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MicroStrategy Announces Third Quarter 2011 Financial Results
Record $141.7 Million in Total Revenues
TYSONS CORNER, Va., Oct. 31, 2011 /PRNewswire/ -- MicroStrategy® Incorporated (Nasdaq: MSTR), a leading worldwide provider of business intelligence software, today announced financial results for the three-month period ended September 30, 2011 (the third quarter of its 2011 fiscal year).
Third quarter 2011 revenues were $141.7 million, the highest quarterly total revenues in Company history, versus $114.5 million for the third quarter of 2010, a 24% increase. Product licenses revenues for the third quarter of 2011 were $39.3 million versus $32.2 million for the third quarter of 2010, a 22% increase. Product support and other services revenues for MicroStrategy's core business intelligence (BI) business in the third quarter of 2011 were $96.6 million versus $77.8 million for the third quarter of 2010, a 24% increase.
Operating expenses for the third quarter of 2011 were $103.5 million versus $77.5 million for the third quarter of 2010, a 34% increase. The increase in operating expenses was primarily due to increased headcount and related expenses, particularly for engineering and sales personnel.
Net income for the third quarter of 2011 was $4.9 million, or $0.44 per share on a diluted basis, compared to $7.4 million, or $0.63 per share on a diluted basis, for the third quarter of 2010. Third quarter 2011 net income included a $3.4 million pre-tax gain on the sale of an equity investment.
For the third quarter of 2011, MicroStrategy's effective tax rate was 17% compared to 10% for the third quarter of 2010. The higher effective tax rate in the third quarter of 2011 was primarily attributable to certain discrete adjustments that were recorded in the third quarter of 2010, partially offset by stronger results outside the U.S. in the third quarter of 2011 compared to the same period in 2010.
As of September 30, 2011, MicroStrategy had cash and cash equivalents of $186.3 million versus $174.1 million as of December 31, 2010, an increase of $12.2 million. As of September 30, 2011, MicroStrategy had 8,268,079 shares of class A common stock and 2,492,830 shares of class B common stock outstanding.
MicroStrategy Expands Launch of New Mobile, Cloud and Social Media Technologies:
In September 2011, MicroStrategy unveiled several new technologies.
-- MicroStrategy announced the release of Cloud Personal(TM), a free
cloud-based business intelligence service. Cloud Personal combines the
Company's latest technology innovations - MicroStrategy Cloud(TM),
MicroStrategy Visual Insight(TM), and MicroStrategy Mobile(TM) -
enabling users to easily upload data to the MicroStrategy Cloud, analyze
it via rich visualizations, and share powerful insights with colleagues
or friends as a mobile application or web browser dashboard.
-- MicroStrategy introduced Wisdom(TM) for Facebook, a free application
that is now available worldwide for both the iPhone® and iPad® on the
Apple® iTunes® App Store, as well as in a web-based Facebook app
format. Wisdom organizes your Facebook content and provides insights
into your network of Facebook friends, so you do not have to contend
with information overload and can easily learn from the collective
experience of your friends.
-- MicroStrategy also introduced MicroStrategy Wisdom(TM), a cloud-based
application that injects social intelligence into the Facebook
applications of corporations.
-- MicroStrategy additionally announced Emma(TM), a new marketplace for
Facebook users. Emma enhances the concept of free classifieds by
attaching Facebook credentials to classified listings. Because everyone
in the Emma community has a Facebook profile, they can trade with more
confidence, whether they are buying or selling products and services or
engaging in social transactions such as finding a roommate or rideshare.
The launch of these new offerings followed the release in July 2011 of several other innovative MicroStrategy technologies designed to enable companies to capitalize on the big data, mobile, cloud, and social media trends that are transforming the way commerce is conducted.
-- The Company announced the general availability of MicroStrategy 9.2.1.
This latest release of the MicroStrategy Business Intelligence
Platform(TM) features a new product, MicroStrategy Transaction
Services(TM), which allows users to initiate actions and transactions
from a mobile device. MicroStrategy Transaction Services helps
companies increase the speed and productivity of their businesses by
building mobile apps that connect to back-end transactional systems and
databases.
-- MicroStrategy also announced the general availability of MicroStrategy
Cloud(TM), a cloud-based platform-as-a-service. MicroStrategy Cloud
enables rapid, cost-effective development of business intelligence and
mobile and social apps. Compared to traditional on-premises BI
approaches, MicroStrategy Cloud is faster to deploy, delivers
world-class performance, and offers significant financial advantages.
-- The Company introduced Gateway for Facebook, a new cloud-based service
that can interconnect enterprise IT environments and enterprise
applications with the Facebook social graph. Gateway for Facebook
converts the Facebook social graph data structure into a tabular data
structure, making it easier for enterprise applications like CRM,
marketing, service, sales, loyalty, and mobile applications to be
personalized using data from Facebook.
-- In connection with the Gateway for Facebook launch, MicroStrategy also
introduced Alert, a mobile Facebook application that gives Facebook
users a new way to follow all of their favorite celebrity and brand
Facebook pages. Alert presents users with a consolidated view of the
news, events, photos, and videos from their favorite pages, while
allowing users to organize those pages into customized groups.
New Customers and New Deals with Existing Customers in Q3 2011 Included:
Activision; Aeropostale; AIG Global Asset Management Holdings Corp.; Banco Espirito Santo; Bank Of America; Belgacom Group; CareSource Management Group Co.; Comcast Entertainment Group; CSC Holdings; Dana Farber Cancer Institute; Dell Computer Corporation; Deutsche Bank Securities; Diageo North America; Electronic Arts; Endo Pharmaceuticals; ESPN; Google; Grange Insurance; Groupon.com; Hannover Ruckversicherung AG; Kassenarztliche Bundesvereinigung; Kohl's Department Stores; MacIntosh Retail Group NV; McDonald's Corporation; MedStar Health; Mercer (US) Inc.; Metropolitan Life Insurance Co.; Navteq; Nedbank Ltd; Netflix; Olympus Corporation; Pacific Sunwear; PF Chang's China Bistro; Polo Ralph Lauren Corporation; Radio Shack Corporation; Rogers Communications Partnership; Salesforce.com; Securitas Direct AB; Shionogi & Co., Ltd.; Social Security Administration; Speedway SuperAmerica LLC; Standard & Poor's Corporation; Staples, Inc.; Starwood Hotels & Resorts Worldwide, Inc.; TARP Worldwide; and US Capitol Police.
Examples of Customer Deals from Q3 2011:
Pacific Sunwear
Pacific Sunwear, with headquarters in Anaheim, California, is a leading specialty retailer with more than 800 stores in 50 states and Puerto Rico. Pacific Sunwear employees, including executives, merchants and planners, rely on MicroStrategy dashboards to analyze key merchandise sales and inventory metrics, and make real-time business decisions. A recent expansion of MicroStrategy licenses will allow Pacific Sunwear to upgrade to 64-bit functionality to improve performance, scalability, and capacity to support their growing BI environment. Ad-hoc capabilities will also enable end-users to perform drill-down analyses, eliminating the reliance on IT to support the end-user community with reporting needs. Pacific Sunwear selected MicroStrategy for its ease-of-use, superior visualizations and analytical reporting capabilities, as well as its outstanding scalability for big data.
CareSource Management Group Co.
CareSource, based in Dayton, Ohio, is a major not-for-profit, public-sector managed healthcare company that offers services to roughly 870,000 members in Ohio and Michigan. A new MicroStrategy customer, CareSource has chosen the MicroStrategy platform to measure service quality within its provider network. CareSource plans to develop a reporting iPhone app built on the MicroStrategy Mobile platform that will allow employees to remotely access key Healthcare Effectiveness Data and Information Set (HEDIS) quality measures in a visual, intuitive way. The mobile app will leverage HEDIS measures, which are used by more than 90 percent of America's health plans to measure performance on important dimensions of care and service. MicroStrategy was chosen following an extensive analysis of competitive business intelligence products.
About MicroStrategy Incorporated
Founded in 1989, MicroStrategy is a leading provider of enterprise software platforms for business intelligence (BI), mobile intelligence, and social intelligence applications. MicroStrategy's BI platform enables leading organizations worldwide to analyze the vast amounts of data stored across their enterprises to make better business decisions. Companies choose MicroStrategy BI for its ease-of-use, sophisticated analytics, and superior data and user scalability. The MicroStrategy BI platform delivers actionable information to business users via the web and mobile devices. MicroStrategy's mobile intelligence platform helps companies and organizations build, deploy, and maintain mobile apps across a range of solutions by embedding intelligence, transactions, and multimedia into apps. MicroStrategy's social intelligence platform includes a number of applications that help enterprises harness the power of social networks for marketing and e-commerce, as well as a suite of free "friendly" consumer apps that use MicroStrategy's enterprise technologies. MicroStrategy's social intelligence platform helps companies leverage the value of social networks to better understand and engage their customers and fans. The MicroStrategy Cloud offering combines MicroStrategy and third-party software, hardware, and services to enable rapid, cost-effective development of hosted BI, mobile, and social applications. To learn more about MicroStrategy (Nasdaq: MSTR), visit http://www.microstrategy.com and follow us on Facebook (http://www.facebook.com/microstrategy) and Twitter (http://www.twitter.com/microstrategy).
MicroStrategy, MicroStrategy Business Intelligence Platform, MicroStrategy Cloud, MicroStrategy Mobile, Cloud Personal, MicroStrategy Transaction Services, Wisdom, MicroStrategy Wisdom and Emma are either trademarks or registered trademarks of MicroStrategy Incorporated in the United States and certain other countries. Other product and company names mentioned herein may be the trademarks of their respective owners.
This press release may include statements that may constitute "forward-looking statements," including estimates of future business prospects or financial results and statements containing the words "believe," "estimate," "project," "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the "Company") to differ materially from the forward-looking statements. Factors that could contribute to such differences include: the extent and timing of market acceptance of MicroStrategy's new offerings, including MicroStrategy 9.2.1, MicroStrategy Cloud, Gateway for Facebook, Alert, Cloud Personal, Wisdom for Facebook, MicroStrategy Wisdom, and Emma; the Company's ability to recognize revenue or deferred revenue through delivery of products or satisfactory performance of services; continued acceptance of the Company's other products in the marketplace; the timing of significant orders; delays in the Company's ability to develop or ship new products; competitive factors; general economic conditions, including significant downturns in industries, including the financial services and retail industries, in which we have a significant number of customers; currency fluctuations; impairment charges that may be required with respect to the Company's damaged corporate aircraft; and other risks detailed in the Company's registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
MSTR-F
Contact:MicroStrategy IncorporatedInvestor Relationsir@microstrategy.com(703) 848-8600
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2011 2010 2011 2010
---- ---- ---- ----
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Product licenses $39,262 $32,180 $100,072 $79,064
Product support and other services 102,442 82,350 301,812 236,393
Total revenues 141,704 114,530 401,884 315,457
------- ------- ------- -------
Cost of Revenues
Product licenses 2,284 1,966 6,514 5,741
Product support and other services 34,380 25,274 97,854 67,472
Total cost of revenues 36,664 27,240 104,368 73,213
------ ------ ------- ------
Gross profit 105,040 87,290 297,516 242,244
------- ------ ------- -------
Operating Expenses
Sales and marketing 61,451 42,002 173,904 114,750
Research and development 20,434 13,675 50,306 36,818
General and administrative 21,618 21,816 67,218 58,950
Total operating expenses 103,503 77,493 291,428 210,518
------- ------ ------- -------
Income from operations before
financing and other income and income taxes 1,537 9,797 6,088 31,726
----- ----- ----- ------
Financing and Other Income (Expense)
Interest income, net 18 192 139 309
Gain on sale of investment 3,371 - 3,371 -
Other income (expense), net 969 (1,817) 22 3,176
Total financing and other income (expense) 4,358 (1,625) 3,532 3,485
----- ------ ----- -----
Income from operations before income taxes 5,895 8,172 9,620 35,211
Provision for income taxes 974 821 680 9,341
--- --- --- -----
Net income $4,921 $7,351 $8,940 $25,870
====== ====== ====== =======
Basic earnings per share (1) $0.46 $0.66 $0.84 $2.24
===== ===== ===== =====
Weighted average shares outstanding used in
computing basic earnings per share 10,729 11,206 10,703 11,572
====== ====== ====== ======
Diluted earnings per share (1) $0.44 $0.63 $0.81 $2.16
===== ===== ===== =====
Weighted average shares outstanding used in
computing diluted earnings per share 11,072 11,603 11,061 11,976
====== ====== ====== ======
(1) Basic and fully diluted earnings per share for class A and class B common stock
are the same.
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI Business Angel.com Consolidated
---------------- --------- ------------
Three Months Three Months Three Months
Ended Ended Ended
September 30, September 30, September 30,
------------- ------------- -------------
2011 2010 2011 2010 2011 2010
---- ---- ---- ---- ---- ----
Revenues
Product licenses $39,262 $32,180 $- $- $39,262 $32,180
Product support and other services 96,561 77,753 - - 96,561 77,753
Angel.com services - - 5,881 4,597 5,881 4,597
Total revenues 135,823 109,933 5,881 4,597 141,704 114,530
------- ------- ----- ----- ------- -------
Cost of Revenues
Product licenses 2,284 1,966 - - 2,284 1,966
Product support and other services 31,478 23,162 - - 31,478 23,162
Angel.com services - - 2,902 2,112 2,902 2,112
Total cost of revenues 33,762 25,128 2,902 2,112 36,664 27,240
------ ------ ----- ----- ------ ------
Gross profit 102,061 84,805 2,979 2,485 105,040 87,290
------- ------ ----- ----- ------- ------
Operating Expenses
Sales and marketing 58,494 39,979 2,957 2,023 61,451 42,002
Research and development 19,144 12,773 1,290 902 20,434 13,675
General and administrative 20,793 21,223 825 593 21,618 21,816
Total operating expenses 98,431 73,975 5,072 3,518 103,503 77,493
------ ------ ----- ----- ------- ------
Income (loss) from operations before
financing and other income and income
taxes 3,630 10,830 (2,093) (1,033) 1,537 9,797
----- ------ ------ ------ ----- -----
Financing and Other Income (Expense)
Interest income, net 18 192 - - 18 192
Gain on sale of investment 3,371 - - - 3,371 -
Other income (expense), net 925 (1,785) 44 (32) 969 (1,817)
Total financing and other income
(expense) 4,314 (1,593) 44 (32) 4,358 (1,625)
----- ------ --- --- ----- ------
Income (loss) from operations before
income taxes $7,944 $9,237 $(2,049) $(1,065) $5,895 $8,172
Provision for income taxes 974 821
--- ---
Net income $4,921 $7,351
====== ======
Basic earnings per share $0.46 $0.66
===== =====
Weighted average shares outstanding
used in computing basic earnings per
share 10,729 11,206
====== ======
Diluted earnings per share $0.44 $0.63
===== =====
Weighted average shares outstanding
used in computing diluted earnings
per share 11,072 11,603
====== ======
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI Business Angel.com Consolidated
---------------- --------- ------------
Nine Months Nine Months
Ended Ended Nine Months Ended
September 30, September 30, September 30,
------------- ------------- -------------
2011 2010 2011 2010 2011 2010
---- ---- ---- ---- ---- ----
Revenues
Product licenses $100,072 $79,064 $- $- $100,072 $79,064
Product support and other services 283,127 223,618 - - 283,127 223,618
Angel.com services - - 18,685 12,775 18,685 12,775
Total revenues 383,199 302,682 18,685 12,775 401,884 315,457
------- ------- ------ ------ ------- -------
Cost of Revenues
Product licenses 6,514 5,741 - - 6,514 5,741
Product support and other services 89,385 61,716 - - 89,385 61,716
Angel.com services - - 8,469 5,756 8,469 5,756
Total cost of revenues 95,899 67,457 8,469 5,756 104,368 73,213
------ ------ ----- ----- ------- ------
Gross profit 287,300 235,225 10,216 7,019 297,516 242,244
------- ------- ------ ----- ------- -------
Operating Expenses
Sales and marketing 164,876 109,642 9,028 5,108 173,904 114,750
Research and development 46,917 34,416 3,389 2,402 50,306 36,818
General and administrative 64,949 57,415 2,269 1,535 67,218 58,950
Total operating expenses 276,742 201,473 14,686 9,045 291,428 210,518
------- ------- ------ ----- ------- -------
Income (loss) from operations before
financing and other income and income
taxes 10,558 33,752 (4,470) (2,026) 6,088 31,726
------ ------ ------ ------ ----- ------
Financing and Other Income (Expense)
Interest income, net 139 309 - - 139 309
Gain on sale of investment 3,371 - - - 3,371 -
Other income (expense), net 55 3,186 (33) (10) 22 3,176
Total financing and other income
(expense) 3,565 3,495 (33) (10) 3,532 3,485
----- ----- --- --- ----- -----
Income (loss) from operations before
income taxes $14,123 $37,247 $(4,503) $(2,036) $9,620 $35,211
Provision for income taxes 680 9,341
--- -----
Net income $8,940 $25,870
====== =======
Basic earnings per share $0.84 $2.24
===== =====
Weighted average shares outstanding
used in computing basic earnings per
share 10,703 11,572
====== ======
Diluted earnings per share $0.81 $2.16
===== =====
Weighted average shares outstanding
used in computing diluted earnings
per share 11,061 11,976
====== ======
MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
September December
30, 31,
2011 2010
---- ----
Assets (unaudited) (audited)
Current assets
Cash and cash equivalents $186,300 $174,097
Restricted cash and short-term
investments 413 284
Accounts receivable, net 77,084 82,056
Prepaid expenses and other current
assets 19,956 26,751
Deferred tax assets, net 26,640 13,670
------ ------
Total current assets 310,393 296,858
Property and equipment, net 87,497 65,033
Capitalized software development costs,
net 9,188 9,059
Deposits and other assets 5,807 5,587
Deferred tax assets, net 2,309 5,029
----- -----
Total Assets $415,194 $381,566
======== ========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses $40,754 $36,683
Accrued compensation and employee
benefits 54,875 60,201
Deferred revenue and advance payments 97,452 89,331
Deferred tax liabilities 371 355
--- ---
Total current liabilities 193,452 186,570
Deferred revenue and advance payments 11,039 7,878
Other long-term liabilities 42,992 37,946
Deferred tax liabilities 3,733 -
----- ---
Total Liabilities 251,216 232,394
------- -------
Stockholders' Equity
Preferred stock undesignated, $0.001
par value; 5,000 shares authorized;
no shares issued or outstanding - -
Class A common stock, $0.001 par value;
330,000 shares authorized;
14,673 shares issued and 8,268 shares
outstanding, and 14,351 shares
issued and 7,947 shares outstanding,
respectively 15 14
Class B common stock, $0.001 par value;
165,000 shares authorized;
2,493 and 2,694 shares issued and
outstanding, respectively 2 3
Additional paid-in capital 461,469 455,374
Treasury stock, at cost; 6,405 shares (475,184) (475,184)
Accumulated other comprehensive loss (1,684) (1,455)
Retained earnings 179,360 170,420
Total Stockholders' Equity 163,978 149,172
------- -------
Total Liabilities and Stockholders'
Equity $415,194 $381,566
======== ========
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Nine Months Ended
September 30,
-------------
2011 2010
---- ----
Operating activities:
Net income $8,940 $25,870
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 12,905 9,313
Bad debt expense 941 2,429
Deferred taxes (2,734) (509)
Excess tax benefits from share-
based compensation arrangements (3,791) (115)
Gain on sale of investment (3,371) -
Other, net - 26
Changes in operating assets and
liabilities:
Accounts receivable 4,389 (4,180)
Prepaid expenses and other current
assets 4,960 (2,615)
Deposits and other assets (316) (707)
Accounts payable and accrued
expenses (762) 1,462
Accrued compensation and employee
benefits (5,261) 1,243
Deferred revenue and advance
payments 11,411 12,922
Other long-term liabilities 5,065 10,799
----- ------
Net cash provided by operating activities 32,376 55,938
Investing activities:
Proceeds from sale of investment 3,371 -
Purchases of property and equipment (29,128) (11,817)
Capitalized software development
costs (5,907) (2,185)
Insurance proceeds 5,675 -
(Increase) decrease in restricted
cash and investments (161) 248
---- ---
Net cash used in investing activities (26,150) (13,754)
Financing activities:
Proceeds from sale of class A
common stock under exercise of
employee stock options 2,207 240
Excess tax benefits from share-
based compensation arrangements 3,791 115
Purchases of treasury stock - (81,618)
--- -------
Net cash provided by (used in) financing activities 5,998 (81,263)
Effect of foreign exchange rate
changes on cash and cash
equivalents (21) (1,388)
--- ------
Net increase (decrease) in cash and
cash equivalents 12,203 (40,467)
Cash and cash equivalents,
beginning of period 174,097 224,769
------- -------
Cash and cash equivalents, end of
period $186,300 $184,302
======== ========
SOURCE MicroStrategy Incorporated
MicroStrategy Incorporated
Web Site: http://www.microstrategy.com
MicroStrategy Announces Third Quarter 2011 Financial Results
Record $141.7 Million in Total Revenues
TYSONS CORNER, Va., Oct. 31, 2011 /PRNewswire/ -- MicroStrategy® Incorporated (Nasdaq: MSTR), a leading worldwide provider of business intelligence software, today announced financial results for the three-month period ended September 30, 2011 (the third quarter of its 2011 fiscal year).
Third quarter 2011 revenues were $141.7 million, the highest quarterly total revenues in Company history, versus $114.5 million for the third quarter of 2010, a 24% increase. Product licenses revenues for the third quarter of 2011 were $39.3 million versus $32.2 million for the third quarter of 2010, a 22% increase. Product support and other services revenues for MicroStrategy's core business intelligence (BI) business in the third quarter of 2011 were $96.6 million versus $77.8 million for the third quarter of 2010, a 24% increase.
Operating expenses for the third quarter of 2011 were $103.5 million versus $77.5 million for the third quarter of 2010, a 34% increase. The increase in operating expenses was primarily due to increased headcount and related expenses, particularly for engineering and sales personnel.
Net income for the third quarter of 2011 was $4.9 million, or $0.44 per share on a diluted basis, compared to $7.4 million, or $0.63 per share on a diluted basis, for the third quarter of 2010. Third quarter 2011 net income included a $3.4 million pre-tax gain on the sale of an equity investment.
For the third quarter of 2011, MicroStrategy's effective tax rate was 17% compared to 10% for the third quarter of 2010. The higher effective tax rate in the third quarter of 2011 was primarily attributable to certain discrete adjustments that were recorded in the third quarter of 2010, partially offset by stronger results outside the U.S. in the third quarter of 2011 compared to the same period in 2010.
As of September 30, 2011, MicroStrategy had cash and cash equivalents of $186.3 million versus $174.1 million as of December 31, 2010, an increase of $12.2 million. As of September 30, 2011, MicroStrategy had 8,268,079 shares of class A common stock and 2,492,830 shares of class B common stock outstanding.
MicroStrategy Expands Launch of New Mobile, Cloud and Social Media Technologies:
In September 2011, MicroStrategy unveiled several new technologies.
-- MicroStrategy announced the release of Cloud Personal(TM), a free
cloud-based business intelligence service. Cloud Personal combines the
Company's latest technology innovations - MicroStrategy Cloud(TM),
MicroStrategy Visual Insight(TM), and MicroStrategy Mobile(TM) -
enabling users to easily upload data to the MicroStrategy Cloud, analyze
it via rich visualizations, and share powerful insights with colleagues
or friends as a mobile application or web browser dashboard.
-- MicroStrategy introduced Wisdom(TM) for Facebook, a free application
that is now available worldwide for both the iPhone® and iPad® on the
Apple® iTunes® App Store, as well as in a web-based Facebook app
format. Wisdom organizes your Facebook content and provides insights
into your network of Facebook friends, so you do not have to contend
with information overload and can easily learn from the collective
experience of your friends.
-- MicroStrategy also introduced MicroStrategy Wisdom(TM), a cloud-based
application that injects social intelligence into the Facebook
applications of corporations.
-- MicroStrategy additionally announced Emma(TM), a new marketplace for
Facebook users. Emma enhances the concept of free classifieds by
attaching Facebook credentials to classified listings. Because everyone
in the Emma community has a Facebook profile, they can trade with more
confidence, whether they are buying or selling products and services or
engaging in social transactions such as finding a roommate or rideshare.
The launch of these new offerings followed the release in July 2011 of several other innovative MicroStrategy technologies designed to enable companies to capitalize on the big data, mobile, cloud, and social media trends that are transforming the way commerce is conducted.
-- The Company announced the general availability of MicroStrategy 9.2.1.
This latest release of the MicroStrategy Business Intelligence
Platform(TM) features a new product, MicroStrategy Transaction
Services(TM), which allows users to initiate actions and transactions
from a mobile device. MicroStrategy Transaction Services helps
companies increase the speed and productivity of their businesses by
building mobile apps that connect to back-end transactional systems and
databases.
-- MicroStrategy also announced the general availability of MicroStrategy
Cloud(TM), a cloud-based platform-as-a-service. MicroStrategy Cloud
enables rapid, cost-effective development of business intelligence and
mobile and social apps. Compared to traditional on-premises BI
approaches, MicroStrategy Cloud is faster to deploy, delivers
world-class performance, and offers significant financial advantages.
-- The Company introduced Gateway for Facebook, a new cloud-based service
that can interconnect enterprise IT environments and enterprise
applications with the Facebook social graph. Gateway for Facebook
converts the Facebook social graph data structure into a tabular data
structure, making it easier for enterprise applications like CRM,
marketing, service, sales, loyalty, and mobile applications to be
personalized using data from Facebook.
-- In connection with the Gateway for Facebook launch, MicroStrategy also
introduced Alert, a mobile Facebook application that gives Facebook
users a new way to follow all of their favorite celebrity and brand
Facebook pages. Alert presents users with a consolidated view of the
news, events, photos, and videos from their favorite pages, while
allowing users to organize those pages into customized groups.
New Customers and New Deals with Existing Customers in Q3 2011 Included:
Activision; Aeropostale; AIG Global Asset Management Holdings Corp.; Banco Espirito Santo; Bank Of America; Belgacom Group; CareSource Management Group Co.; Comcast Entertainment Group; CSC Holdings; Dana Farber Cancer Institute; Dell Computer Corporation; Deutsche Bank Securities; Diageo North America; Electronic Arts; Endo Pharmaceuticals; ESPN; Google; Grange Insurance; Groupon.com; Hannover Ruckversicherung AG; Kassenarztliche Bundesvereinigung; Kohl's Department Stores; MacIntosh Retail Group NV; McDonald's Corporation; MedStar Health; Mercer (US) Inc.; Metropolitan Life Insurance Co.; Navteq; Nedbank Ltd; Netflix; Olympus Corporation; Pacific Sunwear; PF Chang's China Bistro; Polo Ralph Lauren Corporation; Radio Shack Corporation; Rogers Communications Partnership; Salesforce.com; Securitas Direct AB; Shionogi & Co., Ltd.; Social Security Administration; Speedway SuperAmerica LLC; Standard & Poor's Corporation; Staples, Inc.; Starwood Hotels & Resorts Worldwide, Inc.; TARP Worldwide; and US Capitol Police.
Examples of Customer Deals from Q3 2011:
Pacific Sunwear
Pacific Sunwear, with headquarters in Anaheim, California, is a leading specialty retailer with more than 800 stores in 50 states and Puerto Rico. Pacific Sunwear employees, including executives, merchants and planners, rely on MicroStrategy dashboards to analyze key merchandise sales and inventory metrics, and make real-time business decisions. A recent expansion of MicroStrategy licenses will allow Pacific Sunwear to upgrade to 64-bit functionality to improve performance, scalability, and capacity to support their growing BI environment. Ad-hoc capabilities will also enable end-users to perform drill-down analyses, eliminating the reliance on IT to support the end-user community with reporting needs. Pacific Sunwear selected MicroStrategy for its ease-of-use, superior visualizations and analytical reporting capabilities, as well as its outstanding scalability for big data.
CareSource Management Group Co.
CareSource, based in Dayton, Ohio, is a major not-for-profit, public-sector managed healthcare company that offers services to roughly 870,000 members in Ohio and Michigan. A new MicroStrategy customer, CareSource has chosen the MicroStrategy platform to measure service quality within its provider network. CareSource plans to develop a reporting iPhone app built on the MicroStrategy Mobile platform that will allow employees to remotely access key Healthcare Effectiveness Data and Information Set (HEDIS) quality measures in a visual, intuitive way. The mobile app will leverage HEDIS measures, which are used by more than 90 percent of America's health plans to measure performance on important dimensions of care and service. MicroStrategy was chosen following an extensive analysis of competitive business intelligence products.
About MicroStrategy Incorporated
Founded in 1989, MicroStrategy is a leading provider of enterprise software platforms for business intelligence (BI), mobile intelligence, and social intelligence applications. MicroStrategy's BI platform enables leading organizations worldwide to analyze the vast amounts of data stored across their enterprises to make better business decisions. Companies choose MicroStrategy BI for its ease-of-use, sophisticated analytics, and superior data and user scalability. The MicroStrategy BI platform delivers actionable information to business users via the web and mobile devices. MicroStrategy's mobile intelligence platform helps companies and organizations build, deploy, and maintain mobile apps across a range of solutions by embedding intelligence, transactions, and multimedia into apps. MicroStrategy's social intelligence platform includes a number of applications that help enterprises harness the power of social networks for marketing and e-commerce, as well as a suite of free "friendly" consumer apps that use MicroStrategy's enterprise technologies. MicroStrategy's social intelligence platform helps companies leverage the value of social networks to better understand and engage their customers and fans. The MicroStrategy Cloud offering combines MicroStrategy and third-party software, hardware, and services to enable rapid, cost-effective development of hosted BI, mobile, and social applications. To learn more about MicroStrategy (Nasdaq: MSTR), visit http://www.microstrategy.com and follow us on Facebook (http://www.facebook.com/microstrategy) and Twitter (http://www.twitter.com/microstrategy).
MicroStrategy, MicroStrategy Business Intelligence Platform, MicroStrategy Cloud, MicroStrategy Mobile, Cloud Personal, MicroStrategy Transaction Services, Wisdom, MicroStrategy Wisdom and Emma are either trademarks or registered trademarks of MicroStrategy Incorporated in the United States and certain other countries. Other product and company names mentioned herein may be the trademarks of their respective owners.
This press release may include statements that may constitute "forward-looking statements," including estimates of future business prospects or financial results and statements containing the words "believe," "estimate," "project," "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the "Company") to differ materially from the forward-looking statements. Factors that could contribute to such differences include: the extent and timing of market acceptance of MicroStrategy's new offerings, including MicroStrategy 9.2.1, MicroStrategy Cloud, Gateway for Facebook, Alert, Cloud Personal, Wisdom for Facebook, MicroStrategy Wisdom, and Emma; the Company's ability to recognize revenue or deferred revenue through delivery of products or satisfactory performance of services; continued acceptance of the Company's other products in the marketplace; the timing of significant orders; delays in the Company's ability to develop or ship new products; competitive factors; general economic conditions, including significant downturns in industries, including the financial services and retail industries, in which we have a significant number of customers; currency fluctuations; impairment charges that may be required with respect to the Company's damaged corporate aircraft; and other risks detailed in the Company's registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
MSTR-F
Contact:MicroStrategy IncorporatedInvestor Relationsir@microstrategy.com(703) 848-8600
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2011 2010 2011 2010
---- ---- ---- ----
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Product licenses $39,262 $32,180 $100,072 $79,064
Product support and other services 102,442 82,350 301,812 236,393
Total revenues 141,704 114,530 401,884 315,457
------- ------- ------- -------
Cost of Revenues
Product licenses 2,284 1,966 6,514 5,741
Product support and other services 34,380 25,274 97,854 67,472
Total cost of revenues 36,664 27,240 104,368 73,213
------ ------ ------- ------
Gross profit 105,040 87,290 297,516 242,244
------- ------ ------- -------
Operating Expenses
Sales and marketing 61,451 42,002 173,904 114,750
Research and development 20,434 13,675 50,306 36,818
General and administrative 21,618 21,816 67,218 58,950
Total operating expenses 103,503 77,493 291,428 210,518
------- ------ ------- -------
Income from operations before
financing and other income and income taxes 1,537 9,797 6,088 31,726
----- ----- ----- ------
Financing and Other Income (Expense)
Interest income, net 18 192 139 309
Gain on sale of investment 3,371 - 3,371 -
Other income (expense), net 969 (1,817) 22 3,176
Total financing and other income (expense) 4,358 (1,625) 3,532 3,485
----- ------ ----- -----
Income from operations before income taxes 5,895 8,172 9,620 35,211
Provision for income taxes 974 821 680 9,341
--- --- --- -----
Net income $4,921 $7,351 $8,940 $25,870
====== ====== ====== =======
Basic earnings per share (1) $0.46 $0.66 $0.84 $2.24
===== ===== ===== =====
Weighted average shares outstanding used in
computing basic earnings per share 10,729 11,206 10,703 11,572
====== ====== ====== ======
Diluted earnings per share (1) $0.44 $0.63 $0.81 $2.16
===== ===== ===== =====
Weighted average shares outstanding used in
computing diluted earnings per share 11,072 11,603 11,061 11,976
====== ====== ====== ======
(1) Basic and fully diluted earnings per share for class A and class B common stock
are the same.
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI Business Angel.com Consolidated
---------------- --------- ------------
Three Months Three Months Three Months
Ended Ended Ended
September 30, September 30, September 30,
------------- ------------- -------------
2011 2010 2011 2010 2011 2010
---- ---- ---- ---- ---- ----
Revenues
Product licenses $39,262 $32,180 $- $- $39,262 $32,180
Product support and other services 96,561 77,753 - - 96,561 77,753
Angel.com services - - 5,881 4,597 5,881 4,597
Total revenues 135,823 109,933 5,881 4,597 141,704 114,530
------- ------- ----- ----- ------- -------
Cost of Revenues
Product licenses 2,284 1,966 - - 2,284 1,966
Product support and other services 31,478 23,162 - - 31,478 23,162
Angel.com services - - 2,902 2,112 2,902 2,112
Total cost of revenues 33,762 25,128 2,902 2,112 36,664 27,240
------ ------ ----- ----- ------ ------
Gross profit 102,061 84,805 2,979 2,485 105,040 87,290
------- ------ ----- ----- ------- ------
Operating Expenses
Sales and marketing 58,494 39,979 2,957 2,023 61,451 42,002
Research and development 19,144 12,773 1,290 902 20,434 13,675
General and administrative 20,793 21,223 825 593 21,618 21,816
Total operating expenses 98,431 73,975 5,072 3,518 103,503 77,493
------ ------ ----- ----- ------- ------
Income (loss) from operations before
financing and other income and income
taxes 3,630 10,830 (2,093) (1,033) 1,537 9,797
----- ------ ------ ------ ----- -----
Financing and Other Income (Expense)
Interest income, net 18 192 - - 18 192
Gain on sale of investment 3,371 - - - 3,371 -
Other income (expense), net 925 (1,785) 44 (32) 969 (1,817)
Total financing and other income
(expense) 4,314 (1,593) 44 (32) 4,358 (1,625)
----- ------ --- --- ----- ------
Income (loss) from operations before
income taxes $7,944 $9,237 $(2,049) $(1,065) $5,895 $8,172
Provision for income taxes 974 821
--- ---
Net income $4,921 $7,351
====== ======
Basic earnings per share $0.46 $0.66
===== =====
Weighted average shares outstanding
used in computing basic earnings per
share 10,729 11,206
====== ======
Diluted earnings per share $0.44 $0.63
===== =====
Weighted average shares outstanding
used in computing diluted earnings
per share 11,072 11,603
====== ======
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI Business Angel.com Consolidated
---------------- --------- ------------
Nine Months Nine Months
Ended Ended Nine Months Ended
September 30, September 30, September 30,
------------- ------------- -------------
2011 2010 2011 2010 2011 2010
---- ---- ---- ---- ---- ----
Revenues
Product licenses $100,072 $79,064 $- $- $100,072 $79,064
Product support and other services 283,127 223,618 - - 283,127 223,618
Angel.com services - - 18,685 12,775 18,685 12,775
Total revenues 383,199 302,682 18,685 12,775 401,884 315,457
------- ------- ------ ------ ------- -------
Cost of Revenues
Product licenses 6,514 5,741 - - 6,514 5,741
Product support and other services 89,385 61,716 - - 89,385 61,716
Angel.com services - - 8,469 5,756 8,469 5,756
Total cost of revenues 95,899 67,457 8,469 5,756 104,368 73,213
------ ------ ----- ----- ------- ------
Gross profit 287,300 235,225 10,216 7,019 297,516 242,244
------- ------- ------ ----- ------- -------
Operating Expenses
Sales and marketing 164,876 109,642 9,028 5,108 173,904 114,750
Research and development 46,917 34,416 3,389 2,402 50,306 36,818
General and administrative 64,949 57,415 2,269 1,535 67,218 58,950
Total operating expenses 276,742 201,473 14,686 9,045 291,428 210,518
------- ------- ------ ----- ------- -------
Income (loss) from operations before
financing and other income and income
taxes 10,558 33,752 (4,470) (2,026) 6,088 31,726
------ ------ ------ ------ ----- ------
Financing and Other Income (Expense)
Interest income, net 139 309 - - 139 309
Gain on sale of investment 3,371 - - - 3,371 -
Other income (expense), net 55 3,186 (33) (10) 22 3,176
Total financing and other income
(expense) 3,565 3,495 (33) (10) 3,532 3,485
----- ----- --- --- ----- -----
Income (loss) from operations before
income taxes $14,123 $37,247 $(4,503) $(2,036) $9,620 $35,211
Provision for income taxes 680 9,341
--- -----
Net income $8,940 $25,870
====== =======
Basic earnings per share $0.84 $2.24
===== =====
Weighted average shares outstanding
used in computing basic earnings per
share 10,703 11,572
====== ======
Diluted earnings per share $0.81 $2.16
===== =====
Weighted average shares outstanding
used in computing diluted earnings
per share 11,061 11,976
====== ======
MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
September December
30, 31,
2011 2010
---- ----
Assets (unaudited) (audited)
Current assets
Cash and cash equivalents $186,300 $174,097
Restricted cash and short-term
investments 413 284
Accounts receivable, net 77,084 82,056
Prepaid expenses and other current
assets 19,956 26,751
Deferred tax assets, net 26,640 13,670
------ ------
Total current assets 310,393 296,858
Property and equipment, net 87,497 65,033
Capitalized software development costs,
net 9,188 9,059
Deposits and other assets 5,807 5,587
Deferred tax assets, net 2,309 5,029
----- -----
Total Assets $415,194 $381,566
======== ========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses $40,754 $36,683
Accrued compensation and employee
benefits 54,875 60,201
Deferred revenue and advance payments 97,452 89,331
Deferred tax liabilities 371 355
--- ---
Total current liabilities 193,452 186,570
Deferred revenue and advance payments 11,039 7,878
Other long-term liabilities 42,992 37,946
Deferred tax liabilities 3,733 -
----- ---
Total Liabilities 251,216 232,394
------- -------
Stockholders' Equity
Preferred stock undesignated, $0.001
par value; 5,000 shares authorized;
no shares issued or outstanding - -
Class A common stock, $0.001 par value;
330,000 shares authorized;
14,673 shares issued and 8,268 shares
outstanding, and 14,351 shares
issued and 7,947 shares outstanding,
respectively 15 14
Class B common stock, $0.001 par value;
165,000 shares authorized;
2,493 and 2,694 shares issued and
outstanding, respectively 2 3
Additional paid-in capital 461,469 455,374
Treasury stock, at cost; 6,405 shares (475,184) (475,184)
Accumulated other comprehensive loss (1,684) (1,455)
Retained earnings 179,360 170,420
Total Stockholders' Equity 163,978 149,172
------- -------
Total Liabilities and Stockholders'
Equity $415,194 $381,566
======== ========
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Nine Months Ended
September 30,
-------------
2011 2010
---- ----
Operating activities:
Net income $8,940 $25,870
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 12,905 9,313
Bad debt expense 941 2,429
Deferred taxes (2,734) (509)
Excess tax benefits from share-
based compensation arrangements (3,791) (115)
Gain on sale of investment (3,371) -
Other, net - 26
Changes in operating assets and
liabilities:
Accounts receivable 4,389 (4,180)
Prepaid expenses and other current
assets 4,960 (2,615)
Deposits and other assets (316) (707)
Accounts payable and accrued
expenses (762) 1,462
Accrued compensation and employee
benefits (5,261) 1,243
Deferred revenue and advance
payments 11,411 12,922
Other long-term liabilities 5,065 10,799
----- ------
Net cash provided by operating activities 32,376 55,938
Investing activities:
Proceeds from sale of investment 3,371 -
Purchases of property and equipment (29,128) (11,817)
Capitalized software development
costs (5,907) (2,185)
Insurance proceeds 5,675 -
(Increase) decrease in restricted
cash and investments (161) 248
---- ---
Net cash used in investing activities (26,150) (13,754)
Financing activities:
Proceeds from sale of class A
common stock under exercise of
employee stock options 2,207 240
Excess tax benefits from share-
based compensation arrangements 3,791 115
Purchases of treasury stock - (81,618)
--- -------
Net cash provided by (used in) financing activities 5,998 (81,263)
Effect of foreign exchange rate
changes on cash and cash
equivalents (21) (1,388)
--- ------
Net increase (decrease) in cash and
cash equivalents 12,203 (40,467)
Cash and cash equivalents,
beginning of period 174,097 224,769
------- -------
Cash and cash equivalents, end of
period $186,300 $184,302
======== ========
SOURCE MicroStrategy Incorporated
MicroStrategy Incorporated
Web Site: http://www.microstrategy.com