BroadSoft, Inc. (NASDAQ:BSFT), a leading global provider of hosted cloud-based enterprise communications software and services to the telecommunications industry, today announced financial results for the quarter ended September 30, 2016.
Financial Highlights for the Third Quarter of 2016
- Total revenue increased 22% year-over-year to $84.1 million
- GAAP gross profit equaled 72% of total revenue; non-GAAP gross profit equaled 76% of total revenue
- GAAP income from operations totaled $1.6 million; non-GAAP income from operations totaled $17.3 million or 21% of revenue
- GAAP basic and diluted net loss per share equaled $(0.02) per common share; non-GAAP diluted earnings per share equaled $0.52 per common share
Results for the three months ended September 30, 2016
Total revenue rose to $84.1 million in the third quarter of 2016, an increase of 22% compared to $69.1 million in the third quarter of 2015.
Net loss for the third quarter of 2016 was $(0.6) million, or $(0.02) per basic and diluted common share, compared to net loss of $(3.3) million, or $(0.11) per basic and diluted common share in the third quarter of 2015.
On a non-GAAP basis, net income in the third quarter of 2016 was $16.4 million, or $0.52 per diluted common share, compared to non-GAAP net income of $10.9 million, or $0.37 per diluted common share, in the third quarter of 2015. A reconciliation of non-GAAP and GAAP results is included in the financial tables below.
Results for the nine months ended September 30, 2016
Total revenue rose to $239.0 million for the first nine months of 2016, an increase of 26% compared to $189.3 million for the first nine months of 2015.
Net loss for the first nine months of 2016 was $(5.0) million, or $(0.17) per basic and diluted common share, compared to a net loss of $(11.4) million, or $(0.39) per basic and diluted common share for the first nine months of 2015.
On a non-GAAP basis, net income for the first nine months of 2016 was $42.4 million, or $1.39 per diluted common share, compared to non-GAAP net income of $27.9 million, or $0.94 per diluted common share, for the first nine months of 2015. A reconciliation of non-GAAP and GAAP results is included in the financial tables below.
Management Commentary
“I’m pleased to report another strong financial quarter as we achieved 22% year-over-year revenue and significant earnings per share growth,” said Michael Tessler, president and chief executive officer, BroadSoft. “It was also a great quarter from a customer traction perspective. We saw several major product launches by our customers, including a VoLTE-based mobile offering by a major carrier. We believe that these launches, and our customers’ continued success in the market, highlight the strategic value of our solutions.”
Guidance
For the fourth quarter of 2016, BroadSoft anticipates revenue of $94 to $102 million. BroadSoft also expects to achieve earnings on a non-GAAP basis of $0.65 to $0.83 per diluted common share. For the full year 2016, BroadSoft expects revenue in the range of $333 million to $341 million and non-GAAP EPS in the range of $2.04 to $2.22.
A reconciliation of non-GAAP earnings per share guidance, as well as projected non-GAAP cost of sales and operating expenses to be discussed on this morning’s teleconference, to the closest corresponding GAAP measures, is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures, in particular, the measures and effects of non-cash income taxes and stock-based compensation expense. We expect the variability of the above charges to have a significant, and potentially unpredictable, impact on our future GAAP financial results.
Conference Call
BroadSoft will discuss its third quarter 2016 results and its business outlook today via teleconference at 8:30 a.m. Eastern Time. To participate in the teleconference, callers can dial the toll free number 1-877-312-5517 (U.S. callers only) or 1-760-666-3772 (from outside the U.S.). The conference call can also be heard live via audio webcast at http://investors.broadsoft.com/events.cfm. To help ensure the conference begins on time, please dial in or connect via the web five minutes prior to the scheduled start time.
For those unable to participate in the live call, a recording will be available shortly after the conclusion of the call at http://investors.broadsoft.com/events.cfm and will remain available until immediately prior to our next earnings call.
About BroadSoft
BroadSoft is the technology innovator in cloud communication, collaboration, and contact center solutions for businesses and service providers across 80 countries. We are the market share leader for cloud unified communications with an open, mobile and secure platform trusted by 25 of the world’s top 30 service providers by revenue. BroadSoft Business empowers users and teams to share ideas and work simply to achieve breakthrough performance.
Financial Statements
The financial statements set forth below are not the complete set of BroadSoft’s financial statements for the quarter and the year and are presented below without footnotes. Readers are encouraged to obtain and carefully review BroadSoft’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016, including all financial statements contained therein and the footnotes thereto, once the report is filed with the SEC. Once filed with the SEC, the Form 10-Q may be retrieved from the SEC’s website at www.sec.gov or from BroadSoft’s website at www.broadsoft.com.