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CallidusCloud Announces Fourth Quarter and Full Year 2015 Total Revenue of $46.8 Million and $173.1 Million
Marketwired
Reaffirms 2016 Total Revenue Guidance of $210.0 Million to $215.0 Million

Callidus Software Inc. (NASDAQ: CALD)

Callidus Software Inc. (NASDAQ: CALD), a global leader in cloud-based sales, marketing, learning and customer experience solutions, today announced financial results for the year ended December 31, 2015.

"We finished 2015 with a strong fourth quarter. We had record total revenues, excellent SaaS growth (off a higher base) and we continued to make money," said Leslie Stretch, president and CEO, CallidusCloud. "We expect our sales and marketing investments to continue to drive momentum in 2016 as we focus on delivering a world-class customer experience, and profitable growth."

Financial Highlights for the Fourth Quarter 2015 Total reported revenue was $46.8 million for the fourth quarter, an increase of 23% and includes $0.9 million of revenue from the Bridgefront acquisition. Total recurring revenue was $36.0 million, which includes SaaS revenue of $32.6 million and maintenance revenue of $3.4 million. SaaS revenue increased 34% over the same quarter in the prior year, benefiting from the continued success in our Lead to Money suite and revenue from Bridgefront. Excluding the Bridgefront revenue, SaaS revenue increased 30% over the same quarter last year. Services and license revenue was $10.8 million, consisting of $10.6 million in services revenue, a 10% increase over prior year, and $0.2 million in license revenue. Cash and short-term investments were $97.2 million. Cash flow from operations for the quarter was $5.9 million, compared to cash used for operations of $965 thousand in the same quarter of the prior year.

GAAP Performance

Non-GAAP Performance The following non-GAAP measures are described below and are reconciled to the corresponding GAAP measures at the end of this release.

Financial Highlights for the Full Fiscal 2015 Total revenue was $173.1 million for the full fiscal year, an increase of 27% and includes $1.5 million of revenue from the BridgeFront acquisition. Total recurring revenue was $129.9 million, which includes SaaS revenue of $115.5 million and maintenance revenue of $14.4 million. SaaS revenue increased 38% over the prior year, including $1.5 million of SaaS revenue from BridgeFront. Services and license revenue of $43.2 million consisted of $41.5 million in services revenue, a 28% increase over prior year, and $1.7 million in license revenue. Cash flow from operations for the full year was $26.5 million, reflecting a 189% increase over last year.

GAAP Performance

Non-GAAP Performance The following non-GAAP measures are described below and are reconciled to the corresponding GAAP measures at the end of this release.

Business Highlights for the Fourth Quarter 2015

Financial Outlook for 2016 - First Quarter and Full Year

For the first quarter of 2016, the Company expects total revenue to be between $47.8 million and $48.8 million, including $750 thousand of revenue from BridgeFront. GAAP operating loss is expected to be between $4.5 million and $6.0 million, with GAAP net loss per share between $0.09 and $0.11. Non-GAAP operating income is expected to be between $2.6 million and $3.6 million, with non-GAAP income per diluted share between $0.04 and $0.06.

For the full year of 2016, the Company is maintaining its previous revenue guidance of $210.0 million to $215.0 million, including $3.0 million of revenue from BridgeFront. We are projecting full-year SaaS revenue growth to be 30% to 35%, including $3.0 million from BridgeFront. GAAP operating loss is expected to be between $15.0 million and $18.0 million, with GAAP net loss per share between $0.29 and $0.33. Non-GAAP operating income is expected to be between $17.0 million and $19.0 million, with non-GAAP income per diluted share between $0.25 and $0.29.

Conference Call

In conjunction with this announcement CallidusCloud will host a conference call at 1:30 p.m. Pacific Standard Time (PST) today to discuss the fourth quarter and outlook for the first quarter 2016 and full year 2016. The conference call will be available via live webcast at the Investor Relations section of CallidusCloud's website.

Webcast site: http://www.calliduscloud.com/about-us/investor-relations Dial-in: 877-280-4960 (International callers: 857-244-7317) Passcode: 66768068 Replay information: A webcast replay will be available on the Investor Relations section of our website under Calendar of Events.

For more information, please visit: http://www.calliduscloud.com/about-us/investor-relations/

About CallidusCloud Callidus Software Inc. (NASDAQ: CALD), doing business as CallidusCloud®, is the global leader in cloud-based sales, marketing and learning solutions. CallidusCloud enables organizations to accelerate and maximize their Lead to Money process with a complete suite of solutions that identify the right leads, ensure proper territory and quota distribution, enable sales forces, automate configure price quote, and streamline sales compensation -- driving bigger deals, faster. Approximately 4,600 leading organizations, across all industries, rely on CallidusCloud to optimize the Lead to Money process to close more deals for more money in record time.

For more information, please visit www.calliduscloud.com.

Non-GAAP Financial Measures

In this release, CallidusCloud has provided additional financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP gross margin, non-GAAP recurring revenue gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, and non-GAAP net income per diluted share. CallidusCloud uses non-GAAP measures internally in analyzing its financial results and believes that they are useful to investors as a supplement to GAAP measures in evaluating CallidusCloud's operating performance. CallidusCloud believes that the use of these non-GAAP measures provides additional insight for investors to use in evaluation of ongoing operating results and trends and in comparing its financial measures with other companies in CallidusCloud's industry, many of which present non-GAAP financial measures that may resemble our non-GAAP financial measures. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

Our non-GAAP measures reflect adjustments based on the following items:

Stock-based compensation expense: We have excluded the effect of stock-based compensation expense from our non-GAAP gross profit, recurring revenue gross profit, operating expenses, operating income, net income and net income per diluted share. We believe the exclusion of stock-based compensation expense provides a useful comparison of our operating results to our peers.

Restructuring and other expense: We have excluded the effect of restructuring and other expense from our non-GAAP operating expenses, operating income, net income and net income per diluted share. Restructuring and other expense consists of employee severance, facility exit costs, impairment of intangible assets and incremental depreciation expense as a result of the change in the estimated useful life of assets abandoned. We feel it is useful to investors to understand the effects of these items on our financial results.

Patent litigation and settlement costs and patent litigation estimates: We have excluded the effect of patent infringement and litigation defense costs, settlement costs and patent litigation estimates from our non-GAAP gross profit, recurring revenue gross profit, operating expenses, operating income, net income and net income per diluted share. We believe patent litigation and settlement costs and patent litigation estimates are not indicative of our ongoing business operations, and are inconsistent in amount and frequency; as such we exclude these costs during our evaluation of our business performance.

Convertible note interest expense, conversion costs and amortization of convertible note issuance costs: We have excluded the costs of convertible note interest expense, redemption inducement and issuance costs from our non-GAAP net income and net income per diluted share. We believe that these costs are not indicative of our continuing operations or meaningful in evaluating current versus past business results.

Amortization and gain on sale of acquired intangible assets: We have excluded the effect of amortization and gain on sale of acquired intangibles which include developed technology, customer relationships, trade names, domain names, patents and licenses from our non-GAAP gross profit, recurring revenue gross profit, operating expenses, operating income, other income and expense, net income and net income per diluted share. Amortization and gain on sale of acquired intangibles are significantly affected by timing, and as such, can be inconsistent in amount and nature.

Acquisition-Related Costs: We have excluded the costs related to acquisitions from our non-GAAP operating expenses, operating income, net income and net income per diluted share. These costs include legal and transactional costs associated with acquisition activities as well as expense related to earnouts that we would not have otherwise incurred in the periods presented as part of our continuing operations. We believe the exclusion of acquisition-related costs provides a useful comparison of our operating results to our peers.

Note on Forward-Looking Statements

The forward-looking statements included in this press release, including for example discussion of our commercial prospects, estimates of future revenues, operating income/loss and expenses, earnings per share, stock-based compensation expenses, amortization of acquired intangible assets, restructuring and other expenses, and patent litigation and settlement costs and estimates reflect management's best judgment based on factors currently known and involve risks and uncertainties. These risks and uncertainties include, but are not limited to, potential disruption of customer purchase decisions resulting from global economic conditions, timing and size of orders, relative growth of our recurring revenue, potential decreases in customer spending, uncertainty regarding purchasing trends in the cloud software market, customer cancellations or non-renewal of maintenance contracts or on-demand services, our potential inability to manage effectively any growth we experience, our ability to develop new products and services, increased competition or new entrants in the marketplace, potential impact of acquisitions and investments, changes in staffing levels, and other risks detailed in periodic reports we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K which may be obtained by contacting CallidusCloud's Investor Relations department at 415-445-3238, or from the Investor Relations section of CallidusCloud's website (http://www.calliduscloud.com/about-us/investor-relations/). Actual results may differ materially from those presently reported. We assume no obligation to update the information contained in this release.

©2016 Callidus Software Inc. All rights reserved. Callidus, Callidus Software, the Callidus Software logo, CallidusCloud, the CallidusCloud logo, 6FigureJobs, BridgeFront, Clicktools, iCentera, Lead to Money, LeadFormix, LeadRocket, Learnpass, Litmos, the Litmos logo, Love Your LMS, Portals for Mortals, Producer Pro, SalesGenius, Surve, Syncfrog, Thunderbridge and TrueComp are trademarks, service marks, or registered trademarks of Callidus Software Inc. and its affiliates in the United States and other countries. All other brand, service or product names are trademarks or registered trademarks of their respective companies or owners.

GAAP to Non-GAAP adjustments include stock-based compensation, amortization of acquired intangible assets, patent litigation and settlement costs and estimates, interest expense on convertible notes, amortization of convertible note issuance costs, debt conversion expense, restructuring and other expenses, acquisition-related costs and gain on sale of domain names and trademarks as follows:

The guidance figures provided below and elsewhere in this press release are forward-looking statements, reflect a number of estimates, assumptions and other uncertainties, and are approximate in nature because the Company's future performance is difficult to predict. Such guidance is based on information available on the date of this press release, and the company assumes no obligation to update it.

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