ADVERTISEMENT
PRESS RELEASE: Paid content from Business Wire
Press release content from Business Wire. The AP news staff was not involved in its creation.

New Relic Announces Third Quarter Fiscal Year 2021 Results

February 4, 2021 GMT

SAN FRANCISCO--(BUSINESS WIRE)--Feb 4, 2021--

New Relic, Inc. (NYSE: NEWR), a leader in observability, today announced financial results for the third quarter of fiscal year 2021.

“Our financial results for the third quarter reflect the positive early reception we’re seeing from our customers to the changes we’ve made across our go-to-market and platform strategies,” said Lew Cirne, CEO and founder, New Relic. “We are successfully migrating the majority of our larger customers onto the new model and engagement is increasing as evidenced by steady growth in data ingest, two positive signs of momentum from our customers.”

ADVERTISEMENT

Third Quarter Fiscal Year 2021 Financial Highlights:

  • Revenue of $166 million, compared to $153 million for the third quarter of fiscal 2020.
  • GAAP gross margin of 72% and non-GAAP gross margin of 74%.
  • GAAP loss from operations was $(48.0) million, compared to $(24.2) million for the third quarter of fiscal 2020.
  • Non-GAAP income (loss) from operations was $(8.4) million, compared to $3.0 million for the third quarter of fiscal 2020.
  • GAAP net loss attributable to New Relic per basic share was $(0.88), compared to a loss of $(0.46) per basic share for the third quarter of fiscal 2020.
  • Non-GAAP net income (loss) attributable to New Relic per diluted share was $(0.14), compared to $0.09 per diluted share for the third quarter of fiscal 2020.
  • Cash used in operating activities was $(6.7) million and free cash flow was $(12.7) million for the third quarter of fiscal 2021.
  • Cash, cash equivalents and short-term investments were $785 million at the end of the third quarter of fiscal 2021, compared with $840 million at the end of the second quarter of fiscal 2021.
  • Remaining performance obligations were $648 million at the end of the third quarter of fiscal 2021, compared with $602 million at the end of the second quarter of fiscal 2021. This represents the aggregate unrecognized transaction price of remaining performance obligations as of each of December 31, 2020 and September 30, 2020.

Key Operating Metrics*:

 

Jun-19

Sep-19

Dec-19

Mar-20

Jun-20

Sep-20

Dec-20

1Q20

2Q20

3Q20

4Q20

1Q21

2Q21

3Q21

Annual Recurring Revenue, or ARR (in millions)

$569

$591

$608

$642

$648

$649

$669

Dollar-Based Net Expansion Rate

109%

112%

109%

116%

100%

98%

108%

Percentage of ARR from Paid Business Accounts > $100,000

70%

71%

72%

75%

76%

77%

79%

Paid Business Accounts > $100,000

881

908

927

995

1,025

1,039

1,051

* In the fourth quarter of fiscal 2020, we adjusted the way we define ARR to include partner revenue and revenue from support subscriptions. This change results in immaterial differences in the presentation of some numbers in the chart above compared to our disclosures in historical filings. Please refer to our Annual Report on Form 10-K for the fiscal year ended March 31, 2020 for our definition of ARR and the differences between these disclosures.

ADVERTISEMENT

Recent Business Highlights:

Outlook:

  • Fourth Quarter Fiscal 2021 Outlook:
    • Revenue between $166 million and $167 million, representing year-over-year growth of approximately 4%.
    • Non-GAAP loss from operations between $(29.0) million and $(31.0) million.
    • Non-GAAP net loss attributable to New Relic per diluted share between $(0.45) and $(0.49).
    • ARR of approximately $669 million, flat sequentially, and representing year-over-year growth of approximately 4%, compared to $642 million as of March 31, 2020.

New Relic has not reconciled its expectations as to non-GAAP income (loss) from operations or non-GAAP net income (loss) per diluted share to their most directly comparable GAAP measures as a result of uncertainty regarding, and the potential variability of, reconciling items such as stock-based compensation expense, lawsuit litigation cost and other expense, employer payroll taxes on equity incentive plans and gain or loss from lease modification. Accordingly, reconciliation is not available without unreasonable effort, although it is important to note that these factors could be material to New Relic’s results computed in accordance with GAAP.

Conference Call and Investor Letter Details:

  • What: New Relic financial results for the third quarter of fiscal year 2021 and outlook for the fourth quarter of fiscal 2021.
  • When: February 4, 2021 at 2:00 P.M. Pacific Time (5:00 P.M. Eastern Time)
  • Dial in: To access the call in the United States, please dial (844) 757-5730, and for international callers, please dial (412) 542-4120. Callers may provide confirmation number 10151250 to access the call more quickly, and are encouraged to dial into the call at least 15 minutes prior to the start to prevent any delay in joining.
  • Webcast: http://ir.newrelic.com (live and replay)
  • Investor Letter: Available at http://ir.newrelic.com
  • Replay: Following the completion of the call through 11:59 PM Eastern Time on February 11, 2021, a telephone replay will be available by dialing (877) 344-7529 from the United States or (412) 317-0088 internationally with conference ID 10151250.

About New Relic

The world’s best engineering teams rely on New Relic to visualize, analyze and troubleshoot their software. New Relic One is the most powerful cloud-based observability platform built to help companies create more perfect software. Learn why developers trust New Relic for improved uptime and performance, greater scale and efficiency, and accelerated time to market at newrelic.com.

Forward-Looking Statements

This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the federal securities laws, including but not limited to statements regarding: New Relic’s future financial performance, including its outlook on financial results for the fourth quarter of fiscal 2021, such as revenue, non-GAAP loss from operations, non-GAAP net loss attributable to New Relic per diluted share, ARR, market opportunities, the value proposition behind the reimagined New Relic One platform, the ongoing success of our entitlements program and overall growth in data ingest, our continued rollout of product enhancements and layering of new functionalities into existing products, expectations of continued refinement of New Relic’s product and sales execution, expectations that the recent acquisition of Pixie Labs will accelerate Kubernetes adoption and allow New Relic to be a primary beneficiary of incremental growth in that space, expectations that the reimagined New Relic One platform and move to a consumption pricing model will accelerate demand and change the way customers purchase and consume software, help New Relic step up in growth, shift New Relic’s existing business metrics to other metrics better suited to tracking the consumption model, and increase New Relic’s presence and standing in the observability market, and any expected financial impacts and increase in customer usage, adoption and aggregate spend as a result of these changes. These forward-looking statements are based on New Relic’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause New Relic’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement.

The risks and uncertainties referred to above include, but are not limited to, New Relic’s ability to determine optimal prices for its products and the potential challenges presented by New Relic’s evolving pricing models; the effect of the COVID-19 pandemic on New Relic’s business and on global economies and financial markets generally; New Relic’s ability to generate sufficient revenue to achieve and sustain profitability, particularly in light of its significant ongoing expenses; New Relic’s short operating history in an evolving industry; New Relic’s ability to manage its significant recent growth; the dependence of New Relic’s business on its customers remaining on its platform and increasing their spend with New Relic; New Relic’s ability to develop enhancements to its products, increase adoption and usage of its products and introduce new products that achieve market acceptance; the dependence on customers expanding their use of New Relic’s products beyond the current predominant use cases; New Relic’s ability to expand its marketing and sales capabilities and increase sales of its solutions; privacy concerns, including changes in privacy laws and regulations, which could result in additional cost and liability to New Relic or inhibit sales; New Relic’s ability to effectively compete in intensely competitive markets and respond effectively to rapidly changing technology, evolving industry standards and changing customer needs, requirements or preferences; fluctuation of New Relic’s quarterly results; New Relic’s dependence on lead generation strategies to drive sales and revenue; interruptions or performance problems associated with New Relic’s technology and infrastructure; New Relic’s dependence on SaaS technologies and related services from third parties; defects or disruptions in New Relic’s products; the expense and complexity of New Relic’s ongoing and planned investments in data center hosting facilities and expenditures on cloud hosting providers; risks associated with international operations; New Relic’s ability to protect its intellectual property rights; risks related to the acquisition and integration of businesses or technologies; risks related to sales to government entities and highly regulated organizations; certain risks associated with incurring indebtedness, including risks related to servicing New Relic’s convertible senior notes and related capped call transactions; and other “Risk Factors” set forth in New Relic’s most recent filings with the Securities and Exchange Commission (the “SEC”).

Further information on these and other factors that could affect New Relic’s financial results and the forward-looking statements in this press release and in the earnings call referencing this press release is included in the filings New Relic makes with the SEC from time to time, particularly under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and subsequent filings. Copies of these documents may be obtained by visiting New Relic’s Investor Relations website at http://ir.newrelic.com or the SEC’s website at www.sec.gov.

All information provided in this press release and in the earnings call is as of the date hereof and New Relic assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Non-GAAP Financial Measures

New Relic discloses the following non-GAAP financial measures in this press release and the earnings call referencing this press release: non-GAAP income (loss) from operations, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (sales and marketing, research and development, general and administrative), non-GAAP operating margin, non-GAAP net income (loss) attributable to New Relic, non-GAAP net income (loss) attributable to New Relic per diluted share, non-GAAP net income (loss) attributable to New Relic per basic share and free cash flow. New Relic uses each of these non-GAAP financial measures internally to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, for short- and long-term operating plans, and to evaluate New Relic’s financial performance. In addition, New Relic’s bonus plan for eligible employees and executives is based in part on non-GAAP income (loss) from operations. New Relic believes these non-GAAP financial measures are useful to investors, as a supplement to GAAP measures, in evaluating its operational performance, as further discussed below. New Relic’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on New Relic’s reported financial results.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.

New Relic defines non-GAAP income (loss) from operations, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (sales and marketing, research and development, general and administrative), non-GAAP operating margin, non-GAAP net income (loss) attributable to New Relic, non-GAAP net income (loss) attributable to New Relic per diluted share and non-GAAP net income (loss) attributable to New Relic per basic share as the respective GAAP balances, adjusted for, as applicable: (1) stock-based compensation expense, (2) lease exit costs and accelerated depreciation, (3) amortization of stock-based compensation capitalized in software development costs, (4) the amortization of purchased intangibles, (5) employer payroll tax expense on equity incentive plans, (6) amortization of debt discount and issuance costs, and in certain periods (7) the transaction costs related to acquisitions, (8) lawsuit litigation cost and other expense and (9) gain or loss from lease modification. Non-GAAP net income (loss) per basic and diluted share is calculated as non-GAAP net income (loss) attributable to New Relic divided by weighted-average shares used to compute net income (loss) attributable to New Relic per share, basic and diluted, with the number of weighted-average shares decreased to reflect the anti-dilutive impact of the capped call transactions entered into in connection with the 0.50% Convertible Senior Notes due 2023 issued in May 2018. New Relic defines free cash flow as GAAP cash from operations, minus capital expenditures and minus capitalized software. Investors are encouraged to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures.

Management believes these non-GAAP financial measures are useful to investors and others in assessing New Relic’s operating performance due to the following factors:

Stock-based compensation expense and amortization of stock-based compensation capitalized in software development costs. New Relic utilizes share-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of its stockholders and at long-term retention, rather than to address operational performance for any particular period. As a result, share-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period.

Lease exit costs and accelerated depreciation. In fiscal year 2020, New Relic entered into an agreement to exit the lease of its 123 Mission premises in San Francisco, California. In connection with this agreement and subsequent relocation, New Relic accelerated depreciation and other expenses associated with the remaining lease term. New Relic believes it is useful to exclude this depreciation and these other expenses because it does not consider such amounts to be part of the ongoing operation of its business.

Amortization of purchased intangibles and transaction costs related to acquisitions. New Relic views amortization of purchased intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of purchased intangibles is an expense that is not typically affected by operations during any particular period. Similarly, New Relic views acquisition-related expenses as events that are not necessarily reflective of operational performance during a period.

Lawsuit litigation cost and other expense. New Relic may from time to time incur charges or benefits related to litigation that are outside of the ordinary course of New Relic’s business. New Relic believes it is useful to exclude such charges or benefits because it does not consider such amounts to be part of the ongoing operation of New Relic’s business and because of the singular nature of the claims underlying the matter.

Employer payroll tax expense on equity incentive plans. New Relic excludes employer payroll tax expense on equity incentive plans as these expenses are tied to the exercise or vesting of underlying equity awards and the price of New Relic’s common stock at the time of vesting or exercise. As a result, these taxes may vary in any particular period independent of the financial and operating performance of New Relic’s business.

Amortization of debt discount and issuance costs. In May 2018, New Relic issued $500.25 million of convertible senior notes due in 2023, which bear interest at an annual fixed rate of 0.50%. The effective interest rate of the convertible senior notes was approximately 5.74%. This is a result of the debt discount recorded for the conversion feature that is required to be separately accounted for as equity, and debt issuance costs, which reduce the carrying value of the convertible debt instrument. The debt discount is amortized as interest expense together with the issuance costs of the debt. The expense for the amortization of debt discount and debt issuance costs is a non-cash item, and we believe the exclusion of this interest expense will provide for a more useful comparison of our operational performance in different periods.

Gain or loss from lease modification. New Relic may incur a gain or loss from modification related to lease agreements. New Relic believes it is useful to exclude such charges or benefits because it does not consider such amounts to be part of the ongoing operation of New Relic’s business and because of the singular nature of benefit or charge from such events.

Anti-dilutive impact of capped call transactions. In connection with the issuance of its convertible senior notes due in 2023, New Relic entered into capped call transactions to offset potential dilution from the embedded conversion feature in the notes. Although New Relic cannot reflect the anti-dilutive impact of the capped call transactions under GAAP, New Relic does reflect the anti-dilutive impact of the capped call transactions in non-GAAP net income (loss) attributable to New Relic per share, basic and diluted, to provide investors with useful information in evaluating the financial performance of the company on a per share basis.

Additionally, New Relic’s management believes that the non-GAAP financial measure free cash flow is meaningful to investors because management reviews cash flows generated from operations after taking into consideration capital expenditures and the capitalization of software development costs due to the fact that these expenditures are considered to be a necessary component of ongoing operations.

Operating Metrics

New Relic defines the number of paid business accounts at the end of any particular period as the number of accounts at the end of the period as identified by a unique account identifier for which New Relic has recognized revenue on the last day of the period indicated. A single organization or customer may have multiple paid business accounts for separate divisions, segments, or subsidiaries.

New Relic’s monthly recurring revenue represents the revenue that New Relic would contractually expect to receive from those customers over the following month, including partner revenue or revenue from support subscriptions, without any increase or reduction in any of their subscriptions.

Similarly, annual recurring revenue (“ARR”) represents the revenue New Relic would contractually expect to receive from those customers over the following 12-month period, including partner revenue or revenue from support subscriptions, without any increase or reduction in any of their contractual commitments. The net change New Relic reports in ARR reflects any increase in ARR from existing customers and new customers, which is referred to as “new ARR,” as well as any reduction in ARR from customers who reduced their spend or terminated their relationship with New Relic, which is referred to as “lost ARR.”

For contracts entered into under the new pricing model announced on July 30, 2020, New Relic only recognizes as ARR the committed contractual amount for customers under the Annual Pool of Funds model; therefore, the definition of ARR would not include contracts under the Pay as You Go model. Meanwhile, ARR for contracts under Annual Pool of Funds is calculated as the original dollar commitment for the annual contract period, plus any incremental additional dollar commitments added during the term of the period. ARR is measured without reference or adjustments for historic data usage, and therefore excludes assumptions related to overage spend or expected or received overages above committed amounts.

New Relic’s dollar-based net expansion rate compares its recurring revenue from customers from one period to the next. It is increased when customers increase their contractual spend amounts in order to increase their use of New Relic’s products or use additional products. New Relic’s dollar-based net expansion rate is reduced when customers decrease or terminate their contractual spend amounts in order to decrease or cease use of New Relic’s products or use fewer products.

New Relic is a registered trademark of New Relic, Inc.

All product and company names herein may be trademarks of their registered owners.

 
Condensed Consolidated Statements of Operations
(In thousands, except per share data; unaudited)
Three Months Ended December 31, Nine Months Ended December 31,

2020

 

2019

 

2020

 

2019

Revenue

$ 166,340

$ 153,028

$ 494,979

$ 439,853

Cost of revenue

45,968

26,402

124,439

75,164

Gross profit

120,372

126,626

370,540

364,689

Operating expenses:
Research and development

45,773

38,387

131,245

106,858

Sales and marketing

92,392

87,704

266,906

244,711

General and administrative

30,249

24,751

89,481

71,129

Total operating expenses

168,414

150,842

487,632

422,698

Loss from operations

(48,042)

(24,216)

(117,092)

(58,009)

Other income (expense):
Interest income

1,734

3,793

6,735

11,944

Interest expense

(6,229)

(5,953)

(18,549)

(17,660)

Other income (expense), net

(811)

(465)

(1,810)

2,828

Loss before income taxes

(53,348)

(26,841)

(130,716)

(60,897)

Income tax provision

564

894

1,276

1,518

Net loss

$ (53,912)

$ (27,735)

$ (131,992)

$ (62,415)

Net loss attributable to redeemable non-controlling interest

286

540

1,059

1,437

Net loss attributable to New Relic

$ (53,626)

$ (27,195)

$ (130,933)

$ (60,978)

Net loss attributable to New Relic per share, basic and diluted

$ (0.88)

$ (0.46)

$ (2.16)

$ (1.05)

Weighted-average shares used to compute net loss per share, basic and diluted

61,209

58,733

60,562

58,352

 
Condensed Consolidated Balance Sheets
(In thousands, except par value; unaudited)
December 31, 2020 March 31, 2020
Assets
Current assets:
Cash and cash equivalents

$ 211,145

$ 292,523

Short-term investments

573,472

512,574

Accounts receivable, net of allowances of $2,376 and $3,636, respectively

143,775

147,361

Prepaid expenses and other current assets

16,236

15,979

Deferred contract acquisition costs

34,738

32,016

Total current assets

979,366

1,000,453

Property and equipment, net

93,011

100,294

Restricted cash

5,662

5,641

Goodwill

144,253

45,112

Intangible assets, net

14,662

13,691

Deferred contract acquisition costs, non-current

30,295

28,141

Lease right-of-use assets

59,475

57,777

Other assets, non-current

6,785

7,325

Total assets

$ 1,333,509

$ 1,258,434

Liabilities, redeemable non-controlling interest and stockholders’ equity
Current liabilities:
Accounts payable

$ 22,034

$ 12,565

Accrued compensation and benefits

39,416

29,054

Other current liabilities

15,838

13,120

Deferred revenue

301,750

313,161

Lease liabilities

5,600

8,682

Total current liabilities

384,638

376,582

Convertible senior notes, net

443,676

427,044

Lease liabilities, non-current

62,849

57,394

Deferred revenue, non-current

1,681

3,166

Other liabilities, non-current

8,092

1,940

Total liabilities

900,936

866,126

Redeemable non-controlling interest

610

1,669

Stockholders’ equity:
Common stock, $0.001 par value

63

60

Treasury stock - at cost (260 shares)

(263)

(263)

Additional paid-in capital

956,670

780,479

Accumulated other comprehensive income

932

4,869

Accumulated deficit

(525,439)

(394,506)

Total stockholders’ equity

431,963

390,639

Total liabilities, redeemable non-controlling interest, and stockholders’ equity

$ 1,333,509

$ 1,258,434

 
Condensed Consolidated Statements of Cash Flows
(In thousands; unaudited)
Nine Months Ended December 31,

2020

2019

Cash flows from operating activities:
Net loss attributable to New Relic

$ (130,933)

$ (60,978)

Net loss attributable to redeemable non-controlling interest

$ (1,059)

$ (1,437)

Net loss:

$ (131,992)

$ (62,415)

Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization

66,315

56,237

Stock-based compensation expense

103,044

70,496

Amortization of debt discount and issuance costs

16,632

15,718

Gain on lease modification

-

(3,006)

Other

1,812

(2,919)

Changes in operating assets and liabilities, net of acquisition of business:
Accounts receivable, net

3,586

10,015

Prepaid expenses and other assets

(999)

(204)

Deferred contract acquisition costs

(33,093)

(25,786)

Lease right-of-use assets

(1,338)

19,539

Accounts payable

10,015

4,257

Accrued compensation and benefits and other liabilities

18,141

1,136

Lease liabilities

2,158

(16,812)

Deferred revenue

(12,896)

(34,590)

Net cash provided by operating activities

41,385

31,666

Cash flows from investing activities:
Purchases of property and equipment

(15,799)

(49,705)

Cash paid for acquisition, net of cash acquired

(41,536)

(4,250)

Purchases of short-term investments

(293,844)

(337,070)

Proceeds from sale and maturity of short-term investments

228,050

292,409

Capitalized software development costs

(9,739)

(4,463)

Net cash used in investing activities

(132,868)

(103,079)

Cash flows from financing activities:
Investment from redeemable non-controlling interest

-

978

Proceeds from employee stock purchase plan

6,494

5,933

Proceeds from exercise of employee stock options

3,632

5,977

Net cash provided by financing activities

10,126

12,888

Net decrease in cash, cash equivalents and restricted cash

(81,357)

(58,525)

Cash, cash equivalents and restricted cash at beginning of period

298,164

243,161

Cash, cash equivalents and restricted cash at end of period

$ 216,807

$ 184,636

 

Reconciliation from GAAP to Non-GAAP Results
(In thousands, except per share data; unaudited)

Three Months Ended December 31, Nine Months Ended December 31,

2020

 

2019

 

2020

 

2019

Reconciliation of gross profit and gross margin:
GAAP gross profit

$ 120,372

$ 126,626

$ 370,540

$ 364,689

Plus: Stock-based compensation expense

1,472

1,315

4,596

3,837

Plus: Lease exit costs and accelerated depreciation expense

-

-

-

73

Plus: Amortization of purchased intangibles

1,277

415

3,829

1,295

Plus: Amortization of stock-based compensation capitalized in software development costs

339

219

843

653

Plus: Employer payroll tax on employee equity incentive plans

36

33

177

186

Non-GAAP gross profit

$ 123,496

$ 128,608

$ 379,985

$ 370,733

GAAP gross margin

72%

83%

75%

83%

Non-GAAP adjustments

2%

1%

2%

1%

Non-GAAP gross margin

74%

84%

77%

84%

Reconciliation of operating expenses:
GAAP research and development

$ 45,773

$ 38,387

$ 131,245

$ 106,858

Less: Stock-based compensation expense

(10,960)

(8,611)

(30,214)

(23,073)

Less: Lease exit costs and accelerated depreciation expense

-

-

-

(326)

Less: Employer payroll tax on employee equity incentive plans

(154)

(120)

(713)

(641)

Non-GAAP research and development

$ 34,659

$ 29,656

$ 100,318

$ 82,818

GAAP sales and marketing

$ 92,392

$ 87,704

$ 266,906

$ 244,711

Less: Stock-based compensation expense

(15,115)

(11,090)

(42,960)

(30,682)

Less: Lease exit costs and accelerated depreciation expense

-

-

-

(2,240)

Less: Employer payroll tax on employee equity incentive plans

(155)

(177)

(671)

(615)

Non-GAAP sales and marketing

$ 77,122

$ 76,437

$ 223,275

$ 211,174

GAAP general and administrative

$ 30,249

$ 24,751

$ 89,481

$ 71,129

Less: Stock-based compensation expense

(8,922)

(4,934)

(25,274)

(12,904)

Less: Lease exit costs and accelerated depreciation expense

-

-

-

(1,002)

Less: Transaction costs related to acquisition

(885)

(251)

(885)

(251)

Less: Lawsuit litigation cost and other expense

(217)

-

(254)

(1,521)

Less: Employer payroll tax on employee equity incentive plans

(116)

(52)

(559)

(244)

Non-GAAP general and administrative

$ 20,109

$ 19,514

$ 62,509

$ 55,207

Reconciliation of income (loss) from operations and operating margin:
GAAP loss from operations

$ (48,042)

$ (24,216)

$ (117,092)

$ (58,009)

Plus: Stock-based compensation expense

36,469

25,950

103,044

70,496

Plus: Lease exit costs and accelerated depreciation expense

-

-

-

3,641

Plus: Amortization of purchased intangibles

1,277

415

3,829

1,295

Plus: Transaction costs related to acquisition

885

251

885

251

Plus: Amortization of stock-based compensation capitalized in software development costs

339

219

843

653

Plus: Lawsuit litigation cost and other expense

217

-

254

1,521

Plus: Employer payroll tax on employee equity incentive plans

461

382

2,120

1,686

Non-GAAP income (loss) from operations

$ (8,394)

$ 3,001

$ 6,117

$ 21,534

GAAP operating margin

(29)%

(16)%

(24)%

(13)%

Non-GAAP adjustments

24%

18%

23%

18%

Non-GAAP operating margin

(5)%

2%

(1)%

5%

Reconciliation of net income (loss):
GAAP net loss attributable to New Relic

$ (53,626)

$ (27,195)

$ (130,933)

$ (60,978)

Plus: Stock-based compensation expense

36,469

25,950

103,044

70,496

Plus: Lease exit costs and accelerated depreciation expense

-

-

-

3,641

Plus: Amortization of purchased intangibles

1,277

415

3,829

1,295

Plus: Transaction costs related to acquisition

885

251

885

251

Plus: Amortization of stock-based compensation capitalized in software development costs

339

219

843

653

Plus: Lawsuit litigation cost and other expense

217

-

254

1,521

Plus: Employer payroll tax on employee equity incentive plans

461

382

2,120

1,686

Plus: Amortization of debt discount and issuance costs

5,622

5,314

16,632

15,718

Less: Gain on lease modification

-

-

-

(3,006)

Non-GAAP net income (loss) attributable to New Relic

$ (8,356)

$ 5,336

$ (3,326)

$ 31,277

Non-GAAP net income (loss) attributable to New Relic per share:
Basic

$ (0.14)

$ 0.09

$ (0.05)

$ 0.54

Diluted

$ (0.14)

$ 0.09

$ (0.05)

$ 0.52

Shares used in non-GAAP per share calculations:
Basic

61,209

58,733

60,562

58,352

Diluted

61,209

60,358

60,562

60,299

 
Reconciliation of GAAP Cash Flows from Operating Activities to Free Cash Flow
(In thousands; unaudited)
Three Months Ended December 31, Nine Months Ended December 31,

2020

 

2019

 

2020

 

2019

Net cash provided by (used in) operating activities

$ (6,673)

$ (13,838)

$ 41,385

$ 31,666

Capital expenditures

(3,158)

(18,135)

(15,799)

(49,705)

Capitalized software development costs

(2,896)

(1,410)

(9,739)

(4,463)

Free cash flow (Non-GAAP)

$ (12,727)

$ (33,383)

$ 15,847

$ (22,502)

Net cash used in investing activities

$ (59,987)

$ (52,514)

$ (132,868)

$ (103,079)

Net cash provided by financing activities

$ 982

$ 2,923

$ 10,126

$ 12,888

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20210204006036/en/

CONTACT: Investors

Peter Goldmacher

New Relic, Inc.

503-336-9280

IR@newrelic.com

Media

Andrew Schmitt

New Relic, Inc.

415-869-7109

PR@newrelic.com

KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA

INDUSTRY KEYWORD: TECHNOLOGY SOFTWARE

SOURCE: New Relic Corporate Communications

Copyright Business Wire 2021.

PUB: 02/04/2021 04:05 PM/DISC: 02/04/2021 04:06 PM

http://www.businesswire.com/news/home/20210204006036/en