Marketo Announces Revenue Increase of 62% for Second Quarter 2013
SAN MATEO, Calif., July 30, 2013 /PRNewswire/ – Marketo (NASDAQ: MKTO), the provider of a leading cloud-based marketing software platform, today announced its second quarter 2013 financial results.
- Revenue increased 62% year over year to $22.5 million
- Customer count increased to 2,592
- Reported strong diversity in customer acquisition across CRM ecosystems, consumer brands, verticals, geographies, and SMB and enterprise sectors
- Successfully grew existing customer relationships globally
- Continued rapid innovation with the release of Marketo Financial Management and Marketo Customer Engagement Engine
“We are delighted to report outstanding revenue and customer growth in our first quarter as a public company,” commented Phil Fernandez, President and CEO of Marketo. “In the second quarter of 2013, we hit on all cylinders across the key elements of our growth strategy, and we’re very satisfied with the fundamentals of our business. Our success in the quarter continues to validate that customers in this big and fast growing category want to do business with an innovator that is solely focused on building the industry’s best marketing platform.”
Results for the second quarter of 2013:
- Revenue: Revenue was $22.5 million, an increase of 62% over the prior year period and an increase of 14% from the quarter ended March 31, 2013.
- Deferred Revenue: Deferred revenue as of June 30, 2013 was $30.6 million, up 81% year over year from $16.9 million at June 30, 2012, and up 25% from $24.5 million at March 31, 2013.
- Net Loss: GAAP net loss was $12.4 million, and net loss per common share, basic and diluted, was $(0.63). Non-GAAP net loss was $9.6 million, and net loss per common share, basic and diluted, was $(0.49), which excludes approximately $2.6 million in stock-based compensation expense and $125,000 of amortization of acquired intangible assets. GAAP and non-GAAP net loss per common share calculations are based on 19.8 million weighted average common shares outstanding.
- Total Cash and Cash Equivalents: As of June 30, 2013, total cash and cash equivalents was $121.9 million, which includes net proceeds received in the second quarter of $85.3 million in connection with our Initial Public Offering and concurrent private placement.
As of July 30, 2013, Marketo is initiating revenue and EPS guidance for its third quarter of 2013 and full year 2013.
For the third quarter of 2013, the Company expects to report:
- Revenue in the range of $23 to $24 million
- GAAP net loss per share in the range of $(0.29) to $(0.31) and non-GAAP net loss per share in the range of$(0.23) to $(0.26), excluding stock-based compensation expense of approximately $2.0 million and $125,000 of amortization of acquired intangible assets assuming approximately 37.0 million weighted average common shares outstanding
For the full year 2013, the Company expects to report:
- Revenue in the range of $89 to $91 million
- GAAP net loss per share in the range of $(1.71) to $(1.83) and non-GAAP net loss per share in the range of$(1.38) to $(1.50), excluding stock-based compensation expense of approximately $7.6 million and $500,000 of amortization of acquired intangible assets assuming approximately 24.6 million weighted average common shares outstanding
Conference Call Information
Marketo will host a conference call and live webcast to discuss the financial results at 2:00 p.m. Pacific Time, 5:00 p.m. Eastern Time, today, Tuesday, July 30, 2013. The conference call can be accessed by dialing 1-877-941-8416, or 1-480-629-9808 (outside the U.S. and Canada). A live webcast will be available on the Investor Relations page of the Marketo corporate website at www.marketo.com and via replay beginning approximately two hours after the completion of the call for 90 days. An audio replay of the call will also be available to all interested parties beginning at approximately 5:00 p.m. Pacific Time, 8:00 p.m. Eastern Time, on Tuesday, July 30, 2013 until 11:59 p.m. Pacific Time, 2:59 a.m. Eastern Time, on Tuesday, August 6, 2013, by dialing 1-800-406-7325 or 1-303-590-3030 (outside the U.S. and Canada) and entering pass code 4629830#.
Use of Non-GAAP Financial Information
Marketo provides financial statements that are prepared in accordance with generally accepted accounting principles (GAAP). To help understand Marketo’s past financial performance and future results, Marketo has supplemented its financial results that it provides in accordance with GAAP with non-GAAP financial measures. The method Marketo uses to produce non-GAAP financial results is not computed according to GAAP and may differ from the methods used by other companies. The non-GAAP measures used by Marketo in this press release exclude the impact of stock-based compensation expense and amortization of acquired intangible assets. 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 the company’s consolidated financial statements prepared in accordance with GAAP. Specifically, management is excluding the following items from its non-GAAP historic and estimated net loss and net loss per common share, basic and diluted:
- Stock-Based Compensation Expense: The company’s compensation strategy includes the use of stock-based compensation to attract and retain employees and executives. It is principally aimed at aligning their interests with those of our stockholders and at long-term employee retention, rather than to motivate or reward operational performance for any particular period. Thus, stock-based compensation expense varies for reasons that are generally unrelated to operational decisions and performance in any particular period.
- Amortization of Acquired Intangible Assets: The company views amortization of acquisition-related intangible assets, such as the amortization of the cost associated with an acquired company’s research and development efforts, trade names, customer lists and customer relationships, as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangibles is a static expense, one that is not typically affected by operations during any particular period.
“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements about expected GAAP and non-GAAP financial results for the third quarter and the full year of 2013, including revenue, EPS, stock-based compensation expense and amortization of acquired intangible assets. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements we make.
The risks and uncertainties referred to above include – but are not limited to – risks associated with: possible fluctuations in the company’s financial and operating results; the company’s rate of growth and anticipated revenue run rate, including the company’s ability to convert deferred revenue and unbilled deferred revenue into revenue and, as appropriate, cash flow, and the continued growth and ability to maintain deferred revenue and unbilled deferred revenue; errors, interruptions or delays in the company’s service or the company’s Web hosting; breaches of the company’s security measures; the financial impact of any previous and future acquisitions; the nature of the company’s business model; the company’s ability to continue to release, and gain customer acceptance of, new and improved versions of the company’s service; successful customer deployment and utilization of the company’s existing and future services; changes in the company’s sales cycle; competition; relationships with platform providers; various financial aspects of the company’s subscription model; unexpected increases in attrition or decreases in new business; the emerging markets in which the company operates; unique aspects of entering or expanding in international markets, the company’s ability to hire, retain and motivate employees and manage the company’s growth; changes in the company’s customer base; technological developments; regulatory developments; litigation related to intellectual property and other matters, and any related claims, negotiations and settlements; unanticipated changes in the company’s effective tax rate; fluctuations in the number of shares we have outstanding and the price of such shares; foreign currency exchange rates; collection of receivables; interest rates; factors affecting our deferred tax assets and ability to value and utilize them; the risks and expenses associated with the company’s real estate and office facilities space; and general developments in the economy, financial markets, and credit markets.
Further information on these and other factors that could affect the company’s financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time.
Marketo, Inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
About Marketo: Marketing Software. Easy, Powerful, Complete.
Marketo (NASDAQ: MKTO) provides the leading cloud-based marketing software platform for companies of all sizes to build and sustain engaging customer relationships. Spanning today’s digital, social, mobile and offline channels, the Marketo® solution includes a complete suite of applications that help organizations acquire new customers more efficiently, maximize customer loyalty and lifetime value, improve sales effectiveness, and provide analytical insight into marketing’s contribution to revenue growth. Marketo’s applications are known for their breakthrough ease-of-use, and are complemented by the Marketing Nation™, a thriving network of more than 150 LaunchPoint™ ecosystem partners and over 30,000 marketers who share and learn from each other to grow their collective marketing expertise. The result for modern marketers is unprecedented agility and superior results.
Headquartered in San Mateo, CA with offices in Europe and Australia, Marketo serves as a strategic marketing partner to more than 2,500 large enterprises and fast-growing small companies across a wide variety of industries. For more information, visit www.marketo.com.
Marketo, the Marketo logo, Marketing Nation and LaunchPoint are trademarks of Marketo, Inc. All other trademarks are the property of their respective owners.