CyberArk Software’s (CYBR) CEO Udi Mokady On Q4 2016 Results – Earnings Call Transcript

Call Start: 16:30

Call End: 17:32

CyberArk Software Ltd. (NASDAQ:CYBR)

Q4 2016 Earnings Conference Call

February 9, 2017 16:30 ET


Erica Smith – VP, IR

Udi Mokady – Chairman & CEO

Josh Siegel – CFO


Jonathan Ho – William Blair

Rob Owens – Pacific Crest Securities

Fatima Boolani – UBS

Taz Koujalgi – Deutsche Bank

Andrew Nowinski – Piper Jaffray

Catharine Trebnick – Dougherty

Erik Suppiger – JMP Securities

Ken Talanian – Evercore ISI


Good day, ladies and gentlemen, and welcome to the Q4 2016 CyberArk Software Limited Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder this call is being recorded.

I would now like to turn the conference over to Erica Smith, you may begin.

Erica Smith

Thank you, Michelle. Good afternoon everyone. Thank you for joining us today to review CyberArk’s fourth quarter and full year 2016 financial results.

With me today on the call are Udi Mokady, our Chairman and Chief Executive Officer; and Josh Siegel, Chief Financial Officer. After preliminary remarks, we will open the call up to a question-and-answer session.

Before we begin, let me remind you that certain statements made on the call today may be considered forward-looking statements which reflect management’s best judgment based on currently available information. I refer specifically to the discussion of our expectations and beliefs regarding our projected results of operations for the first quarter and full year 2017. Our actual results might differ materially from those projected in these forward-looking statements. I direct your attention to the risk factors contained in the company’s annual report on 20-F filed with the United States Securities and Exchange Commission and those referenced in today’s press release.

CyberArk expressly disclaims any application or undertaking to release publicly any updates or revisions to any forward-looking statements made here today. Additionally, non-GAAP financial measures will be discussed on this conference call. A reconciliation to the most directly comparable GAAP financial measures is also available in today’s press release, which can be found at in the Investor Relations section. Also, a webcast of today’s call will be available on our website in the Investor Relations section.

With that I’d like to turn the call over to our Chairman and Chief Executive Officer, Udi Mokady. Udi?

Udi Mokady

Thanks, Erica and good morning, everyone. Thank you for joining us to discuss our fourth quarter and year end results. In early 2016 we outlined our strategy to grow our top line and deliver strong operating margins, successfully integrate our acquisitions, and has our leadership position through innovation and expand the reach of our partner ecosystem. I’m pleased to announce that we executed successfully against all of these objectives.

Financially, we had a great fourth quarter capping off another tremendous year. Revenue for the quarter was a record $64.4 million and we generated 30% non-GAAP operating margins. For the year revenue reached a record $216.6 million growing 35% and we recorded $58 million in non-GAAP operating income, a 27% operating margin and $45.2 million in non-GAAP net income. We are thrilled with the outperformance which reflects the power of our operating model and the ongoing execution of our land and expand strategy. We closed over 200 new logos in the fourth quarter alone ending the year with more than 3,075 customers, an increase from about 2,500 last year.

With our customer additions, more than 25% of the Global 2000 and about half of the Fortune 100 are trusting CyberArk to help protect their most valuable assets. The vast majority of our new customer deals were again greenfield engagements illustrating that we have a long runway ahead of us. New business highlights in the fourth quarter include a large manufacturing company in EMEA choose CyberArk not only because of our flexible modular platform but also because we can support its ongoing strategy which includes AWS, Office 365 and DevOps processes. A mid-market SAP application vendor running an AWS will leverage three of our products to lock down coverage accounts while it monitors and control access into the cloud environment.