SOURCE: Omniture

Omniture

October 15, 2009 08:00 ET

Omniture Reports Third Quarter 2009 Financial Results

OREM, UT--(Marketwire - October 15, 2009) - Omniture, Inc. (NASDAQ: OMTR), a leading provider of online business optimization software, today announced results for its third quarter ending September 30, 2009. In the third quarter of 2009, Omniture achieved revenue of $87.9 million, an increase of 13% compared to revenue of $77.8 million reported for the same period a year ago. Non-GAAP revenue for the quarter was $88.0 million. The difference between GAAP and non-GAAP revenue reflects the revenue excluded from the GAAP results due to purchase accounting adjustments, which reduces deferred revenue to its fair value.

Omniture's GAAP net loss was $8.5 million or $0.11 per diluted share in the third quarter of 2009, as compared to a net loss of $17.3 million or $0.24 per diluted share in the third quarter of 2008. GAAP net loss for the third quarter of 2009 includes approximately $5.3 million in acquisition-related expenses associated with Omniture's agreement to be acquired by Adobe Systems Incorporated. Non-GAAP net income was $12.3 million or $0.15 per diluted share for the third quarter 2009, compared to non-GAAP net income of $8.2 million or $0.11 per diluted share in the third quarter of 2008. Non-GAAP net income excludes the effect of acquisition-related adjustments to deferred revenue, stock-based compensation, amortization of certain intangible assets, imputed interest related to patent license agreements and certain acquisition-related expenses and non-cash tax adjustments.

Third quarter fiscal 2009 adjusted EBITDA was $20.4 million. Adjusted EBITDA is defined as loss from operations on a GAAP basis less depreciation and amortization, stock-based compensation, acquisition-related costs related to the agreement by Omniture to be acquired by Adobe Systems Incorporated and acquisition-related adjustments to deferred revenue. Omniture ended the quarter with total cash and investments of $145.3 million and generated cash flow from operations for the third quarter of fiscal 2009 of $19.1 million.

During the third quarter of 2009, Omniture captured data from nearly 1.1 trillion transactions and added more than 150 new customers. New customer relationships secured and announced in the third quarter include: Ashley Homestores LTD., AO Ventures dba Bigleads.com, Beyond.com, British Heart Foundation, ING Life Insurance Korea, Ltd., Mail.com Media Corporation, MSG Varsity Network LLC, Tesco Stores Limited, USO and Zagg, Inc.

Omniture will not be hosting a conference call in conjunction with these results. For more information or to access the financial results, please visit www.OMTR.com.

About Non-GAAP Financial Measures

In this release we use certain non-GAAP financial measures. 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 in the United States of America, or GAAP. A reconciliation between non-GAAP and GAAP measures can be found in the accompanying tables and on the "Investor Relations" section of our corporate Web site at www.omtr.com. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the same captions and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies.

We believe that, while these non-GAAP measures are not a substitute for GAAP results, they provide a basis for evaluating the company's operating results because they are helpful in understanding our past financial performance and our future results and facilitate comparisons of results between periods. We believe the calculation of non-GAAP revenue, which reflects the revenue excluded from the GAAP results due to purchase accounting adjustments to reduce deferred revenue to its fair value, provides a meaningful comparison to our historic GAAP revenue. We also believe the calculation of net income and loss, calculated without acquisition-related accounting adjustments to deferred revenue, stock-based compensation expense, the amortization of certain intangible assets, imputed interest expense and certain acquisition-related expenses and tax benefits, provides a meaningful comparison to our net loss figures. We also believe that adjusted EBITDA, which we calculate as loss from operations on a GAAP basis less depreciation and amortization, stock-based compensation, acquisition-related costs related to the agreement by Omniture to be acquired by Adobe Systems Incorporated and acquisition-related adjustments to deferred revenue, is an indicator of the company's financial results and cash flows and is useful to investors in evaluating operating performance. Our management regularly uses these non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures have been reconciled to the nearest GAAP measure as required under the rules and regulations promulgated by the U.S. Securities and Exchange Commission.

About Omniture

Omniture, Inc. is a leading provider of online business optimization software, enabling customers to manage and enhance online, offline and multi-channel business initiatives. Omniture's software, which it hosts and delivers to its customers as an on-demand subscription service and on-premise solution, enables customers to capture, store and analyze information generated by their Web sites and other sources and to gain critical business insights into the performance and efficiency of marketing and sales initiatives and other business processes. In addition, Omniture offers a range of professional services that complement its online services, including implementation, best practices, consulting, customer support and user training through Omniture Education. www.omniture.com

Copyright (c) 2009 Omniture, Inc. All rights reserved. Omniture is a registered trademark of Omniture, Inc. in the United States, Japan, Canada and the European Community. Omniture, Inc. owns other registered and unregistered trademarks throughout the world. Other names used herein may be trademarks of their respective owners.

                              Omniture, Inc.
              Condensed Consolidated Statements of Operations
                  (in thousands, except per share data)
                                (unaudited)


                    Three Months Ended    Three Months Ended   % Increase
                       September 30,         September 30,     (Decrease)
                   -------------------   -------------------   ----------
                                % of                  % of
                     2008     Revenues     2009     Revenues
                   ---------  --------   ---------  --------
Revenues:
  Subscription,
   license and
   maintenance     $  69,554        89%  $  77,558        88%          12%
  Professional
   services and
   other               8,227        11      10,294        12           25
                   ---------  --------   ---------  --------
    Total revenues    77,781       100      87,852       100           13

Cost of revenues
 (1):
  Subscription,
   license and
   maintenance        28,860        37      33,074        38           15
  Professional
   services and
   other               4,056         5       4,159         5            3
                   ---------  --------   ---------  --------
    Total cost of
     revenues         32,916        42      37,233        43           13
                   ---------  --------   ---------  --------
Gross profit          44,865        58      50,619        57           13
Operating
 expenses:
  Sales and
   marketing (1)      32,705        42      31,953        36           (2)
  Research and
   development (1)     9,190        12       8,884        10           (3)
  General and
   administrative
   (1)                11,364        15      12,057        14            6
  Acquisition
   related (2)             -         -       5,273         6          N/A
                   ---------  --------   ---------  --------
    Total operating
     expenses         53,259        69      58,167        66            9
                   ---------  --------   ---------  --------
Loss from
 operations           (8,394)      (11)     (7,548)       (9)         (10)
Interest income          368         1         127         -          (65)
Interest expense        (261)        -        (299)        -           15
Other (expense),
 net                    (585)       (1)       (425)       (1)         (27)
                   ---------  --------   ---------  --------
Loss before income
 taxes                (8,872)      (11)     (8,145)      (10)          (8)
Provision for
 income taxes          8,408        11         374         -          (96)
                   ---------  --------   ---------  --------
Net loss           $ (17,280)      (22)% $  (8,519)      (10)%        (51)%
                   =========  ========   =========  ========

Net loss per
 share:
  Net loss per
   share, basic
   and diluted     $   (0.24)            $   (0.11)                   (54)%
  Weighted-average
   number of
   shares, basic
   and diluted        72,202                77,012                      7%


Adjusted EBITDA
 (3)               $  16,247        21%  $  20,448        23%          26%


(1) Amounts
 include
 stock-based
 compensation
 expenses, as
 follows:
  Cost of
   subscription,
   license and
   maintenance
   revenues        $     865         1%  $     761         1%
  Cost of
   professional
   services and
   other revenues        243         0         216         0
  Sales and
   marketing           2,909         4       3,312         4
  Research and
   development         1,512         2       1,277         1
  General and
   administrative      2,272         3       1,725         2
                   ---------  --------   ---------  --------
    Total
     stock-based
     compensation
     expenses      $   7,801        10%  $   7,291         8%
                   =========  ========   =========  ========


(2) Acquisition-related costs consist of direct transaction costs related
    to the agreement by Omniture, Inc., to be acquired by Adobe Systems
    Incorporated

(3) Adjusted EBITDA is equal to the loss from operations less depreciation
    and amortization, stock-based compensation, acquisition-related costs
    and the acquisition-related adjustment to deferred revenue




                              Omniture, Inc.
              Condensed Consolidated Statements of Operations
                  (in thousands, except per share data)
                                (unaudited)


                     Nine Months Ended     Nine Months Ended   % Increase
                       September 30,         September 30,     (Decrease)
                   -------------------   -------------------   ----------
                                % of                  % of
                     2008     Revenues     2009     Revenues
                   ---------  --------   ---------  --------
Revenues:
  Subscription,
   license and
   maintenance     $ 191,324        90%  $ 231,898        88%          21%
  Professional
   services and
   other              21,290        10      30,683        12           44
                   ---------  --------   ---------  --------
    Total revenues   212,614       100     262,581       100           24

Cost of revenues
 (1):
  Subscription,
   license and
   maintenance        79,724        38      96,990        37           22
  Professional
   services and
   other              10,817         5      12,723         5           18
                   ---------  --------   ---------  --------
    Total cost of
     revenues         90,541        43     109,713        42           21
                   ---------  --------   ---------  --------
Gross profit         122,073        57     152,868        58           25
Operating
 expenses:
  Sales and
   marketing (1)      96,091        45     102,868        39            7
  Research and
   development (1)    27,840        13      27,010        10           (3)
  General and
   administrative
   (1)                33,993        16      35,464        14            4
  Acquisition
   related (2)             -         -       5,273         2          N/A
                   ---------  --------   ---------  --------
    Total
     operating
     expenses        157,924        74     170,615        65            8
                   ---------  --------   ---------  --------
Loss from
 operations          (35,851)      (17)    (17,747)       (7)         (50)
Interest income        1,659         1         319         -          (81)
Interest expense        (718)       (1)       (979)        -           36
Other (expense),
 net                    (541)        -      (1,678)       (1)         210
                   ---------  --------   ---------  --------
Loss before income
 taxes               (35,451)      (17)    (20,085)       (8)         (43)
Provision for
 income taxes          1,232         -       1,495         -           21
                   ---------  --------   ---------  --------
Net loss           $ (36,683)      (17)% $ (21,580)       (8)%        (41)%
                   =========  ========   =========  ========

Net loss per
 share:
  Net loss per
   share, basic
   and diluted     $   (0.52)            $   (0.28)                   (46)%
  Weighted-average
   number of
   shares, basic
   and diluted        71,034                76,116                      7%


Adjusted EBITDA
 (3)               $  42,145        20%  $  55,733        21%          32%


(1) Amounts
 include
 stock-based
 compensation
 expenses, as
 follows:
  Cost of
   subscription,
   license and
   maintenance
   revenues        $   3,357         2%  $   2,290         1%
  Cost of
   professional
   services and
   other revenues        734         0         628         0
  Sales and
   marketing           9,186         4       9,365         4
  Research and
   development         5,352         3       3,762         1
  General and
   administrative      6,474         3       5,705         2
                   ---------  --------   ---------  --------
    Total
     stock-based
     compensation
     expenses      $  25,103        12%  $  21,750         8%
                   =========  ========   =========  ========


(2) Acquisition-related costs consist of direct transaction costs related
    to the agreement by Omniture, Inc., to be acquired by Adobe Systems
    Incorporated

(3) Adjusted EBITDA is equal to the loss from operations less depreciation
    and amortization, stock-based compensation, acquisition-related costs
    and the acquisition-related adjustment to deferred revenue




                              Omniture, Inc.
                    Reconciliation of Non-GAAP Measures
                  (in thousands, except per share data)
                                (unaudited)


                                 Three Months Ended     Nine Months Ended
                                    September 30,         September 30,
                                --------------------  --------------------
                                  2008       2009       2008       2009
                                ---------  ---------  ---------  ---------

Reconciliation of Total
 Revenues on a GAAP Basis to
 Total Revenues on a Non-GAAP
 Basis:
Total revenues on a GAAP basis  $  77,781  $  87,852  $ 212,614  $ 262,581
  Acquisition-related
   adjustment to Touch
   Clarity deferred
    revenue (1)                         -          -        378          -
  Acquisition-related
   adjustment to Offermatica
   deferred revenue (1)                80          -        617          2
  Acquisition-related
   adjustment to Visual
   Sciences deferred
   revenue (1)                      1,820          -     10,558          -
  Acquisition-related
   adjustment to Mercado
   deferred revenue (1)                 -        171          -      1,130
                                ---------  ---------  ---------  ---------
Total revenues on a non-GAAP
 basis                          $  79,681  $  88,023  $ 224,167  $ 263,713
                                =========  =========  =========  =========


Reconciliation of Net Loss on a
 GAAP Basis to Net Income on a
 Non-GAAP Basis:
Net loss on a GAAP basis        $ (17,280) $  (8,519) $ (36,683) $ (21,580)
  Acquisition-related
   adjustment to deferred
   revenue (1)                      1,900        171     11,553      1,132
  Amortization of intangible
   assets (2)                       7,851      8,043     22,657     23,931
  Stock-based compensation          7,801      7,291     25,103     21,750
  Imputed interest on patent
   license obligation (3)              56         33        181        122
  Acquisition related (4)               -      5,273          -      5,273
  Non-cash tax benefit resulting
   from the reduction in
   acquisition-related
   deferred tax liabilities
   (5)                              7,904          -          -          -
                                ---------  ---------  ---------  ---------
Net income on a non-GAAP basis  $   8,232  $  12,292  $  22,811  $  30,628
                                =========  =========  =========  =========


Reconciliation of Diluted Net
 Loss per Share on a GAAP Basis
 to Diluted Net Income per
 Share on a Non-GAAP Basis:
Diluted net loss per share on
 a GAAP basis                   $   (0.24) $   (0.11) $   (0.52) $   (0.28)
  Acquisition-related
   adjustment to deferred
   revenue (1)                       0.03          -       0.17       0.01
  Amortization of intangible
   assets (2)                        0.11       0.10       0.32       0.31
  Stock-based compensation           0.11       0.10       0.35       0.29
  Imputed interest on patent
   license obligation (3)               -          -          -          -
  Acquisition related (4)               -       0.07          -       0.07
  Non-cash tax benefit resulting
   from the reduction in
   acquisition-related
   deferred tax liabilities
   (5)                               0.11          -          -          -
  Impact of difference in number
   of GAAP and non-GAAP diluted
   shares                           (0.01)     (0.01)     (0.02)     (0.01)
                                ---------  ---------  ---------  ---------
Diluted net income per share
 on a non-GAAP basis            $    0.11  $    0.15  $    0.30  $    0.39
                                =========  =========  =========  =========


Reconciliation of Net Loss on a
 GAAP Basis to Adjusted EBITDA:
Net loss on a GAAP basis        $ (17,280) $  (8,519) $ (36,683) $ (21,580)
  Other (income) expense, net         478        597       (400)     2,338
  Provision for income taxes        8,408        374      1,232      1,495
                                ---------  ---------  ---------  ---------
Loss from operations on a GAAP
 basis                             (8,394)    (7,548)   (35,851)   (17,747)
  Depreciation and amortization    14,940     15,261     41,340     45,325
  Stock-based compensation          7,801      7,291     25,103     21,750
  Acquisition related (4)               -      5,273          -      5,273
  Acquisition-related adjustment
   to deferred revenue (1)          1,900        171     11,553      1,132
                                ---------  ---------  ---------  ---------
Adjusted EBITDA                 $  16,247  $  20,448  $  42,145  $  55,733
                                =========  =========  =========  =========


(1) This item is recorded in subscription, license and maintenance revenue
    in the Condensed Consolidated Statements of Operations

(2) Amortization of intangible assets is allocated as follows in the
    Condensed Consolidated Statement of Operations:

                                 Three Months Ended     Nine Months Ended
                                    September 30,         September 30,
                                --------------------  --------------------
                                   2008       2009       2008       2009
                                ---------  ---------  ---------  ---------
  Cost of subscription, license
   and maintenance revenues     $   4,778  $   5,022  $  13,830  $  14,970
  Sales and marketing               2,985      3,021      8,562      8,934
  General and administrative           88          -        265         27
                                ---------  ---------  ---------  ---------
     Total amortization of
      intangible assets         $   7,851  $   8,043  $  22,657  $  23,931
                                =========  =========  =========  =========

(3) This item is recorded in interest expense in the Condensed Consolidated
    Statements of Operations

(4) Acquisition-related costs consist of direct transaction costs related
    to the agreement by Omniture, Inc., to be acquired by Adobe Systems
    Incorporated

(5) This item is recorded in (benefit from) provision for income taxes in
    the Condensed Consolidated Statements of Operations




                              Omniture, Inc.
                            Additional Metrics
                                (unaudited)



                        March    June   September  December   March   June
                          31,     30,      30,        31,       31,    30,
                         2007    2007     2007       2007      2008   2008
                        ------- ------- ---------- ---------- ------- -----
Full-time employee
 headcount                  465     531        578        713     985 1,045
Quarterly number of
 transactions captured
 (in billions)            496.0   520.0      561.3      619.3   851.5 886.6



                        September  December   March    June   September
                           30,        31,       31,     30,      30,
                          2008       2008      2009    2009     2009
                        ---------- ---------- ------- ------- ----------
Full-time employee
 headcount                   1,087      1,189   1,204   1,208      1,194
Quarterly number of
 transactions captured
 (in billions)               938.8      993.5 1,045.1 1,052.9    1,083.0




                                 Three Months Ended     Nine Months Ended
                                    September 30,         September 30,
                                --------------------  --------------------
                                  2008       2009       2008       2009
                                ---------  ---------  ---------  ---------
Revenues by geography (in
 thousands):
Customers within the United
 States                         $  55,567  $  62,927  $ 153,675  $ 188,724
Customers outside the United
 States                            22,214     24,925     58,939     73,857
                                ---------  ---------  ---------  ---------
   Total revenues               $  77,781  $  87,852  $ 212,614  $ 262,581
                                =========  =========  =========  =========

Revenues by geography as a
 percentage of total revenues:
Customers within the United
 States                                71%        72%        72%        72%
Customers outside the United
 States                                29         28         28         28
                                ---------  ---------  ---------  ---------
   Total                              100%       100%       100%       100%
                                =========  =========  =========  =========





                              Omniture, Inc.
              Condensed Consolidated Statements of Cash Flows
                              (in thousands)
                                (unaudited)


                                 Three Months Ended     Nine Months Ended
                                    September 30,         September 30,
                                --------------------  --------------------
                                  2008       2009       2008       2009
                                ---------  ---------  ---------  ---------

Cash flows from operating
 activities:
Net loss                        $ (17,280) $  (8,519) $ (36,683) $ (21,580)
Adjustments to reconcile net
 loss to net cash provided by
 operating activities:
   Depreciation and
    amortization                   14,940     15,261     41,340     45,325
   Stock-based compensation         7,801      7,291     25,103     21,750
   Non-cash tax provision
    (benefit)                       7,904          -        (17)         -
   Other non-cash transactions        (56)       (27)      (308)       (59)
   Loss on foreign currency
    forward contracts, net            329        885        329      2,672
   Net changes in operating
    assets and liabilities:
     Accounts receivable, net       2,549     (4,296)   (25,154)   (16,005)
     Prepaid expenses and other
      assets                       (1,897)    (1,039)       112       (146)
     Accounts payable              (2,018)     5,007      4,206      3,753
     Accrued and other
      liabilities                   4,823      4,671      2,812      3,661
     Deferred revenues             11,810       (101)    48,776      7,790
                                ---------  ---------  ---------  ---------
Net cash provided by operating
 activities                        28,905     19,133     60,516     47,161

Cash flows from investing
 activities:
Purchases of investments           (4,977)   (14,989)   (24,808)   (54,927)
Proceeds from sales of
 investments                            -        100     36,970      5,100
Maturities of investments          15,000     10,000     20,000     30,000
Purchases of property and
 equipment                        (13,869)    (4,575)   (41,871)   (16,165)
Purchases of intangible assets       (443)      (464)    (3,317)      (922)
Foreign currency forward
 contracts                           (329)      (799)      (329)    (2,967)
Business acquisitions, net of
 cash acquired                     (1,101)      (234)   (60,822)    (3,823)
                                ---------  ---------  ---------  ---------
Net cash used in investing
 activities                        (5,719)   (10,961)   (74,177)   (43,704)

Cash flows from financing
 activities:
Proceeds from exercise of
 stock options                      2,476      1,976      8,557      2,891
Proceeds from employee stock
 purchase plan                        205        209        330        405
Proceeds from issuance of
 common stock, net of issuance
 costs                                  -          -          -     25,000
Repurchases of vested
 restricted stock                     (30)      (268)      (993)    (1,371)
Proceeds from issuance of
 notes payable, net of
 issuance costs                         -          -      8,006        (51)
Principal payments on notes
 payable and capital lease
 obligations                       (1,483)      (462)    (7,752)    (1,001)
                                ---------  ---------  ---------  ---------
Net cash provided by financing
 activities                         1,168      1,455      8,148     25,873
Effect of exchange rate
 changes on cash and cash
 equivalents                         (756)      (177)      (561)        12
                                ---------  ---------  ---------  ---------
Net increase (decrease) in
 cash and cash equivalents         23,598      9,450     (6,074)    29,342
Cash and cash equivalents at
 beginning of period               48,093     86,912     77,765     67,020
                                ---------  ---------  ---------  ---------
Cash and cash equivalents at
 end of period                  $  71,691  $  96,362  $  71,691  $  96,362
                                =========  =========  =========  =========




                              Omniture, Inc.
                  Condensed Consolidated Balance Sheets
                              (in thousands)
                                (unaudited)


                                                December 31,  September 30,
                                                ------------  ------------
                                                    2008          2009
                                                ------------  ------------
Assets:
Current assets:
  Cash and cash equivalents                     $     67,020  $     96,362
  Short-term investments                               9,997        34,990
  Accounts receivable, net                           106,810       123,465
  Prepaid expenses and other current assets           10,369        11,795
                                                ------------  ------------
    Total current assets                             194,196       266,612

Property and equipment, net                           61,482        56,669
Intangible assets, net                               137,505       112,671
Goodwill                                             427,565       426,867
Long-term investments                                 18,136        13,908
Other assets                                           3,316         2,233
                                                ------------  ------------
    Total assets                                $    842,200  $    878,960
                                                ============  ============

Liabilities and Stockholders' Equity:
Current liabilities:
  Accounts payable                              $      7,662  $     11,501
  Accrued liabilities                                 41,179        40,411
  Current portion of deferred revenues               101,728       115,216
  Current portion of notes payable                     1,617         1,945
  Current portion of capital lease obligations           150            21
                                                ------------  ------------
    Total current liabilities                        152,336       169,094

Deferred revenues, less current portion               10,222         5,241
Notes payable, less current portion                   13,528        12,375
Capital lease obligations, less current portion           79            44
Other liabilities                                      8,467         7,546

Commitments and contingencies
Stockholders' equity:
  Preferred stock                                          -             -
  Common stock                                            73            77
  Additional paid-in capital                         754,151       802,466
  Deferred stock-based compensation                     (366)          (10)
  Accumulated other comprehensive loss                (3,256)       (3,259)
  Accumulated deficit                                (93,034)     (114,614)
                                                ------------  ------------
    Total stockholders' equity                       657,568       684,660
                                                ------------  ------------
      Total liabilities and stockholders'
       equity                                   $    842,200  $    878,960
                                                ============  ============

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