NEWTON, Mass. & PETACH TIKVA, Israel--(BUSINESS WIRE)--CyberArk (NASDAQ: CYBR), the global leader in privileged access management, today announced financial results for the third quarter ended September 30, 2020.

“We are pleased with the momentum in the business including posting another quarter of record SaaS bookings,” said Udi Mokady, CyberArk Chairman and CEO. “Enterprise demand for our SaaS solutions continued to build in the third quarter, particularly for CyberArk Privilege Cloud and Endpoint Privilege Manager. Customers are increasingly turning to CyberArk as their trusted advisor to securely implement digital transformation, cloud migration, and identity and risk reduction programs. Our ongoing cloud innovation, including CyberArk Cloud Entitlements Manager, our recently introduced AI-powered solution that strengthens cloud security, further extends our leadership position in the market.The significant increase in new SaaS and subscription bookings grew our annual recurring revenue (ARR) by 40 percent to $250 million and our deferred revenue by 28 percent to $228 million. In addition, the combination of SaaS and subscription revenue increased nearly 200 percent year over year and represents about 28 percent of total license revenue compared to 7 percent of license revenue in the third quarter of 2019. While the bookings mix shift toward high-value recurring subscriptions created a headwind to our recognized revenue and profitability in the quarter, looking through the near-term effect on the reported P&L, our business performance was strong and the level of customer and prospect engagement was at an all-time high.”

Continued Mokady, “As we look ahead, we will begin actively transitioning our business to a recurring revenue model in 2021, by further accelerating our SaaS business and shifting the Company sales from perpetual licenses to recurring subscriptions. As a result of our robust SaaS and subscription bookings, our strong and growing mix of recurring revenue, our expanding SaaS portfolio, and our comprehensive review of enterprise buying patterns, we are confident that our strategy will create significant long-term value for CyberArk, our customers, partners, and shareholders.”

Financial Highlights for the Third Quarter Ended September 30, 2020

Revenue:

• Total revenue was $106.6 million.
• License revenue was $45.8 million.
• Maintenance and professional services revenue was $60.8 million.

Operating Income (Loss):

• GAAP operating loss was $(10.5) million and non-GAAP operating income was $13.1 million.

Net Income (Loss):

• GAAP net loss was $(15.9) million, or $(0.41) per basic and diluted share. Non-GAAP net income was $12.2 million, or $0.31 per diluted share.

The tables at the end of this press release include a reconciliation of GAAP to non-GAAP gross profit, operating income (loss) and net income (loss) for the three months and nine months ended September 30, 2020 and 2019. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

Balance Sheet and Cash Flow:

• As of September 30, 2020, CyberArk had $1.1 billion in cash, cash equivalents, marketable securities and short-term deposits. This compares to $555.1 million at September 30, 2019.
• As of September 30, 2020, total deferred revenue was $227.6 million, a 28% increase from $177.3 million at September 30, 2019.
• During the nine months ended September 30, 2020, the Company generated $67.8 million in net cash provided by operating activities, compared to $88.6 million in the first nine months of 2019.

Annual Recurring Revenue (ARR):

• Annual Recurring Revenue (ARR) was $250 million, an increase of 40% from $178 million at September 30, 2019.

Recent Business Highlights

• CyberArk was named a Leader in the Gartner 2020 Magic Quadrant for Privileged Access Management*
• Introduced general availability of CyberArk Cloud Entitlements Manager, our latest SaaS solution, an AI-Powered service to remove excessive cloud permissions
• Strengthened ability to secure identities and privileged credentials in the cloud:
  • Availability on Microsoft Azure
  • Achieved AWS Digital Workplace Competency Status
  • Achieved AWS Outposts Ready designation

(*) Gartner, Magic Quadrant for Privileged Access Management, Felix Gaehtgens, Abhyuday Data, Michael Kelley, 4 August 2020

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

Business Outlook

Based on information available as of November 10, 2020, CyberArk is issuing guidance for the fourth quarter as indicated below.

Fourth Quarter 2020:

• Total revenue between $125.0 million and $135.0 million.
• Non-GAAP operating income between $25.0 million and $33.0 million.
• Non-GAAP net income per share between $0.52 and $0.67 per diluted share.
  • Estimated tax rate of 23 percent.
  • Assumes 40.0 million weighted average diluted shares.

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.