Verint Announces Another Quarter of Strong Cloud Growth

Verint®, The Customer Engagement Company™, today announced results for the three and six months ended July 31, 2021 (FYE 2022). Revenue for the three months ended July 31, 2021 was $215 million on a GAAP basis representing 5% year-over-year growth and $216 million on a non-GAAP basis representing 4% year-over-year growth. Revenue for the six months ended July 31, 2021 was $416 million on a GAAP basis representing 7% year-over-year growth and $418 million on a non-GAAP basis representing 5% year-over-year growth. For the three months ended July 31, 2021, diluted EPS was $0.00 on a GAAP basis and, $0.58 on a non-GAAP basis. For the six months ended July 31, 2021, net loss per common share was ($0.04) on a GAAP basis, and diluted EPS was $1.01 on a non-GAAP basis.

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“Supplemental Information About Non-GAAP Financial Measures and Operating Metrics”

“Since the completion of the Cognyte spin at the beginning of the year, we have experienced strong cloud momentum and believe we have crossed the mid-point of our cloud transition. We expect our cloud momentum to continue in the second half of the year and we are raising our annual outlook for non-GAAP revenue, cloud revenue and diluted EPS. We are also raising our annual outlook for new perpetual license equivalent bookings growth, which we believe is an important metric during our cloud transition and a leading indicator of future revenue growth,” said Dan Bodner, Verint CEO.

Bodner added: “Behind our strong momentum is our strategy to drive automation in customer engagement across the enterprise with our open cloud platform. We believe that more and more brands are embracing digital first engagement and that we are uniquely positioned to help them with our open, partner friendly, infrastructure-agnostic cloud platform. We continue to rapidly innovate our cloud platform to power the workforce of people and bots, to embrace an enterprise-wide customer experience culture, and to harness data to drive more AI and analytics into their business.”

Second Quarter Key Cloud Metrics

• Strong Cloud Growth: Cloud revenue up more than 43% year-over-year
• Strong Software Bookings Growth: New perpetual license equivalent (PLE) bookings up 17% year-over-year
• SaaS Bookings Mix: 53% of PLE bookings from SaaS compared to 43% in the same quarter in the prior year
• Improving Visibility from Multi-year Cloud Deals: Remaining performance obligations (RPO) increased 29% year-over-year to $627 million

FYE 2022 Outlook

We are increasing our non-GAAP annual outlook for the year ending January 31, 2022 as follows:

• Cloud Revenue Growth: 35% (up from a range of 30% to 35%)
• New PLE Bookings Growth: 15% (up from 10%+)
• Revenue: $872 million with a range of +/- 2% (up from $860 million)
  • We expect Q3 revenue to be between $215 to $220 million and to finish the year with our typical seasonally strong fourth quarter revenue.
• Diluted EPS: $2.25 at the midpoint of our revenue guidance (up from $2.23)
  • We expect Q3 diluted EPS of $0.53 at the midpoint of our revenue guidance and to finish the year with our typical seasonally strong fourth quarter profitability.

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Our non-GAAP outlook for the three months ending October 31, 2021 and year ending January 31, 2022 excludes the following GAAP measures which we are able to quantify with reasonable certainty:

• Amortization of intangible assets of approximately $11 million and $45 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.
• Expenses and losses on debt modification or retirement of $0 million and $2 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.
• Favorable change in fair value of future tranche right of $0 million and $16 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.
• Unrealized losses on derivatives, net of $0 million and $14 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.

Our non-GAAP outlook for the three months ending October 31, 2021 and year ending January 31, 2022 excludes the following GAAP measures for which we are able to provide a range of probable significance:

• Revenue adjustments are expected to be between approximately $1 million and $2 million, and $3 million and $4 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.
• Stock-based compensation expenses are expected to be between approximately $15 million and $17 million, and $64 million and $70 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively, assuming market prices for our common stock approximately consistent with current levels.
• Further costs associated with Verint’s February 1, 2021 separation into two independent public companies are expected to be between approximately $2 million and $3 million, and $12 million and $15 million, for the three months ending October 31, 2021 and year ending January 31, 2022, respectively.

Our non-GAAP outlook does not include the potential impact of any in-process business acquisitions that may close after the date hereof, and, unless otherwise specified, reflects foreign currency exchange rates approximately consistent with current rates.

We are unable, without unreasonable efforts, to provide a reconciliation for other GAAP measures which are excluded from our non-GAAP outlook, including the impact of future business acquisitions or acquisition expenses, future restructuring expenses, and non-GAAP income tax adjustments due to the level of unpredictability and uncertainty associated with these items. For these same reasons, we are unable to assess the probable significance of these excluded items. While historical results may not be indicative of future results, actual amounts for the three and six months ended July 31, 2021 and 2020 for the GAAP measures excluded from our non-GAAP outlook appear in Tables 2, 3 and 4 of this press release.

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