NETSUITE ANNOUNCES SECOND QUARTER 2014 FINANCIAL RESULTS
First Pure-Play Cloud ERP Software-as-a-Service Company to Exceed Half a Billion Annual Revenue Run Rate
First Ever $100 Million Quarter of Recurring Revenue
- Q2 Revenue of $131.8 Million, a 30% Year-over-Year Increase
- Q2 Operating Cash Flows of $18.6 Million, a 19% Year-over-Year Increase
SAN MATEO, Calif.—July 24, 2014—NetSuite Inc. (NYSE: N), the industry's leading provider of cloud-based
financials / ERP and omnichannel commerce software suites, today announced results for its second
quarter ended June 30, 2014.
Total revenue for the second quarter of 2014 was $131.8 million, representing a 30% increase over the
same period in the prior year.
Cash flows from operations were $18.6 million in the second quarter of 2014, up from $15.6 million in
the same period in the prior year.
On a GAAP basis, net loss for the second quarter of 2014 was $23.2 million, or $(0.31) per share, as
compared to a net loss of $20.4 million, or $(0.28) per share, in the second quarter of 2013.
Non-GAAP net income for the second quarter of 2014 was $4.8 million, or $0.06 per share, as compared
to non-GAAP net income of $4.0 million, or $0.05 per share, in the second quarter of 2013.
"NetSuite delivered record second quarter revenues, growing year-over-year by 30 percent for the eighth
consecutive quarter. We also reported our first-ever $100 million quarter of recurring revenue signaling a
break out moment. NetSuite's leadership in cloud ERP has never been more clear," said NetSuite CEO
In conjunction with this announcement, NetSuite will host a conference call at 2:00 p.m. PDT (5:00 p.m.
EDT) today to discuss our second quarter 2014 financial results and our outlook for the third quarter of
2014 and full year 2014. A live audio webcast and replay of the call, together with detailed financial
information, will be available in the Investor Relations section of NetSuite's website at www.netsuite.com/
investors. The live call can be accessed by dialing 855-812-1881 (U.S.) or 817-385-7868 (outside the
U.S.) and referencing passcode: 74179530. A replay of the call can also be accessed by dialing
855-859-2056 (U.S.) or 404-537-3406 (outside the U.S.), and referencing passcode: 74179530.
NetSuite Inc. is the industry's leading provider of cloud-based financials / Enterprise Resource Planning
(ERP) and omnichannel commerce software suites. In addition to financials/ERP and omnichannel
commerce software suites, NetSuite offers a broad suite of applications, including financial management,
Customer Relationship Management (CRM), ecommerce and retail management, Professional Services
Automation (PSA) and Human Capital Management (HCM) that enable companies to manage most of
their core business operations in its single integrated suite. NetSuite software allows businesses to
automate operations, streamline processes and access real-time business information anytime, anywhere.
For more information about NetSuite, please visit www.netsuite.com.
Cautionary Note Regarding Forward-Looking Statements
This press release and NetSuite's scheduled conference call contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934 relating to, among other things, expectations, plans, prospects and financial results for NetSuite,
including, but not limited to, our expectations regarding our products, market demand, future earnings,
revenue and market share growth. These forward-looking statements are based upon the current
expectations and beliefs of NetSuite's management as of the date of this press release and conference call,
and are subject to certain risks and uncertainties that could cause actual results to differ materially from
those described in the forward-looking statements. All forward-looking statements made in this press
release and during the conference call are based on information available to us as of the date thereof, and
NetSuite disclaims any obligation to update these forward-looking statements.
In particular, the following factors, among others, could cause results to differ materially from those
expressed or implied by such forward-looking statements: the market for on-demand services may
develop more slowly than expected or than it has in the past; adverse and unpredictable macro-economic
conditions or reduced investments in on-demand applications and information technology spending;
quarterly operating results may fluctuate more than expected; unexpected disruptions of service at one or
more of our data centers may occur; a security breach may impact operations; risks associated with
material defects or errors in our software or the effect of undetected computer viruses could impact
operations; the risk of technological developments and innovations by others; our ability to successfully
identify other businesses and technologies for acquisition that will complement our business and the
ability to successfully acquire and integrate those businesses and technologies; the risk of loss of power or
disruption in Internet service; failure to manage growth and effectively scale the organization; failure to
protect and enforce our intellectual property rights; assertions by third parties that we infringe their
intellectual property rights; the ability to manage operations when faced with competitive pricing and
marketing strategies by competitors or changing macro-economic conditions; the risk of losing key
employees; evolving government regulation of the Internet and ecommerce; changes to current accounting
rules; changes in foreign exchange rates; and general political or destabilizing events, including war,
conflict or acts of terrorism; and other risks and uncertainties.
Customers who purchase our services should make sure the decisions are based on features that are
currently available. Please be advised that any unreleased services or features from NetSuite referenced in
today's discussion or other public statements are not currently available and may not be delivered on time
or at all.
For a detailed discussion of these and other cautionary statements, please refer to the risk factors
discussed in filings with the U.S. Securities and Exchange Commission ("SEC"), including but not limited
to our Annual Report on Form 10-K filed on March 3, 2014, our Quarterly Report on Form 10-Q filed on
May 6, 2014 and any subsequently filed reports on Forms 10-K, 10-Q and 8-K. All documents are
available through the SEC's Electronic Data Gathering Analysis and Retrieval system ("EDGAR") at
www.sec.gov or NetSuite's website at www.netsuite.com.
Non-GAAP Financial Measures
Our stated results include certain non-GAAP financial measures, including non-GAAP operating income,
net income, weighted average shares outstanding, and net income per share. Non-GAAP operating
income excludes expenses related to stock-based compensation expense, amortization of intangible assets,
and transaction costs for business combinations. Non-GAAP net income excludes expenses related to
stock-based compensation expense, amortization of intangible assets, transaction costs for business
combinations, non-cash interest expense on convertible debt and income tax benefits associated with
business combination. Non-GAAP operating income and non-GAAP net income exclude these expenses
as they are often excluded by other companies to help investors understand the operational performance of
their business, and in the case of stock-based compensation, can be difficult to predict. We believe these
adjustments provide useful comparative information to investors.
We consider these non-GAAP financial measures to be important because they provide useful measures of
our operating performance and are used by our management for that purpose. In addition, investors often
use measures such as these to evaluate the operating performance of a company. Non-GAAP results are
presented for supplemental informational purposes only for understanding our operating results. The non-
GAAP results should not be considered a substitute for financial information presented in accordance with
generally accepted accounting principles, and may be different from non-GAAP measures used by other
A copy of this press release can be found on our Investor Relations website at www.netsuite.com/
investors. The contents of the website are not incorporated by reference into this press release.
Click here to download the press release, financial tables and non-GAAP reconciliation.
NOTE: NetSuite and the NetSuite logo are service marks of NetSuite Inc.