Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries CORRECTING and REPLACING JFrog Announces Second Quarter Fiscal 2023 Results By: JFrog Ltd. via Business Wire August 02, 2023 at 20:13 PM EDT Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform In the last bullet point of "Fiscal Year 2023 Outlook," the "Non-GAAP net income per diluted share" should be: between $0.31 and $0.33 (instead of between $0.26 and $0.28). The updated release reads: JFROG ANNOUNCES SECOND QUARTER FISCAL 2023 RESULTS Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform JFrog Ltd. (“JFrog”) (Nasdaq: FROG), the Liquid Software company and creators of the JFrog Software Supply Chain Platform, today announced financial results for its second quarter ended June 30, 2023. "The growth in our second-quarter revenue - alongside robust operating performance - demonstrates solid execution aligned with our plans. The continuous adoption of our DevOps and Security solutions as crucial enterprise infrastructure has been a driving force behind these results," stated Shlomi Ben Haim, JFrog CEO and Co-founder. "With the recent launch of JFrog Curation, natively integrated with JFrog Artifactory, Xray and Advanced Security, we have significantly enhanced our DevSecOps capabilities and are enthusiastic about further expansion of JFrog's presence in the security market." Second Quarter 2023 Financial Highlights Revenue for the second quarter of 2023 equaled $84.2 million, up 24% year-over-year. GAAP Gross Profit was $65.7 million; GAAP Gross Margin was 78.1%. Non-GAAP Gross Profit was $70.4 million; Non-GAAP Gross Margin was 83.6%. GAAP Operating Loss was ($18.9) million; GAAP Operating Margin was (22.5%). Non-GAAP Operating Income was $8.2 million; Non-GAAP Operating Margin was 9.7%. GAAP Net Loss Per Share was ($0.15); Non-GAAP Earnings Per Share was $0.11. Operating Cash Flow was $16.7 million; Free Cash Flow of $16.2 million. Cash, Cash Equivalents and Investments were $469.8 million as of June 30, 2023. Remaining performance obligations were $213.6 million as of June 30, 2023. Recent Business & Product Highlights Cloud revenue equaled $27.6 million during the second quarter of 2023, an increase of 44% year-over-year. Cloud revenue represented 33% of total revenue, compared to 28% in the year ago period. Net Dollar Retention rate for the trailing four quarters was 120%. $100K ARR customers increased to 813 customers, compared with 647 in the year ago period. $1 million ARR customers increased to 24 customers, up from 17 customers in the year ago period. Customers adopting the end-to-end JFrog Platform Enterprise+ subscription represented 45% of total revenue versus 36% in the year-ago period. Announced General Availability of JFrog Curation to prevent unwanted or malicious packages from entering an organization, protecting the software supply chain. Delivered JFrog-commissioned study from Forrester Consulting, showcasing nearly 400% ROI on JFrog Platform investments over 36 months. Third Quarter and Fiscal Year 2023 Outlook Third Quarter 2023 Outlook: Revenue between $87.0 million and $88.0 million Non-GAAP operating income between $6.0 million and $7.0 million Non-GAAP net income per diluted share between $0.08 and $0.09, assuming approximately 110 million weighted average diluted shares outstanding Fiscal Year 2023 Outlook: Revenue between $343.5 million to $345.5 million Non-GAAP operating income between $24.0 million and $25.0 million Non-GAAP net income per diluted share between $0.31 and $0.33, assuming approximately 110 million weighted average diluted shares outstanding The section titled "Non-GAAP Financial Information" below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data. Conference Call Details Event: JFrog’s Second Quarter Fiscal 2023 Financial Results Conference Call Date: Wednesday, August 2, 2023 Time: 2:00 p.m. PT (5:00 p.m. ET) A live webcast of the conference call will be accessible from the investor relations website at https://investors.jfrog.com/events-and-presentations. About JFrog JFrog Ltd. (Nasdaq: FROG), is on a mission to power all the world’s software updates, driven by a “Liquid Software” vision to allow the seamless, secure, fearless flow of binaries from developers to the edge. The JFrog Software Supply Chain Platform enables software creators to power their entire software supply chain throughout the full binary lifecycle, so they can build, secure, distribute, and connect any source with any production environment. JFrog’s hybrid, universal, multi-cloud platform is available as both self-hosted and SaaS services across major cloud service providers. Millions of users and thousands of customers worldwide, including a majority of the Fortune 100, depend on JFrog solutions to securely embrace digital transformation. Once you leap forward, you won’t go back! Learn more at jfrog.com and follow us on Twitter: @JFrog. Forward-Looking Statements: This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the U.S. federal securities laws, including but not limited to statements regarding JFrog’s future financial performance, including our outlook for the third quarter and for the full year of 2023, expectations regarding the market and revenue potential for JFrog Artifactory, JFrog Xray, JFrog Distribution, JFrog Connect and JFrog Curation , including the efficacy and benefit of integrating of any of the foregoing with other products and platform, our expectations regarding the mission-critical nature of the “JFrog Software Supply Chain Platform” to our customers’ infrastructure, the growth potential of our cloud business, including hybrid and multi-cloud, our ability to provide effective tools and solutions to detect and remediate security vulnerabilities, the ability of our strategic sales team to grow the business across top-tier accounts, our ability to expand usage of our platform in the government and commercial sectors, our ability to successfully integrate acquisitions into our business operations, including the JFrog Platform, and realize anticipated benefits and synergies from such acquisitions, our ability to contribute data to global security standards bodies, and our ability to innovate and meet market demands and the software supply chain needs of our customers. These forward-looking statements are based on JFrog’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause JFrog’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release and our earnings call, including but not limited to: risks associated with managing our rapid growth; our history of losses; our limited operating history; our ability to retain and upgrade existing customers our ability to attract new customers; our ability to effectively develop and expand our sales and marketing capabilities; our ability to integrate and realize anticipated synergies from acquisitions of complementary businesses; risk of a security breach incident or product vulnerability; risk of interruptions or performance problems associated with our products and platform capabilities; our ability to adapt and respond to rapidly changing technology or customer needs; our ability to compete in the markets in which we participate; our ability to successfully integrate technology from acquisitions, into our offerings; our ability to provide continuity to our respective customers and realize innovation following our acquisitions,; general market, political, economic, and business conditions; and the duration and impact of the COVID-19 pandemic. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in our filings with the Securities and Exchange Commission, including in our annual report on Form 10-K for the year ended December 31, 2022, our quarterly reports on Form 10-Q, and other filings and reports that we may file from time to time with the Securities and Exchange Commission. Forward-looking statements represent our beliefs and assumptions only as of the date of this press release. We disclaim any obligation to update forward-looking statements. About Non-GAAP Financial Measures: JFrog discloses the following non-GAAP financial measures in this release and the earnings call referencing this press release: non-GAAP operating income (loss), non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per diluted share, non-GAAP net income (loss) per basic share, and free cash flow. JFrog uses each of these non-GAAP financial measures internally to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, for short- and long-term operating plans, and to evaluate JFrog’s financial performance. JFrog believes they are useful to investors, as a supplement to GAAP measures, in evaluating its operational performance, as further discussed below. JFrog’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on JFrog’s reported financial results. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release. 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, reconciling items that may be incurred in the future such as share-based compensation, the effect of which may be significant. JFrog defines non-GAAP gross profit, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating income (loss) and non-GAAP net income (loss) as the respective GAAP balances, adjusted for, as applicable: (1) share-based compensation expense; (2) the amortization of acquired intangibles; (3) acquisition-related costs; (4) legal settlement costs and (5) income tax effects. JFrog defines free cash flow as Net cash provided by (used in) operating activities, minus capital expenditures. Investors are encouraged to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures. Management believes these non-GAAP financial measures are useful to investors and others in assessing JFrog’s operating performance due to the following factors: Share-based compensation. JFrog utilizes share-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of its shareholders and at long-term retention, rather than to address operational performance for any particular period. As a result, share-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period. Amortization of acquired intangibles. JFrog views amortization of acquired intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of acquired intangibles is an expense that is not typically affected by operations during any particular period. Acquisition-related costs. Acquisition-related costs include expenses related to acquisitions of other companies. JFrog views acquisition-related costs as expenses that are not necessarily reflective of operational performance during a period. Legal settlement costs. From time-to-time JFrog incurs charges related to litigation settlements. We exclude these charges and related professional service costs when associated with a significant settlement because they are not reflective of JFrog’s ongoing business and operating results. Income tax effects. JFrog’s non-GAAP financial results are adjusted for income tax effects related to these non-GAAP adjustments and changes in our assessment regarding the realizability of our deferred tax assets, if any. Excluding income tax effects of non-GAAP adjustments provides a more accurate view of JFrog’s operating results. Non-GAAP weighted average share count. Diluted GAAP and non-GAAP weighted-average shares are the same, except in periods that there is a GAAP loss and a non-GAAP income. The non-GAAP weighted-average shares used to compute the non-GAAP net income per share - diluted are adjusted to reflect dilution equal to the dilutive impact had there been GAAP income. Additionally, JFrog’s management believes that the non-GAAP financial measure, free cash flow, is meaningful to investors because management reviews cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered to be a necessary component of ongoing operations. Operating Metrics JFrog’s number of customers with annual recurring revenue (“ARR”) of $100,000 or more is based on the ARR of each customer, as of the last month of the quarter. JFrog’s number of customers with ARR of $1 million or more is based on the ARR of each customer, as of the last month of the quarter. JFrog defines ARR as the annualized revenue run-rate of subscription agreements from all customers as of the last month of the quarter. The ARR includes monthly subscription customers, so long as JFrog generates revenue from these customers. JFrog annualizes its monthly subscriptions by taking the revenue it would contractually expect to receive from such customers in a given month and multiplying it by 12. JFrog’s net dollar retention rate compares its ARR from the same set of customers across comparable periods. JFrog calculates net dollar retention rate by first identifying customers (the “Base Customers”), which were customers in the last month of a particular quarter (the “Base Quarter”). JFrog then calculates the contracted ARR from these Base Customers in the last month of the same quarter of the subsequent year (the “Comparison Quarter”). This calculation captures upsells, contraction, and attrition since the Base Quarter. JFrog then divides total Comparison Quarter ARR by total Base Quarter ARR for Base Customers. JFrog’s net dollar retention rate in a particular quarter is obtained by averaging the result from that particular quarter with the corresponding results from each of the prior three quarters. JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Revenue: Subscription—self-managed and SaaS $ 79,467 $ 63,679 $ 154,010 $ 122,748 License—self-managed 4,703 4,128 9,980 8,755 Total subscription revenue 84,170 67,807 163,990 131,503 Cost of revenue: Subscription—self-managed and SaaS(1)(2)(3) 18,231 15,024 36,434 28,667 License—self-managed(3) 218 220 436 440 Total cost of revenue—subscription 18,449 15,244 36,870 29,107 Gross profit 65,721 52,563 127,120 102,396 Operating expenses: Research and development(1)(2) 33,544 28,945 68,430 56,046 Sales and marketing(1)(2)(3) 36,352 31,991 71,838 61,171 General and administrative(1)(2)(4) 14,732 14,037 28,972 26,728 Total operating expenses 84,628 74,973 169,240 143,945 Operating loss (18,907 ) (22,410 ) (42,120 ) (41,549 ) Interest and other income, net 4,896 517 8,888 790 Loss before income taxes (14,011 ) (21,893 ) (33,232 ) (40,759 ) Income tax expense 1,456 1,880 3,044 2,718 Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Net loss per share, basic and diluted $ (0.15 ) $ (0.24 ) $ (0.36 ) $ (0.44 ) Weighted-average shares used in computing net loss per share, basic and diluted 102,513 98,956 101,890 98,423 (1) Includes share-based compensation expense as follows: Cost of revenue: subscription—self-managed and SaaS $ 2,019 $ 1,613 $ 4,215 $ 2,919 Research and development 7,798 5,330 14,970 10,462 Sales and marketing 6,740 4,792 13,213 9,547 General and administrative 4,765 3,342 8,836 6,223 Total share-based compensation expense $ 21,322 $ 15,077 $ 41,234 $ 29,151 (2) Includes acquisition-related costs as follows: Cost of revenue: subscription–self-managed and SaaS $ 5 $ 6 $ 10 $ 13 Research and development 2,745 2,149 5,680 4,524 Sales and marketing — 112 70 236 General and administrative 64 68 140 234 Total acquisition-related costs $ 2,814 $ 2,335 $ 5,900 $ 5,007 (3) Includes amortization of acquired intangibles as follows: Cost of revenue: subscription–self-managed and SaaS $ 2,387 $ 2,386 $ 4,774 $ 4,772 Cost of revenue: license—self-managed 218 220 436 440 Sales and marketing 358 236 716 472 Total amortization expense of acquired intangible assets $ 2,963 $ 2,842 $ 5,926 $ 5,684 (4) Includes legal settlement costs as follows: General and administrative $ — $ 122 $ — $ 216 JFROG LTD. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands; unaudited) June 30, 2023 December 31, 2022 Assets Current assets: Cash and cash equivalents $ 46,694 $ 45,595 Short-term investments 423,100 397,605 Accounts receivable, net 62,498 62,117 Deferred contract acquisition costs 9,063 8,102 Prepaid expenses and other current assets 16,955 18,603 Total current assets 558,310 532,022 Property and equipment, net 7,028 8,021 Deferred contract acquisition costs, noncurrent 14,134 13,501 Operating lease right-of-use assets 27,361 24,602 Intangible assets, net 31,618 37,544 Goodwill 247,955 247,955 Other assets, noncurrent 8,715 7,576 Total assets $ 895,121 $ 871,221 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ 13,097 $ 14,867 Accrued expenses and other current liabilities 31,724 28,848 Operating lease liabilities 8,272 7,132 Deferred revenue 170,967 158,725 Total current liabilities 224,060 209,572 Deferred revenue, noncurrent 13,441 16,990 Operating lease liabilities, noncurrent 18,241 16,829 Other liabilities, noncurrent 3,487 3,057 Total liabilities 259,229 246,448 Shareholders’ equity: Share capital 290 283 Additional paid-in capital 904,531 856,438 Accumulated other comprehensive loss (3,477 ) (2,772 ) Accumulated deficit (265,452 ) (229,176 ) Total shareholders’ equity 635,892 624,773 Total liabilities and shareholders’ equity $ 895,121 $ 871,221 JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Cash flows from operating activities: Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 3,828 3,572 7,675 7,091 Share-based compensation expense 21,322 15,077 41,234 29,151 Non-cash operating lease expense 2,123 1,796 4,145 3,602 Net amortization of premium or discount on investments (1,582 ) 760 (2,870 ) 2,388 Gain on foreign exchange (224 ) — (591 ) — Changes in operating assets and liabilities: Accounts receivable 617 (3,615 ) (221 ) (2,521 ) Prepaid expenses and other assets 1,153 5,025 (1,961 ) 4,136 Deferred contract acquisition costs (801 ) (1,549 ) (1,594 ) (3,606 ) Accounts payable (827 ) 1,267 (1,913 ) 2,227 Accrued expenses and other liabilities 2,620 3,933 3,030 5,457 Operating lease liabilities (2,033 ) (3,225 ) (3,770 ) (5,426 ) Deferred revenue 5,981 4,684 8,693 9,961 Net cash provided by operating activities 16,710 3,952 15,581 8,983 Cash flows from investing activities: Purchases of short-term investments (81,356 ) (89,068 ) (204,572 ) (181,279 ) Maturities and sales of short-term investments 68,845 81,232 183,171 155,869 Purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Payments related to business combinations — — — (179 ) Net cash used in investing activities (13,018 ) (8,824 ) (22,174 ) (27,720 ) Cash flows from financing activities: Proceeds from exercise of share options 2,211 1,078 3,367 2,873 Proceeds from employee share purchase plan — — 3,499 3,253 Proceeds from employee equity transactions, net of payments to tax authorities 520 (602 ) 817 (495 ) Net cash provided by financing activities 2,731 476 7,683 5,631 Effect of exchange rate changes on cash, cash equivalents and restricted cash (75 ) — 9 — Net increase (decrease) in cash, cash equivalents, and restricted cash 6,348 (4,396 ) 1,099 (13,106 ) Cash, cash equivalents, and restricted cash—beginning of period 40,358 59,830 45,607 68,540 Cash, cash equivalents, and restricted cash—end of period $ 46,706 $ 55,434 $ 46,706 $ 55,434 Reconciliation of cash, cash equivalents, and restricted cash within the Condensed Consolidated Balance Sheets to the amounts shown in the Condensed Consolidated Statements of Cash Flows above: Cash and cash equivalents $ 46,694 $ 55,194 $ 46,694 $ 55,194 Restricted cash included in prepaid expenses and other current assets 12 13 12 13 Restricted cash included in other assets, noncurrent — 227 — 227 Total cash, cash equivalents, and restricted cash $ 46,706 $ 55,434 $ 46,706 $ 55,434 JFROG LTD. RECONCILIATION OF GAAP TO NON-GAAP RESULTS (in thousands except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Reconciliation of gross profit and gross margin GAAP gross profit $ 65,721 $ 52,563 $ 127,120 $ 102,396 Plus: Share-based compensation expense 2,019 1,613 4,215 2,919 Plus: Acquisition-related costs 5 6 10 13 Plus: Amortization of acquired intangibles 2,605 2,606 5,210 5,212 Non-GAAP gross profit $ 70,350 $ 56,788 $ 136,555 $ 110,540 GAAP gross margin 78.1 % 77.5 % 77.5 % 77.9 % Non-GAAP gross margin 83.6 % 83.7 % 83.3 % 84.1 % Reconciliation of operating expenses GAAP research and development $ 33,544 $ 28,945 $ 68,430 $ 56,046 Less: Share-based compensation expense (7,798 ) (5,330 ) (14,970 ) (10,462 ) Less: Acquisition-related costs (2,745 ) (2,149 ) (5,680 ) (4,524 ) Non-GAAP research and development $ 23,001 $ 21,466 $ 47,780 $ 41,060 GAAP sales and marketing $ 36,352 $ 31,991 $ 71,838 $ 61,171 Less: Share-based compensation expense (6,740 ) (4,792 ) (13,213 ) (9,547 ) Less: Acquisition-related costs — (112 ) (70 ) (236 ) Less: Amortization of acquired intangibles (358 ) (236 ) (716 ) (472 ) Non-GAAP sales and marketing $ 29,254 $ 26,851 $ 57,839 $ 50,916 GAAP general and administrative $ 14,732 $ 14,037 $ 28,972 $ 26,728 Less: Share-based compensation expense (4,765 ) (3,342 ) (8,836 ) (6,223 ) Less: Acquisition-related costs (64 ) (68 ) (140 ) (234 ) Less: Legal settlement costs — (122 ) — (216 ) Non-GAAP general and administrative $ 9,903 $ 10,505 $ 19,996 $ 20,055 Reconciliation of operating income (loss) and operating margin GAAP operating loss $ (18,907 ) $ (22,410 ) $ (42,120 ) $ (41,549 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Non-GAAP operating income (loss) $ 8,192 $ (2,034 ) $ 10,940 $ (1,491 ) GAAP operating margin (22.5 )% (33.0 )% (25.7 )% (31.6 )% Non-GAAP operating margin 9.7 % (3.0 )% 6.7 % (1.1 )% Reconciliation of net income (loss) GAAP net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Less: Income tax effects 460 1,201 1,238 1,381 Non-GAAP net income (loss) $ 12,092 $ (2,196 ) $ 18,022 $ (2,038 ) Net income (loss) per share - basic $ 0.12 $ (0.02 ) $ 0.18 $ (0.02 ) Net income (loss) per share - diluted $ 0.11 $ (0.02 ) $ 0.17 $ (0.02 ) Shares used in non-GAAP net income (loss) per share calculations: GAAP weighted-average shares used to compute net loss per share - basic and diluted 102,513 98,956 101,890 98,423 Add: Dilutive ordinary share equivalents(1) 5,580 — 5,589 — Non-GAAP weighted-average shares used to compute net income (loss) per share - diluted 108,093 98,956 107,479 98,423 (1) Potentially dilutive shares are excluded in calculating the non-GAAP diluted shares for the three and six months ended June 30, 2022 as the inclusion of such shares would have been anti-dilutive due to net loss in these periods. JFROG LTD. RECONCILIATION OF GAAP CASH FLOW FROM OPERATING ACTIVITIES TO FREE CASH FLOW (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net cash provided by operating activities $ 16,710 $ 3,952 $ 15,581 $ 8,983 Less: purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Free cash flow $ 16,203 $ 2,964 $ 14,808 $ 6,852 View source version on businesswire.com: https://www.businesswire.com/news/home/20230802058323/en/Contacts Investor Contact: Jeff Schreiner jeffs@jfrog.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
CORRECTING and REPLACING JFrog Announces Second Quarter Fiscal 2023 Results By: JFrog Ltd. via Business Wire August 02, 2023 at 20:13 PM EDT Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform In the last bullet point of "Fiscal Year 2023 Outlook," the "Non-GAAP net income per diluted share" should be: between $0.31 and $0.33 (instead of between $0.26 and $0.28). The updated release reads: JFROG ANNOUNCES SECOND QUARTER FISCAL 2023 RESULTS Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform JFrog Ltd. (“JFrog”) (Nasdaq: FROG), the Liquid Software company and creators of the JFrog Software Supply Chain Platform, today announced financial results for its second quarter ended June 30, 2023. "The growth in our second-quarter revenue - alongside robust operating performance - demonstrates solid execution aligned with our plans. The continuous adoption of our DevOps and Security solutions as crucial enterprise infrastructure has been a driving force behind these results," stated Shlomi Ben Haim, JFrog CEO and Co-founder. "With the recent launch of JFrog Curation, natively integrated with JFrog Artifactory, Xray and Advanced Security, we have significantly enhanced our DevSecOps capabilities and are enthusiastic about further expansion of JFrog's presence in the security market." Second Quarter 2023 Financial Highlights Revenue for the second quarter of 2023 equaled $84.2 million, up 24% year-over-year. GAAP Gross Profit was $65.7 million; GAAP Gross Margin was 78.1%. Non-GAAP Gross Profit was $70.4 million; Non-GAAP Gross Margin was 83.6%. GAAP Operating Loss was ($18.9) million; GAAP Operating Margin was (22.5%). Non-GAAP Operating Income was $8.2 million; Non-GAAP Operating Margin was 9.7%. GAAP Net Loss Per Share was ($0.15); Non-GAAP Earnings Per Share was $0.11. Operating Cash Flow was $16.7 million; Free Cash Flow of $16.2 million. Cash, Cash Equivalents and Investments were $469.8 million as of June 30, 2023. Remaining performance obligations were $213.6 million as of June 30, 2023. Recent Business & Product Highlights Cloud revenue equaled $27.6 million during the second quarter of 2023, an increase of 44% year-over-year. Cloud revenue represented 33% of total revenue, compared to 28% in the year ago period. Net Dollar Retention rate for the trailing four quarters was 120%. $100K ARR customers increased to 813 customers, compared with 647 in the year ago period. $1 million ARR customers increased to 24 customers, up from 17 customers in the year ago period. Customers adopting the end-to-end JFrog Platform Enterprise+ subscription represented 45% of total revenue versus 36% in the year-ago period. Announced General Availability of JFrog Curation to prevent unwanted or malicious packages from entering an organization, protecting the software supply chain. Delivered JFrog-commissioned study from Forrester Consulting, showcasing nearly 400% ROI on JFrog Platform investments over 36 months. Third Quarter and Fiscal Year 2023 Outlook Third Quarter 2023 Outlook: Revenue between $87.0 million and $88.0 million Non-GAAP operating income between $6.0 million and $7.0 million Non-GAAP net income per diluted share between $0.08 and $0.09, assuming approximately 110 million weighted average diluted shares outstanding Fiscal Year 2023 Outlook: Revenue between $343.5 million to $345.5 million Non-GAAP operating income between $24.0 million and $25.0 million Non-GAAP net income per diluted share between $0.31 and $0.33, assuming approximately 110 million weighted average diluted shares outstanding The section titled "Non-GAAP Financial Information" below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data. Conference Call Details Event: JFrog’s Second Quarter Fiscal 2023 Financial Results Conference Call Date: Wednesday, August 2, 2023 Time: 2:00 p.m. PT (5:00 p.m. ET) A live webcast of the conference call will be accessible from the investor relations website at https://investors.jfrog.com/events-and-presentations. About JFrog JFrog Ltd. (Nasdaq: FROG), is on a mission to power all the world’s software updates, driven by a “Liquid Software” vision to allow the seamless, secure, fearless flow of binaries from developers to the edge. The JFrog Software Supply Chain Platform enables software creators to power their entire software supply chain throughout the full binary lifecycle, so they can build, secure, distribute, and connect any source with any production environment. JFrog’s hybrid, universal, multi-cloud platform is available as both self-hosted and SaaS services across major cloud service providers. Millions of users and thousands of customers worldwide, including a majority of the Fortune 100, depend on JFrog solutions to securely embrace digital transformation. Once you leap forward, you won’t go back! Learn more at jfrog.com and follow us on Twitter: @JFrog. Forward-Looking Statements: This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the U.S. federal securities laws, including but not limited to statements regarding JFrog’s future financial performance, including our outlook for the third quarter and for the full year of 2023, expectations regarding the market and revenue potential for JFrog Artifactory, JFrog Xray, JFrog Distribution, JFrog Connect and JFrog Curation , including the efficacy and benefit of integrating of any of the foregoing with other products and platform, our expectations regarding the mission-critical nature of the “JFrog Software Supply Chain Platform” to our customers’ infrastructure, the growth potential of our cloud business, including hybrid and multi-cloud, our ability to provide effective tools and solutions to detect and remediate security vulnerabilities, the ability of our strategic sales team to grow the business across top-tier accounts, our ability to expand usage of our platform in the government and commercial sectors, our ability to successfully integrate acquisitions into our business operations, including the JFrog Platform, and realize anticipated benefits and synergies from such acquisitions, our ability to contribute data to global security standards bodies, and our ability to innovate and meet market demands and the software supply chain needs of our customers. These forward-looking statements are based on JFrog’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause JFrog’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release and our earnings call, including but not limited to: risks associated with managing our rapid growth; our history of losses; our limited operating history; our ability to retain and upgrade existing customers our ability to attract new customers; our ability to effectively develop and expand our sales and marketing capabilities; our ability to integrate and realize anticipated synergies from acquisitions of complementary businesses; risk of a security breach incident or product vulnerability; risk of interruptions or performance problems associated with our products and platform capabilities; our ability to adapt and respond to rapidly changing technology or customer needs; our ability to compete in the markets in which we participate; our ability to successfully integrate technology from acquisitions, into our offerings; our ability to provide continuity to our respective customers and realize innovation following our acquisitions,; general market, political, economic, and business conditions; and the duration and impact of the COVID-19 pandemic. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in our filings with the Securities and Exchange Commission, including in our annual report on Form 10-K for the year ended December 31, 2022, our quarterly reports on Form 10-Q, and other filings and reports that we may file from time to time with the Securities and Exchange Commission. Forward-looking statements represent our beliefs and assumptions only as of the date of this press release. We disclaim any obligation to update forward-looking statements. About Non-GAAP Financial Measures: JFrog discloses the following non-GAAP financial measures in this release and the earnings call referencing this press release: non-GAAP operating income (loss), non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per diluted share, non-GAAP net income (loss) per basic share, and free cash flow. JFrog uses each of these non-GAAP financial measures internally to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, for short- and long-term operating plans, and to evaluate JFrog’s financial performance. JFrog believes they are useful to investors, as a supplement to GAAP measures, in evaluating its operational performance, as further discussed below. JFrog’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on JFrog’s reported financial results. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release. 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, reconciling items that may be incurred in the future such as share-based compensation, the effect of which may be significant. JFrog defines non-GAAP gross profit, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating income (loss) and non-GAAP net income (loss) as the respective GAAP balances, adjusted for, as applicable: (1) share-based compensation expense; (2) the amortization of acquired intangibles; (3) acquisition-related costs; (4) legal settlement costs and (5) income tax effects. JFrog defines free cash flow as Net cash provided by (used in) operating activities, minus capital expenditures. Investors are encouraged to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures. Management believes these non-GAAP financial measures are useful to investors and others in assessing JFrog’s operating performance due to the following factors: Share-based compensation. JFrog utilizes share-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of its shareholders and at long-term retention, rather than to address operational performance for any particular period. As a result, share-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period. Amortization of acquired intangibles. JFrog views amortization of acquired intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of acquired intangibles is an expense that is not typically affected by operations during any particular period. Acquisition-related costs. Acquisition-related costs include expenses related to acquisitions of other companies. JFrog views acquisition-related costs as expenses that are not necessarily reflective of operational performance during a period. Legal settlement costs. From time-to-time JFrog incurs charges related to litigation settlements. We exclude these charges and related professional service costs when associated with a significant settlement because they are not reflective of JFrog’s ongoing business and operating results. Income tax effects. JFrog’s non-GAAP financial results are adjusted for income tax effects related to these non-GAAP adjustments and changes in our assessment regarding the realizability of our deferred tax assets, if any. Excluding income tax effects of non-GAAP adjustments provides a more accurate view of JFrog’s operating results. Non-GAAP weighted average share count. Diluted GAAP and non-GAAP weighted-average shares are the same, except in periods that there is a GAAP loss and a non-GAAP income. The non-GAAP weighted-average shares used to compute the non-GAAP net income per share - diluted are adjusted to reflect dilution equal to the dilutive impact had there been GAAP income. Additionally, JFrog’s management believes that the non-GAAP financial measure, free cash flow, is meaningful to investors because management reviews cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered to be a necessary component of ongoing operations. Operating Metrics JFrog’s number of customers with annual recurring revenue (“ARR”) of $100,000 or more is based on the ARR of each customer, as of the last month of the quarter. JFrog’s number of customers with ARR of $1 million or more is based on the ARR of each customer, as of the last month of the quarter. JFrog defines ARR as the annualized revenue run-rate of subscription agreements from all customers as of the last month of the quarter. The ARR includes monthly subscription customers, so long as JFrog generates revenue from these customers. JFrog annualizes its monthly subscriptions by taking the revenue it would contractually expect to receive from such customers in a given month and multiplying it by 12. JFrog’s net dollar retention rate compares its ARR from the same set of customers across comparable periods. JFrog calculates net dollar retention rate by first identifying customers (the “Base Customers”), which were customers in the last month of a particular quarter (the “Base Quarter”). JFrog then calculates the contracted ARR from these Base Customers in the last month of the same quarter of the subsequent year (the “Comparison Quarter”). This calculation captures upsells, contraction, and attrition since the Base Quarter. JFrog then divides total Comparison Quarter ARR by total Base Quarter ARR for Base Customers. JFrog’s net dollar retention rate in a particular quarter is obtained by averaging the result from that particular quarter with the corresponding results from each of the prior three quarters. JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Revenue: Subscription—self-managed and SaaS $ 79,467 $ 63,679 $ 154,010 $ 122,748 License—self-managed 4,703 4,128 9,980 8,755 Total subscription revenue 84,170 67,807 163,990 131,503 Cost of revenue: Subscription—self-managed and SaaS(1)(2)(3) 18,231 15,024 36,434 28,667 License—self-managed(3) 218 220 436 440 Total cost of revenue—subscription 18,449 15,244 36,870 29,107 Gross profit 65,721 52,563 127,120 102,396 Operating expenses: Research and development(1)(2) 33,544 28,945 68,430 56,046 Sales and marketing(1)(2)(3) 36,352 31,991 71,838 61,171 General and administrative(1)(2)(4) 14,732 14,037 28,972 26,728 Total operating expenses 84,628 74,973 169,240 143,945 Operating loss (18,907 ) (22,410 ) (42,120 ) (41,549 ) Interest and other income, net 4,896 517 8,888 790 Loss before income taxes (14,011 ) (21,893 ) (33,232 ) (40,759 ) Income tax expense 1,456 1,880 3,044 2,718 Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Net loss per share, basic and diluted $ (0.15 ) $ (0.24 ) $ (0.36 ) $ (0.44 ) Weighted-average shares used in computing net loss per share, basic and diluted 102,513 98,956 101,890 98,423 (1) Includes share-based compensation expense as follows: Cost of revenue: subscription—self-managed and SaaS $ 2,019 $ 1,613 $ 4,215 $ 2,919 Research and development 7,798 5,330 14,970 10,462 Sales and marketing 6,740 4,792 13,213 9,547 General and administrative 4,765 3,342 8,836 6,223 Total share-based compensation expense $ 21,322 $ 15,077 $ 41,234 $ 29,151 (2) Includes acquisition-related costs as follows: Cost of revenue: subscription–self-managed and SaaS $ 5 $ 6 $ 10 $ 13 Research and development 2,745 2,149 5,680 4,524 Sales and marketing — 112 70 236 General and administrative 64 68 140 234 Total acquisition-related costs $ 2,814 $ 2,335 $ 5,900 $ 5,007 (3) Includes amortization of acquired intangibles as follows: Cost of revenue: subscription–self-managed and SaaS $ 2,387 $ 2,386 $ 4,774 $ 4,772 Cost of revenue: license—self-managed 218 220 436 440 Sales and marketing 358 236 716 472 Total amortization expense of acquired intangible assets $ 2,963 $ 2,842 $ 5,926 $ 5,684 (4) Includes legal settlement costs as follows: General and administrative $ — $ 122 $ — $ 216 JFROG LTD. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands; unaudited) June 30, 2023 December 31, 2022 Assets Current assets: Cash and cash equivalents $ 46,694 $ 45,595 Short-term investments 423,100 397,605 Accounts receivable, net 62,498 62,117 Deferred contract acquisition costs 9,063 8,102 Prepaid expenses and other current assets 16,955 18,603 Total current assets 558,310 532,022 Property and equipment, net 7,028 8,021 Deferred contract acquisition costs, noncurrent 14,134 13,501 Operating lease right-of-use assets 27,361 24,602 Intangible assets, net 31,618 37,544 Goodwill 247,955 247,955 Other assets, noncurrent 8,715 7,576 Total assets $ 895,121 $ 871,221 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ 13,097 $ 14,867 Accrued expenses and other current liabilities 31,724 28,848 Operating lease liabilities 8,272 7,132 Deferred revenue 170,967 158,725 Total current liabilities 224,060 209,572 Deferred revenue, noncurrent 13,441 16,990 Operating lease liabilities, noncurrent 18,241 16,829 Other liabilities, noncurrent 3,487 3,057 Total liabilities 259,229 246,448 Shareholders’ equity: Share capital 290 283 Additional paid-in capital 904,531 856,438 Accumulated other comprehensive loss (3,477 ) (2,772 ) Accumulated deficit (265,452 ) (229,176 ) Total shareholders’ equity 635,892 624,773 Total liabilities and shareholders’ equity $ 895,121 $ 871,221 JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Cash flows from operating activities: Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 3,828 3,572 7,675 7,091 Share-based compensation expense 21,322 15,077 41,234 29,151 Non-cash operating lease expense 2,123 1,796 4,145 3,602 Net amortization of premium or discount on investments (1,582 ) 760 (2,870 ) 2,388 Gain on foreign exchange (224 ) — (591 ) — Changes in operating assets and liabilities: Accounts receivable 617 (3,615 ) (221 ) (2,521 ) Prepaid expenses and other assets 1,153 5,025 (1,961 ) 4,136 Deferred contract acquisition costs (801 ) (1,549 ) (1,594 ) (3,606 ) Accounts payable (827 ) 1,267 (1,913 ) 2,227 Accrued expenses and other liabilities 2,620 3,933 3,030 5,457 Operating lease liabilities (2,033 ) (3,225 ) (3,770 ) (5,426 ) Deferred revenue 5,981 4,684 8,693 9,961 Net cash provided by operating activities 16,710 3,952 15,581 8,983 Cash flows from investing activities: Purchases of short-term investments (81,356 ) (89,068 ) (204,572 ) (181,279 ) Maturities and sales of short-term investments 68,845 81,232 183,171 155,869 Purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Payments related to business combinations — — — (179 ) Net cash used in investing activities (13,018 ) (8,824 ) (22,174 ) (27,720 ) Cash flows from financing activities: Proceeds from exercise of share options 2,211 1,078 3,367 2,873 Proceeds from employee share purchase plan — — 3,499 3,253 Proceeds from employee equity transactions, net of payments to tax authorities 520 (602 ) 817 (495 ) Net cash provided by financing activities 2,731 476 7,683 5,631 Effect of exchange rate changes on cash, cash equivalents and restricted cash (75 ) — 9 — Net increase (decrease) in cash, cash equivalents, and restricted cash 6,348 (4,396 ) 1,099 (13,106 ) Cash, cash equivalents, and restricted cash—beginning of period 40,358 59,830 45,607 68,540 Cash, cash equivalents, and restricted cash—end of period $ 46,706 $ 55,434 $ 46,706 $ 55,434 Reconciliation of cash, cash equivalents, and restricted cash within the Condensed Consolidated Balance Sheets to the amounts shown in the Condensed Consolidated Statements of Cash Flows above: Cash and cash equivalents $ 46,694 $ 55,194 $ 46,694 $ 55,194 Restricted cash included in prepaid expenses and other current assets 12 13 12 13 Restricted cash included in other assets, noncurrent — 227 — 227 Total cash, cash equivalents, and restricted cash $ 46,706 $ 55,434 $ 46,706 $ 55,434 JFROG LTD. RECONCILIATION OF GAAP TO NON-GAAP RESULTS (in thousands except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Reconciliation of gross profit and gross margin GAAP gross profit $ 65,721 $ 52,563 $ 127,120 $ 102,396 Plus: Share-based compensation expense 2,019 1,613 4,215 2,919 Plus: Acquisition-related costs 5 6 10 13 Plus: Amortization of acquired intangibles 2,605 2,606 5,210 5,212 Non-GAAP gross profit $ 70,350 $ 56,788 $ 136,555 $ 110,540 GAAP gross margin 78.1 % 77.5 % 77.5 % 77.9 % Non-GAAP gross margin 83.6 % 83.7 % 83.3 % 84.1 % Reconciliation of operating expenses GAAP research and development $ 33,544 $ 28,945 $ 68,430 $ 56,046 Less: Share-based compensation expense (7,798 ) (5,330 ) (14,970 ) (10,462 ) Less: Acquisition-related costs (2,745 ) (2,149 ) (5,680 ) (4,524 ) Non-GAAP research and development $ 23,001 $ 21,466 $ 47,780 $ 41,060 GAAP sales and marketing $ 36,352 $ 31,991 $ 71,838 $ 61,171 Less: Share-based compensation expense (6,740 ) (4,792 ) (13,213 ) (9,547 ) Less: Acquisition-related costs — (112 ) (70 ) (236 ) Less: Amortization of acquired intangibles (358 ) (236 ) (716 ) (472 ) Non-GAAP sales and marketing $ 29,254 $ 26,851 $ 57,839 $ 50,916 GAAP general and administrative $ 14,732 $ 14,037 $ 28,972 $ 26,728 Less: Share-based compensation expense (4,765 ) (3,342 ) (8,836 ) (6,223 ) Less: Acquisition-related costs (64 ) (68 ) (140 ) (234 ) Less: Legal settlement costs — (122 ) — (216 ) Non-GAAP general and administrative $ 9,903 $ 10,505 $ 19,996 $ 20,055 Reconciliation of operating income (loss) and operating margin GAAP operating loss $ (18,907 ) $ (22,410 ) $ (42,120 ) $ (41,549 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Non-GAAP operating income (loss) $ 8,192 $ (2,034 ) $ 10,940 $ (1,491 ) GAAP operating margin (22.5 )% (33.0 )% (25.7 )% (31.6 )% Non-GAAP operating margin 9.7 % (3.0 )% 6.7 % (1.1 )% Reconciliation of net income (loss) GAAP net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Less: Income tax effects 460 1,201 1,238 1,381 Non-GAAP net income (loss) $ 12,092 $ (2,196 ) $ 18,022 $ (2,038 ) Net income (loss) per share - basic $ 0.12 $ (0.02 ) $ 0.18 $ (0.02 ) Net income (loss) per share - diluted $ 0.11 $ (0.02 ) $ 0.17 $ (0.02 ) Shares used in non-GAAP net income (loss) per share calculations: GAAP weighted-average shares used to compute net loss per share - basic and diluted 102,513 98,956 101,890 98,423 Add: Dilutive ordinary share equivalents(1) 5,580 — 5,589 — Non-GAAP weighted-average shares used to compute net income (loss) per share - diluted 108,093 98,956 107,479 98,423 (1) Potentially dilutive shares are excluded in calculating the non-GAAP diluted shares for the three and six months ended June 30, 2022 as the inclusion of such shares would have been anti-dilutive due to net loss in these periods. JFROG LTD. RECONCILIATION OF GAAP CASH FLOW FROM OPERATING ACTIVITIES TO FREE CASH FLOW (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net cash provided by operating activities $ 16,710 $ 3,952 $ 15,581 $ 8,983 Less: purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Free cash flow $ 16,203 $ 2,964 $ 14,808 $ 6,852 View source version on businesswire.com: https://www.businesswire.com/news/home/20230802058323/en/Contacts Investor Contact: Jeff Schreiner jeffs@jfrog.com
Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform
In the last bullet point of "Fiscal Year 2023 Outlook," the "Non-GAAP net income per diluted share" should be: between $0.31 and $0.33 (instead of between $0.26 and $0.28). The updated release reads: JFROG ANNOUNCES SECOND QUARTER FISCAL 2023 RESULTS Total Revenues of $84.2 million; up 24% Year-over-Year Cloud Revenues Up 44% Year-over-Year; driven by higher customer usage Launched JFrog Curation security tool to prevent malicious packages from entering software supply chains Commissioned Forrester study finds nearly 400% ROI with the JFrog Platform JFrog Ltd. (“JFrog”) (Nasdaq: FROG), the Liquid Software company and creators of the JFrog Software Supply Chain Platform, today announced financial results for its second quarter ended June 30, 2023. "The growth in our second-quarter revenue - alongside robust operating performance - demonstrates solid execution aligned with our plans. The continuous adoption of our DevOps and Security solutions as crucial enterprise infrastructure has been a driving force behind these results," stated Shlomi Ben Haim, JFrog CEO and Co-founder. "With the recent launch of JFrog Curation, natively integrated with JFrog Artifactory, Xray and Advanced Security, we have significantly enhanced our DevSecOps capabilities and are enthusiastic about further expansion of JFrog's presence in the security market." Second Quarter 2023 Financial Highlights Revenue for the second quarter of 2023 equaled $84.2 million, up 24% year-over-year. GAAP Gross Profit was $65.7 million; GAAP Gross Margin was 78.1%. Non-GAAP Gross Profit was $70.4 million; Non-GAAP Gross Margin was 83.6%. GAAP Operating Loss was ($18.9) million; GAAP Operating Margin was (22.5%). Non-GAAP Operating Income was $8.2 million; Non-GAAP Operating Margin was 9.7%. GAAP Net Loss Per Share was ($0.15); Non-GAAP Earnings Per Share was $0.11. Operating Cash Flow was $16.7 million; Free Cash Flow of $16.2 million. Cash, Cash Equivalents and Investments were $469.8 million as of June 30, 2023. Remaining performance obligations were $213.6 million as of June 30, 2023. Recent Business & Product Highlights Cloud revenue equaled $27.6 million during the second quarter of 2023, an increase of 44% year-over-year. Cloud revenue represented 33% of total revenue, compared to 28% in the year ago period. Net Dollar Retention rate for the trailing four quarters was 120%. $100K ARR customers increased to 813 customers, compared with 647 in the year ago period. $1 million ARR customers increased to 24 customers, up from 17 customers in the year ago period. Customers adopting the end-to-end JFrog Platform Enterprise+ subscription represented 45% of total revenue versus 36% in the year-ago period. Announced General Availability of JFrog Curation to prevent unwanted or malicious packages from entering an organization, protecting the software supply chain. Delivered JFrog-commissioned study from Forrester Consulting, showcasing nearly 400% ROI on JFrog Platform investments over 36 months. Third Quarter and Fiscal Year 2023 Outlook Third Quarter 2023 Outlook: Revenue between $87.0 million and $88.0 million Non-GAAP operating income between $6.0 million and $7.0 million Non-GAAP net income per diluted share between $0.08 and $0.09, assuming approximately 110 million weighted average diluted shares outstanding Fiscal Year 2023 Outlook: Revenue between $343.5 million to $345.5 million Non-GAAP operating income between $24.0 million and $25.0 million Non-GAAP net income per diluted share between $0.31 and $0.33, assuming approximately 110 million weighted average diluted shares outstanding The section titled "Non-GAAP Financial Information" below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data. Conference Call Details Event: JFrog’s Second Quarter Fiscal 2023 Financial Results Conference Call Date: Wednesday, August 2, 2023 Time: 2:00 p.m. PT (5:00 p.m. ET) A live webcast of the conference call will be accessible from the investor relations website at https://investors.jfrog.com/events-and-presentations. About JFrog JFrog Ltd. (Nasdaq: FROG), is on a mission to power all the world’s software updates, driven by a “Liquid Software” vision to allow the seamless, secure, fearless flow of binaries from developers to the edge. The JFrog Software Supply Chain Platform enables software creators to power their entire software supply chain throughout the full binary lifecycle, so they can build, secure, distribute, and connect any source with any production environment. JFrog’s hybrid, universal, multi-cloud platform is available as both self-hosted and SaaS services across major cloud service providers. Millions of users and thousands of customers worldwide, including a majority of the Fortune 100, depend on JFrog solutions to securely embrace digital transformation. Once you leap forward, you won’t go back! Learn more at jfrog.com and follow us on Twitter: @JFrog. Forward-Looking Statements: This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the U.S. federal securities laws, including but not limited to statements regarding JFrog’s future financial performance, including our outlook for the third quarter and for the full year of 2023, expectations regarding the market and revenue potential for JFrog Artifactory, JFrog Xray, JFrog Distribution, JFrog Connect and JFrog Curation , including the efficacy and benefit of integrating of any of the foregoing with other products and platform, our expectations regarding the mission-critical nature of the “JFrog Software Supply Chain Platform” to our customers’ infrastructure, the growth potential of our cloud business, including hybrid and multi-cloud, our ability to provide effective tools and solutions to detect and remediate security vulnerabilities, the ability of our strategic sales team to grow the business across top-tier accounts, our ability to expand usage of our platform in the government and commercial sectors, our ability to successfully integrate acquisitions into our business operations, including the JFrog Platform, and realize anticipated benefits and synergies from such acquisitions, our ability to contribute data to global security standards bodies, and our ability to innovate and meet market demands and the software supply chain needs of our customers. These forward-looking statements are based on JFrog’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause JFrog’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release and our earnings call, including but not limited to: risks associated with managing our rapid growth; our history of losses; our limited operating history; our ability to retain and upgrade existing customers our ability to attract new customers; our ability to effectively develop and expand our sales and marketing capabilities; our ability to integrate and realize anticipated synergies from acquisitions of complementary businesses; risk of a security breach incident or product vulnerability; risk of interruptions or performance problems associated with our products and platform capabilities; our ability to adapt and respond to rapidly changing technology or customer needs; our ability to compete in the markets in which we participate; our ability to successfully integrate technology from acquisitions, into our offerings; our ability to provide continuity to our respective customers and realize innovation following our acquisitions,; general market, political, economic, and business conditions; and the duration and impact of the COVID-19 pandemic. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in our filings with the Securities and Exchange Commission, including in our annual report on Form 10-K for the year ended December 31, 2022, our quarterly reports on Form 10-Q, and other filings and reports that we may file from time to time with the Securities and Exchange Commission. Forward-looking statements represent our beliefs and assumptions only as of the date of this press release. We disclaim any obligation to update forward-looking statements. About Non-GAAP Financial Measures: JFrog discloses the following non-GAAP financial measures in this release and the earnings call referencing this press release: non-GAAP operating income (loss), non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per diluted share, non-GAAP net income (loss) per basic share, and free cash flow. JFrog uses each of these non-GAAP financial measures internally to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, for short- and long-term operating plans, and to evaluate JFrog’s financial performance. JFrog believes they are useful to investors, as a supplement to GAAP measures, in evaluating its operational performance, as further discussed below. JFrog’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on JFrog’s reported financial results. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release. 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, reconciling items that may be incurred in the future such as share-based compensation, the effect of which may be significant. JFrog defines non-GAAP gross profit, non-GAAP operating expenses (research and development, sales and marketing, general and administrative), non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating income (loss) and non-GAAP net income (loss) as the respective GAAP balances, adjusted for, as applicable: (1) share-based compensation expense; (2) the amortization of acquired intangibles; (3) acquisition-related costs; (4) legal settlement costs and (5) income tax effects. JFrog defines free cash flow as Net cash provided by (used in) operating activities, minus capital expenditures. Investors are encouraged to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures. Management believes these non-GAAP financial measures are useful to investors and others in assessing JFrog’s operating performance due to the following factors: Share-based compensation. JFrog utilizes share-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of its shareholders and at long-term retention, rather than to address operational performance for any particular period. As a result, share-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period. Amortization of acquired intangibles. JFrog views amortization of acquired intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of acquired intangibles is an expense that is not typically affected by operations during any particular period. Acquisition-related costs. Acquisition-related costs include expenses related to acquisitions of other companies. JFrog views acquisition-related costs as expenses that are not necessarily reflective of operational performance during a period. Legal settlement costs. From time-to-time JFrog incurs charges related to litigation settlements. We exclude these charges and related professional service costs when associated with a significant settlement because they are not reflective of JFrog’s ongoing business and operating results. Income tax effects. JFrog’s non-GAAP financial results are adjusted for income tax effects related to these non-GAAP adjustments and changes in our assessment regarding the realizability of our deferred tax assets, if any. Excluding income tax effects of non-GAAP adjustments provides a more accurate view of JFrog’s operating results. Non-GAAP weighted average share count. Diluted GAAP and non-GAAP weighted-average shares are the same, except in periods that there is a GAAP loss and a non-GAAP income. The non-GAAP weighted-average shares used to compute the non-GAAP net income per share - diluted are adjusted to reflect dilution equal to the dilutive impact had there been GAAP income. Additionally, JFrog’s management believes that the non-GAAP financial measure, free cash flow, is meaningful to investors because management reviews cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered to be a necessary component of ongoing operations. Operating Metrics JFrog’s number of customers with annual recurring revenue (“ARR”) of $100,000 or more is based on the ARR of each customer, as of the last month of the quarter. JFrog’s number of customers with ARR of $1 million or more is based on the ARR of each customer, as of the last month of the quarter. JFrog defines ARR as the annualized revenue run-rate of subscription agreements from all customers as of the last month of the quarter. The ARR includes monthly subscription customers, so long as JFrog generates revenue from these customers. JFrog annualizes its monthly subscriptions by taking the revenue it would contractually expect to receive from such customers in a given month and multiplying it by 12. JFrog’s net dollar retention rate compares its ARR from the same set of customers across comparable periods. JFrog calculates net dollar retention rate by first identifying customers (the “Base Customers”), which were customers in the last month of a particular quarter (the “Base Quarter”). JFrog then calculates the contracted ARR from these Base Customers in the last month of the same quarter of the subsequent year (the “Comparison Quarter”). This calculation captures upsells, contraction, and attrition since the Base Quarter. JFrog then divides total Comparison Quarter ARR by total Base Quarter ARR for Base Customers. JFrog’s net dollar retention rate in a particular quarter is obtained by averaging the result from that particular quarter with the corresponding results from each of the prior three quarters. JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Revenue: Subscription—self-managed and SaaS $ 79,467 $ 63,679 $ 154,010 $ 122,748 License—self-managed 4,703 4,128 9,980 8,755 Total subscription revenue 84,170 67,807 163,990 131,503 Cost of revenue: Subscription—self-managed and SaaS(1)(2)(3) 18,231 15,024 36,434 28,667 License—self-managed(3) 218 220 436 440 Total cost of revenue—subscription 18,449 15,244 36,870 29,107 Gross profit 65,721 52,563 127,120 102,396 Operating expenses: Research and development(1)(2) 33,544 28,945 68,430 56,046 Sales and marketing(1)(2)(3) 36,352 31,991 71,838 61,171 General and administrative(1)(2)(4) 14,732 14,037 28,972 26,728 Total operating expenses 84,628 74,973 169,240 143,945 Operating loss (18,907 ) (22,410 ) (42,120 ) (41,549 ) Interest and other income, net 4,896 517 8,888 790 Loss before income taxes (14,011 ) (21,893 ) (33,232 ) (40,759 ) Income tax expense 1,456 1,880 3,044 2,718 Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Net loss per share, basic and diluted $ (0.15 ) $ (0.24 ) $ (0.36 ) $ (0.44 ) Weighted-average shares used in computing net loss per share, basic and diluted 102,513 98,956 101,890 98,423 (1) Includes share-based compensation expense as follows: Cost of revenue: subscription—self-managed and SaaS $ 2,019 $ 1,613 $ 4,215 $ 2,919 Research and development 7,798 5,330 14,970 10,462 Sales and marketing 6,740 4,792 13,213 9,547 General and administrative 4,765 3,342 8,836 6,223 Total share-based compensation expense $ 21,322 $ 15,077 $ 41,234 $ 29,151 (2) Includes acquisition-related costs as follows: Cost of revenue: subscription–self-managed and SaaS $ 5 $ 6 $ 10 $ 13 Research and development 2,745 2,149 5,680 4,524 Sales and marketing — 112 70 236 General and administrative 64 68 140 234 Total acquisition-related costs $ 2,814 $ 2,335 $ 5,900 $ 5,007 (3) Includes amortization of acquired intangibles as follows: Cost of revenue: subscription–self-managed and SaaS $ 2,387 $ 2,386 $ 4,774 $ 4,772 Cost of revenue: license—self-managed 218 220 436 440 Sales and marketing 358 236 716 472 Total amortization expense of acquired intangible assets $ 2,963 $ 2,842 $ 5,926 $ 5,684 (4) Includes legal settlement costs as follows: General and administrative $ — $ 122 $ — $ 216 JFROG LTD. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands; unaudited) June 30, 2023 December 31, 2022 Assets Current assets: Cash and cash equivalents $ 46,694 $ 45,595 Short-term investments 423,100 397,605 Accounts receivable, net 62,498 62,117 Deferred contract acquisition costs 9,063 8,102 Prepaid expenses and other current assets 16,955 18,603 Total current assets 558,310 532,022 Property and equipment, net 7,028 8,021 Deferred contract acquisition costs, noncurrent 14,134 13,501 Operating lease right-of-use assets 27,361 24,602 Intangible assets, net 31,618 37,544 Goodwill 247,955 247,955 Other assets, noncurrent 8,715 7,576 Total assets $ 895,121 $ 871,221 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ 13,097 $ 14,867 Accrued expenses and other current liabilities 31,724 28,848 Operating lease liabilities 8,272 7,132 Deferred revenue 170,967 158,725 Total current liabilities 224,060 209,572 Deferred revenue, noncurrent 13,441 16,990 Operating lease liabilities, noncurrent 18,241 16,829 Other liabilities, noncurrent 3,487 3,057 Total liabilities 259,229 246,448 Shareholders’ equity: Share capital 290 283 Additional paid-in capital 904,531 856,438 Accumulated other comprehensive loss (3,477 ) (2,772 ) Accumulated deficit (265,452 ) (229,176 ) Total shareholders’ equity 635,892 624,773 Total liabilities and shareholders’ equity $ 895,121 $ 871,221 JFROG LTD. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Cash flows from operating activities: Net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 3,828 3,572 7,675 7,091 Share-based compensation expense 21,322 15,077 41,234 29,151 Non-cash operating lease expense 2,123 1,796 4,145 3,602 Net amortization of premium or discount on investments (1,582 ) 760 (2,870 ) 2,388 Gain on foreign exchange (224 ) — (591 ) — Changes in operating assets and liabilities: Accounts receivable 617 (3,615 ) (221 ) (2,521 ) Prepaid expenses and other assets 1,153 5,025 (1,961 ) 4,136 Deferred contract acquisition costs (801 ) (1,549 ) (1,594 ) (3,606 ) Accounts payable (827 ) 1,267 (1,913 ) 2,227 Accrued expenses and other liabilities 2,620 3,933 3,030 5,457 Operating lease liabilities (2,033 ) (3,225 ) (3,770 ) (5,426 ) Deferred revenue 5,981 4,684 8,693 9,961 Net cash provided by operating activities 16,710 3,952 15,581 8,983 Cash flows from investing activities: Purchases of short-term investments (81,356 ) (89,068 ) (204,572 ) (181,279 ) Maturities and sales of short-term investments 68,845 81,232 183,171 155,869 Purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Payments related to business combinations — — — (179 ) Net cash used in investing activities (13,018 ) (8,824 ) (22,174 ) (27,720 ) Cash flows from financing activities: Proceeds from exercise of share options 2,211 1,078 3,367 2,873 Proceeds from employee share purchase plan — — 3,499 3,253 Proceeds from employee equity transactions, net of payments to tax authorities 520 (602 ) 817 (495 ) Net cash provided by financing activities 2,731 476 7,683 5,631 Effect of exchange rate changes on cash, cash equivalents and restricted cash (75 ) — 9 — Net increase (decrease) in cash, cash equivalents, and restricted cash 6,348 (4,396 ) 1,099 (13,106 ) Cash, cash equivalents, and restricted cash—beginning of period 40,358 59,830 45,607 68,540 Cash, cash equivalents, and restricted cash—end of period $ 46,706 $ 55,434 $ 46,706 $ 55,434 Reconciliation of cash, cash equivalents, and restricted cash within the Condensed Consolidated Balance Sheets to the amounts shown in the Condensed Consolidated Statements of Cash Flows above: Cash and cash equivalents $ 46,694 $ 55,194 $ 46,694 $ 55,194 Restricted cash included in prepaid expenses and other current assets 12 13 12 13 Restricted cash included in other assets, noncurrent — 227 — 227 Total cash, cash equivalents, and restricted cash $ 46,706 $ 55,434 $ 46,706 $ 55,434 JFROG LTD. RECONCILIATION OF GAAP TO NON-GAAP RESULTS (in thousands except per share data; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Reconciliation of gross profit and gross margin GAAP gross profit $ 65,721 $ 52,563 $ 127,120 $ 102,396 Plus: Share-based compensation expense 2,019 1,613 4,215 2,919 Plus: Acquisition-related costs 5 6 10 13 Plus: Amortization of acquired intangibles 2,605 2,606 5,210 5,212 Non-GAAP gross profit $ 70,350 $ 56,788 $ 136,555 $ 110,540 GAAP gross margin 78.1 % 77.5 % 77.5 % 77.9 % Non-GAAP gross margin 83.6 % 83.7 % 83.3 % 84.1 % Reconciliation of operating expenses GAAP research and development $ 33,544 $ 28,945 $ 68,430 $ 56,046 Less: Share-based compensation expense (7,798 ) (5,330 ) (14,970 ) (10,462 ) Less: Acquisition-related costs (2,745 ) (2,149 ) (5,680 ) (4,524 ) Non-GAAP research and development $ 23,001 $ 21,466 $ 47,780 $ 41,060 GAAP sales and marketing $ 36,352 $ 31,991 $ 71,838 $ 61,171 Less: Share-based compensation expense (6,740 ) (4,792 ) (13,213 ) (9,547 ) Less: Acquisition-related costs — (112 ) (70 ) (236 ) Less: Amortization of acquired intangibles (358 ) (236 ) (716 ) (472 ) Non-GAAP sales and marketing $ 29,254 $ 26,851 $ 57,839 $ 50,916 GAAP general and administrative $ 14,732 $ 14,037 $ 28,972 $ 26,728 Less: Share-based compensation expense (4,765 ) (3,342 ) (8,836 ) (6,223 ) Less: Acquisition-related costs (64 ) (68 ) (140 ) (234 ) Less: Legal settlement costs — (122 ) — (216 ) Non-GAAP general and administrative $ 9,903 $ 10,505 $ 19,996 $ 20,055 Reconciliation of operating income (loss) and operating margin GAAP operating loss $ (18,907 ) $ (22,410 ) $ (42,120 ) $ (41,549 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Non-GAAP operating income (loss) $ 8,192 $ (2,034 ) $ 10,940 $ (1,491 ) GAAP operating margin (22.5 )% (33.0 )% (25.7 )% (31.6 )% Non-GAAP operating margin 9.7 % (3.0 )% 6.7 % (1.1 )% Reconciliation of net income (loss) GAAP net loss $ (15,467 ) $ (23,773 ) $ (36,276 ) $ (43,477 ) Plus: Share-based compensation expense 21,322 15,077 41,234 29,151 Plus: Acquisition-related costs 2,814 2,335 5,900 5,007 Plus: Amortization of acquired intangibles 2,963 2,842 5,926 5,684 Plus: Legal settlement costs — 122 — 216 Less: Income tax effects 460 1,201 1,238 1,381 Non-GAAP net income (loss) $ 12,092 $ (2,196 ) $ 18,022 $ (2,038 ) Net income (loss) per share - basic $ 0.12 $ (0.02 ) $ 0.18 $ (0.02 ) Net income (loss) per share - diluted $ 0.11 $ (0.02 ) $ 0.17 $ (0.02 ) Shares used in non-GAAP net income (loss) per share calculations: GAAP weighted-average shares used to compute net loss per share - basic and diluted 102,513 98,956 101,890 98,423 Add: Dilutive ordinary share equivalents(1) 5,580 — 5,589 — Non-GAAP weighted-average shares used to compute net income (loss) per share - diluted 108,093 98,956 107,479 98,423 (1) Potentially dilutive shares are excluded in calculating the non-GAAP diluted shares for the three and six months ended June 30, 2022 as the inclusion of such shares would have been anti-dilutive due to net loss in these periods. JFROG LTD. RECONCILIATION OF GAAP CASH FLOW FROM OPERATING ACTIVITIES TO FREE CASH FLOW (in thousands; unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net cash provided by operating activities $ 16,710 $ 3,952 $ 15,581 $ 8,983 Less: purchases of property and equipment (507 ) (988 ) (773 ) (2,131 ) Free cash flow $ 16,203 $ 2,964 $ 14,808 $ 6,852 View source version on businesswire.com: https://www.businesswire.com/news/home/20230802058323/en/
