NEWTON, Mass. & PETACH TIKVA, Israel--(BUSINESS WIRE)--CyberArk (NASDAQ:CYBR), the global leader in privileged access management, today announced financial results for the first quarter ended March 31, 2020.

“The health and well-being of our global community of employees, customers and partners continues to be our first priority,” said Udi Mokady, CyberArk Chairman and CEO. “We were pleased to deliver results in line with or exceeding all guided metrics for the first quarter. Privileged Access Management (PAM) is even more critical today with attackers exploiting the sudden and dramatic change in enterprise IT created by remote work environments. In this higher threat environment, our level of engagement with customers has increased as they look to better secure their extended enterprise by expanding their PAM programs. Given our leadership position in PAM, our team’s extensive experience during prior market downturns as well as our ongoing commitment to innovation and customer satisfaction, we believe that we will emerge from the COVID-19 pandemic stronger than before. We are also pleased with today’s acquisition of Idaptive, which positions us as the only modern identity security platform, adds another SaaS offering to our portfolio, and expands our Total Addressable Market.”

“Given the weakened economic environment due to Covid-19, we expect customers to make more cautious purchasing decisions which will impact our revenue and cash flow from operations in the near term,” stated Josh Siegel, CyberArk Chief Financial Officer. “We believe deal close rates, particularly for new business and in certain verticals, will be less predictable and have therefore decided to withdraw our full year 2020 guidance. We continue to believe in the long-term growth opportunity given that Privileged Access Management is a priority for customers. The management team remains focused on delivering growth and profitability in 2020. As we monitor COVID-19 developments, our current plan is to manage expenses for the full year to better align with our top line, but also make disciplined investments and hire for key roles. We believe this approach will allow CyberArk to navigate through the current environment and prepare the Company for accelerated growth when the business environment stabilizes.”

Financial Highlights for the First Quarter Ended March 31, 2020

Revenue:

• Total revenue was $106.8 million, up 11% compared with the first quarter of 2019.
• License revenue was $51.7 million, up from $51.3 million in the first quarter of 2019.
• Maintenance and professional services revenue was $55.2 million, compared to $44.7 million in the first quarter of 2019.

Operating Income:

• GAAP operating income was $2.6 million, compared to $13.6 million in the first quarter of 2019. Non-GAAP operating income was $21.5 million, compared to $25.5 million in the first quarter of 2019.

Net Income:

• GAAP net income was $2.4 million, or $0.06 per diluted share, compared to GAAP net income of $13.7 million, or $0.36 per diluted share, in the first quarter of 2019. Non-GAAP net income was $19.6 million, or $0.50 per diluted share, compared to $21.5 million, or $0.56 per diluted share, in the first quarter of 2019.

The tables at the end of this press release include a reconciliation of GAAP to non-GAAP gross profit, operating income and net income for the three months ended March 31, 2020 and 2019. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

Balance Sheet and Net Cash Provided by Operating Activities:

• As of March 31, 2020, CyberArk had $1.2 billion in cash, cash equivalents, marketable securities and short-term deposits. This compares with $509.7 million in cash, cash equivalents, marketable securities and short-term deposits as of March 31, 2019.
• As of March 31, 2020, total deferred revenue was $210.7 million, a 23% increase from $171.1 million at March 31, 2019.
• During the first quarter of 2020, the Company generated $33.8 million in net cash provided by operating activities, compared to $45.9 million in the first quarter of 2019.

CyberArk Acquires IDaptive Holdings, Inc.

• In a separate announcement, CyberArk announced the acquisition of Idaptive, a leading Identity as a Service (IDaaS) provider. Together, CyberArk and Idaptive will deliver the industry’s only modern identity platform with a security-first approach.

CyberArk’s COVID-19 Response: Business Operations

As the COVID-19 situation evolved, CyberArk quickly took action to protect its community of employees, customers and partners and is continually evolving its COVID-19 response plan. To date, following actions have been taken:

• Created an executive level task force to respond to the situation and monitor guidance from the World Health Organization, CDC as well as local authorities to shape the Company’s policies and guidelines.
• Closed offices and enabled all employees to work securely from home.
• Transitioned sales and marketing to focus on virtual and digital programs.
• Restricted non-essential business travel.

CyberArk’s COVID-19 Response: Customers, Partners and Community

• Transitioned support and service staff to be available from remote locations 24 hours a day, 7 days a week to help our customers and partners implement business continuity strategies in response to the COVID-19 pandemic.
• Converted the Company’s major customer events in the U.S. and Europe to a global virtual program.
• Adjusted our Security Services organization to deliver all services remotely.
• Offered CyberArk Alero to customers at no cost into June. Alero enables remote employees and contractors to securely access CyberArk.
• Published research from CyberArk Labs communicating information about how attackers are capitalizing on the disruptions caused by COVID-19.
• Donated to local charities to help support COVID-19 response efforts.

Business Outlook

Based on information available as of May 13, 2020, CyberArk is issuing guidance as indicated below:

Second Quarter 2020:

• Total revenue between $95.0 million and $105.0 million.
• Non-GAAP operating income between $7.0 million and $16.0 million, which includes expenses from the acquisition of Idaptive.
• Non-GAAP net income per share between $0.17 and $0.35 per diluted share, which includes expenses from the acquisition of Idaptive.
  • Assumes 39.4 million weighted average diluted shares.

Full Year 2020:

Given the uncertainty created by the COVID-19 pandemic as well as its impact on the overall economy, our business, our customers and our partners, we are withdrawing our full year 2020 guidance for total revenue, non-GAAP operating income, and non-GAAP earnings per share that we provided on February 12, 2020.

About CyberArk

CyberArk (NASDAQ:CYBR) is the global leader in privileged access management, a critical layer of IT security to protect data, infrastructure and assets across cloud and hybrid environments, and throughout the DevOps pipeline. CyberArk delivers the industry’s most complete solution to reduce risk created by privileged credentials and secrets. The Company is trusted by the world’s leading organizations, including more than 50 percent of the Fortune 500, to protect against external attackers and malicious insiders. A global company, CyberArk is headquartered in Petach Tikva, Israel, with U.S. headquarters located in Newton, Mass. The Company also has offices throughout the Americas, EMEA, Asia Pacific and Japan. To learn more about CyberArk, visit www.cyberark.com, read the CyberArk blogs or follow on Twitter via @CyberArk, LinkedIn or Facebook.