FireEye, Inc (FEYE) saw its loss narrow to $123.37 million, or $0.75 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $135.53 million, or $0.88 a share. On the other hand, adjusted net loss for the quarter narrowed to $29.44 million, or $0.18 a share from a loss of $56.83 million or $0.37 a share, a year ago.
Revenue during the quarter grew 12.56 percent to $186.41 million from $165.62 million in the previous year period. Gross margin for the quarter expanded 31 basis points over the previous year period to 62.96 percent. Operating margin for the quarter stood at negative 59.73 percent as compared to a negative 74.44 percent for the previous year period.
Operating loss for the quarter was $111.35 million, compared with an operating loss of $123.28 million in the previous year period.
However, the adjusted operating loss for the quarter stood at $26.63 million compared to operating loss of $53.15 million in prior year period.
"Our performance in the third quarter ��" with billings, revenue, operating margin, earnings per share and cash flow above guidance ��" reflected customer confidence in FireEye intelligence-led products and services,” said Kevin Mandia, FireEye chief executive officer. “We experienced strong demand for our cloud-based email security and threat intelligence solutions, as well as continued growth in renewal subscriptions. Of the 47 customers who spent more than one million dollars on FireEye solutions in the third quarter, 41 invested in multiple products.”
For the fourth-quarter, Fireeye, Inc. expects revenue to be in the range of $187 million to $193 million. Fireeye, Inc. expects revenue to be in the range of $716 million to $722 million for financial year 2016. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.16 to $0.18 for the fourth-quarter. For financial year 2016, the company projects diluted earnings per share to be in the range of $1.14 to $1.16 on adjusted basis.
Operating cash flow turns negative
FireEye, Inc has spent $21.52 million cash to meet operating activities during the nine month period as against cash inflow of $27.57 million in the last year period.
The company has spent $169.98 million cash to meet investing activities during the nine month period as against cash outgo of $518.83 million in the last year period.
Cash flow from financing activities was $13.09 million for the nine month period, down 98.33 percent or $768.71 million, when compared with the last year period.
Cash and cash equivalents stood at $223.70 million as on Sep. 30, 2016, down 48.80 percent or $213.20 million from $436.90 million on Sep. 30, 2015.
Working capital drops significantly
FireEye, Inc has witnessed a decline in the working capital over the last year. It stood at $538.53 million as at Sep. 30, 2016, down 44.85 percent or $437.99 million from $976.53 million on Sep. 30, 2015. Current ratio was at 1.98 as on Sep. 30, 2016, down from 3.42 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 25 days for the quarter from 41 days for the last year period. Days sales outstanding went down to 57 days for the quarter compared with 68 days for the same period last year.
Days inventory outstanding has decreased to 5 days for the quarter compared with 16 days for the previous year period. At the same time, days payable outstanding went down to 37 days for the quarter from 44 for the same period last year.
Debt moves up
FireEye, Inc has witnessed an increase in total debt over the last one year. It stood at $732.87 million as on Sep. 30, 2016, up 5.07 percent or $35.34 million from $697.53 million on Sep. 30, 2015. Fireeye, Inc. has witnessed an increase in long-term debt over the last one year. It stood at $732.87 million as on Sep. 30, 2016, up 5.07 percent or $35.34 million from $697.53 million on Sep. 30, 2015. Total debt was 30.50 percent of total assets as on Sep. 30, 2016, compared with 28.64 percent on Sep. 30, 2015. Debt to equity ratio was at 0.85 as on Sep. 30, 2016, up from 0.63 as on Sep. 30, 2015.
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