Varonis Systems (NASDAQ: VRNS) reported Q2 EPS of ($0.08), $0.03 worse than the analyst estimate of ($0.05). Revenue for the quarter came in at $62.19 million versus the consensus estimate of $62.17 million.

Yaki Faitelson, Varonis CEO, said, “Demand for our solutions globally remains strong. There is an increasing need for companies to track and protect their data wherever it is stored, on-premises or in the cloud, reducing risk, preventing breaches, and meeting compliance requirements. With our platform approach, an increasing number of customers are adopting more product families, driving our land and expand strategy and total customer lifetime value. We continue to make good progress on our strategy to drive meaningful levels of growth, profit and cash flow over time.”

Financial Highlights for the Second Quarter Ended June 30, 2018

Revenues:

• Total revenues were $62.2 million, up 26% compared with the second quarter of 2017.
• License revenues were $33.5 million, up 23% compared with the second quarter of 2017.
• Maintenance and services revenues were $28.7 million, up 30% compared with the second quarter of 2017.

Operating Loss:

• GAAP operating loss was ($11.3) million for the quarter, compared to ($6.1) million in the second quarter of 2017.
• Non-GAAP operating loss was ($1.0) million for the quarter, compared to ($0.6) million in the second quarter of 2017.

Net Loss:

• GAAP net loss was ($12.7) million, compared to GAAP net loss of ($5.7) million in the second quarter of 2017.
• GAAP net loss per basic and diluted share was ($0.44), compared to GAAP net loss per basic and diluted share of ($0.21) in the second quarter of 2017, based on 28.9 million and 27.3 million basic and diluted shares outstanding, respectively.
• Non-GAAP net loss was ($2.4) million, compared to a non-GAAP net loss of ($0.3) million in the second quarter of 2017.
• Non-GAAP net loss per basic and diluted share was ($0.08), compared to a non-GAAP net loss per basic and diluted share of ($0.01) in the second quarter of 2017, based on 28.9 million and 27.3 million basic and diluted shares outstanding, respectively.

Financial Outlook

For the third quarter of 2018, the Company expects revenues in the range of $64.0 million to $65.0 million, representing 20% to 22% year-over-year growth. The Company anticipates third quarter 2018 non-GAAP operating income in the range of breakeven to $1.0 million and non-GAAP net loss per basic and diluted share in the range of ($0.02) to non-GAAP net income per diluted share of $0.01, based on a tax provision of $500,000 to $700,000 and 29.3 million basic and 32.6 million diluted shares outstanding. Expectations of non-GAAP operating income and non-GAAP net income (loss) per basic and diluted share exclude stock-based compensation expense and payroll tax expense related to stock-based compensation.

For the full year 2018, the Company now expects revenues in the range of $265.0 million to $268.5 million, representing 23% to 25% year-over-year growth. The Company now anticipates full year 2018 non-GAAP operating income of $2.5 million to $4.5 million and non-GAAP net income per diluted share in the range of $0.00 to $0.05. This is based on a tax provision of $2.7 million to $3.2 million and 32.4 million diluted shares outstanding. Expectations of non-GAAP operating income and non-GAAP net income per diluted share exclude stock-based compensation expense and payroll tax expense related to stock-based compensation.

GUIDANCE:

Varonis Systems sees FY2018 EPS of $0.00-$0.05. Varonis Systems sees FY2018 revenue of $265-268.5 million.

For earnings history and earnings-related data on Varonis Systems (VRNS) click here.