ServiceSource (SREV) Announces Preliminary Q3 Results and Revised '18 Outlook

ServiceSource (NASDAQ: SREV) (the “Company”), a global leader in outsourced inside sales, customer success and recurring revenue growth and retention solutions, today announced preliminary financial results for the quarter ended September 30, 2018 and updates to its fiscal 2018 revenue outlook.

“After a strong start to the year, several factors began to take shape late in the third quarter that have impacted our financial results for Q3 and our outlook for the balance of the year,” said Christopher M. Carrington, CEO of ServiceSource. “While our forecasts for new logo ramps and install base growth were generally in line across our portfolio, as we closed the quarter we experienced unexpected churn and softer end-user demand at several clients. The impact of these factors offsets the positive progression we experienced across the remainder of our business and alters our view for the balance of the year.”

The Company now expects third quarter revenue of approximately $57 million, compared to its previous guidance of $60 million to $61 million. Based on the preliminary third quarter 2018 results and the Company’s current view of the fourth quarter, ServiceSource is also revising its fiscal 2018 revenue outlook and now expects full-year revenue of $238 million to $240 million. The Company anticipates a meaningful portion of the revenue delta compared to expectations to flow through the P&L. ServiceSource intends to provide updated full fiscal 2018 guidance when it reports completed financial results for the third quarter 2018 on November 7, 2018, after market close.

(**Street sees Q3 revenue of $60.50 and FY revenue of $247.9 million)

Carrington continued, “As some of our clients adapt their go-to-market models and customer engagement strategies, in select cases their businesses are exposed to greater near-term volatility that impacts our forecasting. We are implementing specific actions in response to these challenges and other catalysts give us reason for sustained optimism. In recent months we have attracted three new executive leaders to further advance the Company, we have signed 12 new logos year-to-date, client net promoter scores continue to improve, and we have a strong balance sheet and liquidity profile. We look forward to providing additional details on the actions we are taking and the progress we are making on our earnings call in November.”

Third Quarter 2018 Financial Results Conference Call

ServiceSource also today announced that it will release its financial results for the third quarter ended September 30, 2018 after market close on November 7, 2018. ServiceSource will host a conference call at 2:30 p.m. Mountain Time (4:30 p.m. Eastern Time) that day to review financial results and business outlook.

To access the call, please dial (877) 293-5486, or outside the U.S. (914) 495-8592, at least five minutes prior to the 2:30 p.m. MT start time. A live webcast of the call will also be available on the ServiceSource Investor Relations website under Events and Presentations. A replay of the webcast will also be available on the Company's Investor Relations website at http://ir.servicesource.com.

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