Radware® (NASDAQ: RDWR), a leading provider of cyber security and application delivery solutions, today announced its consolidated financial results for the quarter ended September 30, 2020.
Third Quarter 2020 Results and Financial Highlights
- Revenues of $62.5 million
- Non-GAAP EPS of $0.18; GAAP EPS of $0.08
- Net cash provided by operating activities of $50 million for the last twelve months
“We are pleased with the results for the third quarter, during which we enjoyed a very strong and broad-based bookings growth, spanning across all our geographic regions and product lines.” said Roy Zisapel, Radware’s President & CEO. “Our strategic OEM relationships delivered record booking in the quarter, further enhancing our strong position within the large enterprise segment, and contributing positively to the growth in our recurring revenues”.
Financial Highlights for the Third Quarter of 2020
Revenues for the third quarter of 2020 totaled $62.5 million, down 1% from revenues of $62.9 million for the third quarter of 2019. Revenues for the first nine months of 2020 totaled $181.0 million, down 2% from revenues of $184.7 million for the first nine months of 2019:
- Revenues in the Americas region were $30.2 million for the third quarter of 2020, up 24% from revenues of $24.5 million in the third quarter of 2019. For the first nine months of 2020, revenues in the Americas region increased 13% over the same period in 2019.
- Revenues in the Europe, Middle East and Africa (“EMEA”) region were $18.3 million for the third quarter of 2020, down 5% from revenues of $19.4 million in the third quarter of 2019. For the first nine months of 2020, revenues in the EMEA region decreased 1% over the same period in 2019.
- Revenues in the Asia-Pacific (“APAC”) region were $14.0 million for the third quarter of 2020, down 27% from revenues of $19.0 million in the third quarter of 2019. For the first nine months of 2020, revenues in the APAC region decreased 25% over the same period in 2019.
Net income on a GAAP basis for the third quarter of 2020 was $3.6 million, or $0.08 per diluted share, compared with net income of $7.1 million, or $0.15 per diluted share, for the third quarter of 2019.
Non-GAAP net income for the third quarter of 2020 was $8.4 million, or $0.18 per diluted share, compared with non- GAAP net income of $11.9 million, or $0.25 per diluted share, for the third quarter of 2019.
Non-GAAP results are calculated excluding, as applicable, the impact of stock-based compensation expenses, amortization of intangible assets, acquisition costs, litigation costs, exchange rate differences, net on balance sheet items included in finance income, other loss (gain) adjustment and tax related adjustments. A reconciliation of each of the Company’s non-GAAP measures to the comparable GAAP measure is included at the end of this press release.
As of September 30, 2020, the Company had cash, cash equivalents, short-term and long-term bank deposits and marketable securities of $437.4 million. Net cash provided by operating activities in the third quarter of 2020 totaled $6.8 million. Net cash spent on share repurchases in the third quarter of 2020 totaled $15.9 million.
Radware management will host a call on Wednesday, November 4, 2020 at 8:30 a.m. ET to discuss its third quarter 2020 results and the Company’s outlook for the fourth quarter of 2020.
- Participants in the US call: Toll Free 833-241-4257
- Participants Internationally call: +1-647-689-4208
- Conference ID: 8719353
A replay will be available for 2 days, starting 2 hours after the end of the call, on telephone number +1-416-621-4642 or (US toll-free) 800-585-8367.
A live webcast of the conference call can also be heard by accessing the Company's website at: https://www.radware.com/IR/. The webcast will remain available for replay during the next 12 months.
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), Radware uses non-GAAP measures of gross profit, research and development expense, selling and marketing expense, general and administrative expense, total operating expenses, operating income, financial income, income before taxes on income, taxes on income, net income and earnings per share, which are adjustments from results based on GAAP to exclude stock-based compensation expenses, amortization of intangible assets, acquisition costs, litigation costs, exchange rate differences, net on balance sheet items included in finance income, other loss (gain) adjustment and tax related adjustments. Management believes that exclusion of these charges allows for meaningful comparisons of operating results across past, present and future periods. Radware’s management believes the non-GAAP financial measures provided in this release are useful to investors for the purpose of understanding and assessing Radware’s ongoing operations. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measures is included with the financial information contained in this press release. Management uses both GAAP and non-GAAP financial measures in evaluating and operating the business and, as such, has determined that it is important to provide this information to investors.
Safe Harbor Statement
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements made herein that are not statements of historical fact, including statements about Radware’s plans, outlook, beliefs or opinions, are forward-looking statements. Generally, forward-looking statements may be identified by words such as “believes,” “expects,” “anticipates,” “intends,” “estimates,” “plans,” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could.” Because such statements deal with future events, they are subject to various risks and uncertainties, and actual results, expressed or implied by such forward-looking statements, could differ materially from Radware’s current forecasts and estimates. Factors that could cause or contribute to such differences include, but are not limited to: the impact of global economic conditions and volatility of the market for our products; natural disasters and public health crises, such as the coronavirus disease 2019 (COVID-19) pandemic; our ability to expand our operations effectively; timely availability and customer acceptance of our new and existing solutions; risks and uncertainties relating to acquisitions or other investments; the impact of economic and political uncertainties and weaknesses in various regions of the world, including the commencement or escalation of hostilities or acts of terrorism; intense competition in the market for cyber security and application delivery solutions and in our industry in general and changes in the competitive landscape; changes in government regulation; outages, interruptions or delays in hosting services or our internal network system; compliance with open source and third-party licenses; the risk that our intangible assets or goodwill may become impaired; our dependence on independent distributors to sell our products; long sales cycles for our solutions; changes in foreign currency exchange rates; undetected defects or errors in our products or a failure of our products to protect against malicious attacks; the availability of components and manufacturing capacity; the ability of vendors to provide our hardware platforms and components for our main accessories; our ability to protect our proprietary technology; intellectual property infringement claims made by third parties; changes in tax laws; our ability to realize our investment objectives for our cash and liquid investments; our ability to attract, train and retain highly qualified personnel; and other factors and risks over which we may have little or no control. This list is intended to identify only certain of the principal factors that could cause actual results to differ. For a more detailed description of the risks and uncertainties affecting Radware, refer to Radware’s Annual Report on Form 20-F, filed with the Securities and Exchange Commission (SEC) and the other risk factors discussed from time to time by Radware in reports filed with, or furnished to, the SEC. Forward-looking statements speak only as of the date on which they are made and, except as required by applicable law, Radware undertakes no commitment to revise or update any forward-looking statement in order to reflect events or circumstances after the date any such statement is made. Radware’s public filings are available from the SEC’s website at www.sec.gov or may be obtained on Radware’s website at www.radware.com.
Radware® (NASDAQ: RDWR), is a global leader of cyber security and application delivery solutions for physical, cloud, and software defined data centers. Its award-winning solutions portfolio secures the digital experience by providing infrastructure, application, and corporate IT protection and availability services to enterprises globally. Radware’s solutions empower more than 12,500 enterprise and carrier customers worldwide to adapt to market challenges quickly, maintain business continuity and achieve maximum productivity while keeping costs down. For more information, please visit www.radware.com.
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