SolarWinds, Inc. (NYSE:SWI) Q4 2018 Earnings Conference Call Transcript

Feb 07, 2019 • 05:00 pm ET

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SolarWinds, Inc. (NYSE:SWI) Q4 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good afternoon. My name is Shontelle, and I will be your conference operator today. At this time, I would like to welcome everyone to the SolarWinds Fourth Quarter 2018 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer sesssion.

(Operator Instructions)

Dave Hafner, Head of Investor Relations, you may begin your conference.

Executive
David Hafner

Thank you, Chantelle. Good afternoon, everyone, and welcome to SolarWinds' fourth quarter 2018 earnings call. With me today are Kevin Thompson, our President and CEO; and Bart Kalsu, our Executive Vice President and CFO. Following prepared remarks from Kevin and Bart, we'll have a brief question-and-answer session. Please note that this call is being simultaneously webcast on our Investor Relations website at investors.solarwinds.com.

Please remember that certain statements made during this call, including those concerning our financial outlook, our expectations regarding growth and profitability, our expectations regarding the impact of our adoption of the new revenue recognition standard ASC 606, our market opportunity to market share, areas of focus for our business and our product plans and releases are forward-looking statements. These statements are subject to a number of risks, uncertainties and assumptions described in our SEC filings, including the risk factors discussed in our final prospectus dated October 18, 2018, and filed with the SEC on October 22, 2018, and the Form 10-K that we anticipate filing on or before April 1, 2019. Should any of these risks or uncertainties materialize or should any of our assumptions prove to be incorrect, actual Company results could differ materially and adversely from those anticipated in these forward-looking statements. These statements are also based on currently available information, and we undertake no duty to update these information except as required by law. The cautionary statements regarding these forward-looking statements are further described in today's press release.

In addition, some of the numbers during this call will be presented on a non-GAAP basis. This includes references to non-GAAP revenue. Our use of non-GAAP revenue reflects our adjustment to GAAP revenue for the purchase accounting-related impact to revenue following our take private transaction in February 2016. This adjustment to GAAP revenue impacted our revenue through the fourth quarter of 2018. Our 2019 results will no longer be impacted by this adjustment. We will also provide our financial outlook for revenue growth rates on a constant currency basis to provide a framework for assessing how we expect our business to perform, excluding the effect of foreign currency fluctuations.

Our use in calculation of these non-GAAP financial measures are further explained in today's press release, and a full reconciliation between each non-GAAP measure and its corresponding GAAP measure is provided in the tables accompanying the press release. However, each non-GAAP item in our forward-looking financial outlook that we provide today has not been reconciled to the comparable GAAP outlook item because providing projections of changes in individual balance sheet and income statement amounts is not possible without unreasonable effort, and release