• Cash, Cash Equivalents and Short-Term Bank Deposit of $67.6 million and No Debt 
• Reiterating 2018 revenue guidance of $33-$35 million 

 

TEL AVIV, Israel – November 7, 2018 − RADCOM Ltd. (NASDAQ: RDCM), today reported its financial results for the third quarter ended September 30, 2018.

“RADCOM continues to be a leading player in Network Function Virtualization. We are delivering successfully on our project commitments and operators continue to benefit from our advanced cloud-native technology” commented Mr. Yaron Ravkaie, RADCOM’s CEO. “The Company continues to support its existing customers, advance its R&D activities, and focus its sales efforts on top-tier operators.  Our strong balance sheet enables our continued investment in innovative technology designed to meet the needs of our leading clients and the forthcoming transition to NFV and 5G.”

 

Third Quarter 2018 Financial Highlights:

• Revenues: Total revenues for the third quarter were $8.5 million, down 12% compared to $9.6 million in the third quarter of 2017

• Net Income: GAAP net income for the period was $0.6 million, or $0.05 per diluted share, compared to GAAP net income of $1.2 million, or $0.10 per diluted share for the third quarter of 2017

• Non-GAAP Net Income: Non-GAAP net income for the period was $1.0 million, or $0.07 per diluted share, compared to non-GAAP net income of $1.7 million, or $0.14 per diluted share for the third quarter of 2017

 

Both GAAP and non-GAAP results for the third quarter of 2018 included a $528,000, or $0.04 per diluted share, benefit related to grants from the Israel Innovation Authority compared to $155,000, or $0.01 per diluted share, in the third quarter of 2017

 

• Balance sheet: As of September 30, 2018, the Company had cash, cash equivalents and short-term bank deposit of $67.6 million and no debt

 

Earnings Conference Call
RADCOM’s management will hold an interactive conference call today at 8:00 AM Eastern Time (3:00 PM Israel Standard Time) to discuss the results and to answer participants' questions. To join the call, please call one of the following numbers approximately five minutes before the call is scheduled to begin:
 

From the US (toll-free): +1-866-229-7198

From other locations: +972-3-918-0687

 

For those unable to listen to the call at the time, a replay will be available from November 8th on RADCOM's website.

 

###

 

About RADCOM
RADCOM (NASDAQ: RDCM) is the leading expert in cloud-native Network Intelligence for telecom operators transitioning to SDN/NFV. Providing a critical first step in an operator's NFV transformation, RADCOM's Network Intelligence delivers end-to-end network visibility from virtual tapping point to network insights. Comprised of RADCOM Service Assurance, RADCOM Network Visibility and RADCOM Network Insights, RADCOM's Network Intelligence portfolio provides operators with complete visibility across their virtual and hybrid networks. RADCOM Network Intelligence is automated, cost-efficient, and provides on-demand functionality that is specifically designed for the needs of telecom operators. RADCOM specializes in assuring next-generation, high capacity networks, including LTE, Advanced-LTE, 5G, IMS, SDN/NFV and others. For more information on how to RADCOMize your network, today, please visit www.radcom.com, the content of which does not form a part of this press release.

 

Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the reader's overall understanding of the Company’s financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, the Company’s non-GAAP results provide information to both management and investors that is useful in assessing the Company’s core operating performance and in evaluating and comparing the Company’s results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with GAAP.

 

Risks Regarding Forward-Looking Statements 
Certain statements made herein that use words such as “estimate,” “project,” “intend,” “expect,” “'believe”, ”may“, ”might”, “predict”, ”potential”, “anticipate”, “plan” or similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. For example, when the Company discusses its revenue guidance for 2018, continued investment in technology to meet the needs of its clients and transition to NFV as well as success in focusing on sales to top-tier operators, it is using foward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that could cause the actual results, performance or achievements of the Company to be materially different from those that may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in the demand for the Company’s products, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on prices resulting from competition. For additional information regarding these and other risks and uncertainties associated with the Company’s business, reference is made to the Company’s reports filed from time to time with the U.S. Securities and Exchange Commission. The Company does not undertake to revise or update any forward-looking statements for any reason.

 

RADCOM Ltd. 
Consolidated Statement of Operations

(thousands of U.S. dollars, except share and per share data)


 

Three months ended
September 30,

 

Nine months ended
September 30,

 

2018

 

2017

 

2018

 

2017

 

(unaudited)

 

(unaudited)

 

(unaudited)

 

(unaudited)

Revenues

$8,519

 

$9,645

 

$30,061

 

$26,602

Cost of revenues

1,660

 

3,163

 

7,427

 

7,828

Gross profit

6,859

 

6,482

 

22,634

 

18,774

               

Research and development, gross

3,933

 

2,280

 

11,429

 

7,507

Less - royalty-bearing participation

528

 

155

 

1,282

 

467

Research and development, net

3,405

 

2,125

 

10,147

 

7,040

               

Sales and marketing, net

2,401

 

2,333

 

8,725

 

8,219

General and administrative

657

 

991

 

2,647

 

3,149

Total operating expenses

6,463

 

5,449

 

21,519

 

18,408

Operating income

396

 

1,033

 

1,115

 

366

Financial income, net

282

 

175

 

655

 

325

Income before taxes on income

678

 

1,208

 

1,770

 

691

Taxes on income

(44)

 

(25)

 

(57)

 

(48)

               

Net income

$634

 

$1,183

 

$1,713

 

$643

               

Basic net income per ordinary share

$0.05

 

$0.10

 

$0.13

 

$0.05

Diluted net income per ordinary share

$0.05

 

$0.10

 

$0.12

 

$0.05

 

Weighted average number of ordinary shares used

in computing basic net income per ordinary share

13,701,844

 

11,747,443

 

13,600,849

 

11,698,246

 

Weighted average number of ordinary shares used

in computing diluted net income per ordinary share

13,916,306

 

12,070,080

 

13,851,324

 

12,018,658

 

 

RADCOM LTD.
Reconciliation of GAAP to Non-GAAP Financial Information
Unaudited

(thousands of U.S. dollars, except share and per share data)

 

   

Three months ended 

 

Nine months ended    

September 30, 

September 30,

 

2018

 

2017

 

2018

 

2017

GAAP gross profit                   

$6,859

 

$6,482

 

$22,634

 

$18,774

Stock-based compensation

25

 

67

 

102

 

134

Non-GAAP gross profit

$6,884

 

$6,549

 

$22,736

 

$18,908

GAAP research and development, net

$3,405

 

$2,125

 

$10,147

 

$7,040

Stock-based compensation

210

 

97

 

621

 

339

Non-GAAP research and development, net

$3,195

 

$2,028

 

$9,526

 

$6,701

GAAP sales and marketing, net

$2,401

 

$2,333

 

$8,725

 

$8,219

Stock-based compensation

121

 

122

 

583

 

394

Non-GAAP sales and marketing, net

$2,280

 

$2,211

 

$8,142

 

$7,825

GAAP general and administrative

$657

 

$991

 

$2,647

 

$3,149

Stock-based compensation

10

 

200

 

402

 

859

Non-GAAP general and administrative

$647

 

$791

 

$2,245

 

$2,290

GAAP total operating expenses

$6,463

 

$5,449

 

$21,519

 

$18,408

Stock-based compensation

341

 

419

 

1,606

 

1,592

Non-GAAP total operating expenses

$6,122

 

$5,030

 

$19,913

 

$16,816

GAAP operating income

$396

 

$1,033

 

$1,115

 

$366

Stock-based compensation

366

 

486

 

1,708

 

1,726

Non-GAAP operating income

$762

 

$1,519

 

$2,823

 

$2,092

GAAP income before taxes on income

$678

 

$1,208

 

$1,770

 

$691

Stock-based compensation

366

 

486

 

1,708

 

1,726

Non-GAAP income before taxes on income

$1,044

 

$1,694

 

$3,478

 

$2,417

GAAP net income

$634

 

$1,183

 

$1,713

 

$643

Stock-based compensation

366

 

486

 

1,708

 

1,726

Non-GAAP net income

$1,000

 

$1,669

 

$3,421

 

$2,369

GAAP net income per diluted share

$0.05

 

$0.10

 

$0.12

 

$0.05

Stock-based compensation

0.02

 

0.04

 

0.12

 

0.15

Non-GAAP net income per diluted share

$0.07

 

$0.14

 

$0.24

 

$0.20

Weighted average number of shares used to compute diluted net income per share

13,916,306

 

12,070,080

 

13,851,324

 

12,018,658

 

RADCOM Ltd.
Consolidated Balance Sheets

(thousands of U.S. dollars) 

 

 

As of

 

As of

 

September 30,

2018

 

December 31,

2017

 

(unaudited)

   

Current Assets

     

Cash and cash equivalents

$27,576

 

$22,575

Restricted bank deposit

-

 

36

Short-term bank deposit

40,000

 

40,000

Trade receivables, net

18,485

 

20,266

Inventories

350

 

1,199

Other receivables

1,733

 

2,685

Total Current Assets

88,144

 

86,761

Severance pay fund

3,103

 

3,052

Other long-term receivables

302

 

172

Property and equipment, net

1,841

 

1,924

       

Total Assets

$93,390

 

$91,909

       

Liabilities and Shareholders' Equity

     

Current Liabilities

     

Trade payables

$1,539

 

$1,828

Deferred revenues

811

 

2,601

Employee and payroll accruals

3,403

 

4,062

Other payables and accrued expenses

1,796

 

3,428

Total Current Liabilities

7,549

 

11,919

Long-Term Liabilities

     

Deferred revenues

100

 

21

Accrued severance pay       

3,600

 

3,573

Total Long-Term Liabilities

3,700

 

3,594

       

Total Liabilities

$11,249

 

$15,513

       

Shareholders' Equity

     

Share capital

$642

 

$628

Additional paid-in capital

135,274

 

131,491

Accumulated other comprehensive loss

(2,622)

 

(2,520)

Accumulated deficit

(51,153)

 

(53,203)

       

Total Shareholders' Equity

82,141

 

76,396

Total Liabilities and Shareholders' Equity

$93,390

 

 

 

 

For all investor enquiries, please contact:

Investor Relations:
Miri Segal
MS-IR LLC
917-607-8654
msegal@ms-ir.com


Company Contact:
Amir Hai 
CFO
+972-77-774-5011
amir.hai@radcom.com