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| 8-K - 8-K FORESCOUT INC. - FORESCOUT TECHNOLOGIES, INC | pr606adoption03152018.htm |
Exhibit 99.1
FORESCOUT TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share amounts)
Year Ended December 31, | Restated For New Revenue Standard | Previously Reported | Change | ||||||||||||||||||||
2016 | 2017 | 2016 | 2017 | 2016 | 2017 | ||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Product | $ | 97,994 | $ | 125,348 | $ | 98,655 | $ | 121,413 | $ | (661 | ) | $ | 3,935 | ||||||||||
Maintenance and professional services | 69,552 | 99,056 | 68,186 | 99,458 | 1,366 | (402 | ) | ||||||||||||||||
Total revenue | 167,546 | 224,404 | 166,841 | 220,871 | 705 | 3,533 | |||||||||||||||||
Cost of revenue: | |||||||||||||||||||||||
Product | 21,832 | 23,841 | 21,678 | 24,098 | 154 | (257 | ) | ||||||||||||||||
Maintenance and professional services | 26,571 | 34,771 | 26,571 | 34,771 | — | — | |||||||||||||||||
Total cost of revenue | 48,403 | 58,612 | 48,249 | 58,869 | 154 | (257 | ) | ||||||||||||||||
Total gross profit | 119,143 | 165,792 | 118,592 | 162,002 | 551 | 3,790 | |||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 31,490 | 47,435 | 31,490 | 47,435 | — | — | |||||||||||||||||
Sales and marketing | 119,071 | 144,398 | 127,815 | 151,093 | (8,744 | ) | (6,695 | ) | |||||||||||||||
General and administrative | 30,731 | 51,206 | 30,731 | 51,206 | — | — | |||||||||||||||||
Total operating expenses | 181,292 | 243,039 | 190,036 | 249,734 | (8,744 | ) | (6,695 | ) | |||||||||||||||
Loss from operations | (62,149 | ) | (77,247 | ) | (71,444 | ) | (87,732 | ) | 9,295 | 10,485 | |||||||||||||
Interest expense | (2,577 | ) | (1,223 | ) | (2,577 | ) | (1,223 | ) | — | — | |||||||||||||
Other income (expense), net | (607 | ) | 316 | (607 | ) | 316 | — | — | |||||||||||||||
Revaluation of warrant liabilities | 1,104 | (727 | ) | 1,104 | (727 | ) | — | — | |||||||||||||||
Loss before income taxes | (64,229 | ) | (78,881 | ) | (73,524 | ) | (89,366 | ) | 9,295 | 10,485 | |||||||||||||
Income tax provision | 1,250 | 1,839 | 1,250 | 1,839 | — | — | |||||||||||||||||
Net loss | $ | (65,479 | ) | $ | (80,720 | ) | $ | (74,774 | ) | $ | (91,205 | ) | $ | 9,295 | $ | 10,485 | |||||||
Deemed dividend on the conversion of Series G redeemable convertible preferred stock | — | 12,810 | — | 12,810 | — | — | |||||||||||||||||
Net loss attributable to common stockholders | $ | (65,479 | ) | $ | (93,530 | ) | $ | (74,774 | ) | $ | (104,015 | ) | $ | 9,295 | $ | 10,485 | |||||||
Net loss per share attributable to common stockholders, basic and diluted | $ | (11.67 | ) | $ | (8.20 | ) | $ | (13.33 | ) | $ | (9.12 | ) | $ | 1.66 | $ | 0.92 | |||||||
Restated results reflect the adoption of the new revenue recognition standard. Previously reported results for fiscal year 2016 were derived from audited financial statements included in our prospectus filed pursuant to Rule 424(b)(4), as amended, on October 27, 2017. Results for fiscal year 2017 were derived from audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017.
FORESCOUT TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands)
As of December 31, | Restated For New Revenue Standard | Previously Reported | Change | ||||||||||||||||||||
2016 | 2017 | 2016 | 2017 | 2016 | 2017 | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||
Cash and cash equivalents | $ | 79,665 | $ | 63,009 | $ | 79,665 | $ | 63,009 | $ | — | $ | — | |||||||||||
Marketable securities | — | 123,384 | — | 123,384 | — | — | |||||||||||||||||
Accounts receivable | 44,694 | 64,686 | 44,694 | 65,428 | — | (742 | ) | ||||||||||||||||
Inventory | 890 | 3,660 | 890 | 3,660 | — | — | |||||||||||||||||
Deferred commission - current | 7,780 | 10,957 | — | — | 7,780 | 10,957 | |||||||||||||||||
Prepaid expenses and other current assets | 9,072 | 9,213 | 8,592 | 8,655 | 480 | 558 | |||||||||||||||||
Total current assets | 142,101 | 274,909 | 133,841 | 264,136 | 8,260 | 10,773 | |||||||||||||||||
Deferred commission - non-current | 17,503 | 21,795 | — | — | 17,503 | 21,795 | |||||||||||||||||
Property and equipment, net | 24,536 | 23,260 | 24,536 | 23,260 | — | — | |||||||||||||||||
Severance pay deposits | 1,704 | 2,118 | 1,704 | 2,118 | — | — | |||||||||||||||||
Restricted cash | 4,011 | 4,146 | 4,011 | 4,146 | — | — | |||||||||||||||||
Other assets | 4,417 | 2,490 | 3,334 | 2,002 | 1,083 | 488 | |||||||||||||||||
Total assets | $ | 194,272 | $ | 328,718 | $ | 167,426 | $ | 295,662 | $ | 26,846 | $ | 33,056 | |||||||||||
Liabilities, redeemable convertible preferred stock and stockholders' equity (deficit) | |||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||
Accounts payable | $ | 5,210 | $ | 7,348 | $ | 5,210 | $ | 7,348 | $ | — | $ | — | |||||||||||
Accrued compensation | 17,286 | 25,358 | 17,286 | 25,358 | — | — | |||||||||||||||||
Accrued expenses | 12,903 | 10,023 | 12,903 | 10,023 | — | — | |||||||||||||||||
Customer deposits | 718 | 1,008 | 718 | 1,008 | — | — | |||||||||||||||||
Deferred revenue | 52,879 | 79,631 | 68,844 | 98,027 | (15,965 | ) | (18,396 | ) | |||||||||||||||
Notes payable | 7,163 | 7,245 | 7,163 | 7,245 | — | — | |||||||||||||||||
Total current liabilities | 96,159 | 130,613 | 112,124 | 149,009 | (15,965 | ) | (18,396 | ) | |||||||||||||||
Warrant liabilities | 4,874 | — | 4,874 | — | — | — | |||||||||||||||||
Deferred revenue - non-current | 32,411 | 55,228 | 40,070 | 64,731 | (7,659 | ) | (9,503 | ) | |||||||||||||||
Notes payable - non-current | 22,824 | 15,579 | 22,824 | 15,579 | — | — | |||||||||||||||||
Accrued severance pay liability | 2,033 | 2,617 | 2,033 | 2,617 | — | — | |||||||||||||||||
Other liabilities | 10,244 | 9,190 | 10,244 | 9,190 | — | — | |||||||||||||||||
Total liabilities | 168,545 | 213,227 | 192,169 | 241,126 | (23,624 | ) | (27,899 | ) | |||||||||||||||
Commitments and contingencies | |||||||||||||||||||||||
Redeemable convertible preferred stock | 283,854 | — | 283,854 | — | — | — | |||||||||||||||||
Stockholders' equity (deficit): | |||||||||||||||||||||||
Common stock | 6 | 38 | 6 | 38 | — | — | |||||||||||||||||
Additional paid-in capital | 84,792 | 551,986 | 84,792 | 551,986 | — | — | |||||||||||||||||
Accumulated other comprehensive loss | — | (112 | ) | — | (112 | ) | — | — | |||||||||||||||
Accumulated deficit | (342,925 | ) | (436,421 | ) | (393,395 | ) | (497,376 | ) | 50,470 | 60,955 | |||||||||||||
Total stockholders’ (deficit) equity | (258,127 | ) | 115,491 | (308,597 | ) | 54,536 | 50,470 | 60,955 | |||||||||||||||
Total liabilities, redeemable convertible preferred stock and stockholders' (deficit) equity | $ | 194,272 | $ | 328,718 | $ | 167,426 | $ | 295,662 | $ | 26,846 | $ | 33,056 | |||||||||||
Restated results reflect the adoption of the new revenue recognition standard. Previously reported results for fiscal year 2016 were derived from audited financial statements included in our prospectus filed pursuant to Rule 424(b)(4), as amended, on October 27, 2017. Results for fiscal year 2017 were derived from audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017.
FORESCOUT TECHNOLOGIES, INC.
QUARTERLY FINANCIAL INFORMATION
(Unaudited, in thousands, except per share amounts)
Fiscal Year 2016 | Q1 2016 | Q2 2016 | Q3 2016 | Q4 2016 | ||||||||||||||||||||||||||||||||||||||||||||
As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | |||||||||||||||||||||||||||||||||||||
Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
Product | $ | 18,305 | $ | (2,131 | ) | $ | 16,174 | $ | 19,757 | $ | (686 | ) | $ | 19,071 | $ | 30,799 | $ | 2,767 | $ | 33,566 | $ | 29,794 | $ | (611 | ) | $ | 29,183 | |||||||||||||||||||||
Maintenance and professional services | 15,209 | 106 | 15,315 | 15,400 | 579 | 15,979 | 17,941 | 349 | 18,290 | 19,636 | 332 | 19,968 | ||||||||||||||||||||||||||||||||||||
Total revenue | 33,514 | (2,025 | ) | 31,489 | 35,157 | (107 | ) | 35,050 | 48,740 | 3,116 | 51,856 | 49,430 | (279 | ) | 49,151 | |||||||||||||||||||||||||||||||||
Cost of revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
Product | 3,076 | (10 | ) | 3,066 | 4,115 | 136 | 4,251 | 6,563 | (30 | ) | 6,533 | 7,924 | 58 | 7,982 | ||||||||||||||||||||||||||||||||||
Maintenance and professional services | 5,748 | — | 5,748 | 6,611 | — | 6,611 | 6,945 | — | 6,945 | 7,267 | — | 7,267 | ||||||||||||||||||||||||||||||||||||
Total cost of revenue | 8,824 | (10 | ) | 8,814 | 10,726 | 136 | 10,862 | 13,508 | (30 | ) | 13,478 | 15,191 | 58 | 15,249 | ||||||||||||||||||||||||||||||||||
Total gross profit | 24,690 | (2,015 | ) | 22,675 | 24,431 | (243 | ) | 24,188 | 35,232 | 3,146 | 38,378 | 34,239 | (337 | ) | 33,902 | |||||||||||||||||||||||||||||||||
Gross margin | 74 | % | (2 | )% | 72 | % | 69 | % | — | % | 69 | % | 72 | % | 2 | % | 74 | % | 69 | % | — | % | 69 | % | ||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||
Research and development | 6,478 | — | 6,478 | 7,365 | — | 7,365 | 8,509 | — | 8,509 | 9,138 | — | 9,138 | ||||||||||||||||||||||||||||||||||||
Sales and marketing | 29,377 | (544 | ) | 28,833 | 29,180 | (982 | ) | 28,198 | 35,759 | (4,982 | ) | 30,777 | 33,499 | (2,236 | ) | 31,263 | ||||||||||||||||||||||||||||||||
General and administrative | 7,028 | — | 7,028 | 8,086 | — | 8,086 | 7,967 | — | 7,967 | 7,650 | — | 7,650 | ||||||||||||||||||||||||||||||||||||
Total operating expenses | 42,883 | (544 | ) | 42,339 | 44,631 | (982 | ) | 43,649 | 52,235 | (4,982 | ) | 47,253 | 50,287 | (2,236 | ) | 48,051 | ||||||||||||||||||||||||||||||||
Loss from operations | (18,193 | ) | (1,471 | ) | (19,664 | ) | (20,200 | ) | 739 | (19,461 | ) | (17,003 | ) | 8,128 | (8,875 | ) | (16,048 | ) | 1,899 | (14,149 | ) | |||||||||||||||||||||||||||
Interest expense | (682 | ) | — | (682 | ) | (688 | ) | — | (688 | ) | (702 | ) | — | (702 | ) | (505 | ) | — | (505 | ) | ||||||||||||||||||||||||||||
Other income (expense), net | (37 | ) | — | (37 | ) | (91 | ) | — | (91 | ) | (226 | ) | — | (226 | ) | (253 | ) | — | (253 | ) | ||||||||||||||||||||||||||||
Revaluation of warrant liabilities | 1,040 | — | 1,040 | (437 | ) | — | (437 | ) | (224 | ) | — | (224 | ) | 725 | — | 725 | ||||||||||||||||||||||||||||||||
Loss before income taxes | (17,872 | ) | (1,471 | ) | (19,343 | ) | (21,416 | ) | 739 | (20,677 | ) | (18,155 | ) | 8,128 | (10,027 | ) | (16,081 | ) | 1,899 | (14,182 | ) | |||||||||||||||||||||||||||
Income tax provision | 137 | — | 137 | 223 | — | 223 | 157 | — | 157 | 733 | — | 733 | ||||||||||||||||||||||||||||||||||||
Net loss | $ | (18,009 | ) | $ | (1,471 | ) | $ | (19,480 | ) | $ | (21,639 | ) | $ | 739 | $ | (20,900 | ) | $ | (18,312 | ) | $ | 8,128 | $ | (10,184 | ) | $ | (16,814 | ) | $ | 1,899 | $ | (14,915 | ) | |||||||||||||||
Net loss per share, basic and diluted | $ | (3.46 | ) | $ | (0.28 | ) | $ | (3.74 | ) | $ | (3.82 | ) | $ | 0.13 | $ | (3.69 | ) | $ | (3.18 | ) | $ | 1.41 | $ | (1.77 | ) | $ | (2.89 | ) | $ | 0.33 | $ | (2.56 | ) | |||||||||||||||
Fiscal Year 2017 | Q1 2017 | Q2 2017 | Q3 2017 | Q4 2017 | ||||||||||||||||||||||||||||||||||||||||||||
As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | As Reported | Impact of Adoption | As Adjusted | |||||||||||||||||||||||||||||||||||||
Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
Product | $ | 22,105 | $ | (1,797 | ) | $ | 20,308 | $ | 22,592 | $ | 4,250 | $ | 26,842 | $ | 39,192 | $ | 4,012 | $ | 43,204 | $ | 37,524 | $ | (2,530 | ) | $ | 34,994 | ||||||||||||||||||||||
Maintenance and professional services | 22,248 | (380 | ) | 21,868 | 23,614 | (475 | ) | 23,139 | 25,164 | 972 | 26,136 | 28,432 | (519 | ) | 27,913 | |||||||||||||||||||||||||||||||||
Total revenue | 44,353 | (2,177 | ) | 42,176 | 46,206 | 3,775 | 49,981 | 64,356 | 4,984 | 69,340 | 65,956 | (3,049 | ) | 62,907 | ||||||||||||||||||||||||||||||||||
Cost of revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
Product | 4,411 | (319 | ) | 4,092 | 5,505 | 40 | 5,545 | 7,201 | 39 | 7,240 | 6,981 | (17 | ) | 6,964 | ||||||||||||||||||||||||||||||||||
Maintenance and professional services | 8,431 | — | 8,431 | 8,543 | — | 8,543 | 8,688 | — | 8,688 | 9,109 | — | 9,109 | ||||||||||||||||||||||||||||||||||||
Total cost of revenue | 12,842 | (319 | ) | 12,523 | 14,048 | 40 | 14,088 | 15,889 | 39 | 15,928 | 16,090 | (17 | ) | 16,073 | ||||||||||||||||||||||||||||||||||
Total gross profit | 31,511 | (1,858 | ) | 29,653 | 32,158 | 3,735 | 35,893 | 48,467 | 4,945 | 53,412 | 49,866 | (3,032 | ) | 46,834 | ||||||||||||||||||||||||||||||||||
Gross margin | 71 | % | (1 | )% | 70 | % | 70 | % | 2 | % | 72 | % | 75 | % | 2 | % | 77 | % | 76 | % | (2 | )% | 74 | % | ||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||
Research and development | 10,947 | — | 10,947 | 10,702 | — | 10,702 | 10,985 | — | 10,985 | 14,801 | — | 14,801 | ||||||||||||||||||||||||||||||||||||
Sales and marketing | 34,454 | 591 | 35,045 | 35,104 | (1,548 | ) | 33,556 | 34,957 | (929 | ) | 34,028 | 46,578 | (4,809 | ) | 41,769 | |||||||||||||||||||||||||||||||||
General and administrative | 9,215 | — | 9,215 | 8,902 | — | 8,902 | 9,148 | — | 9,148 | 23,941 | — | 23,941 | ||||||||||||||||||||||||||||||||||||
Total operating expenses | 54,616 | 591 | 55,207 | 54,708 | (1,548 | ) | 53,160 | 55,090 | (929 | ) | 54,161 | 85,320 | (4,809 | ) | 80,511 | |||||||||||||||||||||||||||||||||
Loss from operations | (23,105 | ) | (2,449 | ) | (25,554 | ) | (22,550 | ) | 5,283 | (17,267 | ) | (6,623 | ) | 5,874 | (749 | ) | (35,454 | ) | 1,777 | (33,677 | ) | |||||||||||||||||||||||||||
Interest expense | (345 | ) | — | (345 | ) | (318 | ) | — | (318 | ) | (290 | ) | — | (290 | ) | (270 | ) | — | (270 | ) | ||||||||||||||||||||||||||||
Other income (expense), net | (144 | ) | — | (144 | ) | (82 | ) | — | (82 | ) | 160 | — | 160 | 382 | — | 382 | ||||||||||||||||||||||||||||||||
Revaluation of warrant liabilities | (392 | ) | — | (392 | ) | 50 | — | 50 | — | — | — | (385 | ) | — | (385 | ) | ||||||||||||||||||||||||||||||||
Loss before income taxes | (23,986 | ) | (2,449 | ) | (26,435 | ) | (22,900 | ) | 5,283 | (17,617 | ) | (6,753 | ) | 5,874 | (879 | ) | (35,727 | ) | 1,777 | (33,950 | ) | |||||||||||||||||||||||||||
Income tax provision | 635 | — | 635 | 174 | — | 174 | 412 | — | 412 | 618 | — | 618 | ||||||||||||||||||||||||||||||||||||
Net loss | $ | (24,621 | ) | $ | (2,449 | ) | $ | (27,070 | ) | $ | (23,074 | ) | $ | 5,283 | $ | (17,791 | ) | $ | (7,165 | ) | $ | 5,874 | $ | (1,291 | ) | $ | (36,345 | ) | $ | 1,777 | $ | (34,568 | ) | |||||||||||||||
Deemed dividend on the conversion of Series G redeemable convertible preferred stock | — | — | — | — | — | — | — | — | — | 12,810 | — | 12,810 | ||||||||||||||||||||||||||||||||||||
Net loss attributable to common stockholders | $ | (24,621 | ) | $ | (2,449 | ) | $ | (27,070 | ) | $ | (23,074 | ) | $ | 5,283 | $ | (17,791 | ) | $ | (7,165 | ) | $ | 5,874 | $ | (1,291 | ) | $ | (49,155 | ) | $ | 1,777 | $ | (47,378 | ) | |||||||||||||||
Net loss per share attributable to common stockholders, basic and diluted | $ | (4.16 | ) | $ | (0.41 | ) | $ | (4.57 | ) | $ | (3.83 | ) | $ | 0.88 | $ | (2.95 | ) | $ | (1.17 | ) | $ | 0.96 | $ | (0.21 | ) | $ | (1.80 | ) | $ | 0.07 | $ | (1.73 | ) | |||||||||||||||
Restated quarterly results reflect the adoption of the new revenue recognition standard. Previously reported quarterly results for fiscal year 2016 and 2017 were derived from unaudited quarterly financial results presented.