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ServiceSource Reports Third Quarter 2012 Financial Results

SAN FRANCISCO, CA -- (Marketwire) -- 11/05/12 -- ServiceSource® (NASDAQ: SREV)

  • Reports revenue of $59.1 million, up 18% year-over-year
  • Achieves Adjusted EBITDA of $4.8 million, up 60% year-over-year and non-GAAP EPS of $0.02 per diluted share
  • Releases Renew OnDemand, the world's only cloud service application suite specially built to maximize recurring revenue

ServiceSource® (NASDAQ: SREV), the global leader in recurring revenue management, today announced financial results for the quarter ended September 30, 2012.

"During our third quarter, in the face of some challenging headwinds, we hit several key milestones, including strong new additions to ACV and expansions in our customer base, revenue at the high end of the range and outperformance on EBITDA. In addition, we released Renew OnDemand™, the industry's only purpose-built cloud application for maximizing recurring revenue," stated Mike Smerklo, Chairman and CEO of ServiceSource.

Revenue for the third quarter of fiscal 2012 was $59.1 million, an increase of 18% compared with $50.1 million in the third quarter last year.

Adjusted EBITDA for the quarter, which excludes stock-based compensation, was $4.8 million, compared with $3.0 million for the third quarter of 2011.

GAAP net loss for the third quarter of 2012 was $3.6 million or $0.05 per share, compared with a net loss of $2.8 million, or $0.04 per share, in the same period last year.

Non-GAAP net income for the third quarter of 2012, which excludes stock-based compensation and the amortization of internally-developed software, was $1.9 million, or $0.02 per diluted share. This represented an increase over the third quarter of 2011 non-GAAP net income of $1.1 million, or $0.01 per diluted share.

David Oppenheimer, CFO, added, "While we continue to be encouraged by our execution around our core growth strategies, our positive long-term outlook is balanced in the near-term by challenges in converting ACV to revenue for a handful of new engagements, the timing of signing new ACV in the year and weakening economic conditions, which are adversely impacting certain customers in our portfolio. As a result, we are revising our guidance with respect to revenue growth for the fourth quarter and fiscal 2012."

Recent Business Highlights

  • ServiceSource released Renew OnDemand, the world's only cloud application suite built specifically to maximize recurring revenue.
  • The company signed new customers, Qualcomm and CCH, a Wolters Kluwer business, as well as expansion agreements with BMC, Google and Microsoft, among others.
  • The Company was named among the Top 500 Software Companies by Software Magazine, and Montclair Advisors listed ServiceSource as one of the 2012 Top 250 SaaS companies in the world.

Business Outlook

The Company provided the following commentary on its expected business outlook:

  • Fourth quarter 2012: The Company expects revenue for the fourth quarter of 2012 to be in the range of $62.0 to $64.0 million, adjusted EBITDA of approximately $3.0 to $4.0 million, GAAP net loss of $5.8 to $6.8 million and non-GAAP net loss per share to be between breakeven a penny and two cents.

    Adjusted EBITDA and non-GAAP net income exclude stock-based compensation and amortization of internally-developed software. Non-GAAP earnings per share assume a tax rate of 40% and 80 million fully diluted shares outstanding.
  • Full year 2012: Based on fourth quarter outlook, the Company is revising its revenue guidance for 2012 to be $238.0 to $240.0 million. Revised 2012 adjusted EBITDA guidance is estimated to be $15.5 to $16.5 million, GAAP net loss of $47.5 to $48.5 million and non-GAAP net income per diluted share in the range of six to eight cents. The Company's guidance for GAAP net loss reflects the $33.1 million one-time, non-cash tax charge recorded in the second quarter of 2012.

    Adjusted EBITDA and non-GAAP net income exclude stock-based compensation, the one-time tax charge and amortization of internally-developed software. Non-GAAP earnings per share assume a tax rate of 40% and 79 million shares outstanding.

Quarterly Conference Call

ServiceSource will discuss its quarterly results today via teleconference at 1:30 p.m. Pacific Time. To access the call within the U.S., please dial (877) 293-5486, or outside the U.S. (914) 495-8592, at least five minutes prior to the start time. A live webcast of the call will also be available at http://ir.servicesource.com/events.cfm under the Events & Presentations menu. A replay of the webcast will also be available on the Company's website at http://ir.servicesource.com.

About ServiceSource International, Inc.

ServiceSource is the global leader in recurring revenue management. The world's most successful companies rely on us to maximize subscription, maintenance and support revenue; improve customer retention; and increase business predictability and insight. ServiceSource delivers results with Renew OnDemand™, the world's only cloud application built specifically to manage and grow recurring revenue, which can be combined with our industry-leading services and unique pay-for-performance model.

With over a decade of experience focused exclusively in growing recurring revenue, our services and applications are based on proven best practices and global benchmarks. The Company is headquartered in San Francisco, and has over $7 billion under management for customers in more than 150 countries and 40 languages.

ServiceSource, and any ServiceSource product or service names or logos mentioned above, are trademarks of ServiceSource International, Inc. All other trademarks used herein belong to their respective owners.

For more information on ServiceSource, visit http://www.servicesource.com. To connect with ServiceSource, visit us on Twitter, Facebook, LinkedIn and YouTube.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding ServiceSource's future expected financial results, including its positive long-term outlook, the timing and our ability to convert ACV into revenue, our ability to improve the renewal rates of our customers, economic conditions and their impact on our customers, and the availability of our Renew OnDemand platform and its expected economic impact. These forward-looking statements are based on our current assumptions and beliefs, and involve risks and uncertainties that could cause our results to differ materially from those expressed or implied in our forward-looking statements. Those risks and uncertainties include, without limitation, changes in market conditions that impact our ability to generate service revenue on our customers' behalf; errors in estimates as to the service revenue we can generate for our customers; risks associated with material defects or errors in our software or the effect of data security breaches; our ability to effectively sell and implement our Renew OnDemand platform without significant disruptions to our customer base; our ability to adapt our solution to changes in the market or new competition; our ability to protect our intellectual property rights; general political, economic and market conditions and events; and other risks and uncertainties described more fully in our periodic reports and registration statements filed with the Securities and Exchange Commission, and can be obtained online at the Commission's website at http://www.sec.gov. All forward-looking statements in this press release are based on information currently available to us, and we assume no obligation to update these forward-looking statements.

The following tables reconcile (i) the business outlook net income (loss) to adjusted EBITDA; (ii) the business outlook net income (loss) to non-GAAP net income; and (iii) the business outlook net income (loss) per share to non-GAAP diluted earnings per share for the fourth quarter and full fiscal year.



                     ServiceSource International, Inc.
                              Business Outlook
           Reconciliation of Net Income (Loss) to Adjusted EBITDA
                 ($ in thousands, except per share amounts)

                              Three Months Ended      Twelve Months Ended
                              December 31, 2012        December 31, 2012
                           -----------------------  -----------------------


GAAP Net income (loss)
 range                     $  (6,800) -- $  (5,800) $ (48,500) -- $ (47,500)
Income tax (benefit) /
 expense                                       250                   31,800
Interest & other expense,
 net                                            50                      350
Depreciation &
 Amortization                                3,500                   10,600
                           ---------  -- ---------  ---------  -- ---------
EBITDA range               $  (3,000) -- $  (2,000) $  (5,750) -- $  (4,750)
Stock-based compensation                     6,000                   21,250
                           ---------  -- ---------  ---------  -- ---------
Adjusted EBITDA Range      $   3,000  -- $   4,000  $  15,500  -- $  16,500
                           =========  == =========  =========  == =========


GAAP to Non-GAAP
 Reconciliation


GAAP net income (loss)
 range                     $  (6,800) -- $  (5,800) $ (48,500) -- $ (47,500)
Non-GAAP adjustments:
Stock-based compensation                     6,000                   21,250
Amortization of
 internally-developed
 software                                    1,450                    3,500
Income tax effect on non-
 GAAP adjustments and
 impact of normalizing the
 effective income tax rate       290          (110)    28,980        28,580
                           ---------  -- ---------  ---------  -- ---------
Non-GAAP net income        $     940  -- $   1,540  $   5,230  -- $   5,830
                           =========  == =========  =========  == =========


GAAP diluted net income
 (loss) per share          $   (0.09) -- $   (0.07) $   (0.61) -- $   (0.60)
Non-GAAP adjustments:
Stock-based compensation                      0.08                     0.27
Amortization of
 internally-developed
 software                                     0.02                     0.04
Income tax effect on non-
 GAAP adjustments and
 impact of normalizing the
 effective income tax rate                    0.00                     0.36
                           ---------  -- ---------  ---------  -- ---------
Non-GAAP diluted net
 income per share          $    0.01  -- $    0.02  $    0.06  -- $    0.08
                           =========  == =========  =========  == =========

Shares used in calculating
 diluted net income
 pershare on a non-GAAP
 basis                                      80,000                   79,000
                                         =========                =========


                     ServiceSource International, Inc.
              Condensed Consolidated Statements of Operations
                  (In thousands, except per share amounts)
                                (Unaudited)

                                Three Months Ended      Nine Months Ended
                                  September 30,           September 30,
                              ---------------------   ---------------------
                                 2012        2011        2012        2011
                              ---------   ---------   ---------   ---------

Net revenue                   $  59,090   $  50,088   $ 176,358   $ 144,722
Cost of revenue (1)              34,544      28,034     101,002      82,399
                              ---------   ---------   ---------   ---------
Gross profit                     24,546      22,054      75,356      62,323
                              ---------   ---------   ---------   ---------
Operating expenses
  Sales and marketing (1)        13,512      12,144      41,158      34,664
  Research and development
   (1)                            4,416       3,547      13,295       9,650
  General and administrative
   (1)                           10,000       8,969      30,639      24,692
                              ---------   ---------   ---------   ---------
Total operating expenses         27,928      24,660      85,092      69,006
                              ---------   ---------   ---------   ---------
Loss from operations             (3,382)     (2,606)     (9,736)     (6,683)
Interest expense                    (70)        (27)       (180)       (349)
Other income (expense), net         190         309        (124)       (662)
                              ---------   ---------   ---------   ---------
Loss before income taxes         (3,262)     (2,324)    (10,040)     (7,694)
Income tax provision
 (benefit)                          322         501      31,589     (21,152)
                              ---------   ---------   ---------   ---------
Net income (loss)             $  (3,584)  $  (2,825)  $ (41,629)  $  13,458
                              =========   =========   =========   =========

Net income (loss) per common
 share:
  Basic                       $   (0.05)  $   (0.04)  $   (0.56)  $    0.21
                              =========   =========   =========   =========
  Diluted                     $   (0.05)  $   (0.04)  $   (0.56)  $    0.19
                              =========   =========   =========   =========

Weighted-average shares used
 in computing net income
(loss) per common share:
  Basic                          74,667      69,464      73,994      69,989
                              =========   =========   =========   =========
  Diluted                        74,667      69,464      73,994      72,208
                              =========   =========   =========   =========

(1) Includes stock-based
 compensation expense as
 follows:
                                Three Months Ended       Nine Months Ended
                                   September 30,           September 30,
                              ---------------------   ---------------------
                                 2012        2011        2012        2011
                              ---------   ---------   ---------   ---------
Cost of revenue               $     763   $     470   $   2,050   $   1,286
Sales and marketing               2,180       1,111       5,836       2,981
Research and development            562         327       1,455         864
General and administrative        2,148       1,060       5,919       2,973
                              ---------   ---------   ---------   ---------
Total stock-based
 compensation                 $   5,653   $   2,968   $  15,260   $   8,104
                              =========   =========   =========   =========


                     ServiceSource International, Inc.
                   Condensed Consolidated Balance Sheets
                               (In thousands)
                                (Unaudited)

                                              September 30,    December 31,
                                                   2012            2011
                                              -------------   -------------
Assets
Current assets:
  Cash and cash equivalents                   $     110,277   $      65,983
  Short-term investments                                  -          42,882
  Accounts receivable, net                           58,506          54,095
  Current portion of deferred income taxes              363           3,526
  Prepaid expenses and other                          6,965           7,945
                                              -------------   -------------
Total current assets                                176,111         174,431
Property and equipment, net                          35,332          26,840
Deferred income taxes, net of current
 portion                                              1,496          30,238
Other assets, net                                     1,193           1,118
Goodwill                                              6,334           6,334
                                              -------------   -------------
Total assets                                  $     220,466   $     238,961
                                              =============   =============

Liabilities and Stockholders' Equity
Current liabilities:
  Accounts payable                            $       5,577   $       8,617
  Accrued taxes                                       1,026             924
  Accrued compensation and benefits                  16,775          21,749
  Other accrued liabilities (including
   deferred revenue of $2,815 and $593 at
   September 30, 2012 and December 31, 2011,
   respectively)                                      9,237           7,639
  Current portion of capital lease
   obligations                                          733             706
                                              -------------   -------------
Total current liabilities                            33,348          39,635
Long-term obligations                                 6,060           2,310
                                              -------------   -------------
Total liabilities                                    39,408          41,945
                                              -------------   -------------
Stockholders' equity:
  Common stock                                            8               7
  Treasury stock                                       (441)           (441)
  Additional paid-in capital                        203,667         177,796
  Retained earnings (accumulated deficit)           (22,213)         19,416
  Accumulated other comprehensive income                 37             238
                                              -------------   -------------
Total stockholders' equity                          181,058         197,016
                                              -------------   -------------
Total liabilities and stockholders' equity    $     220,466   $     238,961
                                              =============   =============


                   ServiceSource International, Inc.
            Condensed Consolidated Statements of Cash Flows
                            (In thousands)
                              (Unaudited)
                                               Nine Months Ended
                                                 September 30,
                                         -----------------------------
                                              2012            2011
                                         -------------   -------------
Cash flows from operating activities
Net income (loss)                        $     (41,629)  $      13,458
Adjustments to reconcile net income
 (loss) to net cash used in operating
 activities:
  Depreciation and amortization                  7,092           7,109
  Loss on disposal of fixed assets                   -              46
  Amortization of deferred financing
   costs                                           135             325
  Accretion on premium on short-term
   investments                                     577              87
  Deferred income taxes                         32,534         (22,229)
  Stock-based compensation                      15,260           8,104
  Tax benefit from stock-based
   compensation                                   (266)         (2,382)
Changes in operating assets and
 liabilities:
  Accounts receivable                           (4,237)          6,433
  Prepaid expenses and other                       734          (2,169)
  Accounts payable                              (1,087)             73
  Accrued taxes                                     85           3,201
  Accrued compensation and benefits             (5,094)          3,410
  Accrued payables to customers                      -         (30,640)    *
  Other accrued liabilities                      5,050             789
                                         -------------   -------------
Net cash provided by (used in)
 operating activities                            9,154         (14,385)
                                         -------------   -------------

Cash flows from investing activities
Acquisition of property and equipment          (17,049)         (8,784)
Purchases of short-term investments,
 net                                           (31,100)        (47,854)
Sales of marketable securities                  52,050             961
Maturities of marketable securities             21,415           1,000
                                         -------------   -------------
Net cash provided by (used in)
 investing activities                           25,316         (54,677)
                                         -------------   -------------

Cash flows from financing activities
Net proceeds from issuance of common
 stock in initial public offering and
 follow-on offering                                  -         111,105
Proceeds from revolving credit facility              -          23,424
Repayment of revolving credit facility               -         (23,424)
Repayments of long-term debt and
 capital leases                                   (234)        (15,747)
Payments of deferred debt issuance
 costs                                               -            (200)
Proceeds from common stock issuances            10,279           7,198
Tax benefit from stock-based
 compensation                                      266           2,382
                                         -------------   -------------
Net cash provided by financing
 activities                                     10,311         104,738
                                         -------------   -------------

Net increase (decrease) in cash and
 cash equivalents                               44,781          35,676
Effect of exchange rate changes on cash
 and cash equivalents                             (487)            (35)
Cash and cash equivalents at beginning
 of period                                      65,983          22,652
                                         -------------   -------------
Cash and cash equivalents at end of
 period                                  $     110,277   $      58,293
                                         =============   =============

* Activity in 2011 resulted from $18.1 million in payments to Oracle/Sun and
the related settlement of accrued payables owed to Oracle/Sun and amounts
owed to the Company by Oracle/Sun.

Use of Non-GAAP Financial Measures

To supplement its financial statements presented in accordance with generally accepted accounting principles, or GAAP, ServiceSource also provides investors with non-GAAP gross profit, net income, net income per share and Adjusted EBITDA. A reconciliation of these non-GAAP financial measures to the closest GAAP financial measure is presented in the financial tables below under the heading, "GAAP to Non-GAAP Reconciliation."

ServiceSource believes that the non-GAAP financial information provided in this release can assist investors in understanding and assessing its on-going core operations and prospects for the future and provides an additional tool for investors to use in comparing ServiceSource's financial results with other companies in the industry, many of which present similar non-GAAP financial measures to investors.

Non-GAAP gross profit consists of gross profit plus stock based compensation and amortization of internally-developed software.

Non-GAAP net income consists of net income (loss) plus stock-based compensation, amortization of internally-developed software and applying an income tax rate of 40% reflecting our estimated tax expense on our core operations. Accordingly, our non-GAAP calculation of net income has excluded a one-time, non-cash income tax charge of $33.1 million recorded during the period ended June 30, 2012 related to a valuation allowance for a substantial portion of the company's deferred tax assets. Results for the nine months ended September 30, 2011 reflect a one-time tax benefit related to the conversion of ServiceSource from a limited liability corporation to a Delaware corporation, which has also been excluded from the calculation of non-GAAP net income. Stock-based compensation expenses are expected to vary depending on the number of new grants issued, changes in the company's stock price, stock market volatility, expected option lives and risk-free rates of return, all of which are difficult to estimate.

EBITDA consists of net income (loss) plus depreciation and amortization, interest expense, other expenses, net, and income tax expense and a deduction for income tax benefit. Adjusted EBITDA consists of EBITDA plus non-cash, stock-based compensation expense. ServiceSource uses Adjusted EBITDA as a measure of operating performance because it assists the company in comparing performance on a consistent basis, as it removes from the operating results the impact of the company's capital structure.

These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with generally accepted accounting principles in the United States.



                     ServiceSource International, Inc.
           Reconciliation of Net Income (Loss) to Adjusted EBITDA
                               (In thousands)
                                (Unaudited)

                            Three Months Ended         Nine Months Ended
                               September 30,             September 30,
                         ------------------------  ------------------------
                             2012         2011         2012         2011
                         -----------  -----------  -----------  -----------

Net income (loss)        $    (3,584) $    (2,825) $   (41,629) $    13,458
Income tax provision
 (benefit)                       322          501       31,589      (21,152)
Interest expense                  70           27          180          349
Other income (expense),
 net                            (190)        (309)         124          662
Depreciation                   2,504        2,621        7,092        7,109
                         -----------  -----------  -----------  -----------
EBITDA                          (878)          15       (2,644)         426
Stock-based compensation       5,653        2,968       15,260        8,104
                         -----------  -----------  -----------  -----------
Adjusted EBITDA          $     4,775  $     2,983  $    12,616  $     8,530
                         ===========  ===========  ===========  ===========


                     ServiceSource International, Inc.
                      GAAP To Non-GAAP Reconciliation
              (Dollars in thousands, except per share amounts)
                                (unaudited)

                              Three Months Ended       Nine Months Ended
                                 September 30,           September 30,
                            ----------------------  -----------------------
                               2012         2011       2012         2011
                            ----------   ---------  ----------   ----------
Gross Profit
  GAAP gross profit         $   24,546    $ 22,054  $   75,356   $   62,323
  Non-GAAP
   adjustments:
    Stock-based
     compensation     ( A )        763         470       2,050        1,286
    Amortization of
     internally-
     developed
     software         ( B )        432         389         890        1,196
                            ----------   ---------  ----------   ----------
  Non-GAAP gross
   profit                   $   25,741    $ 22,913  $   78,296   $   64,805
                            ==========   =========  ==========   ==========

Gross Profit %
  GAAP gross profit                 42%        44%          43%          43%
  Non-GAAP
   adjustments:
    Stock-based
     compensation     ( A )          1%         1%           1%           1%
    Amortization of
     internally-
     developed
     software         ( B )          1%         1%           1%           1%
                            ----------   ---------  ----------   ----------
  Non-GAAP gross
   profit                           44%        46%          44%          45%
                            ==========   =========  ==========   ==========
Certain totals do not
 add due to rounding
Operating Expenses
GAAP operating
 expenses                   $   27,928    $ 24,660  $   85,092   $   69,006
Stock-based
 compensation         ( A )     (4,890)    (2,498)     (13,210)      (6,818)
Amortization of
 internally-developed
 software             ( B )       (355)      (789)      (1,167)      (1,922)
                            ----------   ---------  ----------   ----------
Non-GAAP operating
 expenses                   $   22,683    $ 21,373  $   70,715   $   60,266
                            ==========   =========  ==========   ==========

Net Income (Loss)
  GAAP net income
   (loss)                   $   (3,584)  $ (2,825)  $  (41,629)  $   13,458
  Non-GAAP
   adjustments:
    Stock-based
     compensation     ( A )      5,653       2,968      15,260        8,104
    Amortization of
     internally-
     developed
     software         ( B )        787       1,178       2,057        3,118
    One-time tax items( C )          -           -      33,072      (21,417)
    Income tax effect
     on non-GAAP
     adjustments and
     impact of
     normalizing the
     effective income
     tax rate         ( D )       (949)      (228)      (4,394)      (1,147)
                            ----------   ---------  ----------   ----------
Non-GAAP net income         $    1,907     $ 1,093  $    4,366   $    2,116
                            ==========   =========  ==========   ==========

Diluted Net Income
 (Loss) Per Share
  GAAP diluted net
   income (loss) per
   share                    $    (0.05)   $ (0.04)  $    (0.56)  $     0.19
  Non-GAAP
   adjustments:
    Stock-based
     compensation     ( A )       0.07        0.04        0.20         0.11
    Amortization of
     internally-
     developed
     software         ( B )       0.01        0.01        0.03         0.04
    One-time tax items( C )          -           -        0.42        (0.30)
    Income tax effect
     on non-GAAP
     adjustments and
     impact of
     normalizing the
     effective income
     tax rate         ( D )      (0.01)       0.00       (0.06)       (0.01)
                            ----------   ---------  ----------   ----------
  Non-GAAP diluted net
   income per share         $     0.02      $ 0.01  $     0.03   $     0.03
                            ==========   =========  ==========   ==========
Shares used in
 calculating diluted
 net income per share
 on a non-GAAP basis            79,859      77,093      78,220       72,208
                            ==========   =========  ==========   ==========

Footnotes to GAAP to Non-GAAP Reconciliation
----------------------------------------------------------------------------

 ( A ) Stock-based compensation. Included in our GAAP presentation of cost
       of revenue and operating expenses, stock-based compensation consists
       of expenses for stock options and awards and purchase rights under
       our stock purchase plan. We exclude stock-based compensation expense
       from our non-GAAP measures because some investors may view it as not
       reflective of our core operating performance as it is a non-cash
       expense.



 ( B ) Amortization of internally-developed software. Included in our GAAP
       presentation of cost of revenue and operating expenses, amortization
       of internally-developed software reflects non-cash expense for
       certain software purchases and software developed or obtained for
       internal use. We exclude these expenses from our non-GAAP measures
       because we believe they are not indicative of our core operating
       performance.



 ( C ) One-time tax items. We elected to be treated as a corporation under
       Subchapter C of Chapter 1 of the United States Internal Revenue Code,
       effective March 1, 2011, and therefore became subject to federal and
       state tax expense beginning March 1, 2011. As a result of this tax
       election, we recorded a net deferred tax asset and a one-time non-
       cash tax benefit of $21.4 million in the first quarter of 2011.
       During the second quarter of 2012, we recorded a $33.1 million non-
       cash charge against a substantial portion of our deferred tax assets,
       much of which was recorded in connection with electing to be treated
       as a corporation, because the recoverability of these items for
       financial reporting purposes is uncertain. We have excluded these
       items from our non-GAAP measures because they are non-recurring and
       unique, they are non-cash in nature and are not indicative of our
       core operating performance.





 ( D ) Income tax effect on non-GAAP adjustments and impact of normalizing
       the effective income tax rate. This adjusts the provision for income
       taxes to reflect the effect of the non-GAAP items A, B and C noted
       above on our non-GAAP net income and adjusts the income tax rate to a
       normalized effective tax rate of 40%.


                     ServiceSource International, Inc.
                             Revenue by Segment
                               (In thousands)
                                (unaudited)

                                       Three Months Ended September 30,
                                  -----------------------------------------
                                          2012                  2011
                                  -------------------   -------------------
                                               % of                  % of
                                      $       Revenue       $       Revenue
                                  ---------  --------   ---------  --------

NALA                              $  37,647        64%  $  31,952        64%
EMEA                                 14,159        24%     12,365        25%
APJ                                   7,284        12%      5,771        11%
                                  ---------  --------   ---------  --------
                                  $  59,090       100%  $  50,088       100%
                                  =========  ========   =========  ========


                                       Nine Months Ended September 30,
                                          2012                  2011
                                  -------------------   -------------------
                                               % of                  % of
                                      $       Revenue       $       Revenue
                                  ---------  --------   ---------  --------

NALA                              $ 110,720        63%  $  88,383        61%
EMEA                                 45,425        26%     41,612        29%
APJ                                  20,213        11%     14,727        10%
                                  ---------  --------   ---------  --------
                                  $ 176,358       100%  $ 144,722       100%
                                  =========  ========   =========  ========

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