Medidata Reports Second Quarter 2018 Results
Jul. 24, 2018
NEW YORK--(BUSINESS WIRE)--Jul 24, 2018--Medidata (NASDAQ: MDSO) today announced its financial results for the second quarter of 2018.
“We executed well operationally and delivered strong business results this quarter and in the first half of the year, all while closing our largest acquisition to date,” said Tarek Sherif, chairman and chief executive officer, Medidata. “Providing the life sciences industry a next gen analytics solution for commercialization, and the addition of leading edge, real world evidence capabilities as part of our platform, positions Medidata to be the strategic partner for customers pursuing digital transformation.”
Second Quarter 2018 ResultsTotal revenue was $155.9 million, an increase of $19.9 million, or 15%, compared with $136.0 million in the second quarter of 2017 Subscription revenue was $130.5 million, an increase of $17.6 million, or 16%, compared with the same period last year. Professional services revenue was $25.4 million, an increase of $2.3 million, or 10%, compared with $23.1 million in the second quarter of 2017 GAAP operating income was $12.8 million, up 1%, compared with $12.7 million in the second quarter of 2017. Non-GAAP operating income 1 was $36.6 million, up 18%, compared with $31.0 million a year ago GAAP net income was $16.6 million, or $0.27 per diluted share, up 120%, compared with $7.5 million, or $0.13 per diluted share, in the second quarter of 2017. Non-GAAP net income 1 was $26.4 million, or $0.43 per diluted share, up 46%, compared with $18.1 million, or $0.30 per diluted share, in the second quarter of 2017. See the non-GAAP reconciliation included in this release for full details of the non-GAAP adjustments GAAP net income includes a gain of $7.6 million on the company’s original investment in SHYFT Total cash and marketable securities were $477.4 million at the end of the quarter, compared with $663.3 million on December 31, 2017 Remaining 2018 adjusted subscription backlog 2 as of June 30, 2018 was $263 million, an increase of $40 million, or 18%, compared with a year ago
Additional Highlights:IDC’s report (Worldwide Life Science Software Market Shares, 2017), published this June, names Medidata as the global leader in Life Science Development Software revenue. The report cites that Medidata has extended its leadership position. Novartis partnered with SHYFT to support the commercialization of key therapies in Europe with insights-based analytics Medidata delivered the industry’s largest Synthetic Control Database in Acute Myeloid Leukemia (AML) to a top pharma company. This targeted approach highlights the breadth and value of the company’s clinical data repository. Three top 25 pharma customers added RAVE Imaging to their existing enterprise agreements, indicating how Medidata enables companies to address the increasing use of medical imaging in clinical trials A top 10 pharma customer adopted Edge Site Payments as their global payments platform On average, contracts were renewed at 24% above prior value on a trailing twelve-month basis
"We are on track to achieve our financial targets,” said Rouven Bergmann, chief financial officer, Medidata. “Our competitive position has never been stronger, with the acquisition of SHYFT and continued excellent enterprise renewal performance. On top of this, we increased EBITDAO by over 20% year to date.”
For the full year 2018, the company's guidance provided on June 12, 2018 is unchanged. Please refer to the reconciliation of forward-looking guidance included in this release for full details of the non-GAAP adjustments.
Medidata is leading the digital transformation of life sciences with the world's most-used platform for clinical development, commercial and real-world data. Powered by artificial intelligence and delivered by #1 ranked industry experts, the Intelligent Platform for Life Sciences helps pharmaceutical, biotech, medical device companies and academic researchers accelerate value, minimize risk and optimize outcomes. Medidata serves more than 1,000 customers and partners worldwide and empowers more than 100,000 certified users every day to create hope for millions of patients. Discover the future of life sciences: www.mdsol.com
Certain statements made in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks and uncertainties about Medidata Solutions, Inc. (“Medidata”), including, but not limited to, statements about Medidata’s forecast of financial performance, products and services, business model, strategy and growth opportunities, and competitive position. Such statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in these statements. Among other things, the risks and uncertainties include, those associated with possible fluctuations in our financial and operating results; integration activities, performance and financial impact of acquired companies; our ability to retain and expand our customer base or increase new business from those customers; our ability to continue to release, and gain customer acceptance of, new and improved versions of our products. For additional disclosure regarding these and other risks faced by Medidata, see disclosures contained in Medidata’s public filings with the Securities and Exchange Commission, including the “Risk Factors” section of Medidata’s Annual Report on Form 10-K for the year ended December 31, 2017. You should consider these factors in evaluating the forward-looking statements included in this press release and not place undue reliance on such statements. The forward-looking statements are made as of the date hereof, and Medidata undertakes no obligation to update such statements as a result of new information, new developments or otherwise, except as required by law.
(1) Non-GAAP Financial Information
Medidata provides non-GAAP operating income, net income, and net income per share data as a supplement to its operating results. These measures are not in accordance with, or an alternative to, generally accepted accounting principles (GAAP), and may be different from non-GAAP measures used by other companies. Management uses these non-GAAP measures to evaluate its financial results, develop budgets, manage expenditures, and as an important factor in determining variable compensation. In addition, management believes, based on discussions with investors, that these non-GAAP measures enhance investors’ ability to assess Medidata’s historical and projected future financial performance. While management believes these non-GAAP financial measures provide useful supplemental information to investors, there are inherent limitations associated with the use of non-GAAP financial measures. Investors are encouraged to review the attached reconciliations of these non-GAAP financial measures to the nearest comparable GAAP measures.
(2) Adjusted subscription backlog equals subscription backlog plus outstanding intra-year renewals valued at an amount equal to the contracts to be renewed.
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