|
1. |
Radware Reports Fourth Quarter and Full Year 2023 Financial Results, dated February 7, 2024
|
RADWARE LTD.
|
|||
Date: February 7, 2024
|
By:
|
/s/ Gadi Meroz
|
|
Gadi Meroz
|
|||
Vice President & General Counsel
|
Exhibit Number
|
Description of Exhibits
|
|
|
|
• |
Revenue of $65.0 million, down 12% year-over-year
|
|
• |
Cloud ARR of $64.9 million, up 22% year-over-year
|
|
• |
Non-GAAP EPS of $0.13; GAAP net loss per diluted share of $0.14
|
|
• |
Revenue of $261.3 million, down 11% year-over-year
|
|
• |
Non-GAAP EPS of $0.43; GAAP net loss per diluted share of $0.50
|
|
• |
Revenue in the Americas region was $24.6 million for the fourth quarter of 2023, a decrease of 23% from $31.9 million in the fourth quarter of 2022. Revenue in the
Americas region for the full year of 2023 was $103.4 million, a decrease of 17% from $123.9 million in the full year of 2022.
|
|
• |
Revenue in the Europe, Middle East, and Africa (“EMEA”) region was $24.9 million for the fourth quarter of 2023, an increase of 2% from $24.3 million in the fourth
quarter of 2022. Revenue in the EMEA region for the full year of 2023 was $96.5 million, a decrease of 7% from $104.2 million for the full year of 2022.
|
|
• |
Revenue in the Asia-Pacific (“APAC”) region was $15.5 million for the fourth quarter of 2023, a decrease of 13% from $17.9 million in the fourth quarter of 2022.
Revenue in the APAC region for the full year of 2023 was $61.4 million, a decrease of 6% from $65.3 million for the full year of 2022.
|
Radware Ltd.
|
Condensed Consolidated Balance Sheets
|
(U.S. Dollars in thousands)
|
|
December 31,
|
December 31,
|
||||||
|
2023
|
2022
|
||||||
|
(Unaudited)
|
(Unaudited)
|
||||||
Assets
|
||||||||
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
70,538
|
46,185
|
||||||
Marketable securities
|
86,372
|
44,180
|
||||||
Short-term bank deposits
|
173,678
|
207,679
|
||||||
Trade receivables, net
|
18,959
|
17,752
|
||||||
Other receivables and prepaid expenses
|
10,015
|
7,196
|
||||||
Inventories
|
15,544
|
11,428
|
||||||
|
375,106
|
334,420
|
||||||
|
||||||||
Long-term investments
|
||||||||
Marketable securities
|
33,131
|
90,148
|
||||||
Long-term bank deposits
|
-
|
43,765
|
||||||
Other assets
|
2,166
|
2,146
|
||||||
|
35,297
|
136,059
|
||||||
|
||||||||
Property and equipment, net
|
18,221
|
21,068
|
||||||
Intangible assets, net
|
15,718
|
19,686
|
||||||
Other long-term assets
|
39,161
|
41,269
|
||||||
Operating lease right-of-use assets
|
20,777
|
23,078
|
||||||
Goodwill
|
68,008
|
68,008
|
||||||
Total assets
|
572,288
|
643,588
|
||||||
|
||||||||
Liabilities and equity
|
||||||||
|
||||||||
Current liabilities
|
||||||||
Trade payables
|
4,298
|
6,464
|
||||||
Deferred revenues
|
103,703
|
108,243
|
||||||
Operating lease liabilities
|
4,684
|
4,685
|
||||||
Other payables and accrued expenses
|
41,650
|
44,643
|
||||||
|
154,335
|
164,035
|
||||||
|
||||||||
Long-term liabilities
|
||||||||
Deferred revenues
|
60,499
|
72,219
|
||||||
Operating lease liabilities
|
16,020
|
19,461
|
||||||
Other long-term liabilities
|
18,160
|
19,430
|
||||||
|
94,679
|
111,110
|
||||||
|
||||||||
Equity
|
||||||||
Radware Ltd. equity
|
||||||||
Share capital
|
733
|
732
|
||||||
Additional paid-in capital
|
529,218
|
498,168
|
||||||
Accumulated other comprehensive income (loss)
|
77
|
(4,844
|
)
|
|||||
Treasury stock, at cost
|
(365,749
|
)
|
(303,299
|
)
|
||||
Retained earnings
|
119,812
|
141,402
|
||||||
Total Radware Ltd. shareholder's equity
|
284,091
|
332,159
|
||||||
|
||||||||
Non–controlling interest
|
39,183
|
36,284
|
||||||
|
||||||||
Total equity
|
323,274
|
368,443
|
||||||
|
||||||||
Total liabilities and equity
|
572,288
|
643,588
|
Radware Ltd.
|
Condensed Consolidated Statements of Income
|
(U.S Dollars in thousands, except share and per share data)
|
|
For the three months ended
|
For the year ended
|
||||||||||||||
|
December 31,
|
December 31,
|
||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
Revenues
|
65,032
|
74,083
|
261,292
|
293,426
|
||||||||||||
Cost of revenues
|
12,824
|
13,917
|
51,710
|
53,884
|
||||||||||||
Gross profit
|
52,208
|
60,166
|
209,582
|
239,542
|
||||||||||||
|
||||||||||||||||
Operating expenses, net:
|
||||||||||||||||
Research and development, net
|
19,712
|
22,486
|
82,617
|
86,562
|
||||||||||||
Selling and marketing
|
31,869
|
32,544
|
126,237
|
126,533
|
||||||||||||
General and administrative
|
8,030
|
10,244
|
32,408
|
29,786
|
||||||||||||
Total operating expenses, net
|
59,611
|
65,274
|
241,262
|
242,881
|
||||||||||||
|
||||||||||||||||
Operating loss
|
(7,403
|
)
|
(5,108
|
)
|
(31,680
|
)
|
(3,339
|
)
|
||||||||
Financial income, net
|
3,239
|
2,018
|
13,927
|
8,052
|
||||||||||||
Income (Loss) before taxes on income
|
(4,164
|
)
|
(3,090
|
)
|
(17,753
|
)
|
4,713
|
|||||||||
Taxes on income
|
1,686
|
1,034
|
3,837
|
4,879
|
||||||||||||
Net loss
|
(5,850
|
)
|
(4,124
|
)
|
(21,590
|
)
|
(166
|
)
|
||||||||
|
||||||||||||||||
Basic net loss per share attributed to Radware Ltd.'s shareholders
|
(0.14
|
)
|
(0.09
|
)
|
(0.50
|
)
|
(0.00
|
)
|
||||||||
|
||||||||||||||||
Weighted average number of shares used to compute basic net loss per share
|
41,806,042
|
44,586,590
|
42,871,770
|
44,943,168
|
||||||||||||
|
||||||||||||||||
Diluted net loss per share attributed to Radware Ltd.'s shareholders
|
(0.14
|
)
|
(0.09
|
)
|
(0.50
|
)
|
(0.00
|
)
|
||||||||
|
||||||||||||||||
Weighted average number of shares used to compute diluted net loss per share
|
41,806,042
|
44,586,590
|
42,871,770
|
44,943,168
|
Radware Ltd.
|
Reconciliation of GAAP to Non-GAAP Financial Information
|
(U.S Dollars in thousands, except share and per share data)
|
|
For the three months ended
|
For the year ended
|
||||||||||||||
|
December 31,
|
December 31,
|
||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
GAAP gross profit
|
52,208
|
60,166
|
209,582
|
239,542
|
||||||||||||
Share-based compensation
|
112
|
112
|
515
|
399
|
||||||||||||
Amortization of intangible assets
|
992
|
992
|
3,968
|
3,704
|
||||||||||||
Non-GAAP gross profit
|
53,312
|
61,270
|
214,065
|
243,645
|
||||||||||||
|
||||||||||||||||
GAAP research and development, net
|
19,712
|
22,486
|
82,617
|
86,562
|
||||||||||||
Share-based compensation
|
2,305
|
2,073
|
8,505
|
7,292
|
||||||||||||
Non-GAAP Research and development, net
|
17,407
|
20,413
|
74,112
|
79,270
|
||||||||||||
|
||||||||||||||||
GAAP selling and marketing
|
31,869
|
32,544
|
126,237
|
126,533
|
||||||||||||
Share-based compensation
|
3,489
|
2,993
|
12,554
|
11,241
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Non-GAAP selling and marketing
|
27,802
|
29,551
|
111,832
|
115,292
|
||||||||||||
|
||||||||||||||||
GAAP general and administrative
|
8,030
|
10,244
|
32,408
|
29,786
|
||||||||||||
Share-based compensation
|
2,965
|
4,480
|
12,448
|
8,421
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Non-GAAP general and administrative
|
4,706
|
4,945
|
18,832
|
19,404
|
||||||||||||
|
||||||||||||||||
GAAP total operating expenses, net
|
59,611
|
65,274
|
241,262
|
242,881
|
||||||||||||
Share-based compensation
|
8,759
|
9,546
|
33,507
|
26,954
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Non-GAAP total operating expenses, net
|
49,915
|
54,909
|
204,776
|
213,966
|
||||||||||||
|
||||||||||||||||
GAAP operating loss
|
(7,403
|
)
|
(5,108
|
)
|
(31,680
|
)
|
(3,339
|
)
|
||||||||
Share-based compensation
|
8,871
|
9,658
|
34,022
|
27,353
|
||||||||||||
Amortization of intangible assets
|
992
|
992
|
3,968
|
3,704
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Non-GAAP operating income
|
3,397
|
6,361
|
9,289
|
29,679
|
||||||||||||
|
||||||||||||||||
GAAP financial income, net
|
3,239
|
2,018
|
13,927
|
8,052
|
||||||||||||
Exchange rate differences, net on balance sheet items included in financial income, net
|
563
|
413
|
(207
|
)
|
(1,301
|
)
|
||||||||||
Non-GAAP financial income, net
|
3,802
|
2,431
|
13,720
|
6,751
|
||||||||||||
|
||||||||||||||||
GAAP income (loss) before taxes on income
|
(4,164
|
)
|
(3,090
|
)
|
(17,753
|
)
|
4,713
|
|||||||||
Share-based compensation
|
8,871
|
9,658
|
34,022
|
27,353
|
||||||||||||
Amortization of intangible assets
|
992
|
992
|
3,968
|
3,704
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Exchange rate differences, net on balance sheet items included in financial income, net
|
563
|
413
|
(207
|
)
|
(1,301
|
)
|
||||||||||
Non-GAAP income before taxes on income
|
7,199
|
8,792
|
23,009
|
36,430
|
||||||||||||
|
||||||||||||||||
GAAP taxes on income
|
1,686
|
1,034
|
3,837
|
4,879
|
||||||||||||
Tax related adjustments
|
61
|
61
|
246
|
246
|
||||||||||||
Non-GAAP taxes on income
|
1,747
|
1,095
|
4,083
|
5,125
|
||||||||||||
|
||||||||||||||||
GAAP net loss
|
(5,850
|
)
|
(4,124
|
)
|
(21,590
|
)
|
(166
|
)
|
||||||||
Share-based compensation
|
8,871
|
9,658
|
34,022
|
27,353
|
||||||||||||
Amortization of intangible assets
|
992
|
992
|
3,968
|
3,704
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Exchange rate differences, net on balance sheet items included in financial income, net
|
563
|
413
|
(207
|
)
|
(1,301
|
)
|
||||||||||
Tax related adjustments
|
(61
|
)
|
(61
|
)
|
(246
|
)
|
(246
|
)
|
||||||||
Non-GAAP net income
|
5,452
|
7,697
|
18,926
|
31,305
|
||||||||||||
|
||||||||||||||||
GAAP diluted net loss per share
|
(0.14
|
)
|
(0.09
|
)
|
(0.50
|
)
|
(0.00
|
)
|
||||||||
Share-based compensation
|
0.21
|
0.21
|
0.78
|
0.60
|
||||||||||||
Amortization of intangible assets
|
0.02
|
0.02
|
0.09
|
0.08
|
||||||||||||
Restructuring costs
|
0.02
|
0.00
|
0.04
|
0.00
|
||||||||||||
Acquisition costs
|
0.01
|
0.02
|
0.03
|
0.04
|
||||||||||||
Exchange rate differences, net on balance sheet items included in financial income, net
|
0.01
|
0.01
|
(0.00
|
)
|
(0.03
|
)
|
||||||||||
Tax related adjustments
|
(0.00
|
)
|
(0.00
|
)
|
(0.01
|
)
|
(0.01
|
)
|
||||||||
Non-GAAP diluted net earnings per share
|
0.13
|
0.17
|
0.43
|
0.68
|
||||||||||||
|
||||||||||||||||
Weighted average number of shares used to compute non-GAAP diluted net earnings per share
|
42,462,751
|
45,227,288
|
43,655,555
|
45,947,476
|
Radware Ltd.
|
RECONCILIATION OF GAAP NET LOSS TO EBITDA AND ADJUSTED EBITDA (NON-GAAP)
|
(U.S Dollars in thousands)
|
|
For the three months ended
|
For the twelve months ended
|
||||||||||||||
|
December 31,
|
December 31,
|
||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
GAAP net loss
|
(5,850
|
)
|
(4,124
|
)
|
(21,590
|
)
|
(166
|
)
|
||||||||
Exclude: Financial income, net
|
(3,239
|
)
|
(2,018
|
)
|
(13,927
|
)
|
(8,052
|
)
|
||||||||
Exclude: Depreciation and amortization expense
|
3,028
|
2,878
|
12,244
|
11,692
|
||||||||||||
Exclude: Taxes on income
|
1,686
|
1,034
|
3,837
|
4,879
|
||||||||||||
EBITDA
|
(4,375
|
)
|
(2,230
|
)
|
(19,436
|
)
|
8,353
|
|||||||||
|
||||||||||||||||
Share-based compensation
|
8,871
|
9,658
|
34,022
|
27,353
|
||||||||||||
Restructuring costs
|
578
|
-
|
1,851
|
-
|
||||||||||||
Acquisition costs
|
359
|
819
|
1,128
|
1,961
|
||||||||||||
Adjusted EBITDA
|
5,433
|
8,247
|
17,565
|
37,667
|
|
For the three months ended
|
For the twelve months ended
|
||||||||||||||
|
December 31,
|
December 31,
|
||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
||||||||||||||||
Amortization of intangible assets
|
992
|
992
|
3,968
|
3,704
|
||||||||||||
Depreciation
|
2,036
|
1,886
|
8,276
|
7,988
|
||||||||||||
|
||||||||||||||||
|
3,028
|
2,878
|
12,244
|
11,692
|
Radware Ltd.
|
Condensed Consolidated Statements of Cash Flow
|
(U.S. Dollars in thousands)
|
|
For the three months ended
|
For the year ended
|
||||||||||||||
|
December 31,
|
December 31,
|
||||||||||||||
|
2023
|
2022
|
2023
|
2022
|
||||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
Cash flow from operating activities:
|
||||||||||||||||
|
||||||||||||||||
Net loss
|
(5,850
|
)
|
(4,124
|
)
|
(21,590
|
)
|
(166
|
)
|
||||||||
Adjustments to reconcile net loss to net cash provided by operating activities:
|
||||||||||||||||
Depreciation and amortization
|
3,028
|
2,878
|
12,244
|
11,692
|
||||||||||||
Share-based compensation
|
8,871
|
9,658
|
34,022
|
27,353
|
||||||||||||
Amortization of premium, accretion of discounts and accrued interest on marketable securities, net
|
638
|
766
|
1,754
|
2,345
|
||||||||||||
Loss (gain) related to securities, net
|
(1
|
)
|
(4
|
)
|
243
|
(68
|
)
|
|||||||||
Increase (decrease) in accrued interest on bank deposits
|
549
|
(1,424
|
)
|
(3,265
|
)
|
(2,480
|
)
|
|||||||||
Increase (decrease) in accrued severance pay, net
|
207
|
301
|
(299
|
)
|
219
|
|||||||||||
Increase in trade receivables, net
|
(6,587
|
)
|
(4,401
|
)
|
(1,207
|
)
|
(4,561
|
)
|
||||||||
Decrease (increase) in other receivables and prepaid expenses and other long-term assets
|
1,017
|
(1,887
|
)
|
(1,524
|
)
|
(2,360
|
)
|
|||||||||
Decrease (increase) in inventories
|
(2,550
|
)
|
(574
|
)
|
(4,116
|
)
|
152
|
|||||||||
Increase (decrease) in trade payables
|
(1,771
|
)
|
(306
|
)
|
(2,166
|
)
|
2,154
|
|||||||||
Increase (decrease) in deferred revenues
|
(5,165
|
)
|
1,584
|
(16,260
|
)
|
13,475
|
||||||||||
Increase (decrease) in other payables and accrued expenses
|
10,603
|
6,665
|
(195
|
)
|
(14,054
|
)
|
||||||||||
Operating lease liabilities, net
|
(336
|
)
|
428
|
(1,141
|
)
|
(1,553
|
)
|
|||||||||
Net cash provided by (used in) operating activities
|
2,653
|
9,560
|
(3,500
|
)
|
32,148
|
|||||||||||
|
||||||||||||||||
Cash flows from investing activities:
|
||||||||||||||||
|
||||||||||||||||
Purchase of property and equipment
|
(936
|
)
|
(1,768
|
)
|
(5,429
|
)
|
(8,814
|
)
|
||||||||
Proceeds from (investment in) other long-term assets, net
|
(11
|
)
|
(71
|
)
|
66
|
35
|
||||||||||
Proceeds from (investment in) bank deposits, net
|
29,686
|
5,824
|
81,031
|
(13,377
|
)
|
|||||||||||
Investment in, redemption of and purchase of marketable securities ,net
|
16,764
|
1,640
|
17,111
|
(3,862
|
)
|
|||||||||||
Payment for the business acquisition of SecurityDAM Ltd.
|
-
|
-
|
-
|
(30,000
|
)
|
|||||||||||
Net cash provided by (used in) investing activities
|
45,503
|
5,625
|
92,779
|
(56,018
|
)
|
|||||||||||
|
||||||||||||||||
Cash flows from financing activities:
|
||||||||||||||||
|
||||||||||||||||
Proceeds from exercise of share options
|
63
|
832
|
371
|
2,034
|
||||||||||||
Repurchase of shares
|
(10,103
|
)
|
(12,301
|
)
|
(63,234
|
)
|
(59,492
|
)
|
||||||||
Payment of deferred consideration related to acquisition
|
-
|
-
|
(2,063
|
)
|
-
|
|||||||||||
Proceeds from issuance of Preferred A shares in subsidiary
|
-
|
-
|
-
|
35,000
|
||||||||||||
Net cash used in financing activities
|
(10,040
|
)
|
(11,469
|
)
|
(64,926
|
)
|
(22,458
|
)
|
||||||||
|
||||||||||||||||
Increase (decrease) in cash and cash equivalents
|
38,116
|
3,716
|
24,353
|
(46,328
|
)
|
|||||||||||
Cash and cash equivalents at the beginning of the period
|
32,422
|
42,469
|
46,185
|
92,513
|
||||||||||||
Cash and cash equivalents at the end of the period
|
70,538
|
46,185
|
70,538
|
46,185
|