-- Third quarter SaaS and license revenue
increased 9.8% to $159.3 million, compared to $145.0 million
for the third quarter of 2023 -- -- Third quarter GAAP
net income attributable to common stockholders increased 87.9% to
$36.7 million, compared to $19.5 million for the third quarter of
2023 -- -- Third quarter non-GAAP adjusted EBITDA increased
20.6% to $50.0 million, compared to $41.4 million for the third
quarter of 2023 --
Alarm.com Holdings, Inc. (Nasdaq: ALRM), the leading platform
for the intelligently connected property, today reported financial
results for its third quarter ended September 30, 2024. Alarm.com
also provided its financial outlook for SaaS and license revenue
for the fourth quarter of 2024 and increased its guidance for the
full year of 2024.
Third Quarter 2024 Financial Results as Compared to Third Quarter
2023
- SaaS and license revenue increased 9.8% to $159.3 million,
compared to $145.0 million.
- Total revenue increased 8.4% to $240.5 million, compared to
$221.9 million.
- GAAP net income attributable to common stockholders increased
87.9% to $36.7 million, or $0.67 per diluted share, compared to
$19.5 million, or $0.37 per diluted share.
- Non-GAAP adjusted EBITDA(*) increased 20.6% to $50.0 million,
compared to $41.4 million.
- Non-GAAP adjusted net income attributable to common
stockholders(*) increased 14.9% to $35.2 million, or $0.62 per
diluted share, compared to $30.6 million, or $0.56 per diluted
share.
Balance Sheet and Cash
Flow
- Total cash and cash equivalents increased to $1.17 billion as
of September 30, 2024, compared to $697.0 million as of December
31, 2023. The increase in cash and cash equivalents was primarily
due to the May 2024 issuance of $500.0 million aggregate principal
amount of 2.25% convertible senior notes due June 1, 2029 in a
private placement to qualified institutional buyers, or the 2029
Notes, resulting in proceeds of $485.2 million, net of $14.8
million of transaction fees and other debt issuance costs, and to a
lesser extent, positive cash flows.
- In connection with the offering of the 2029 Notes, Alarm.com
used $63.1 million of the net proceeds from the 2029 Notes to pay
the cost of privately negotiated capped call transactions to cover
the number of shares of Alarm.com's common stock initially
underlying the 2029 Notes. Alarm.com also used $75.0 million to
repurchase 1,117,068 shares of its common stock at a per share
price of $67.14 concurrently with the pricing of the 2029
Notes.
- For the nine months ended September 30, 2024, cash flows from
operations was $150.2 million, compared to $96.1 million for the
nine months ended September 30, 2023. For the nine months ended
September 30, 2024, non-GAAP free cash flow(*) was $142.3 million,
compared to $90.7 million for the nine months ended September 30,
2023.
(*) Reconciliations of the non-GAAP measures are set forth at
the end of this press release.
Recent Business
Highlights
- OpenEye Launches New Line of Cloud Cameras: OpenEye’s
new all-in-one video camera solution provides a cost-effective and
flexible option for commercial integrators to quickly deploy
advanced video analytics capabilities. With a cloud-based
architecture, self-contained storage and onboard AI processing,
Cloud Cameras can easily scale and flexibly address the diverse
requirements of commercial customers. Offered as a
subscription-based solution, OpenEye Cloud Cameras fully leverage
the suite of management, analytics, alerting and reporting tools
offered by the OpenEye platform.
- Introduced New Gen-AI Deterrence Capability for Video
Monitoring: Alarm.com’s new AI-Deterrence (AID) capability
works with select outdoor video cameras and can identify and
automatically engage potential intruders with a neural synthesized
voice. AID adds a cost-effective advanced layer of proactive
security to Alarm.com's Remote Video Monitoring solution that
enables Alarm.com’s partners to provide professional video
monitoring and event response.
- Launched New Smart Thermostat: The Smart Thermostat HQ
includes a built-in, cellular-based smart hub that supports devices
such as light switches, water protection sensors, sump pump
monitors and other Z-Wave devices. It offers the full range of
Alarm.com’s energy-saving capabilities as well as intelligent HVAC
monitoring capabilities that detect system issues and automatically
connect subscribers to a certified HVAC service provider. Smart
Thermostat HQ is designed to provide an easy-to-install solution
for home builders, multi-family properties and other market
segments that require cost-effective property protection and
awareness solutions.
Financial Outlook
Alarm.com is providing its outlook for SaaS and license revenue
for the fourth quarter of 2024 and increasing its guidance for the
full year of 2024 based upon current management expectations.
For the fourth quarter of 2024:
- SaaS and license revenue is expected to be in the range of
$163.2 million to $163.4 million.
For the full year 2024:
- SaaS and license revenue is expected to be in the range of
$628.7 million to $628.9 million.
- Total revenue is expected to be in the range of $933.7 million
to $935.9 million, which includes anticipated hardware and other
revenue in the range of $305.0 million to $307.0 million.
- Non-GAAP adjusted EBITDA is expected to be in the range of
$174.0 million to $176.0 million.
- Non-GAAP adjusted net income attributable to common
stockholders is expected to be in the range of $125.5 million to
$126.5 million, based on an estimated tax rate of 21.0%.
- Based on an expected 57.9 million weighted average diluted
shares outstanding, non-GAAP adjusted net income attributable to
common stockholders is expected to be $2.25 to $2.27 per diluted
share.
The 2024 guidance provided above is forward-looking in nature.
Actual results may differ materially. See the cautionary note
regarding “Forward-Looking Statements” below. The guidance provided
above is based on expectations as of the date of this press release
and Alarm.com undertakes no obligation to update guidance after
such date.
Conference Call and Webcast
Information
Alarm.com will host a conference call to discuss its third
quarter 2024 financial results and its outlook for the fourth
quarter and full year 2024. A live audio webcast is scheduled to
begin at 4:30 p.m. ET on November 7, 2024. To participate on the
live call, analysts and investors should pre-register to obtain a
dial-in number and individual passcode by visiting:
https://register.vevent.com/register/BI36bc8a3a1e2b4db2b5909bebc12ebb90.
Alarm.com will also offer a live and archived webcast of the
conference call accessible on Alarm.com’s Investor Relations
website at http://investors.alarm.com. The information contained on
any referenced website is not incorporated herein.
About Alarm.com Holdings, Inc.
Alarm.com is the leading platform for the intelligently
connected property. Millions of consumers and businesses depend on
Alarm.com's technology to manage and control their property from
anywhere. Our platform integrates with a growing variety of
Internet of Things devices through our apps and interfaces. Our
security, video, access control, intelligent automation, energy
management, and wellness solutions are available through our
network of thousands of professional service providers in North
America and around the globe. Alarm.com's common stock is traded on
Nasdaq under the ticker symbol ALRM. For more information, please
visit www.alarm.com.
Non-GAAP Financial Measures
To supplement our consolidated selected financial data presented
on a basis consistent with GAAP, this press release contains
certain non-GAAP financial measures, including non-GAAP adjusted
EBITDA, non-GAAP adjusted income before income taxes, non-GAAP
adjusted net income, non-GAAP adjusted income attributable to
common stockholders before income taxes, non-GAAP adjusted net
income attributable to common stockholders, non-GAAP adjusted net
income attributable to common stockholders per share and non-GAAP
free cash flow. We have included non-GAAP measures in this press
release because they are financial, operating or liquidity measures
used by our management to (i) understand and evaluate our core
operating performance and trends and generate future operating
plans, (ii) make strategic decisions regarding the allocation of
capital and investments in initiatives that are focused on
cultivating new markets for our solutions and (iii) provide useful
information to management about the amount of cash generated by the
business after necessary capital expenditures. We also use non-GAAP
adjusted EBITDA as a performance measure under our executive bonus
plan. Further, we believe that these non-GAAP measures of our
financial results provide useful information to investors and
others in understanding and evaluating our results of operations,
business trends and financial condition. While we believe the use
of these non-GAAP measures provides useful information to investors
and management in analyzing our financial performance, non-GAAP
measures have inherent limitations in that they do not reflect all
of the amounts and transactions that are included in our financial
statements prepared in accordance with GAAP. Non-GAAP measures do
not serve as an alternative to GAAP nor do we consider our non-GAAP
measures in isolation. Accordingly, we present non-GAAP financial
measures only in connection with GAAP results. We urge investors to
consider non-GAAP measures only in conjunction with our GAAP
financials and to review the reconciliation of our non-GAAP
financial measures to the most directly comparable GAAP financial
measures, which are included in this press release.
We consider non-GAAP free cash flow to be a liquidity measure,
which we define as cash flows from operating activities less
purchases of property and equipment.
With respect to our expectations under “Financial Outlook”
above, reconciliation of non-GAAP adjusted EBITDA and non-GAAP
adjusted net income attributable to common stockholders guidance to
the closest corresponding GAAP measure is not available without
unreasonable efforts on a forward-looking basis due to the high
variability, complexity and low visibility with respect to the
charges excluded from these non-GAAP measures. In particular,
non-ordinary course litigation expense, acquisition-related expense
and tax windfall adjustments can have unpredictable fluctuations
based on unforeseen activity that is out of our control and/or
cannot reasonably be predicted. We expect the above charges to have
a significant and potentially highly variable impact on our future
GAAP financial results.
We exclude one or more of the following items from non-GAAP
financial and operating measures:
Interest expense: We record interest expense primarily related
to the January 2021 issuance of $500.0 million aggregate principal
amount of 0% convertible senior notes due January 15, 2026, or the
2026 Notes, and the 2029 Notes. We exclude interest expense in
calculating our non-GAAP adjusted EBITDA. For non-GAAP adjusted net
income, non-GAAP adjusted net income attributable to common
stockholders and non-GAAP adjusted net income attributable to
common stockholders per share, basic and diluted, we do not exclude
interest expense other than the interest expense related to the
amortization of debt issuance costs related to the 2026 Notes and
2029 Notes as discussed below.
Interest income and certain activity within other expense, net:
We exclude interest income as well as certain activity within other
expense, net including gains, losses or impairments on investments
without readily determinable fair values and other assets, gains on
settlement fees as well as losses on the early extinguishment of
the debt, when applicable, from our non-GAAP financial measures
because we do not consider it part of our ongoing results of
operations.
Provision for income taxes: We exclude the impact related to our
provision for income taxes from our non-GAAP adjusted EBITDA
calculation. We do not consider this tax adjustment to be part of
our ongoing results of operations.
Amortization expense: GAAP requires that operating expenses
include the amortization of acquired intangible assets, which
principally include acquired customer relationships, developed
technology and trade names. We exclude amortization of intangibles
from our non-GAAP financial measures because we do not consider
amortization expense when we evaluate our ongoing business
operations, nor do we factor amortization expense into our
evaluation of potential acquisitions, or our measurement of the
performance of those acquisitions. We believe that the exclusion of
amortization expense enables the comparison of our performance to
other companies in our industry as other companies may be more or
less acquisitive than we are and therefore, amortization expense
may vary significantly by company based on their acquisition
history. Although we exclude amortization of acquired intangible
assets from our non-GAAP financial measures, management believes
that it is important for investors to understand that such
intangible assets were recorded as part of purchase accounting and
contribute to revenue generation.
Depreciation expense: We record depreciation primarily for
investments in property and equipment. We exclude depreciation in
calculating non-GAAP adjusted EBITDA because we do not consider
depreciation when we evaluate our ongoing business operations. For
non-GAAP adjusted net income, non-GAAP adjusted net income
attributable to common stockholders and non-GAAP adjusted net
income attributable to common stockholders per share, basic and
diluted, we do not exclude depreciation.
Amortization of debt issuance costs: We record amortization of
debt issuance costs related to the 2026 Notes and 2029 Notes as
interest expense. We exclude amortization of debt issuance costs
from our non-GAAP adjusted net income, non-GAAP adjusted net income
attributable to common stockholders and non-GAAP adjusted net
income attributable to common stockholders per share, basic and
diluted, because we believe that the exclusion of this non-cash
interest expense will provide for more meaningful information about
our financial performance.
Stock-based compensation expense: We exclude stock-based
compensation expense, which relates to restricted stock units and
other forms of equity incentives primarily awarded to employees of
Alarm.com, because they are non-cash charges that we do not
consider when assessing the operating performance of our business.
Additionally, the determination of stock-based compensation expense
can be calculated using various methodologies and is dependent upon
subjective assumptions and other factors that vary on a
company-by-company basis. Therefore, we believe that excluding
stock-based compensation expense from our non-GAAP financial
measures improves the comparability of our results to the results
of other companies in our industry.
Acquisition-related expense: Included in operating expenses are
incremental costs directly related to business and asset
acquisitions as well as changes in the fair value of contingent
consideration liabilities, when applicable. We exclude
acquisition-related expense from our non-GAAP financial measures
because we believe that the exclusion of this expense allows us to
better provide meaningful information about our operating
performance, facilitates comparisons to our historical operating
results, improves the comparability of our results to the results
of other companies in our industry, and ultimately, we believe
helps investors better understand the acquisition-related expense
and the effects of the transaction on our results of
operations.
Litigation expense: We exclude non-ordinary course litigation
expense because we do not consider legal costs and settlement fees
incurred and received in litigation and litigation-related matters
of non-ordinary course lawsuits and other disputes, particularly
costs incurred in ongoing intellectual property litigation, to be
indicative of our core operating performance. We do not adjust for
ordinary course legal expenses, including those expenses resulting
from maintaining and enforcing our intellectual property portfolio
and license agreements.
Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements may be identified by their
use of terms and phrases such as “anticipate,” “believe,”
“continue,” “designed,” “enable,” “ensure,” “expect,” “intend,”
“will,” and other similar terms and phrases, and such
forward-looking statements include, but are not limited to, the
statements regarding the Company’s opportunities, positioning, the
benefits of recently launched offerings, acquisitions and
investments, and the Company’s guidance for the fourth quarter and
full year 2024 described under “Financial Outlook” above and key
assumptions related thereto. The events described in these
forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause actual results to
differ materially from the results anticipated by these
forward-looking statements, including, but not limited to: impact
of the global economic uncertainty and financial market conditions
caused by significant worldwide events, including public health
crises, geopolitical upheaval, such as Russia’s incursion into
Ukraine and the conflict between Israel and regional adversaries,
supply chain disruptions, interest rates and inflation
(collectively, Macroeconomic Conditions); impact of Macroeconomic
Conditions and their economic effects on demand for the Company's
products; the reliability of the Company’s network operations
centers; the Company’s ability to retain service provider partners
and residential and commercial subscribers and sustain its growth
rate; the Company’s ability to manage growth and execute on its
business strategies; the effects of increased competition and
evolving technologies; the Company’s ability to integrate acquired
assets and businesses and to manage service provider partners,
customers and employees; consumer demand for interactive security,
video monitoring, intelligent automation, energy management and
wellness solutions; the Company’s reliance on its service provider
network to attract new customers and retain existing customers; the
Company's dependence on its suppliers; the potential loss of any
key supplier or the inability of a key supplier to deliver their
products to us on time or at the contracted price; the reliability
of the Company’s hardware and wireless network suppliers and
enhanced United States tax, tariff, import/export restrictions, or
other trade barriers, particularly tariffs from China; and other
risks and uncertainties discussed in the “Risk Factors” section of
the Company’s Quarterly Report on Form 10-Q filed with the
Securities and Exchange Commission on August 8, 2024 and other
subsequent filings the Company makes with the Securities and
Exchange Commission from time to time, including its Form 10-Q for
the quarter ended September 30, 2024. In addition, the
forward-looking statements included in this press release represent
the Company’s views and expectations as of the date hereof and are
based on information currently available to the Company. The
Company anticipates that subsequent events and developments may
cause the Company’s views to change. However, while the Company may
elect to update these forward-looking statements at some point in
the future, the Company specifically disclaims any obligation to do
so except as required by law. These forward-looking statements
should not be relied upon as representing the Company’s views as of
any date subsequent to the date hereof.
ALARM.COM HOLDINGS,
INC.
Consolidated Statements of
Operations
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Revenue:
SaaS and license revenue
$
159,276
$
145,027
$
465,547
$
420,853
Hardware and other revenue
81,221
76,827
232,040
234,592
Total revenue
240,497
221,854
697,587
655,445
Cost of revenue(1):
Cost of SaaS and license revenue
23,099
21,917
65,621
63,076
Cost of hardware and other revenue
61,649
59,488
176,924
180,868
Total cost of revenue
84,748
81,405
242,545
243,944
Operating expenses:
Sales and marketing
27,010
23,861
80,301
74,278
General and administrative
25,712
31,455
81,112
88,753
Research and development
62,221
61,014
193,907
183,840
Amortization and depreciation
7,612
7,948
22,029
23,481
Total operating expenses
122,555
124,278
377,349
370,352
Operating income
33,194
16,171
77,693
41,149
Interest expense
(4,315
)
(906
)
(7,079
)
(2,601
)
Interest income
14,384
8,493
33,780
21,092
Other expense, net
(89
)
(435
)
(1,665
)
(1,214
)
Income before income taxes
43,174
23,323
102,729
58,426
Provision for income taxes
6,718
3,972
10,349
9,257
Net income
36,456
19,351
92,380
49,169
Net loss attributable to redeemable
noncontrolling interests
226
173
1,408
570
Net income attributable to common
stockholders
$
36,682
$
19,524
$
93,788
$
49,739
Per share information attributable to
common stockholders:
Net income attributable to common
stockholders per share:
Basic
$
0.74
$
0.39
$
1.89
$
1.00
Diluted
$
0.67
$
0.37
$
1.73
$
0.94
Weighted average common shares
outstanding:
Basic
49,282,514
49,917,533
49,691,263
49,782,571
Diluted
59,780,908
54,778,793
57,212,003
54,588,826
______________________________
(1) Exclusive of amortization and
depreciation shown in operating expenses below.
Stock-based compensation expense
data:
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Cost of hardware and other revenue
$
—
$
3
$
2
$
3
Sales and marketing
545
854
2,024
2,778
General and administrative
3,077
3,260
9,561
9,873
Research and development
5,572
7,689
20,088
23,769
Total stock-based compensation expense
$
9,194
$
11,806
$
31,675
$
36,423
ALARM.COM HOLDINGS,
INC.
Consolidated Balance
Sheets
(in thousands, except share
and per share data)
(unaudited)
September 30,
2024
December 31,
2023
Assets
Current assets:
Cash and cash equivalents
$
1,170,605
$
696,983
Accounts receivable, net of allowance for
credit losses of $3,847 and $3,864, and net of allowance for
product returns of $2,547 and $2,279 as of September 30, 2024 and
December 31, 2023, respectively
120,977
130,626
Inventory
75,037
96,140
Other current assets, net
46,309
33,031
Total current assets
1,412,928
956,780
Property and equipment, net
64,180
54,164
Intangible assets, net
66,044
78,564
Goodwill
154,669
154,498
Deferred tax assets
180,168
131,815
Operating lease right-of-use assets
54,109
24,242
Other assets, net of allowance for credit
losses of $1 and $5 as of September 30, 2024 and December 31, 2023,
respectively
38,900
39,500
Total assets
$
1,970,998
$
1,439,563
Liabilities, redeemable noncontrolling
interests and stockholders’ equity
Current liabilities:
Accounts payable, accrued expenses and
other current liabilities
$
115,085
$
124,475
Accrued compensation
27,578
28,626
Deferred revenue
13,114
10,193
Operating lease liabilities
7,305
12,043
Total current liabilities
163,082
175,337
Deferred revenue
13,897
12,692
Convertible senior notes, net
981,977
493,515
Operating lease liabilities
66,251
20,468
Other liabilities
14,880
12,697
Total liabilities
1,240,087
714,709
Redeemable noncontrolling interests
40,610
36,308
Stockholders’ equity
Preferred stock, $0.001 par value,
10,000,000 shares authorized; no shares issued and outstanding as
of September 30, 2024 and December 31, 2023
—
—
Common stock, $0.01 par value, 300,000,000
shares authorized; 52,469,598 and 51,888,838 shares issued; and
49,331,867 and 49,868,175 shares outstanding as of September 30,
2024 and December 31, 2023, respectively
525
519
Additional paid-in capital
514,320
531,734
Treasury stock, at cost; 3,137,731 and
2,020,663 shares as of September 30, 2024 and December 31, 2023,
respectively
(186,291
)
(111,291
)
Accumulated other comprehensive income
1,773
1,398
Retained earnings
359,974
266,186
Total stockholders’ equity
690,301
688,546
Total liabilities, redeemable
noncontrolling interests and stockholders’ equity
$
1,970,998
$
1,439,563
ALARM.COM HOLDINGS,
INC.
Consolidated Statements of
Cash Flows
(in thousands)
(unaudited)
Nine Months Ended
September 30,
Cash flows from operating
activities:
2024
2023
Net income
$
92,380
$
49,169
Adjustments to reconcile net income to net
cash flows from operating activities:
Provision for credit losses on accounts
receivable
530
1,422
Reserve for product returns
2,672
2,979
Provision for credit losses on notes
receivable
3,996
—
Inventory write-down
—
1,181
Amortization on patents and tooling
657
965
Amortization and depreciation
22,029
23,481
Amortization of debt issuance costs
3,296
2,357
Amortization of operating leases
9,425
8,540
Deferred income taxes
(32,739
)
(42,612
)
Change in fair value of contingent
liability
105
23
Stock-based compensation
31,675
36,423
Loss from investment in unconsolidated
entity
203
—
Changes in operating assets and
liabilities (net of business acquisitions):
Accounts receivable
6,425
11,048
Inventory
21,195
2,750
Other current and non-current assets
(5,034
)
6,423
Accounts payable, accrued expenses and
other current liabilities
(4,904
)
371
Deferred revenue
4,126
4,507
Operating lease liabilities
(9,171
)
(10,329
)
Other liabilities
3,287
(2,605
)
Cash flows from operating activities
150,153
96,093
Cash flows used in investing
activities:
Business acquisition, net of cash
acquired
—
(9,696
)
Additions to property and equipment
(7,865
)
(5,349
)
Issuances of notes receivable
(500
)
(300
)
Receipt of payments on notes
receivable
38
40
Capitalized software development costs
(1,128
)
(315
)
Purchase of investment in unconsolidated
entities
(7,052
)
(200
)
Purchases of other intangible assets
(46
)
(5,915
)
Cash flows used in investing
activities
(16,553
)
(21,735
)
Cash flows from / (used in) financing
activities:
Proceeds from issuance of convertible
senior notes
500,000
—
Payments of debt issuance costs
(14,834
)
—
Purchases of capped calls related to
convertible senior notes
(63,050
)
—
Payments of deferred consideration for
acquisitions
(7,269
)
(1,672
)
Purchases of treasury stock, including
transaction costs
(75,000
)
(12,854
)
Payments of tax withholdings related to
vesting of restricted stock units
(3,401
)
—
Purchases of redeemable noncontrolling
interest
—
(832
)
Payments of acquired debt
—
(3,016
)
Issuances of common stock from
equity-based plans
7,840
3,129
Cash flows from / (used in) financing
activities
344,286
(15,245
)
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(290
)
(57
)
Net increase in cash, cash equivalents
and restricted cash
477,596
59,056
Cash, cash equivalents and restricted
cash at beginning of the period
701,079
622,879
Cash, cash equivalents and restricted
cash at end of the period
$
1,178,675
$
681,935
Reconciliation of cash, cash
equivalents and restricted cash:
Cash and cash equivalents
$
1,170,605
$
679,969
Restricted cash included in other current
assets and other assets
8,070
1,966
Total cash, cash equivalents and
restricted cash
$
1,178,675
$
681,935
ALARM.COM HOLDINGS,
INC.
Reconciliation of Non-GAAP
Measures
(in thousands)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Non-GAAP adjusted EBITDA:
Net income
$
36,456
$
19,351
$
92,380
$
49,169
Adjustments:
Interest expense, interest income and
certain activity within other expense, net
(10,069
)
(7,587
)
(26,701
)
(18,491
)
Provision for income taxes
6,718
3,972
10,349
9,257
Amortization and depreciation expense
7,612
7,948
22,029
23,481
Stock-based compensation expense
9,194
11,806
31,675
36,423
Acquisition-related expense
61
(4
)
105
576
Litigation expense
4
5,949
16
7,968
Total adjustments
13,520
22,084
37,473
59,214
Non-GAAP adjusted EBITDA
$
49,976
$
41,435
$
129,853
$
108,383
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Non-GAAP adjusted net income:
Net income, as reported
$
36,456
$
19,351
$
92,380
$
49,169
Provision for income taxes
6,718
3,972
10,349
9,257
Income before income taxes
43,174
23,323
102,729
58,426
Adjustments:
Less: interest income and certain activity
within other expense, net
(14,384
)
(8,493
)
(33,780
)
(21,092
)
Amortization expense
4,753
5,190
14,154
15,076
Amortization of debt issuance costs
1,485
787
3,296
2,357
Stock-based compensation expense
9,194
11,806
31,675
36,423
Acquisition-related expense
61
(4
)
105
576
Litigation expense
4
5,949
16
7,968
Non-GAAP adjusted income before income
taxes
44,287
38,558
118,195
99,734
Income taxes 1
(9,300
)
(8,097
)
(24,821
)
(20,944
)
Non-GAAP adjusted net income
$
34,987
$
30,461
$
93,374
$
78,790
1 Income taxes are calculated using a rate
of 21.0% for each of the three and nine months ended September 30,
2024 and 2023. The 21.0% effective tax rate for each of the three
and nine months ended September 30, 2024 and 2023 excludes the
income tax effect on the non-GAAP adjustments and reflects the
estimated long-term corporate tax rate.
ALARM.COM HOLDINGS,
INC.
Reconciliation of Non-GAAP
Measures - continued
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Non-GAAP adjusted net income
attributable to common stockholders:
Net income attributable to common
stockholders, as reported
$
36,682
$
19,524
$
93,788
$
49,739
Provision for income taxes
6,718
3,972
10,349
9,257
Income attributable to common stockholders
before income taxes
43,400
23,496
104,137
58,996
Adjustments:
Less: interest income and certain activity
within other expense, net
(14,384
)
(8,493
)
(33,780
)
(21,092
)
Amortization expense
4,753
5,190
14,154
15,076
Amortization of debt issuance costs
1,485
787
3,296
2,357
Stock-based compensation expense
9,194
11,806
31,675
36,423
Acquisition-related expense
61
(4
)
105
576
Litigation expense
4
5,949
16
7,968
Non-GAAP adjusted income attributable to
common stockholders before income taxes
44,513
38,731
119,603
100,304
Income taxes 1
(9,348
)
(8,134
)
(25,117
)
(21,064
)
Non-GAAP adjusted net income
attributable to common stockholders
$
35,165
$
30,597
$
94,486
$
79,240
1 Income taxes are calculated using a rate
of 21.0% for each of the three and nine months ended September 30,
2024 and 2023. The 21.0% effective tax rate for each of the three
and nine months ended September 30, 2024 and 2023 excludes the
income tax effect on the non-GAAP adjustments and reflects the
estimated long-term corporate tax rate.
ALARM.COM HOLDINGS,
INC.
Reconciliation of Non-GAAP
Measures - continued
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Non-GAAP adjusted net income
attributable to common stockholders per share:
Net income attributable to common
stockholders per share - basic, as reported
$
0.74
$
0.39
$
1.89
$
1.00
Provision for income taxes
0.14
0.08
0.21
0.19
Income attributable to common stockholders
before income taxes
0.88
0.47
2.10
1.19
Adjustments:
Less: interest income and certain activity
within other expense, net
(0.29
)
(0.17
)
(0.68
)
(0.42
)
Amortization expense
0.10
0.10
0.28
0.30
Amortization of debt issuance costs
0.03
0.02
0.07
0.05
Stock-based compensation expense
0.18
0.23
0.64
0.73
Acquisition-related expense
—
—
—
0.01
Litigation expense
—
0.12
—
0.16
Non-GAAP adjusted income attributable to
common stockholders before income taxes
0.90
0.77
2.41
2.02
Income taxes 1
(0.19
)
(0.16
)
(0.51
)
(0.43
)
Non-GAAP adjusted net income
attributable to common stockholders per share - basic
$
0.71
$
0.61
$
1.90
$
1.59
Non-GAAP adjusted net income
attributable to common stockholders per share - diluted 2
$
0.62
$
0.56
$
1.70
$
1.45
Weighted average common shares
outstanding:
Basic, as reported
49,282,514
49,917,533
49,691,263
49,782,571
Diluted, as reported
59,780,908
54,778,793
57,212,003
54,588,826
1 Income taxes are calculated using a rate
of 21.0% for each of the three and nine months ended September 30,
2024 and 2023. The 21.0% effective tax rate for each of the three
and nine months ended September 30, 2024 and 2023 excludes the
income tax effect on the non-GAAP adjustments and reflects the
estimated long-term corporate tax rate.
2 Non-GAAP adjusted net income
attributable to common stockholders per diluted share includes the
add back of cash interest expense, net of tax, attributable to
convertible senior notes of $2.1 million and $2.8 million for the
three and nine months ended September 30, 2024, respectively.
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Non-GAAP free cash flow:
Cash flows from operating activities
$
77,337
$
62,826
$
150,153
$
96,093
Additions to property and equipment
(2,807
)
(1,956
)
(7,865
)
(5,349
)
Non-GAAP free cash flow
$
74,530
$
60,870
$
142,288
$
90,744
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107901092/en/
Investor & Media Relations: Matthew Zartman Alarm.com
ir@alarm.com
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