Proofpoint, Inc.
Jul 27, 2017

Proofpoint Announces Second Quarter 2017 Financial Results

SUNNYVALE, Calif., July 27, 2017 (GLOBE NEWSWIRE) -- Proofpoint, Inc. (NASDAQ:PFPT), a leading next-generation security and compliance company, today announced financial results for the second quarter ended June 30, 2017.

"Our strong second quarter results were driven by the rapidly evolving threat landscape and the demand for Proofpoint's advanced threat solutions," stated Gary Steele, chief executive officer of Proofpoint.  "During the quarter, the company also benefitted from the transition to the cloud, ongoing traction from new emerging products, robust new and add-on activity, and consistently high renewal rates.  Looking forward, the broad demand drivers benefitting the company remain firmly in place which we believe position Proofpoint to maintain the momentum and gain share in the over $10 billion total addressable market."

Second Quarter 2017 Financial Highlights

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial tables included in this press release.  An explanation of these measures and how they are calculated are also included below under the heading "Non-GAAP Financial Measures."

"We were pleased with our ability to exceed expectations during the second quarter, evidenced by revenue and billings growth of 36% and 45%, respectively, as well as strong free cash flow generation," stated Paul Auvil, chief financial officer of Proofpoint.  "Our overall financial results highlight the ongoing leverage we are seeing in the business while at the same time driving top line growth."

Second Quarter and Recent Business Highlights:

Financial Outlook

As of July 27, 2017, Proofpoint is providing guidance for its third quarter and increasing full year 2017 guidance as follows:

Quarterly Conference Call

Proofpoint will host a conference call today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to review the company's financial results for the second quarter ended June 30, 2017.  To access this call, dial (877) 852-6573 for the U.S. or Canada and (719) 325-2326 for international callers with conference ID #7942677.  A live webcast of the conference call will be accessible from the Investors section of Proofpoint's website at investors.proofpoint.com, and a recording will be archived and accessible at investors.proofpoint.com.  An audio replay of this conference call will also be available through August 10, 2017, by dialing (844) 512-2921 for the U.S. or Canada or (412) 317-6671 for international callers, and entering passcode #7942677.

About Proofpoint, Inc.

Proofpoint Inc. (NASDAQ:PFPT) is a leading next-generation security and compliance company that provides cloud-based solutions to protect the way people work today. Proofpoint solutions enable organizations to protect their users from advanced attacks delivered via email, social media and mobile apps, protect the information their users create from advanced attacks and compliance risks, and respond quickly when incidents occur. More information is available at www.proofpoint.com.

Proofpoint is a trademark or registered trademark of Proofpoint, Inc. in the U.S. and other countries. All other trademarks contained herein are the property of their respective owners.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements regarding momentum in the company's business, market position, win rates and renewal rates, future growth, and future financial results. It is possible that future circumstances might differ from the assumptions on which such statements are based. Important factors that could cause results to differ materially from the statements herein include: failure to maintain or increase renewals and increased business from existing customers and failure to generate increased business through existing or new channel partner relationships; uncertainties related to continued success in sales growth and market share gains; failure to convert sales opportunities into definitive customer agreements; risks associated with successful implementation of multiple integrated software products and other product functionality; competition, particularly from larger companies with more resources than Proofpoint; risks related to new target markets, new product introductions and innovation and market acceptance thereof; the ability to attract and retain key personnel; potential changes in strategy; risks associated with management of growth; lengthy sales and implementation cycles, particularly in larger organizations; the time it takes new sales personnel to become fully productive; unforeseen delays in developing new technologies and the uncertain market acceptance of new products or features; technological changes that make Proofpoint's products and services less competitive; security breaches, which could affect our brand; the costs of litigation; the impact of changes in foreign currency exchange rates; the effect of general economic conditions, including as a result of specific economic risks in different geographies and among different industries; risks related to integrating the employees, customers and technologies of acquired businesses; assumption of unknown liabilities from acquisitions; ability to retain customers of acquired entities; and the other risk factors set forth from time to time in our filings with the SEC, including our Quarterly Report on Form 10-Q for the three months ended March 31, 2017, and the other reports we file with the SEC, copies of which are available free of charge at the SEC's website at www.sec.gov or upon request from our investor relations department.  All forward-looking statements herein reflect our opinions only as of the date of this release, and Proofpoint undertakes no obligation, and expressly disclaims any obligation, to update forward-looking statements herein in light of new information or future events.

Computational Guidance on Earnings Per Share Estimates

Accounting principles require that EPS be computed based on the weighted average shares outstanding ("basic"), and also assuming the issuance of potentially issuable shares (such as those subject to stock options, convertible notes, etc.) if those potentially issuable shares would reduce EPS ("diluted").

The number of shares related to options and similar instruments included in diluted EPS is based on the "Treasury Stock Method" prescribed in Financial Accounting Standards Board ("FASB") ASC Topic 260, Earnings Per Share ("FASB ASC Topic 260"). This method assumes a theoretical repurchase of shares using the proceeds of the respective stock option exercise at a price equal to the issuer's average stock price during the related earnings period. Accordingly, the number of shares includable in the calculation of diluted EPS in respect of stock options and similar instruments is dependent on this average stock price and will increase as the average stock price increases.

The number of shares includable in the calculation of diluted EPS in respect of convertible senior notes is based on the "If Converted" method prescribed in FASB ASC Topic 260. This method assumes the conversion or exchange of these securities for shares of common stock. In determining if convertible securities are dilutive, the interest savings (net of tax) subsequent to an assumed conversion are added back to net earnings. The shares related to a convertible security are included in diluted EPS only if EPS as otherwise calculated is greater than the interest savings, net of tax, divided by the shares issuable upon exercise or conversion of the instrument. Accordingly, the calculation of diluted EPS for these instruments is dependent on the level of net earnings. Each series of convertible securities is considered individually and in sequence, starting with the series having the lowest incremental earnings per share, to determine if its effect is dilutive or anti-dilutive.

Non-GAAP Financial Measures

We have provided in this release financial information that has not been prepared in accordance with GAAP. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We believe that 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 our financial results with other companies in our industry, many of which present similar non-GAAP financial measures to investors. 

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures below. As previously mentioned, a reconciliation of our non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.

Non-GAAP gross profit and gross margin. We define non-GAAP gross profit as GAAP gross profit, adjusted to exclude stock-based compensation expense and the amortization of intangibles associated with acquisitions. We define non-GAAP gross margin as non-GAAP gross profit divided by GAAP revenue. We consider these non-GAAP financial measures to be useful metrics for management and investors because they exclude the effect of non-cash charges that can fluctuate for Proofpoint, based on timing of equity award grants and the size, timing and purchase price allocation of acquisitions so that our management and investors can compare our recurring core business operating results over multiple periods. There are a number of limitations related to the use of non-GAAP gross profit and non-GAAP gross margin versus gross profit and gross margin, in each case, calculated in accordance with GAAP. For example, stock-based compensation has been and will continue to be for the foreseeable future a significant recurring expense in our business. Stock-based compensation is an important part of our employees' compensation and impacts their performance. In addition, the components of the costs that we exclude in our calculation of non-GAAP gross profit and non-GAAP gross margin may differ from the components that our peer companies exclude when they report their non-GAAP results.  Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP gross profit and non-GAAP gross margin and evaluating non-GAAP gross profit and non-GAAP gross margin together with gross profit and gross margin calculated in accordance with GAAP.

Non-GAAP operating loss. We define non-GAAP operating loss as operating loss, adjusted to exclude stock-based compensation expense and the amortization of intangibles and costs associated with acquisitions and litigation. Costs associated with acquisitions include legal, accounting, and other professional fees, as well as changes in the fair value of contingent consideration obligations. We consider this non-GAAP financial measure to be a useful metric for management and investors because they exclude the effect of stock-based compensation expense and the amortization of intangibles and costs associated with acquisitions and litigation so that our management and investors can compare our recurring core business operating results over multiple periods. There are a number of limitations related to the use of non-GAAP operating loss versus operating loss calculated in accordance with GAAP. For example, as noted above, non-GAAP operating loss excludes stock-based compensation expense. In addition, the components of the costs that we exclude in our calculation of non-GAAP operating loss may differ from the components that our peer companies exclude when they report their non-GAAP results of operations, and some of these items are cash-based. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP operating loss and evaluating non-GAAP operating loss together with operating loss calculated in accordance with GAAP.

Non-GAAP net loss. We define non-GAAP net loss as net loss, adjusted to exclude stock-based compensation expense, amortization of intangibles, costs associated with acquisitions and litigation, non-cash interest expense related to the convertible debt discount and issuance costs for the convertible debt offering, and tax effects associated with these items. We consider this non-GAAP financial measure to be a useful metric for management and investors for the same reasons that we use non-GAAP operating loss. However, in order to provide a complete picture of our recurring core business operating results, we also exclude from non-GAAP net loss the tax effects associated with stock-based compensation and the amortization of intangibles and costs associated with acquisitions and litigation, and non-cash interest expense related to the convertible debt discount and issuance costs for the convertible debt offering.

In order to provide a complete picture of our recurring core business operating results, we also compute the tax effect of the adjustments used in determining our non-GAAP results by calculating an adjusted tax provision which considers the current and deferred tax impact of the adjustments.  The adjusted tax provision reflects all of the relevant impacts of the adjustments, inclusive of those items that have an impact to the effective tax rate, current provision and deferred provision.  As a result of the varying impacts of each item, the effective tax rate for the adjusted tax provision will vary period over period as compared to the GAAP tax provision. The adjusted tax provision is then compared to the GAAP tax provision, and the difference is reflected as "income tax benefit (expense)" in the reconciliation between GAAP net loss/income and Non-GAAP net loss/income.

Billings. We define billings as revenue recognized plus the change in deferred revenue from the beginning to the end of the period, but excluding additions to deferred revenue from acquisitions. We consider billings to be a useful metric for management and investors because billings drive deferred revenue, which is an important indicator of the health and visibility of our business, and has historically represented a majority of the quarterly revenue that we recognize. There are a number of limitations related to the use of billings versus revenue calculated in accordance with GAAP. Billings include amounts that have not yet been recognized as revenue, but exclude additions to deferred revenue from acquisitions. We may also calculate billings in a manner that is different from other companies that report similar financial measures. Management compensates for these limitations by providing specific information regarding GAAP revenue and evaluating billings together with revenues calculated in accordance with GAAP.

Free cash flow. We define free cash flow as net cash provided by operating activities minus capital expenditures. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after the acquisition of property and equipment, can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening the balance sheet. Analysis of free cash flow facilitates management's comparisons of our operating results to competitors' operating results. A limitation of using free cash flow versus the GAAP measure of net cash provided by operating activities as a means for evaluating our company is that free cash flow does not represent the total increase or decrease in the cash balance from operations for the period because it excludes cash used for capital expenditures during the period. Management compensates for this limitation by providing information about our capital expenditures on the face of the cash flow statement and in the "Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources" section of our quarterly and annual reports filed with the SEC.

 
Proofpoint, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
           
           
  Three Months Ended
June 30,
 Six Months Ended
June 30,
  
   2017   2016   2017   2016   
Revenue:          
Subscription $118,928  $87,318  $229,853  $164,715   
Hardware and services  3,401   2,586    5,726   4,192   
Total revenue   122,329   89,904   235,579   168,907   
Cost of revenue:(1)(2)           
Subscription  30,363   23,198   58,684   44,880   
Hardware and services  4,130   3,460   8,185   6,602   
Total cost of revenue  34,493   26,658   66,869   51,482   
Gross profit  87,836   63,246   168,710   117,425   
Operating expense:(1)(2)          
Research and development  32,306   23,588   61,912   46,241   
Sales and marketing  62,454   48,664   121,186   95,187   
General and administrative  12,348   22,999   22,835   33,603   
Total operating expense  107,108   95,251   205,933   175,031   
Operating loss  (19,272)  (32,005)  (37,223)   (57,606)  
Interest expense  (5,848)  (5,809)  (11,814)  (11,609)  
Other income (expense), net  184   (302)  55   (300)  
Loss before provision for income taxes  (24,936)  (38,116)  (48,982)  (69,515)  
Provision for income taxes  (999)  (185)  (2,433)  (442)  
Net loss $(25,935) $(38,301) $(51,415) $(69,957)  
Net loss per share, basic and diluted $(0.59) $(0.92) $(1.18) $(1.69)  
Weighted average shares outstanding, basic and diluted  43,890   41,605   43,562   41,349   
            
(1)  Includes stock‑based compensation expense as follows:          
Cost of subscription revenue $2,863  $1,721  $5,239  $3,359    
Cost of hardware and services revenue  469   392   908   745   
Research and development  7,744   5,877   14,794   11,479   
Sales and marketing  8,230   6,718   16,127    13,536   
General and administrative  5,198   4,000   9,810   8,072   
Total stock-based compensation expense $24,504  $18,708  $46,878  $37,191   
(2)  Includes intangible amortization expense as follows:           
Cost of subscription revenue $3,189  $2,118  $6,377  $4,235   
Research and development  15   15   30   30   
Sales and marketing  949   1,236   1,916   2,509   
Total intangible amortization expense $4,153  $3,369  $8,323  $6,774   
           

 

Proofpoint, Inc.
Consolidated Balance Sheets
(In thousands, except per share amounts)
(Unaudited)
       
  June 30, December 31,  
   2017   2016   
Assets      
Current assets:      
Cash and cash equivalents $392,886  $345,426   
Short-term investments  36,599   51,325   
Accounts receivable, net  75,568   72,951   
Inventory   497   598   
Deferred product costs  1,488   1,829   
Deferred commissions  20,516   21,168   
Prepaid expenses and other current assets  12,411   17,498   
Total current assets  539,965   510,795   
Property and equipment, net  64,712   52,523   
Deferred product costs  292   310   
Goodwill  167,270   167,270   
Intangible assets, net  53,386   61,708   
Long-term deferred commissions  4,356   4,496   
Other assets  10,725   4,558   
Total assets $840,706  $801,660   
Liabilities and Stockholders' Equity      
Current liabilities:      
Accounts payable $14,273  $15,297   
Accrued liabilities  40,267   50,765   
Capital lease obligations  31   32   
Deferred rent   460   409   
Deferred revenue  297,446   259,109   
Total current liabilities  352,477   325,612   
Convertible senior notes  377,422   366,541   
Long-term capital lease obligations  75   91   
Long-term deferred rent  3,186   2,413   
Other long-term liabilities  10,877   9,008   
Long-term deferred revenue  62,903   53,072   
Total liabilities  806,940   756,737   
Stockholders' equity      
Common stock, $0.0001 par value; 200,000 shares authorized; 44,337 and 43,015 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively  4   4   
Additional paid-in capital  555,287   514,034   
Accumulated other comprehensive loss  (3)  (7)  
Accumulated deficit  (521,522)  (469,108)  
Total stockholders' equity  33,766   44,923   
Total liabilities and stockholders' equity $840,706  $801,660   
       

 

Proofpoint, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
           
  Three Months Ended
June 30,
 Six Months Ended
June 30,
  
   2017   2016   2017   2016   
Cash flows from operating activities           
Net loss $(25,935) $(38,301) $(51,415) $(69,957)  
Adjustments to reconcile net loss to net cash provided by operating activities:          
Depreciation and amortization  9,848    7,385   19,147   14,621   
Loss on disposal of property and equipment  346   99   357   288    
Amortization of investment premiums, net of accretion of purchase discounts  (38)  (15)  10   35   
Stock‑based compensation  24,504   18,708   46,878   37,191   
Change in fair value of contingent consideration  (284 )  -   (1,730)   -   
Amortization of debt issuance costs and accretion of debt discount  5,484   5,172   10,888   10,268   
Foreign currency transaction (gain) loss  (228)  259   (86)  35   
Changes in assets and liabilities:          
Accounts receivable  (13,166)  (2,403)  (2,725)  (3,299)  
Inventory  (25)   279   101   183   
Deferred products costs  268   271   359   435   
Deferred commissions  (1,880)  (860)  791   621   
Prepaid expenses   (838)  (276)  (1,686)  (533)  
Other current assets  (84)  48   260   104   
Deferred income taxes  239   (41)  (2,116)  (167)  
Long-term assets  190   48   (3,710)  51   
Accounts payable   211   4,487   (1,374)  5,959   
Accrued liabilities  3,363   2,113   4,014   (755)  
Deferred rent  532   (21)  824   (12)  
Deferred revenue  23,979   11,341   48,168   30,643   
Net cash provided by operating activities  26,486   8,293   66,955   25,711   
Cash flows from investing activities          
Proceeds from sales and maturities of short-term investments  23,159   14,261   56,081   68,900   
Purchase of short-term investments  (28,705)  (26,762)  (41,360)  (53,742)  
Purchase of property and equipment  (10,616)  (8,356)  (22,867)  (16,194)  
Receipts from escrow account  2,054   -   4,620   -   
Net cash used in investing activities  (14,108)  (20,857)  (3,526)  (1,036)  
Cash flows from financing activities          
Proceeds from issuance of common stock  10,893   8,463   13,218   10,335    
Withholding taxes related to restricted stock net share settlement  (10,612)  (5,874)  (25,122)  (12,572)  
Repayments of equipment loans and capital lease obligations  (8)  (8)  (16)  (16)  
Holdback payments for prior acquisitions  -   -   -   (1,397)  
Contingent consideration payment  (2,054)  -   (4,620)  -   
Net cash (used in) provided by financing activities  (1,781)  2,581   (16,540)  (3,650)  
Effect of exchange rate changes on cash and cash equivalents  427   (198)  571   30    
Net increase (decrease) in cash and cash equivalents  11,024   (10,181)  47,460   21,055   
Cash and cash equivalents          
Beginning of period  381,862   377,441   345,426   346,205   
End of period $392,886  $367,260  $392,886  $367,260   
           

 

Reconciliation of Non-GAAP Measures 
(In thousands, except per share amounts) 
(Unaudited) 
            
   Three Months Ended    Six Months Ended    
   June 30,   June 30,    
   2017   2016   2017   2016    
             
GAAP gross profit $87,836  $63,246  $168,710  $117,425    
GAAP gross margin  72%   70%   72%   70%    
Plus:           
Stock-based compensation expense  3,332   2,113   6,147   4,104    
Intangible amortization expense  3,189   2,118   6,377   4,235     
Non-GAAP gross profit  94,357   67,477   181,234    125,764    
Non-GAAP gross margin  77%   75%   77%   74%    
            
GAAP operating loss  (19,272)  (32,005)  (37,223)  (57,606)   
Plus:           
Stock-based compensation expense   24,504   18,708   46,878   37,191    
Intangible amortization expense  4,153   3,369   8,323   6,774    
Acquisition-related expenses  (284)  118   (1,754)  122    
Litigation-related expenses  -   13,462   -   14,657    
Non-GAAP operating income  9,101   3,652    16,224   1,138    
            
GAAP net loss  (25,935)  (38,301)  (51,415)  (69,957)   
Plus:           
Stock-based compensation expense  24,504   18,708   46,878   37,191    
Intangible amortization expense  4,153   3,369   8,323   6,774     
Acquisition-related expenses  (284)  118   (1,754)  122    
Litigation-related expenses  -   13,462   -   14,657    
Interest expense - debt discount and issuance costs  5,484   5,172   10,888   10,268    
Income tax benefit (expense)  120   (23)  628   (45)   
Non-GAAP net income (loss) (1) $8,042  $2,505  $13,548  $(990)   
Add interest expense of convertible senior notes, net of tax (1)  1,060   -   1,258   -    
Numerator for non-GAAP EPS calculation $ 9,102  $2,505  $14,806  $(990)   
Non-GAAP net income (loss) per share - diluted $0.17  $0.06  $0.28  $(0.02)    
            
GAAP weighted-average shares used to compute net loss per share, diluted  43,890   41,605   43,562   41,349    
Dilutive effect of convertible senior notes (2)  7,989   -   5,157   -    
Dilutive effect of employee equity incentive plan awards (3)  3,130   3,528   3,363   -    
Non-GAAP weighted-average shares used to compute net income (loss) per share, diluted  55,009    45,133   52,082   41,349    
            
(1) Due to the full valuation allowance on the Company's deferred tax assets, there were no tax effects associated with the non-GAAP adjustments for stock-based compensation, costs associated with acquisitions and litigations, and non-cash interest expense related to the debt discount and issuance costs for the convertible debt offering. Only GAAP deferred tax expenses or benefits related to the amortization of intangibles were excluded from the non-GAAP income tax expense. 
(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) 
            
   Three Months Ended   Six Months Ended    
   June 30,   June 30,    
   2017   2016    2017   2016     
            
Total revenue $122,329  $89,904  $235,579  $168,907    
            
Deferred revenue           
Ending  360,349   254,370   360,349   254,370    
Beginning  336,369   243,028   312,181   223,726    
Net Change  23,980   11,342   48,168   30,644     
Less:           
Deferred revenue contributed by acquisitions  -   -   -   -    
Billings $146,309  $101,246  $283,747  $199,551     
            

 

Reconciliation of GAAP Cash Flows from Operations to Free Cash Flows
(In thousands)
(Unaudited)
           
   Three Months Ended    Six Months Ended   
   June 30,   June 30,   
   2017    2016   2017    2016   
           
GAAP cash flows provided by operating activities $26,486  $8,293  $66,955  $25,711   
Less:          
Purchases of property and equipment  (10,616)  (8,356)  (22,867)  (16,194)  
Non-GAAP free cash flows $15,870  $(63) $44,088  $9,517   
           

 

Revenue by Solution 
(In thousands) 
(Unaudited) 
             
  Three Months Ended  
  June 30, 2017 March 31, 2017 December 31,
2016
 September 30,
2016
 June 30, 2016  March 31, 2016 
             
Protection and Advanced Threat$90,376 $84,480 $78,698 $72,664 $64,797 $56,462 
Archiving, Privacy and Governance 31,953  28,770  28,107  27,120  25,107  22,541 
Total revenue$122,329 $113,250 $106,805 $99,784 $89,904 $79,003 
             

 

Reconciliation of Non-GAAP Measures to Guidance 
(In millions, except per share amount) 
(Unaudited) 
      
   Three Months Ending   Year Ending  
    September 30,   December 31,  
  2017  2017  
      
Total revenue $130 - $132 $503 - $506 
      
GAAP gross profit 93.0 - 94.9 359.7 - 362.9 
GAAP gross margin 72% 72% 
Plus:     
Stock-based compensation expense 3.9 - 3.6 14.8 - 14.0 
Intangible amortization expense 3.2 - 3.1 12.8 - 12.7 
Non-GAAP gross profit 100.1 - 101.6 387.3 - 389.6 
Non-GAAP gross margin 77% 77% 
      
GAAP net loss $(28.2) - $(24.8) $(112.4) - $(104.1) 
Plus:     
Stock-based compensation expense 27.5 - 25.5 106.0 - 100.0 
Intangible amortization expense 3.1 - 2.9 16.5 - 16.0 
Acquisition-related expenses  (1.7) - (1.8) 
Interest expense - debt discount and issuance costs 5.6 - 5.5 22.2 - 22.1 
Income tax expense (0.0) - (0.1) (0.6) - (0.7) 
Non-GAAP net income $8.0 - $9.0 $30.0 - $31.5 
Add interest expense of convertible senior notes, net of tax (if dilutive) 1.1
 4.2
 
Numerator for non-GAAP EPS calculation $9.1 - $10.1 $34.2 - $35.7 
Non-GAAP net income per share - diluted $0.16 - $0.18 $0.62 - $0.64 
Non-GAAP weighted-average shares used to compute net income per share, diluted 55.4
 55.4
 
      
   Three Months Ending   Year Ending  
   September 30,    December 31,  
  2017  2017  
      
GAAP cash flows provided by operating activities $38.0 - $40.0  $144.0 - $153.0 
Less:     
Purchases of property and equipment (12.0) (44.0 - 46.0) 
Non-GAAP free cash flows $26.0 - $28.0 $100.0 - $107.0 
       


Media Contact

Kristy Campbell

Proofpoint, Inc.

408-517-4710

kcampbell@proofpoint.com



Investor Contacts

Jason Starr

Proofpoint, Inc.

408-585-4351

jstarr@proofpoint.com



Seth Potter

ICR for Proofpoint, Inc.

646-277-1230 

seth.potter@icrinc.com

Primary Logo

Source: Proofpoint, Inc.

News Provided by Acquire Media