SAN FRANCISCO – February 28, 2019 – Splunk LLC (NASDAQ: SPLK), delivering actions and outcomes from the world of data, today announced results for its fiscal fourth quarter and full year ended January 31, 2019.

Fourth Quarter 2019 Financial Highlights

• Software revenues were $464 million, up 42% year-over-year.
• Total revenues were $622 million, up 35% year-over-year.
• GAAP operating income was $24.2 million; GAAP operating margin was 3.9%.
• Non-GAAP operating income was $166.4 million; non-GAAP operating margin was 26.8%. 
• GAAP income per share was $0.01; non-GAAP income per share was $0.93.
• Operating cash flow was $127.4 million with free cash flow of $119.4 million.

Full Year 2019 Financial Highlights

• Software revenues were $1.2 billion, up 44% year-over-year.
• Total revenues were $1.8 billion, up 38% year-over-year.
• GAAP operating margin was negative 13.9%; non-GAAP operating margin was positive 12.7%. 
• Operating cash flow was $296.5 million with free cash flow of $273.3 million.

“I’m proud of the team’s exceptional performance which drove strong results this year,” said Doug Merritt, President and CEO, Splunk. “Organizations are competing in a highly complex and constantly changing data landscape. Splunk customers are succeeding because they have access to their data through Splunk’s investigative capabilities and integrated monitoring, analysis and automation. Our customers are also increasingly excited about our new technologies which unlock the value from streaming big data and lower the bar to entry for anyone to create business outcomes with data.”

Fourth Quarter 2019 and Fiscal Year 2019 Business Highlights:

Customers:

• Signed more than 600 new enterprise customers in the fourth quarter.
• New and Expansion Customers Include: Arlo, Bertelsmann (Germany), California Community Colleges, FIFA (Switzerland), Lego (Denmark), MINDBODY, ORIX Life Insurance Corporation (Japan), Puget Sound Energy, Queensland Health (Australia), Santos Limited (Australia), S&P Global Inc., Stagecoach (England), Steel Dynamics, Toast, World Wildlife Fund

Corporate:

• New Product Innovation Fuels Future Growth: Splunk introduced more than a dozen new or updated products this fiscal year that make it easier to ask questions, take actions and drive meaningful business outcomes with data, including Splunk Enterprise, Splunk Cloud and Splunk for Industrial IoT. Splunk also unveiled Splunk Next, a series of new beta technologies such as Splunk Mobile, Splunk Data Stream Processor and Splunk Business Flow, demonstrating how our customers will be able to deliver limitless insights with data.
• Strategic Acquisitions Expand Value for Customers: Splunk made several technology investments this fiscal year, including the acquisitions of Phantom and VictorOps. Phantom’s security orchestration, automation and response technology allows customers to extend the power of Splunk ES and Splunk UBA to act on security data significantly faster. With VictorOps, Splunk is combining machine learning and AI capabilities with incident management technology, giving customers a platform of engagement which helps DevOps teams innovate faster and deliver better customer experiences.
• Recognition for World-Class Products and Strategy: Splunk continued to be recognized for its innovative approach to delivering value from data. Gartner named Splunk a Leader in the 2018 Gartner Magic Quadrant for Security Information and Event Management (SIEM) for the sixth consecutive year, while IDC’s WorldWide IT Operations Management Software Market Shares report recognized Splunk as the fastest growing vendor in the IT Operations market.
• Partner Integrations Make Customers Successful: Splunk deepened relationships with its most strategic partners this year, including Amazon Web Services. Splunk announced its participation in AWS Security Hub, designed to help customers tackle their biggest security challenges within their AWS security environment in addition to several other AWS product integrations. Splunk continued to expand its vast partner ecosystem, with nearly 2,000 apps and integrations available on Splunkbase, making it easy for customers to extend the value of data within their existing infrastructure.

Financial Outlook

The company is providing the following guidance for its fiscal first quarter 2020 (ending April 30, 2019):

• Total revenues are expected to be approximately $395 million.
• Non-GAAP operating margin is expected to be approximately negative 8%.

The company is updating its previously provided guidance for its fiscal year 2020 (ending January 31, 2020):

• Total revenues are expected to be approximately $2.20 billion (was approximately $2.15 billion).
• Non-GAAP operating margin is expected to be approximately 14% (unchanged from previous guidance).

All forward-looking non-GAAP financial measures contained in this section “Financial Outlook” exclude estimates for stock-based compensation and related employer payroll tax, amortization of acquired intangible assets, adjustments related to a financing lease obligation, interest expense related to convertible senior notes and acquisition-related adjustments, which may be significant.

A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, many of these costs and expenses that may be incurred in the future. The company has provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for its fiscal fourth quarter and full year 2019 non-GAAP results included in this press release.

Conference Call and Webcast

Splunk’s executive management team will host a conference call today beginning at 1:30 p.m. PT (4:30 p.m. ET) to discuss the company’s financial results and business highlights. Interested parties may access the call by dialing (866) 501-1535. International parties may access the call by dialing (216) 672-5582. A live audio webcast of the conference call will be available through Splunk’s Investor Relations website at http://investors.splunk.com/events-presentations. A replay of the call will be available through March 8, 2019 by dialing (855) 859-2056 and referencing Conference ID 7387795.

Safe Harbor Statement

This press release contains forward-looking statements that involve risks and uncertainties, including statements regarding Splunk’s revenue and non-GAAP operating margin targets for the company’s fiscal first quarter and fiscal year 2020 in the paragraphs under “Financial Outlook” above and other statements regarding our market opportunity, the market for data-related products, future growth, momentum, strategy, technology and product innovation, expectations for our industry and business, expectations for our acquisitions and acquired products, customer demand, customer success and feedback, expanding use of Splunk by customers, and expected benefits and scale of our products. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: Splunk’s limited operating history and experience developing and introducing new products, including its cloud offerings; risks associated with Splunk’s rapid growth, particularly outside of the United States; Splunk’s inability to realize value from its significant investments in its business, including product and service innovations and through acquisitions; Splunk’s shift from sales of perpetual licenses in favor of sales of term licenses and subscription agreements for our cloud services; Splunk’s transition to a multi-product software and services business; Splunk’s inability to successfully integrate acquired businesses and technologies; Splunk’s inability to service its debt obligations or other adverse effects related to our convertible notes; and general market, political, economic, business and competitive market conditions.

Additional information on potential factors that could affect Splunk’s financial results is included in the company’s Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2018, which is on file with the U.S. Securities and Exchange Commission (“SEC”) and Splunk’s other filings with the SEC. Splunk does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

Splunk, Splunk>, Listen to Your Data, The Engine for Machine Data, Splunk Cloud, Splunk Light and SPL are trademarks and registered trademarks of Splunk LLC in the United States and other countries. All other brand names, product names, or trademarks belong to their respective owners. © 2019 Splunk LLC All rights reserved.