MicroStrategy Announces First Quarter 2013 Financial Results

         MicroStrategy Announces First Quarter 2013 Financial Results

PR Newswire

TYSONS CORNER, Va., April 29, 2013

TYSONS CORNER, Va., April 29, 2013 /PRNewswire/ --MicroStrategy® Incorporated
(Nasdaq: MSTR), a leading worldwide provider of business intelligence (BI) and
mobile software, today announced financial results for the three-month period
ended March 31, 2013 (the first quarter of its 2013 fiscal year).

First quarter 2013 revenues were $130.2 million versus $138.3 million for the
first quarter of 2012, a 6% decrease. Product licenses revenues for the first
quarter of 2013 were $28.4 million versus $37.5 million for the first quarter
of 2012, a 24% decrease. Product support and other services revenues for the
first quarter of 2013 were $101.8 million versus $100.9 million for the first
quarter of 2012, a 1% increase.

Operating expenses for the first quarter of 2013 were $102.9 million versus
$101.0 million for the first quarter of 2012, a 2% increase.

The loss from continuing operations for the first quarter of 2013 was $5.2
million, or ($0.46) per share on a diluted basis, compared to income of $1.1
million, or $0.09 per share on a diluted basis, for the first quarter of 2012.

Income from discontinued operations, net of tax, for the first quarter of 2013
was $56.8 million, or $5.03 per share on a diluted basis, compared to a loss
of $0.8 million, or ($0.07) per share on a diluted basis, for the first
quarter of 2012. On March 15, 2013, MicroStrategy completed the sale of its
wholly-owned subsidiary, Angel.com Incorporated, resulting in a gain, net of
tax, of $57.4 million during the first quarter of 2013.

Net income for the first quarter of 2013, including the gain from the
Angel.com sale, was $51.6 million, or $4.57 per share on a diluted basis,
compared to $0.3 million, or $0.02 per share on a diluted basis, for the first
quarter of 2012.

As of March 31, 2013, MicroStrategy had cash and cash equivalents of $330.2
million versus $223.0 million as of December 31, 2012, an increase of $107.2
million. As of March 31, 2013, MicroStrategy had 9,073,350 shares of class A
common stock and 2,227,327 shares of class B common stock outstanding.

MicroStrategy also announced that the term of its 2005 share repurchase
program ("2005 Repurchase Program"), which was scheduled to expire on April
29, 2013, has been extended until April 29, 2018. As of March 31, 2013, the
Company had repurchased an aggregate of 3,826,947 shares of its class A common
stock at an aggregate cost of $345.3 million under the 2005 Repurchase
Program, and $454.7 million of the Company's class A common stock remained
available for repurchase pursuant to such program. The timing and amount of
any shares repurchased will be determined by MicroStrategy's management based
on its evaluation of market conditions and other factors. The 2005 Repurchase
Program may be funded by using the Company's working capital, as well as
proceeds from any credit facilities and other borrowing arrangements which the
Company may enter into in the future.

SMBs to Fortune 100 Companies: Finding Value in MicroStrategy's Cloud-based
Business Intelligence (BI) Platform-as-a-Service (PaaS)

In January 2013, MicroStrategy announced that its customers on the
MicroStrategy Cloud™ platform ran over 2 million reports per week through the
Company's innovative BI-in-the-cloud service during 2012. Offering an
innovative, high-quality managed service to its customers, MicroStrategy has
established itself as a leader in cloud-based business analytics.

Leading companies and organizations, such as Johnson & Johnson, Thomson
Reuters, Four Seasons Hotels and Resorts, Ingram Micro, Tapjoy, Coty US,
DeRoyal Industries, Elan Polo International, ViSalus Sciences, Wintrust
Financial Corporation, and the Texas Department of Transportation, have found
value in MicroStrategy Cloud – deploying high-value analytical and mobile
applications much quicker, at a lower cost, and with lower risk than
traditional on-premise approaches.

MicroStrategy Showcases its Business Analytics, Mobile App Platform, and Cloud
Offerings at MicroStrategy World 2013

MicroStrategy held its 16th annual conference, MicroStrategy World 2013, on
January 28-31, 2013 at the Wynn Las Vegas. The four-day event showcased
MicroStrategy's leading platform for BI, mobile reporting and commerce, and
Big Data analytics delivered either on premises or in the cloud. At the
conference, the Company also highlighted its disruptive new products that
provide real-time insight into consumer preferences, mobile retail commerce,
robust data discovery, and effective identity management and cybersecurity.

Gartner Positions MicroStrategy in the "Leaders" Quadrant in 2013 Magic
Quadrant for Business Intelligence and Analytics Platforms Report

In February 2013, Gartner positioned MicroStrategy in the "Leaders" quadrant
in the 2013 Magic Quadrant for Business Intelligence and Analytics Platforms
report. According to Gartner, the dominant theme of the market in 2012 was
that data discovery became a mainstream BI and analytic architecture.
Increasingly, Gartner sees more organizations building diagnostic analytics
that leverage critical capabilities, such as interactive visualization, to
enable users to drill more easily into the data to discover new insights.
Furthermore, Gartner believes "this emphasis on data discovery from most of
the leaders in the market – which are now promoting tools with
business-user-friendly data integration, coupled with embedded storage and
computing layers (typically in-memory/columnar) and unfettered drilling –
accelerates the trend toward decentralization and user empowerment of BI and
analytics, and greatly enables organizations' ability to perform diagnostic
analytics." A copy of the Gartner report is available, compliments of
MicroStrategy, at http://www.microstrategy.com/gartner.

MicroStrategy Announced Sale of Angel Subsidiary

On March 15, 2013, MicroStrategy announced that it had completed the sale of
its Angel.com Incorporated subsidiary, a leading provider of cloud-based
customer experience management (CEM) solutions for interactive voice response
and contact centers, to Genesys Telecommunications Laboratories, Inc. for an
aggregate purchase price of approximately $111 million in cash, subject to
post-closing adjustments.

MicroStrategy 9.3.1 Delivers Enhanced Visual Data Discovery, New Innovations
in Advanced Big Data Analytics, and Powerful Mobile App Upgrades

In April 2013, MicroStrategy unveiled MicroStrategy 9.3.1™, the latest version
of the Company's core enterprise analytics platform. MicroStrategy 9.3.1
breaks new ground by combining innovative, industry-leading visual data
discovery with enterprise-grade, system-of-record BI. With significant user
interface innovations and major feature enhancements, MicroStrategy 9.3.1
takes agile visual analytics to a new level, delivering:

  oSuperior Productivity for Business Users. A streamlined user experience,
    more powerful data exploration features, and new capabilities to securely
    share visual analytics and insight make MicroStrategy 9.3.1 more
    productive for every business user.
  oBetter Access to Big Data. Optimized data source connections make it
    easier to access and analyze the entire ecosystem of enterprise data,
    including Hadoop-based data.
  oMore Expansive Advanced and Predictive Analytics. MicroStrategy 9.3.1
    enables business users to quickly and easily leverage advanced analytics
    to improve decision-making.
  oInnovative Mobile Applications. MicroStrategy9.3.1 provides customers
    with improved app platform capabilities for code-free development of any
    business app, including native mobile apps for an immersive analytical
    experience.
  oMore Flexible Deployment Options. MicroStrategy 9.3.1 can be installed
    and deployed on premises, and is also available as a subscription-based
    service with MicroStrategy Cloud.

"MicroStrategy 9.3.1 delivers on the promise of agile visual data discovery --
fast, easy-to-use, self-service analytics for business, with all the security,
performance, scale, and reliability of an enterprise-grade BI platform," said
Michael Saylor, Chairman and CEO, MicroStrategy Incorporated.

Examples of Customer Deals from Q1 2013

Banfield Pet Hospital®

Founded in Portland, Oregon, in 1955, Banfield Pet Hospital is the largest
general veterinary practice in the world. In 2007, Banfield joined the Mars,
Inc. family of businesses, and has more than 800 hospitals in neighborhoods
across the United States. Banfield recently chose MicroStrategy to implement a
standardized set of KPIs to their field and medical leaders. With
MicroStrategy, Banfield's leadership teams will have immediate insight into
the veterinary practice's financial performance, associate engagement, and
client success using their mobile devices. MicroStrategy was ultimately
selected for its mobile app development platform, ease-of-use, and superior
visualization capabilities.

Celio

Founded in 1985, Celio is an established international brand of men's
ready-to-wear fashion, and has a global presence with more than 1,000 stores
in 60 countries. Celio, based in France, chose MicroStrategy Cloud to support
its new business intelligence initiatives. Celio will use MicroStrategy Cloud
to monitor sales performance, analyze financial reporting, and improve supply
chain management. Celio selected MicroStrategy for its integrated
architecture platform, ease-of-use, and mobile visualization capabilities, all
available in the cloud.

George Mason University

Located in Northern Virginia near Washington, D.C., George Mason University
(GMU) is an innovative, entrepreneurial institution with global distinction in
a range of academic fields. GMU selected MicroStrategy as its enterprise BI
software solution. By standardizing its reports and dashboards on
MicroStrategy, GMU will give its approximately 700 end users highly
interactive views of university data to track admissions and enrollment
information, as well as financial and HR data. Members of IT, staff,
administrators and faculty will use drop-down and selector capabilities to see
different visualizations of the data, such as monitoring class enrollment to
effectively manage and schedule classes. GMU selected MicroStrategy for its
organically-grown architecture platform, ease-of-use, superior customer
references in the higher education space, as well as its visualization and
reporting capabilities.

Husqvarna Group

Husqvarna Group, based in Sweden, with reported sales in 2012 totaling SEK 31
billion and 15,400 employees in more than 40 countries, is the world's largest
producer of outdoor power products, including robotic lawn mowers, garden
tractors, chainsaws, and trimmers. Husqvarna chose MicroStrategy to build a
mobile solution that will empower its management team to track sales
performance by region for its various product lines, and view trends about the
company's sales, transactions and productivity on mobile devices. Husqvarna
selected MicroStrategy for its ease-of-use, mobile app development platform,
flexible architecture, and scalability to accommodate a growing user
community.

New York & Company, Inc.

New York & Company, Inc. (NYSE: NWY), with 519 retail stores in 43 states, is
a leading specialty retailer of women's fashion apparel and accessories, and
the modern wear-to-work destination for women, providing perfectly fitting
pants and NY Style that is feminine, polished, on-trend, and versatile. A
recent expansion of MicroStrategy licenses will allow New York & Company to
upgrade to 64-bit functionality to improve performance, scalability, and
capacity to support their growing reporting environment. New York & Company
selected MicroStrategy for its ease-of-use, superior visualizations, and
analytical reporting capabilities.

Orbitz Worldwide

Orbitz Worldwide is a leading global online travel company that uses
innovative technology to enable leisure and business travelers to research,
plan, and book a broad range of travel products. The Company said an
expansion of MicroStrategy licenses will allow it to standardize on the
MicroStrategy platform and replace multiple disconnected tools. MicroStrategy
provides the analytical capabilities that Orbitz uses to better understand
what their customers and prospects react to on their site, with resulting
insight that helps Orbitz improve their site in terms of purchase conversion,
revenue per transaction, and customer satisfaction. MicroStrategy was
selected for its integrated architecture platform, ease-of-use, scalability to
support Big Data, and ability to report and analyze data across multiple data
sources, which its previous tools were not able to do.

About MicroStrategy Incorporated

Founded in 1989, MicroStrategy (Nasdaq: MSTR) is a leading worldwide provider
of enterprise software, including the MicroStrategy Business Intelligence (BI)
Platform™, the MicroStrategy Mobile Platform™, and MicroStrategy
Applications™. The Company offers its technologies for deployment in customer
data centers and as proprietary cloud services. The MicroStrategy BI Platform
enables leading organizations to analyze vast amounts of data and distribute
business insight throughout the enterprise. The MicroStrategy Mobile Platform
lets organizations rapidly build enterprise-caliber mobile applications needed
to mobilize business processes and information. MicroStrategy Applications
are a set of application services designed to help enterprises deploy mobile
commerce and loyalty services, build mobile identity and cyber security
services, as well as generate real-time insights into consumer preferences.
MicroStrategy Cloud™ allows enterprises to deploy MicroStrategy BI apps and
mobile apps more quickly and with lower financial risk than with traditional
on-premises solutions. To learn more about MicroStrategy, visit
www.microstrategy.com and follow us on Facebook
(http://www.facebook.com/microstrategy) and Twitter
(http://www.twitter.com/microstrategy).

MicroStrategy, MicroStrategy 9, MicroStrategy Business Intelligence Platform,
MicroStrategy Mobile Platform, MicroStrategy Applications, and MicroStrategy
Cloud are either trademarks or registered trademarks of MicroStrategy
Incorporated in the United States and certain other countries. Other product
and company names mentioned herein may be the trademarks of their respective
owners.

This press release may include statements that may constitute "forward-looking
statements," including estimates of future business prospects or financial
results and statements containing the words "believe," "estimate," "project,"
"expect," or similar expressions. Forward-looking statements inherently
involve risks and uncertainties that could cause actual results of
MicroStrategy Incorporated and its subsidiaries (collectively, the "Company")
to differ materially from the forward-looking statements. Factors that could
contribute to such differences include: the extent and timing of market
acceptance of MicroStrategy's new offerings, including MicroStrategy 9.3.1;
the Company's ability to recognize revenue or deferred revenue through
delivery of products or satisfactory performance of services; continued
acceptance of the Company's other products in the marketplace; the timing of
significant orders; delays in the Company's ability to develop or ship new
products; competitive factors; general economic conditions, including
significant downturns in industries, including the financial services and
retail industries, in which we have a significant number of customers;
currency fluctuations; and other risks detailed in the Company's registration
statements and periodic reports filed with the Securities and Exchange
Commission. By making these forward-looking statements, the Company
undertakes no obligation to update these statements for revisions or changes
after the date of this release.

MSTR-F

Contact:
MicroStrategy Incorporated
Investor Relations
ir@microstrategy.com
(703) 848-8600

MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
                                       Three Months Ended
                                       March 31,
                                       2013                2012
                                       (unaudited)         (unaudited)
Revenues
Product licenses                       $     28,368   $     37,453
Product support and other services     101,815             100,881
 Total revenues                       130,183             138,334
Cost of revenues
Product licenses                       1,593               2,146
Product support and other services     34,308              33,584
 Total cost of revenues               35,901              35,730
Gross profit                           94,282              102,604
Operating expenses
Sales and marketing                    50,714              55,141
Research and development               25,817              22,174
General and administrative             26,412              23,665
 Total operating expenses             102,943             100,980
(Loss) income from continuing
operations before
financing and other income and         (8,661)             1,624
income taxes
Financing and other income
(expense)
Interest income, net                   61                  15
Other income (expense), net            1,708               (124)
 Total financing and other income     1,769               (109)
(expense)
(Loss) income from continuing          (6,892)             1,515
operations before income taxes
 (Benefit) provision for income       (1,701)             454
taxes
(Loss) income from continuing          (5,191)             1,061
operations
Discontinued operations
 Gain from sale of discontinued
operations, net of tax provision       57,377              -
($37,548 and $0, respectively)
 Loss from discontinued
operations, net of tax benefit         (595)               (789)
($391 and $413, respectively)
Discontinued operations, net of tax    56,782              (789)
Net income                             $    51,591     $       272
Basic earnings (loss) per share
(1):
 From continuing operations           $      (0.46)  $       0.10
 From discontinued operations         5.03                (0.07)
 Basic earnings per share           $       4.57  $       0.03
Weighted average shares outstanding
used in computing basic earnings       11,295              10,806
per share
Diluted earnings (loss) per share
(1):
 From continuing operations           $      (0.46)  $       0.09
 From discontinued operations         5.03                (0.07)
 Diluted earnings per share         $       4.57  $       0.02
Weighted average shares outstanding
used in computing diluted earnings     11,295              11,092
per share
(1) Basic and fully diluted earnings (loss) per share for
class A and class B common stock are the same.



MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
                                           March 31,           December 31,
                                           2013                2012*
Assets                                     (unaudited)
Current assets
 Cash and cash equivalents                $     330,195   $    
                                                               223,043
 Restricted cash and short-term           200                 86
investments
 Accounts receivable, net                 69,486              89,038
 Prepaid expenses and other current       12,013              12,689
assets
 Deferred tax assets, net                 19,510              26,616
 Assets held-for-sale                     -                   10,571
Total current assets                       431,404             362,043
Property and equipment, net                96,694              96,751
Capitalized software development costs,    9,007               10,360
net
Deposits and other assets                  4,945               5,120
Deferred tax assets, net                   4,079               3,664
Total Assets                               $    546,129     $    477,938
Liabilities and Stockholders' Equity
Current liabilities
 Accounts payable and accrued expenses    $      45,582  $     
                                                               40,905
 Accrued compensation and employee        51,546              71,789
benefits
 Deferred revenue and advance payments    118,918             101,249
 Deferred tax liabilities                 578                 523
 Liabilities held-for-sale                -                   4,689
Total current liabilities                  216,624             219,155
Deferred revenue and advance payments      9,183               8,823
Other long-term liabilities                41,631              43,418
Deferred tax liabilities                   3,858               6,231
Total Liabilities                          271,296             277,627
Stockholders' Equity
 Preferred stock undesignated, $0.001 par
value; 5,000 shares authorized;
 no shares issued or                  -                   -
outstanding
 Class A common stock, $0.001 par value;
330,000 shares authorized;
 15,478 shares issued and 9,073 shares
outstanding, and 15,462 shares
 issued and 9,057 shares outstanding,  15                  15
respectively
 Class B common stock, $0.001 par value;
165,000 shares authorized;
 2,227 shares issued and outstanding,
and 2,227 shares issued and outstanding,   2                   2
respectively
 Additional paid-in capital               492,005             468,087
 Treasury stock, at cost; 6,405 shares    (475,184)           (475,184)
 Accumulated other comprehensive loss     (2,502)             (1,515)
 Retained earnings                        260,497             208,906
Total Stockholders' Equity                 274,833             200,311
Total Liabilities and Stockholders' Equity $    546,129     $    477,938
*Derived from audited financial
statements.



MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
                                                Three Months Ended
                                                March 31,
                                                2013           2012
                                                (unaudited)    (unaudited)
Operating activities:
  Net income                                    $   51,591  $      272
  Plus: (Income) loss from discontinued        (56,782)       789
  operations, net of tax
             (Loss) income from continuing      (5,191)        1,061
             operations
  Adjustments to reconcile net income to net
  cash (used in) provided by operating
  activities:
       Depreciation and amortization            6,456          5,918
       Bad debt expense                         1,298          977
       Deferred taxes                           (3,962)        (2,367)
       Excess tax benefits from share-based     (23,579)       -
       compensation arrangements
  Changes in operating assets and liabilities:
       Accounts receivable                      16,941         17,411
       Prepaid expenses and other current       419            1,020
       assets
       Deposits and other assets                25             234
       Accounts payable and accrued expenses    (354)          1,558
       Accrued compensation and employee        (19,466)       (17,486)
       benefits
       Deferred revenue and advance payments    19,482         15,849
       Other long-term liabilities              (1,564)        (2,212)
             Net cash (used in) provided by
             operating activities from          (9,495)        21,963
             continuing operations
             Net cash used in operating
             activities from discontinued       (664)          (1,189)
             operations
             Net cash (used in) provided by     (10,159)       20,774
             operating activities
Investing activities:
  Purchases of property and equipment           (5,497)        (12,887)
  Insurance proceeds                            -              1,806
  Increase in restricted cash and investments   (124)          (20)
             Net cash used in investing
             activities from continuing         (5,621)        (11,101)
             operations
             Net cash provided by (used in)
             investing activities from          99,633         (565)
             discontinued operations
             Net cash provided by (used in)     94,012         (11,666)
             investing activities
Financing activities:
  Proceeds from sale of class A common stock    339            980
  under exercise of employee stock options
  Excess tax benefits from share-based          23,579         -
  compensation arrangements
  Payments on capital lease obligations         (143)          -
             Net cash provided by financing
             activities from continuing         23,775         980
             operations
             Net cash provided by financing
             activities from discontinued       -              -
             operations
             Net cash provided by financing     23,775         980
             activities
Effect of foreign exchange rate changes on cash (1,826)        1,410
and cash equivalents
Net increase in cash and cash equivalents       105,802        11,498
Cash and cash equivalents (including
held-for-sale of $1,350 and $5,300,             224,393        199,634
respectively), beginning of period
Cash and cash equivalents (including
held-for-sale of $0 and $3,880, respectively),  $  330,195   $  211,132
end of period

SOURCE MicroStrategy Incorporated

Website: http://www.microstrategy.com
 
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