eGain reports 37% growth in SaaS revenue for fiscal 2019; exceeds full year revenue guidance
Sunnyvale, CA (September 3, 2019) – eGain (NASDAQ: EGAN), a leading provider of customer engagement hubs, today announced financial results for its fiscal 2019 fourth quarter and full year ended June 30, 2019.
Ashu Roy, eGain CEO, commented, “We had a solid fiscal 2019 with revenue ahead of guidance and strong cash flow. Demand for AI-powered digital automation continues to strengthen and we are stepping up growth investment, especially in the partner ecosystem. The new fiscal year is off to a good start, with strong bookings early in the first quarter.”
Fiscal 2019 Full Year Financial Highlights
- SaaS revenue was $44.8 million, up 37% year over year (39% in constant currency).
- Subscription revenue, which includes SaaS and legacy revenue, was $60.0 million, up 17% year over year (19% in constant currency) and comprised 89% of total revenue.
- Total revenue was $67.2 million, up 10% year over year (12% in constant currency).
- GAAP net income was $4.2 million, or $0.15 per share on a basic and $0.14 on a diluted basis, compared to a GAAP net loss of $2.0 million, or $(0.07) per share on a basic and diluted basis, for fiscal 2018.
- Non-GAAP net income was $6.2 million, or $0.22 per share on a basic basis and $0.21 on a diluted basis, compared to non-GAAP net income of $1.7 million, or $0.06 per share on a basic and diluted basis, for fiscal 2018.
- Cash provided by operations was $7.0 million, up from cash provided by operations of $6.6 million in fiscal 2018.
- Total cash and cash equivalents, as of June 30, 2019, was $31.9 million, compared to $11.5 million as of June 30, 2018.
Fiscal 2019 Fourth Quarter Financial Highlights
- SaaS revenue was $11.6 million, up 24% year over year (26% in constant currency).
- Subscription revenue, which includes SaaS and legacy revenue, was $15.1 million, up 12% year over year (14% in constant currency) and comprised 90% of total revenue.
- Total revenue was $16.8 million, up 8% year over year.
- GAAP net income was $166,000, or $0.01 per share on a basic and diluted basis, compared to a GAAP net loss of $536,000, or $(0.02) per share on a basic and diluted basis, for Q4 2018.
- Non-GAAP net income was $659,000, or $0.02 per share on a basic and diluted basis, compared to non-GAAP net income of $300,000, or $0.01 per share on a basic and diluted basis, for Q4 2018.
Fiscal 2020 Financial Guidance
For the fiscal year ending June 30, 2020, eGain expects full year SaaS revenue of $53.8 million to $55.4 million (on a constant currency basis), which would represent growth between 20% and 24% year over year, total revenue of $72.0 million to $73.6 million (on a constant currency basis), which would represent growth between 7% and 10% year over year and to generate non-GAAP net income of breakeven to $2.0 million, or $0.00 to $0.06 per diluted share.
For the first quarter of fiscal 2020, eGain expects SaaS revenue of $11.8 million to $12.1 million (on a constant currency basis), which would represent growth between 23% and 26% year over year, total revenue of $16.8 million to $17.2 million (on a constant currency basis), which would represent growth between 7% and 10% year over year and to generate non-GAAP net income of $0.5 million to $1.0 million, or $0.02 to $0.03 per diluted share.
Non-GAAP Financial Measures
This press release includes non-GAAP operating income/(loss) and non-GAAP net income/(loss) as supplemental information relating to our operating results. Non-GAAP net income/(loss) is defined as net income/(loss) adjusted for stock-based compensation expense and amortization of acquired intangible assets. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from non-GAAP measures used by other companies. eGain’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. Defined in the supplemental information is SaaS and legacy revenue, where legacy revenue is defined as legacy license and associated legacy support revenue that we no longer sell. eGain believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release. eGain urges investors to review the reconciliation and not to rely on any single financial measure to evaluate the Company’s business.
Conference Call Information
eGain will discuss its fiscal 2019 fourth quarter and full year results today via teleconference at 2:00 p.m. Pacific Daylight Time. To access the live call, dial 888-254-3590 (US and Canada) or +1 323-994-2093 (international) and give the participant passcode 9906755. A live and archived webcast of the call will be accessible on the “Investors” section of the Company’s website at www.egain.com. In addition, a phone replay will be available approximately two hours following the end of the call and will remain available for one week. To access the call replay dial-in information, please click here.
eGain customer engagement solutions deliver digital transformation for leading brands – powered by virtual assistance, AI, knowledge, and analytics. Our comprehensive suite of applications help clients deliver memorable, digital-first customer experiences in an omnichannel world. To find out more about eGain, visit https://www.egain.com.
Cautionary Note Regarding Forward-Looking Statements.
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations and include our beliefs regarding demand for our products, including, without limitation: our belief that we see positive business and customer momentum; our belief that our pipeline and the demand for our AI-powered customer engagement platform offering is strong; expected increase in growth investment, including the partner ecosystem; and our beliefs with respect to SaaS revenue growth and net income growth for the fiscal year ending June 30, 2020 and the first quarter of fiscal 2020. The achievement or success of the matters covered by such forward-looking statements, including future financial guidance, involves risks, uncertainties and assumptions, many of which involve factors or circumstances that are beyond our control. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the Company’s actual results could differ materially from the results expressed or implied by the forward-looking statements we make, including our ability to achieve our targets for the fiscal year ending June 30, 2020 and first quarter of fiscal 2020. The risks and uncertainties referred to above include, but are not limited to: risks associated with new product releases; risks that customer demand may fluctuate or decrease; risks that we are unable to collect unbilled contractual commitments; risks that our SaaS based revenue model and lengthy sales cycles may negatively affect our operating results; currency risks; our ability to capitalize on customer engagement; the success of organization changes; risks related to our reliance on a relatively small number of customers for a substantial portion of our revenue; our ability to compete successfully and manage growth; our ability to develop and expand strategic and third party distribution channels; risks related to our international operations; our ability to invest resources to improve our products and continue to innovate; weakened global economic conditions which may adversely affect our industry, general political or destabilizing events, including war, conflict or acts of terrorism, and other risks detailed from time to time in eGain’s public filings, including eGain’s annual report on Form 10-K filed on September 13, 2018 and subsequent reports filed with the Securities and Exchange Commission, which are available on the Securities and Exchange Commission’s Web site at www.sec.gov. These forward-looking statements are based on current expectations and speak only as of the date hereof. The Company assumes no obligation to update these forward-looking statements.
eGain, the eGain logo, and all other eGain product names and slogans are trademarks or registered trademarks of eGain Corp. in the United States and/or other countries. All other company names and products mentioned in this release may be trademarks or registered trademarks of the respective companies.
June 2019 quarter financial data
MKR Group Investor Relations
Todd Kehrli or Jim Byers