Third quarter 2008 revenues were
Operating expenses for the third quarter of 2008 were
For the third quarter of 2008, MicroStrategy's effective tax rate on income from continuing operations was 40.7%, compared to 32.7% in the third quarter of 2007. The increase in the effective tax rate was primarily attributable to an increase in cross border withholding taxes and, to a lesser extent, net losses in certain foreign subsidiaries for which the Company is not currently able to recognize a tax benefit from those losses for financial reporting purposes.
As of
New Customers and New Deals with Existing Customers in Q3 2008 Included:
24 Hour Fitness; Air National Guard; AmerisourceBergen Services
Corporation; Avon Products, Inc.; Booz, Allen & Hamilton Inc.; Cabela's
Incorporated; Cancer Care Ontario; Capital Group Companies; Catalina Marketing
Corporation; Dana-Farber Cancer Institute; GE Healthcare; Honeywell Federal
Manufacturing & Technologies, LLC; Meijer Great Lakes Limited Partnership;
Memorial Sloan Kettering Cancer Center; Meredith Corporation; National
Aeronautics and Space Administration; Nordstrom, Inc.; NTT America, Inc.;
Pacific Sunwear; PMSI, Inc.; PPL Services Corporation;
Examples of Customer Deals from Q3 2008:
24 Hour Fitness
24 Hour Fitness, the largest fitness club chain in the U.S., has selected MicroStrategy to support its enterprise business intelligence applications. A new MicroStrategy customer, 24 Hour Fitness plans to use the MicroStrategy Business Intelligence Platform(TM) for reporting on and analyzing a wide range of key performance indicators for its 425 clubs. Club managers, field management, and corporate management will use MicroStrategy to gain greater insights into club traffic, member preferences, and sales and financial data to help them make more informed decisions. MicroStrategy was selected for its data and user scalability, broad range of reporting features and functionality, and excellent query performance.
Cabela's Incorporated
Cabela's, a leading specialty retailer of hunting, fishing, and outdoor gear, has chosen MicroStrategy as its enterprise reporting standard. MicroStrategy will be used across the organization for enhanced insights into key business areas, including inventory planning, customer service, sales administration, forecast analysis, and category management. In addition, MicroStrategy will be used to help Cabela's improve its online business by enabling Cabela's employees to review every item purchased online and better understand the items that customers typically purchase together.
Meredith Corporation
Meredith Corporation, headquartered in
NTT America, Inc.
NTT America, Inc., a wholly owned U.S. subsidiary of NTT Communications Corporation, selected MicroStrategy to analyze and monitor key customer service performance metrics. NTT America chose MicroStrategy's Dynamic Enterprise Dashboards(TM) to monitor customer service data, including response times to trouble tickets. NTT America executives and managers will use the MicroStrategy information dashboards for at-a-glance insights into customer service performance to help them make data-driven decisions. With MicroStrategy, NTT America expects to be able to improve its service response times, allocate resources more efficiently, and address other critical service areas to improve customer satisfaction and retention.
Latest Release of MicroStrategy Advanced Visualizations
In the third quarter of 2008, MicroStrategy announced the latest release of advanced visualization widgets for its Dynamic Enterprise Dashboards. MicroStrategy's library of advanced visualization widgets enables users to view data in a highly visual and interactive manner to augment data comprehension and enhance decision making. MicroStrategy leverages Adobe(R) Flash(R) to incorporate visualization, interactivity, and animation into its widgets.
MicroStrategy customers can use Adobe(R) Flex(TM) 2 and Flex 3 to create their own MicroStrategy-compatible visualization widgets to include in dashboards and reports. Some of the newest widgets include:
-- The Bubble Grid widget, which enables users to plot metric values as bubbles of different colors and sizes within a grid
-- The Funnel widget, a variation of a stacked percent bar chart in a funnel shape, which is well-suited for a variety of business purposes, including pipeline analyses for sales forecasts and sales process analysis
-- The Waterfall widget, which displays a series of increments and decrements that users can modify to perform a scenario analysis on the data and help identify causes for fluctuations in the business
MicroStrategy Recognized by Forbes
For the second consecutive year, MicroStrategy was named to the Forbes 200
Best Small Companies in America list. To qualify, companies must have sales
between
Enhanced Curriculum for MicroStrategy's Introduction to Enterprise BI Class
MicroStrategy recently updated the curriculum for its Introduction to Enterprise Business Intelligence class to address the changing BI needs of organizations and provide insights into MicroStrategy's latest product enhancements. The one-day class is offered at no charge to companies interested in learning about enterprise BI and the MicroStrategy Business Intelligence Platform(TM). MicroStrategy has offered the class since 2006, with thousands of participants attending classes held in cities around the world. Each quarter, MicroStrategy offers approximately 100 classes.
MicroStrategy Events
MicroStrategy held numerous Business Intelligence Symposia during the
third quarter, and has several more planned in the fourth quarter of 2008,
including in
About MicroStrategy Incorporated
Founded in 1989, MicroStrategy is a global leader in business intelligence (BI) technology. MicroStrategy provides integrated reporting, analysis, and monitoring software that helps leading organizations worldwide make better business decisions every day. Companies choose MicroStrategy for its advanced technical capabilities, sophisticated analytics, and superior data and user scalability. More information about MicroStrategy (Nasdaq: MSTR) is available at www.microstrategy.com.
MicroStrategy, MicroStrategy 8, MicroStrategy Business Intelligence
Platform, MicroStrategy Dynamic Enterprise Dashboards, MicroStrategy Mobile,
and MicroStrategy Integrity Manager are either trademarks or registered
trademarks of MicroStrategy Incorporated in
This press release may include statements that may constitute "forward- looking statements," including estimates of future business prospects or financial results and statements containing the words "believe," "estimate," "project," "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the "Company") to differ materially from the forward-looking statements. Factors that could contribute to such differences include: the ability of the Company to implement and achieve widespread customer acceptance of its MicroStrategy 8 software on a timely basis; the Company's ability to recognize deferred revenue through delivery of products or satisfactory performance of services; continued acceptance of the Company's products in the marketplace; the timing of significant orders; delays in the Company's ability to develop or ship new products; market acceptance of new products; the Company's ability to effect the sale of its Alarm.com business on acceptable terms, or at all; competitive factors; general economic conditions, including significant downturns in industries, including the financial services and retail industries, in which we have a significant number of customers; currency fluctuations; and other risks detailed in the Company's registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward- looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
Contact: MicroStrategy Incorporated Investor Relations ir@microstrategy.com (703) 848-8600 MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 2008 2007 2008 2007 (unaudited) (unaudited) (unaudited) (unaudited) Revenues Product licenses $24,787 $30,210 $67,966 $68,608 Product support and other services 65,841 61,022 197,422 171,539 Total revenues 90,628 91,232 265,388 240,147 Cost of Revenues Product licenses 422 713 1,442 2,156 Product support and other services 16,304 11,784 45,898 34,925 Total cost of revenues 16,726 12,497 47,340 37,081 Gross profit 73,902 78,735 218,048 203,066 Operating Expenses Sales and marketing 35,888 28,544 100,060 79,223 Research and development 5,922 9,279 24,449 25,126 General and administrative 14,744 12,170 47,055 37,176 Total operating expenses 56,554 49,993 171,564 141,525 Income from continuing operations before financing and other income and income taxes 17,348 28,742 46,484 61,541 Financing and Other Income Interest income, net 623 927 2,081 2,782 Other income (expense), net 694 (828) (269) (791) Total financing and other income 1,317 99 1,812 1,991 Income from continuing operations before income taxes 18,665 28,841 48,296 63,532 Provision for income taxes 7,593 9,439 20,365 22,797 Income from continuing operations 11,072 19,402 27,931 40,735 Income (loss) from discontinued operations, net of tax provision (benefit) ($53 and ($54) for the three months ended, respectively, and $176 and $46 for the nine months ended, respectively) 52 (67) (383) 58 Net Income $11,124 $19,335 $27,548 $40,793 Basic earnings (loss) per share (1): From continuing operations $0.93 $1.58 $2.35 $3.28 From discontinued operations $0.01 $(0.01) $(0.03) $0.01 Basic earnings per share $0.94 $1.57 $2.32 $3.29 Weighted average shares outstanding used in computing basic earnings per share 11,887 12,286 11,890 12,416 Diluted earnings (loss) per share (1): From continuing operations $0.90 $1.52 $2.26 $3.14 From discontinued operations $0.00 $(0.01) $(0.03) $0.01 Diluted earnings per share $0.90 $1.51 $2.23 $3.15 Weighted average shares outstanding used in computing diluted earnings per share 12,306 12,771 12,332 12,953 (1) Basic and fully diluted earnings per share for class A and class B common stock are the same MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Core BI Business Angel.com Consolidated Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Revenues Product licenses $24,787 $30,210 $- $- $24,787 $30,210 Product support and other services 63,153 59,197 - - 63,153 59,197 Angel.com telephony services - - 2,688 1,825 2,688 1,825 Total revenues 87,940 89,407 2,688 1,825 90,628 91,232 Cost of Revenues Product licenses 422 713 - - 422 713 Product support and services revenues 15,908 11,277 - - 15,908 11,277 Angel.com telephony services - - 396 507 396 507 Total cost of revenues 16,330 11,990 396 507 16,726 12,497 Gross profit 71,610 77,417 2,292 1,318 73,902 78,735 Operating Expenses Sales and marketing 33,767 26,932 2,121 1,612 35,888 28,544 Research and development 5,234 8,615 688 664 5,922 9,279 General and administrative 14,679 12,163 65(a) 7(a) 14,744 12,170 Total operating expenses 53,680 47,710 2,874 2,283 56,554 49,993 Income (loss) from continuing operations 17,930 29,707 (582) (965) 17,348 28,742 Financing and Other Income Interest income, net 623 927 - - 623 927 Other income (expense), net 694 (828) - - 694 (828) Total financing and other income 1,317 99 - - 1,317 99 Income (loss) from continuing operations before income taxes $19,247 $29,806 $(582) $(965) $18,665 $28,841 Provision for income taxes 7,593 9,439 Income from continuing operations 11,072 19,402 Income (loss) from discontinued operations, net of tax 52 (67) Net income $11,124 $19,335 Basic earnings (loss) per share: From continuing operations $0.93 $1.58 From discontinued operations $0.01 $(0.01) Basic earnings per share $0.94 $1.57 Diluted earnings (loss) per share: From continuing operations $0.90 $1.52 From discontinued operations $0.00 $(0.01) Diluted earnings per share $0.90 $1.51 Basic weighted average shares outstanding 11,887 12,286 Diluted weighted average shares outstanding 12,306 12,771 (a) An insignificant amount of general and administrative services is provided to the Angel.com business unit by MicroStrategy's core business operations. MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Core BI Business Angel.com Consolidated Nine Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2008 2007 2008 2007 2008 2007 Revenues Product licenses $67,966 $68,608 $- $- $67,966 $68,608 Product support and other services 189,629 166,622 - - 189,629 166,622 Angel.com telephony services - - 7,793 4,917 7,793 4,917 Total revenues 257,595 235,230 7,793 4,917 265,388 240,147 Cost of Revenues Product licenses 1,442 2,156 - - 1,442 2,156 Product support and services revenues 44,602 33,482 - - 44,602 33,482 Angel.com telephony services - - 1,296 1,443 1,296 1,443 Total cost of revenues 46,044 35,638 1,296 1,443 47,340 37,081 Gross profit 211,551 199,592 6,497 3,474 218,048 203,066 Operating Expenses Sales and marketing 93,962 74,684 6,098 4,539 100,060 79,223 Research and development 22,229 23,048 2,220 2,078 24,449 25,126 General and administrative 46,840 37,169 215(a) 7(a) 47,055 37,176 Total operating expenses 163,031 134,901 8,533 6,624 171,564 141,525 Income (loss) from continuing operations 48,520 64,691 (2,036) (3,150) 46,484 61,541 Financing and Other Income Interest income, net 2,081 2,782 - - 2,081 2,782 Other expense, net (269) (791) - - (269) (791) Total financing and other income 1,812 1,991 - - 1,812 1,991 Income (loss) from continuing operations before income taxes $50,332 $66,682 $(2,036) $(3,150) $48,296 $63,532 Provision for income taxes 20,365 22,797 Income from continuing operations 27,931 40,735 Income (loss) from discontinued operations, net of tax (383) 58 Net income $27,548 $40,793 Basic earnings (loss) per share: From continuing operations $2.35 $3.28 From discontinued operations $(0.03) $0.01 Basic earnings per share $2.32 $3.29 Diluted earnings (loss) per share: From continuing operations $2.26 $3.14 From discontinued operations $(0.03) $0.01 Diluted earnings per share $2.23 $3.15 Basic weighted average shares outstanding 11,890 12,416 Diluted weighted average shares outstanding 12,332 12,953 (a) An insignificant amount of general and administrative services is provided to the Angel.com business unit by MicroStrategy's core business operations. MICROSTRATEGY INCORPORATED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) September 30, December 31, 2008 2007 Assets (unaudited) (audited) Current assets Cash and cash equivalents $127,287 $85,194 Restricted cash and investments 514 2,982 Accounts receivable, net 45,196 49,392 Prepaid expenses and other current assets 11,553 12,106 Deferred tax assets, net 24,535 29,652 Assets held-for-sale 7,663 4,272 Total current assets 216,748 183,598 Property and equipment, net 8,543 9,473 Capitalized software development cost, net 9,573 2,340 Deposits and other assets 37,313 11,433 Deferred tax assets, net 26,710 35,347 Total Assets $298,887 $242,191 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued expenses $50,130 $22,083 Accrued compensation and employee benefits 35,969 38,604 Deferred revenue and advance payments 69,757 64,234 Liabilities held-for-sale 7,338 3,436 Total current liabilities 163,194 128,357 Deferred revenue and advance payments 1,569 1,368 Other long-term liabilities 9,647 9,137 Total Liabilities 174,410 138,862 Stockholders' Equity Preferred stock undesignated, $0.001 par value; 5,000 shares authorized; no shares issued or outstanding - - Class A common stock, $0.001 par value; 330,000 shares authorized; 14,165 shares issued and 9,118 shares outstanding, and 14,113 shares issued and 9,184 shares outstanding, respectively 14 14 Class B common stock, $0.001 par value; 165,000 shares authorized; 2,770 issued and outstanding, respectively 3 3 Additional paid-in capital 450,622 448,229 Treasury stock, at cost; 5,047 and 4,929 shares, respectively (366,191) (357,804) Accumulated other comprehensive income 2,523 2,929 Retained earnings 37,506 9,958 Total Stockholders' Equity 124,477 103,329 Total Liabilities and Stockholders' Equity $298,887 $242,191 MICROSTRATEGY INCORPORATED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Nine Months Ended September 30, 2008 2007 Operating activities: Net income $27,548 $40,793 Plus: Loss (income) from discontinued operations, net 383 (58) Income from continuing operations 27,931 40,735 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 4,825 5,710 Bad debt expense 1,074 1,447 Deferred taxes 13,655 18,559 Stock-based compensation 45 413 Excess tax benefits from stock-based payment arrangements (241) (2,269) Other, net 49 116 Changes in operating assets and liabilities: Accounts receivable 3,617 5,710 Prepaid expenses and other current assets 176 (258) Deposits and other assets (218) (1,414) Accounts payable and accrued expenses, compensation and employee benefits, accrued interest 294 (8,447) Deferred revenue and advance payments 6,071 6,579 Other long-term liabilities 568 37 Net cash provided by operating activities from continuing operations 57,846 66,918 Net cash provided by (used in) operating activities from discontinued operations 1,399 (2,184) Net cash provided by operating activities 59,245 64,734 Investing activities: Advance deposits on purchases of property and equipment - (7,500) Purchases of property and equipment (2,972) (2,819) Capitalized software development costs (8,078) (2,650) Decrease in restricted cash and investments 1,062 997 Net cash used in investing activities from continuing operations (9,988) (11,972) Net cash used in investing activities from discontinued operations (158) (49) Net cash used in investing activities (10,146) (12,021) Financing activities: Proceeds from sale of class A common stock under exercise of employee stock options and employee stock purchase plan 2,073 2,013 Excess tax benefits from stock-based payment arrangements 241 2,269 Purchases of treasury stock (8,387) (62,634) Net cash used in financing activities from continuing operations (6,073) (58,352) Net cash used in financing activities from discontinued operations - - Net cash used in financing activities (6,073) (58,352) Effect of foreign exchange rate changes on cash and cash equivalents (933) 2,384 Net increase (decrease) in cash and cash equivalents from continuing operations 42,093 (3,255) Cash and cash equivalents, beginning of period 85,194 78,980 Cash and cash equivalents, end of period $127,287 $75,725
SOURCE MicroStrategy Incorporated