November 3, 2017

Hortonworks Reports Third Quarter 2017 Revenue of $69.0 Million

SANTA CLARA, Calif., Nov. 3, 2017 — Hortonworks, Inc. (NASDAQ: HDP), a leading provider of global data management solutions, today announced financial results for the third quarter of 2017.

“Our record third quarter revenue of $69.0 million exemplified both strong enterprise demand for our platforms and our growing market share,” said Rob Bearden, chief executive officer and chairman of the board of directors of Hortonworks. “We continue to execute in the field and invest in innovation while maintaining operational excellence. I am very excited about the R&D investments we have made in our new Hortonworks DataPlane Service, which will enable our customers to more quickly transform their infrastructure to meet changing business needs driven by the explosion of data.”

Third Quarter 2017 Financial Highlights

  • Revenue: Total GAAP revenue was $69.0 million for the third quarter of 2017, an increase of 45 percent compared to the third quarter of 2016.
  • Gross Profit: Total GAAP gross profit was $47.7 million for the third quarter of 2017, compared to $27.7 million for the same period last year. Non-GAAP gross profit was $49.7 million for the third quarter of 2017, compared to $29.1 million for the same period last year. GAAP gross margin was 69 percent for the third quarter of 2017, compared to 58 percent for the same period last year. Non-GAAP gross margin was 72 percent for the third quarter of 2017, compared to 61 percent for the same period last year.
  • Operating Loss: GAAP operating loss was $44.2 million for the third quarter of 2017, compared to $64.4 million for the same period last year. Non-GAAP operating loss was $15.4 million for the third quarter of 2017, compared to $39.9 million for the same period last year. GAAP operating margin was negative 64 percent for the third quarter of 2017, compared to negative 135 percent for the same period last year. Non-GAAP operating margin was negative 22 percent for the third quarter of 2017, compared to negative 84 percent for the same period last year.
  • Net Loss: GAAP net loss was $45.4 million for the third quarter of 2017, or $0.67 per basic and diluted share, compared to a GAAP net loss of $64.7 million, or $1.10 per basic and diluted share, for the same period last year. Non-GAAP net loss was $16.6 million for the third quarter of 2017, or $0.24 per basic and diluted share, compared to a non-GAAP net loss of $40.2 million, or $0.68 per basic and diluted share, for the same period last year.
  • Deferred Revenue: Deferred revenue was $229.8 million as of September 30, 2017, a 24 percent increase over the $185.4 million reported as of December 31, 2016 and a 47 percent increase over the $156.8 million reported as of September 30, 2016.
  • Cash & Investments: Cash and investments totaled $63.2 million as of September 30, 2017, compared to $89.2 million as of December 31, 2016 and $95.6 million as of September 30, 2016.
  • Operating Cash: Operating cash used was $15.4 million for the third quarter of 2017, compared to $31.1 million for the same period last year.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release.

Recent Business Highlights

  • Hortonworks Advances Global Data Management with Hortonworks DataPlane Service. In September, we announced Hortonworks DataPlane Service (Hortonworks DPS), a solution that makes it simple to provision and operate distributed data systems, no matter what the use case, whether for data science, self-service analytics or data warehousing optimization. Governance capabilities are native and built on open source technologies such as Apache Atlas, which allow Hortonworks DPS users to enjoy easy access to trusted data available behind the firewall, in public cloud or in a combination. This enables organizations to get trusted lineage from source to destination, regardless of type or origin. Hortonworks DPS solves the struggle that data stewards, data engineers, architects, data scientists and analysts face as they contend with existing and new applications, diverse data types and data spread across several deployment environments. Additionally, IBM will integrate its IBM Unified Governance Platform with Hortonworks DPS. When used in tandem, clients will be able to define, implement and operate enterprise-wide governance programs that simplify compliance and analytics.
  • NEC and Hortonworks Expand Partnership to Deliver a Distributed Processing Platform for Big Data. In September, we announced an expansion of our strategic partnership with NEC Corporation (NEC) to deliver a Big Data processing platform. The companies are combining NEC’s Data Platform for Hadoop with Hortonworks Data Platform (HDP), which will allow enterprise customers to process structured and unstructured data in a single platform. NEC will introduce and market the Big Data platform solution globally with support from Hortonworks.
  • Hortonworks Introduces Real-Time Cybersecurity Threat Detection with Extensible Open Data Models.In September, we announced the general availability of Hortonworks Cybersecurity Platform (HCP) powered by Apache Metron. HCP visualizes diverse, streaming security data at scale to aid security operations centers in detecting and responding to threats. The open source platform is already being used by enterprises to detect cyber threats in real time and build business value through security services.
  • DataWorks Summit Sydney Showcases Big Data and Analytics Use Cases Powered by Open Source.  In September, we hosted DataWorks Summit/Hadoop Summit in Sydney. Now in its second year, attendees learned best practices for how open source technologies enable organizations to leverage all their data, on-premises and in the cloud, to drive predictive analytics, data science and artificial intelligence initiatives.
  • Hortonworks Announces Expanded Leadership Roles for Scott Gnau and Arun Murthy. In August, we announced expanded leadership roles for Scott Gnau and Arun Murthy. Scott Gnau’s new role awarded him direct responsibility for Hortonworks’ global engineering team, as well as the product management and support organizations. Co-founder Arun Murthy was named chief product officer and will lead engineering and research and development efforts across the Hortonworks portfolio.

Financial Outlook

As of November 2, 2017, Hortonworks is providing the following financial outlook for its fourth quarter and full year 2017:

For the fourth quarter of 2017, we expect:

  • Total GAAP revenue of $70.0 million.
  • GAAP operating margin between negative 65 percent and negative 60 percent, which includes stock-based compensation and related expenses and amortization of purchased intangibles of approximately $28.0 million.
  • Non-GAAP operating margin between negative 25 percent and negative 20 percent, which excludes stock-based compensation and related expenses and amortization of purchased intangibles of approximately $28.0 million.

For the full year of 2017, we expect:

  • Total GAAP revenue of $257.0 million.
  • GAAP operating margin between negative 80 percent and negative 75 percent, which includes stock-based compensation and related expenses and amortization of purchased intangibles of approximately $108.0 million.
  • Non-GAAP operating margin between negative 38 percent and negative 33 percent, which excludes stock-based compensation and related expenses and amortization of purchased intangibles of approximately $108.0 million.

GAAP operating margin outlook includes estimates of stock-based compensation and related expenses and amortization of purchased intangibles in future periods and assumes, among other things, the occurrence of no additional acquisitions, investments or restructuring and no further revisions to stock-based compensation and related expenses.

Third Quarter 2017 Earnings Conference Call and Webcast Details

Hortonworks will hold a conference call and webcast today to discuss the Q3 2017 results, Q4 2017 and FY 2017 outlook and related matters at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) on Thursday, November 2, 2017. Interested parties may access the call by dialing (877) 930-7786 in the U.S. or (253) 336-7423 from international locations. In addition, a live audio webcast of the conference call will be available on the Hortonworks Investor Relations website at http://investors.hortonworks.com.

Shortly after the conclusion of the conference call, a replay of the audio webcast will be available on the Hortonworks Investor Relations website for approximately seven days.

About Hortonworks

Hortonworks is a leading provider of enterprise-grade, global data management platforms, services and solutions that deliver actionable intelligence from any type of data for over half of the Fortune 100.  Hortonworks is committed to driving innovation in open source communities, providing unique value to enterprise customers. Along with its partners, Hortonworks provides technology, expertise and support so that enterprise customers can adopt a modern data architecture. For more information, visit www.hortonworks.com.


Source: Hortonworks

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