Digital River Reports Second Quarter 2012 Financial Results
Digital River, Inc., the revenue growth experts in global cloud commerce, reports its second quarter financial results and announces that its board of directors authorized a new share repurchase program of up to $100 million of its outstanding common shares.
Second Quarter Ended June 30, 2012GAAP ResultsSecond quarter revenue totaled $90.8 million, compared to $92.5 million while the same period in 2011. This result was below management's second quarter revenue guidance of $92 to $94 million.
The completion of the previous program
In light of the completion of the previous program, Digital River's board of directors has authorized a new share repurchase program of up to $100 million of its outstanding common shares. Repurchases in accordance with this program will be made from place to place at the company's discretion, based on ongoing assessments of the capital needs of the business. No time limit was set for completion of the repurchase program.
About Digital River, Inc.Digital River, Inc., the revenue growth experts in global cloud commerce, builds and manages online businesses for software and game publishers, consumer electronics manufacturers, distributors, online retailers and affiliates. Its multi-channel commerce solution, which supports both direct and indirect sales, is designed to help companies of all sizes maximize online earnings as then as reduce the costs and risks of running a global commerce operation. The company's comprehensive platform offers site development and hosting, order management, global payments, cloud-based billing, fraud management, export controls, tax management, physical and digital product fulfillment, multi-lingual customer service, advanced reporting and strategic marketing services.
Non-GAAP Net Income CalculationDigital River's non-GAAP net income is computed by adjusting GAAP pre-tax income as reported on the company's statement of operations by adding back amortization of acquisition-related intangibles, stock-based compensation expense, intangible impairments, unrealized investment gain or loss and restructuring costs, net of a 21 percent tax rate. Non-GAAP diluted revenues per share is calculated using the "if-converted" method with respect to the issuance of the company's 2004 and 2010 convertible notes, which includes shares reserved upon conversion of 199,828 and 7,022,027, respectively. In computing non-GAAP diluted revenues per share, adjust non-GAAP net income to add back debt interest and issuance cost amortization expenses, net of the tax benefit, and at that time divide this amount by fully diluted shares outstanding. This amount, representing the fully diluted revenues computation, is selected to represent non-GAAP diluted earnings per share for each period presented. To provide furthermore clarity, a detailed reconciliation on the comparability of the GAAP and non-GAAP data has been provided in table form following the financial statements accompanying this release.
Forward-Looking StatementsThis press release contains forward-looking statements, including statements regarding the company's anticipated future growth, including future financial performance, as so then as statements containing the words "anticipates," "believes," "plans," "will," "expects," or "guidance" and similar words. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the company, or industry results, to differ materially from those expressed or implied by such forward-looking statements. Such factors include, among others: the company's operating history and variability of operating results; competition in the commerce market; challenges associated with international expansion; the variability of foreign exchange rates; any breach or compromise of the company's security systems; our ability to successfully manage our business during undertaking significant internal investments; our ability to execute upon our payments strategy and expand our business in this sector; our ability to achieve favorable tax rates in our international operations; and other risk factors referenced in the company's public filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended Dec. 31, 2011. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in Digital River's most recent reports on Form 10-K and Form 10-Q, each as it may be amended from time-to-time.
The forward-looking statements for the remainder of fiscal 2012 reflect management's expectations as of July 31, 2012. Results may be materially affected by many factors, just as changes in global conditions in the financial services markets and consumer spending, fluctuations in foreign currency rates, the rate of growth of online commerce and the Internet, progress with key partners and other factors. The guidance assumes, among other things, that there are no changes to stock-based compensation expense and anticipated tax rates. Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management's analysis only as of the date hereof. The company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that may arise afterwards the date hereof.
Digital River, Inc.Investor Relations Contact:Ed MerrittVice President, Investor Relationsinvestorrelations@digitalriver.com952-225-3362orMedia Relations Contact:Gerri DyrekGroup Vice President, Corporate Communicationsgdyrek@digitalriver.com952-225-3719
Digital Rive Second Quarter 2012
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