RNG
$25.80
Ringcentral
$.15
.58%
Earnings Details
4th Quarter December 2016
Monday, February 13, 2017 4:05:01 PM
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Summary

Ringcentral Beats

Ringcentral (RNG) reported 4th Quarter December 2016 earnings of $0.03 per share on revenue of $104.5 million. The consensus earnings estimate was $0.02 per share on revenue of $103.0 million. The Earnings Whisper number was $0.01 per share. Revenue grew 25.2% on a year-over-year basis.

The company said in its earnings slides it expects first quarter non-GAAP earnings of $0.01 to $0.03 per share on revenue of $109.5 million to $111.5 million and 2017 earnings of $0.13 to $0.17 per share on revenue of $447.0 million to $454.0 million. The current consensus earnings estimate is of $0.02 per share on revenue of $106.8 million for the quarter ending March 31, 2017 and $0.15 per share on revenue of $466.7 million for the year ending December 31, 2017.

RingCentral Inc., provides software-as-a-service, or SaaS, solutions for business communications. Its solutions can be used in multiple devices including Smartphones, Tablets, PC’s and Desk Phones which allow communication across multiple channels.

Results
Reported Earnings
$0.03
Earnings Whisper
$0.01
Consensus Estimate
$0.02
Reported Revenue
$104.5 Mil
Revenue Estimate
$103.0 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

RingCentral Announces Fourth Quarter 2016 Results

RingCentral, Inc. (RNG), a leading provider of cloud business communications and collaboration solutions, today announced financial results for the fourth quarter and full year ended December 31, 2016.

Fourth Quarter Financial Highlights

Software subscriptions revenue grew 28% year-over-year to $98.0 million; total revenue was $104.5 million.

RingCentral Office(R) annualized exit recurring software subscriptions (ARR) grew 38% year-over-year to $341.5 million.

Total annualized exit recurring software subscriptions (ARR) grew 31% year-over-year to $414.4 million.

GAAP software subscriptions gross margin was 80.2%, up 2.2 points year-over-year, while Non-GAAP software subscriptions gross margin was 81.2%, up 2.5 points year-over-year.

GAAP operating margin was (6.3%), up 0.9 points year-over-year, while Non-GAAP operating margin was 2.1%, up 1.1 points year-over-year.

Net monthly subscriptions dollar retention: RingCentral Office(R) over 100% and overall subscriptions over 99%.

"The fourth quarter was a strong finish to a great year driven by our success with midmarket and enterprise customers. Our technology leadership and strategy of delivering integrated communications and collaboration solutions are paying off handsomely," said Vlad Shmunis, RingCentral’s Chairman and CEO. "Additionally, the reseller channels are now increasingly switching their focus to cloud solutions and it has enabled us to scale our midmarket and enterprise go-to-market efforts rapidly. These larger customer segments are now an over $100 million business, growing at over 90% year over year. With this momentum and the very large underpenetrated market, I feel confident that we will be a $1 billion revenue company by the end of 2020."

Financial Results for the Fourth Quarter 2016

Revenue: Total revenue was $104.5 million for the fourth quarter of 2016, up from $83.4 million in the fourth quarter of 2015. Software subscriptions revenue was $98.0 million for the fourth quarter of 2016, up from $76.5 million in the fourth quarter of 2015.

Pro Forma(1) Revenue Comparison: Total revenue of $104.5 million in the fourth quarter of 2016, up from $80.8 million in the fourth quarter of 2015, representing 29% growth, adjusting for the agency model on a comparable basis.

Net Income (Loss) Per Share: GAAP net loss per share was ($0.09) for the fourth quarter of 2016 compared with ($0.10) for the fourth quarter of 2015. Non-GAAP net income per diluted share was $0.03 for the fourth quarter of 2016, compared with $0.01 per diluted share for the fourth quarter of 2015.

Balance Sheet: Total cash and cash equivalents at the end of the fourth quarter of 2016 was $160.4 million, compared with $152.4 million at the end of the third quarter of 2016.

Financial Results for the Full Year 2016

Revenue: Total revenue was $379.7 million for the full year of 2016, up from $296.2 million in the full year of 2015. Software subscriptions revenue was $355.9 million for the full year of 2016, up from $271.2 million in the full year of 2015.

Pro Forma(1) Revenue Comparison: Total revenue of $378.3 million in the full year of 2016, up from $287.0 million in the full year of 2015, representing 32% growth, adjusting for the agency model on a comparable basis.

Net Income (Loss) Per Share: GAAP net loss per share was ($0.40) for the full year of 2016 compared with ($0.46) for the full year of 2015. Non-GAAP net income (loss) per diluted share was $0.09 for the full year of 2016, compared with ($0.12) per diluted share for the full year of 2015.

Balance Sheet: Total cash and cash equivalents at the end of 2016 was $160.4 million, compared with $137.6 million at the end of 2015.

Fourth Quarter 2016 and Recent Business Highlights

RingCentral Global Office(TM) has expanded to provide a local experience in over 30 countries and has been adopted by over 600 multinational enterprises.

Announced that Structural Group has selected RingCentral as its new cloud communications and collaboration solution provider. With more than 1,800 employees across 22 locations in North America, Structural Group needed a new generation of flexible, mobile-first solutions to enhance customer engagement and productivity for its distributed and mobile workforce.

Announced that Sungevity will replace its existing legacy on-premise PBX system and other applications for over 700 users with RingCentral. RingCentral’s architecture and open platform makes for a seamless integration with Sungevity’s existing business process and software platform. RingCentral will reduce Sungevity’s communication and collaboration solution costs by nearly 50 percent.

Achieved milestone of issuing 100th U.S. patent, reinforcing RingCentral’s strong commitment to technology development and intellectual property protection.

RingCentral Connect Platform reached 1.6 million API requests per day and a 300% annual increase in API requests overall.

Announced the addition of Extended Enterprise Support to the RingCentral Professional Services(TM) portfolio. This program provides enterprises requiring premium support services a dedicated team of technical account managers and customer success managers.

Conference Call Details:

What: RingCentral financial results for the fourth quarter and full year of 2016 and outlook for the first quarter and full year of 2017.

-- When: Monday, February 13, 2017 at 1:30PM PT (4:30PM ET).

Dial in: To access the call in the United States, please dial (877) 705-6003, and for international callers dial (201) 493-6725. Callers may provide confirmation number 13653961 to access the call more quickly, and are encouraged to dial into the call 10 to 15 minutes prior to the start to prevent any delay in joining.

Webcast: http://ir.ringcentral.com/ (live and replay).

Replay: A replay of the call will be available via telephone for seven days, beginning two hours after the call. To listen to the telephone replay in the U.S., please dial (844) 512-2921 from the United States or (412) 317-6671 internationally with recording access code 13653961.

About RingCentral

RingCentral, Inc. (RNG) is a global provider of cloud unified communications and collaboration solutions. More flexible and cost-effective than legacy on-premise systems, RingCentral empowers today’s mobile and distributed workforce to be connected anywhere and on any device through voice, video, team messaging, collaboration, SMS, conferencing, online meetings, contact center, and fax. RingCentral provides an open platform that integrates with today’s leading business apps while giving customers the flexibility to customize their own workflows. RingCentral is a leader in the 2016 Gartner Magic Quadrant for Unified Communications as a Service Worldwide for the second consecutive year. RingCentral is headquartered in Belmont, Calif. RingCentral and the RingCentral logo are trademarks of RingCentral, Inc.

Forward-Looking Statements

This press release contains "forward-looking statements," including but not limited to, statements regarding our future, our GAAP and non-GAAP guidance, our markets and strategic opportunities, and our expectations regarding our strategy of providing integrated global open communications and collaboration solutions, our reseller channels, our revenue growth and our momentum to reach $1 billion in revenues. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on assumptions that may prove to be incorrect, which could cause actual results to differ materially from those expected or implied by the forward-looking statements. Among the important factors that could cause actual results to differ materially from those in any forward-looking statements are: our ability to grow at our expected rate of growth; our ability to add and retain larger and enterprise customers and enter new geographies and markets; our ability to continue to release, and gain customer acceptance of, new and improved versions of our services; our ability to compete successfully against existing and new competitors; our ability to enter into and maintain relationships with carriers and other resellers; our ability to manage our expenses and growth; and general market, political, economic, and business conditions, as well as those risks and uncertainties included under the captions "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations," in our Form 10-Q for the quarter ended September 30, 2016, filed with the Securities and Exchange Commission; and in other filings we make with the Securities and Exchange Commission from time to time.

All forward-looking statements in this press release are based on information available to RingCentral as of the date hereof, and we undertake no obligation to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current financial quarter.

Non-GAAP Financial Measures

Our reported financial results include certain Non-GAAP financial measures, including Non-GAAP operating income (loss), Non-GAAP operating margin, Non-GAAP net income (loss), and Non-GAAP net income (loss) per diluted share. Non-GAAP operating income (loss) is defined as operating income (loss) excluding share-based compensation, amortization of acquisition intangibles, and acquisition related matters. Non-GAAP operating margin is defined as Non-GAAP operating income (loss) divided by total GAAP revenue. Non-GAAP net income (loss) is defined as net income (loss) excluding stock-based compensation, intercompany remeasurement gains or losses, acquisition related matters, amortization of acquisition intangibles, and tax benefit for release of valuation allowance.

We have included Non-GAAP operating income (loss), Non-GAAP operating margin, Non-GAAP net income (loss), and Non-GAAP net income (loss) per diluted share in this press release because they are key measures used by us to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short and long-term operational plans. In particular, the exclusion of certain expenses in calculating Non-GAAP operating income (loss), Non-GAAP operating margin, Non-GAAP net income (loss), and Non-GAAP net income (loss) per diluted share can provide a useful measure for period-to-period comparisons of our core business.

Although Non-GAAP operating income (loss), Non-GAAP operating margin, Non-GAAP net income (loss), and Non-GAAP net income (loss) per diluted share are frequently used by investors in their evaluations of companies, these non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Because of these limitations, these non-GAAP financial measures should be considered alongside other financial performance measures. Reconciliations of the Company’s historical non-GAAP financial measures and key metrics to their most directly comparable GAAP measures has been provided in the financial statement tables included in this press release.

Other Measures

Our reported results also include our total annualized exit monthly recurring subscriptions, RingCentral Office(R) annualized exit monthly recurring subscriptions, and net monthly subscriptions dollar retention. We define our total annualized exit monthly recurring subscriptions as our total monthly recurring subscriptions multiplied by 12. Our total monthly recurring subscriptions equal the monthly value of all customer subscriptions in effect at the end of a given month. We believe this metric is a leading indicator of our anticipated subscriptions revenue. We calculate our RingCentral Office(R) annualized exit monthly recurring subscriptions in the same manner as we calculate our total annualized exit monthly recurring subscriptions, except that only customer subscriptions from RingCentral Office(R) customers are included when determining monthly recurring subscriptions for the purposes of calculating this key business metric. We define Dollar Net Change as the quotient of (i) the difference of our Monthly Recurring Subscriptions at the end of a period minus our Monthly Recurring Subscriptions at the beginning of a period minus our Monthly Recurring Subscriptions at the end of the period from new customers we added during the period, (ii) all divided by the number of months in the period. We define our Average Monthly Recurring Subscriptions as the average of the Monthly Recurring Subscriptions at the beginning and end of the measurement period.

(1) In 1Q’16, RingCentral transitioned direct phone sales to an agency model, in which RingCentral receives a commission for phone sales instead of separately recognizing the full sale price and cost of the product. RingCentral is providing supplemental information on a pro forma basis to provide a clear comparison of the Company’s results with prior periods as-if the Company had transitioned phone sales to the new agency model on January 1, 2015. Carrier phone sales remained under the direct phone sales model.

TABLE 1
RINGCENTRAL, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands)
December 31, 2016
December 31, 2015
Assets
Current assets
Cash and cash equivalents
$
160,355
$
137,588
Accounts receivable, net
30,243
19,163
Inventory
63
2,317
Prepaid expenses and other current assets
15,250
11,978
Total current assets
205,911
171,046
Property and equipment, net
31,994
28,160
Goodwill
9,393
9,393
Acquired intangibles, net
2,244
3,266
Other assets
3,087
2,948
Total assets
$
252,629
$
214,813
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable
$
7,810
$
5,196
Accrued liabilities
48,322
34,702
Current portion of capital lease obligation
181
269
Current portion of long-term debt
14,528
3,750
Deferred revenue
45,159
36,657
Total current liabilities
116,000
80,574
Long-term debt
312
14,840
Sales tax liability
3,077
3,670
Capital lease obligation
-
181
Other long-term liabilities
3,199
5,416
Total liabilities
122,588
104,681
Stockholders’ equity
Common stock
7
7
Additional paid-in capital
366,800
319,792
Accumulated other comprehensive income
2,737
527
Accumulated deficit
(239,503 )
(210,194 )
Total stockholders’ equity
130,041
110,132
Total liabilities and stockholders’ equity
$
252,629
$
214,813
TABLE 2
RINGCENTRAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share data)
Three Months Ended
Year Ended
December 31,
December 31,
2016
2015
2016
2015
Revenues
Software subscriptions
$
97,952
$ 76,532
$ 355,850
$ 271,245
Other
6,551
6,907
23,874
24,983
Total revenues
104,503
83,439
379,724
296,228
Cost of revenues
Software subscriptions
19,363
16,851
73,470
66,354
Other
5,289
6,011
18,741
20,917
Total cost of revenues
24,652
22,862
92,211
87,271
Gross profit
79,851
60,577
287,513
208,957
Operating expenses
Research and development
17,417
15,312
65,514
52,924
Sales and marketing
54,701
38,378
192,497
139,851
General and administrative
14,339
12,883
55,454
47,114
Total operating expenses
86,457
66,573
313,465
239,889
Loss from operations
(6,606 )
(5,996 )
(25,952 )
(30,932 )
Other income (expense), net
Interest expense
(162 )
(196 )
(746 )
(1,123 )
Other income (expense), net
(94 )
(670 )
(2,375 )
(1,307 )
Other income (expense), net
(256 )
(866 )
(3,121 )
(2,430 )
Loss before provision (benefit) for income taxes
(6,862 )
(6,862 )
(29,073 )
(33,362 )
Provision (benefit) for income taxes
84
79
236
(1,263 )
Net loss
$
(6,946 )
$ (6,941 )
$ (29,309 )
$ (32,099 )
Net loss per common share
Basic and diluted
$
(0.09 )
$
(0.10 )
$
(0.40 )
$
(0.46 )
Weighted-average number of shares used in computing net loss per
share
Basic and diluted
73,961
71,420
72,994
70,069
TABLE 3
RINGCENTRAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
Year Ended
December 31,
2016
2015
Cash flows from operating activities
Net loss
$
(29,309 )
$
(32,099 )
Adjustments to reconcile net loss to net cash provided by operating
activities
Depreciation and amortization
14,663
13,467
Share-based compensation
30,840
22,088
Foreign currency remeasurement loss
2,615
843
Tax benefit from release of valuation allowance
--
(1,411 )
Impairment of fixed assets
--
1,317
Non-cash interest expense and other expenses related to debt
--
156
Net accretion of discount and amortization of premium on
--
616
available-for-sale securities
Provision for bad debt
648
411
Deferred income taxes
(36 )
(8 )
Others
583
416
Changes in assets and liabilities:
Accounts receivable
(11,728 )
(11,923 )
Inventory
2,254
(606 )
Prepaid expenses and other current assets
(3,272 )
(3,636 )
Other assets
76
(422 )
Accounts payable
1,516
1,591
Accrued liabilities
15,165
2,354
Deferred revenue
8,502
11,071
Other liabilities
(2,809 )
861
Net cash provided by operating activities
29,708
5,086
Cash flows from investing activities
Purchases of property and equipment
(14,236 )
(14,631 )
Capitalized internal-use software
(2,162 )
(2,513 )
Cash paid in business combination, net of cash acquired
--
(4,670 )
Proceeds from the maturity of available-for-sale securities
--
28,080
Proceeds from the maturity of restricted investments
--
100
Net cash provided by (used in) investing activities
(16,398 )
6,366
Cash flows from financing activities
Proceeds from issuance of stock in connection with stock plans
15,104
19,524
Taxes paid related to net share settlement of equity awards
(255 )
(151 )
Payment of holdback from Glip acquisition
(1,500 )
--
Repayment of debt
(3,750 )
(6,142 )
Repayment of capital lease obligations
(269 )
(594 )
Net cash provided by financing activities
9,330
12,637
Effect of exchange rate changes on cash and cash equivalents
127
317
Net increase in cash and cash equivalents
22,767
24,406
Cash and cash equivalents
Beginning of period
137,588
113,182
End of period
$
160,355
$
137,588
TABLE 4
RINGCENTRAL, INC.
RECONCILIATION OF OPERATING INCOME (LOSS)
GAAP MEASURES TO NON-GAAP MEASURES
(Unaudited, in thousands)
Three Months Ended
Year Ended
December 31,
December 31,
2016
2015
2016
2015
Revenues
Software subscriptions
$
97,952
$ 76,532
$ 355,850
$ 271,245
Other
6,551
6,907
23,874
24,983
Total revenues
104,503
83,439
379,724
296,228
Cost of revenues reconciliation
GAAP Software subscriptions cost of revenues
19,363
16,851
73,470
66,354
Stock-based compensation
(810 )
(586 )
(3,048 )
(2,054 )
Amortization of acquisition intangibles
(151 )
-
(603 )
-
Non-GAAP Software subscriptions cost of revenues
18,402
16,265
69,819
64,300
GAAP Other cost of revenues
5,289
6,011
18,741
20,917
Stock-based compensation
(31 )
-
(117 )
-
Non-GAAP Other cost of revenues
5,258
6,011
18,624
20,917
Gross profit and gross margin reconciliation
Non-GAAP Subscriptions
81.2 %
78.7 %
80.4 %
76.3 %
Non-GAAP Other
19.7 %
13.0 %
22.0 %
16.3 %
Non-GAAP Gross profit
77.4 %
73.3 %
76.7 %
71.2 %
Operating expenses reconciliation
GAAP Research and development
17,417
15,312
65,514
52,924
Stock-based compensation
(1,805 )
(1,642 )
(7,296 )
(5,387 )
Amortization of acquisition intangibles
-
(151 )
-
(480 )
Acquisition related matters
(309 )
(244 )
(1,411 )
(575 )
Non-GAAP Research and development
15,303
13,275
56,807
46,482
As a % of total revenues non-GAAP
14.6 %
15.9 %
15.0 %
15.7 %
GAAP Sales and marketing
54,701
38,378
192,497
139,851
Stock-based compensation
(3,111 )
(1,867 )
(10,902 )
(7,200 )
Amortization of acquisition intangibles
(105 )
(105 )
(420 )
(105 )
Non-GAAP Sales and marketing
51,485
36,406
181,175
132,546
As a % of total revenues non-GAAP
49.3 %
43.6 %
47.7 %
44.7 %
GAAP General and administrative
14,339
12,883
55,454
47,114
Stock-based compensation
(2,480 )
(2,203 )
(9,477 )
(7,447 )
Acquisition related matters
-
(39 )
(59 )
(787 )
Non-GAAP General and administrative
11,859
10,641
45,918
38,880
As a % of total revenues non-GAAP
11.3 %
12.8 %
12.1 %
13.1 %
Income (loss) from operations reconciliation
GAAP loss from operations
(6,606 )
(5,996 )
(25,952 )
(30,932 )
Stock-based compensation
8,237
6,298
30,840
22,088
Amortization of acquisition intangibles
256
256
1,023
585
Acquisition related matters
309
283
1,470
1,362
Non-GAAP Income (loss) from operations
$
2,196
$
841
$
7,381
$
(6,897 )
Non-GAAP Operating margin
2.1 %
1.0 %
1.9 %
(2.3 %)
TABLE 5
RINGCENTRAL, INC.
RECONCILIATION OF NET INCOME (LOSS)
GAAP MEASURES TO NON-GAAP MEASURES
(In thousands, except per share data)
(Unaudited)
Three Months Ended
Year Ended
December 31,
December 31,
2016
2015
2016
2015
Net Income (loss) reconciliation
GAAP Net loss
$ (6,946 )
$ (6,941 )
$ (29,309 )
$ (32,099 )
Stock-based compensation
8,237
6,298
30,840
22,088
Amortization of acquisition intangibles
256
256
1,023
585
Acquisition related matters
309
283
1,470
1,362
Intercompany remeasurement loss
167
594
2,508
928
Tax benefit from release of valuation allowance
-
-
-
(1,411 )
Non-GAAP Net income (loss)
$
2,023
$
490
$
6,532
$
(8,547 )
Basic and diluted net income (loss) per share
Reconciliation between GAAP and non-GAAP weighted average shares
used in computing basic and diluted net income / (loss) per common
share:
Weighted average number of shares used in computing
73,961
71,420
72,994
70,069
net loss per share
Effect of dilutive securities
3,606
3,612
3,414
-
Non-GAAP weighted average shares used in computing
77,567
75,032
76,408
70,069
non-GAAP net income per share
GAAP Net loss per share
$
(0.09 )
$
(0.10 )
$
(0.40 )
$
(0.46 )
Non-GAAP Net income (loss) per share
$
0.03
$
0.01
$
0.09
$
(0.12 )
TABLE 6
RINGCENTRAL, INC.
PRO FORMA(2) STATEMENT OF GROSS MARGIN
UNDER AGENCY MODEL
(Unaudited, in thousands)
2015
2016
4Q’16
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
Q/Q
Y/Y
GAAP Software subscription revenue
$
59,951
$
64,441
$
70,321
$
76,532
$ 79,978
$
86,067
$
91,853
$
97,952
7 %
28 %
GAAP Other revenue
$
5,367
$
6,250
$
6,459
$
6,907
$
6,560
$
5,777
$
4,986
$
6,551
Revised Agency Model adjustment
(2,222 )
(2,101 )
(2,278 )
(2,597 )
(1,436 )
--
--
--
Pro forma other revenue
$
3,145
$
4,149
$
4,181
$
4,310
$
5,124
$
5,777
$
4,986
$
6,551
31 %
52 %
Total pro forma revenue
$
63,096
$
68,590
$
74,502
$
80,842
$ 85,102
$
91,844
$
96,839
$
104,503
8 %
29 %
GAAP Software subscription cost of revenue
$
15,914
$
16,505
$
17,084
$
16,851
$ 16,723
$
18,173
$
19,211
$
19,363
Stock-based compensation
(457 )
(476 )
(535 )
(586 )
(634 )
(781 )
(824 )
(810 )
--
--
--
--
(151 )
(151 )
(151 )
(151 )
Amortization of acquisition intangibles
Non-GAAP Software subscriptions cost of revenue
$
15,457
$
16,029
$
16,549
$
16,265
$ 15,938
$
17,241
$
18,236
$
18,402
GAAP Other cost of revenue
$
4,633
$
5,024
$
5,249
$
6,011
$
5,017
$
4,191
$
4,244
$
5,289
Stock-based compensation
--
--
--
--
(19 )
(32 )
(35 )
(31 )
Non-GAAP Other cost of revenue
$
4,633
$
5,024
$
5,249
$
6,011
$
4,998
$
4,159
$
4,209
$
5,258
Revised Agency Model adjustment
(2,222 )
(2,101 )
(2,278 )
(2,597 )
(1,436 )
--
--
--
Pro forma other cost of revenue
$
2,411
$
2,923
$
2,971
$
3,414
$
3,562
$
4,159
$
4,209
$
5,258
Total pro forma cost of revenue
$
17,868
$
18,952
$
19,520
$
19,679
$ 19,500
$
21,400
$
22,445
$
23,660
5 %
20 %
Pro forma software subscriptions revenue gross profit
$
44,494
$
48,412
$
53,772
$
60,267
$ 64,040
$
68,826
$
73,617
$
79,550
8 %
32 %
Pro forma other revenue gross profit
734
1,226
1,210
896
1,562
1,618
777
1,293
66 %
44 %
Total pro forma gross profit
$
45,228
$
49,638
$
54,982
$
61,163
$ 65,602
$
70,444
$
74,394
$
80,843
9 %
32 %
Pro forma software subscriptions revenue gross margin
74 %
75 %
76 %
79 %
80 %
80 %
80 %
81 %
Pro forma other revenue gross margin
23 %
30 %
29 %
21 %
30 %
28 %
16 %
20 %
Total pro forma gross margin
72 %
72 %
74 %
76 %
77 %
77 %
77 %
77 %
(2)In 1Q’16, RingCentral provided supplemental information
on a pro forma basis to provide a clear comparison of the Company’s
results with prior periods. The pro forma information reflects
results as-if the Company had transitioned to the new agency model
for the first quarter of 2016 and for all periods in 2015.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20170213006068r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20170213006068/en/

SOURCE: RingCentral, Inc.

RingCentral
Investor Relations Contact:
Darren Yip, 650-641-2220
ir@RingCentral.com
or
Media Contact:
Jennifer Caukin, 650-561-6348
Jennifer.caukin@ringcentral.com