to $67.6 million last year, growth of 33.6% year-over-year
Operating income of $159.3 million
compared to $140.0 million last year, growth of 13.8%
year-over-year
Operating margin of 16.3% compared to
13.7% last year
Operating margin of 28.7%, compared to
28.3% last year
Diluted EPS of $1.07 versus $0.75 last
year, growth of 42.7%
Diluted EPS of $1.92 versus $1.68 last
year, growth of 14.3%
“We continue to thrive and are pushing full steam ahead as
evidenced by another quarter of solid results across the board,”
said Barak Eilam, CEO NICE. “We reported double-digit growth in
total revenue driven by another excellent quarter in cloud revenue,
which grew 27% at constant currency. We delivered another quarter
of strong profitability, and we expect to continue to deliver
profitable growth with operating income and earnings per share
growing at double-digits moving forward.”
Mr. Eilam continued, “We are witnessing a dramatic shift in the
enterprise software landscape that is creating massive
opportunities for some, and unbridgeable gaps for others. At NICE,
we see great opportunities accentuated by the mission critical
nature of our solutions used by thousands of customers, and by
being the go-to market leader for AI driven automation solutions
that are critical for enterprises to overcome shortages and costs
of labor in the current environment. Moreover, we have, by far, the
strongest financial profile in our space, including a substantial
net cash position. Our long-standing investment in innovation,
which continues to deliver the most complete and highly
differentiated platforms in our industry, along with our seasoned
and committed leadership team, empowers us to continue to outpace
the market.”
GAAP Financial Highlights for the Third
Quarter Ended September 30:
Revenues: Third quarter 2022 total revenues increased
12.3% to $554.7 million compared to $493.8 million for the third
quarter of 2021.
Gross Profit: Third quarter 2022 gross profit was $383.9
million compared to $333.0 million for the third quarter of 2021.
Third quarter 2022 gross margin was 69.2% compared to 67.4% for the
third quarter of 2021.
Operating Income: Third quarter 2022 operating income was
$90.3 million compared to $67.6 million for the third quarter of
2021. Third quarter 2022 operating margin was 16.3% compared to
13.7% for the third quarter of 2021.
Net Income: Third quarter 2022 net income was $71.2
million compared to $50.7 million for the third quarter of 2021.
Third quarter 2022 net income margin was 12.8% compared to 10.3%
for the third quarter of 2021.
Fully Diluted Earnings Per Share: Fully diluted earnings
per share for the third quarter of 2022 increased 42.7% to $1.07
compared to $0.75 in the third quarter of 2021.
Operating Cash Flow and Cash Balance: Third quarter 2022
operating cash flow was $94.3 million.
In the third quarter, $22.5 million was used for share
repurchases. As of September 30, 2022, total cash and cash
equivalents, and short-term investments were $1,461.2 million. Our
debt, net of a hedge instrument, was $541.2 million, resulting in
net cash and investments of $920.0 million.
Non-GAAP Financial Highlights for the
Third Quarter Ended September 30:
Revenues: Third quarter 2022 total revenues increased
12.2% (13.8% at constant currency) to $554.7 million compared to
$494.4 million for the third quarter of 2021.
Gross Profit: Third quarter 2022 Non-GAAP gross profit
increased to $408.0 million compared to $357.5 million for the
third quarter of 2021. Third quarter 2022 Non-GAAP gross margin was
73.5% compared to 72.3% for the third quarter of 2021.
Operating Income: Third quarter 2022 Non-GAAP operating
income increased to $159.3 million compared to $140.0 million for
the third quarter of 2021. Third quarter 2022 Non-GAAP operating
margin was 28.7% compared to 28.3% for the third quarter of
2021.
Net Income: Third quarter 2022 Non-GAAP net income
increased to $127.8 million compared to $112.6 million for the
third quarter of 2021. Third quarter 2022 Non-GAAP net income
margin totaled 23.0% compared to 22.8% for the third quarter of
2021.
Fully Diluted Earnings Per Share: Third quarter 2022
Non-GAAP fully diluted earnings per share increased 14.3% (16.7% at
constant currency) to $1.92 compared to $1.68 for the third quarter
of 2021.
Full Year 2022 Guidance:
The Company is raising its 2022 Non-GAAP full year total revenue
and fully diluted earnings per share guidance based on constant
currency. The Company is providing additional disclosure of full
year guidance in constant currency resulting from stronger than
expected foreign exchange headwinds.
Excluding these headwinds, full year 2022 Non-GAAP total revenue
guidance would be $15 million higher and 2022 Non-GAAP fully
diluted earnings per share would be $0.04 higher.
The following table summarizes our guidance for the full-year
2022:
Full-Year 2022 Non-GAAP
Guidance*
Range Amount
Year/Year Growth at Midpoint
Constant Currency Year/Year
Growth at Midpoint
Revenue ($ in millions)
$2,168 - $2,188
13.1%
13.8%
EPS
$7.40 - $7.60
15.0%
15.6%
*The impact of foreign exchange for the fourth quarter is based
on September 2022 foreign exchange rates in comparison with average
exchange rates in Q4/2021.
Quarterly Results Conference Call
NICE management will host its earnings conference call today
November 10, 2022, at 8:30 AM ET, 13:30 GMT, 15:30 Israel, to
discuss the results and the company's outlook. To participate in
the call, please dial into the following numbers: United States
1-877-407-4018 or +1-201-689-8471, United Kingdom 0-800-756-3429,
Israel 1-809-406-247. The call will be webcast live on the
Company’s website at
https://www.nice.com/investor-relations/upcoming-event.
Explanation of Non-GAAP measures
Non-GAAP financial measures are included in this press release.
Non-GAAP financial measures consist of GAAP financial measures
adjusted to exclude share-based compensation, amortization of
acquired intangible assets, acquisition related expenses,
amortization of discount on debt and loss from extinguishment of
debt and the tax effect of the Non-GAAP adjustments. FASB issued an
accounting update, ASU2021-08, Business Combinations, in the fourth
quarter of 2021. The amendments in ASU 2021-08 require acquiring
entities to apply Topic 606 to recognize and measure contract
assets and contract liabilities in a business combination. Before
this guidance and through December 31, 2020, business combination
accounting rules required recognizing a legal performance
obligation related to a revenue arrangement of an acquired entity
as a liability. The amount assigned to such liability was based on
its fair value at the date of acquisition. Effective January 1,
2021, the Company early adopted the new guidance retroactively to
the start of the year. The Company has applied the new guidance
retrospectively to all business combinations for which the
acquisition date occurred on or after January 1, 2021, and
therefore comparative financials for periods during 2021 have been
adjusted accordingly to recognize the full amount of revenue
associated with acquisitions. The Company believes that these
Non-GAAP financial measures, used in conjunction with the
corresponding GAAP measures, provide investors with useful
supplemental information about the financial performance of our
business. We believe Non-GAAP financial measures are useful to
investors as a measure of the ongoing performance of our business.
Our management regularly uses our supplemental Non-GAAP financial
measures internally to understand, manage and evaluate our business
and to make financial, strategic and operating decisions. These
Non-GAAP measures are among the primary factors management uses in
planning for and forecasting future periods. Our Non-GAAP financial
measures are not meant to be considered in isolation or as a
substitute for comparable GAAP measures and should be read only in
conjunction with our consolidated financial statements prepared in
accordance with GAAP. These Non-GAAP financial measures may differ
materially from the Non-GAAP financial measures used by other
companies. Reconciliation between results on a GAAP and Non-GAAP
basis is provided in a table immediately following the Consolidated
Statements of Income. The Company provides guidance only on a
Non-GAAP basis. A reconciliation of guidance from a GAAP to
Non-GAAP basis is not available due to the unpredictability and
uncertainty associated with future events that would be reported in
GAAP results and would require adjustments between GAAP and
Non-GAAP financial measures, including the impact of future
possible business acquisitions. Accordingly, a reconciliation of
the guidance based on Non-GAAP financial measures to corresponding
GAAP financial measures for future periods is not available without
unreasonable effort.
Explanation of Constant Currency
NICE presents constant currency information to provide a
framework for assessing how our underlying businesses performed
excluding the effect of foreign currency rate fluctuations. To
present this information, current results for transactions in
currencies other than United States dollars are converted into
United States dollars using the average exchange rates from the
comparative period rather than the actual exchange rates in effect
during the current period. Future expected results for transactions
in currencies other than United States dollars are converted into
United States dollars using the exchange rates in effect in the
last month of the reporting period. NICE has provided this
financial information to aid investors in better understanding our
performance. These constant currency financial measures presented
in this release should not be considered as a substitute for, or
superior to, the measures of financial performance prepared in
accordance with GAAP.
About NICE
NICE (Nasdaq: NICE) is the worldwide leading provider of both
cloud and on-premises enterprise software solutions that empower
organizations to make smarter decisions based on advanced analytics
of structured and unstructured data. NICE helps organizations of
all sizes deliver better customer service, ensure compliance,
combat fraud and safeguard citizens. Over 25,000 organizations in
more than 150 countries, including over 85 of the Fortune 100
companies, are using NICE solutions. www.nice.com.
Trademark Note: NICE and the NICE logo are trademarks or
registered trademarks of NICE. All other marks are trademarks of
their respective owners. For a full list of NICE' marks, please
see: http://www.nice.com/nice-trademarks.
Forward-Looking Statements
This press release contains forward-looking statements as that
term is defined in the Private Securities Litigation Reform Act of
1995. In some cases, forward-looking statements may be identified
by words such as “believe,” “expect,” “seek,” “may,” “will,”
“intend,” “should,” “project,” “anticipate,” “plan,” and similar
expressions. Forward-looking statements are based on the current
beliefs, expectations and assumptions of the Company’s management
regarding the future of the Company’s business, future plans and
strategies, projections, anticipated events and trends, the economy
and other future conditions. Examples of forward-looking statements
include guidance regarding the Company’s revenue and earnings and
the growth of our cloud, analytics and artificial intelligence
business.
Forward looking statements are inherently subject to significant
economic, competitive and other uncertainties and contingencies,
many of which are beyond the control of management. The Company
cautions that these statements are not guarantees of future
performance, and investors should not place undue reliance on them.
There are or will be important known and unknown factors and
uncertainties that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements.
These factors, include, but are not limited to, risks associated
with changes in economic and business conditions, competition,
successful execution of the Company’s growth strategy, success and
growth of the Company’s cloud Software-as-a-Service business,
difficulties in making additional acquisitions or effectively
integrating acquired operations, products, technologies and
personnel, the Company’s dependency on third-party cloud computing
platform providers, hosting facilities and service partners,
rapidly changing technology, cyber security attacks or other
security breaches against the Company, privacy concerns and
legislation impacting the Company’s business, changes in currency
exchange rates and interest rates, the effects of additional tax
liabilities resulting from our global operations, uncertainty
related to COVID-19 and various other factors and uncertainties
discussed in our filings with the U.S. Securities and Exchange
Commission (the “SEC”).
You are encouraged to carefully review the section entitled
“Risk Factors” in our latest Annual Report on Form 20-F and our
other filings with the SEC for additional information regarding
these and other factors and uncertainties that could affect our
future performance. The forward-looking statements contained in
this press release speak only as of the date hereof, and the
Company undertakes no obligation to update or revise them, whether
as a result of new information, future developments or otherwise,
except as required by law.
NICE LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
U.S. dollars in thousands
September 30,
December 31,
2022
2021
Unaudited
Audited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
423,032
$
378,656
Short-term investments
1,038,160
1,046,095
Trade receivables
469,230
395,583
Debt hedge option
118,694
292,940
Prepaid expenses and other current
assets
192,105
184,604
Total current assets
2,241,221
2,297,878
LONG-TERM ASSETS:
Property and equipment, net
157,992
145,654
Deferred tax assets
83,457
55,246
Other intangible assets, net
211,200
295,378
Operating lease right-of-use assets
105,317
85,055
Goodwill
1,577,871
1,606,756
Prepaid expenses and other long-term
assets
246,110
224,445
Total long-term assets
2,381,947
2,412,534
TOTAL ASSETS
$
4,623,168
$
4,710,412
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES:
Trade payables
$
37,373
$
36,121
Deferred revenues and advances from
customers
329,203
330,459
Current maturities of operating leases
14,531
19,514
Debt
204,943
395,946
Accrued expenses and other liabilities
477,033
487,547
Total current liabilities
1,063,083
1,269,587
LONG-TERM LIABILITIES:
Deferred revenues and advances from
customers
55,142
66,606
Operating leases
100,757
81,185
Deferred tax liabilities
4,165
7,429
Debt
454,954
429,267
Other long-term liabilities
17,067
18,379
Total long-term liabilities
632,085
602,866
SHAREHOLDERS' EQUITY
Nice Ltd's equity
2,915,076
2,825,085
Non-controlling interests
12,924
12,874
Total shareholders' equity
2,928,000
2,837,959
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY
$
4,623,168
$
4,710,412
NICE LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
INCOME
U.S. dollars in thousands (except per
share amounts)
Quarter ended
Year to date
September 30,
September 30,
2022
2021
2022
2021
Unaudited
Unaudited
Unaudited
Unaudited
Revenue:
Cloud
$
330,487
$
261,823
$
936,472
$
733,424
Services
165,202
164,783
488,909
493,707
Product
59,035
67,223
187,353
178,546
Total revenue
554,724
493,829
1,612,734
1,405,677
Cost of revenue:
Cloud
118,706
105,790
345,497
298,544
Services
45,697
47,980
137,598
143,796
Product
6,379
7,073
19,613
16,872
Total cost of revenue
170,782
160,843
502,708
459,212
Gross profit
383,942
332,986
1,110,026
946,465
Operating expenses:
Research and development, net
74,048
74,482
224,108
195,855
Selling and marketing
158,608
131,776
461,636
386,530
General and administrative
60,991
59,134
176,933
165,239
Total operating expenses
293,647
265,392
862,677
747,624
Operating income
90,295
67,594
247,349
198,841
Financial and other expense/(income),
net
(596
)
3,138
(1,032
)
15,594
Income before tax
90,891
64,456
248,381
183,247
Taxes on income
19,645
13,803
53,622
35,186
Net income
$
71,246
$
50,653
$
194,759
$
148,061
Earnings per share:
Basic
$
1.12
$
0.80
$
3.05
$
2.35
Diluted
$
1.07
$
0.75
$
2.93
$
2.22
Weighted average shares outstanding:
Basic
63,739
63,182
63,763
63,125
Diluted
66,446
67,101
66,524
66,779
NICE LTD. AND SUBSIDIARIES
CONSOLIDATED CASH FLOW
STATEMENTS
U.S. dollars in thousands
Quarter ended
Year to date
September 30,
September 30,
2022
2021
2022
2021
Unaudited
Unaudited
Unaudited
Unaudited
Operating
Activities
Net income
$
71,246
$
50,653
$
194,759
$
148,061
Adjustments to reconcile net income to net
cash provided by operating activities
Depreciation and amortization
42,594
45,907
129,077
136,742
Stock based compensation
42,396
40,628
133,689
103,062
Amortization of premium and discount and
accrued interest on marketable securities
2,090
4,015
7,162
10,012
Deferred taxes, net
(11,582
)
(13,137
)
(23,626
)
(30,202
)
Changes in operating assets and
liabilities:
Trade Receivables
(14,780
)
(23,161
)
(85,635
)
(45,628
)
Prepaid expenses and other assets
137
(11,255
)
(40,273
)
(36,218
)
Trade payables
(22,789
)
(14,435
)
1,643
(9,643
)
Accrued expenses and other current
liabilities
24,048
35,030
(10,283
)
22,601
Operating lease right-of-use assets
3,494
3,394
16,814
12,317
Deferred revenue
(38,963
)
(14,218
)
(2,332
)
33,046
Operating lease liabilities
(5,057
)
(4,330
)
(22,488
)
(14,805
)
Amortization of discount on debt
1,143
3,911
3,431
11,523
Loss from extinguishment of debt
1
778
1,206
8,076
Other
289
(302
)
(135
)
214
Net cash provided by operating
activities
94,267
103,478
303,009
349,158
Investing
Activities
Purchase of property and equipment
(6,067
)
(8,153
)
(20,952
)
(21,113
)
Purchase of Investments
(143,655
)
(58,148
)
(365,457
)
(281,896
)
Proceeds from Investments
140,814
58,860
322,404
225,964
Capitalization of software development
costs
(13,427
)
(10,712
)
(37,171
)
(31,987
)
Other
-
-
276
-
Payments for business and asset
acquisitions, net of cash acquired
-
(14,302
)
-
(143,164
)
Net cash used in investing activities
(22,335
)
(32,455
)
(100,900
)
(252,196
)
Financing
Activities
Proceeds from issuance of shares upon
exercise of share options
151
1,109
424
3,484
Purchase of treasury shares
(22,489
)
(4,346
)
(120,401
)
(48,908
)
Dividends paid to noncontrolling
interest
-
-
(376
)
(801
)
Repayment of debt
(18
)
(10,501
)
(20,128
)
(93,315
)
Net cash provided by/(used in) financing
activities
(22,356
)
(13,738
)
(140,481
)
(139,540
)
Effect of exchange rates on cash and cash
equivalents
(5,663
)
(3,041
)
(12,302
)
(1,993
)
Net change in cash, cash equivalents and
restricted cash
43,913
54,244
49,326
(44,571
)
Cash, cash equivalents and restricted
cash, beginning of period
$
384,069
$
343,452
$
378,656
$
442,267
Cash, cash equivalents and restricted
cash, end of period
$
427,982
$
397,696
$
427,982
$
397,696
NICE LTD. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP
RESULTS
U.S. dollars in thousands (except per
share amounts)
Quarter ended
Year to date
September 30,
September 30,
2022
2021
2022
2021
GAAP revenues
$
554,724
$
493,829
$
1,612,734
$
1,405,677
Valuation adjustment on acquired deferred
cloud revenue
-
570
-
4,372
Valuation adjustment on acquired deferred
services revenue
-
10
-
175
Non-GAAP revenues
$
554,724
$
494,409
$
1,612,734
$
1,410,224
GAAP cost of revenue
$
170,782
$
160,843
$
502,708
$
459,212
Amortization of acquired intangible assets
on cost of cloud
(18,564
)
(17,493
)
(55,851
)
(53,220
)
Amortization of acquired intangible assets
on cost of services
-
(1,107
)
(377
)
(3,558
)
Amortization of acquired intangible assets
on cost of product
(242
)
(283
)
(776
)
(853
)
Valuation adjustment on acquired deferred
cost of cloud
13
25
41
76
Cost of cloud revenue adjustment (1)
(2,319
)
(2,117
)
(6,389
)
(5,287
)
Cost of services revenue adjustment
(1)
(2,778
)
(2,835
)
(8,264
)
(6,916
)
Cost of product revenue adjustment (1)
(135
)
(159
)
(401
)
(410
)
Non-GAAP cost of revenue
$
146,757
$
136,874
$
430,691
$
389,044
GAAP gross profit
$
383,942
$
332,986
$
1,110,026
$
946,465
Gross profit adjustments
24,025
24,549
72,017
74,715
Non-GAAP gross profit
$
407,967
$
357,535
$
1,182,043
$
1,021,180
GAAP operating expenses
$
293,647
$
265,392
$
862,677
$
747,624
Research and development (1)
(7,424
)
(7,073
)
(23,825
)
(15,241
)
Sales and marketing (1)
(13,723
)
(9,707
)
(43,121
)
(27,526
)
General and administrative (1)
(16,505
)
(19,998
)
(52,991
)
(51,373
)
Amortization of acquired intangible
assets
(7,379
)
(11,109
)
(23,153
)
(30,769
)
Valuation adjustment on acquired deferred
commission
48
53
153
161
Non-GAAP operating expenses
$
248,664
$
217,558
$
719,740
$
622,876
GAAP financial and other expense (income),
net
$
(596
)
$
3,138
$
(1,032
)
$
15,594
Amortization of discount on debt and loss
from extinguishment of debt
(1,144
)
(4,469
)
(4,637
)
(19,406
)
Non-GAAP financial and other income,
net
$
(1,740
)
$
(1,331
)
$
(5,669
)
$
(3,812
)
GAAP taxes on income
$
19,645
$
13,803
$
53,622
$
35,186
Tax adjustments re non-GAAP
adjustments
13,598
14,916
42,860
47,259
Non-GAAP taxes on income
$
33,243
$
28,719
$
96,482
$
82,445
GAAP net income
$
71,246
$
50,653
$
194,759
$
148,061
Valuation adjustment on acquired deferred
revenue
-
580
-
4,547
Valuation adjustment on acquired deferred
cost of cloud revenue
(13
)
(25
)
(41
)
(76
)
Amortization of acquired intangible
assets
26,185
29,992
80,157
88,400
Valuation adjustment on acquired deferred
commission
(48
)
(53
)
(153
)
(161
)
Share-based compensation (1)
42,884
40,934
134,991
103,891
Acquisition related expenses (2)
-
955
-
2,862
Amortization of discount on debt and loss
from extinguishment of debt
1,144
4,469
4,637
19,406
Tax adjustments re non-GAAP
adjustments
(13,598
)
(14,916
)
(42,860
)
(47,259
)
Non-GAAP net income
$
127,800
$
112,589
$
371,490
$
319,671
GAAP diluted earnings per share
$
1.07
$
0.75
$
2.93
$
2.22
Non-GAAP diluted earnings per share
$
1.92
$
1.68
$
5.58
$
4.79
Shares used in computing GAAP diluted
earnings per share
66,446
67,101
66,524
66,779
Shares used in computing non-GAAP diluted
earnings per share
66,446
67,101
66,524
66,779
NICE LTD. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP
RESULTS (continued)
U.S. dollars in thousands
(1)
Share-based
Compensation
Quarter ended
Year to date
September 30,
September 30,
2022
2021
2022
2021
Cost of cloud revenue
$
2,319
$
2,117
$
6,389
$
5,287
Cost of services revenue
2,778
2,835
8,264
6,916
Cost of product revenue
135
159
401
410
Research and development
7,424
7,073
23,825
15,241
Sales and marketing
13,723
9,707
43,121
27,526
General and administrative
16,505
19,043
52,991
48,511
$
42,884
$
40,934
$
134,991
$
103,891
(2)
Acquisition
related expenses
Quarter ended
Year to date
September 30,
September 30,
2022
2021
2022
2021
Research and development
-
-
-
-
Sales and marketing
-
-
-
-
General and administrative
-
955
-
2,862
-
955
-
2,862
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221110005514/en/
Investors Marty Cohen, +1 551 256 5354, ET, ir@nice.com
Omri Arens, +972 3 763-0127, CET, ir@nice.com
Media Contact Chris Irwin-Dudek, +1 (551) 256-5140,
Chris.Irwin-Dudek@nice.com
NICE (NASDAQ:NICE)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
NICE (NASDAQ:NICE)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024