Varonis Announces Second Quarter 2024 Financial Results
Varonis Systems, Inc. (VRNS) announced strong Q2 2024 financial results, highlighting 18% year-over-year growth in annual recurring revenues (ARR) to $584.2 million. SaaS ARR reached 36% of total ARR, reflecting growing momentum in their SaaS platform. Total revenues increased to $130.3 million, up from $115.4 million in Q2 2023. The company reported improved cash flow, generating $68.4 million from operations and $67.3 million in free cash flow year-to-date. Varonis raised its full-year ARR and free cash flow guidance, expecting ARR to reach $629.0-$635.0 million and free cash flow of $80.0-$85.0 million for 2024. The company also increased its SaaS ARR expectations to 48% for the full year, demonstrating strong adoption of its SaaS offerings.
Varonis Systems, Inc. (VRNS) ha annunciato risultati finanziari solidi per il secondo trimestre del 2024, evidenziando una crescita del 18% anno su anno nei ricavi ricorrenti annuali (ARR) raggiungendo $584,2 milioni. L'ARR SaaS ha raggiunto il 36% dell'ARR totale, riflettendo un crescente slancio nella loro piattaforma SaaS. I ricavi totali sono aumentati a $130,3 milioni, rispetto ai $115,4 milioni del secondo trimestre del 2023. L'azienda ha riportato un miglioramento del flusso di cassa, generando $68,4 milioni dalle operazioni e $67,3 milioni in flusso di cassa libero fino ad oggi. Varonis ha alzato le previsioni per l'ARR e il flusso di cassa libero per l'intero anno, aspettandosi che l'ARR raggiunga $629,0-$635,0 milioni e un flusso di cassa libero di $80,0-$85,0 milioni per il 2024. L'azienda ha anche aumentato le sue aspettative per l'ARR SaaS al 48% per l'intero anno, dimostrando una forte adozione delle sue offerte SaaS.
Varonis Systems, Inc. (VRNS) anunció sólidos resultados financieros para el segundo trimestre de 2024, destacando un crecimiento del 18% interanual en ingresos recurrentes anuales (ARR), alcanzando $584.2 millones. El ARR de SaaS alcanzó el 36% del ARR total, reflejando un creciente impulso en su plataforma SaaS. Los ingresos totales aumentaron a $130.3 millones, frente a los $115.4 millones del segundo trimestre de 2023. La compañía reportó una mejora en el flujo de caja, generando $68.4 millones de operaciones y $67.3 millones en flujo de caja libre hasta la fecha. Varonis elevó sus previsiones de ARR y flujo de caja libre para todo el año, esperando que el ARR alcance entre $629.0 y $635.0 millones y un flujo de caja libre de entre $80.0 y $85.0 millones para 2024. La compañía también incrementó sus expectativas de ARR de SaaS al 48% para el año completo, demostrando una fuerte adopción de sus ofertas de SaaS.
Varonis Systems, Inc. (VRNS)는 2024년 2분기 강력한 재무 결과를 발표하며 연간 반복 수익(ARR)이 전년 대비 18% 성장하여 $584.2 백만에 달했다고 강조했습니다. SaaS ARR은 전체 ARR의 36%에 도달하여 SaaS 플랫폼의 증가하는 모멘텀을 반영합니다. 총 수익은 $130.3 백만으로 증가했으며, 이는 2023년 2분기의 $115.4 백만에서 증가한 수치입니다. 회사는 운영에서 $68.4 백만을 생성하고 올해 현재까지 $67.3 백만의 자유 현금 흐름을 기록하여 현금 흐름 개선을 발표했습니다. Varonis는 연간 ARR과 자유 현금 흐름 전망을 상향 조정했으며, 2024년 ARR이 $629.0-$635.0백만, 자유 현금 흐름이 $80.0-$85.0백만에 이를 것으로 예상하고 있습니다. 회사는 SaaS ARR에 대한 기대치를 연간 48%로 늘려 SaaS 제공의 강력한 채택을 보여주고 있습니다.
Varonis Systems, Inc. (VRNS) a annoncé de solides résultats financiers pour le deuxième trimestre 2024, mettant en avant une croissance de 18 % d'une année sur l'autre des revenus récurrents annuels (ARR), atteignant 584,2 millions de dollars. L'ARR SaaS a atteint 36 % de l'ARR total, reflétant un élan croissant de leur plateforme SaaS. Les revenus totaux ont augmenté à 130,3 millions de dollars, contre 115,4 millions de dollars au deuxième trimestre 2023. L'entreprise a signalé une amélioration de son flux de trésorerie, générant 68,4 millions de dollars provenant des opérations et 67,3 millions de dollars de flux de trésorerie libre depuis le début de l'année. Varonis a rehaussé ses prévisions d'ARR et de flux de trésorerie libre pour l'année, s'attendant à ce que l'ARR atteigne entre 629 et 635 millions de dollars et le flux de trésorerie libre entre 80 et 85 millions de dollars pour 2024. L'entreprise a également augmenté ses prévisions d'ARR SaaS à 48 % pour l'année entière, démontrant une forte adoption de ses offres SaaS.
Varonis Systems, Inc. (VRNS) hat starke Finanzergebnisse für das zweite Quartal 2024 bekannt gegeben und hebt ein Wachstum von 18% im Jahresvergleich bei den wiederkehrenden Jahresumsätzen (ARR) auf $584,2 Millionen hervor. Das SaaS ARR erreichte 36% des gesamten ARR, was eine wachsende Dynamik auf ihrer SaaS-Plattform widerspiegelt. Die Gesamterlöse stiegen auf $130,3 Millionen, gegenüber $115,4 Millionen im 2. Quartal 2023. Das Unternehmen berichtete von einem verbesserten Cashflow und erwirtschaftete $68,4 Millionen aus den Betrieben sowie $67,3 Millionen an freiem Cashflow bis heute. Varonis hob seine Prognosen für das gesamte Jahr hinsichtlich ARR und freiem Cashflow an und erwartet, dass das ARR zwischen $629,0 und $635,0 Millionen und der freie Cashflow zwischen $80,0 und $85,0 Millionen für 2024 erzielen wird. Zudem wurden die Erwartungen an das SaaS ARR auf 48% für das gesamte Jahr angehoben, was eine starke Akzeptanz seiner SaaS-Angebote demonstriert.
- Annual recurring revenues (ARR) grew 18% year-over-year to $584.2 million
- SaaS ARR reached 36% of total ARR, showing strong adoption of SaaS platform
- Total revenues increased to $130.3 million, up from $115.4 million in Q2 2023
- Year-to-date cash from operations improved to $68.4 million from $42.6 million last year
- Free cash flow increased to $67.3 million from $40.0 million in the previous year
- Raised full-year ARR guidance to $629.0-$635.0 million, representing 16-17% growth
- Increased free cash flow guidance to $80.0-$85.0 million for 2024
- GAAP operating loss of $28.8 million, though improved from $39.7 million loss in Q2 2023
- Term license subscription revenues decreased to $62.7 million from $85.4 million in Q2 2023
- Maintenance and services revenues slightly declined to $22.8 million from $24.3 million in Q2 2023
Insights
Varonis Systems' Q2 2024 results showcase a compelling shift towards SaaS and robust financial performance. The 18% year-over-year growth in ARR to
The financial health of Varonis is further emphasized by the substantial increase in cash generation. Year-to-date cash from operations surged to
While GAAP operating loss persists at
Investors should monitor the pace of SaaS transition, as it may impact short-term revenue recognition but could lead to more predictable, recurring revenue streams in the long run. The projected increase in SaaS ARR to
Varonis' Q2 results highlight its strategic pivot towards cloud-based solutions and managed services. The introduction of the Managed Data Detection and Response offering is a savvy move, addressing the growing demand for automated, low-effort data breach prevention solutions in an increasingly complex cybersecurity landscape.
The company's innovation in AWS data security with industry-first automated remediation capabilities positions Varonis at the forefront of cloud security. This development is important as organizations rapidly migrate to cloud environments, facing new and evolving security challenges.
Varonis' expansion of its Microsoft 365 Copilot security offering to include AI prompt monitoring is particularly noteworthy. As AI tools like Copilot become more prevalent in enterprise environments, the ability to prevent malicious AI activity will be a critical differentiator in the cybersecurity market.
The "In Process" designation with FedRAMP is a significant step towards capturing government contracts, potentially opening up a lucrative market segment for Varonis. This certification process, known for its rigorous standards, also serves as a strong endorsement of Varonis' security capabilities for private sector clients.
Varonis' recognition in the 2024 Gartner Peer Insights Voice of the Customer DSPM Report as a Customers' Choice further validates its market position and customer satisfaction levels. This accolade can be a powerful tool for attracting new customers in the competitive cybersecurity space.
Annual recurring revenues grew
SaaS ARR as a percentage of total ARR was approximately
Year-to-date cash from operations generated
Year-to-date free cash flow generated
NEW YORK, July 29, 2024 (GLOBE NEWSWIRE) -- Varonis Systems, Inc. (Nasdaq: VRNS), a leader in data security, today announced financial results for the second quarter ended June 30, 2024.
Yaki Faitelson, Varonis CEO, said, "Our second quarter results reflect the growing momentum of our SaaS platform and recently introduced Managed Data Detection and Response offering, which helps customers automatically prevent data breaches with very little effort.”
Guy Melamed, Varonis CFO & COO, added, “The strong adoption of our SaaS platform resulted in
Financial Summary for the Second Quarter Ended June 30, 2024
- Total revenues were
$130.3 million , compared with$115.4 million in the second quarter of 2023. - SaaS revenues were
$44.8 million , compared with$5.7 million in the second quarter of 2023. - Term license subscription revenues were
$62.7 million , compared with$85.4 million in the second quarter of 2023. - Maintenance and services revenues were
$22.8 million , compared with$24.3 million in the second quarter of 2023. - GAAP operating loss was (
$28.8) million , compared to GAAP operating loss of ($39.7) million in the second quarter of 2023. - Non-GAAP operating income was
$2.1 million , compared to non-GAAP operating income of$0.9 million in the second quarter of 2023.
The tables at the end of this press release include a reconciliation of GAAP operating income (loss) to non-GAAP operating income (loss) and GAAP net income (loss) to non-GAAP net income (loss) for the three and six months ended June 30, 2024 and 2023. An explanation of these measures is included below under the heading "Non-GAAP Financial Measures and Key Performance Indicators."
Key Performance Indicators and Recent Business Highlights
- Annual recurring revenues, or ARR, was
$584.2 million as of the end of the second quarter, up18% year-over-year. - As of June 30, 2024, the Company had
$790.3 million in cash and cash equivalents, short-term deposits and marketable securities. - During the six months ended June 30, 2024, the Company generated
$68.4 million of cash from operations, compared to$42.6 million generated in the prior year period. - During the six months ended June 30, 2024, the Company generated
$67.3 million of free cash flow, compared to$40.0 million generated in the prior year period. - Secured the "In Process" designation with the Federal Risk and Authorization Management Program (FedRAMP).
- Announced industry-first automated remediation to strengthen data security posture and prevent data breaches in AWS.
- Expanded Microsoft 365 Copilot security offering to include AI prompt monitoring to prevent malicious Copilot activity.
- Recognized as a Customers' Choice in 2024 Gartner Peer Insights Voice of the Customer DSPM Report.
An explanation of ARR is included below under the heading "Non-GAAP Financial Measures and Key Performance Indicators." In addition, the tables at the end of this press release include a reconciliation of net cash provided by operating activities to non-GAAP free cash flow. An explanation of this measure is also included below under the heading "Non-GAAP Financial Measures and Key Performance Indicators."
Financial Outlook
For the third quarter of 2024, the Company expects:
- Revenues of
$140.0 million to$143.0 million , or year-over-year growth of14% to17% . - Non-GAAP operating income of
$7.0 million to$8.0 million . - Non-GAAP net income per diluted share in the range of
$0.07 t o$0.08 , based on 128.2 million diluted shares outstanding.
For full year 2024, the Company now expects:
- ARR of
$629.0 million to$635.0 million , or year-over-year growth of16% to17% . - Free cash flow of
$80.0 million to$85.0 million . - Revenues of
$544.0 million to$552.0 million , or year-over-year growth of9% to11% . - Non-GAAP operating income of
$18.0 million to$21.0 million . - Non-GAAP net income per diluted share in the range of
$0.22 t o$0.24 , based on 128.1 million diluted shares outstanding.
Actual results may differ materially from the Company’s Financial Outlook as a result of, among other things, the factors described below under “Forward-Looking Statements”.
Conference Call and Webcast
Varonis will host a conference call today, Monday, July 29, 2024, at 4:30 p.m. Eastern Time, to discuss the Company's second quarter 2024 financial results. To access this call, dial 877-425-9470 (domestic) or 201-389-0878 (international). The passcode is 13747734. A replay of this conference call will be available through August 5, 2024 at 844-512-2921 (domestic) or 412-317-6671 (international). The replay passcode is 13747734. A live webcast of this conference call will be available on the "Investors" page of the Company's website (www.varonis.com), and a replay will be archived on the website as well.
Non-GAAP Financial Measures and Key Performance Indicators
Varonis believes that the use of non-GAAP operating income (loss) and non-GAAP net income (loss) is helpful to our investors. These measures, which the Company refers to as our non-GAAP financial measures, are not prepared in accordance with GAAP.
Non-GAAP operating income (loss) is calculated as operating income (loss) excluding (i) stock-based compensation expense, (ii) payroll tax expense related to stock-based compensation, and (iii) amortization of acquired intangible assets and acquisition-related expenses.
Non-GAAP net income (loss) is calculated as net income (loss) excluding (i) stock-based compensation expense, (ii) payroll tax expense related to stock-based compensation, (iii) amortization of acquired intangible assets and acquisition-related expenses, (iv) foreign exchange gains (losses) which include exchange rate differences on lease contracts as a result of the implementation of ASC 842 and (v) amortization of debt issuance costs.
The Company believes that the exclusion of these expenses provides a more meaningful comparison of our operational performance from period to period and offers investors and management greater visibility to the underlying performance of our business. Specifically:
- Stock-based compensation expenses utilize varying available valuation methodologies, subjective assumptions and a variety of equity instruments that can impact a company's non-cash expenses;
- Payroll taxes are tied to the exercise or vesting of underlying equity awards and the price of our common stock at the time of vesting or exercise, factors which may vary from period to period;
- Acquired intangible assets are valued at the time of acquisition and are amortized over an estimated useful life after the acquisition, and acquisition-related expenses are unrelated to current operations and neither are comparable to the prior period nor predictive of future results;
- The Company incurs foreign exchange gains or losses from the revaluation of its significant operating lease liabilities in foreign currencies as well as other assets and liabilities denominated in non-U.S. dollars, which may vary from period to period; and
- Amortization of debt issuance costs, which relate to the Company’s convertible senior notes issued in 2020, is a non-cash item.
Free cash flow is calculated as net cash provided by or used in operating activities less purchases of property and equipment. We believe that free cash flow is a useful indicator of liquidity that provides information to management and investors about the amount of cash provided by or used in our operations that, after the investments in property and equipment, can be used for strategic initiatives.
Each of our non-GAAP financial measures is an important tool for financial and operational decision making and for evaluating our own operating results over different periods of time. The non-GAAP financial measures do not represent our financial performance under U.S. GAAP and should not be considered as alternatives to operating income (loss) or net income (loss) or any other performance measures derived in accordance with GAAP. Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, and exclude expenses that may have a material impact on our reported financial results. Further, stock-based compensation expense and payroll tax expense related to stock-based compensation have been, and will continue to be for the foreseeable future, significant recurring expenses in our business and an important part of the compensation provided to our employees. Also, the amortization of intangible assets are expected recurring expenses over the estimated useful life of the underlying intangible asset and acquisition-related expenses will be incurred to the extent acquisitions are made in the future. Additionally, foreign exchange rates may fluctuate from one period to another, and the Company does not estimate movements in foreign currencies. Finally, the amortization of debt issuance costs are expected recurring expenses until the maturity of the senior notes in 2025.
The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Varonis urges investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not to rely on any single financial measures to evaluate our business.
A reconciliation for non-GAAP operating income (loss) and non-GAAP net income (loss) referred to in our “Financial Outlook” is not provided because, as forward-looking statements, such reconciliation is not available without unreasonable effort due to the high variability, complexity, and difficulty of estimating certain items such as charges to stock-based compensation expense and currency fluctuations which could have an impact on our consolidated results. The Company believes the information provided is useful to investors because it can be considered in the context of the Company’s historical disclosures of this measure.
ARR is a key performance indicator defined as the annualized value of active term-based subscription license contracts, SaaS contracts, and maintenance contracts in effect at the end of that period. Subscription license contracts, SaaS contracts, and maintenance contracts are annualized by dividing the total contract value by the number of days in the term and multiplying the result by 365. The annualized value of contracts is a legal and contractual determination made by assessing the contractual terms with our customers. The annualized value of maintenance contracts is not determined by reference to historical revenues, deferred revenues or any other GAAP financial measure over any period. ARR is not a forecast of future revenues, which can be impacted by contract start and end dates and renewal rates.
Forward-Looking Statements
This press release contains, and statements made during the above referenced conference call will contain, "forward-looking" statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including regarding the Company's growth rate and its expectations regarding future revenues, operating income or loss or earnings or loss per share. These statements are not guarantees of future performance but are based on management's expectations as of the date of this press release and assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements. Important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include the following: the impact of potential information technology, cybersecurity or data security breaches; risks associated with anticipated growth in Varonis’ addressable market; general economic and industry conditions, such as foreign currency exchange rate fluctuations and expenditure trends for data and cybersecurity solutions; Varonis’ ability to predict the timing and rate of subscription renewals and their impact on the Company’s future revenues and operating results; risks associated with international operations; the impact of global conflicts on the budgets of our clients and on economic conditions generally; competitive factors, including increased sales cycle time, changes in the competitive environment, pricing changes and increased competition; the risk that Varonis may not be able to attract or retain employees, including sales personnel and engineers; Varonis’ ability to build and expand its direct sales efforts and reseller distribution channels; risks associated with the closing of large transactions, including Varonis’ ability to close large transactions consistently on a quarterly basis; new product introductions and Varonis’ ability to develop and deliver innovative products; Varonis’ ability to provide high-quality service and support offerings; the expansion of cloud-delivered services; and risks associated with our convertible notes and capped-call transaction. These and other important risk factors are described more fully in Varonis’ reports and other documents filed with the Securities and Exchange Commission and could cause actual results to vary from expectations. All information provided in this press release and in the conference call is as of the date hereof, and Varonis undertakes no duty to update or revise this information, whether as a result of new information, new developments or otherwise, except as required by law.
About Varonis
Varonis (Nasdaq: VRNS) is a leader in data security, fighting a different battle than conventional cybersecurity companies. Our cloud-native Data Security Platform continuously discovers and classifies critical data, removes exposures, and detects advanced threats with AI-powered automation.
Thousands of organizations worldwide trust Varonis to defend their data wherever it lives — across SaaS, IaaS, and hybrid cloud environments. Customers use Varonis to automate a wide range of security outcomes, including data security posture management (DSPM), data classification, data access governance (DAG), data detection and response (DDR), data loss prevention (DLP), and insider risk management.
Varonis protects data first, not last. Learn more at www.varonis.com.
Investor Relations Contact:
Tim Perz
Varonis Systems, Inc.
646-640-2112
investors@varonis.com
News Media Contact:
Rachel Hunt
Varonis Systems, Inc.
877-292-8767 (ext. 1598)
pr@varonis.com
| Varonis Systems, Inc. | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (in thousands, except for share and per share data) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Unaudited | Unaudited | ||||||||||||||
| Revenues: | |||||||||||||||
| Term license subscriptions | $ | 62,729 | $ | 85,437 | $ | 118,709 | $ | 166,343 | |||||||
| SaaS | 44,785 | 5,653 | 78,770 | 7,721 | |||||||||||
| Maintenance and services | 22,832 | 24,328 | 46,889 | 48,689 | |||||||||||
| Total revenues | 130,346 | 115,418 | 244,368 | 222,753 | |||||||||||
| Cost of revenues | 22,436 | 17,386 | 43,785 | 35,023 | |||||||||||
| Gross profit | 107,910 | 98,032 | 200,583 | 187,730 | |||||||||||
| Operating expenses: | |||||||||||||||
| Research and development | 44,933 | 46,144 | 92,760 | 90,876 | |||||||||||
| Sales and marketing | 70,041 | 70,321 | 141,268 | 138,714 | |||||||||||
| General and administrative | 21,762 | 21,283 | 43,014 | 40,972 | |||||||||||
| Total operating expenses | 136,736 | 137,748 | 277,042 | 270,562 | |||||||||||
| Operating loss | (28,826 | ) | (39,716 | ) | (76,459 | ) | (82,832 | ) | |||||||
| Financial income, net | 8,249 | 8,465 | 16,794 | 16,238 | |||||||||||
| Loss before income taxes | (20,577 | ) | (31,251 | ) | (59,665 | ) | (66,594 | ) | |||||||
| Income taxes | (3,371 | ) | (7,446 | ) | (4,773 | ) | (10,407 | ) | |||||||
| Net loss | $ | (23,948 | ) | $ | (38,697 | ) | $ | (64,438 | ) | $ | (77,001 | ) | |||
| Net loss per share of common stock, basic and diluted | $ | (0.21 | ) | $ | (0.35 | ) | $ | (0.58 | ) | $ | (0.71 | ) | |||
| Weighted average number of shares used in computing net loss per share of common stock, basic and diluted | 111,885,305 | 109,740,289 | 110,934,149 | 109,063,722 | |||||||||||
| Stock-based compensation expense for the three and six months ended June 30, 2024 and 2023 is included in the Condensed Consolidated Statements of Operations as follows (in thousands): | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Unaudited | Unaudited | ||||||||||||||
| Cost of revenues | $ | 1,298 | $ | 2,030 | $ | 2,660 | $ | 4,530 | |||||||
| Research and development | 8,856 | 13,634 | 20,615 | 26,157 | |||||||||||
| Sales and marketing | 10,655 | 13,898 | 21,125 | 26,660 | |||||||||||
| General and administrative | 9,280 | 9,822 | 17,782 | 17,848 | |||||||||||
| $ | 30,089 | $ | 39,384 | $ | 62,182 | $ | 75,195 | ||||||||
| Payroll tax expense related to stock-based compensation for the three and six months ended June 30, 2024 and 2023 is included in the Condensed Consolidated Statements of Operations as follows (in thousands): | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Unaudited | Unaudited | ||||||||||||||
| Cost of revenues | $ | 9 | $ | 75 | $ | 616 | $ | 361 | |||||||
| Research and development | 66 | 50 | 379 | 157 | |||||||||||
| Sales and marketing | 46 | 277 | 2,900 | 1,698 | |||||||||||
| General and administrative | 303 | 51 | 1,116 | 468 | |||||||||||
| $ | 424 | $ | 453 | $ | 5,011 | $ | 2,684 | ||||||||
| Amortization of acquired intangibles and acquisition-related expenses for the three and six months ended June 30, 2024 and 2023 is included in the Condensed Consolidated Statements of Operations as follows (in thousands): | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Unaudited | Unaudited | ||||||||||||||
| Cost of revenues | $ | 381 | $ | 381 | $ | 762 | $ | 762 | |||||||
| Research and development | — | 411 | — | 823 | |||||||||||
| Sales and marketing | — | — | — | — | |||||||||||
| General and administrative | — | — | — | — | |||||||||||
| $ | 381 | $ | 792 | $ | 762 | $ | 1,585 | ||||||||
| Varonis Systems, Inc. | |||||||
| Condensed Consolidated Balance Sheets | |||||||
| (in thousands) | |||||||
| June 30, 2024 | December 31, 2023 | ||||||
| Unaudited | |||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 155,403 | $ | 230,740 | |||
| Marketable securities | 427,065 | 253,175 | |||||
| Short-term deposits | 44,846 | 49,800 | |||||
| Trade receivables, net | 122,412 | 169,116 | |||||
| Prepaid expenses and other current assets | 66,418 | 64,326 | |||||
| Total current assets | 816,144 | 767,157 | |||||
| Long-term assets: | |||||||
| Long-term marketable securities | 162,972 | 211,063 | |||||
| Operating lease right-of-use assets | 47,209 | 51,838 | |||||
| Property and equipment, net | 30,075 | 33,964 | |||||
| Intangible assets, net | 500 | 1,263 | |||||
| Goodwill | 23,135 | 23,135 | |||||
| Other assets | 14,780 | 15,490 | |||||
| Total long-term assets | 278,671 | 336,753 | |||||
| Total assets | $ | 1,094,815 | $ | 1,103,910 | |||
| Liabilities and stockholders’ equity | |||||||
| Current liabilities: | |||||||
| Trade payables | $ | 2,532 | $ | 672 | |||
| Accrued expenses and other short-term liabilities | 123,014 | 125,057 | |||||
| Deferred revenues | 208,907 | 181,049 | |||||
| Total current liabilities | 334,453 | 306,778 | |||||
| Long-term liabilities: | |||||||
| Convertible senior notes, net | 251,239 | 250,477 | |||||
| Operating lease liabilities | 45,414 | 51,313 | |||||
| Deferred revenues | 22 | 886 | |||||
| Other liabilities | 5,081 | 4,808 | |||||
| Total long-term liabilities | 301,756 | 307,484 | |||||
| Stockholders’ equity: | |||||||
| Share capital | |||||||
| Common stock | 112 | 109 | |||||
| Accumulated other comprehensive loss | (10,625 | ) | (8,649 | ) | |||
| Additional paid-in capital | 1,177,947 | 1,142,578 | |||||
| Accumulated deficit | (708,828 | ) | (644,390 | ) | |||
| Total stockholders’ equity | 458,606 | 489,648 | |||||
| Total liabilities and stockholders’ equity | $ | 1,094,815 | $ | 1,103,910 | |||
| Varonis Systems, Inc. | |||||||
| Condensed Consolidated Statements of Cash Flows | |||||||
| (in thousands) | |||||||
| Six Months Ended June 30, | |||||||
| 2024 | 2023 | ||||||
| Unaudited | |||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (64,438 | ) | $ | (77,001 | ) | |
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
| Depreciation and amortization | 5,767 | 5,807 | |||||
| Stock-based compensation | 62,182 | 75,196 | |||||
| Amortization of deferred commissions | 14,498 | 12,524 | |||||
| Non-cash operating lease costs | 4,722 | 4,731 | |||||
| Amortization of debt issuance costs | 768 | 754 | |||||
| Amortization of premium and accretion of discount on marketable securities | (7,611 | ) | (2,724 | ) | |||
| Changes in assets and liabilities: | |||||||
| Trade receivables | 46,704 | 32,311 | |||||
| Prepaid expenses and other current assets | (3,399 | ) | (10,065 | ) | |||
| Deferred commissions | (15,297 | ) | (12,423 | ) | |||
| Other long-term assets | (58 | ) | (447 | ) | |||
| Trade payables | 1,860 | (2,282 | ) | ||||
| Accrued expenses and other short-term liabilities | (4,374 | ) | (5,799 | ) | |||
| Deferred revenues | 26,995 | 19,322 | |||||
| Other long-term liabilities | 128 | 2,732 | |||||
| Net cash provided by operating activities | 68,447 | 42,636 | |||||
| Cash flows from investing activities: | |||||||
| Proceeds from sales and maturities of marketable securities | 45,101 | 20,850 | |||||
| Investment in marketable securities | (166,099 | ) | (59,698 | ) | |||
| Proceeds from short-term and long-term deposits | 14,338 | 162,012 | |||||
| Investment in short-term and long-term deposits | (9,192 | ) | (110,652 | ) | |||
| Purchases of property and equipment | (1,116 | ) | (2,603 | ) | |||
| Net cash provided by (used in) investing activities | (116,968 | ) | 9,909 | ||||
| Cash flows from financing activities: | |||||||
| Proceeds from employee stock plans | 9,792 | 5,889 | |||||
| Taxes paid related to net share settlement of equity awards | (36,608 | ) | (19,439 | ) | |||
| Repurchase of common stock | — | (7,599 | ) | ||||
| Net cash used in financing activities | (26,816 | ) | (21,149 | ) | |||
| Increase (decrease) in cash and cash equivalents | (75,337 | ) | 31,396 | ||||
| Cash and cash equivalents at beginning of period | 230,740 | 367,800 | |||||
| Cash and cash equivalents at end of period | $ | 155,403 | $ | 399,196 | |||
| Varonis Systems, Inc. | |||||||||||||||
| Reconciliation of GAAP Measures to non-GAAP | |||||||||||||||
| (in thousands, except share and per share data) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Unaudited | Unaudited | ||||||||||||||
| Reconciliation to non-GAAP operating income (loss): | |||||||||||||||
| GAAP operating loss | $ | (28,826 | ) | $ | (39,716 | ) | $ | (76,459 | ) | $ | (82,832 | ) | |||
| Add back: | |||||||||||||||
| Stock-based compensation expense | 30,089 | 39,384 | 62,182 | 75,195 | |||||||||||
| Payroll tax expenses related to stock-based compensation | 424 | 453 | 5,011 | 2,684 | |||||||||||
| Amortization of acquired intangible assets and acquisition-related expenses | 381 | 792 | 762 | 1,585 | |||||||||||
| Non-GAAP operating income (loss) | $ | 2,068 | $ | 913 | $ | (8,504 | ) | $ | (3,368 | ) | |||||
| Reconciliation to non-GAAP net income: | |||||||||||||||
| GAAP net loss | $ | (23,948 | ) | $ | (38,697 | ) | $ | (64,438 | ) | $ | (77,001 | ) | |||
| Add back: | |||||||||||||||
| Stock-based compensation expense | 30,089 | 39,384 | 62,182 | 75,195 | |||||||||||
| Payroll tax expenses related to stock-based compensation | 424 | 453 | 5,011 | 2,684 | |||||||||||
| Amortization of acquired intangible assets and acquisition-related expenses | 381 | 792 | 762 | 1,585 | |||||||||||
| Foreign exchange rate differences, net | (569 | ) | (1,220 | ) | (1,250 | ) | (2,204 | ) | |||||||
| Amortization of debt issuance costs | 385 | 378 | 768 | 754 | |||||||||||
| Non-GAAP net income | $ | 6,762 | $ | 1,090 | $ | 3,035 | $ | 1,013 | |||||||
| GAAP weighted average number of shares used in computing net loss per share of common stock - basic and diluted | 111,885,305 | 109,740,289 | 110,934,149 | 109,063,722 | |||||||||||
| Non-GAAP weighted average number of shares used in computing net income per share of common stock - basic | 111,885,305 | 109,740,289 | 110,934,149 | 109,063,722 | |||||||||||
| Non-GAAP weighted average number of shares used in computing net income per share of common stock - diluted | 128,023,643 | 127,294,881 | 128,045,793 | 126,753,984 | |||||||||||
| GAAP net loss per share of common stock - basic and diluted | $ | (0.21 | ) | $ | (0.35 | ) | $ | (0.58 | ) | $ | (0.71 | ) | |||
| Non-GAAP net income per share of common stock - basic | $ | 0.06 | $ | 0.01 | $ | 0.03 | $ | 0.01 | |||||||
| Non-GAAP net income per share of common stock - diluted | $ | 0.05 | $ | 0.01 | $ | 0.02 | $ | 0.01 | |||||||
| Varonis Systems, Inc. | |||||||
| Reconciliation of GAAP Measures to non-GAAP | |||||||
| (in millions) | |||||||
| Six Months Ended June 30, | |||||||
| 2024 | 2023 | ||||||
| Unaudited | |||||||
| Reconciliation to non-GAAP free cash flow: | |||||||
| Net cash provided by operating activities | $ | 68.4 | $ | 42.6 | |||
| Purchases of property and equipment | (1.1 | ) | (2.6 | ) | |||
| Free cash flow | $ | 67.3 | $ | 40.0 | |||
| Varonis Systems, Inc. | |||||||
| Reconciliation of GAAP Measures to non-GAAP | |||||||
| (in millions) | |||||||
| Twelve Months Ended December 31, 2024 | |||||||
| Low | High | ||||||
| Reconciliation to non-GAAP free cash flow: | |||||||
| Net cash provided by operating activities | $ | 85.0 | $ | 92.0 | |||
| Purchases of property and equipment | (5.0 | ) | (7.0 | ) | |||
| Free cash flow | $ | 80.0 | $ | 85.0 | |||
FAQ
What was Varonis' (VRNS) annual recurring revenue (ARR) growth in Q2 2024?
How much did Varonis (VRNS) generate in total revenues for Q2 2024?
What percentage of Varonis' (VRNS) total ARR came from SaaS in Q2 2024?
How much free cash flow did Varonis (VRNS) generate year-to-date in 2024?
What is Varonis' (VRNS) updated ARR guidance for full-year 2024?
