Record $164.5 Million in Total Revenues

TYSONS CORNER, Va., Jan. 28, 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 December 31, 2012 (the fourth quarter of its 2012 fiscal year).

Fourth quarter 2012 revenues were $164.5 million versus $160.3 million for the fourth quarter of 2011, a 3% increase.  Product licenses revenues for the fourth quarter of 2012 were $46.3 million versus $54.5 million for the fourth quarter of 2011, a 15% decrease.  Product support and other services revenues for MicroStrategy's core BI business for the fourth quarter of 2012 were $109.7 million versus $99.5 million for the fourth quarter of 2011, a 10% increase. 

Operating expenses for the fourth quarter of 2012 were $111.3 million versus $113.7 million for the fourth quarter of 2011, a 2% decrease.  The decrease in operating expenses was due primarily to a reduction in sales and marketing expense.

Net income for the fourth quarter of 2012 was $8.2 million, or $0.73 per share on a diluted basis, compared to $9.0 million, or $0.81 per share on a diluted basis, for the fourth quarter of 2011.

As of December 31, 2012, MicroStrategy had cash and cash equivalents of $224.4 million versus $199.6 million as of December 31, 2011, an increase of $24.8 million.  As of December 31, 2012, MicroStrategy had 9,057,303 shares of class A common stock and 2,227,327 shares of class B common stock outstanding.

Fourth Quarter Highlights in Big Data, Mobile Applications, and Cloud-based BI

In the fourth quarter of 2012, MicroStrategy continued to bolster its position as a leading worldwide provider of business intelligence and mobile software.  The company continued to offer visionary thought leadership, superior service to its customers, and disruptive new products.

MicroStrategy Announces the General Availability of Express, an Innovative New Software-as-a-Service (SaaS) Offering

In October 2012, MicroStrategy announced the general availability of Express, enabling any business person ? regardless of technical skill ? to access and analyze data on their own, and deploy powerful data-driven mobile apps to thousands of users within days.  Express combines the simplicity and flexibility of a cloud-based solution with the analytical depth, performance and scalability of world-class business intelligence.  Business people can access on-premises and cloud-based data rapidly and securely, and explore it using powerful and intuitive data visualizations.  They can design and share mobile apps without writing a line of code.  They can build boardroom-quality dashboards using pixel-perfect editing capabilities, and automatically publish personalized documents to any number of recipients.  To try the free service, visit http://www.microstrategy.com/cloud/express/.

MicroStrategy Rated #1 by Dresner Advisory Study for Second Year in a Row for Mobile Business Intelligence Offering

In November 2012, MicroStrategy announced that it has been rated the top Mobile Business Intelligence offering out of 25 product offerings in the widely followed 2012 Wisdom of Crowds® Mobile Business Intelligence Market Study® from Dresner Advisory Services.  This is the second year in a row MicroStrategy Mobile received this number one ranking.

The MicroStrategy Mobile BI platform goes above and beyond standard business intelligence to become a full mobile app development platform.  The MicroStrategy Mobile App Platform enables organizations to build a wide variety of essential mobile apps that deliver workflows, transactions, mobile operations systems access, multimedia, and business intelligence in compelling custom native apps.  The Dresner study rated MicroStrategy the top Mobile BI offering, with the highest platform score and the highest customer user rating for Mobile BI among all 25 vendors rated.

MicroStrategy Enhances Innovative Big Data Capabilities with Certified Integration to Amazon Redshift Analytical Data Warehouse Service

In November 2012, MicroStrategy announced that it certified its integration with the Amazon Redshift data warehouse service.  Launched by Amazon Web Services (AWS), Amazon Redshift is a cloud-based analytical data warehouse service designed to deliver high performance analytics for data warehouse and Big Data applications.

MicroStrategy Releases Survey Results on the Use of Tablet Computers to Support Sales Activities

In December 2012, MicroStrategy announced the results of a survey of over 500 U.S. organizations on the use of tablet computers to support sales activities across many industries.  Results of the online survey revealed that:

• Nearly one in two salespeople cite limited mobile access to key sales systems ? i.e. Customer Relationship Management (CRM), Content Management, Order Management ? as a challenge.
• C-level executives point to their respective salesforces' lack of understanding of customer needs as a major barrier to selling (75%), along with failure to keep product knowledge current (50%).
• The top five desired activities to perform on a mobile device include:  create or update opportunities, view sales collateral, view CRM records, view sales analytics, and collaborate and share ideas with other sales team members.
• Most sales organizations (72%) grade themselves at a B-level or below on sales meeting quality.  To see additional survey result detail, visit http://www.microstrategy.com/download/files/mobile/MSESurveyResults.pdf.

Examples of Customer Deals from Q4 2012

Kinross Gold Corporation

Kinross Gold Corporation (NYSE: KGC) is a Canadian-based gold mining company with mines and projects in Brazil, Canada, Chile, Ecuador, Ghana, Mauritania, Russia and the United States, employing approximately 8,000 people worldwide.  Kinross is expanding its use of the MicroStrategy Business Intelligence, Mobile and Analytics platforms to support initiatives around continuous improvement, cost management and mining productivity.  Kinross selected MicroStrategy for its integrated architecture platform, ease-of-use, and visualization and reporting capabilities.

Nielsen Holdings N.V.

Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties.  Nielsen selected MicroStrategy as its enterprise BI and Mobile software solution to provide its manufacturing, retailer and media clients with the ability to report and analyze market information for their respective products and services.

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 Business Intelligence Platform, MicroStrategy Mobile Platform, MicroStrategy Applications, MicroStrategy Express, 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, MicroStrategy Express, MicroStrategy Wisdom, MicroStrategy Alert and MicroStrategy Usher; 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.

MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
		Three Months Ended				Twelve Months Ended
		December 31,				December 31,
		2012		2011		2012		2011*
		(unaudited)		(unaudited)		(unaudited)
Revenues
Product licenses		$          46,265		$          54,502		$        147,344		$        154,574
Product support and other services		118,188		105,764		447,262		407,576
Total revenues		164,453		160,266		594,606		562,150
Cost of revenues
Product licenses		1,632		2,260		5,819		8,774
Product support and other services		38,050		35,392		146,973		133,246
Total cost of revenues		39,682		37,652		152,792		142,020
Gross profit		124,771		122,614		441,814		420,130
Operating expenses
Sales and marketing		59,230		69,125		219,845		243,029
Research and development		26,708		22,312		94,565		72,618
General and administrative		25,340		22,223		97,251		89,441
Total operating expenses		111,278		113,660		411,661		405,088
Income from operations before
financing and other income and income taxes		13,493		8,954		30,153		15,042
Financing and other (expense) income
Interest income, net		50		60		141		199
Gain on sale of investment		-		-		-		3,371
Other (expense) income, net		(1,801)		666		(1,063)		688
Total financing and other (expense) income		(1,751)		726		(922)		4,258
Income from operations before income taxes		11,742		9,680		29,231		19,300
Provision for income taxes		3,502		680		8,685		1,360
Net income		$           8,240		$           9,000		$        20,546		$        17,940
Basic earnings per share (1):		$             0.73		$             0.84		$             1.87		$             1.67
Weighted average shares outstanding used in computing basic earnings per share		11,245		10,767		10,995		10,719
Diluted earnings per share (1):		$             0.73		$             0.81		$             1.84		$             1.62
Weighted average shares outstanding used in computing diluted earnings per share		11,281		11,078		11,174		11,066
(1) Basic and fully diluted earnings per share for class A and class B common stock are the same.
*Derived from audited financial statements.

 

MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
		Core BI Business				Angel.com				Consolidated
		Three Months Ended				Three Months Ended				Three Months Ended
		December 31,				December 31,				December 31,
		2012		2011		2012		2011		2012		2011
		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Revenues
Product licenses		$             46,265		$             54,502		$                   -		$                   -		$             46,265		$             54,502
Product support and other services		109,721		99,467		-		-		109,721		99,467
Angel.com services		-		-		8,467		6,297		8,467		6,297
Total revenues		155,986		153,969		8,467		6,297		164,453		160,266
Cost of revenues
Product licenses		1,632		2,260		-		-		1,632		2,260
Product support and other services		34,807		32,539		-		-		34,807		32,539
Angel.com services		-		-		3,243		2,853		3,243		2,853
Total cost of revenues		36,439		34,799		3,243		2,853		39,682		37,652
Gross profit		119,547		119,170		5,224		3,444		124,771		122,614
Operating expenses
Sales and marketing		56,590		66,628		2,640		2,497		59,230		69,125
Research and development		25,079		20,946		1,629		1,366		26,708		22,312
General and administrative		24,192		21,288		1,148		935		25,340		22,223
Total operating expenses		105,861		108,862		5,417		4,798		111,278		113,660
Income (loss) from operations before
financing and other income and income taxes		13,686		10,308		(193)		(1,354)		13,493		8,954
Financing and other (expense) income
Interest income, net		50		60		-		-		50		60
Gain on sale of investment		-		-		-		-		-		-
Other (expense) income, net		(1,799)		709		(2)		(43)		(1,801)		666
Total financing and other (expense) income		(1,749)		769		(2)		(43)		(1,751)		726
Income (loss) from operations before income taxes		$           11,937		$           11,077		$             (195)		$          (1,397)		$           11,742		$              9,680
Provision for income taxes										3,502		680
Net income										$             8,240		$              9,000
Basic earnings per share										$               0.73		$                0.84
Weighted average shares outstanding used in computing basic earnings per share										11,245		10,767
Diluted earnings per share										$               0.73		$                0.81
Weighted average shares outstanding used in computing diluted earnings per share										11,281		11,078

 

MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
		Core BI Business				Angel.com				Consolidated
		Twelve Months Ended				Twelve Months Ended				Twelve Months Ended
		December 31,				December 31,				December 31,
		2012		2011		2012		2011		2012		2011
		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Revenues
Product licenses		$           147,344		$           154,574		$                   -		$                   -		$           147,344		$           154,574
Product support and other services		418,380		382,594		-		-		418,380		382,594
Angel.com services		-		-		28,882		24,982		28,882		24,982
Total revenues		565,724		537,168		28,882		24,982		594,606		562,150
Cost of revenues
Product licenses		5,819		8,774		-		-		5,819		8,774
Product support and other services		135,257		121,924		-		-		135,257		121,924
Angel.com services		-		-		11,716		11,322		11,716		11,322
Total cost of revenues		141,076		130,698		11,716		11,322		152,792		142,020
Gross profit		424,648		406,470		17,166		13,660		441,814		420,130
Operating expenses
Sales and marketing		209,975		231,504		9,870		11,525		219,845		243,029
Research and development		88,190		67,863		6,375		4,755		94,565		72,618
General and administrative		93,384		86,237		3,867		3,204		97,251		89,441
Total operating expenses		391,549		385,604		20,112		19,484		411,661		405,088
Income (loss) from operations before
financing and other income and income taxes		33,099		20,866		(2,946)		(5,824)		30,153		15,042
Financing and other (expense) income
Interest income (expense), net		143		199		(2)		-		141		199
Gain on sale of investment		-		3,371		-		-		-		3,371
Other (expense) income, net		(1,035)		764		(28)		(76)		(1,063)		688
Total financing and other (expense) income		(892)		4,334		(30)		(76)		(922)		4,258
Income (loss) from operations before income taxes		$           32,207		$           25,200		$          (2,976)		$          (5,900)		$           29,231		$           19,300
Provision for income taxes										8,685		1,360
Net income										$           20,546		$           17,940
Basic earnings per share										$               1.87		$                1.67
Weighted average shares outstanding used in computing basic earnings per share										10,995		10,719
Diluted earnings per share										$               1.84		$                1.62
Weighted average shares outstanding used in computing diluted earnings per share										11,174		11,066

 

MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
		December 31,		December 31,
		2012		2011*
Assets		(unaudited)
Current assets
Cash and cash equivalents		$         224,393		$         199,634
Restricted cash and short-term investments		86		289
Accounts receivable, net		93,758		94,723
Prepaid expenses and other current assets		13,288		17,043
Deferred tax assets, net		26,616		31,516
Total current assets		358,141		343,205
Property and equipment, net		100,514		95,311
Capitalized software development costs, net		10,360		7,031
Deposits and other assets		5,259		5,306
Deferred tax assets, net		3,664		2,998
Total Assets		$       477,938		$       453,851
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses		$           42,492		$           46,401
Accrued compensation and employee benefits		74,153		68,308
Deferred revenue and advance payments		101,888		103,199
Deferred tax liabilities		523		485
Total current liabilities		219,056		218,393
Deferred revenue and advance payments		8,823		10,841
Other long-term liabilities		43,517		45,141
Deferred tax liabilities		6,231		10,498
Total Liabilities		277,627		284,873
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;
15,462 shares issued and 9,057 shares outstanding, and 14,810 shares
issued and 8,405 shares outstanding, respectively		15		15
Class B common stock, $0.001 par value; 165,000 shares authorized;
2,227 and 2,378 shares issued and outstanding, respectively		2		2
Additional paid-in capital		468,087		457,837
Treasury stock, at cost; 6,405 shares		(475,184)		(475,184)
Accumulated other comprehensive loss		(1,515)		(2,052)
Retained earnings		208,906		188,360
Total Stockholders' Equity		200,311		168,978
Total Liabilities and Stockholders' Equity		$       477,938		$       453,851
*Derived from audited financial statements.

 

MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
					Twelve Months Ended
					December 31,
					2012		2011*
					(unaudited)
Operating activities:
	Net income				$      20,546		$      17,940
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization			24,519		18,526
		Bad debt expense			4,977		1,485
		Deferred taxes			(79)		(5,403)
		Gain on sale of investment			-		(3,371)
	Changes in operating assets and liabilities:
		Accounts receivable			(3,438)		(15,141)
		Prepaid expenses and other current assets			1,002		7,115
		Deposits and other assets			94		85
		Accounts payable and accrued expenses			3,154		4,775
		Accrued compensation and employee benefits			5,431		9,061
		Deferred revenue and advance payments			(3,861)		18,498
		Other long-term liabilities			(2,461)		7,244
			Net cash provided by operating activities		49,884		60,814
Investing activities:
	Proceeds from sale of investment				-		3,371
	Purchases of property and equipment				(31,116)		(40,660)
	Capitalized software development costs				(8,148)		(5,907)
	Insurance proceeds				3,206		7,065
	Decrease (increase) in restricted cash and investments				225		(51)
			Net cash used in investing activities		(35,833)		(36,182)
Financing activities:
	Proceeds from sale of class A common stock under exercise of employee stock options				10,250		2,463
	Payments on capital lease obligations				(491)		-
			Net cash provided by financing activities		9,759		2,463
Effect of foreign exchange rate changes on cash and cash equivalents					949		(1,558)
Net increase in cash and cash equivalents					24,759		25,537
Cash and cash equivalents, beginning of period					199,634		174,097
Cash and cash equivalents, end of period					$    224,393		$    199,634
*Derived from audited financial statements.

 

MSTR-F

Contact: MicroStrategy IncorporatedInvestor Relationsir@microstrategy.com(703) 848-8600

SOURCE MicroStrategy Incorporated