SOURCE: Pegasystems
August 09, 2010 16:35 ET
Pegasystems Announces Twelfth Consecutive Quarter of Record Revenue
GAAP Revenue Increases 29% to $82.2 Million, Non-GAAP Revenue Increases 34% to $85.8 Million
CAMBRIDGE, MA--(Marketwire - August 9, 2010) - Pegasystems Inc. (NASDAQ: PEGA) today
announced financial results for the second quarter and six months ended
June 30, 2010. These results include the operations of Chordiant Software,
Inc. from the April 21, 2010 acquisition date. GAAP revenue for the second
quarter of 2010 increased 29% to $82.2 million compared to the second
quarter of 2009, while non-GAAP revenue increased 34% to $85.8 million.
GAAP net loss for the second quarter of 2010 was $8.2 million or ($0.22)
per share, primarily attributable to restructuring and acquisition charges
of $9.5 million for Chordiant as well as a foreign exchange loss of $2.5
million, compared to GAAP net income of $11.2 million, or $0.30 per share
(diluted), for the second quarter of 2009. Non-GAAP net income was $3.8
million, or $0.10 per share (diluted), for the second quarter of 2010.
Total GAAP revenue for the first six months of 2010 increased 25% to $157.3
million while non-GAAP revenue of $160.9 million increased 27%, compared to
the same period last year.
Business Perspective
"During the second quarter of 2010, we had a record number of global client
go-lives across industries including insurance, financial services,
healthcare, government, and travel services," said Alan Trefler, Founder
and CEO of Pegasystems. "We were thrilled to see many clients at our April
PegaWORLD conference sharing how our Build for Change® technology is
transforming the way they work and helping them succeed. In addition, a
leading industry analyst firm recognized us as a market leader in CRM
Customer Service Contact Centers during the quarter."
"In the first half of 2010, we executed on our plan to invest in expanding
our account and geographic coverage to facilitate growth as we end 2010 and
move into 2011. Another key growth strategy is adding new vertical
frameworks where we anticipate our solutions can deliver rapid returns to
our clients and in the second quarter we announced new offerings in life
sciences and communications. Our investment in Global Alliances is showing
great promise, with Accenture, Amazon, Capgemini, and IBM, participating as
key sponsors at PegaWORLD 2010," concluded Mr. Trefler.
Craig Dynes, Pegasystems' CFO added "So far, 2010 has been a year of large
investments, of which the acquisition of Chordiant was a primary focus. We
are very much on track with the integration of operations, systems, and
staff, setting the stage for product and sales strategy to drive revenue
synergy in 2011."
"Additionally, we made significant investments in our sales organization,
adding 89 sales reps and related sales support in the first half of 2010.
We anticipate this investment, along with our investments in expanding our
vertical market offerings and partner ecosystems will position us for
strong growth in 2011. You should note that our guidance in February
assumed a stable U.S. dollar, but currencies have been far from stable. The
weakness in the Euro and the British pound resulted in a foreign exchange
loss of $2.5 million, or ($0.05) per share in this quarter, and $5.6
million, or ($0.13) per share for the first half of the year. These foreign
exchange losses do not impact our progress towards our strategic
objectives," continued Mr. Dynes.
"Given the foreign exchange losses, and with our purchase accounting
charges calculated, we are able to provide guidance for the full year
ending December 31, 2010 on a GAAP and non-GAAP basis. We estimate that our
total GAAP revenues will be approximately $348 million. Non-GAAP revenues
are estimated to be approximately $360 million, including $12 million of
revenue impacted by purchase accounting. We estimate that our GAAP diluted
earnings per share will be approximately $0.30 per share. Non-GAAP diluted
earnings per share is estimated to be approximately $1.02 per share,
including approximately $12 million of revenue impacted by purchase
accounting, pretax expense of $12.7 million for restructuring and
acquisition related expenses, as well as $7.7 million of amortization
expenses related to the acquisition of Chordiant, and $5.9 million of
equity based compensation charges. The effective tax rate for 2010 is
estimated at 33%," concluded Mr. Dynes.
Messrs. Trefler and Dynes will be hosting a conference call and live
Webcast associated with this announcement at 9:00 a.m. EDT on August 10,
2010. Dial-in information is as follows: 1 (877) 638-9568 (domestic) or 1
(914) 495-8529 (international). To listen to the Webcast
log onto www.pega.com at least 5 minutes prior to the event's broadcast and
click on the Webcast icon in the Investor
Relations section. A replay of the call will also be available on
www.pega.com in the Investor Relations section Audio Archives link.
Discussion of Non-GAAP Measures
To supplement financial results presented on a GAAP basis, the Company
provides non-GAAP measures included in this release, including the tables
contained herein. Pegasystems' management utilizes a number of different
financial measures, both GAAP and non-GAAP, in analyzing and assessing the
overall performance of the business, for making operating decisions, and
for forecasting and planning for future periods. The Company's annual
financial plan is prepared both on a GAAP and non-GAAP basis, and the
non-GAAP annual financial plan is approved by our board of directors. In
addition and as a consequence of the importance of these measures in
managing the business, the Company uses non-GAAP measures and results in
the evaluation process to establish management's compensation.
These measures exclude certain business combination accounting entries and
expenses related to our acquisition of Chordiant, as well as other
significant expenses including stock-based compensation. The Company
believes that these non-GAAP measures are helpful in understanding our past
financial performance and our anticipated future results. These non-GAAP
financial measures are not meant to be considered in isolation or as a
substitute for comparable GAAP measures and should be read only in
conjunction with our consolidated financial statements prepared in
accordance with GAAP. A reconciliation of the Company's GAAP measures to
non-GAAP measures is included in the financial information at the end of
the release.
Forward-Looking Statements
Certain statements contained in this press release may be construed as
"forward-looking statements" as defined in the Private Securities
Litigation Reform Act of 1995, including those relating to our growth,
revenue, net income and net income per share, and financial guidance. The
words "anticipate," "project," "expect," "plan," "intend," "believe,"
"estimate," "target," "forecast," "could," "preliminary," "guidance" and
similar expressions, among others, identify forward-looking statements,
which speak only as of the date the statement was made. These statements
are based on current expectations and assumptions and involve various risks
and uncertainties, which could cause the Company's actual results to differ
from those expressed in such forward-looking statements. These risks and
uncertainties include, among others, the Company's ability to successfully
integrate the operations of Chordiant Software, Inc., variation in demand
for our products and services and the difficulty in predicting the
completion of product acceptance and other factors affecting the timing of
our license revenue recognition, the mix of perpetual and term licenses and
the level of term license renewals, our ability to develop new products and
evolve existing ones, the weak global economy and the ongoing consolidation
in the financial services and healthcare markets, our ability to attract
and retain key personnel, reliance on key third party relationships, the
potential loss of vendor specific objective evidence for our professional
services, and management of the Company's growth. Further information
regarding these and other factors which could cause the Company's actual
results to differ materially from any forward-looking statements contained
in this press release is contained in the Company's Annual Report on Form
10-K for the year ended December 31, 2009 and other recent filings with the
Securities and Exchange Commission. The forward-looking statements
contained in this press release represent the Company's views as of August
9, 2010. Investors are cautioned not to place undue reliance on such
forward-looking statements and there are no assurances that the matters
contained in such statements will be achieved. Although subsequent events
may cause the Company's view to change, the Company does not undertake and
specifically disclaims any obligation to publicly update or revise these
forward-looking statements whether as the result of new information, future
events or otherwise. The statements should therefore not be relied upon as
representing the Company's view as of any date subsequent to August 9,
2010.
About Pegasystems
Pegasystems, the leader in business process management and a leading
provider of CRM solutions, helps organizations enhance customer loyalty,
generate new business, and improve productivity. Our patented Build for
Change® technology speeds the delivery of critical business solutions by
directly capturing business objectives and eliminating manual programming.
Pegasystems enables clients to quickly adapt to changing business
conditions in order to outperform the competition. For more information,
please visit us at www.pega.com.
Pegasystems Inc.
Unaudited Condensed Consolidated Statements of Operation
In thousands, except per share amounts
Three Months
Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
------- -------- ------- --------
Revenue:
Software license $28,200 $ 25,651 $58,543 $ 53,687
Maintenance 20,388 12,171 35,474 24,119
Professional services 33,658 26,056 63,313 48,439
------- -------- ------- --------
Total revenue 82,246 63,878 157,330 126,245
------- -------- ------- --------
Cost of revenue:
Cost of software license 1,109 31 1,140 62
Cost of maintenance 2,715 1,457 4,652 2,894
Cost of professional services 27,436 20,104 51,904 39,167
------- -------- ------- --------
Total cost of revenue (1) 31,260 21,592 57,696 42,123
------- -------- ------- --------
Gross profit 50,986 42,286 99,634 84,122
------- -------- ------- --------
Operating expenses:
Selling and marketing 29,896 16,659 51,789 32,095
Research and development 14,010 9,149 25,636 18,268
General and administrative 6,745 4,648 11,804 9,594
Acquisition-related 3,395 - 4,903 -
Restructuring costs 6,080 - 6,080 -
------- -------- ------- --------
Total operating expenses (1) 60,126 30,456 100,212 59,957
------- -------- ------- --------
(Loss) income from operations (9,140) 11,830 (578) 24,165
Foreign currency transaction (loss)
gain (2,542) 2,923 (5,616) 2,111
Interest income, net 119 881 632 1,683
Installment receivable interest income 52 75 104 150
Other income, net 1 7 242 17
------- -------- ------- --------
(Loss) income before (benefit)
provision for income taxes (11,510) 15,716 (5,216) 28,126
(Benefit) provision for income taxes (3,322) 4,475 (879) 8,243
------- -------- ------- --------
Net (loss) income $(8,188) $ 11,241 $(4,337) $ 19,883
======= ======== ======= ========
Net (loss) earnings per share:
Basic $ (0.22) $ 0.31 $ (0.12) $ 0.56
======= ======== ======= ========
Diluted $ (0.22) $ 0.30 $ (0.12) $ 0.53
======= ======== ======= ========
Weighted-average number of common
shares outstanding:
Basic 37,054 35,965 36,966 35,818
Diluted 37,054 37,995 36,966 37,708
Dividends per share $ 0.03 $ 0.03 $ 0.06 $ 0.06
======= ======== ======= ========
(1) Includes stock-based compensation
as follows:
Cost of revenue $ 483 $ 128 $ 881 $ 634
Operating expenses $ 1,703 $ 732 $ 2,751 $ 1,924
PEGASYSTEMS INC
Q2 FISCAL 2010 FINANCIAL RESULTS
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1)
($ in thousands, except per share data)
Three Months Ended June 30,
----------------------------------------------------
2010 2010 2009 2009
GAAP Adj. Non-GAAP GAAP Adj. Non-GAAP
-------- -------- ------- ------- ----- -------
TOTAL REVENUES (2) (3)
(4) $ 82,246 $ 3,593 $85,839 $63,878 $ - $63,878
Software license (2) 28,200 1,059 29,259 25,651 - 25,651
Maintenance (3) 20,388 2,422 22,810 12,171 - 12,171
Professional
services (4) 33,658 112 33,770 26,056 - 26,056
TOTAL COST OF REVENUES
(5) (6) $ 31,260 $ (1,531) $29,729 $21,592 $(128) $21,464
Amortization of
intangible assets
(5) 1,079 (1,048) 31 31 - 31
Stock-based
compensation (6) 483 (483) - 128 (128) -
TOTAL OPERATING
EXPENSES (5) (6) $ 60,126 $(12,067) $48,059 $30,456 $(732) $29,724
Amortization of
intangible assets
(5) 894 (889) 5 5 - 5
Stock-based
compensation (6) 1,703 (1,703) - 732 (732) -
Acquisition related 3,395 (3,395) - - - -
Restructuring costs 6,080 (6,080) - - - -
OPERATING INCOME
(LOSS) $ (9,140) $ 17,191 $ 8,051 $11,830 $ 860 $12,690
OPERATING MARGIN % -11.11% 9.38% 18.52% 19.87%
INCOME TAX EFFECTS(7) $ (3,322) $ 5,208 $ 1,886 $ 4,475 $ 245 $ 4,720
NET INCOME $ (8,188) $ 11,983 $ 3,795 $11,241 $ 615 $11,856
DILUTED EARNINGS PER
SHARE $ (0.22) $ 0.10 $ 0.30 $ 0.31
DILUTED WEIGHTED
AVERAGE COMMON
SHARES OUTSTANDING 37,054 - 37,054 37,995 - 37,995
% Increase
(Decrease)
-------------------
GAAP Non-GAAP
-------- ----------
TOTAL REVENUES (2) (3)
(4) 29% 34%
Software license (2) 10% 14%
Maintenance (3) 68% 87%
Professional
services (4) 29% 30%
TOTAL COST OF REVENUES
(5) (6) 45% 39%
Amortization of
intangible assets
(5) n/m 0%
Stock-based
compensation (6) 277% 0%
TOTAL OPERATING
EXPENSES (5) (6) 97% 62%
Amortization of
intangible assets
(5) n/m 0%
Stock-based
compensation (6) 133% 0%
Acquisition related 100% 0%
Restructuring costs 100% 0%
OPERATING INCOME
(LOSS) -177% -37%
OPERATING MARGIN % (0.2963)bp (0.1049)bp
INCOME TAX EFFECTS (7) -174% -60%
NET INCOME -173% -68%
DILUTED EARNINGS PER
SHARE -173% -68%
DILUTED WEIGHTED
AVERAGE COMMON
SHARES OUTSTANDING -2% -2%
n/m - not meaningful
PEGASYSTEMS INC
Q2 FISCAL 2010 YEAR TO DATE FINANCIAL RESULTS
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1)
($ in thousands, except per share data)
Six Months Ended June 30,
---------------------------------------------------------
2010 2010 2009 2009
GAAP Adj. Non-GAAP GAAP Adj. Non-GAAP
-------- -------- -------- -------- ------- --------
TOTAL REVENUES
(2) (3) (4) $157,330 $ 3,593 $160,923 $126,245 $ - $126,245
Software
license (2) 58,543 1,059 59,602 53,687 - 53,687
Maintenance (3) 35,474 2,422 37,896 24,119 - 24,119
Professional
services (4) 63,313 112 63,425 48,439 - 48,439
TOTAL COST OF
REVENUES (5) (6)$ 57,696 $ (1,929) $ 55,767 $ 42,123 $ (634) $ 41,489
Amortization of
intangible
assets (5) 1,110 (1,048) 62 61 - 61
Stock-based
compensation
(6) 881 (881) - 634 (634) -
TOTAL OPERATING
EXPENSES (5) (6)$100,212 $(14,623) $ 85,589 $ 59,957 $(1,924) $ 58,033
Amortization of
intangible
assets (5) 899 (889) 10 10 - 10
Stock-based
compensation
(6) 2,751 (2,751) - 1,924 (1,924) -
Acquisition
related 4,903 (4,903) - - - -
Restructuring
costs 6,080 (6,080) - - - -
OPERATING INCOME
(LOSS) $ (578) $ 20,145 $ 19,567 $ 24,165 $ 2,558 $ 26,723
OPERATING MARGIN
% 0% 12% 19% 21%
INCOME TAX
EFFECTS (7) $ (879) $ 5,895 $ 5,016 $ 8,243 $ 749 $ 8,992
NET INCOME $ (4,337) $ 14,250 $ 9,913 $ 19,883 $ 1,809 $ 21,692
DILUTED EARNINGS
PER SHARE $ (0.12) $ 0.27 $ 0.53 $ 0.58
DILUTED WEIGHTED
AVERAGE COMMON
SHARES
OUTSTANDING 36,966 - 36,966 37,708 - 37,708
% Increase
(Decrease)
---------------------
GAAP Non-GAAP
-------- --------
TOTAL REVENUES
(2) (3) (4) 25% 27%
Software
license (2) 9% 11%
Maintenance (3) 47% 57%
Professional
services (4) 31% 31%
TOTAL COST OF
REVENUES (5) (6) 37% 34%
Amortization of
intangible
assets (5) n/m 2%
Stock-based
compensation
(6) 39% 0%
TOTAL OPERATING
EXPENSES (5) (6) 67% 47%
Amortization of
intangible
assets (5) n/m 0%
Stock-based
compensation
(6) 43% 0%
Acquisition
related 100% 0%
Restructuring
costs 100% 0%
OPERATING INCOME
(LOSS) -102% -27%
OPERATING MARGIN
% (0.1951) bp (0.0901) bp
INCOME TAX
EFFECTS (7) -111% -44%
NET INCOME -122% -54%
DILUTED EARNINGS
PER SHARE -123% -53%
DILUTED WEIGHTED
AVERAGE COMMON
SHARES
OUTSTANDING -2% -2%
n/m - not meaningful
PEGASYSTEMS INC
FOOTNOTES FOR RECONCILIATON OF
SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are
not meant to be considered in isolation or as a substitute for
comparable GAAP measures, and should be read only in conjunction with
our consolidated financial statements prepared in accordance with GAAP.
For a detailed explanation of the adjustments made to comparable GAAP
measures, the reasons why management uses these measures, the
usefulness of these measures, and the material limitations on the
usefulness of these measures, see disclosure under Discussion of
Non-GAAP measures included earlier in this release and below.
Our non-GAAP financial measures reflect adjustments based on the
following items, as well as the related income tax effects:
Revenue: Business combination rules require that we determine the fair
value of the deferred revenue liability for contractual obligations
assumed from Chordiant. The fair value represents an amount equal to
the estimated costs of fulfilling the assumed contracts plus a
reasonable profit margin. In post-acquisition reporting periods, we
recognize revenue for the fair value of these contracts, when all the
revenue recognition criteria are satisfied, instead of the revenue that
would have been recognized by Chordiant as an independent company. We
add back the affect of the deferred revenue fair value adjustment in
non-GAAP revenue to reflect the full amount of these revenues to
provide a more complete comparison of the revenue guidance to peer
companies.
Stock-based compensation expenses: We have excluded the effect of
stock-based compensation expenses from our non-GAAP operating expenses
and net income measures. Although stock-based compensation is a key
incentive offered to our employees, and we believe such compensation
contributed to the revenues earned during the periods presented and
also believe it will contribute to the generation of future period
revenues, we continue to evaluate our business performance excluding
stock-based compensation expense.
Amortization of intangible assets: We have excluded the effect of
amortization of intangible assets acquired from Chordiant from our
non-GAAP operating expenses and net income measures. Amortization of
intangible assets is inconsistent in amount and frequency and is
significantly affected by the timing and size of our acquisitions.
Investors should note that the use of intangible assets contributed to
our revenues earned during the periods presented and will contribute to
our future period revenues as well. Amortization of intangible assets
will recur in future periods.
Acquisition related expenses and restructuring expenses: We have
excluded the effect of acquisition related expenses and restructuring
expenses from our non-GAAP operating expenses and net income measures.
We incurred direct and incremental costs to effect our acquisitions and
costs associated with the Chordiant acquisition. We have also incurred
restructuring expenses related to the integration of the acquisition,
which we generally would not have otherwise incurred in the periods
presented as a part of our continuing operations. Restructuring
expenses consist of employee severance and other exit costs. We believe
it is useful for investors to understand the effects of these items on
our total operating expenses.
(2) As of April 20, 2010, approximately $4.0 million, $0.6 million, $0.5
million and $0.2 million in estimated revenues related to assumed
software license contracts will not be recognized for the remainder of
fiscal 2010, fiscal 2011, fiscal 2012 and fiscal 2013, respectively,
due to business combination accounting rules.
(3) As of April 20, 2010, approximately $7.3 million, $3.0 million and
$0.5 million in estimated revenues related to assumed software support
contracts will not be recognized for the remainder of fiscal 2010,
fiscal 2011 and fiscal 2012, respectively, due to business combination
accounting rules.
(4) As of April 20, 2010, approximately $0.3 million, $0.3 million, $0.3
million and $0.1 million in estimated revenues related to assumed
software installation services contracts will not be recognized for the
remainder of fiscal 2010, fiscal 2011, fiscal 2012 and fiscal 2013,
respectively, due to business combination accounting rules.
(5) Estimated future annual amortization expense related to intangible
assets as of June 30, 2010 is as follows:
Remainder of Fiscal 2010 $ 5,810
Fiscal 2011 11,453
Fiscal 2012 11,370
Fiscal 2013 11,370
Fiscal 2014 9,746
Fiscal 2015 8,934
Thereafter 29,780
------------
Total intangible assets subject to amortization $ 88,463
============
(6) Stock-based compensation is included in the following GAAP operating
expense categories:
Three Months Ended Three Months Ended
June 30, 2010 June 30, 2009
-------------------------- -------------------------
GAAP Adj. Non-GAAP GAAP Adj. Non-GAAP
-------- ------- -------- ------- ------- --------
Cost of revenue $ 483 $ (483) $ - $ 128 $ (128) $ -
Selling and marketing 657 (657) - (19) 19 -
Research and
development 275 (275) - 141 (141) -
General and
administrative 771 (771) - 610 (610) -
-------- ------- -------- ------- ------- --------
Total stock-based
compensation $ 2,186 $(2,186) $ - $ 860 $ (860) $ -
-------- ------- -------- ------- ------- --------
Six Months Ended Six Months Ended
June 30, 2010 June 30, 2009
-------------------------- --------------------------
GAAP Adj. Non-GAAP GAAP Adj. Non-GAAP
-------- ------- -------- -------- ------- --------
Cost of revenue $ 881 $ (881) $ - $ 634 $ (634) $ -
Selling and marketing 1,074 (1,074) - 351 (351) -
Research and
development 513 (513) - 389 (389) -
General and
administrative 1,164 (1,164) - 1,184 (1,184) -
-------- ------- -------- -------- ------- --------
Total stock-based
compensation $ 3,632 $(3,632) $ - $ 2,558 $(2,558) $ -
-------- ------- -------- -------- ------- --------
(7) Income tax effects were calculated using an effective GAAP tax rate of
28.9% and 28.5% in the second quarter of 2010 and 2009, respectively,
and an effective non-GAAP tax rate of 33.2% and 28.5% in the second
quarter of 2010 and 2009, respectively. The difference between our GAAP
and non-GAAP tax rates in the second quarter of 2010 was due to the
differences in allowable acquisition-related deductions for income tax
purposes.
Income tax effects were calculated using an effective GAAP tax rate of
16.9% and 29.3% in the first six months of 2010 and 2009, respectively,
and an effective non-GAAP tax rate of 33.6% and 29.3% in the first six
months of 2010 and 2009, respectively. The difference between our GAAP
and non-GAAP tax rates in the first six months of 2010 was due to the
differences in allowable acquisition-related deductions for income tax
purposes.
Pegasystems Inc.
Unaudited Condensed Consolidated Balance Sheets
As of As of
June 30, December 31,
2010 2009
------------ ------------
(in thousands)
Current Assets:
Cash and cash equivalents $ 63,033 $ 63,857
Marketable securities 11,008 138,796
------------ ------------
Total cash, cash equivalents, and
marketable securities 74,041 202,653
Trade accounts receivable, net 65,910 39,396
Short-term license installments 2,638 2,829
Deferred income taxes 4,514 2,523
Income taxes receivable and other current
assets 16,000 8,840
------------ ------------
Total current assets 163,103 256,241
Long-term license installments, net 2,394 2,976
Property and equipment, net 11,265 8,931
Long-term deferred income taxes and other assets 2,129 8,710
Intangible assets, net 88,728 336
Goodwill 50,976 2,391
------------ ------------
Total assets $ 318,595 $ 279,585
============ ============
Current liabilities:
Accounts payable $ 5,483 $ 4,791
Accrued expenses 23,338 6,748
Accrued compensation and related expenses 18,839 23,280
Deferred revenue 53,761 32,870
------------ ------------
Total current liabilities 101,421 67,689
Income taxes payable 6,778 4,828
Other long-term liabilities 7,462 1,849
------------ ------------
Total liabilities 115,661 74,366
Stockholders' equity: 202,934 205,219
------------ ------------
Total liabilities and stockholders'
equity $ 318,595 $ 279,585
============ ============
Pegasystems Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
Six Months Ended
June 30,
2010 2009
----------- -----------
(in thousands)
Operating activities:
Net (loss) income $ (4,337) $ 19,883
Adjustments to reconcile net (loss) income to
cash (used in) provided by operating
activities:
Excess tax benefit from equity awards
and deferred income taxes (5,850) (10,851)
Depreciation, amortization, and other
non-cash items 3,727 1,259
Foreign currency transaction loss 4,011 -
Amortization of investments and realized
gain on sale of investments 666 1,918
Stock-based compensation expense 3,632 2,558
Change in operating assets and
liabilities, and other, net (8,167) 14,665
----------- -----------
Cash (used in) provided by operating
activities (6,318) 29,432
----------- -----------
Cash provided by (used in) investing
activities 14,628 (12,789)
----------- -----------
Cash used in financing activities (3,031) (3,853)
----------- -----------
Effect of exchange rate on cash and cash
equivalents (6,103) 919
----------- -----------
Net (decrease) increase in cash and cash
equivalents (824) 13,709
Cash and cash equivalents, beginning of period 63,857 36,087
----------- -----------
Cash and cash equivalents, end of period $ 63,033 $ 49,796
=========== ===========