Jive Software Announces Third Quarter 2013 Financial Results

Jive Software Announces Third Quarter 2013 Financial Results

3Q Total Revenue of $37.4 Million, Up 29% Year-Over-Year

PALO ALTO, Calif., Oct. 30, 2013 (GLOBE NEWSWIRE) -- Jive Software, Inc.
(Nasdaq:JIVE), a leader in social business, today announced financial results
for its third quarter ended September 30, 2013.

"Jive reported solid third quarter financial results, which exceeded our
guidance from both a revenue and profitability perspective. The progress we
made was a result of more focused go-to-market execution and more effective
messaging to both business leaders as well as key influencers in the
enterprise's IT organizations," stated Tony Zingale, Chairman and CEO of
Jive."We believe that Jive's new Fall Cloud release, introduced last week at
JiveWorld13, further reinforces our multi-year technology lead, and combined
with our demonstrated customer success, positions Jive well as the industry
continues to move to the mainstream."

Third Quarter 2013 Financial Highlights

  *Revenue: Total revenue for the third quarter was $37.4 million, an
    increase of 29% on a year-over-year basis. Within total revenue, product
    revenue was $33.5 million for the third quarter, an increase of 29% on a
    year-over-year basis. Professional Services revenue for the third quarter
    was $3.9 million, an increase of 30% on a year-over-year basis.
    
  *Non-GAAP Billings: Total billings, which Jive defines as revenue plus the
    change in total deferred revenue, were $37.0 million for the third
    quarter, compared to $38.9 million in the third quarter of 2012.
    Short-term billings, which Jive defines as revenue plus the change in
    short-term deferred, were $39.2 million for the third quarter, compared to
    $31.8 million in the third quarter of 2012.
    
  *Gross Profit: GAAP gross profit for the third quarter was $23.5 million,
    compared to $17.6 million for the third quarter of 2012.Non-GAAP gross
    profit was $25.4 million for the third quarter, representing a
    year-over-year increase of 35%.Non-GAAP gross margin was 68%,
    representing a 300 basis point expansion compared to the non-GAAP gross
    margin in the third quarter of 2012.
    
  *Loss from Operations: GAAP loss from operations for the third quarter was
    $18.5 million,compared to a loss from operations of $11.2 million for the
    third quarter of 2012.Non-GAAP loss from operations was $7.1
    million,compared to a non-GAAP loss from operations of $5.5 million for
    the third quarter of 2012.
    
  *Net Loss: GAAP net loss for the third quarter was $18.7 million, compared
    to a net loss of $11.3 million for the third quarter of 2012. GAAP net
    loss per share for the third quarter was $0.27 based on 68.2 million
    weighted-average shares outstanding, compared to a loss per share of $0.18
    based on 62.9 million weighted-average shares outstanding for the third
    quarter of 2012.
    
    Non-GAAP net loss for the third quarter was $7.3 million, compared to a
    non-GAAP net loss of $5.6 million for the third quarter of 2012. Non-GAAP
    net loss per share for the third quarter was $0.11 based on 68.2 million
    weighted-average shares outstanding, compared to a non-GAAP net loss per
    share of $0.09 based on 62.9 million weighted-average shares outstanding
    for the third quarter of 2012.
    
  *Balance Sheet and Cash Flow: As of September 30, 2013, Jive had cash and
    cash equivalents and marketable securities of $152.0 million, compared to
    $160.9 million as of June 30, 2013.
    
    Jive used $4.8 million in cash from operations and invested $4.0 million
    in capital expenditures, leading to free cash flow of ($8.8) million for
    the third quarter of 2013.Free cash flow was ($1.9) million for the third
    quarter of 2012.Free cash flow is defined as cash flows provided by
    operating activities minus cash flows used to purchase capital
    expenditures.

A reconciliation of GAAP to non-GAAP financial measures has been provided in
the financial statement tables included in this press release. An explanation
of these measures is also included below under the heading "Non-GAAP Financial
Measures."

Third Quarter and Recent Business Highlights

  *Signed new and expanded customer relationships including Cameron
    International, FICO, FireEye, Gasco, Goldman Sachs, Huntsman, Lahey
    Health, Okta, RadioShack, SAIC, ServiceNow and a large German automobile
    manufacturer, among others.
  *Recognized by Gartner, a leading analyst firm, as a leader in its "Social
    Software in the Workplace" Magic Quadrant report.This is the fifth
    consecutive year Jive has been a leader in this Magic Quadrant report.
  *Announced the Jive Fall Cloud release, which includes a revamped social
    directory that helps people find and share expertise, a new social task
    system, new real-time communications options, and seamless integration
    with Google Drive and Gmail, among others business applications.
    Additionally, Jive introduced Jive^x, a new cloud version of its
    industry-leading external community platform with a mix of popular
    features such as advanced gamification and deep integration with Facebook
    and Twitter, which brings social conversations into a central connected
    hub.
  *Expanded our global presence in the third quarter, opening offices in
    Sweden, The Netherlands and Paris and hiring dedicated sales and sales
    engineering teams at each location. Jive also entered the Japanese market
    during the third quarter with a customized, local version of the Jive
    platform and a dedicated sales team in Tokyo.
  *Recently hosted our 5^th annual JiveWorld customer conference in Las
    Vegas, the industry's largest event purely focused on social business.In
    attendance were more than 1,600 customers and partners, with industry
    leaders such as Eloqua (Oracle), Fidelity, Hitachi Data Systems, Mylan,
    Steelcase, Thomson Reuters, T-Mobile, and Northwestern University among
    others, spoke about the proven business value companies can realize when
    deploying enterprise social networks and customer communities.
  *Announced Okta Cloud Connect for Jive, which is part of a new partnership
    between Jive and Okta, a leading cloud-based provider of enterprise-grade
    identity management services.Okta Cloud Connect for Jive gives people
    seamless and secure identity management and single sign-on access to any
    number of business apps in the Jive platform.This is offered at no
    additional cost to the consumer.

Financial Outlook

As of October 30, 2013, Jive is initiating guidance for its fourth quarter
2013 and updating its guidance for the full year 2013, as follows:

  *Fourth Quarter 2013 Guidance: Total revenue is expected to be in the range
    of $38.5 million to $39.5 million. Non-GAAP loss from operations is
    expected to be in the range of $10.5 million to $11.5 million. Non-GAAP
    loss per share is expected to be in the range of $0.15 to $0.17 based on
    approximately 69.1 million weighted-average diluted shares outstanding in
    the fourth quarter of 2013.
  *Full Year 2013 Guidance: Total revenue is expected to be in the range of
    $145.0 million to $146.0 million. Non-GAAP loss from operations is
    expected to be in the range of $36.4 million to $37.4 million. Non-GAAP
    loss per share is expected to be in the range of $0.55 to $0.57 based on
    approximately 67.6 million weighted-average diluted shares
    outstanding.Free cash flow is expected to be in the range of negative
    $17.0 to $19.0 million.

With respect to the Company's expectations under "Financial Outlook" above,
the Company has not reconciled non-GAAP loss from operations or non-GAAP loss
per share to GAAP loss from operations and GAAP loss per share because the
Company does not provide guidance for stock-based compensation, income taxes
or amortization of intangible assets, which are reconciling items between
those Non-GAAP and GAAP measures.As certain items that impact loss from
operations and loss per share are out of the Company's control and/or cannot
be reasonably predicted, the Company is unable to provide such guidance.
Accordingly, a reconciliation to loss from operations and loss per share is
not available without unreasonable effort.

Quarterly Conference Call

Jive will host a conference call today at 2:00 p.m. PT (5:00 p.m. ET) to
review the Company's financial results for the third quarter 2013, in addition
to discussing the Company's outlook for the fourth quarter and full year 2013.
To access this call, dial (888) 670-2256 (domestic) or (913) 312-0728
(international) with conference ID 6675278.A live webcast of the conference
call will be accessible from the investor relations section of Jive's website
at http://investors.jivesoftware.com/ and a replay will be archived and
accessible at: http://investors.jivesoftware.com/events.cfm. A replay of this
conference call can also be accessed through November 6, 2013, by dialing
(877) 870-5176 (domestic) or (858) 384-5517 (international). The replay pass
code is 6675278.

About Jive Software

Jive Software (Nasdaq:JIVE) is a leader in social business. Our cloud-based
collaboration platform connects employees, customers and partners together –
helping a companyincrease productivity by as much as 15%*according to
research performed by a top three global business consultancy firm. By
combining the power of cloud, mobile, big data and proprietary collaboration
technologies, Jive is transforming the way work gets done and unleashing
productivity, creativity and innovation for millions of people in many of the
world's largest companies. For a free trial of Jive's next generation social
business platform, please visit Try Jive.

For more information, please visit www.jivesoftware.com or the Jive News Blog
here.

* Source: Top three global business consultancy research; November 2012

Non-GAAP Financial Measures

The Company uses certain non-GAAP financial measures in this
release.Generally, a non-GAAP financial measure is a numerical measure of a
company's performance, financial position or cash flows that either excludes
or includes amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance with
generally accepted accounting principles.

Non-GAAP gross profit, loss from operations, net loss and net loss per share
exclude stock-based compensation expenses, non-recurring expenses related to
acquisitions, tax benefits derived from acquisitions, and amortization of
acquisition related intangible assets.Total billings are defined by the
Company as revenue plus the change in total deferred revenue.Management
presents these non-GAAP financial measures because it considers them to be
important supplemental measures of performance. Management uses the non-GAAP
financial measures for planning purposes, including analysis of the Company's
performance against prior periods, the preparation of operating budgets and to
determine appropriate levels of operating and capital investments. Management
also believes that the non-GAAP financial measures provide additional insight
for analysts and investors in evaluating the Company's financial and
operational performance. However, these non-GAAP financial measures have
limitations as an analytical tool and are not intended to be an alternative to
financial measures prepared in accordance with GAAP. We intend to provide
these non-GAAP financial measures as part of our future earnings discussions
and, therefore, the inclusion of these non-GAAP financial measures will
provide consistency in our financial reporting. A reconciliation of these
non-GAAP measures to GAAP is provided in the accompanying tables.

Safe Harbor Statement

"Safe Harbor" statement under Private Securities Litigation Reform Act of
1995:This press release contains forward-looking statements, including
statements concerning our financial guidance for the fourth fiscal quarter of
2013 and the full year of 2013, the future growth of the social business
market, the shift in customer focus, our ability to achieve our guidance,
growth in our sales pipeline, the performance and integration of new product
releases, and our ability to capitalize on our leadership position in the
social business market.The achievement of success in the matters covered by
such forward-looking statements involves substantial risks, uncertainties and
assumptions. If any such risks or uncertainties materialize or if any of the
assumptions prove incorrect, our results or events could differ materially
from the results expressed or implied by the forward-looking statements we
make.

The risk and uncertainties referred to above include, but are not limited to,
risks associated with our limited operating history; expectations regarding
the widespread adoption of social business platforms by enterprises;
uncertainty regarding the market for social business platforms; changes in the
competitive dynamics of our market; our ability to increase and predict new
subscriptions; subscription renewal or upsell rates and the impact these rates
may have on our future revenues; our reliance on our own controls and
third-party service providers to host some of our products; the risk that our
security measures could be breached and unauthorized access to customer data
could be obtained; potential third party intellectual property infringement
claims; and the price volatility of our common stock.

The forward-looking statements contained in this press release are also
subject to other risks and uncertainties, including those more fully described
in our filings with the Securities and Exchange Commission, including our
Quarterly Report on Form 10-Q for the three months ended June 30, 2013, filed
with the Securities and Exchange Commission on July 31, 2013.We do not intend
and undertake no duty to publicly release any updates or revisions to any
forward-looking statements contained herein.

                                                              
                                                              
JIVE SOFTWARE, INC.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
                                                              
                       For the Three Months Ended For the Nine Months Ended
                        September 30,              September 30,
                       2013          2012          2013          2012
                                                              
Revenues:                                                      
Product                $33,456     $25,861     $95,678     $71,436
Professional services  3,903        3,012        10,775       9,705
Total revenues         37,359       28,873       106,453      81,141
                                                              
Cost of revenues:                                              
Product                9,034        7,788        27,786       21,745
Professional services  4,851        3,474        12,914       11,055
Total cost of revenues 13,885       11,262       40,700       32,800
Gross profit            23,474       17,611       65,753       48,341
                                                              
Operating expenses:                                            
Research and           14,957       9,845        41,383       27,327
development
Sales and marketing   20,804       14,800       60,148       40,737
General and            6,202        4,127        18,149       11,680
administrative
Total operating        41,963       28,772       119,680      79,744
expenses
                                                              
Loss from operations    (18,489)     (11,161)     (53,927)     (31,403)
                                                              
Other income (expense),                                        
net:
Interest income        53           56           184          116
Interest expense       (54)         (93)         (234)        (325)
Other, net             (186)        42           (295)        (4)
Total other income     (187)        5            (345)        (213)
(expense), net
                                                              
Loss before provision
for (benefit from) from (18,676)     (11,156)     (54,272)     (31,616)
income taxes
Provision for (benefit  29           132          (1,186)      246
from) for income taxes
Net loss                $(18,705)   $(11,288)   $(53,086)   $(31,862)
                                                              
Basic and diluted net   $(0.27)     $(0.18)     $(0.79)     $(0.51)
loss per share
                                                              
Shares used in basic
and diluted per share   68,167       62,921       66,913       62,100
calculations

                                                                
                                                                
JIVE SOFTWARE, INC.
Consolidated Balance Sheets
(In thousands, except share and per share data)
(Unaudited)
                                                                
                                                   September 30, December 31,
                                                    2013          2012
                                                                
Assets                                                           
Current Assets:                                                  
Cash and cash equivalents                          $42,606     $48,955
Short-term marketable securities                   73,444       96,492
Accounts receivable, net of allowances             40,037       54,200
Prepaid expenses and other current assets          10,670       7,864
Total current assets                               166,757      207,511
                                                                
Marketable securities, noncurrent                   35,990       22,607
Property and equipment, net of accumulated          19,978       16,803
depreciation
Goodwill                                            29,753       23,435
Intangible assets, net of accumulated amortization  15,536       11,710
Other assets                                       589          214
Total assets                                       $268,603    $282,280
                                                                
Liabilities and Stockholders' Equity                             
Current Liabilities:                                             
Accounts payable                                   $10,438     $9,557
Accrued payroll and related liabilities            5,271        7,357
Other accrued liabilities                          6,635        7,123
Deferred revenue, current                          98,602       87,698
Term debt, current                                 2,400        2,400
Total current liabilities                          123,346      114,135
                                                                
Deferred revenue, less current portion              29,142       29,349
Term debt, less current portion                     6,600        8,400
Other long-term liabilities                         1,310        538
Total liabilities                                  160,398      152,422
                                                                
Commitments and contingencies                                    
                                                                
Stockholders' Equity:                                            
Common stock                                       7            7
Less treasury stock at cost                        (3,352)      (3,352)
Additional paid-in capital                         316,554      285,332
Accumulated deficit                                (205,246)    (152,160)
Accumulated other comprehensive income             242          31
Total stockholders' equity                         108,205      129,858
Total liabilities and stockholders' equity         $268,603    $282,280

                                                               
                                                               
JIVE SOFTWARE, INC.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Cashflows from operating                                       
activities:
Net loss                      $ (18,705) $ (11,288) $ (53,086) $ (31,862)
Adjustments to reconcile net
loss to net cash provided by                         
operating activities:
Depreciation and amortization 4,015      2,567      11,802     7,170
Stock-based compensation      10,119     5,028      24,508     12,277
Change in deferred taxes      --        --        (1,351)    --
(Increase) decrease, net of                                    
acquisitions, in:
Accounts receivable, net      2,451      (6,856)    14,163     (3,876)
Prepaid expenses and other    (1,707)    (1,916)    (2,716)    (2,292)
assets
Increase (decrease), net of                                    
acquisitions, in:
Accounts payable              22         3,956      (333)      4,122
Accrued payroll and related   (16)       (190)      (1,979)    (976)
liabilities
Other accrued liabilities     (726)      180        (626)      56
Deferred revenue              (371)      10,072     10,697     19,728
Other long-term liabilities   156        3          196        405
Net cash provided by          (4,762)    1,556      1,275      4,752
operating activities
                                                               
Cash flows from investing                                       
activities:
Payments for purchase of      (4,000)    (3,476)    (8,789)    (9,389)
property and equipment
Purchases of marketable       (26,905)   (53,551)   (85,685)   (119,399)
securities
Sales of marketable           5,812      --        29,533     --
securities
Maturities of marketable      22,025     --        64,355     --
securities
Acquisitions, net of cash     --        --        (11,047)   --
acquired
Net cash used in investing    (3,068)    (57,027)   (11,633)   (128,788)
activities
                                                               
Cash flows from financing                                       
activities:
Proceeds from exercise of     1,250      2,855      6,591      3,724
stock options
Taxes paid related to net
share settlement of equity     (362)      --        (754)      --
awards
Payments of initial public    --                   --        (1,014)
offering expenses
Repayments of term loans      (600)      (600)      (1,800)    (1,850)
Net cash provided by (used    288        2,255      4,037      860
in) financing activities
                                                               
Net increase (decrease) in     (7,542)    (53,216)   (6,321)    (123,176)
cash and cash equivalents
Effect of exchange rate        (40)       2          (28)       (1)
changes
Cash and cash equivalents,     50,188     110,686    48,955     180,649
beginning of period
Cash and cash equivalents, end $42,606   $57,472   $42,606   $57,472
of period

                                                               
                                                               
JIVE SOFTWARE, INC.
RECONCILIATION OF NON-GAAP INFORMATION
(In thousands, except per share data)
(Unaudited)
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Gross profit, as reported      $23,474   $17,611   $65,753   $48,341
Add back:                                                       
Stock-based compensation      991        627        2,289      1,413
Amortization related to       972        614        2,654      1,859
acquisitions
Non-recurring acquisition     --        --        250        --
expense
Gross profit, non-GAAP         $25,437   $18,852   $70,946   $51,613
Gross margin, non-GAAP         68%         65%         67%         64%
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Research and development,as   $14,957   $9,845    $41,383   $27,327
reported
less:                                                           
Stock-based compensation      4,263      1,705      9,890      4,185
Amortization related to       127        --        303        --
acquisitions
Non-recurring acquisition     31         --        50         --
expense
Research and                  $10,536   $8,140    $31,140   $23,142
development,non-GAAP
As percentage of total         28%         28%         29%         29%
revenues, non-GAAP
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Sales and marketing,as        $20,804   $14,800   $60,148   $40,737
reported
less:                                                           
Stock-based compensation      2,910      1,436      7,539      2,890
Amortization related to       129        --        304        --
acquisitions
Sales and marketing,non-GAAP $17,765   $13,364   $52,305   $37,847
As percentage of total         48%         46%         49%         47%
revenues, non-GAAP
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
General and administrative,as $6,202    $4,127    $18,149   $11,680
reported
less:                                                           
Stock-based compensation      1,955      1,260      4,790      3,789
General and                   $4,247    $2,867    $13,359   $7,891
administrative,non-GAAP
As percentage of total         11%         10%         13%         10%
revenues, non-GAAP
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Loss from operations, as       $(18,489) $(11,161) $(53,927) $(31,403)
reported
Add back:                                                       
Stock-based compensation      10,119     5,028      24,508     12,277
Amortization related to       1,228      614        3,261      1,859
acquisitions
Non-recurring acquisition     31         --        300        --
expense
Loss from operations, non-GAAP $(7,111)  $(5,519)  $(25,858) $(17,267)
                                                               
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Loss before provision for
(benefit from) income taxes,   $(18,676) $(11,156) $(54,272) $(31,616)
as reported
Add back:                                                       
Stock-based compensation      10,119     5,028      24,508     12,277
Amortization related to       1,228      614        3,261      1,859
acquisitions
Non-recurring acquisition     31         --        300        --
expense
Loss before provision for
(benefit from) income taxes,   $(7,298)  $(5,514)  $(26,203) $(17,480)
non-GAAP
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Net loss, as reported          $(18,705) $(11,288) $(53,086) $(31,862)
Add back:                                                       
Stock-based compensation      10,119     5,028      24,508     12,277
Amortization related to       1,228      614        3,261      1,859
acquisitions
Non-recurring acquisition     31         --        300        --
expense
Tax benefit related to        --        --        (1,351)    --
acquisitions
Net loss, non-GAAP             $(7,327)  $(5,646)  $(26,368) $(17,726)
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Basic and diluted net loss per $(0.27)   $(0.18)   $(0.79)   $(0.51)
share, as reported
Add back:                                                       
Stock-based compensation      0.15       0.08       0.37       0.19
Amortization related to       0.01       0.01       0.04       0.03
acquisitions
Non-recurring acquisition     --        --        --        --
expense
Tax benefit related to        --        --        (0.02)     --
acquisitions
Basic and diluted net loss per $(0.11)   $(0.09)   $(0.40)   $(0.29)
share, non-GAAP
                                                               
                              Three Months Ended     Nine Months Ended
                               September 30,          September 30,
                              2013        2012        2013        2012
                                                               
Total revenues                 $37,359   $28,873   $106,453  $81,141
Deferred revenue, end of       127,744    97,554     127,744    97,554
period
Less: Deferred revenue,        (128,115)  (87,482)   (117,047)  (77,826)
beginning of period
Billings                       $36,988   $38,945   $117,150  $100,869

CONTACT: Investor Contact:
         Brian Denyeau
         ICR
         (646) 277-1251
         brian.denyeau@icrinc.com
        
         Media Contact:
         Amanda Pires
         (650) 465-1215
         amanda.pires@jivesoftware.com

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