Proofpoint (PFPT) Q4 Earnings Surpass Estimates, Surge Y/Y
Zacks Investment Research | Feb 03, 2019 08:38PM ET
Proofpoint Inc. (NASDAQ:PFPT) delivered fourth-quarter 2018 non-GAAP earnings of 51 cents, which outpaced the Zacks Consensus Estimate of 35 cents and was also ahead of the year-ago quarterly figure of 37 cents.
Proofpoint reported total revenues of $198.5 million, up 35% year over year and also surpassed the Zacks Consensus Estimate of $193 million.
This strong top-line growth can be attributed to the sturdy international uptick and a solid progress in the emerging products. Moreover, Proofpoint drew $3 million of revenues (under ASC 606) from private cloud deployments in the fourth quarter, which was expected to be recognized in fiscal 2019. The company has, however, provided an outlook for fiscal 2019 that matched with the prior guidance.
Top-Line Details
Total billings during the quarter under review jumped 43% year over year to $269.9 million. Also, renewal rates again soared above 90% during the reported quarter. Management noted that with no improvement in Microsoft’s (NASDAQ:MSFT) overall efficacy in security during the fourth quarter, Proofpoint’s win rate is consistently high.
Subscription revenues (98.3% of total revenues) during the quarter under consideration came in at $195.1 million, up 35.1% from the year-ago period. Hardware and services revenues (1.7%) increased 17.2% year over year to $3.4 million.
On the basis of solutions, revenues from Advanced Threat (74.3%), which includes Targeted Attack Protection or TAP offering, rose 34.2% from the year-earlier quarter to $147.4 million, and Compliance revenues (25.7%) of $51.1 million surged 37.7% year over year.
Management mentioned that the new offerings have expanded the total addressable market by more than $5 billion and are proving to be a key growth catalyst. Emerging products, which contributed to more than 30% of total new and add-on businesses closed during the quarter under discussion, steadily surpass the company’s remaining product portfolio. This upside was led by robust demand for Email Fraud Defense, Threat Response and Wombat.
Proofpoint continues to expand abroad by dint of its international business performance, which grew 45% year over year and accounted for 19% of its total revenues.
Operating Details
Non-GAAP gross profit advanced 36.9% from the year-ago quarter to $156.6 million. Non-GAAP gross margin improved 100 basis points (bps) year over year to 78.9%, driven by a strong revenue performance.
Proofpoint’s non-GAAP operating income for the reported quarter augmented 39.5% to $29.3 million. Non-GAAP operating margin expanded 50 bps to 14.8%.
Proofpoint, Inc. Price, Consensus and EPS Surprise
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