Cornerstone OnDemand (CSOD) Tops Q1 EPS by 6c, Revenues Beat; Offers 2Q & FY19 Revenue Mid-Point Guidance Above Consensus

Cornerstone OnDemand (NASDAQ: CSOD) reported Q1 EPS of $0.25, $0.06 better than the analyst estimate of $0.19. Revenue for the quarter came in at $140.1 million versus the consensus estimate of $135.57 million.

“We are off to a great start for 2019, continuing the momentum that we saw during 2018,” said Adam Miller, founder and CEO of Cornerstone. “With the skills divide making news almost every week, learning and development directors are embracing solutions like ours. The injection of our emerging content business into our massive installed base of more than 40 million users, is enabling us to truly differentiate.”

• Revenue for the first quarter of 2019 was $140.1 million compared to a guided range of $134.5 million to $136.5 million. This represents a 5.3% increase compared to the same period of the prior year. Revenue growth on a constant currency basis was 7.3%.
• Subscription revenue for the first quarter of 2019 was $131.3 million compared to a guided range of $127.5 million to $129.5 million. This represents a 16% increase compared to the same period of the prior year. Subscription revenue growth on a constant currency basis was 18.2%.
• Operating income for the first quarter of 2019 was $1.2 million, yielding a margin of 0.9%, compared to $(8.8) million and margin of (6.6)% in the same period of the prior year.
• Non-GAAP operating income for the first quarter of 2019 was $19.6 million, yielding a margin of 14%, compared to $12.9 million and margin of 9.7% in the same period of the prior year.
• Net loss for the first quarter of 2019 was $(3.5) million, or a $(0.06) diluted net loss per share, compared to $(16.2) million and $(0.28) diluted net loss per share in the same period of the prior year.
• Non-GAAP net income for the first quarter of 2019 was $15.9 million, or a $0.25 diluted net income per share, compared to $9.0 million and $0.14 diluted net loss per share in the same period of the prior year.
• Operating cash flow for the first quarter of 2019 was $7.3 million, yielding a margin of 5.2%, compared to $(4.6) million, yielding a margin of (3.4)%, in the same period of the prior year.
• Unlevered free cash flow for the first quarter of 2019 was $4.3 million, yielding a margin of 3.1%, compared to $(10.2) million, yielding a margin of (7.6)%, in the same period of the prior year.

“During Q1, we continued to expand our operating margins while investing in our key priorities,” said Brian Swartz, CFO of Cornerstone. “As we look out to the balance of 2019, we are encouraged by the opportunities we see ahead and are raising our financial guidanceaccordingly.”

GUIDANCE:

Cornerstone OnDemand sees Q2 2019 revenue of $137-140 million, versus the consensus of $137.36 million.

Cornerstone OnDemand sees FY2019 revenue of $562-570 million, versus the consensus of $563.72 million.

For earnings history and earnings-related data on Cornerstone OnDemand (CSOD) click here.

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