2018 Form 10-K Financial Statement

#000139297219000067 Filed on February 15, 2019

View on sec.gov

Income Statement

Concept 2018 2017 Q4 2017 Q3
Revenue $197.0M $46.34M $41.94M
YoY Change 16.71% 16.07% 9.26%
Cost Of Revenue $77.18M $18.15M $17.72M
YoY Change 12.56% 13.79% 13.31%
Gross Profit $119.8M $28.20M $24.21M
YoY Change 19.55% 17.61% 6.47%
Gross Profit Margin 60.83% 60.84% 57.74%
Selling, General & Admin $113.3M $27.31M $27.30M
YoY Change 4.48% 1.6% 19.26%
% of Gross Profit 94.55% 96.85% 112.77%
Research & Development $55.66M $13.59M $14.05M
YoY Change -0.65% 1.8% 8.35%
% of Gross Profit 46.44% 48.2% 58.01%
Depreciation & Amortization $13.06M $3.480M $3.040M
YoY Change 23.97% 64.93% 25.1%
% of Gross Profit 10.89% 12.34% 12.56%
Operating Expenses $169.0M $40.90M $41.35M
YoY Change 2.73% 1.67% 15.32%
Operating Profit -$49.22M -$12.82M -$17.75M
YoY Change -24.22% -21.18% 35.33%
Interest Expense -$17.10M -$4.140M -$4.090M
YoY Change 27.61% 73.95% 74.79%
% of Operating Profit
Other Income/Expense, Net $2.155M $70.00K $347.0K
YoY Change 461.2% -30.0% -1434.62%
Pretax Income -$64.05M -$16.89M -$21.50M
YoY Change -17.65% -8.85% 38.86%
Income Tax $200.0K -$31.27M -$271.0K
% Of Pretax Income
Net Earnings -$64.25M -$16.98M -$21.23M
YoY Change -17.56% -8.28% 35.13%
Net Earnings / Revenue -32.61% -36.64% -50.61%
Basic Earnings Per Share -$1.86 -$0.53 -$0.67
Diluted Earnings Per Share -$1.86 -$0.53 -$0.67
COMMON SHARES
Basic Shares Outstanding 34.47M shares 31.91M shares 31.87M shares
Diluted Shares Outstanding 34.47M shares 31.87M shares

Balance Sheet

Concept 2018 2017 Q4 2017 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $295.5M $160.5M $157.4M
YoY Change 84.11% 19.78% 7.66%
Cash & Equivalents $295.5M $160.5M $157.4M
Short-Term Investments $0.00 $0.00
Other Short-Term Assets $8.900M $9.100M $12.10M
YoY Change -2.2% 44.44% 80.6%
Inventory
Prepaid Expenses
Receivables $41.80M $33.24M $34.60M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $346.1M $202.1M $204.1M
YoY Change 71.25% 16.35% 13.84%
LONG-TERM ASSETS
Property, Plant & Equipment $14.70M $14.01M $14.47M
YoY Change 5.0% -8.08% -6.37%
Goodwill $38.46M $17.05M
YoY Change 91.37% -17.69%
Intangibles $26.93M $28.97M
YoY Change 112.88% 139.16%
Long-Term Investments
YoY Change
Other Assets $18.60M $4.039M $6.754M
YoY Change 158.33% -32.83% 101.07%
Total Long-Term Assets $90.90M $86.63M $88.51M
YoY Change 4.97% 60.43% 71.37%
TOTAL ASSETS
Total Short-Term Assets $346.1M $202.1M $204.1M
Total Long-Term Assets $90.90M $86.63M $88.51M
Total Assets $437.0M $288.7M $292.6M
YoY Change 51.37% 26.81% 26.7%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $6.900M $2.976M $4.203M
YoY Change 130.0% 8.45% 23.4%
Accrued Expenses $32.00M $6.733M $7.693M
YoY Change 36.75% -7.5% 46.95%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $136.5M
YoY Change
Total Short-Term Liabilities $274.8M $102.0M $98.30M
YoY Change 169.41% 5.48% 9.58%
LONG-TERM LIABILITIES
Long-Term Debt $88.70M $213.2M $210.3M
YoY Change -58.4% 74.33% 74.38%
Other Long-Term Liabilities $18.70M $843.0K $756.0K
YoY Change -8.33% 31.92% 10.04%
Total Long-Term Liabilities $107.4M $843.0K $756.0K
YoY Change -54.02% 31.92% 10.04%
TOTAL LIABILITIES
Total Short-Term Liabilities $274.8M $102.0M $98.30M
Total Long-Term Liabilities $107.4M $843.0K $756.0K
Total Liabilities $382.1M $335.7M $328.0M
YoY Change 13.82% 45.28% 48.45%
SHAREHOLDERS EQUITY
Retained Earnings -$238.2M -$221.2M
YoY Change 48.63% 56.06%
Common Stock $36.00K $36.00K
YoY Change 2.86% 2.86%
Preferred Stock
YoY Change
Treasury Stock (at cost) $13.94M $13.94M
YoY Change 0.0% 0.0%
Treasury Stock Shares 4.418M shares 4.418M shares
Shareholders Equity $54.90M -$46.98M -$35.41M
YoY Change
Total Liabilities & Shareholders Equity $437.0M $288.7M $292.6M
YoY Change 51.37% 26.81% 26.7%

Cashflow Statement

Concept 2018 2017 Q4 2017 Q3
OPERATING ACTIVITIES
Net Income -$64.25M -$16.98M -$21.23M
YoY Change -17.56% -8.28% 35.13%
Depreciation, Depletion And Amortization $13.06M $3.480M $3.040M
YoY Change 23.97% 64.93% 25.1%
Cash From Operating Activities $5.703M $4.540M -$8.540M
YoY Change -122.53% -163.14% -486.43%
INVESTING ACTIVITIES
Capital Expenditures $1.475M -$900.0K -$1.310M
YoY Change 14.7% -68.09% -22.02%
Acquisitions $0.00 $34.10M
YoY Change -100.0%
Other Investing Activities -$50.00K $0.00 -$28.12M
YoY Change -99.72% -100.0% 212.44%
Cash From Investing Activities -$6.258M -$910.0K -$29.42M
YoY Change -71.99% -103.02% 175.21%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $142.0M
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities $135.4M -510.0K -2.360M
YoY Change 49.31% -304.0% -553.85%
NET CHANGE
Cash From Operating Activities $5.703M 4.540M -8.540M
Cash From Investing Activities -$6.258M -910.0K -29.42M
Cash From Financing Activities $135.4M -510.0K -2.360M
Net Change In Cash $135.0M 3.120M -40.32M
YoY Change 213.92% -86.55% 406.53%
FREE CASH FLOW
Cash From Operating Activities $5.703M $4.540M -$8.540M
Capital Expenditures $1.475M -$900.0K -$1.310M
Free Cash Flow $4.228M $5.440M -$7.230M
YoY Change -115.9% -224.49% -285.86%

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250000000 USD
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250000000 USD
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3991000 USD
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5000000 USD
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24810000 USD
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4110000 USD
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1900000 USD
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174000 USD
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22519000 USD
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33266000 USD
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P2Y4M13D
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23442000 USD
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754000 USD
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6575000 USD
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1292000 USD
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1921000 USD
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3021000 USD
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5791000 USD
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700000 USD
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200000 USD
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19354000 USD
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17052000 USD
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17052000 USD
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1310000 USD
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252000 USD
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23520000 USD
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24320000 USD
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CY2017 us-gaap Gross Profit
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100250000 USD
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33155000 USD
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470000 USD
CY2017 us-gaap Income Tax Expense Benefit
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149000 USD
CY2018 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
200000 USD
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27490000 USD
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-504000 USD
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20417000 USD
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0 USD
CY2017 us-gaap Income Tax Reconciliation Change In Enacted Tax Rate
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31359000 USD
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1835000 USD
CY2018 us-gaap Income Tax Reconciliation Change In Enacted Tax Rate
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1800000 USD
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-25338000 USD
CY2017 us-gaap Income Tax Reconciliation Income Tax Expense Benefit At Federal Statutory Income Tax Rate
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-26443000 USD
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-13464000 USD
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457000 USD
CY2017 us-gaap Income Tax Reconciliation Nondeductible Expense
IncomeTaxReconciliationNondeductibleExpense
373000 USD
CY2018 us-gaap Income Tax Reconciliation Nondeductible Expense
IncomeTaxReconciliationNondeductibleExpense
414000 USD
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-4000 USD
CY2017 us-gaap Income Tax Reconciliation Nondeductible Expense Other
IncomeTaxReconciliationNondeductibleExpenseOther
245000 USD
CY2018 us-gaap Income Tax Reconciliation Nondeductible Expense Other
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0 USD
CY2016 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
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604000 USD
CY2017 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
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-3405000 USD
CY2018 us-gaap Income Tax Reconciliation Nondeductible Expense Share Based Compensation Cost
IncomeTaxReconciliationNondeductibleExpenseShareBasedCompensationCost
-394000 USD
CY2016 us-gaap Income Tax Reconciliation Other Adjustments
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0 USD
CY2017 us-gaap Income Tax Reconciliation Other Adjustments
IncomeTaxReconciliationOtherAdjustments
2625000 USD
CY2018 us-gaap Income Tax Reconciliation Other Adjustments
IncomeTaxReconciliationOtherAdjustments
-1824000 USD
CY2016 us-gaap Income Tax Reconciliation Other Reconciling Items
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49000 USD
CY2017 us-gaap Income Tax Reconciliation Other Reconciling Items
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0 USD
CY2018 us-gaap Income Tax Reconciliation Other Reconciling Items
IncomeTaxReconciliationOtherReconcilingItems
-153000 USD
CY2016 us-gaap Income Tax Reconciliation State And Local Income Taxes
IncomeTaxReconciliationStateAndLocalIncomeTaxes
3000 USD
CY2017 us-gaap Income Tax Reconciliation State And Local Income Taxes
IncomeTaxReconciliationStateAndLocalIncomeTaxes
18000 USD
CY2018 us-gaap Income Tax Reconciliation State And Local Income Taxes
IncomeTaxReconciliationStateAndLocalIncomeTaxes
46000 USD
CY2016 us-gaap Income Tax Reconciliation Tax Credits
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1663000 USD
CY2017 us-gaap Income Tax Reconciliation Tax Credits
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1711000 USD
CY2018 us-gaap Income Tax Reconciliation Tax Credits
IncomeTaxReconciliationTaxCredits
1656000 USD
CY2016 us-gaap Income Taxes Paid Net
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-968000 USD
CY2017 us-gaap Income Taxes Paid Net
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271000 USD
CY2018 us-gaap Income Taxes Paid Net
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262000 USD
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-2905000 USD
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700000 USD
CY2018 us-gaap Increase Decrease In Accounts Payable
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3931000 USD
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2801000 USD
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-1055000 USD
CY2018 us-gaap Increase Decrease In Accrued Liabilities
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2764000 USD
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14388000 USD
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14875000 USD
CY2018 us-gaap Increase Decrease In Deferred Revenue
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24652000 USD
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6000 USD
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45000 USD
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223000 USD
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54000 USD
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141500000 USD
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0 USD
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889000 USD
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6331000 USD
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1142000 USD
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1090000 USD
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1535000 USD
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174000 USD
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212000 USD
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223000 USD
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2503000 USD
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34
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0 USD
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185000 USD
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145000 USD
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2555000 USD
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3924000 USD
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192000 USD
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192000 USD
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183000 USD
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183000 USD
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0 USD
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9000 USD
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0 shares
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0 shares
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30395000 shares
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31627000 shares
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34465000 shares
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30395000 shares
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31627000 shares
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34465000 shares
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30395000 shares
CY2017 us-gaap Weighted Average Number Of Shares Outstanding Basic
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31627000 shares
CY2018 us-gaap Weighted Average Number Of Shares Outstanding Basic
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34465000 shares
CY2018 us-gaap Nature Of Operations
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Organization and Nature of Operations</font></div><div style="line-height:120%;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">PROS Holdings, Inc., a Delaware corporation, through its operating subsidiaries (collectively, the "Company"), provides artificial intelligence ("AI") solutions that power commerce in the digital economy by providing fast, frictionless and personalized buying experiences. PROS solutions enable dynamic buying experiences for both business-to-business ("B2B") and business-to-consumer ("B2C") companies across industry verticals. Companies can use the Company's dynamic pricing optimization, sales effectiveness, revenue management and commerce solutions to assess their market environments in real time to deliver customized prices and offers. The Company's solutions enable buyers to move fluidly across its customers&#8217; direct sales, online, mobile and partner channels with personalized experiences regardless of which channel those customers choose. The Company's decades of data science and AI expertise are infused into its solutions and are designed to reduce time and complexity through actionable intelligence. The Company provides standard configurations of its software based on the industries it serves and offers professional services to configure these solutions to meet the specific needs of each customer.</font></div></div>
CY2018 us-gaap Revenue Recognition Customer Acquisitions
RevenueRecognitionCustomerAcquisitions
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Deferred Costs</font></div><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Sales commissions earned by the Company's sales representatives are considered incremental and recoverable costs of obtaining a customer contract. Sales commissions are deferred and amortized on a straight-line basis over the period of benefit, which the Company has determined to be five to eight years. The Company determined the period of benefit by taking into consideration its customer contracts, expected renewals of those customer contracts (as the Company currently does not pay an incremental sales commission), the Company's technology and other factors. The Company also defers amounts earned by employees other than sales representatives who earn incentive payments under compensation plans that are also tied to the value of customer contracts acquired.</font></div></div>
CY2018 us-gaap Revenue Recognition Deferred Revenue
RevenueRecognitionDeferredRevenue
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Deferred Revenue</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Deferred revenue primarily consists of customer invoicing in advance of revenues being recognized. The Company generally invoices its customers annually in advance for subscription services and maintenance and support services. Deferred revenue that is anticipated to be recognized during the next twelve-month period is recorded as current deferred revenue and the remaining portion is recorded as noncurrent deferred revenue.</font></div></div>
CY2018 us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Use of Estimates</font></div><div style="line-height:120%;padding-top:4px;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of these Consolidated Financial Statements in conformity with GAAP requires the Company to make certain estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses during the reporting period. These estimates include, but are not limited to, unbilled receivables and deferred revenue, the determination of the period of benefit for deferred commissions, receivables, allowance for doubtful accounts, useful lives of assets, depreciation and amortization, the fair value of assets acquired and liabilities assumed for business combinations, income taxes and deferred tax asset valuation, valuation of stock options, other current liabilities and accrued liabilities. Actual results could differ from those estimates and such differences could be material to the Company's consolidated financial position and results of operations.</font></div><div style="line-height:120%;padding-top:4px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div>

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