Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 16, 2017 
FIVE9, INC.
(Exact name of Registrant as specified in its charter)
 
 
 
 
Delaware
001-36383
94-3394123
(State or other jurisdiction
of incorporation)
(Commission
File No.)
(I.R.S. Employer
Identification No.)
 
 
Bishop Ranch 8
4000 Executive Parkway, Suite 400
San Ramon, California 94583
(Address of principal executive offices and Zip Code)
Registrant’s telephone number, including area code: (925) 201-2000
Not Applicable
(Former name or former address if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





Item 2.02 Results of Operations and Financial Condition.
On February 16, 2017, Five9, Inc. (the “Company”) announced its financial results for the fiscal quarter and year ended December 31, 2016. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in Item 2.02 of this Current Report on Form 8-K (including Exhibit 99.1 furnished herewith) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 8.01  Other Events.
The Company’s Board of Directors has determined that the Company's 2017 Annual Meeting of Stockholders (the "Annual Meeting") will be held on May 15, 2017 virtually via the Internet beginning at 8:30 a.m. Pacific Daylight Time. Stockholders of record at the close of business on the record date, March 23, 2017, may vote at the Annual Meeting, including any adjournment or postponement thereof.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
 
Exhibit No.
  
Description
 
 
99.1
  
Press Release issued by the Company on February 16, 2017





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
 
 
 
 
 
FIVE9, INC.
 
 
 
 
 
Date: February 16, 2017
 
 
 
 
 
By:
 
/s/ Barry Zwarenstein
 
 
 
 
 
 
 
 
Barry Zwarenstein
 
 
 
 
 
 
 
 
Chief Financial Officer





INDEX TO EXHIBITS
 
Exhibit No.
  
Description
 
 
99.1
  
Press Release issued by the Company on February 16, 2017


Exhibit
Exhibit 99.1
https://cdn.kscope.io/b15ca0fef2820116217d7c06e33d5e28-five9logoprimaryrgba03a09.jpg

Five9 Reports Record 2016 Revenue of $162.1 Million, Up 26% Year-Over-Year
LTM Enterprise Subscription Revenue Growth of 43%
2016 Operating Cash Flow Improves by $19.8 Million
Fourth Quarter Record Revenue of $44.2 Million

SAN RAMON, CALIF. - February 16, 2017 - Five9, Inc. (NASDAQ:FIVN), a leading provider of cloud software for the enterprise contact center market, today reported results for the fourth quarter and full year ended December 31, 2016.
Fourth Quarter 2016 Financial Results
Total revenue for the fourth quarter of 2016 increased 23% to a record $44.2 million, compared to $36.0 million for the fourth quarter of 2015.
GAAP gross margin was 64.3% for the fourth quarter of 2016, compared to 56.6% for the fourth quarter of 2015. Included in the GAAP results for the fourth quarter of 2016 was a reversal of accrued federal fees of $3.1 million following a favorable FCC ruling. This reversal increased the Company’s GAAP gross margin by 7.0 percentage points from 57.3% for the quarter.
Adjusted gross margin was 61.9% for the fourth quarter of 2016, compared to 61.4% for the fourth quarter of 2015.
GAAP net income for the fourth quarter of 2016 was $0.4 million, or $0.01 per share, compared to a GAAP net loss of $(3.5) million, or $(0.07) per share, for the fourth quarter of 2015. Excluding the $3.1 million accrual reversal, GAAP net loss for 2016 was $(2.7) million, or $(0.05) per share.

1


Non-GAAP net income for the fourth quarter of 2016 was $0.1 million, or $0.00 per share, compared to a non-GAAP net loss of $(1.6) million, or $(0.03) per share, for the fourth quarter of 2015. Fourth quarter of 2016 was the first time the Company reported positive non-GAAP net income.
Adjusted EBITDA for the fourth quarter of 2016 was $2.9 million, or 6.6% of revenue, compared to $1.2 million, or 3.5% of revenue, for the fourth quarter of 2015.
GAAP operating cash flow for the fourth quarter of 2016 was $2.8 million, compared to GAAP operating cash outflow of $(0.1) million for the fourth quarter of 2015.

2016 Financial Results
Total revenue for 2016 increased 26% to $162.1 million, compared to $128.9 million in 2015.
GAAP gross margin was 58.7% for 2016, compared to 53.8% in 2015. Included in the GAAP results for 2016 was a fourth quarter reversal of accrued federal fees of $3.1 million following a favorable FCC ruling. This reversal increased the Company’s GAAP gross margin by 1.9 percentage points from 56.8% for the year.
Adjusted gross margin was 61.7% for 2016, compared to 59.1% in 2015.
GAAP net loss for 2016 was $(11.9) million, or $(0.23) per share, compared to GAAP net loss of $(25.8) million, or $(0.52) per share, in 2015. Excluding the $3.1 million reversal, GAAP net loss for 2016 was $(15.0) million, or $(0.29) per share.
Non-GAAP net loss for 2016 was $(3.6) million, or $(0.07) per share, compared to non-GAAP net loss of $(16.5) million, or $(0.33) per share, in 2015.
Adjusted EBITDA for 2016 was $8.4 million, or 5.2% of revenue, compared to a loss of $(5.3) million, or (4.1)% of revenue, in 2015.
GAAP operating cash flow for 2016 was $6.8 million, compared to a GAAP operating cash outflow of $(12.9) million in 2015.

2



“Our strong fourth quarter results capped off a record year for Five9. For the year, we grew revenue by 26% to a record $162.1 million. This revenue growth was driven by our faster growing Enterprise business, which delivered 43% growth in LTM Enterprise subscription revenue, and where we saw average deal size increase to approximately $560,000 in annual revenue. I’m also very pleased that we set an all-time record for Enterprise bookings in the fourth quarter and full year. In addition, we continued to enjoy leverage in our business model as we delivered strong improvements to our bottom line, including reaching the new milestone of positive net income in the fourth quarter. We believe our continued execution combined with our differentiated cloud contact center software, positions Five9 extremely well in this large contact center market that is still in the early days of a massive shift to the cloud.”
- Mike Burkland, President and CEO, Five9

Business Highlights
All-time record enterprise bookings for the quarter and the full year
2016 average new enterprise deal size of approximately $560,000 in annual revenue, up from an average of $450,000 in 2015
LTM enterprise subscription revenue grew 43% year-over-year, up from 38% in the year ago period
LTM enterprise revenue increased to 69% of total revenue, up from 65% in the year ago period
Annual dollar-based retention rate was 100%, up from 96% in the year ago period
Business Outlook
For the full year 2017, Five9 expects to report:
Revenue in the range of $187.0 to $190.0 million
GAAP net loss in the range of $(17.3) to $(20.3) million, or $(0.32) to $(0.38) per share
Non-GAAP net loss in the range of $(1.5) to $(4.5) million, or $(0.03) to $(0.08) per share

3


For the first quarter of 2017, Five9 expects to report:
Revenue in the range of $44.0 to $45.0 million
GAAP net loss in the range of $(5.3) to $(6.3) million, or a loss of $(0.10) to $(0.12) per share
Non-GAAP net loss in the range of $(1.7) to $(2.7) million, or a loss of $(0.03) to $(0.05) per share

Conference Call Details
Five9 will discuss its fourth quarter and full year 2016 results today, February 16, 2017, via teleconference at 4:30 p.m. Eastern Time. To access the call (ID 3153708), please dial: 888-855-5428 or 719-325-2444. An audio replay of the call will be available through March 2, 2017 by dialing 888-203-1112 or 719-457-0820 and entering access code 3153708. A copy of this press release will be furnished to the Securities and Exchange Commission on a Current Report on Form 8-K, and will be posted to our web site, prior to the conference call.
A webcast of the call will be available on the Investor Relations section of the Company’s website at http://investors.five9.com/.

Non-GAAP Financial Measures
In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures. We calculate adjusted gross profit by adding back the following items to gross profit: depreciation, amortization, stock-based compensation expenses and reversal of accrued federal fees. We calculate adjusted EBITDA by adding back the following items to net income (loss): depreciation, amortization, stock-based compensation expenses, interest expense, income tax expense, interest income and other, which consists primarily of interest income and foreign exchange gains and losses, extinguishment of debt, an immaterial one time out of period adjustment for sales taxes and reversal of accrued federal fees. We calculate non-GAAP operating income (loss) by adding back the following items to operating income (loss): stock-based compensation expenses, amortization, an immaterial one time out of period adjustment for sales taxes and reversal of accrued federal fees. We calculate non-GAAP net income (loss) as net income (loss) by adding back the following items: stock-based compensation expenses, amortization, extinguishment of debt, amortization of debt discount and issuance costs, an immaterial one time out of period adjustment for sales taxes and reversal of accrued federal fees. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies.  Five9 considers these non-GAAP financial measures to be important because they provide useful measures of the operating performance of the Company, exclusive of factors that do not directly affect what we consider to be our core operating performance, as well as unusual events. The Company’s management uses these measures to (i) illustrate underlying trends in the Company’s business that could otherwise be masked by the effect of income or expenses that are excluded from non-GAAP measures, and (ii) establish budgets and operational goals for managing the Company’s business and evaluating its performance. In addition, investors often use similar measures to evaluate the operating performance of a company. Non-GAAP financial measures are presented only as supplemental information for purposes of understanding the Company's operating results. The non-GAAP financial measures should not be considered a substitute for financial information

4


presented in accordance with GAAP. Please see the reconciliation of non-GAAP financial measures set forth herein and attached to this release.
Forward Looking Statements
This news release contains certain forward-looking statements, including the statements in the quote from our Chief Executive Officer, including statements regarding Five9’s market position and contact center market trends, increasing demand for Five9’s solutions, and the first quarter 2017 and full year 2017 financial projections set forth under the caption “Business Outlook,” that are based on our current expectations and involve numerous risks and uncertainties that may cause these forward-looking statements to be inaccurate. Risks that may cause these forward-looking statements to be inaccurate include, among others: (i) our quarterly and annual results may fluctuate significantly, may not fully reflect the underlying performance of our business and may result in decreases in the price of our common stock; (ii) if we are unable to attract new clients or sell additional services and functionality to our existing clients, our revenue and revenue growth will be harmed; (iii) our recent rapid growth may not be indicative of our future growth, and if we continue to grow rapidly, we may fail to manage our growth effectively; (iv) failure to adequately expand our direct sales force will impede our growth; (v) if we fail to manage our technical operations infrastructure, our existing clients may experience service outages, our new clients may experience delays in the deployment of our solution and we could be subject to, among other things, claims for credits or damages; (vi) the markets in which we participate are highly competitive, and if we do not compete effectively, our operating results could be harmed; (vii) if our existing clients terminate their subscriptions or reduce their subscriptions and related usage, our revenues and gross margins will be harmed and we will be required to spend more money to grow our client base; (viii) we sell our solution to larger organizations that require longer sales and implementation cycles and often demand more configuration and integration services or customized features and functions that we may not offer, any of which could delay or prevent these sales and harm our growth rates, business and operating results; (ix) because a significant percentage of our revenue is derived from existing clients, downturns or upturns in new sales will not be immediately reflected in our operating results and may be difficult to discern; (x) we rely on third-party telecommunications and internet service providers to provide our clients and their customers with telecommunication services and connectivity to our cloud contact center software and any failure by these service providers to provide reliable services could subject us to, among other things, claims for credits or damages; (xi) we have a history of losses and we may be unable to achieve or sustain profitability; (xii) we may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs; and (xiii) the other risks detailed from time-to-time under the caption “Risk Factors” and elsewhere in our Securities and Exchange Commission filings and reports, including, but not limited to, our most recent quarterly report on Form 10-Q. Such forward looking statements speak only as of the date hereof and readers should not unduly rely on such statements. We undertake no obligation to update the information contained in this press release, including in any forward-looking statements.

About Five9
Five9 is a leading provider of cloud software for the enterprise contact center market, bringing the power of the cloud to thousands of customers and facilitating more than three billion customer interactions annually. Since 2001, Five9 has led the cloud revolution in contact centers, helping organizations transition from legacy premise-based solutions to the cloud. Five9 provides businesses with reliable, secure, compliant, and scalable cloud contact center software designed to create exceptional customer experiences, increase agent productivity, and deliver tangible business results. For more information, visit www.five9.com.

5


FIVE9, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
 
 
December 31, 2016
 
December 31, 2015
 
 
(Unaudited)
 
 
ASSETS
 
 
 
 
Current assets:
 
 
 
 
Cash and cash equivalents
 
$
58,122

 
$
58,484

Accounts receivable, net
 
13,881

 
10,567

Prepaid expenses and other current assets
 
3,008

 
2,184

Total current assets
 
75,011

 
71,235

Property and equipment, net
 
14,688

 
13,225

Intangible assets, net
 
1,539

 
2,041

Goodwill
 
11,798

 
11,798

Other assets
 
2,203

 
934

Total assets
 
$
105,239

 
$
99,233

 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable
 
$
3,366

 
$
2,569

Accrued and other current liabilities
 
9,604

 
7,911

Accrued federal fees
 
2,742

 
5,684

Sales tax liability
 
1,347

 
1,262

Revolving line of credit
 

 
12,500

Notes payable
 
742

 
7,212

Capital leases
 
6,230

 
4,972

Deferred revenue
 
10,047

 
6,413

Total current liabilities
 
34,078

 
48,523

Revolving line of credit — less current portion
 
32,594

 

Sales tax liability — less current portion
 
1,476

 
1,915

Notes payable — less current portion
 
318

 
17,327

Capital leases — less current portion
 
5,915

 
4,606

Other long-term liabilities
 
530

 
582

Total liabilities
 
74,911

 
72,953

Stockholders’ equity:
 
 
 
 
Common stock
 
53

 
51

Additional paid-in capital
 
196,555

 
180,649

Accumulated deficit
 
(166,280
)
 
(154,420
)
Total stockholders’ equity
 
30,328

 
26,280

Total liabilities and stockholders’ equity
 
$
105,239

 
$
99,233




6


FIVE9, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
 
 
Three Months Ended
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
December 31, 2016
 
December 31, 2015
 
 
(Unaudited)
 
(Unaudited)
 
(Unaudited)
 
 
Revenue
 
$
44,207

 
$
36,033

 
$
162,090

 
$
128,868

Cost of revenue
 
15,770

 
15,635

 
66,934

 
59,495

Gross profit
 
28,437

 
20,398

 
95,156

 
69,373

Operating expenses:
 
 
 
 
 
 
 
 
Research and development
 
6,236

 
5,580

 
23,878

 
22,659

Sales and marketing
 
14,480

 
10,720

 
52,748

 
42,042

General and administrative
 
6,511

 
6,433

 
25,072

 
25,822

Total operating expenses
 
27,227

 
22,733

 
101,698

 
90,523

Income (loss) from operations
 
1,210

 
(2,335
)
 
(6,542
)
 
(21,150
)
Other income (expense), net:
 
 
 
 
 
 
 
 
Interest expense
 
(869
)
 
(1,198
)
 
(4,226
)
 
(4,727
)
Interest income and other
 
54

 
28

 
(12
)
 
100

Extinguishment of debt
 

 

 
(1,026
)
 

Total other income (expense), net
 
(815
)
 
(1,170
)
 
(5,264
)
 
(4,627
)
Income (loss) before income taxes
 
395

 
(3,505
)
 
(11,806
)
 
(25,777
)
Provision for (benefit from) income taxes
 
(14
)
 
13

 
54

 
61

Net income (loss)
 
$
409

 
$
(3,518
)
 
$
(11,860
)
 
$
(25,838
)
Net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$
0.01

 
$
(0.07
)
 
$
(0.23
)
 
$
(0.52
)
Diluted
 
$
0.01

 
$
(0.07
)
 
$
(0.23
)
 
$
(0.52
)
Shares used in computing net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
53,126

 
50,764

 
52,342

 
50,141

Diluted
 
56,633

 
50,764

 
52,342

 
50,141




7


FIVE9, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
 
(Unaudited)
 
 
Cash flows from operating activities:
 
 
 
 
Net loss
 
$
(11,860
)
 
$
(25,838
)
Adjustments to reconcile net loss to net cash used in operating activities:
 
 
 
 
Depreciation and amortization
 
8,390

 
7,388

Provision for doubtful accounts
 
75

 
171

Stock-based compensation
 
9,643

 
7,730

Loss on disposal of property and equipment
 
1

 
10

Amortization of debt discount and issuance costs
 
241

 
350

Changes in fair value of convertible preferred and common stock warrant liabilities
 

 

Loss on extinguishment of debt
 
1,026

 

Reversal of accrued federal fees
 
(3,114
)
 

Accretion of interest
 
20

 

Others
 
(11
)
 
36

Changes in operating assets and liabilities:
 
 
 
 
Accounts receivable
 
(3,389
)
 
(2,410
)
Prepaid expenses and other current assets
 
(859
)
 
(224
)
Other assets
 
203

 
(312
)
Accounts payable
 
811

 
(1,610
)
Accrued and other current liabilities
 
2,262

 
426

Accrued federal fees and sales tax liability
 
(182
)
 
441

Deferred revenue
 
3,680

 
1,038

Other liabilities
 
(99
)
 
(135
)
Net cash provided by (used in) operating activities
 
6,838

 
(12,939
)
Cash flows from investing activities:
 
 
 
 
Purchases of property and equipment
 
(1,131
)
 
(1,116
)
Purchases of privately-held company securities
 
(1,206
)
 

Decrease (increase) in restricted cash
 
(60
)
 
806

Purchase of short-term investments
 

 
(20,000
)
Proceeds from maturity of short-term investments
 

 
40,000

Net cash provided by (used in) investing activities
 
(2,397
)
 
19,690

Cash flows from financing activities:
 
 
 
 
Proceeds from revolving line of credit
 
32,594

 

Repayments on revolving line of credit
 
(12,500
)
 

Payment of prepayment penalty and related fees
 
(368
)
 

Payments for debt issuance costs
 
(206
)
 

Proceeds from exercise of common stock options and warrants
 
4,286

 
1,266

Proceeds from sale of common stock under ESPP
 
1,979

 
1,369

Repayments of notes payable
 
(24,351
)
 
(3,447
)
Payments of capital leases
 
(6,237
)
 
(5,744
)
Net cash provided by (used in) financing activities
 
(4,803
)
 
(6,556
)
Net increase in cash and cash equivalents
 
(362
)
 
195

Cash and cash equivalents:
 
 
 
 
Beginning of period
 
58,484

 
58,289

End of period
 
$
58,122

 
$
58,484


8


FIVE9, INC.
RECONCILIATION OF GAAP GROSS PROFIT TO ADJUSTED GROSS PROFIT
(Unaudited, in thousands)
 
 
Three Months Ended
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
December 31, 2016
 
December 31, 2015
 
 
 
 
 
 
 
 
 
GAAP gross profit
 
$
28,437

 
$
20,398

 
$
95,156

 
$
69,373

GAAP gross margin
 
64.3
%
 
56.6
%
 
58.7
%
 
53.8
%
Non-GAAP adjustments:
 
 
 
 
 
 
 
 
Depreciation
 
1,521

 
1,396

 
6,221

 
5,599

Intangibles amortization
 
87

 
87

 
352

 
351

Stock-based compensation
 
424

 
227

 
1,375

 
866

Reversal of accrued federal fees
 
(3,114
)
 

 
(3,114
)
 

Adjusted gross profit
 
$
27,355

 
$
22,108

 
$
99,990

 
$
76,189

Adjusted gross margin
 
61.9
%
 
61.4
%
 
61.7
%
 
59.1
%


RECONCILIATION OF GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA
(Unaudited, in thousands)
 
 
Three Months Ended
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
December 31, 2016
 
December 31, 2015
 
 
 
 
 
 
 
 
 
GAAP net income (loss)
 
$
409

 
$
(3,518
)
 
$
(11,860
)
 
$
(25,838
)
Non-GAAP adjustments:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
2,086

 
1,863

 
8,390

 
7,388

Stock-based compensation
 
2,716

 
1,720

 
9,643

 
7,730

Interest expense
 
869

 
1,198

 
4,226

 
4,727

Extinguishment of debt
 

 

 
1,026

 

Interest income and other
 
(54
)
 
(28
)
 
13

 
(100
)
Provision for (benefit from) income taxes
 
(14
)
 
13

 
54

 
61

Reversal of accrued federal fees (COR)
 
(3,114
)
 

 
(3,114
)
 

Out of period adjustment for sales tax liability (G&A)
 

 

 

 
765

Adjusted EBITDA
 
$
2,898

 
$
1,248

 
$
8,378

 
$
(5,267
)


9


FIVE9, INC.
RECONCILIATION OF GAAP OPERATING INCOME (LOSS) TO NON-GAAP OPERATING INCOME (LOSS)
(Unaudited, in thousands, except per share data)
 
 
Three Months Ended
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
December 31, 2016
 
December 31, 2015
 
 
 
 
 
 
 
 
 
GAAP operating income (loss)
 
1,210

 
(2,335
)
 
(6,542
)
 
(21,150
)
Non-GAAP adjustments:
 
 
 
 
 
 
 
 
Stock-based compensation
 
2,716

 
1,720

 
9,643

 
7,730

Intangibles amortization
 
117

 
128

 
503

 
512

Out of period adjustment for sales tax liability (G&A)
 

 

 

 
765

Reversal of accrued federal fees (COR)
 
(3,114
)
 

 
(3,114
)
 

Non-GAAP operating income (loss)
 
929

 
(487
)
 
490

 
(12,143
)

RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS)
(Unaudited, in thousands, except per share data)
 
 
Three Months Ended
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
December 31, 2016
 
December 31, 2015
 
 
 
 
 
 
 
 
 
GAAP net income (loss)
 
$
409

 
$
(3,518
)
 
$
(11,860
)
 
$
(25,838
)
Non-GAAP adjustments:
 
 
 
 
 
 
 
 
Stock-based compensation
 
2,716

 
1,720

 
9,643

 
7,730

Intangibles amortization
 
117

 
128

 
503

 
512

Amortization of debt discount and issuance costs
 
20

 
90

 
241

 
350

Extinguishment of debt
 

 

 
1,026

 

Reversal of accrued federal fees (COR)
 
(3,114
)
 

 
(3,114
)
 

Out of period adjustment for sales tax liability (G&A)
 

 

 

 
765

Non-GAAP net income (loss)
 
$
148

 
$
(1,580
)
 
$
(3,561
)
 
$
(16,481
)
GAAP net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$
0.01

 
$
(0.07
)
 
$
(0.23
)
 
$
(0.52
)
Diluted
 
$
0.01

 
$
(0.07
)
 
$
(0.23
)
 
$
(0.52
)
Non-GAAP net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$

 
$
(0.03
)
 
$
(0.07
)
 
$
(0.33
)
Diluted
 
$

 
$
(0.03
)
 
$
(0.07
)
 
$
(0.33
)
Shares used in computing non-GAAP net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
53,126

 
50,764

 
52,342

 
50,141

Diluted
 
56,633

 
50,764

 
52,342

 
50,141


10


FIVE9, INC.
SUMMARY OF STOCK-BASED COMPENSATION, DEPRECIATION AND INTANGIBLES AMORTIZATION
(Unaudited, in thousands)
 
 
Three Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
 
Stock-Based Compensation
 
Depreciation
 
Intangibles Amortization
 
Stock-Based Compensation
 
Depreciation
 
Intangibles Amortization
 
 
 
 
 
 
 
 
 
 
 
 

Cost of revenue
 
$
424

 
$
1,521

 
$
87

 
$
227

 
$
1,396

 
$
87

Research and development
 
549

 
224

 

 
401

 
140

 

Sales and marketing
 
759

 
29

 
29

 
370

 
25

 
29

General and administrative
 
984

 
195

 
1

 
722

 
174

 
12

Total
 
$
2,716

 
$
1,969

 
$
117

 
$
1,720

 
$
1,735

 
$
128

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Twelve Months Ended
 
 
December 31, 2016
 
December 31, 2015
 
 
Stock-Based Compensation
 
Depreciation
 
Intangibles Amortization
 
Stock-Based Compensation
 
Depreciation
 
Intangibles Amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue
 
$
1,375

 
$
6,221

 
$
352

 
$
866

 
$
5,599

 
$
351

Research and development
 
2,059

 
737

 

 
1,790

 
455

 

Sales and marketing
 
2,363

 
107

 
114

 
1,800

 
92

 
114

General and administrative
 
3,846

 
822

 
37

 
3,274

 
730

 
47

Total
 
$
9,643

 
$
7,887

 
$
503

 
$
7,730

 
$
6,876

 
$
512




11


FIVE9, INC.
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS – GUIDANCE
(Unaudited, in thousands, except per share data)
 
 
Three Months Ending
 
Year Ending
 
 
March 31, 2017
 
December 31, 2017
 
 
Low
 
High
 
Low
 
High
 
 
 
 
 
 
 
 
 
GAAP net loss
 
$
(5,250
)
 
$
(6,250
)
 
$
(17,332
)
 
$
(20,332
)
Non-GAAP adjustments:
 
 
 
 
 
 
 
 
Stock-based compensation
 
3,414

 
3,414

 
15,286

 
15,286

Intangibles amortization
 
116

 
116

 
465

 
465

Amortization of debt issuance costs
 
20

 
20

 
81

 
81

Non-GAAP net loss
 
$
(1,700
)
 
$
(2,700
)
 
$
(1,500
)
 
$
(4,500
)
GAAP net loss per share, basic and diluted
 
$
(0.10
)
 
$
(0.12
)
 
$
(0.32
)
 
$
(0.38
)
Non-GAAP net loss per share, basic and diluted
 
$
(0.03
)
 
$
(0.05
)
 
$
(0.03
)
 
$
(0.08
)
Shares used in computing GAAP and non-GAAP net loss per share:
 
 
 
 
 
 
 
 
Basic and diluted
 
53,500

 
53,500

 
53,800

 
53,800




12


Investor Relations Contact:

Five9, Inc.
Barry Zwarenstein
Chief Financial Officer
925-201-2000 ext. 5959
IR@five9.com

The Blueshirt Group for Five9, Inc.
Lisa Laukkanen
415-217-4967
Lisa@blueshirtgroup.com
Tony Righetti
415-489-2186
Tony@blueshirtgroup.com


# # #


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