Jive Software
May 8, 2012

Jive Software Announces First Quarter 2012 Financial Results

PALO ALTO, Calif., May 8, 2012 (GLOBE NEWSWIRE) -- Jive Software, Inc. (Nasdaq:JIVE), today announced financial results for its first quarter ended March 31, 2012.

"The first quarter was a strong start to 2012, highlighted by revenue and profitability that outperformed our guidance," stated Tony Zingale, Chairman & CEO of Jive. Zingale added, "The social business market is nearing its tipping point, and we are poised to take full advantage of this shift. With the recent announcement of Jive's next generation social business platform and Try Jive, the 30-day free trial of that platform, we are extending our multi-year technology lead and continuing to establish Jive as the clear choice for social business solutions among the world's most successful organizations."

First Quarter 2012 Financial Highlights

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."

First Quarter and Recent Business Highlights

Jive has recently accomplished the following business highlights:

  • Try Jive, a new group collaboration solution for teams of 25 to 250,000 people. Try Jive provides a fast and easy on-ramp to Jive's next generation platform via a Jive Cloud deployment and a 30-day free trial, bringing leading-edge social business capabilities to large and small teams.
  • Jive Anywhere, a breakthrough feature that provides one-click access to the Jive platform from any website or web application creating a ubiquitous social business experience.
  • Jive !App Experiences, an industry first innovation that enables users to interact with applications from within Jive and merge them seamlessly into the social business workflow with a single keystroke.
  • Jive Edge, a sophisticated social intelligence engine that leverages the power of big data and the enterprise social graph to provide predictive and personalized search results.
  • Enhancements to Jive What Matters activity streams, including customizable Attention Streams focused on specific processes and people.

Financial Outlook

As of May 8, 2012, Jive initiates guidance for its second quarter 2012, and issues improved guidance for the full year 2012, as follows:

With respect to the Company's expectations under "Financial Outlook" above, the Company has not reconciled non-GAAP loss from operations or non-GAAP loss per share to GAAP loss from operations and GAAP loss per share because the Company does not provide guidance for stock-based compensation, income taxes or amortization of intangible assets, which are reconciling items between those Non-GAAP and GAAP measures. As items that impact GAAP loss from operations and GAAP loss per share are out of the Company's control and/or cannot be reasonably predicted, the Company is unable to provide such guidance. Accordingly, a reconciliation to GAAP loss from operations and GAAP loss per share is not available without unreasonable effort.

Quarterly Conference Call

Jive will host a conference call today at 2:00 p.m. PT (5:00 p.m. ET) to review the Company's financial results for the first quarter 2012, in addition to discussing the Company's outlook for the second quarter 2012 and updated guidance for the full year 2012. To access this call, dial  (877) 723-9518 (domestic) or (719) 325-4879 (international) with conference ID #5696449. A live webcast of the conference call will be accessible from the Investor Relations section of Jive's website at http://investors.jivesoftware.com/ and a replay will be archived and accessible at: http://investors.jivesoftware.com/events.cfm. A replay of this conference call can also be accessed through May 22, 2012, by dialing (877) 870-5176 (domestic) or (858) 384-5517 (international). The replay passcode is 5696449.

About Jive Software

Jive Software (Nasdaq:JIVE) is a leading global Social Business company. We bring social technology innovations from the consumer world into enterprises securely and at scale, changing the way work gets done. Our platform combines the power of big data, enterprise integrations and social collaboration technologies. Millions of people at the world's largest companies are using Jive-powered communities internally and externally to transform their businesses.

Non-GAAP Financial Measures

The Company uses certain non-GAAP financial measures in this release. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. 

Non-GAAP gross profit, loss from operations, net loss and net loss per share exclude stock-based compensation expenses, non-recurring expenses related to acquisitions, amortization of acquisition related intangible assets, and changes in fair value of warrant liabilities. Total billings is defined by the Company as revenue plus the change in total deferred revenue. Management presents these non-GAAP financial measures because it considers them to be important supplemental measures of performance. Management uses the non-GAAP financial measures for planning purposes, including analysis of the Company's performance against prior periods, the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management also believes that the non-GAAP financial measures provide additional insight for analysts and investors in evaluating the Company's financial and operational performance. However, these non-GAAP financial measures have limitations as an analytical tool and are not intended to be an alternative to financial measures prepared in accordance with GAAP. We intend to provide these non-GAAP financial measures as part of our future earnings discussions and, therefore, the inclusion of these non-GAAP financial measures will provide consistency in our financial reporting. A reconciliation of these non-GAAP measures to GAAP is provided in the accompanying tables.

Safe Harbor Statement

"Safe Harbor" statement under Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements, including statements concerning our financial guidance for the second fiscal quarter of 2012 and the full year of 2012, the future growth of the social business software market, our position to execute on our growth strategy, and our ability to capitalize on our leadership position in the social business market. The achievement of success in the matters covered by such forward-looking statements involves substantial risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results or events could differ materially from the results expressed or implied by the forward-looking statements we make.

The risk and uncertainties referred to above include, but are not limited to, risks associated with our limited operating history; expectations regarding the widespread adoption of social business software by enterprises; uncertainty regarding the market for social business software; changes in the competitive dynamics of our market; our ability to increase and predict new subscription, subscription renewal or upsell rates and the impact these rates may have on our future revenues; our reliance on third-party service providers to host some of our products; the risk that our security measures could be breached and unauthorized access to customer data could be obtained; potential third party intellectual property infringement claims; and the price volatility of our common stock. 

More information about potential factors that could affect our business and financial results is contained in our prospectus as filed with the Securities and Exchange Commission. Additional information will also be set forth in our quarterly reports on Form 10-Q, annual reports on Form 10-K and other filings that we make with the Securities and Exchange Commission. We do not intend and undertake no duty to release publicly any updates or revisions to any forward-looking statements contained herein.

(In thousands, except per share data)
  Quarter Ended March 31, 
 Product  $ 21,671  $ 13,570
 Professional services  3,647  2,497
 Total revenues  25,318  16,067
Cost of revenues:    
 Product  6,822  3,929
 Professional services  3,789  3,131
 Total cost of revenues  10,611  7,060
Gross profit  14,707  9,007
Operating expenses:    
 Research and development   8,355  8,667
 Sales and marketing   11,356  8,838
 General and administrative  3,802  1,790
 Total operating expenses  23,513  19,295
Loss from operations  (8,806)  (10,288)
Other income (expense), net:    
 Interest income  14  15
 Interest expense  (88)  (98)
 Change in fair value of warrant liability  --   (4,051)
 Other, net  (45)  (37)
 Total other income (expense), net  (119)  (4,171)
Loss before provision for income taxes  (8,925)  (14,459)
Provision for income taxes  24  30
Net loss  $ (8,949)  $ (14,489)
Basic and diluted net loss per share   $ (0.15)  $ (0.63)
Shares used in basic and diluted per share calculations  61,446  23,002
(In thousands)
 March 31,
December 31,
Current assets:    
 Cash and cash equivalents  $ 143,749  $ 180,649
 Short-term marketable securities  22,112  -- 
 Accounts receivable, net  28,038  31,999
 Prepaid expenses and other current assets  4,113  4,503
 Total current assets  198,012  217,151
Marketable securities, noncurrent  12,239  -- 
Property and equipment, net   14,025  12,639
Goodwill  17,265  17,265
Intangible assets, net   10,252  11,141
Other assets   142  146
 Total assets  $ 251,935  $ 258,342
Liabilities and Stockholders' Equity  
Current liabilities:    
 Accounts payable  $ 5,399  $ 4,566
 Accrued payroll and related liabilities  4,304  6,629
 Other accrued liabilities  3,633  5,124
 Deferred revenue, current  66,481  62,329
 Term debt, current  2,946  2,946
 Total current liabilities  82,763  81,594
Deferred revenue, less current portion  14,229  15,497
Term debt, less current portion  9,442  10,192
Other long-term liabilities  341  340
 Total liabilities  106,775  107,623
Commitments and contingencies     
Stockholders' equity:    
 Common stock  7  7
 Less treasury stock at cost  (3,352)  (3,352)
 Additional paid-in capital  262,176  258,779
 Accumulated deficit  (113,674)  (104,725)
 Accumulated other comprehensive income  3  10
 Total stockholders' equity  145,160  150,719
 Total liabilities and stockholders' equity  $ 251,935  $ 258,342
(In thousands)
  Quarter Ended March 31, 
Cash flows from operating activities:    
Net loss  $ (8,949)  $ (14,489)
Adjustments to reconcile net loss to net cash provided by operating activities:
 Depreciation and amortization  2,218  1,847
 Stock-based compensation  3,085  1,056
 Change in fair value of warrant liability  --   4,051
 (Increase) decrease, net of acquisitions, in:    
 Accounts receivable, net  3,961  5,521
 Prepaid expenses and other assets  388  (266)
 Increase (decrease), net of acquisitions, in:    
 Accounts payable  1,634  2,115
 Accrued payroll and related liabilities  (2,325)  (887)
 Other accrued liabilities  (845)  (969)
 Deferred revenue  2,884  2,605
 Other long-term liabilities  1  27
 Net cash provided by operating activities  2,052  611
Cash flows from investing activities:    
 Payments for purchase of property and equipment  (3,401)  (3,486)
 Purchases of marketable securities  (34,351)  -- 
 Acquisitions, net of cash acquired  --   (500)
 Net cash used in investing activities  (37,752)  (3,986)
Cash flows from financing activities:    
 Proceeds from exercise of stock options   312  214
 Payments of initial public offering expenses  (766)  -- 
 Proceeds from revolving credit facility, net  --   515
 Proceeds from term loans  --   1,655
 Repayments of term loans  (750)  (354)
 Net cash provided by (used in) financing activities  (1,204)  2,030
Net decrease in cash and cash equivalents  (36,904)  (1,345)
Effect of exchange rate changes  4  -- 
Cash and cash equivalents, beginning of period  180,649  43,348
Cash and cash equivalents, end of period  $ 143,749  $ 42,003
(In thousands, except per share data)
  Quarter Ended March 31, 
Gross profit, as reported  $ 14,707  $ 9,007
Add back:    
 Stock-based compensation  258  69
 Amortization related to acquisitions  625  66
Gross profit, non-GAAP  $ 15,590  $ 9,142
Gross margin, non-GAAP 62% 57%
  Quarter Ended March 31, 
Research and development, as reported  $ 8,355  $ 8,667
 Stock-based compensation  947  353
 Amortization related to acquisitions  --   1,031
Research and development, non-GAAP  $ 7,408  $ 7,283
As percentage of total revenues, non-GAAP 29% 45%
  Quarter Ended March 31, 
Sales and marketing, as reported  $ 11,356  $ 8,838
 Stock-based compensation  526  309
Sales and marketing, non-GAAP  $ 10,830  $ 8,529
As percentage of total revenues, non-GAAP 43% 53%
  Quarter Ended March 31, 
General and administrative, as reported  $ 3,802  $ 1,790
 Stock-based compensation  1,354  325
General and administrative, non-GAAP  $ 2,448  $ 1,465
As percentage of total revenues, non-GAAP 10% 9%
  Quarter Ended March 31, 
Loss from operations, as reported  $ (8,806)  $ (10,288)
Add back:    
 Stock-based compensation  3,085  1,056
 Amortization related to acquisitions  625  1,097
Loss from operations, non-GAAP  $ (5,096)  $ (8,135)
  Quarter Ended March 31, 
Loss before provision for income taxes, as reported  $ (8,925)  $ (14,459)
Add back:    
 Stock-based compensation  3,085  1,056
 Amortization related to acquisitions  625  1,097
 Change in fair value of warrant liability  --   4,051
Loss before provision for income taxes, non-GAAP  $ (5,215)  $ (8,255)
  Quarter Ended March 31, 
Net loss, as reported  $ (8,949)  $ (14,489)
Add back:    
 Stock-based compensation  3,085  1,056
 Amortization related to acquisitions  625  1,097
 Change in fair value of warrant liability  --   4,051
Net loss, non-GAAP  $ (5,239)  $ (8,285)
  Quarter Ended March 31, 
Basic and diluted net loss per share, as reported  $ (0.15)  $ (0.63)
Add back:    
 Stock-based compensation  0.05  0.05
 Amortization related to acquisitions  0.01  0.05
 Change in fair value of warrant liability  0.00  0.18
Basic and diluted net loss per share, non-GAAP  $ (0.09)  $ (0.36)
  Quarter Ended March 31, 
Total revenues  $ 25,318  $ 16,067
Deferred revenue, end of period  80,710  52,628
Less: Deferred revenue, beginning of period  (77,826)  (50,195)
Billings  $ 28,202  $ 18,500
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