|
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CHECK POINT SOFTWARE TECHNOLOGIES LTD.
(Translation of registrant's name into English)
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5 Ha’solelim Street, Tel Aviv, Israel
(Address of principal executive offices)
|
Investors: Kip E. Meintzer
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Media: Gil Messing
|
Check Point Software Technologies |
Check Point Software Technologies |
+1.650.628.2040 |
+1.650.628.2260 |
ir@checkpoint.com |
press@checkpoint.com |
•
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Total Revenue: $509 million, 4 percent increase year over year
|
•
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Deferred Revenues: $1,302 million, 5 percent increase year over year
|
•
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GAAP Operating Income: $231 million, representing 45 percent of revenues
|
•
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Non-GAAP Operating Income: $265 million, representing 52 percent of revenues
|
•
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GAAP EPS: $1.42, a 14% increase year over year
|
•
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Non-GAAP EPS: $1.64, a 14% increase year over year
|
•
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Total Revenue: $509 million compared to $491 million in the third quarter of 2019, a 4 percent increase year over year.
|
•
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GAAP Operating Income: $231 million compared to $214 million in the third quarter of 2019, representing 45 percent and 44 percent of revenues in the third quarter of
2020 and 2019, respectively.
|
•
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Non-GAAP Operating Income: $265 million compared to $246 million in the third quarter of 2019, representing 52 percent and 50 percent of revenues in the third quarter of
2020 and 2019, respectively.
|
•
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GAAP Taxes on Income: $45 million compared to $47 million in the third quarter of 2019.
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•
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GAAP Net Income: GAAP net income was $201 million compared to $188 million in the third quarter of 2019.
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•
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Non-GAAP Net Income: Non-GAAP net income was $231 million compared to $217 million in the third quarter of 2019.
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•
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GAAP Earnings per Diluted share: $1.42 compared to $1.25 in the third quarter of 2019, a 14 percent increase year over year.
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•
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Non-GAAP Earnings per Diluted share: $1.64 compared to $1.44 in the third quarter of 2019, a 14 percent increase year over year.
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•
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Deferred Revenues: As of September 30, 2020, deferred revenues were $1,302 million compared to $1,242 million as of September 30, 2019, a 5 percent increase year over
year.
|
•
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Cash Balances, Marketable Securities & Short Term Deposits: $3,896 million as of September 30, 2020, compared to $4,055 million as of September 30, 2019. During this
twelve months ended September 30, 2020, we generated net cash of $1,141 million and repurchased shares in the amount of $1,300 million.
|
•
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Cash Flow: Cash flow from operations of $248 million compared to $244 million in the third quarter of 2019.
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•
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Share Repurchase Program: During the third quarter of 2020, the company repurchased approximately 2.7 million shares at a total cost of approximately $325 million.
|
•
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RBC 2020 Virtual Technology, Internet, Media & Telecommunications Conference
November 17-18, 2020 – Virtual 1x1’s |
•
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Credit Suisse 2020 Virtual Technology Summit
November 30 - December 1, 2020 – Virtual Fireside Chat & 1x1’s |
•
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Wells Fargo 2020 Virtual Technology Conference
December 2, 2020 – Virtual Fireside Chat & 1x1’s |
•
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NASDAQ 2020 Technology Conference
December 3-4, 2020 – Virtual Fireside Chat & 1x1’s |
•
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Raymond James 2020 Technology Conference
December 7, 2020 – Virtual 1x1’s |
•
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UBS 2020 Technology Conference
December 8-9, 2020 – Virtual 1x1’s |
•
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Barclays 2020 Technology Conference
December 10, 2020 – Virtual 1x1’s |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
Revenues:
|
||||||||||||||||
Products and licenses
|
$
|
120.2
|
$
|
118.3
|
$
|
353.0
|
$
|
352.9
|
||||||||
Security subscriptions
|
168.8
|
153.9
|
491.6
|
446.5
|
||||||||||||
Total revenues from products and security subscriptions
|
289.0
|
272.2
|
844.6
|
799.4
|
||||||||||||
Software updates and maintenance
|
220.0
|
218.7
|
656.5
|
651.4
|
||||||||||||
Total revenues
|
509.0
|
490.9
|
1,501.1
|
1,450.8
|
||||||||||||
Operating expenses:
|
||||||||||||||||
Cost of products and licenses
|
22.9
|
21.0
|
66.3
|
62.0
|
||||||||||||
Cost of security subscriptions
|
5.9
|
6.1
|
18.5
|
17.8
|
||||||||||||
Total cost of products and security subscriptions
|
28.8
|
27.1
|
84.8
|
79.8
|
||||||||||||
Cost of Software updates and maintenance
|
23.3
|
24.0
|
70.5
|
69.8
|
||||||||||||
Amortization of technology
|
1.7
|
1.4
|
4.9
|
4.2
|
||||||||||||
Total cost of revenues
|
53.8
|
52.5
|
160.2
|
153.8
|
||||||||||||
Research and development
|
61.3
|
60.1
|
185.9
|
176.6
|
||||||||||||
Selling and marketing
|
135.8
|
137.3
|
419.2
|
411.4
|
||||||||||||
General and administrative
|
26.8
|
27.2
|
83.0
|
76.6
|
||||||||||||
Total operating expenses
|
277.7
|
277.1
|
848.3
|
818.4
|
||||||||||||
Operating income
|
231.3
|
213.8
|
652.8
|
632.4
|
||||||||||||
Financial income, net
|
14.4
|
20.9
|
52.4
|
60.7
|
||||||||||||
Income before taxes on income
|
245.7
|
234.7
|
705.2
|
693.1
|
||||||||||||
Taxes on income
|
45.0
|
46.9
|
129.4
|
139.8
|
||||||||||||
Net income
|
$
|
200.7
|
$
|
187.8
|
$
|
575.8
|
$
|
553.3
|
||||||||
Basic earnings per share
|
$
|
1.44
|
$
|
1.26
|
$
|
4.06
|
$
|
3.64
|
||||||||
Number of shares used in computing basic earnings per share
|
139.3
|
149.4
|
141.8
|
151.9
|
||||||||||||
Diluted earnings per share
|
$
|
1.42
|
$
|
1.25
|
$
|
3.99
|
$
|
3.61
|
||||||||
Number of shares used in computing diluted earnings per share
|
141.1
|
150.8
|
144.4
|
153.4
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
Revenues
|
$
|
509.0
|
$
|
490.9
|
$
|
1,501.1
|
$
|
1,450.8
|
||||||||
Non-GAAP operating income
|
265.0
|
246.4
|
749.4
|
723.1
|
||||||||||||
Non-GAAP net income
|
230.8
|
216.7
|
661.7
|
633.7
|
||||||||||||
Diluted Non-GAAP Earnings per share
|
$
|
1.64
|
$
|
1.44
|
$
|
4.58
|
$
|
4.13
|
||||||||
Number of shares used in computing diluted Non-GAAP earnings per share
|
141.1
|
150.8
|
144.4
|
153.4
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
GAAP operating income
|
$
|
231.3
|
$
|
213.8
|
$
|
652.8
|
$
|
632.4
|
||||||||
Stock-based compensation (1)
|
29.1
|
29.3
|
83.5
|
80.1
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
4.6
|
3.3
|
13.1
|
10.6
|
||||||||||||
Non-GAAP operating income
|
$
|
265.0
|
$
|
246.4
|
$
|
749.4
|
$
|
723.1
|
||||||||
GAAP net income
|
$
|
200.7
|
$
|
187.8
|
$
|
575.8
|
$
|
553.3
|
||||||||
Stock-based compensation (1)
|
29.1
|
29.3
|
83.5
|
80.1
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
4.6
|
3.3
|
13.1
|
10.6
|
||||||||||||
Taxes on the above items (3)
|
(3.6
|
)
|
(3.7
|
)
|
(10.7
|
)
|
(10.3
|
)
|
||||||||
Non-GAAP net income
|
$
|
230.8
|
$
|
216.7
|
$
|
661.7
|
$
|
633.7
|
||||||||
Diluted GAAP Earnings per share
|
$
|
1.42
|
$
|
1.25
|
$
|
3.99
|
$
|
3.61
|
||||||||
Stock-based compensation (1)
|
0.21
|
0.19
|
0.58
|
0.52
|
||||||||||||
Amortization of intangible assets and acquisition related expenses (2)
|
0.03
|
0.02
|
0.09
|
0.07
|
||||||||||||
Taxes on the above items (3)
|
(0.02
|
)
|
(0.02
|
)
|
(0.08
|
)
|
(0.07
|
)
|
||||||||
Diluted Non-GAAP Earnings per share
|
$
|
1.64
|
$
|
1.44
|
$
|
4.58
|
$
|
4.13
|
||||||||
Number of shares used in computing diluted Non-GAAP earnings per share
|
141.1
|
150.8
|
144.4
|
153.4
|
||||||||||||
(1) Stock-based compensation:
|
||||||||||||||||
Cost of products and licenses
|
$
|
0.1
|
$
|
0.1
|
$
|
0.3
|
$
|
0.1
|
||||||||
Cost of software updates and maintenance
|
1.1
|
1.2
|
3.0
|
3.2
|
||||||||||||
Research and development
|
6.9
|
5.4
|
17.2
|
14.5
|
||||||||||||
Selling and marketing
|
10.2
|
7.8
|
26.8
|
20.8
|
||||||||||||
General and administrative
|
10.8
|
14.8
|
36.2
|
41.5
|
||||||||||||
29.1
|
29.3
|
83.5
|
80.1
|
|||||||||||||
(2) Amortization of intangible assets and acquisition related expenses:
|
||||||||||||||||
Amortization of technology-cost of revenues
|
1.7
|
1.4
|
4.9
|
4.2
|
||||||||||||
Research and development
|
1.1
|
1.5
|
2.8
|
5.0
|
||||||||||||
Selling and marketing
|
1.8
|
0.4
|
5.4
|
1.4
|
||||||||||||
4.6
|
3.3
|
13.1
|
10.6
|
|||||||||||||
(3) Taxes on the above items
|
(3.6
|
)
|
(3.7
|
)
|
(10.7
|
)
|
(10.3
|
)
|
||||||||
Total, net
|
$
|
30.1
|
$
|
28.9
|
$
|
85.9
|
$
|
80.4
|
September 30,
|
December 31,
|
|||||||
2020
|
2019
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
248.1
|
$
|
279.2
|
||||
Marketable securities and short-term deposits
|
1,358.9
|
1,300.1
|
||||||
Trade receivables, net
|
302.3
|
495.8
|
||||||
Prepaid expenses and other current assets
|
53.5
|
59.1
|
||||||
Total current assets
|
1,962.8
|
2,134.2
|
||||||
Long-term assets:
|
||||||||
Marketable securities
|
2,289.4
|
2,368.8
|
||||||
Property and equipment, net
|
90.7
|
87.7
|
||||||
Deferred tax asset, net
|
33.7
|
55.3
|
||||||
Goodwill and other intangible assets, net
|
1,042.8
|
1,024.7
|
||||||
Other assets
|
89.7
|
94.2
|
||||||
Total long-term assets
|
3,546.3
|
3,630.7
|
||||||
Total assets
|
$
|
5,509.1
|
$
|
5,764.9
|
Current liabilities:
|
||||||||
Deferred revenues
|
$
|
950.0
|
$
|
1,011.9
|
||||
Trade payables and other accrued liabilities
|
390.0
|
384.8
|
||||||
Total current liabilities
|
1,340.0
|
1,396.7
|
||||||
Long-term liabilities:
|
||||||||
Long-term deferred revenues
|
351.8
|
374.8
|
||||||
Income tax accrual
|
432.4
|
393.3
|
||||||
Other long-term liabilities
|
32.8
|
31.3
|
||||||
817.0
|
799.4
|
|||||||
Total liabilities
|
2,157.0
|
2,196.1
|
||||||
Shareholders’ equity:
|
||||||||
Share capital
|
0.8
|
0.8
|
||||||
Additional paid-in capital
|
1,897.0
|
1,770.3
|
||||||
Treasury shares at cost
|
(9,036.5
|
)
|
(8,092.7
|
)
|
||||
Accumulated other comprehensive gain
|
46.3
|
21.7
|
||||||
Retained earnings
|
10,444.5
|
9,868.7
|
||||||
Total shareholders’ equity
|
3,352.1
|
3,568.8
|
||||||
Total liabilities and shareholders’ equity
|
$
|
5,509.1
|
$
|
5,764.9
|
||||
Total cash and cash equivalents, marketable securities and short-term deposits
|
$
|
3,896.4
|
$
|
3,948.7
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2020
|
2019
|
2020
|
2019
|
|||||||||||||
Cash flow from operating activities:
|
||||||||||||||||
Net income
|
$
|
200.7
|
$
|
187.8
|
$
|
575.8
|
$
|
553.3
|
||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||||||
Depreciation of property and equipment
|
4.8
|
4.5
|
13.8
|
11.7
|
||||||||||||
Amortization of intangible assets
|
2.1
|
1.8
|
6.1
|
5.4
|
||||||||||||
Stock-based compensation
|
29.1
|
29.3
|
83.5
|
80.1
|
||||||||||||
Realized loss (gain) on marketable securities
|
(2.2
|
)
|
(0.3
|
)
|
(2.9
|
)
|
0.2
|
|||||||||
Decrease in trade and other receivables, net
|
34.2
|
45.3
|
210.3
|
219.8
|
||||||||||||
Decrease in deferred revenues, trade payables and other accrued liabilities
|
(22.9
|
)
|
(28.3
|
)
|
(39.9
|
)
|
(25.2
|
)
|
||||||||
Deferred income taxes, net
|
1.8
|
4.3
|
12.3
|
10.6
|
||||||||||||
Net cash provided by operating activities
|
247.6
|
244.4
|
859.0
|
855.9
|
||||||||||||
Cash flow from investing activities:
|
||||||||||||||||
Proceeds (payment) in conjunction with acquisitions, net of acquired cash
|
(23.1
|
)
|
0.4
|
(23.1
|
)
|
(5.1
|
)
|
|||||||||
Investment in property and equipment
|
(4.5
|
)
|
(5.5
|
)
|
(16.8
|
)
|
(20.2
|
)
|
||||||||
Net cash used in investing activities
|
(27.6
|
)
|
(5.1
|
)
|
(39.9
|
)
|
(25.3
|
)
|
||||||||
Cash flow from financing activities:
|
||||||||||||||||
Proceeds from issuance of shares upon exercise of options
|
47.4
|
21.9
|
74.0
|
84.9
|
||||||||||||
Purchase of treasury shares
|
(325.0
|
)
|
(323.0
|
)
|
(974.7
|
)
|
(952.9
|
)
|
||||||||
Payments related to shares withheld for taxes
|
(0.6
|
)
|
(0.4
|
)
|
(5.4
|
)
|
(5.5
|
)
|
||||||||
Net cash used in financing activities
|
(278.2
|
)
|
(301.5
|
)
|
(906.1
|
)
|
(873.5
|
)
|
||||||||
Unrealized gain (loss) on marketable securities, net
|
(4.8
|
)
|
7.7
|
34.7
|
58.9
|
|||||||||||
Increase (decrease) in cash and cash equivalents, marketable securities and short term deposits
|
(63.0
|
)
|
(54.5
|
)
|
(52.3
|
)
|
16.0
|
|||||||||
Cash and cash equivalents, marketable securities and short term deposits at the beginning of the period
|
3,959.4
|
4,109.6
|
3,948.7
|
4,039.1
|
||||||||||||
Cash and cash equivalents, marketable securities and short term deposits at the end of the period
|
$
|
3,896.4
|
$
|
4,055.1
|
$
|
3,896.4
|
$
|
4,055.1
|
|
CHECK POINT SOFTWARE TECHNOLOGIES LTD.
By: /s/ Tal Payne
Tal Payne
Chief Financial Officer & Chief Operating Officer
|