CyberArk Software (NASDAQ: CYBR) reported Q3 EPS of $0.31, $0.02 better than the analyst estimate of $0.29. Revenue for the quarter came in at $106.6 million versus the consensus estimate of $112.04 million.

Financial Highlights for the Third Quarter Ended September 30, 2020

Revenue:

• Total revenue was $106.6 million.
• License revenue was $45.8 million.
• Maintenance and professional services revenue was $60.8 million.

Operating Income (Loss):

• GAAP operating loss was $(10.5) million and non-GAAP operating income was $13.1 million.

Net Income (Loss):

• GAAP net loss was $(15.9) million, or $(0.41) per basic and diluted share. Non-GAAP net income was $12.2 million, or $0.31 per diluted share.

“We are pleased with the momentum in the business including posting another quarter of record SaaS bookings,” said Udi Mokady, CyberArk Chairman and CEO. “Enterprise demand for our SaaS solutions continued to build in the third quarter, particularly for CyberArk Privilege Cloud and Endpoint Privilege Manager. Customers are increasingly turning to CyberArk as their trusted advisor to securely implement digital transformation, cloud migration, and identity and risk reduction programs. Our ongoing cloud innovation, including CyberArk Cloud Entitlements Manager, our recently introduced AI-powered solution that strengthens cloud security, further extends our leadership position in the market. The significant increase in new SaaS and subscription bookings grew our annual recurring revenue (ARR) by 40 percent to $250 million and our deferred revenue by 28 percent to $228 million. In addition, the combination of SaaS and subscription revenue increased nearly 200 percent year over year and represents about 28 percent of total license revenue compared to 7 percent of license revenue in the third quarter of 2019. While the bookings mix shift toward high-value recurring subscriptions created a headwind to our recognized revenue and profitability in the quarter, looking through the near-term effect on the reported P&L, our business performance was strong and the level of customer and prospect engagement was at an all-time high.”

Continued Mokady, “As we look ahead, we will begin actively transitioning our business to a recurring revenue model in 2021, by further accelerating our SaaS business and shifting the Company sales from perpetual licenses to recurring subscriptions. As a result of our robust SaaS and subscription bookings, our strong and growing mix of recurring revenue, our expanding SaaS portfolio, and our comprehensive review of enterprise buying patterns, we are confident that our strategy will create significant long-term value for CyberArk, our customers, partners, and shareholders.”

GUIDANCE:

CyberArk Software sees Q4 2020 EPS of $0.52-$0.67, versus the consensus of $0.63. CyberArk Software sees Q4 2020 revenue of $125-135 million, versus the consensus of $136.46 million.

Business Outlook

Based on information available as of November 10, 2020, CyberArk is issuing guidance for the fourth quarter as indicated below.

Fourth Quarter 2020:

• Total revenue between $125.0 million and $135.0 million.
• Non-GAAP operating income between $25.0 million and $33.0 million.
• Non-GAAP net income per share between $0.52 and $0.67 per diluted share.
  • Estimated tax rate of 23 percent.
  • Assumes 40.0 million weighted average diluted shares.

For earnings history and earnings-related data on CyberArk Software (CYBR) click here.