Ultimate Software (Nasdaq:ULTI), a leading cloud provider of people management solutions, announced today its financial results for the third quarter of 2012. For the quarter ended September 30, 2012, Ultimate reported recurring revenues of $67.5 million, a 23% increase, and total revenues of $82.6 million, a 22% increase, both compared with 2011’s third quarter. GAAP net income for the third quarter of 2012 was $4.7 million, or $0.16 per diluted share, versus GAAP net income of $1.1 million, or $0.04 per diluted share, for the third quarter of 2011.
Non-GAAP net income, which excludes stock-based compensation and amortization of acquired intangible assets, was $8.1 million, or $0.29 per diluted share, for the third quarter of 2012, compared with non-GAAP net income of $4.9 million, or $0.18 per diluted share, for the third quarter of 2011. See “Use of Non-GAAP Financial Information” below.
“Our third quarter results were consistent with expectations in our three most important goal areas: growth in recurring revenues, customer retention, and growth in our operating margin. Our recurring revenues were up by more than 23% for the quarter to $67.5 million while our annualized customer retention rate was greater than 96% and our operating margin was just over 17%,” said Scott Scherr, CEO, president, and founder of Ultimate. “Our new customers continued to attach talent, time, and tax management products to their core purchases, and market demand metrics for our solutions continued to be strong in the third quarter.
“In early October, we showcased our latest version of UltiPro at the HR Technology Conference. With this release, we have strengthened our go-to-market strategy by delivering deeper global HCM capabilities and a number of other enhancements, such as significant advances in payroll processing speed for very large organizations, more configurable talent management for richer employee performance management, and cloud connectivity through an ecosystem of partners that includes CERTPOINT Systems, Informatica, and Yammer. All of our cloud customers are live on this release.”