Reports Strong Non-GAAP Revenue, Non-GAAP EPS, and Cash
Flow
Nuance Communications, Inc. (NASDAQ: NUAN) today announced
financial results for its first quarter fiscal 2016, ended December
31, 2015.
In the first quarter of fiscal 2016, Nuance reported GAAP
revenue of $486.1 million, up from $474.0 million a year ago.
Nuance reported non-GAAP revenue of $494.9 million, which includes
$8.8 million of revenue lost to accounting treatment in conjunction
with acquisitions, compared to $489.0 million in the first quarter
of fiscal 2015. First quarter 2016 revenue was negatively affected
by currency fluctuations as well. If first quarter 2015 currency
rates were applied to first quarter 2016 non-GAAP revenue, Nuance
would have achieved approximately 2% organic non-GAAP revenue
growth for the quarter. In the first quarter of 2016, total
non-GAAP recurring revenue was $332.5 million and represented 67%
of total non-GAAP revenue, compared to $321.7 million and 66% a
year ago. In the first quarter of fiscal 2016, Nuance reported net
new bookings of $308.7 million, up 2% from $303.8 million a year
ago. If first quarter 2015 currency rates were applied to first
quarter 2016 net new bookings, net new bookings would have been up
approximately 7% from a year ago.
In the first quarter of fiscal 2016, Nuance recognized GAAP net
loss of $(12.1) million, or $(0.04) per share, compared to GAAP net
loss of $(50.5) million, or $(0.16) per share, in the first quarter
of fiscal 2015. Nuance reported non-GAAP net income of $113.0
million, or $0.36 per diluted share, up from non-GAAP net income of
$82.0 million, or $0.25 per diluted share, in the first quarter of
fiscal 2015. Nuance’s first quarter fiscal 2016 non-GAAP operating
margin was 28.6%, up from 22.0% in the first quarter of fiscal
2015. Nuance reported cash flow from operations of $141.1 million
in the first quarter of fiscal 2016, up 48% from $95.7 million in
the first quarter of fiscal 2015.
“In our first quarter, Nuance delivered strong revenue, non-GAAP
EPS, and cash flow from operations,” said Dan Tempesta, Nuance’s
CFO. “We continued to make substantial progress and
achieve meaningful results from our formal transformation
program. The entire organization is committed to ongoing
performance enhancements that will lead us to improve growth,
margins and shareholder value.”
Please refer to the “Discussion of Non-GAAP Financial Measures”
and to the “GAAP to Non-GAAP Reconciliations,” included elsewhere
in this release, for more information regarding the company’s use
of non-GAAP measures.
Conference Call and Prepared Remarks
Nuance is providing a copy of prepared remarks in combination
with its press release. These remarks are offered to provide
shareholders and analysts with additional time and detail for
analyzing results in advance of the company’s quarterly conference
call. The remarks will be available at
http://www.nuance.com/earnings-results/ in conjunction with the
press release.
Nuance will host an investor conference call today that will
begin at 5:00 p.m. EST and will include only brief comments
followed by questions and answers. To access the live broadcast,
please visit the Investor Relations section of Nuance’s website at
www.nuance.com. The call can also be heard by dialing 800-553-0358
or 612-332-0636 at least five minutes prior to the call and
referencing code 384849. A replay will be available within 24 hours
of the announcement by dialing 800-475-6701 or 320-365-3844 and
using the access code 384849.
Nuance is providing a copy of prepared remarks in combination
with its press release. These remarks are offered to provide
shareholders and analysts with additional time and detail for
analyzing results in advance of the company’s quarterly conference
call. The remarks will be available at
http://www.nuance.com/earnings-results/ in conjunction with the
press release.
About Nuance Communications, Inc.
Nuance Communications, Inc. (NASDAQ: NUAN) is a leading provider
of voice and language solutions for businesses and consumers around
the world. Its technologies, applications and services make the
user experience more compelling by transforming the way people
interact with devices and systems. Every day, millions of users and
thousands of businesses experience Nuance’s proven applications.
For more information, please visit www.nuance.com.
Trademark reference: Nuance and the Nuance logo are registered
trademarks or trademarks of Nuance Communications, Inc. or its
affiliates in the United States and/or other countries. All other
trademarks referenced herein are the property of their respective
owners.
Definitions of Bookings and Net New Bookings
Bookings represent the estimated gross revenue value of
transactions at the time of contract execution, except for
maintenance and support offerings. For fixed price contracts, the
bookings value represents the gross total contract value. For
contracts where revenue is based on transaction volume, the
bookings value represents the contract price multiplied by the
estimated future transaction volume during the contract term,
whether or not such transaction volumes are guaranteed under a
minimum commitment clause. Actual results could be different than
our initial estimates. The maintenance and support bookings value
represents the amounts billed in the period the customer is
invoiced. Because of the inherent estimates required to determine
bookings and the fact that the actual resultant revenue may differ
from our initial bookings estimates, we consider bookings one
indicator of potential future revenue and not as an arithmetic
measure of backlog.
Net new bookings represents the estimated revenue value at the
time of contract execution from new contractual arrangements or the
estimated revenue value incremental to the portion of value that
will be renewed under pre-existing arrangements. Constant currency
for net new bookings is calculated using current period net new
bookings denominated in currencies other than United States
dollars, converted into United States dollars using the average
exchange rate for those currencies from the prior year period
rather than the actual exchange rate in effect during the current
period.
Definitions of Non-GAAP Organic Revenue Growth
Organic revenue growth is calculated by comparing current period
non-GAAP revenue to non-GAAP revenue from the corresponding
prior-year period. For purposes of this calculation, prior period
non-GAAP revenue is adjusted to include revenue from companies
acquired by Nuance as if we had owned the acquired businesses in
all periods presented. Non-GAAP organic revenue growth on a
constant currency basis is calculated using current period non-GAAP
revenue for entities reporting in currencies other than United
States dollars, excluding United States dollar denominated
transactions recorded in those entities, converted into United
States dollars using the average exchange rates from the prior year
period rather than the actual exchange rates in effect during the
current period.
Safe Harbor and Forward-Looking Statements
Statements in this document regarding future performance and our
management’s future expectations, beliefs, goals, plans or
prospects constitute forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Any
statements that are not statements of historical fact (including
statements containing the words “believes,” “plans,” “anticipates,”
“expects,” or “estimates” or similar expressions) should also be
considered to be forward-looking statements. There are a number of
important factors that could cause actual results or events to
differ materially from those indicated by such forward-looking
statements, including but not limited to: fluctuations in demand
for our existing and future products; changes to economic
conditions in the United States and internationally; fluctuating
currency rates, our ability to control and successfully manage our
expenses and cash position; our ability to execute our formal
transformation program to reduce costs and optimize processes; the
effects of competition, including pricing pressure; possible
quality issues in our products and technologies; our ability to
successfully integrate operations and employees of acquired
businesses; the conversion rate of bookings into revenue; the
ability to realize anticipated synergies from acquired businesses;
and the other factors described in our annual report on Form 10-K
for the fiscal year ended September 30, 2015 and our quarterly
reports, and other reports filed with the Securities and Exchange
Commission. We disclaim any obligation to update any
forward-looking statements as a result of developments occurring
after the date of this document.
The information included in this press release should not be
considered superior to, or a substitute for, financial statements
prepared in accordance with GAAP.
Discussion of Non-GAAP Financial Measures
We utilize a number of different financial measures, both
Generally Accepted Accounting Principles (“GAAP”) and non-GAAP, in
analyzing and assessing the overall performance of the business,
for making operating decisions and for forecasting and planning for
future periods. Our annual financial plan is prepared both on a
GAAP and non-GAAP basis, and the non-GAAP annual financial plan is
approved by our board of directors. Continuous budgeting and
forecasting for revenue and expenses are conducted on a consistent
non-GAAP basis (in addition to GAAP) and actual results on a
non-GAAP basis are assessed against the non-GAAP annual financial
plan. The board of directors and management utilize these non-GAAP
measures and results (in addition to the GAAP results) to determine
our allocation of resources. In addition and as a consequence of
the importance of these measures in managing the business, we use
non-GAAP measures and results in the evaluation process to
establish management’s compensation. For example, our annual bonus
program payments are based upon the achievement of consolidated
non-GAAP revenue and consolidated non-GAAP earnings per share
financial targets. We consider the use of non-GAAP revenue helpful
in understanding the performance of our business, as it excludes
the purchase accounting impact on acquired deferred revenue and
other acquisition-related adjustments to revenue. We also consider
the use of non-GAAP earnings per share helpful in assessing the
organic performance of the continuing operations of our business.
By organic performance we mean performance as if we had owned an
acquired business in the same period a year ago. By constant
currency organic performance we mean performance excluding the
effect of current foreign currency rate fluctuations. By continuing
operations we mean the ongoing results of the business excluding
certain unplanned costs. While our management uses these non-GAAP
financial measures as a tool to enhance their understanding of
certain aspects of our financial performance, our management does
not consider these measures to be a substitute for, or superior to,
the information provided by GAAP financial statements. Consistent
with this approach, we believe that disclosing non-GAAP financial
measures to the readers of our financial statements provides such
readers with useful supplemental data that, while not a substitute
for GAAP financial statements, allows for greater transparency in
the review of our financial and operational performance. In
assessing the overall health of the business during the three
months ended December 31, 2015 and 2014, our management has either
included or excluded items in six general categories, each of which
is described below.
Acquisition-Related Revenue and Cost of Revenue.
We provide supplementary non-GAAP financial measures of revenue,
which include revenue related to acquisitions, primarily from
Notable Solutions, Quantim and Equitrac for the three months ended
December 31, 2015 that would otherwise have been recognized but for
the purchase accounting treatment of these transactions. Non-GAAP
revenue also includes revenue that we would have otherwise
recognized had we not acquired intellectual property and other
assets from the same customer. Because GAAP accounting requires the
elimination of this revenue, GAAP results alone do not fully
capture all of our economic activities. These non-GAAP adjustments
are intended to reflect the full amount of such revenue. We include
non-GAAP revenue and cost of revenue to allow for more complete
comparisons to the financial results of historical operations,
forward-looking guidance and the financial results of peer
companies. We believe these adjustments are useful to management
and investors as a measure of the ongoing performance of the
business because, although we cannot be certain that customers will
renew their contracts, we have historically experienced high
renewal rates on maintenance and support agreements and other
customer contracts. Additionally, although acquisition-related
revenue adjustments are non-recurring with respect to past
acquisitions, we generally will incur these adjustments in
connection with any future acquisitions.
Acquisition-Related Costs, Net.
In recent years, we have completed a number of acquisitions,
which result in operating expenses which would not otherwise have
been incurred. We provide supplementary non-GAAP financial
measures, which exclude certain transition, integration and other
acquisition-related expense items resulting from acquisitions, to
allow more accurate comparisons of the financial results to
historical operations, forward-looking guidance and the financial
results of less acquisitive peer companies. We consider these types
of costs and adjustments, to a great extent, to be unpredictable
and dependent on a significant number of factors that are outside
of our control. Furthermore, we do not consider these
acquisition-related costs and adjustments to be related to the
organic continuing operations of the acquired businesses and are
generally not relevant to assessing or estimating the long-term
performance of the acquired assets. In addition, the size,
complexity and/or volume of past acquisitions, which often drives
the magnitude of acquisition-related costs, may not be indicative
of the size, complexity and/or volume of future acquisitions. By
excluding acquisition-related costs and adjustments from our
non-GAAP measures, management is better able to evaluate our
ability to utilize our existing assets and estimate the long-term
value that acquired assets will generate for us. We believe that
providing a supplemental non-GAAP measure which excludes these
items allows management and investors to consider the ongoing
operations of the business both with, and without, such
expenses.
These acquisition-related costs are included in the following
categories: (i) transition and integration costs; (ii) professional
service fees; and (iii) acquisition-related adjustments. Although
these expenses are not recurring with respect to past acquisitions,
we generally will incur these expenses in connection with any
future acquisitions. These categories are further discussed as
follows:
(i) Transition and integration costs. Transition and integration
costs include retention payments, transitional employee costs,
earn-out payments treated as compensation expense, as well as the
costs of integration-related services, including services provided
by third parties.
(ii) Professional service fees. Professional service fees
include third party costs related to the acquisition, and legal and
other professional service fees associated with disputes and
regulatory matters related to acquired entities.
(iii) Acquisition-related adjustments. Acquisition-related
adjustments include adjustments to acquisition-related items that
are required to be marked to fair value each reporting period, such
as contingent consideration, and other items related to
acquisitions for which the measurement period has ended, such as
gains or losses on settlements of pre-acquisition
contingencies.
Amortization of Acquired Intangible Assets.
We exclude the amortization of acquired intangible assets from
non-GAAP expense and income measures. These amounts are
inconsistent in amount and frequency and are significantly impacted
by the timing and size of acquisitions. Providing a supplemental
measure which excludes these charges allows management and
investors to evaluate results “as-if” the acquired intangible
assets had been developed internally rather than acquired and,
therefore, provides a supplemental measure of performance in which
our acquired intellectual property is treated in a comparable
manner to our internally developed intellectual property. Although
we exclude amortization of acquired intangible assets from our
non-GAAP expenses, we believe that it is important for investors to
understand that such intangible assets contribute to revenue
generation. Amortization of intangible assets that relate to past
acquisitions will recur in future periods until such intangible
assets have been fully amortized. Future acquisitions may result in
the amortization of additional intangible assets.
Costs Associated with IP Collaboration Agreement.
In order to gain access to a third party's extensive speech
recognition technology and natural language and semantic processing
technology, we have entered into IP collaboration agreements, with
terms ranging between five and six years. Depending on the
agreement, some or all intellectual property derived from these
collaborations will be jointly owned by the two parties. For the
majority of the developed intellectual property, we will have sole
rights to commercialize such intellectual property for periods
ranging between two to six years, depending on the agreement. For
non-GAAP purposes, we consider these long-term contracts and the
resulting acquisitions of intellectual property from this
third-party over the agreements’ terms to be an investing activity,
outside of our normal, organic, continuing operating activities,
and are therefore presenting this supplemental information to show
the results excluding these expenses. We do not exclude from our
non-GAAP results the corresponding revenue, if any, generated from
these collaboration efforts. Although our bonus program and other
performance-based incentives for executives are based on the
non-GAAP results that exclude these costs, certain engineering
senior management are responsible for execution and results of the
collaboration agreement and have incentives based on those results.
Costs associated with the research and development portion of the
agreements have been excluded from research and development expense
while costs for the extension of the marketing exclusivity period
are excluded from sales and marketing expense.
Non-Cash Expenses.
We provide non-GAAP information relative to the following
non-cash expenses: (i) stock-based compensation; (ii) certain
accrued interest; and (iii) certain accrued income taxes. These
items are further discussed as follows:
(i) Stock-based compensation. Because of varying available
valuation methodologies, subjective assumptions and the variety of
award types, we believe that the exclusion of stock-based
compensation allows for more accurate comparisons of operating
results to peer companies, as well as to times in our history when
stock-based compensation was more or less significant as a portion
of overall compensation than in the current period. We evaluate
performance both with and without these measures because
compensation expense related to stock-based compensation is
typically non-cash and the options and restricted awards granted
are influenced by the Company’s stock price and other factors such
as volatility that are beyond our control. The expense related to
stock-based awards is generally not controllable in the short-term
and can vary significantly based on the timing, size and nature of
awards granted. As such, we do not include such charges in
operating plans. Stock-based compensation will continue in future
periods.
(ii) and (iii) Certain accrued interest and income taxes. We
also exclude certain accrued interest and certain accrued income
taxes because we believe that excluding these non-cash expenses
provides senior management, as well as other users of the financial
statements, with a valuable perspective on the cash-based
performance and health of the business, including the current
near-term projected liquidity. These non-cash expenses will
continue in future periods.
Other Expenses.
We exclude certain other expenses that are the result of
unplanned events to measure operating performance and current and
future liquidity both with and without these expenses; and
therefore, by providing this information, we believe management and
the users of the financial statements are better able to understand
the financial results of what we consider to be our organic,
continuing operations. Included in these expenses are items such as
restructuring charges, asset impairments and other charges
(credits), net. These events are unplanned and arose outside of the
ordinary course of continuing operations. These items include
losses from the extinguishment of our convertible debt and
adjustments from changes in fair value of share-based instruments
relating to the issuance of our common stock with security price
guarantees payable in cash. Other items such as consulting and
professional services fees related to assessing strategic
alternatives and our transformation program, and gains or losses on
non-controlling strategic equity interests, are also excluded.
We believe that providing the non-GAAP information to investors,
in addition to the GAAP presentation, allows investors to view the
financial results in the way management views the operating
results. We further believe that providing this information allows
investors to not only better understand our financial performance,
but more importantly, to evaluate the efficacy of the methodology
and information used by management to evaluate and measure such
performance.
Nuance Communications, Inc. Condensed Consolidated
Statements of Operations (in thousands, except per share amounts)
Unaudited Three months ended December 31, 2015
2014
Revenues: Product
and licensing $ 179,050 $ 169,688 Professional services and hosting
227,135 226,170 Maintenance and support 79,930
78,161 Total revenues 486,115 474,019
Cost of revenues: Product and licensing 23,412
23,970 Professional services and hosting 153,544 157,243
Maintenance and support 13,322 14,041 Amortization of intangible
assets 15,631 15,131 Total cost of
revenues 205,909 210,385 Gross
profit 280,206 263,634
Operating expenses: Research and development 71,060 82,567
Sales and marketing 100,590 111,250 General and administrative
39,655 50,567 Amortization of intangible assets 27,033 26,827
Acquisition-related cost, net 2,480 4,756 Restructuring and other
charges, net 7,888 2,228 Total
operating expenses 248,706 278,195
Income (loss) from operations 31,500 (14,561 ) Other
expense, net (35,798 ) (30,120 ) Loss before
income taxes (4,298 ) (44,681 ) Provision for income taxes
7,767 5,814 Net loss $ (12,065 )
$ (50,495 )
Net loss per share: Basic $ (0.04 ) $
(0.16 ) Diluted $ (0.04 ) $ (0.16 )
Weighted average
common shares outstanding: Basic 307,794
321,751 Diluted 307,794 321,751
Nuance Communications, Inc. Condensed Consolidated
Balance Sheets (in thousands) Unaudited
ASSETS
December 31, 2015 September 30, 2015 Current assets:
Cash and cash equivalents $ 506,653 $ 479,449 Marketable securities
59,783 57,237 Accounts receivable, net 374,333 373,162 Prepaid
expenses and other current assets 93,790 76,777 Total
current assets 1,034,559 986,625 Marketable securities
29,434 32,099 Land, building and equipment, net 186,719 186,007
Goodwill 3,369,953 3,378,334 Intangible assets, net 753,835 796,285
Other assets 156,128 148,301 Total assets $ 5,530,628
$ 5,527,651
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Current portion of long-term debt $ - $
4,834 Contingent and deferred acquisition payments 16,858 15,651
Accounts payable and accrued expenses 215,333 281,190 Deferred
revenue 370,787 324,709 Total current liabilities
602,978 626,384 Long-term portion of debt 2,119,825
2,118,821 Deferred revenue, net of current portion 361,893 343,452
Other liabilities 177,900 173,742 Total liabilities
3,262,596 3,262,399 Stockholders' equity
2,268,032 2,265,252 Total liabilities and
stockholders' equity $ 5,530,628 $ 5,527,651 Nuance
Communications, Inc. Consolidated Statements of Cash Flows (in
thousands) Unaudited Three months ended December 31,
2015 2014
Cash flows
from operating activities: Net loss $ (12,065 ) $ (50,495 )
Adjustments to reconcile net loss to net cash provided by operating
activities: Depreciation and amortization 58,275 57,173 Stock-based
compensation 42,348 47,354 Non-cash interest expense 8,636 7,379
Deferred tax (benefit) provision (351 ) 1,887 Loss on
extinguishment of debt 4,851 - Other 393 (182 ) Changes in
operating assets and liabilities, net of effects from acquisitions:
Accounts receivable (3,894 ) 7,243 Prepaid expenses and other
assets (20,097 ) (14,658 ) Accounts payable (5,940 ) (2,559 )
Accrued expenses and other liabilities 305 (36,226 ) Deferred
revenue 68,680 78,769 Net cash provided
by operating activities 141,141 95,685
Cash flows from investing activities: Capital expenditures
(20,555 ) (16,937 ) Payments for business and technology
acquisitions, net of cash acquired (674 ) (8,132 ) Purchases of
marketable securities and other investments (17,070 ) (63,465 )
Proceeds from sales and maturities of marketable securities and
other investments 14,128 9,377 Net cash
used in investing activities (24,171 ) (79,157 )
Cash flows from financing activities: Payments of debt
(511,844 ) (1,209 ) Proceeds from issuance of convertible debt, net
of issuance costs 664,605 - Payments for repurchase of common stock
(189,580 ) - Payments for settlement of other share-based
derivatives - (340 ) Payments on other long-term liabilities (851 )
(695 ) Proceeds from issuance of common stock from employee stock
plans 36 177 Cash used to net share settle employee equity awards
(52,171 ) (42,654 ) Net cash used in financing
activities (89,805 ) (44,721 ) Effects of exchange
rate changes on cash and cash equivalents 39
(1,195 ) Net increase (decrease) in cash and cash equivalents
27,204 (29,388 ) Cash and cash equivalents at beginning of period
479,449 547,230 Cash and cash
equivalents at end of period $ 506,653 $ 517,842
Nuance Communications, Inc. Supplemental Financial
Information - GAAP to Non-GAAP Reconciliations (in thousands,
except per share amounts) Unaudited Three months
ended December 31, 2015 2014
GAAP revenues $ 486,115 $ 474,019 Acquisition-related
revenue adjustments: product and licensing 5,993 10,616
Acquisition-related revenue adjustments: professional services and
hosting 2,528 3,796 Acquisition-related revenue adjustments:
maintenance and support 234 599
Non-GAAP revenues $ 494,870 $ 489,030
GAAP cost of revenues $ 205,909 $ 210,385 Cost of revenues
from amortization of intangible assets (15,631 ) (15,131 ) Cost of
revenues adjustments: product and licensing (1,2) (122 ) 319 Cost
of revenues adjustments: professional services and hosting (1,2)
(7,591 ) (7,308 ) Cost of revenues adjustments: maintenance and
support (1,2) (1,068 ) (943 )
Non-GAAP cost of
revenues $ 181,497 $ 187,322
GAAP gross
profit $ 280,206 $ 263,634 Gross profit adjustments
33,167 38,074
Non-GAAP gross profit $
313,373 $ 301,708
GAAP income (loss) from
operations $ 31,500 $ (14,561 ) Gross profit adjustments 33,167
38,074 Research and development (1) 9,933 10,509 Sales and
marketing (1) 12,837 12,534 General and administrative (1) 10,631
15,658 Amortization of intangible assets 27,033 26,827 Costs
associated with IP collaboration agreements 2,000 2,938
Acquisition-related costs, net 2,480 4,756 Restructuring and other
charges, net 7,888 2,228 Other 3,850 8,833
Non-GAAP income from operations $ 141,319 $
107,796
GAAP provision for income taxes $
7,767 $ 5,814 Non-cash taxes (1,612 ) (2,159 )
Non-GAAP provision for income taxes $ 6,155 $ 3,655
GAAP net loss $ (12,065 ) $ (50,495 )
Acquisition-related adjustment - revenues (2) 8,755 15,011
Acquisition-related adjustment - cost of revenues (2) (166 ) (721 )
Acquisition-related costs, net 2,480 4,756 Cost of revenue from
amortization of intangible assets 15,631 15,131 Amortization of
intangible assets 27,033 26,827 Restructuring and other charges,
net 7,888 2,228 Non-cash stock-based compensation (1) 42,348 47,354
Non-cash interest expense 8,636 7,379 Non-cash income taxes 1,612
2,159 Costs associated with IP collaboration agreements 2,000 2,938
Change in fair value of share-based instruments - 561 Loss on
extinguishment of debt 4,851 - Other 4,010
8,833
Non-GAAP net income $ 113,013 $ 81,961
Non-GAAP diluted net income per share $ 0.36
$ 0.25
Diluted weighted average common
shares outstanding 314,371 328,688
Nuance Communications, Inc. Supplemental Financial
Information - GAAP to Non-GAAP Reconciliations, continued (in
thousands) Unaudited Three months ended December 31,
2015 2014
(1) Non-cash
stock-based compensation
Cost of product and licensing
$ 122 $ 87 Cost of professional services and hosting 7,757 7,623
Cost of maintenance and support 1,068 943 Research and development
9,933 10,509 Sales and marketing 12,837 12,534 General and
administrative 10,631 15,658 Total $
42,348 $ 47,354
(2)
Acquisition-related revenue and cost of revenue
Revenues $ 8,755 $ 15,011 Cost of product and licensing - (406 )
Cost of professional services and hosting (166 ) (315
) Total $ 8,589 $ 14,290 Nuance
Communications, Inc. Supplemental Financial Information – GAAP to
Non-GAAP Reconciliations, continued (in millions) Unaudited
Perpetual Product
and Licensing Revenue
FY FY FY Q1
Q2 Q3 Q4 FY
Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenue $ 584.1 $ 578.1 $ 496.6 $ 117.0 $ 121.3 $
108.1 $ 115.9 $ 462.1 $ 115.2 Adjustment 73.9 45.7
21.7 2.2 4.6 3.6 2.4 13.0
2.0 Non-GAAP Revenue $ 658.0 $ 623.8 $ 518.3 $ 119.2 $ 125.9
$ 111.7 $ 118.3 $ 475.2 $ 117.2
Recurring Product
and Licensing Revenue
FY FY FY Q1 Q2 Q3
Q4 FY Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenue $ 156.6 $ 175.6 $ 214.4 $ 52.7 $ 53.2 $
54.7 $ 73.5 $ 234.1 $ 63.9 Adjustment - 24.4
15.6 8.4 4.6 3.5 3.6 20.1
4.0 Non-GAAP Revenue $ 156.6 $ 200.0 $ 230.0 $ 61.1 $ 57.8 $ 58.2 $
76.9 $ 254.0 $ 67.9
Professional
Services Revenue
FY FY FY Q1 Q2 Q3
Q4 FY Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenue $ 183.1 $ 208.1 $ 220.7 $ 54.8 $ 51.2 $
51.2 $ 52.9 $ 210.0 $ 49.7 Adjustment 0.7 17.9
7.5 0.4 0.4 0.4 0.3 1.5
0.3 Non-GAAP Revenue $ 183.8 $ 226.0 $ 228.2 $ 55.2 $ 51.6 $ 51.6 $
53.2 $ 211.5 $ 50.0
Hosting
Revenue
FY FY FY Q1 Q2 Q3
Q4 FY Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenue $ 490.9 $ 624.3 $ 690.2 $ 171.4 $ 173.3 $
183.1 $ 181.7 $ 709.5 $ 177.4 Adjustment 5.3 9.3
15.6 3.4 2.9 2.8 2.4 11.5
2.3 Non-GAAP Revenue $ 496.2 $ 633.6 $ 705.8 $ 174.8 $ 176.2
$ 185.9 $ 184.2 $ 721.2 $ 179.7
Maintenance and
Support Revenue
FY FY FY Q1 Q2 Q3
Q4 FY Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenue $ 236.8 $ 269.2 $ 301.6 $ 78.2 $ 76.1 $
80.9 $ 80.2 $ 315.4 $ 79.9 Adjustment 6.7 5.1
3.2 0.6 0.5 0.4 0.3 1.8
0.2 Non-GAAP Revenue $ 243.5 $ 274.3 $ 304.8 $ 78.8 $ 76.6 $ 81.3 $
80.6 $ 317.1 $ 80.2
Total Recurring
Revenues
FY FY FY Q1 Q2 Q3
Q4 FY Q1 2012 2013
2014 2015 2015
2015 2015 2015
2016 GAAP Revenues $ 896.7 $ 1,087.4 $ 1,228.4 $ 308.9 $
307.5 $ 323.6 $ 340.5 $ 1,280.5 $ 326.1 Adjustment 12.2
40.2 34.9 12.7 8.1 6.8
6.5 34.1 6.4 Non-GAAP Revenues $ 908.8 $ 1,127.6 $
1,263.3 $ 321.7 $ 315.6 $ 330.4 $ 347.0 $ 1,314.7 $ 332.5
Schedules may not add due to rounding.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160209006689/en/
For InvestorsNuance Communications, Inc.Richard Mack,
781-565-5000richard.mack@nuance.comorFor PressNuance
Communications, Inc.Rebecca Paquette,
781-565-5000rebecca.paquette@nuance.com
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