Qlik Technologies Management Discusses Q2 2012 Results - Earnings Call Transcript

Qlik Technologies (QLIK)

Q2 2012 Earnings Call

July 26, 2012 5:00 pm ET


Staci Mortenson - Senior Vice President

Lars Björk - Chief Executive Officer, President and Director

William G. Sorenson - Chief Financial Officer, Treasurer and Secretary


John S. DiFucci - JP Morgan Chase & Co, Research Division

Keith Weiss - Morgan Stanley, Research Division

Chris Koh - Stifel, Nicolaus & Co., Inc., Research Division

Steven M. Ashley - Robert W. Baird & Co. Incorporated, Research Division

Nicole Hayashi - UBS Investment Bank, Research Division

Ross MacMillan - Jefferies & Company, Inc., Research Division

Shawn Yuan - Roth Capital Partners, LLC, Research Division

Jesse Hulsing - Pacific Crest Securities, Inc., Research Division

Robert Chen - Citigroup Inc, Research Division

Greg McDowell - JMP Securities LLC, Research Division

Edward Maguire - Credit Agricole Securities (USA) Inc., Research Division



Good day, ladies and gentlemen, and welcome to your QlikTech Second Quarter 2012 Earnings Conference Call. [Operator Instructions] And as a reminder, today's conference is being recorded.

And now, I would like to introduce your host for today, Staci Mortenson. Please go ahead, ma'am.

Staci Mortenson

Thank you, operator. Good afternoon, and thank you for joining us today to review Qlik Technologies' second quarter 2012 financial results. With me on the call today are Lars Björk, Chief Executive Officer; and Bill Sorenson, Chief Financial Officer. After prepared remarks, we will open up the call to a question-and-answer session.

During this call, we may make statements related to our business that will be considered forward-looking statements under the federal securities laws. Words such as, but not limited to, predicts, plans, expects, anticipates, believes, goal, target, estimate, potential, may, will, might, momentum, could, seek and similar words will identify forward-looking statements. These statements reflect our views only as of today and should not be relied upon as representing our views as of any subsequent date. These statements reflecting our current views regarding the future are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations.

For a discussion of the material risks and other important factors that could affect our actual results, please refer to our SEC filings available on the SEC's EDGAR system and our website. We encourage all investors to read our SEC filings.

Qlik Technologies expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements made herein, except as required by law.

Additionally, non-GAAP financial measures will be discussed on this conference call. A reconciliation to the most directly comparable GAAP financial measures can be found in our press release, which is available at our website, www.qliktech.com, under the Investor Relations tab. Also, please note that our webcast of today's call will be available on our website in the Investor Relations section.

With that, I'd like to turn the call over to our Chief Executive Officer, Lars Björk. Lars?

Lars Björk

Thanks, Staci. And I'd like to start by thanking all of you for joining us today. For the second quarter 2012, we reported total revenue of $85.8 million, representing an increase of 16% over the prior year period. On a constant currency basis, total revenue grew 24% over the prior year period. Even with a challenging macroeconomic environment, we were still able to show a substantial year-over-year growth. This further reinforces that QlikView delivers rapid value, and this is even more important in today's tough business condition. Businesses of all sizes are dealing with a deluge data and need QlikView to transform this data into knowledge by making it understandable and actionable.

Our non-GAAP operating income for the quarter was $2.4 million, and non-GAAP net income was $0.02 per diluted common share.

As we discussed with you on our preannouncement call a few weeks ago, the macroeconomic environment posed some challenges for QlikTech, particularly in Europe. We saw prolonged sales cycles causing delays, some strengthening of deal sizes to help get through procurement and customers need for additional signatures for further ROI justification.

We believe that the deal that flipped largely remain in play and are very hopeful that we will be able to close the meaningful portion before year end.

We did not see any adverse changes in the competitive landscape or pricing pressure and continue to believe that we are gaining market share. Our focus now is on adapting to the new sales environment. This requires more legwork to identifying qualified deals, as well as more rigor to move deals through the pipeline from commit to close. We are improving our processes to ensure we have the proper resources to support pipeline development and deal closure and are better aware of all the requirements. We're also broadly evaluating our sales methodologies to help ensure we are applying best practices across our direct and indirect teams, as well as partners. We continue to believe that the market opportunity remains large and there's a real demand for our solutions. We believe the steps we are taking will better position us to navigate through current business conditions.

With that said, let's spend a moment with some of additional business highlights from the quarter. We are excited about the acquisition of Expressor Software. Their metadata management software fulfills our customers' growing need to describe data consistently and then reuse it to speed up deployment of additional application. We believe this metadata-intelligent solution will be an expanded use of our Business Discovery platform and will help IT departments know what data is being used and how it's being used, while ensuring consistency and appropriate reuse of common data definitions. This is a capability that has become increasingly important especially for enterprise deployment. The initial response has been positive, and we are seeing interest within our installed base. In addition, Expressor fits squarely in our acquisition strategy of adding complementary tuck-in technology that enhances the value we provide to our customers, and we are very pleased to have this team on board.

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