SecureWorks Corp. (SCWX) Tops Q3 EPS by 4c, Revenues Beat; Offers Q4 & FY20 EPS/Revenue Guidance Above Consensus

SecureWorks Corp. (NASDAQ: SCWX) reported Q3 EPS of $0.01, $0.04 better than the analyst estimate of ($0.03). Revenue for the quarter came in at $141.3 million versus the consensus estimate of $136.05 million.

Third Quarter Fiscal 2020 Highlights

• Revenue of $141.3 million, increased 6.2 percent from the third quarter of fiscal 2019, including an increase of 18 percent, internationally.
• GAAP net loss in the third quarter of fiscal 2020 was $7.9 million or $0.10 on a per share basis.
• Non-GAAP earnings were $0.01 per share and Adjusted EBITDA was $5.8 million.
• Cash provided by operating activities was $22.6 million in the third quarter, bringing year-to-date cash provided by operating activities to $35.9 million, compared with $26.0 million third quarter year-to-date in fiscal 2019.

“In the world of accelerating digital transformation and complex technology ecosystems, effective security programs require a more agile and scalable model. Our model goes beyond prevention alone, to leverage the powerful combination of machine and human intelligence and the community. As a global leader in the security industry, we are proud to partner with other leading security and technology companies to deliver solutions to the market that work in concert to increase the speed of detection and effectiveness of response to reduce risk,” said Michael R. Cote, Chief Executive Officer of Secureworks.

“Revenue, gross margin, adjusted EBITDA and cash flow were strong again in the third quarter and exceeded our expectations. We continue to invest in our security analytics platform and SaaS-based offerings and, as we finish the year, we remain focused on building upon our progress, driving our business transformation and bringing our vision of the future of security to life,” continued Mr. Cote.

GUIDANCE:

SecureWorks Corp. sees Q4 2020 EPS of ($0.01)-$0.00, versus the consensus of ($0.03). SecureWorks Corp. sees Q4 2020 revenue of $138-140 million, versus the consensus of $137.06 million.

SecureWorks Corp. sees FY2020 EPS of ($0.03)-($0.02), versus the consensus of ($0.10). SecureWorks Corp. sees FY2020 revenue of $549-551 billion, versus the consensus of $542.75 billion.

For the fourth quarter of fiscal 2020, the Company expects:

• Revenue of $138 to $140 million on both a GAAP and non-GAAP basis.
• GAAP net loss per share of $0.13 to $0.12 and non-GAAP net loss per share of $0.01 to $0.00.

Based on third quarter fiscal 2020 performance and current business trends, the Company has updated its guidance for the full fiscal year 2020. The Company now expects:

• GAAP and non-GAAP revenue of $549 to $551 million.
• GAAP net loss of $37 to $36 million and $0.46 to $0.45 on a per share basis.
• Non-GAAP net loss per share of $0.03 to $0.02.
• Adjusted EBITDA of $11 to $12 million.
• Cash flow from operations of $45 to $50 million.

For earnings history and earnings-related data on SecureWorks Corp. (SCWX) click here.

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