2U, Inc. Reports Second-Quarter 2016 Financial Results
LANDOVER, Md. , Aug. 4, 2016 /PRNewswire/ -- 2U, Inc. (NASDAQ : TWOU), today reported financial and operating results for the second quarter ended June 30, 2016 .
Second-Quarter 2016 Results
- Revenue was $49.1 million, an increase of 39 percent from $35.2 million in the second quarter of 2015.
- Net loss was $(8.3) million, or $(0.18) per share, compared to $(9.6) million, or $(0.23) per share, in the second quarter of 2015.
- Adjusted net loss was $(4.4) million, or
$(0.09) per share, compared to an adjusted net loss of $(5.8) million , or $(0.14) per share, in the second quarter of 2015.
- Adjusted EBITDA loss was $(2.1) million, compared to an adjusted EBITDA loss of $(4.0) million in the second quarter of 2015.
"2U had another great quarter as we once again exceeded previously stated guidance for all of our financial measures," said Chip Paucek , 2U's CEO and co-founder. "In addition to 39 percent revenue growth, we also saw significant margin improvement in our earnings measures for the quarter. On a year-over-year basis, our net loss margin improved by 10 percentage points and our adjusted EBITDA loss margin improved by seven percentage points."
Financial Outlook
Based on information available as of today, 2U is issuing the following guidance for third quarter and full year of 2016.
(in millions, except per share amounts)
3Q 2016
FY 2016
Revenue
$49.9-$50.4
$201.6-$202.6
Net Loss
$(9.0)-$(8.6)
$(24.6)-$(23.7)
Net Loss per Share
$(0.19)-$(0.18)
$(0.53)-$(0.51)
Adjusted Net Loss
$(4.6)-$(4.2)
$(8.1) -($7.2 )
Adjusted Net Loss per Share
$(0.10)-$(0.09)
$(0.17)-$(0.15)
Weighted-Average Shares of Common Stock
47.0
46.7
Adjusted EBITDA (Loss)
$(2.0)-$(1.6)
$1.7-$2.6
Stock-Based Compensation Expense
$4.3-$4.5
$16.3-$16.7
In giving third-quarter and full-year 2016 guidance, the Company's expectations for the fourth quarter are implied. Note that cost seasonality in the fourth quarter typically improves margins in that quarter; fourth-quarter margins therefore should not be viewed as a run rate for the first quarter of the following year.
Non-GAAP Measures
To supplement the Company's consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles ("GAAP"), we use adjusted EBITDA, adjusted net income (loss) and adjusted net income (loss) per share, which are non-GAAP financial measures.
We define adjusted EBITDA as net income or net loss, as applicable, before net interest income (expense), taxes, depreciation and amortization, and stock-based compensation expense. Some or all of these items may not be applicable in any given reporting period.
We define adjusted net income (loss) as net income or net loss, as applicable, attributable to holders of common stock before stock-based compensation expense. Adjusted net loss per share is calculated as adjusted net loss divided by weighted-average common shares outstanding, basic and diluted. Adjusted net income per share is calculated as adjusted net income divided by weighted-average common shares outstanding, on a diluted basis.
The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by GAAP to be recorded in the company's financial statements. These non-GAAP measures are key metrics company management uses to compare the company's performance to that of prior periods for trend analyses, and for budgeting and planning purposes. These measures also provide useful information to investors and analysts relating to 2U's financial condition and results of operations. These financial measures are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. In addition, these financial measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.
For more information on 2U's non-GAAP financial measures and reconciliations of such measures to the nearest GAAP measures, please see the reconciliation tables on the last page of this press release under the heading "Reconciliation of Non-GAAP Measures." 2U urges investors to review these reconciliations and not to rely on any single financial measure to evaluate the company's business.
Conference Call Information
What:
2U, Inc.'s second-quarter 2016 financial results conference call
When:
Thursday, August 4, 2016
Time:
5 p.m. ET
Live Call:
(877) 359-9508
Webcast:
About 2U, Inc. (NASDAQ : TWOU)
2U partners with leading colleges and universities to deliver the world's best online degree programs so students everywhere can reach their full potential. Our Platform, a fusion of cloud-based software-as-a-service technology and technology-enabled services, provides schools with the comprehensive operating infrastructure they need to attract, enroll, educate, support and graduate students globally. Blending live face-to-face classes, dynamic course content and real-world learning experiences, 2U's No Back Row ® approach ensures that every qualified student can experience the highest quality university education for the most successful outcome.
To learn more, go to 2U.com. Be sure to follow us on LinkedIn (http://www.linkedin.com/company/2u), Twitter (http://twitter.com/2Uinc) and Facebook (http://www.facebook.com/2u).
Cautionary Language Concerning Forward-Looking Statements
This press release contains forward-looking statements regarding our future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release, including statements regarding future results of the operations and financial position of 2U, Inc., including financial targets, business strategy, and plans and objectives for future operations, are forward-looking statements. 2U has based these forward-looking statements largely on its estimates of its financial results and its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, short term and long-term business operations and objectives, and financial needs as of the
date of this press release. We undertake no obligation to update these statements as a result of new information or future events. These forward-looking statements are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from the results predicted, including, our failure to attract new colleges and universities as clients; our failure to acquire qualified students for our clients' programs; failure of clients' students to remain enrolled in their programs; loss, or material underperformance, of any one client; our ability to compete against current and future competitors; disruption to, or failure of, our Platform; and data privacy or security breaches. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed under the heading "Risk Factors" in
our Annual Report on Form 10-K for the year ended December 31, 2015 and other reports filed with the Securities and Exchange Commission. Moreover, 2U operates in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for 2U management to predict all risks, nor can 2U assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements 2U may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this press release may not occur and actual results could differ materially and adversely from those anticipated.
Investor Relations Contact: Ed Goodwin, Sr. Director of Investor Relations, 2U, Inc., egoodwin@2u.com
Media Contact: Shirley Chow, Director of Public Relations, 2U, Inc., schow@2u.com
2U, Inc.
Condensed Consolidated Balance Sheets
(unaudited, in thousands, except share and per share amounts)
June 30 ,
2016
December 31 ,
2015
Assets
Current assets:
Cash and cash equivalents
$
188,251
$
183,729
Accounts receivable, net
5,242
975
Advance to clients
1,125
1,508
Prepaid expenses and other assets
7,163
6,695
Total current assets
201,781
192,907
Property and equipment, net
3,994
3,621
Capitalized technology and content development costs, net
26,820
22,628
Advance to clients, non-current
1,350
1,042
Prepaid expenses, non-current
8,123
7,099
Other non-current assets
3,768
3,744
Total assets
$
245,836
$
231,041
Liabilities and stockholders' equity
Current liabilities:
Accounts payable
$
5,588
$
4,544
Accrued compensation and related benefits
9,987
13,405
Accrued expenses and other liabilities
16,916
12,039
Deferred revenue
17,587
2,609
Total current liabilities
50,078
32,597
Non-current liabilities
2,543
2,655
Total liabilities
52,621
35,252
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized,
0 shares issued and outstanding as of June 30, 2016 and
December 31, 2015
—
—
Common stock, $0.001 par value, 200,000,000 shares
authorized, 46,632,069 shares issued and outstanding as of
June 30, 2016 ; 45,776,455 shares issued and outstanding as of
December 31, 2015
47
46
Additional paid-in capital
360,466
351,324
Accumulated deficit
(167,298)
(155,581)
Total stockholders' equity
193,215
195,789
Total liabilities and stockholders' equity
$
245,836
$
231,041
2U, Inc.
Condensed Consolidated Statements of Operations
(unaudited, in thousands, except share and per share amounts)
Three Months Ended
June 30 ,
Six Months Ended
June 30 ,
2016
2015
2016
2015
Revenue
$
49,110
$
35,238
$
96,554
$
69,850
Costs and expenses:
Servicing and support
10,260
7,903
19,772
15,454
Technology and content development
8,842
6,466
16,117
12,600
Program marketing and sales
27,483
21,526
51,139
41,113
General and administrative
10,944
8,871
21,391
15,582
Total costs and expenses
57,529
44,766
108,419
84,749
Loss from operations
(8,419)
(9,528)
(11,865)
(14,899)
Other income (expense):
Interest expense
(9)
(126)
(35)
(252)
Interest income
91
24
183
53
Total other income (expense)
82
(102)
148
(199)
Loss before income taxes
(8,337)
(9,630)
(11,717)
(15,098)
Income tax expense
—
—
—
—
Net loss
$
(8,337)
$
(9,630)
$
(11,717)
$
(15,098)
Net loss per share, basic and diluted
$
(0.18)
$
(0.23)
$
(0.25)
$
(0.37)
Weighted-average shares of common stock
outstanding, basic and diluted
46,494,464
41,362,476
46,226,117
41,171,669
2U, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited, in thousands)
Six Months Ended
June 30 ,
2016
2015
Cash flows from operating activities
Net loss
$
(11,717)
$
(15,098)
Adjustments to reconcile net loss to net cash provided by operating
activities:
Depreciation and amortization
4,526
3,390
Stock-based compensation expense
7,520
5,915
Changes in operating assets and liabilities:
Increase in accounts receivable, net
(4,267)
(4,043)
Decrease (increase) in advance to clients
75
(875)
Increase in prepaid expenses and other current assets
(645)
(366)
Increase in accounts payable
1,044
784
Decrease in accrued compensation and related benefits
(3,419)
(1,533)
Increase in accrued expenses and other liabilities
4,776
8,108
Increase in deferred revenue
14,978
11,520
Decrease (increase) in payments to clients
1,664
(336)
Increase in other assets and other liabilities, net
(3,028)
(1,424)
Net cash provided by operating activities
11,507
6,042
Cash flows from investing activities
Purchases of property and equipment
(1,029)
(589)
Capitalized technology and content development cost expenditures
(7,437)
(5,949)
Other
(142)
—
Net cash used in investing activities
(8,608)
(6,538)
Cash flows from financing activities
Proceeds from exercise of stock options
2,156
2,227
Other
(533)
(436)
Net cash provided by financing activities
1,623
1,791
Net increase in cash and cash equivalents
4,522
1,295
Cash and cash equivalents, beginning of period
183,729
86,929
Cash and cash equivalents, end of period
$
188,251
$
88,224
Supplemental disclosure of non-cash investing and financing
activities
Accrued capital expenditures
$
904
$
199
2U, Inc.
Reconciliation of Non-GAAP Measures
(unaudited)
The following table presents a reconciliation of net loss to adjusted net loss for each of the periods indicated:
Three Months Ended
June 30 ,
Six Months Ended
June 30 ,
2016
2015
2016
2015
(in thousands)
Net loss
$
(8,337)
$
(9,630)
$
(11,717)
$
(15,098)
Adjustments:
Stock-based compensation
expense
3,976
3,867
7,520
5,915
Total adjustments
3,976
3,867
7,520
5,915
Adjusted net loss
$
(4,361)
$
(5,763)
$
(4,197)
$
(9,183)
The following table presents a reconciliation of net loss to adjusted EBITDA (loss) for each of the periods indicated:
Three Months Ended
June 30 ,
Six Months Ended
June 30 ,
2016
2015
2016
2015
(in thousands)
Net loss
$
(8,337)
$
(9,630)
$
(11,717)
$
(15,098)
Adjustments:
Interest expense
9
126
35
252
Interest income
(91)
(24)
(183)
(53)
Depreciation and amortization
expense
2,377
1,677
4,526
3,390
Stock-based compensation
expense
3,976
3,867
7,520
5,915
Total adjustments
6,271
5,646
11,898
9,504
Adjusted EBITDA (loss)
$
(2,066)
$
(3,984)
$
181
$
(5,594)
The following table presents (i) a reconciliation of net loss guidance to adjusted net loss guidance and adjusted EBITDA (loss) guidance and (ii) a reconciliation of net loss per share guidance to adjusted net loss per share guidance, each at the midpoint of the ranges provided by the company, for each of the periods indicated:
Three Months Ended
September 30, 2016
Year Ended
December 31, 2016
$
$/Share
$
$/Share
(in thousands, except per share amounts)
Net loss
$
(8,800)
$
(0.18)
$
(24,150)
$
(0.51)
Stock-based compensation expense
4,400
0.09
16,500
0.35
Adjusted net loss
(4,400)
(0.09)
(7,650)
(0.16)
Net interest income (expense)
-
*
-
*
Depreciation and amortization expense
2,600
*
9,800
*
Adjusted EBITDA (loss)
$
(1,800)
$
*
$
2,150
$
*
Projected weighted-average shares of
common stock outstanding,
basic and diluted
47,000
46,700
* Not provided.
Key Financial Performance Metrics
(unaudited)
Platform Revenue Retention Rate
The following table sets forth our platform revenue retention rate for the periods presented, as well as the number of programs included in the platform revenue retention rate calculation.
Three Months Ended
June 30 ,
Six Months Ended
June 30 ,
2016
2015
2016
2015
Platform revenue retention rate
134.2%
130.5%
123.7%
124.8%
Number of programs included in
comparison (1)
15
10
12
9
(1) Reflects the number of programs operating both in the reported period and in the prior year comparative period.
Full Course Equivalent Enrollments
The following table sets forth the full course equivalent enrollments and average revenue per full course equivalent enrollment in our clients' programs for the last eight quarters.
Q3 '14
Q4 '14
Q1 '15
Q2 '15
Q3 '15
Q4 '15
Q1 '16
Q2 '16
Full course equivalent enrollments in
our clients' programs
10,389
11,505
13,093
13,557
13,840
16,530
17,709
18,823
Average revenue per full course
equivalent enrollment in our clients'
programs
$ 2,734
$ 2,673
$ 2,644
$ 2,599
$ 2,680
$ 2,617
$ 2,679
$ 2,609
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/2u-inc-reports-second-quarter-2016-financial-results-300309490.html
SOURCE 2U
News Provided by Acquire Media
Second-Quarter 2016 Results
- Revenue was $49.1 million, an increase of 39 percent from $35.2 million in the second quarter of 2015.
- Net loss was $(8.3) million, or $(0.18) per share, compared to $(9.6) million, or $(0.23) per share, in the second quarter of 2015.
- Adjusted net loss was $(4.4) million, or
$(0.09) per share, compared to an adjusted net loss of$(5.8) million , or$(0.14) per share, in the second quarter of 2015. - Adjusted EBITDA loss was $(2.1) million, compared to an adjusted EBITDA loss of $(4.0) million in the second quarter of 2015.
"2U had another great quarter as we once again exceeded previously stated guidance for all of our financial measures," said
Financial Outlook
Based on information available as of today, 2U is issuing the following guidance for third quarter and full year of 2016.
|
(in millions, except per share amounts) |
3Q 2016 |
FY 2016 |
|
Revenue |
|
|
|
Net Loss |
|
|
|
Net Loss per Share |
|
|
|
Adjusted Net Loss |
|
|
|
Adjusted Net Loss per Share |
|
|
|
Weighted-Average Shares of Common Stock |
47.0 |
46.7 |
|
Adjusted EBITDA (Loss) |
|
|
|
Stock-Based Compensation Expense |
|
|
In giving third-quarter and full-year 2016 guidance, the Company's expectations for the fourth quarter are implied. Note that cost seasonality in the fourth quarter typically improves margins in that quarter; fourth-quarter margins therefore should not be viewed as a run rate for the first quarter of the following year.
Non-GAAP Measures
To supplement the Company's consolidated financial statements, which are prepared and presented in accordance with
We define adjusted EBITDA as net income or net loss, as applicable, before net interest income (expense), taxes, depreciation and amortization, and stock-based compensation expense. Some or all of these items may not be applicable in any given reporting period.
We define adjusted net income (loss) as net income or net loss, as applicable, attributable to holders of common stock before stock-based compensation expense. Adjusted net loss per share is calculated as adjusted net loss divided by weighted-average common shares outstanding, basic and diluted. Adjusted net income per share is calculated as adjusted net income divided by weighted-average common shares outstanding, on a diluted basis.
The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by GAAP to be recorded in the company's financial statements. These non-GAAP measures are key metrics company management uses to compare the company's performance to that of prior periods for trend analyses, and for budgeting and planning purposes. These measures also provide useful information to investors and analysts relating to 2U's financial condition and results of operations. These financial measures are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. In addition, these financial measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.
For more information on 2U's non-GAAP financial measures and reconciliations of such measures to the nearest GAAP measures, please see the reconciliation tables on the last page of this press release under the heading "Reconciliation of Non-GAAP Measures." 2U urges investors to review these reconciliations and not to rely on any single financial measure to evaluate the company's business.
Conference Call Information
|
What: |
|
|
When: |
|
|
Time: |
|
|
Live Call: |
(877) 359-9508 |
|
Webcast: |
About
2U partners with leading colleges and universities to deliver the world's best online degree programs so students everywhere can reach their full potential. Our Platform, a fusion of cloud-based software-as-a-service technology and technology-enabled services, provides schools with the comprehensive operating infrastructure they need to attract, enroll, educate, support and graduate students globally. Blending live face-to-face classes, dynamic course content and real-world learning
To learn more, go to 2U.com. Be sure to follow us on LinkedIn (http://www.linkedin.com/company/2u), Twitter (http://twitter.com/2Uinc) and Facebook (http://www.facebook.com/2u).
Cautionary Language Concerning Forward-Looking Statements
This press release contains forward-looking statements regarding our future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release, including statements regarding future results of the operations and financial position of 2U, Inc., including financial targets, business strategy, and plans and objectives for future operations, are forward-looking statements. 2U has based these forward-looking statements largely on its estimates of its financial results and its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, short term and long-term business operations and objectives, and financial needs as of the date of this press release. We undertake no obligation to update these statements as a result of new information or future events. These forward-looking statements are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from the results predicted, including, our failure to attract new colleges and universities as clients; our failure to acquire qualified students for our clients' programs; failure of clients' students to remain enrolled in their programs; loss, or material underperformance, of any one client; our ability to compete against current and future competitors; disruption to, or failure of, our Platform; and data privacy or security breaches. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed under the heading "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2015 and other reports filed with the Securities and Exchange Commission. Moreover, 2U operates in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for 2U management to predict all risks, nor can 2U assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements 2U may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this press release may not occur and actual results could differ materially and adversely from those anticipated.
Investor Relations Contact: Ed Goodwin, Sr. Director of Investor Relations, 2U, Inc., egoodwin@2u.com
Media Contact: Shirley Chow, Director of Public Relations, 2U, Inc., schow@2u.com
|
2U, Inc. | |||||||
|
Condensed Consolidated Balance Sheets | |||||||
|
(unaudited, in thousands, except share and per share amounts) | |||||||
|
|
|
||||||
|
Assets |
|||||||
|
Current assets: |
|||||||
|
Cash and cash equivalents |
$ |
188,251 |
$ |
183,729 |
|||
|
Accounts receivable, net |
5,242 |
975 |
|||||
|
Advance to clients |
1,125 |
1,508 |
|||||
|
Prepaid expenses and other assets |
7,163 |
6,695 |
|||||
|
Total current assets |
201,781 |
192,907 |
|||||
|
Property and equipment, net |
3,994 |
3,621 |
|||||
|
Capitalized technology and content development costs, net |
26,820 |
22,628 |
|||||
|
Advance to clients, non-current |
1,350 |
1,042 |
|||||
|
Prepaid expenses, non-current |
8,123 |
7,099 |
|||||
|
Other non-current assets |
3,768 |
3,744 |
|||||
|
Total assets |
$ |
245,836 |
$ |
231,041 |
|||
|
Liabilities and stockholders' equity |
|||||||
|
Current liabilities: |
|||||||
|
Accounts payable |
$ |
5,588 |
$ |
4,544 |
|||
|
Accrued compensation and related benefits |
9,987 |
13,405 |
|||||
|
Accrued expenses and other liabilities |
16,916 |
12,039 |
|||||
|
Deferred revenue |
17,587 |
2,609 |
|||||
|
Total current liabilities |
50,078 |
32,597 |
|||||
|
Non-current liabilities |
2,543 |
2,655 |
|||||
|
Total liabilities |
52,621 |
35,252 |
|||||
|
Stockholders' equity: |
|||||||
|
Preferred stock, |
— |
— |
|||||
|
Common stock, |
47 |
46 |
|||||
|
Additional paid-in capital |
360,466 |
351,324 |
|||||
|
Accumulated deficit |
(167,298) |
(155,581) |
|||||
|
Total stockholders' equity |
193,215 |
195,789 |
|||||
|
Total liabilities and stockholders' equity |
$ |
245,836 |
$ |
231,041 |
|||
|
2U, Inc. | |||||||||||||
|
Condensed Consolidated Statements of Operations | |||||||||||||
|
(unaudited, in thousands, except share and per share amounts) | |||||||||||||
|
Three Months Ended |
Six Months Ended |
||||||||||||
|
2016 |
2015 |
2016 |
2015 |
||||||||||
|
Revenue |
$ |
49,110 |
$ |
35,238 |
$ |
96,554 |
$ |
69,850 |
|||||
|
Costs and expenses: |
|||||||||||||
|
Servicing and support |
10,260 |
7,903 |
19,772 |
15,454 |
|||||||||
|
Technology and content development |
8,842 |
6,466 |
16,117 |
12,600 |
|||||||||
|
Program marketing and sales |
27,483 |
21,526 |
51,139 |
41,113 |
|||||||||
|
General and administrative |
10,944 |
8,871 |
21,391 |
15,582 |
|||||||||
|
Total costs and expenses |
57,529 |
44,766 |
108,419 |
84,749 |
|||||||||
|
Loss from operations |
(8,419) |
(9,528) |
(11,865) |
(14,899) |
|||||||||
|
Other income (expense): |
|||||||||||||
|
Interest expense |
(9) |
(126) |
(35) |
(252) |
|||||||||
|
Interest income |
91 |
24 |
183 |
53 |
|||||||||
|
Total other income (expense) |
82 |
(102) |
148 |
(199) |
|||||||||
|
Loss before income taxes |
(8,337) |
(9,630) |
(11,717) |
(15,098) |
|||||||||
|
Income tax expense |
— |
— |
— |
— |
|||||||||
|
Net loss |
$ |
(8,337) |
$ |
(9,630) |
$ |
(11,717) |
$ |
(15,098) |
|||||
|
Net loss per share, basic and diluted |
$ |
(0.18) |
$ |
(0.23) |
$ |
(0.25) |
$ |
(0.37) |
|||||
|
Weighted-average shares of common stock |
46,494,464 |
41,362,476 |
46,226,117 |
41,171,669 |
|||||||||
|
2U, Inc. | |||||||
|
Condensed Consolidated Statements of Cash Flows | |||||||
|
(unaudited, in thousands) | |||||||
|
Six Months Ended |
|||||||
|
2016 |
2015 |
||||||
|
Cash flows from operating activities |
|||||||
|
Net loss |
$ |
(11,717) |
$ |
(15,098) |
|||
|
Adjustments to reconcile net loss to net cash provided by operating |
|||||||
|
Depreciation and amortization |
4,526 |
3,390 |
|||||
|
Stock-based compensation expense |
7,520 |
5,915 |
|||||
|
Changes in operating assets and liabilities: |
|||||||
|
Increase in accounts receivable, net |
(4,267) |
(4,043) |
|||||
|
Decrease (increase) in advance to clients |
75 |
(875) |
|||||
|
Increase in prepaid expenses and other current assets |
(645) |
(366) |
|||||
|
Increase in accounts payable |
1,044 |
784 |
|||||
|
Decrease in accrued compensation and related benefits |
(3,419) |
(1,533) |
|||||
|
Increase in accrued expenses and other liabilities |
4,776 |
8,108 |
|||||
|
Increase in deferred revenue |
14,978 |
11,520 |
|||||
|
Decrease (increase) in payments to clients |
1,664 |
(336) |
|||||
|
Increase in other assets and other liabilities, net |
(3,028) |
(1,424) |
|||||
|
Net cash provided by operating activities |
11,507 |
6,042 |
|||||
|
Cash flows from investing activities |
|||||||
|
Purchases of property and equipment |
(1,029) |
(589) |
|||||
|
Capitalized technology and content development cost expenditures |
(7,437) |
(5,949) |
|||||
|
Other |
(142) |
— |
|||||
|
Net cash used in investing activities |
(8,608) |
(6,538) |
|||||
|
Cash flows from financing activities |
|||||||
|
Proceeds from exercise of stock options |
2,156 |
2,227 |
|||||
|
Other |
(533) |
(436) |
|||||
|
Net cash provided by financing activities |
1,623 |
1,791 |
|||||
|
Net increase in cash and cash equivalents |
4,522 |
1,295 |
|||||
|
Cash and cash equivalents, beginning of period |
183,729 |
86,929 |
|||||
|
Cash and cash equivalents, end of period |
$ |
188,251 |
$ |
88,224 |
|||
|
Supplemental disclosure of non-cash investing and financing |
|||||||
|
Accrued capital expenditures |
$ |
904 |
$ |
199 |
|||
|
| |||||||||||||
|
Reconciliation of Non-GAAP Measures | |||||||||||||
|
(unaudited) | |||||||||||||
|
The following table presents a reconciliation of net loss to adjusted net loss for each of the periods indicated: | |||||||||||||
|
Three Months Ended |
Six Months Ended |
||||||||||||
|
2016 |
2015 |
2016 |
2015 |
||||||||||
|
(in thousands) |
|||||||||||||
|
Net loss |
$ |
(8,337) |
$ |
(9,630) |
$ |
(11,717) |
$ |
(15,098) |
|||||
|
Adjustments: |
|||||||||||||
|
Stock-based compensation |
3,976 |
3,867 |
7,520 |
5,915 |
|||||||||
|
Total adjustments |
3,976 |
3,867 |
7,520 |
5,915 |
|||||||||
|
Adjusted net loss |
$ |
(4,361) |
$ |
(5,763) |
$ |
(4,197) |
$ |
(9,183) |
|||||
|
The following table presents a reconciliation of net loss to adjusted EBITDA (loss) for each of the periods indicated: | |||||||||||||
|
Three Months Ended |
Six Months Ended |
||||||||||||
|
2016 |
2015 |
2016 |
2015 |
||||||||||
|
(in thousands) |
|||||||||||||
|
Net loss |
$ |
(8,337) |
$ |
(9,630) |
$ |
(11,717) |
$ |
(15,098) |
|||||
|
Adjustments: |
|||||||||||||
|
Interest expense |
9 |
126 |
35 |
252 |
|||||||||
|
Interest income |
(91) |
(24) |
(183) |
(53) |
|||||||||
|
Depreciation and amortization |
2,377 |
1,677 |
4,526 |
3,390 |
|||||||||
|
Stock-based compensation |
3,976 |
3,867 |
7,520 |
5,915 |
|||||||||
|
Total adjustments |
6,271 |
5,646 |
11,898 |
9,504 |
|||||||||
|
Adjusted EBITDA (loss) |
$ |
(2,066) |
$ |
(3,984) |
$ |
181 |
$ |
(5,594) |
|||||
|
The following table presents (i) a reconciliation of net loss guidance to adjusted net loss guidance and adjusted EBITDA (loss) guidance and (ii) a reconciliation of net loss per share guidance to adjusted net loss per share guidance, each at the midpoint of the ranges provided by the company, for each of the periods indicated: | |||||||||||||
|
Three Months Ended |
Year Ended |
||||||||||||
|
$ |
$/Share |
$ |
$/Share |
||||||||||
|
(in thousands, except per share amounts) |
|||||||||||||
|
Net loss |
$ |
(8,800) |
$ |
(0.18) |
$ |
(24,150) |
$ |
(0.51) |
|||||
|
Stock-based compensation expense |
4,400 |
0.09 |
16,500 |
0.35 |
|||||||||
|
Adjusted net loss |
(4,400) |
(0.09) |
(7,650) |
(0.16) |
|||||||||
|
Net interest income (expense) |
- |
* |
- |
* |
|||||||||
|
Depreciation and amortization expense |
2,600 |
* |
9,800 |
* |
|||||||||
|
Adjusted EBITDA (loss) |
$ |
(1,800) |
$ |
* |
$ |
2,150 |
$ |
* |
|||||
|
Projected weighted-average shares of |
47,000 |
46,700 |
|||||||||||
|
* Not provided. | |||||||||||||
|
Key Financial Performance Metrics | |||||||||
|
(unaudited) | |||||||||
|
Platform Revenue Retention Rate | |||||||||
|
The following table sets forth our platform revenue retention rate for the periods presented, as well as the number of programs included in the platform revenue retention rate calculation. | |||||||||
|
Three Months Ended |
Six Months Ended |
||||||||
|
2016 |
2015 |
2016 |
2015 |
||||||
|
Platform revenue retention rate |
134.2% |
130.5% |
123.7% |
124.8% |
|||||
|
Number of programs included in |
15 |
10 |
12 |
9 |
|||||
|
(1) Reflects the number of programs operating both in the reported period and in the prior year comparative period. | |||||||||
|
Full Course Equivalent Enrollments | ||||||||
|
The following table sets forth the full course equivalent enrollments and average revenue per full course equivalent enrollment in our clients' programs for the last eight quarters. | ||||||||
|
Q3 '14 |
Q4 '14 |
Q1 '15 |
Q2 '15 |
Q3 '15 |
Q4 '15 |
Q1 '16 |
Q2 '16 | |
|
Full course equivalent enrollments in |
10,389 |
11,505 |
13,093 |
13,557 |
13,840 |
16,530 |
17,709 |
18,823 |
|
Average revenue per full course |
$ 2,734 |
$ 2,673 |
$ 2,644 |
$ 2,599 |
$ 2,680 |
$ 2,617 |
$ 2,679 |
$ 2,609 |
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/2u-inc-reports-second-quarter-2016-financial-results-300309490.html
SOURCE 2U
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