Cornerstone OnDemand Announces First Quarter 2020 Financial Results
London — 11 May, 2020 — People development solution provider Cornerstone OnDemand, Inc. (NASDAQ: CSOD), a global leader in people development solutions, today announced results1 for its first quarter ended 31 March, 2020. The Company has provided supplemental financial information located on its Investor Relations website, including an accompanying featured presentation, at http://investors.cornerstoneondemand.com.
First Quarter 2020 Results:
Revenue for the first quarter of 2020 was $150.1 million compared to a guided range of $147.0 million to $150.0 million.This represents a 7.2% increase compared to the same period of the prior year. Revenue growth on a constant currency basis was 7.8%.
Subscription revenue for the first quarter of 2020 was $144.4 million compared to a guided range of $143.0 million to $145.0 million.This represents a 10.0% increase compared to the same period of the prior year. Subscription revenue growth on a constant currency basis was 10.7%.
Operating loss for the first quarter of 2020 was $2.7 million, yielding a margin of (1.8)%, compared to operating income of $1.2 million and margin of 0.9% in the same period of the prior year.
Non-GAAP operating income for the first quarter of 2020 was $24.9 million, yielding a margin of 16.6%, compared to $19.6 million and margin of 14.0% in the same period of the prior year.
Net loss for the first quarter of 2020 was $13.8 million, or $(0.22) diluted net income per share, compared to $3.5 million and $(0.06) diluted net loss per share in the same period of the prior year.
Non-GAAP net income for the first quarter of 2020 was $15.0 million, or a $0.23 diluted net income per share, compared to $15.9 million and $0.25 diluted net income per share in the same period of the prior year.
Unlevered free cash flow for the first quarter of 2020 was $6.3 million, yielding a margin of 4.2%, compared to $4.3 million, yielding a margin of 3.1%, in the same period of the prior year.
"Our combination with Saba is a significant milestone for Cornerstone and, more importantly, for our expanded community of clients around the world. With our shared passion for people development and our combined depth of expertise, we expect to accelerate product innovation and help tens of millions of people develop new skills to navigate the future,” said Adam Miller, founder and Chief Executive Officer of Cornerstone. "Although we are definitely not immune to the impact of COVID-19, we believe that our combined scale with approximately 7,000 customers and over 75 million users, along with the significant cash flow generation capabilities that our synergistic model provides, will enable us to drive meaningful shareholder value over time."
- In response to the Coronavirus pandemic, the Company created "Cornerstone Cares", a free public learning portal with playlists for COVID-19 Health and Safety, Stress Management, and Work From Home.
- On April 22, 2020, the Company finalised its acquisition of Saba Software, Inc., a global leader in talent experience solutions, for an aggregate purchase price of approximately $1.295 billion, consisting of $1.262 billion in cash and 1,110,352 shares of common stock of the Company.
“Our first quarter was progressing well until the COVD-19 pandemic headwinds began to slow new sales at the end of March. To offset the impact of these headwinds, we have been able to augment and accelerate the synergies from the Saba acquisition as our integration progresses ahead of plan. We now expect to realise $50 million in run-rate synergies as we exit 2020, as compared to our prior guidance of $35 million over twenty-four months,” said Brian Swartz, Cornerstone’s Chief Financial Officer. “We have also spent considerable time analysing our liquidity position under various scenarios given the current state of global economic uncertainty, and even under extreme scenarios, such as assuming no new sales through the end of 2021, we still expect to increase our cash balances through the end of 2021. This gives us a high level of confidence in our ability to weather this storm.”
1 Financial measures presented on a constant currency basis, non-GAAP operating income, non-GAAP operating income margin, non-GAAP net income, non-GAAP diluted net income per share, unlevered free cash flow, and unlevered free cash flow margin are non-GAAP financial measures. Please see the discussion in the section titled “Non-GAAP Financial Measures” and the reconciliations of each non-GAAP financial measure to its most comparable GAAP financial measure at the end of this press release.
Quarterly Conference Call
Cornerstone will host a conference call to discuss its first quarter 2020 results at 2:00 p.m. PT (5:00 p.m. ET) today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the Company’s Investor Relations website at http://investors.cornerstoneondemand.com. The live call can be accessed by dialing (877) 445-4619 (US) or (484) 653-6763 (outside the US) and referencing passcode: 4879143. A replay of the call will also be available at http://investors.cornerstoneondemand.com/investors/news-and-events/events/default.aspx or via telephone until 6:00 p.m. PT (9:00 p.m. ET) on May 14, 2020 by dialing (855) 859-2056 (US) or (404) 537-3406 (outside the US), and referencing passcode: 4879143.
An accompanying featured presentation will be available at https://investors.cornerstoneondemand.com/investors/overview/default.aspx.
Cornerstone is a premier people development company. We believe people can achieve anything when they have the right development and growth opportunities. We offer organisations the technology, content, expertise and specialised focus to help them realise the potential of their people. Featuring comprehensive recruiting, personalised learning, modern training content, development-driven performance management and holistic employee data management and insights, Cornerstone’s people development solutions are used by approximately 7,000 clients of all sizes, spanning more than 75 million users across over 180 countries and 50+ languages. Learn more at www.cornerstoneondemand.co.uk.
Phone: +44 (0)203 861 3603