Tintri : Reports Fourth Quarter and Fiscal Year 2018 Financial Results

Tintri, Inc. (NASDAQ: TNTR), a leading enabler of enterprise cloud, today reported results for its fourth quarter and fiscal year 2018 which ended on January 31, 2018.

“We are pleased with financial results that exceeded our revenue and EPS outlook, indicating the company has improved visibility into customer purchasing dynamics. We have taken a number of important actions to strengthen our balance sheet, improve our operating model, and reduce our cash burn,” said Ken Klein, Chairman and CEO at Tintri. “We also expanded our differentiated product portfolio and increased our footprint with existing customers.”

Business and Financial Highlights

• Q4 revenue of $28.9 million, better than the company’s guidance.
• Q4 net loss per share: ($1.19) per share GAAP and ($0.72) per share non-GAAP, better than the company’s guidance.
• Ken Klein, Chairman and CEO, will transition from his CEO role after a successor is found.
• Implemented work force reduction and lowered facilities footprint, as part of a plan to reduce FY19 operating expense by more than $70 million.
• Strengthened balance sheet by drawing on a $25 million note facility with certain existing stockholders.
• Tom Cashman promoted to Executive Vice President, Worldwide Sales and Alliances.

CEO and Sales Management Change
The company announced that its Chairman and CEO, Ken Klein, will transition from his CEO role after a successor is found. Mr. Klein expects to continue to serve as CEO and as a Board member until the new CEO is appointed and an orderly transition has occurred. The Board of Directors has initiated a search for a successor to lead the company in its next stage of evolution and has established a search process and engaged an executive search firm.

“On behalf of the Board, I would like to thank Ken for his 4 years of leadership and many contributions to Tintri,” said Harvey Jones, Tintri Board member. “Ken transformed the company and expanded Tintri’s technology differentiation in the market. The Board of Directors is grateful to Ken for his continued involvement as we conduct a comprehensive search for the company’s next CEO.”

“We made progress on our financial initiatives this quarter, by reporting a strong Q4, reducing our operating expenses, and strengthening our balance sheet. I am proud of the transformation the company has made and I believe the company is on the right trajectory,” said Ken Klein, CEO and Chairman. “I am ready to transition leadership to the right successor to propel the company forward.”

Tintri also announced that Tom Cashman has been promoted to Executive Vice President, Worldwide Sales and Alliances. Mr. Cashman joined Tintri in 2015, and had served most recently as Senior Vice President, International Sales and Global Alliances. Prior to joining the company, Mr. Cashman served in senior sales leadership capacities with Informix, Tivoli Systems, IBM, and CA Technologies.

Promissory Notes Financing
On Mar 2, 2018, the company announced the issuance of Promissory Notes to certain existing stockholders for aggregate gross proceeds of $25 million.  The Promissory Notes will have an interest rate of 8.0% per annum and are scheduled to mature 18 months from the date of issuance.  

Work Force and Facilities Restructuring
The company has implemented a restructuring and reduction in force plan of approximately 20% of the company’s global workforce. On February 21, 2018, the company also announced an early termination of a facility lease. The restructuring, which consisted of a reduction in force and a termination of a facility lease, is part of an overall plan to optimize the company’s operating model.

The company expects to substantially complete the restructuring in its first quarter of fiscal year 2019, which ends on April 30, 2018. The company estimates it will incur approximately $4.8 million to $5.8 million of cash expenditures in connection with the restructuring, substantially all of which relate to severance costs and contract termination costs. Total restructuring expenses are estimated at $6.2 million to $7.2 million, substantially all of which related to severance costs, write-off of net leasehold costs, and contract termination costs. The company expects to recognize most of these charges in the first quarter of fiscal year 2019.

Fourth Quarter and Fiscal Year 2018 Financial Highlights
The following tables summarize our consolidated financial results for the fiscal quarters and years ended January 31, 2017, and January 31, 2018 (unaudited):

A reconciliation between GAAP and non-GAAP information is provided at the end of this release.

First Quarter Fiscal Year 2019 Financial Outlook
As we look ahead, we are providing the following outlook for the quarter ending April 30, 2018. These guidance numbers are based on the existing revenue standard (ASC 605). We expect:

• Revenue in the range of $20.0 to $21.0 million;
• Non-GAAP loss per share in the range of ($0.64) to ($0.68), using 32.6 million weighted-average shares outstanding.

If appropriate, we may update our outlook after we have completed assessing the impact of the new revenue standard (ASC 606), adopted and effective beginning February 1, 2018.

All forward-looking non-GAAP financial measures contained in this section titled “First Quarter Fiscal 2019 Financial Outlook” exclude stock-based compensation expense, payroll tax expense related to stock-based activities, legal fees related to securities lawsuits, and, as applicable, other special items. We have not reconciled guidance for non-GAAP loss per share to its most directly comparable GAAP measure because the items that have been excluded are uncertain and cannot be reasonably predicted. Accordingly, a reconciliation of the non-GAAP financial measure guidance to the corresponding GAAP measures is not available without unreasonable effort.

Conference Call and Webcast
Tintri is hosting a conference call for analysts and investors to discuss its fourth quarter and fiscal year 2018 results and outlook for its first quarter fiscal year 2019 at 1:30 p.m. Pacific Time today, March 5, 2018. Participants can listen in via webcast by visiting the Investor Relations section of Tintri’s website at ir.tintri.com . Please go to the website at least 15 minutes early to register, download, and install any necessary audio software. A replay of the webcast will be available for 7 days after the call. The conference call can also be accessed by dialing 1-844-379-5957 or +1-209-905-5964 and using the conference ID 7669576. Following the call, an audio replay will also be available by calling 1-855-859-2056 or +1-404-537-3406 and entering the conference ID 7669576. The audio replay will be available through 5:30 p.m. Pacific Time on March 12, 2018.

Forward-Looking Statements
This press release contains forward-looking statements, including but not limited to statements relating to our search for a new CEO; estimates of the magnitude of workforce reductions; cash expenditures that may be made by the company and non-cash charges that may be incurred by the company in connection with the restructuring plan, and the changes in our senior management team, and Mr. Klein’s continued service as interim Chief Executive Officer and a member of our Board; anticipated changes to the company’s operating model and cash flows; customer purchasing trends; estimated revenues and non-GAAP loss per share for future fiscal periods; planned reductions in operating expenses in FY2019; our competitive position and environment; sales trends; and product releases. These forward-looking statements are not historical facts, and instead are based on our current expectations, estimates, opinions, and beliefs. Consequently, you should not rely on these forward-looking statements. The accuracy of such forward-looking statements depends upon future events, and involves risks, uncertainties, and other factors beyond our control that may cause these statements to be inaccurate and cause our actual results, performance, or achievements to differ materially and adversely from those anticipated or implied by such statements, including, among others: our ability to hire a new CEO and the timing of such hiring; our ability to reduce operating expenses in future periods; our ability to comply with and/or modify terms of our outstanding debt; the impact of the new revenue standard (ASC 606) on our revenue for the quarter ending April 30, 2018 and future periods; our ability to attract and retain employees; the rapid evolution of the markets in which we compete; our ability to sustain or manage future growth effectively; factors that could result in the significant fluctuation of our future quarterly operating results, including, among other things, our revenue mix, the timing and magnitude of orders, shipments, and acceptance of our solutions in any given quarter, our ability to attract new and retain existing end-customers, changes in the pricing of certain components of our solutions, and fluctuations in demand and competitive pricing pressures for our solutions; the introduction or acceleration of adoption of competing solutions; failure to develop, or unexpected difficulties or delays in developing, new product features or technology on a timely or cost-effective basis; and other risks and uncertainties included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our reports on file with the U.S. Securities and Exchange Commission (“SEC”), which are available on our investor relations website at https://ir.tintri.com and on the SEC website at www.sec.gov , or that we may file with the SEC following the date of this press release, including our Quarterly Report on Form 10-Q for the quarter ended October 31, 2017. All statements provided in this release speak only as of the date of this press release and, except as required by law, we assume no obligation to update any forward-looking statements to reflect actual results or subsequent events or circumstances.

Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures and other key performance measures: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, pro forma non-GAAP net loss per share, free cash flow, and free cash flow as a percentage of revenue. In computing these non-GAAP financial measures, we exclude the effects of certain items such as stock-based compensation expense, restructuring charges, legal fees related to securities lawsuits and other one-off activities, IPO-related expenses not netted against IPO proceeds, deemed dividend to Series E and E-1 Convertible Preferred Stock, adjustment to Series E, E-1, and F Convertible Preferred Stock related to our IPO, and income tax-related impact. Free cash flow is a performance measure that our management believes provides useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures, and we define free cash flow as net cash used in operating activities less purchases of property and equipment. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures and key performance measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures and key performance measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses and expenditures such as stock-based compensation expense that may not be indicative of our ongoing core business operating results. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when analyzing historical performance and liquidity, and planning, forecasting, and analyzing future periods. However, these non-GAAP financial and key performance measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, pro forma non-GAAP net loss per share, and free cash flow are not substitutes for gross profit, gross margin, operating expenses, loss from operations, operating margin, net loss or net loss attributable to common stockholders, net loss per share or net loss per share attributable to common stockholders, net loss per share or net loss per share attributable to common stockholders, or net cash used in operating activities, respectively. In addition, other companies, including companies in our industry, may calculate non-GAAP financial measures and key performance measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures and key performance measures as tools for comparison. We urge you to review the reconciliation of our non-GAAP financial measures and key performance measures to the most directly comparable GAAP financial measures included below in the tables captioned “Reconciliation of GAAP to Non-GAAP Profit Measures,” and “Reconciliation of GAAP Net Cash Used In Operating Activities to Non-GAAP Free Cash Flow,” and not to rely on any single financial measure to evaluate our business.

About Tintri
Tintri (NASDAQ: TNTR) offers an enterprise cloud infrastructure built on a public cloud-like web services architecture and RESTful APIs. Organizations use Tintri all-flash storage with scale-out and automation as a foundation for their own clouds—to build agile development environments for cloud native applications and to run mission critical enterprise applications. Tintri enables users to guarantee the performance of their applications, automate common IT tasks to reduce operating expenses, troubleshoot across their infrastructure, and predict an organization’s needs to scale—the underpinnings of a modern data center. That’s why leading cloud service providers and enterprises, including Comcast, Chevron, NASA, Toyota, United Healthcare, and 20% of the Fortune 100 companies, trust Tintri with enterprise cloud. For more information, visit www.tintri.com and follow us on Twitter: @Tintri. Tintri has used, and intends to continue to use, its Investor Relations website and the Twitter account of @Tintri as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

© 2018 Tintri, Inc. All rights reserved. Tintri and the Tintri logo are registered trademarks or trademarks of Tintri, Inc. in the United States and other countries. Other brand names mentioned herein are for identification purposes only and may be trademarks of their respective holder(s).

TINTRI, INC.
Condensed Consolidated Balance Sheets
(in thousands, unaudited)

TINTRI, INC.
Condensed Consolidated Statements of Operations
(in thousands, except share and per share data, unaudited)

TINTRI, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands, unaudited)

Source: Tintri

View source version on businesswire.com: http://www.businesswire.com/news/home/20180305006161/en/