"We are pleased to end the year on a high note as 2018 was a year marked by robust growth and record results," said Barak Eilam, CEO of NICE. "For the full-year 2018, we reported strong growth in cloud revenue and operating income, an increase in recurring revenue, further growth in the operating margin and a record year for cash flow generation."
Mr. Eilam continued, "We are stepping into 2019 with great momentum across all of our businesses fueled by our two market differentiating platforms - CXone for Customer Engagement and X-Sight for Financial Crime and Compliance. Our assets, investments and market leadership in cloud, analytics and artificial intelligence are driving us forward and providing tremendous future opportunities.
"As we look ahead to the next five years, our strong leadership position will allow us to quickly expand into a total addressable market of over $12 billion from $7 billion today, providing us the opportunity to far exceed the $2 billion revenue mark, to see the majority of our revenue come from the cloud and to have a greater than 30% operating margin."
NICE Investor Day
NICE will be hosting its Investor Day on April 16th in conjunction with its Interactions annual user conference in Las Vegas. The special program for analysts and investors will include meetings with NICE executives, presentations from customers, product and technology sessions, and access to the solutions showcase. If you haven't registered, please email NICE at
GAAP Financial Highlights for the Fourth Quarter and Full Year Ended December 31:
The GAAP numbers presented below for the fourth quarter and full year 2018 are under ASC 606 and the comparison period GAAP numbers for the fourth quarter and full year 2017 are under ASC 605.
Revenues: Fourth quarter 2018 total revenues increased 4.7% to $410.8 million compared to $392.2 million for the fourth quarter of 2017.
Full year 2018 total revenues increased 8.4% to $1,444.5 million compared to $1,332.2 million for the full year 2017.
Gross Profit: Fourth quarter 2018 gross profit increased to $274.7 million compared to $268.3 million for the fourth quarter of 2017 and fourth quarter 2018 gross margin was 66.9% compared to 68.4% for the fourth quarter of 2017. Full year 2018 gross profit and gross margin increased to $947.7 million and 65.6%, respectively, compared to $863.5 million and 64.8%, respectively, for the full year 2017.
Operating Income: Fourth quarter 2018 operating income and operating margin increased to $70.4 million and 17.1%, respectively, compared to $63.2 million and 16.1%, respectively, for the fourth quarter of 2017.
Full year 2018 operating income and operating margin increased to $197.6 million and 13.7%, respectively, compared to $150.1 million and 11.3%, respectively, for the full year 2017.
Net Income: Fourth quarter 2018 net income and net income margin were $62.3 million and 15.2%, respectively, compared to $79.4 million and 20.2%, respectively, for the fourth quarter of 2017.
Full year 2018 net income and net income margin increased to $159.3 million and 11.0%, respectively, compared to $143.3 million and 10.8%, respectively, for the full year 2017.
Fully Diluted Earnings Per Share: Fully diluted earnings per share for the fourth quarter of 2018 was $0.98 compared to $1.27 in the fourth quarter of 2017.
Fully diluted earnings per share for the full year 2018 increased to $2.52 compared to $2.31 for the full year 2017.
Operating Cash Flow and Cash Balance: Fourth quarter 2018 operating cash flow was $108.9 million and full year operating cash flow reached $396.6 million. In the fourth quarter, $15.4 million was used for share repurchases and $26.0 million was used for share repurchases for the full year of 2018. As of December 31, 2018, total cash and cash equivalents, short term investments and marketable securities were $730.8 million, and total debt was $456.0 million.
Non-GAAP Financial Highlights for the Fourth Quarter and Full Year Ended December 31:
The non-GAAP numbers presented below for the fourth quarter and full year 2018 and the comparison period non- GAAP numbers for the fourth quarter and full year 2017 are both under ASC 605.
Revenues: Fourth quarter 2018 non-GAAP total revenues increased to $419.9 million, up 6.1% from $395.8 million for the fourth quarter of 2017.
Non-GAAP total revenues for the full year 2018 increased 8.7% to $1,462.7 million compared to $1,345.9 million for the full year 2017.
Gross Profit: Fourth quarter 2018 non-GAAP gross profit increased to $303.8 million compared to $293.5 million for the fourth quarter of 2017. Fourth quarter 2018 Non-GAAP gross margin was 72.4% compared to 74.2% for the fourth quarter of 2017.
Full year 2018 non-GAAP gross profit increased to $1,040.6 million compared to $963.5 million and full year 2018 non- GAAP gross margin was 71.1% compared to 71.6% for the full year 2017.
Operating Income: Fourth quarter 2018 non-GAAP operating income increased to $118.7 million compared to $112.4 million for the fourth quarter of 2017. Fourth quarter 2018 Non-GAAP operating margin was 28.3% compared to 28.4% for the fourth quarter of 2017.
Full year 2018 non-GAAP operating income and non-GAAP operating margin increased to $378.6 million and 25.9%, respectively, from $336.3 million and 25.0%, respectively, for the full year 2017.
Net Income: Fourth quarter 2018 non-GAAP net income and non-GAAP net income margin increased to $93.9 million and 22.4%, respectively, from $84.5 million and 21.3%, respectively, for the fourth quarter of 2017.
Full year 2018 non-GAAP net income and non-GAAP net income margin increased to $296.7 million and 20.3%, respectively, from $254.5 million and 18.9%, respectively, for the full year 2017.
Fully Diluted Earnings Per Share: Fourth quarter 2018 non-GAAP fully diluted earnings per share increased 8.9% to $1.47, compared to $1.35 for the fourth quarter of 2017.
Full year 2018 non-GAAP fully diluted earnings per share increased 14.4% to $4.69 compared to $4.10 for the full year 2017.
First Quarter and Full Year 2019 Guidance:
Effective January 1st, 2018, the company adopted ASC 606 using the modified retrospective method for GAAP reporting purposes. Starting in January 2019 the guidance, as well as our financial results, will be provided using the accounting standard ASC 606 for all 2019 quarters and the full year 2019. Comparative results throughout 2019 will be compared to ASC 606 results for
First Quarter 2019: First quarter 2019 non-GAAP total revenues are expected to be in a range of $370 million to $380 million (2018 non-GAAP: $337.6 million). First quarter 2019 non-GAAP fully diluted earnings per share are expected to be in a range of $1.05 to $1.15 (2018 non-GAAP: $0.97).
Full Year 2019: Full year 2019 non-GAAP total revenues are expected to be in a range of $1,558 million to $1,582 million (2018 non-GAAP: $1,453.4 million). Full year 2019 non-GAAP fully diluted earnings per share are expected to be in a range of $5.08 to $5.28 (2018 non-GAAP: $4.75).
Quarterly Results Conference Call
NICE management will host its earnings conference call today, February 14th, 2019 at 8:30 AM ET, 13:30 GMT, 15:30 Israel, to discuss the results and the company's outlook. To participate in the call, please dial in to the following numbers: United States 1-866-804-8688 or +1-718-354-1175, International +44(0)1296-480-100, United Kingdom 0-800-783-0906, Israel 1-809-344-364. The Passcode is 990 622 84. Additional access numbers can be found at
http://www.btconferencing.com/globalaccess/?bid=54_attended. The call will be webcast live on the Company's website at
http://www.nice.com/news-and-events/ir-events. An online replay will also be available approximately two hours following the call. A telephone replay of the call will be available for 7 days after the live broadcast, and may be accessed by dialing: United States 1-877-482-6144, International +44(0)20-7136-9233, United Kingdom 0-800-032- 9687. The Passcode for the replay is 635 176 28.
Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude: amortization of acquired intangible assets, share-based compensation, certain business combination accounting entries, amortization of discount on long term debt, re-organization expenses, tax adjustment re non-GAAP adjustments and tax reform and ASC 606 to ASC 605 adjustments. The purpose of such adjustments is to give an indication of our performance exclusive of non- cash charges and other items that are considered by management to be outside of our core operating results. Our non- GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Business combination accounting rules requires us to recognize a legal performance obligation related to a revenue arrangement of an acquired entity. The amount assigned to that liability should be based on its fair value at the date of acquisition. The non-GAAP adjustment is intended to reflect the full amount of such revenue. We believe this adjustment is useful to investors as a measure of the ongoing performance of our business. We believe these non-GAAP financial measures provide consistent and comparable measures to help investors understand our current and future operating cash flow performance. These non- GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income.
NICE (Nasdaq: NICE) is the worldwide leading provider of both cloud and on-premises enterprise software solutions that empower organizations to make smarter decisions based on advanced analytics of structured and unstructured data. NICE helps organizations of all sizes deliver better customer service, ensure compliance, combat fraud and safeguard citizens. Over 25,000 organizations in more than 150 countries, including over 85 of the Fortune 100 companies, are using NICE solutions.
Marty Cohen, +1 551 256 5354,
Yisca Erez, +972 9 775-3798,
Chris Irwin-Dudek, +1 (551) 256-5140,
Trademark Note: NICE and the NICE logo are trademarks or registered trademarks of NICE. All other marks are trademarks of their respective owners. For a full list of NICE' marks, please see:
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements may be identified by words such as "believe," "expect," "seek," "may," "will," "intend," "should," "project," "anticipate," "plan," and similar expressions. Forward-looking statements are based on the current beliefs, expectations and assumptions of the Company's management regarding the future of the Company's business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Examples of forward-looking statements include guidance regarding the Company's revenue and earnings and the growth of our cloud, analytics and artificial intelligence business.
Forward looking statements are inherently subject to significant economic, competitive and other uncertainties and contingencies, many of which are beyond the control of management. The Company cautions that these statements are not guarantees of future performance, and investors should not place undue reliance on them. There are or will be important
known and unknown factors and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. These factors, include, but are not limited to, risks associated with competition, success and growth of the Company's cloud Software-as-a-Service business, cyber security attacks or other security breaches against the Company, privacy concerns and legislation impacting the Company's business, the Company's dependency on fourth-party cloud computing platform providers, hosting facilities and service partners, changes in general economic and business conditions, rapidly changing technology, changes in currency exchange rates and interest rates, difficulties in making additional acquisitions or effectively integrating acquired operations, products, technologies and personnel, successful execution of the Company's growth strategy, the effects of tax reforms and of newly enacted or modified laws, regulation or standards on the Company and its products, and other factors and uncertainties discussed in our filings with the U.S. Securities and Exchange Commission (the "SEC"). You are encouraged to carefully review the section entitled "Risk Factors" in our latest Annual Report on Form 20-F and our other filings with the SEC for additional information regarding these and other factors and uncertainties that could affect our future performance. The forward-looking statements contained in this presentation speak only as of the date hereof, and the Company undertakes no obligation to update or revise them, whether as a result of new information, future developments or otherwise, except as required by law.