"For the fourth quarter and full year of 2012, our financial results continued to illustrate the strength of our team and the unique and disruptive nature of our business model," added Mike Berry, SolarWinds' Chief Financial Officer. "These factors once again enabled us to deliver a combination of strong revenue growth, non-GAAP operating margins, and record free cash flow amidst a period of significant investment in our business. These investments included extensive marketing to build awareness of our brands and products as well as several product releases based on both acquired and internally developed technologies that allowed us to go broader and deeper within the markets we serve. Overall, we are very pleased with our financial results for 2012, and given our disciplined approach to investing in our business and the large opportunity we see before us, we continue to be excited about our opportunity to generate solid growth while delivering strong profitability and free cash flow in 2013."
As of February 4, 2013, SolarWinds is providing its financial outlook for its first quarter and full year of 2013. The financial information below represents forward-looking non-GAAP financial information, including an estimate of non-GAAP operating income as a percentage of revenue, and non-GAAP diluted earnings per share, for the first quarter of 2013 and for the full year 2013. These non-GAAP financial measures exclude, among other items mentioned below, stock-based compensation expense and related employer-paid payroll taxes. SolarWinds cannot reasonably estimate the expected stock-based compensation expense and related employer-paid payroll taxes for these future periods as the amounts depend upon such factors as the future price of SolarWinds' stock for purposes of computation. In addition, costs related to non-recurring items and acquisitions are not something that SolarWinds can estimate because they are a function of what non-recurring items and acquisitions, if any, occur and the kind of costs incurred in connection with any such non-recurring items or acquisitions.
Financial Outlook for the First Quarter of 2013
SolarWinds' management currently expects to achieve the following results for the first quarter of 2013:
•Total revenue in the range of $74.9-$75.7 million, or 26% to 27% growth over the first quarter of 2012.
•Non-GAAP operating income representing 51%-51.5% of revenue.
•Non-GAAP diluted earnings per share of approximately $0.37.
•Weighted average outstanding diluted shares of approximately 77.2 million.
Financial Outlook for Full Year 2013
SolarWinds' management currently expects to achieve the following results for the full year 2013:
•Total 2013 revenue in the range of $330.0-$338.0 million, or 23% to 26% year-over-year growth.
•Non-GAAP operating income for the full year representing 51%-52% of revenue.
•Non-GAAP diluted earnings per share of $1.57-$1.62.
•Weighted average outstanding diluted shares of approximately 78.0 million.
Conference Call and Webcast
In conjunction with this announcement, SolarWinds will host a conference call today to discuss its financial results and other business at 4:00pm CT (5:00pm ET/2:00pm PT). A live webcast of the event, including any supplemental information, will be available on the SolarWinds Investor Relations website at http://ir.solarwinds.com. A live dial-in will be available domestically at 800-390-5311 and internationally at +1-719-325-2207. To access the live call, please dial in 5-10 minutes before the scheduled start time. A replay of the webcast will be available on a temporary basis shortly after the event on the SolarWinds Investor Relations website.
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