EX-99.2 3 exhibit_99-2.htm EXHIBIT 99.2

Exhibit 99.2
 
 
FOR IMMEDIATE RELEASE
 
RADCOM Reports Third Quarter 2017 Financial Results
 
 
●
Q3 Revenues up 25% Year-Over-Year to $9.6 million
 
●
Highest Quarterly Revenues in the Company's History
 
●
Cash and Cash Equivalents of $33.6 million and No Debt
 
TEL AVIV, Israel – November 6, 2017 − RADCOM Ltd. (NASDAQ: RDCM), today reported its financial results for the third quarter ended September 30, 2017.
 
"We are very pleased with our third quarter execution which resulted in record-high quarterly revenues driven by our work with AT&T and other top-tier operators" commented Mr. Yaron Ravkaie, RADCOM's CEO.  "During this quarter, we announced a new win with a world leading top-tier operator and are now executing on the deployment of this contract. Also, subsequent to the quarter, we signed a three-year contract extension with Globe Telecom – the leading operator in the Philippines, with over 60 million customers - to provide service assurance for their mobile network, and to ensure their future transformation to NFV (Network Functions Virtualization). Given the ongoing momentum we see in the market, we also executed during October a successful public equity offering that significantly strengthens our balance sheet and allows us to continue executing on the company's growth strategy. With our current visibility we are updating our 2017 revenue guidance to $36.6-$37.8 million."

Third Quarter 2017 Financial Highlights:

·
Revenues: Total revenues for the third quarter were $9.6 million, up 25% compared to $7.7 million in the third quarter of 2016.

·
Net Income: GAAP net income for the period was $1.2 million, or $0.10 per diluted share, compared to approximately breakeven for the third quarter of 2016.

·
Non-GAAP Net Income:  Non-GAAP net income for the period was $1.7 million, or $0.14 per diluted share, compared to non-GAAP net income of $1.0 million, or $0.09 per diluted share, for the third quarter of 2016.

Both GAAP and non-GAAP results for the third quarter of 2017 included a $155,000, or $0.01 per diluted share, benefit related to grants from the Israel Innovation Authority (formerly Office of the Chief Scientist) compared to $385,000, or $0.03 per diluted share, in the third quarter of 2016.
 
·
Balance sheet: As of September 30, 2017, the Company had cash and cash equivalents of $33.6 million and no debt.   Subsequent to the quarter, RADCOM closed an underwritten public offering of 1,661,536 ordinary shares which generated net proceeds of approximately $30.2 million.
 
Earnings Conference Call
 RADCOM's management will hold an interactive conference call today at 8:00 AM Eastern Time (15:00 Israel Time) to discuss the results and to answer participants' questions. To join the call, please call one of the following numbers approximately five minutes before the call is scheduled to begin:
 
From the US (toll-free): + 1-888-668-9141
 
From other locations: +972-3-918-0610
 
For those unable to listen to the call at the time, a replay will be available from November 7th on RADCOM's website.
 
 
For all investor enquiries, please contact:

 Ran Vered
CFO
+972-77-774-5011
ranv@radcom.com
 
For all media enquiries, please contact:

Mark Rolston
Marketing Manager
+972-77-774-5036
markr@radcom.com
 
About RADCOM
 
RADCOM (NASDAQ: RDCM) is a first-mover and leading provider of NFV-ready service assurance and customer experience management solutions for Communications Service Providers (CSPs). RADCOM's software - MaveriQ - continuously monitors network performance and quality of services, to optimize user experience for CSPs' subscribers. RADCOM specializes in solutions for next-generation mobile and fixed networks, including LTE, VoLTE, IMS and others. MaveriQ enables CSPs to smoothly migrate their networks to NFV by assuring physical, NFV-based and hybrid networks. For more information, please visit www.radcom.com.
 
Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the reader's overall understanding of the Company's financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, the Company's non-GAAP results provide information to both management and investors that is useful in assessing the Company's core operating performance and in evaluating and comparing the Company's results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with GAAP.
 
Risks Regarding Forward-Looking Statements
 
Certain statements made herein that use words such as "estimate," "project," "intend," "expect," "'believe", "may", "might", "predict", "potential", "anticipate", "plan" or similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. For example, when the Company discusses its revenue guidance for 2017 and expected new projects for the Company it is using foward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that could cause the actual results, performance or achievements of the Company to be materially different from those that may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in the demand for the Company's products, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on prices resulting from competition. For additional information regarding these and other risks and uncertainties associated with the Company's business, reference is made to the Company's reports filed from time to time with the U.S. Securities and Exchange Commission. The Company does not undertake to revise or update any forward-looking statements for any reason.
RADCOM Ltd.
Consolidated Statement of Operations
(thousands of U.S. dollars, except share and per share data)
 
   
Three months ended
 September 30,
    
Nine months ended
 September 30,
  
   
2017
    
2016
    
2017
    
2016
  
   
(unaudited)
    
(unaudited)
    
(unaudited)
    
(unaudited)
  
Revenues
  
$
9,645
    
$
7,726
    
$
26,602
    
$
21,473
  
Cost of revenues
    
3,163
      
2,357
      
7,828
      
6,186
  
Gross profit
    
6,482
      
5,369
      
18,774
      
15,287
  
Research and development, gross
    
2,280
      
1,985
      
7,507
      
5,453
  
Less - royalty-bearing participation
    
155
      
385
      
467
      
1,141
  
Research and development, net
    
2,125
      
1,600
      
7,040
      
4,312
  
Sales and marketing, net
    
2,333
      
2,352
      
8,219
      
5,611
  
General and administrative
    
991
      
1,436
      
3,149
      
3,463
  
Total operating expenses
    
5,449
      
5,388
      
18,408
      
13,386
  
Operating income (loss)
    
1,033
      
(19
)
    
366
      
1,901
  
Financial income, net
    
175
      
39
      
325
      
775
  
                                 
Income before taxes
    
1,208
      
20
      
691
      
2,676
  
Taxes
    
(25
)
    
(18
)
    
(48
)
    
(24
)
                                 
Net income
  
$
1,183
    
$
2
    
$
643
    
$
2,652
  
                                 
Basic net income per ordinary share
  
$
0.10
    
$
0.00
    
$
0.05
    
$
0.26
  
Diluted net income per ordinary share
  
$
0.10
    
$
0.00
    
$
0.05
    
$
0.26
  
Weighted average number of ordinary shares used in computing basic net income per ordinary share
    
11,747,443
      
11,410,105
      
11,698,246
      
10,023,733
  
Weighted average number of ordinary shares used in computing diluted net income   per ordinary share
    
12,070,080
      
11,708,030
      
12,018,658
      
10,396,446
  
 

RADCOM LTD.
Reconciliation of GAAP to Non-GAAP Financial Information
(thousands of U.S. dollars, except share and per share data)

   
Three months ended
September 30,
   
Nine months ended
September 30,
 
   
2017
    
2016
    
2017
    
2016
  
GAAP gross profit
  
$
6,482
    
$
5,369
    
$
18,774
    
$
15,287
  
Stock-based compensation
    
67
      
39
      
134
      
81
  
Non-GAAP gross profit
  
$
6,549
    
$
5,408
    
$
18,908
    
$
15,368
  
                                 
GAAP research and development, net
  
$
2,125
    
$
1,600
    
$
7,040
    
$
4,312
  
Stock-based compensation
    
97
      
155
      
339
      
394
  
Non-GAAP research and development, net
  
$
2,028
    
$
1,445
    
$
6,701
    
$
3,918
  
                                 
GAAP sales and marketing, net
  
$
2,333
    
$
2,352
    
$
8,219
    
$
5,611
  
Stock-based compensation
    
122
      
73
      
394
      
124
  
Non-GAAP sales and marketing, net
  
$
2,211
    
$
2,279
    
$
7,825
    
$
5,487
  
                                 
GAAP general and administrative
  
$
991
    
$
1,436
    
$
3,149
    
$
3,463
  
Stock-based compensation
    
200
      
746
      
859
      
1,101
  
Non-GAAP general and administrative
  
$
791
    
$
690
    
$
2,290
    
$
2,362
  
                                 
GAAP total operating expenses
  
$
5,449
    
$
5,388
    
$
18,408
    
$
13,386
  
Stock-based compensation
    
419
      
974
      
1,592
      
1,619
  
Non-GAAP total operating expenses
  
$
5,030
    
$
4,414
    
$
16,816
    
$
11,767
  
                                 
GAAP operating income (loss)
  
$
1,033
    
$
(19
)
  
$
366
    
$
1,901
  
Stock-based compensation
    
486
      
1,013
      
1,726
      
1,700
  
Non-GAAP operating income
  
$
1,519
    
$
994
    
$
2,092
    
$
3,601
  
                                 
GAAP income before taxes
  
$
1,208
    
$
20
    
$
691
    
$
2,676
  
Stock-based compensation
    
486
      
1,013
      
1,726
      
1,700
  
Non-GAAP income before taxes
  
$
1,694
    
$
1,033
    
$
2,417
    
$
4,376
  
                                 
GAAP net income
  
$
1,183
    
$
2
    
$
643
    
$
2,652
  
Stock-based compensation
    
486
      
1,013
      
1,726
      
1,700
  
Non-GAAP net income
  
$
1,669
    
$
1,015
    
$
2,369
    
$
4,352
  
                                 
GAAP Net income per diluted share
  
$
0.10
    
$
0.00
    
$
0.05
    
$
0.26
  
Stock-based compensation
    
0.04
      
0.09
      
0.15
      
0.16
  
Non-GAAP net income per diluted share
  
$
0.14
    
$
0.09
    
$
0.20
    
$
0.42
  
                                 
Weighted average number of shares used to compute diluted net income per share
    
12,070,080
      
11,708,030
      
12,018,658
      
10,396,446
  
 
RADCOM Ltd.
Consolidated Balance Sheets
(thousands of U.S. dollars)
 
   
As of
    
As of
  
   
September 30,
2017
    
December 31,
2016
  
   
(unaudited)
        
Current Assets
            
     Cash and cash equivalents
  
$
33,563
    
$
42,886
  
     Restricted bank deposits
    
35
      
32
  
     Trade receivables, net
    
13,835
      
4,388
  
     Inventories
    
275
      
623
  
     Other receivables
    
1,599
      
1,960
  
                 
   Total Current Assets
    
49,307
      
49,889
  
                 
Severance pay fund
    
3,065
      
2,788
  
                 
Other long-term receivables
    
335
      
375
  
                 
Property and equipment, net
    
1,855
      
1,516
  
                 
Total Assets
  
$
54,562
    
$
54,568
  
                 
Liabilities and Shareholders' Equity
                
Current Liabilities
                
       Trade payables
    
1,336
      
2,820
  
    Deferred revenue
    
583
      
2,593
  
       Employee and payroll accruals
    
3,691
      
3,541
  
    Other payables and accrued expenses
    
2,018
      
2,081
  
                 
   Total Current Liabilities
    
7,628
      
11,035
  
Long-Term Liabilities
                
    Deferred revenue
    
48
      
123
  
    Accrued severance pay
    
3,603
      
3,267
  
                 
   Total Long-Term Liabilities
    
3,651
      
3,390
  
                 
Total Liabilities
  
$
11,279
    
$
14,425
  
                 
Shareholders' Equity
                
     Share capital
    
531
      
523
  
     Additional paid-in capital
    
100,681
      
98,283
  
        Accumulated other comprehensive loss
    
(2,468
)
    
(2,559
)
     Accumulated deficit
    
(55,461
)
    
(56,104
)
                 
Total Shareholders' Equity
    
43,283
      
40,143
  
                 
   Total Liabilities and Shareholders' Equity
  
$
54,562
    
$
54,568