Dynatrace Inc.

02/01/2023 | Press release | Distributed by Public on 02/01/2023 05:52

Financial Data Trends Table Q3 2023

Disclosures

Non-GAAP Financial Measures & Key Metrics
In addition to disclosing financial measures prepared in accordance with GAAP, thes tables contain certain non-GAAP financial measures. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similarly titled measures presented by other companies. Dynatrace considers these non-GAAP financial measures to be important because they provide useful indicators of its performance and liquidity measures. These are key measures used by our management and board of directors 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 addition, investors often use similar measures to evaluate the performance of a company. Non-GAAP financial measures are presented for supplemental informational purposes only for understanding the company's operating performance. The non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP financial measures presented by other companies. The GAAP financial measure most directly comparable to each non-GAAP financial measure used or discussed, and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure, are included in this press release after the consolidated financial statements. Dynatrace presents constant currency amounts for Revenue and Annual Recurring Revenue to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the comparative period rather than the actual exchange rates in effect during the respective periods. All growth comparisons relate to the corresponding period in the last fiscal year. Dynatrace provides this non-GAAP financial information to aid investors in better understanding our performance.
Annual Recurring Revenue "ARR" is defined as the daily revenue of all subscription agreements that are actively generating revenue as of the last day of the reporting period multiplied by 365. We exclude from our calculation of Total ARR any revenues derived from month-to-month agreements and/or product usage overage billings.
Adjusted ARR is defined as ARR excluding the impact of foreign exchange rate fluctuations that occurred over the trailing twelve month period. This calculation also excludes the headwind associated with the Dynatrace® perpetual license ARR that rolled off in the trailing twelve month period.
Adjusted ARR Growth is defined as year-over-year growth in Adjusted ARR divided by ARR as reported.
Free Cash Flow is defined as net cash provided by (used in) operating activities less capital expenditures.

GAAP Income Statement

Dynatrace, Inc.
Historical Income Statements QTD
(in thousands)
FY 2021 FY 2022 FY 2023
30-Jun-20 30-Sep-20 31-Dec-20 31-Mar-21 31-Mar-21 30-Jun-21 30-Sep-21 31-Dec-21 31-Mar-22 31-Mar-22 30-Jun-22 30-Sep-22 31-Dec-22
Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 YTD Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 YTD Q1 2023 Q2 2023 Q3 2023 TTM
Revenue:
Subscription 144,357 157,673 170,308 182,842 655,180 196,520 212,601 226,290 234,974 870,385 249,558 261,306 279,152 1,024,990
License 638 442 257 109 1,446 50 0 2 2 54 0 0 0 2
Service 10,513 10,471 12,346 13,553 46,883 13,170 13,753 14,474 17,609 59,006 17,715 18,020 18,304 71,648
Total revenue 155,508 168,586 182,911 196,504 703,509 209,740 226,354 240,766 252,585 929,445 267,273 279,326 297,456 1,096,640
Cost of revenue:
Cost of subscription 16,706 18,327 20,382 22,073 77,488 24,982 27,135 28,284 31,245 111,646 32,738 35,764 36,891 136,638
Cost of service 8,010 8,554 8,907 9,432 34,903 10,021 10,668 12,232 12,796 45,717 15,168 16,052 15,044 59,060
Amortization of acquired technology 3,826 3,830 3,831 3,830 15,317 3,830 3,864 3,944 3,875 15,513 3,892 3,888 3,889 15,544
Total cost of revenue 28,542 30,711 33,120 35,335 127,708 38,833 41,667 44,460 47,916 172,876 51,798 55,704 55,824 211,242
Gross profit 126,966 137,875 149,791 161,169 575,801 170,907 184,687 196,306 204,669 756,569 215,475 223,622 241,632 885,398
Gross profit % 82% 82% 82% 82% 82% 81% 82% 82% 81% 81% 81% 80% 81% 81%
Operating expenses:
Research and development 23,505 27,512 28,730 31,668 111,415 34,725 37,908 40,876 42,833 156,342 48,482 51,907 53,411 196,633
Sales and marketing 49,163 56,690 64,829 74,805 245,487 80,482 86,301 94,033 101,300 362,116 105,015 104,669 111,524 422,508
General and administrative 21,527 22,110 23,442 25,140 92,219 26,922 31,689 32,643 35,368 126,622 36,321 40,074 36,242 148,005
Amortization of other intangibles 8,686 8,686 8,685 8,687 34,744 7,540 7,539 7,539 7,539 30,157 6,573 6,573 6,573 27,258
Restructuring and other (21) 46 (2) 17 40 26 (1) 0 0 25 (10) 0 (5) (15)
Total operating expenses 102,860 115,044 125,684 140,317 483,905 149,695 163,436 175,091 187,040 675,262 196,381 203,223 207,745 794,389
Income from operations 24,106 22,831 24,107 20,852 91,896 21,212 21,251 21,215 17,629 81,307 19,094 20,399 33,887 91,009
Interest expense, net (4,113) (3,602) (3,455) (3,035) (14,205) (2,857) (2,651) (2,450) (2,234) (10,192) (2,175) (513) (4,787) (9,709)
Other income (expense), net 19 199 2,526 (2,582) 162 1,311 (1,299) (1,357) 1,889 544 (2,250) (1,214) 1,617 42
Income before income taxes 20,012 19,428 23,178 15,235 77,853 19,666 17,301 17,408 17,284 71,659 14,669 18,672 30,717 81,342
Income tax (expense) benefit (7,147) (1,949) (4,762) 11,719 (2,139) (6,372) 6,340 (2,821) (16,355) (19,208) (12,555) (8,146) (15,691) (52,747)
Net income 12,865 17,479 18,416 26,954 75,714 13,294 23,641 14,587 929 52,451 2,114 10,526 15,026 28,595
Other comprehensive (loss) income:
Foreign currency translation adjustment (2,342) (2,792) (4,786) 1,814 (8,106) (1,658) 2,394 692 (1,906) (478) 480 1,818 (5,133) (4,741)
Total other comprehensive (loss) income (2,342) (2,792) (4,786) 1,814 (8,106) (1,658) 2,394 692 (1,906) (478) 480 1,818 (5,133) (4,741)
Comprehensive income (loss) 10,523 14,687 13,630 28,768 67,608 11,636 26,035 15,279 (977) 51,973 2,594 12,344 9,893 23,854

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Balance Sheet

Dynatrace, Inc.
Historical Balance Sheets
(in thousands)
FY 2021 FY 2022 FY 2023
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
June 2020(1) September 2020(1) December 2020(1) March 2021 June 2021 September 2021 December 2021 March 2022 June 2022 September 2022 December 2022
Assets
Current assets:
Cash and cash equivalents 250,377 248,437 299,505 324,962 387,218 370,319 408,723 462,967 571,345 563,430 422,451
Accounts receivable, net 93,763 110,251 200,849 242,079 134,003 149,801 264,293 350,666 191,836 185,728 304,411
Deferred commissions, current 39,080 41,190 45,645 48,986 50,987 52,525 57,978 62,601 61,182 62,861 71,001
Prepaid expenses and other current assets 76,568 79,113 46,356 64,255 65,838 80,065 81,326 72,188 35,439 39,259 33,034
Total Current assets 459,788 478,991 592,355 680,282 638,046 652,710 812,320 948,422 859,802 851,278 830,897
Property and equipment, net 33,673 33,920 35,384 36,916 37,841 40,197 41,984 45,271 45,782 45,717 50,528
Operating lease right of use asset, net 44,209 42,571 43,530 42,959 48,338 60,473 59,306 58,849 53,369 61,374 68,730
Goodwill 1,270,986 1,271,602 1,272,574 1,271,195 1,275,133 1,282,631 1,281,764 1,281,876 1,280,511 1,279,535 1,281,507
Other intangible assets, net 188,717 175,789 162,882 149,484 137,993 128,514 117,908 105,736 95,008 84,380 74,073
Deferred tax assets, net 8,126 11,395 12,205 16,811 17,012 16,492 16,390 28,106 26,368 24,958 23,726
Deferred commissions, non-current 37,778 38,074 43,575 48,638 50,001 50,766 58,086 63,435 59,245 60,292 69,150
Other assets 8,350 8,616 8,850 9,933 9,735 11,114 10,003 9,615 10,564 14,451 15,268
Total assets 2,051,627 2,060,958 2,171,355 2,256,218 2,214,099 2,242,897 2,397,761 2,541,310 2,430,649 2,421,985 2,413,879
Liabilities and shareholders' equity
Current Liabilities:
Accounts payable 3,767 8,185 12,146 9,621 3,431 16,013 22,256 22,715 4,795 4,587 14,687
Accrued expenses, current 76,191 85,782 106,072 119,527 98,955 105,423 116,154 141,556 114,214 129,976 154,081
Current portion of long term debt 0 0 0 0 0 0 0 0 0 0 0
Deferred revenue, current 352,803 349,541 424,001 509,272 486,066 461,443 563,045 688,554 617,969 561,474 647,259
Operating lease liabilities, current 9,712 9,311 9,368 9,491 10,420 11,214 11,700 12,774 12,402 12,876 14,990
Payable to related party 0 0 0 0 0 0 0 0 0 0
Total current liabilities 442,473 452,819 551,587 647,911 598,872 594,093 713,155 865,599 749,380 708,913 831,017
Deferred revenue, non-current 49,580 44,647 47,849 47,504 33,683 22,630 30,937 25,783 16,352 16,950 25,778
Accrued expenses, non-current 17,368 17,615 17,714 16,072 16,349 16,533 20,046 19,409 28,182 25,243 30,449
Operating lease liabilities, non-current 38,970 37,817 38,829 38,203 42,823 54,371 52,976 52,070 46,682 54,255 59,589
Deferred tax liabilities, net 0 0 0 1,014 1,014 1,361 1,217 85 0 0 23
Long term debt, net of current portion 510,452 480,941 451,427 391,913 362,404 332,907 303,415 273,918 244,427 214,947 0
Total liabilities 1,058,843 1,033,839 1,107,406 1,142,617 1,055,145 1,021,895 1,121,746 1,236,864 1,085,023 1,020,308 946,856
Shareholders' Equity:
Common shares 281 281 281 283 284 285 286 286 287 288 289
Additional paid-in capital 1,589,598 1,609,246 1,632,446 1,653,328 1,687,044 1,723,056 1,762,789 1,792,197 1,830,782 1,874,488 1,929,940
Accumulated deficit (576,648) (559,169) (540,753) (513,799) (500,505) (476,864) (462,277) (461,348) (459,234) (448,708) (433,682)
Accumulated other comprehensive loss (20,447) (23,239) (28,025) (26,211) (27,869) (25,475) (24,783) (26,689) (26,209) (24,391) (29,524)
Total shareholders' equity 992,784 1,027,119 1,063,949 1,113,601 1,158,954 1,221,002 1,276,015 1,304,446 1,345,626 1,401,677 1,467,023
Total liabilities and shareholders' equity 2,051,627 2,060,958 2,171,355 2,256,218 2,214,099 2,242,897 2,397,761 2,541,310 2,430,649 2,421,985 2,413,879
(1)Prior periods have been updated from previously issued financial statements

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Cash Flows

Dynatrace, Inc.
Historical Cash Flows
(in thousands)
FY 2021 FY 2022 FY 2023
Q1 Q2 Q3 Q4 FY Q1(1) Q2(1) Q3(1) Q4 FY Q1 Q2 Q3 TTM
Cash flows from operating activities:
Net income 12,865 17,479 18,416 26,954 75,714 13,294 23,641 14,587 929 52,451 2,114 10,526 15,026 28,595
Adjustments to reconcile net income to cash provided by operations:
Depreciation 1,590 2,207 2,792 2,433 9,022 2,475 2,574 2,739 2,850 10,638 2,798 2,948 3,266 11,862
Amortization 13,019 13,013 13,014 12,896 51,942 11,512 11,545 11,625 11,556 46,238 10,571 10,497 10,498 43,122
Share-based compensation 12,672 14,831 15,588 14,693 57,784 19,252 25,575 27,123 27,586 99,536 28,695 40,654 35,504 132,439
Deferred income taxes (175) (2,985) 146 (4,022) (7,036) - 0 - 0 - 0 (12,435) (12,435) - 0 - 0 - 0 (12,435)
Loss on extinguishment of debt - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 5,925 5,925
Other 466 336 (2,042) 3,085 1,845 (796) 1,806 1,896 (1,386) 1,520 2,748 1,736 687 3,785
Net change in operating assets and liabilities: - 0
Accounts receivable 64,265 (14,912) (87,046) (44,299) (81,992) 110,079 (17,765) (114,676) (86,486) (108,848) 151,404 2,108 (113,198) (46,172)
Deferred commissions 2,229 (979) (7,630) (9,943) (16,323) (2,631) (3,716) (13,234) (9,952) (29,533) 2,079 (5,697) (13,580) (27,150)
Prepaid expenses and other assets 275 (5,219) 30,864 (20,251) 5,669 (1,453) (15,003) (1,052) 9,400 (8,108) 33,096 (7,968) 4,488 39,016
Accounts payable and accrued expenses (23,212) 15,350 22,753 11,701 26,592 (27,376) 18,258 20,105 24,959 35,946 (29,815) 15,387 33,793 44,324
Operating leases, net 311 212 76 132 731 131 270 282 670 1,353 (142) 186 (80) 634
Deferred revenue (47,297) (15,492) 66,785 92,492 96,488 (41,015) (28,889) 111,449 120,614 162,159 (60,450) (40,979) 79,633 98,818
Net cash provided by operating activities 37,008 23,841 73,716 85,871 220,436 83,472 18,296 60,844 88,305 250,917 143,098 29,398 61,962 322,763
Cash flows from investing activities:
Purchase of property and equipment (4,418) (1,982) (2,468) (5,208) (14,076) (2,954) (4,658) (4,156) (5,927) (17,695) (6,906) (4,331) (4,388) (21,552)
Acquisitions, net of cash acquired - 0 - 0 - 0 - 0 - 0 (3,543) (9,461) (191) - 0 (13,195) - 0 - 0 - 0 - 0
Capitalized software additions (131) (53) (64) 445 197 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Net cash used in investing activities (4,549) (2,035) (2,532) (4,763) (13,879) (6,497) (14,119) (4,347) (5,927) (30,890) (6,906) (4,331) (4,388) (21,552)
Cash flows from financing activities:
Repayment of term loans - 0 (30,000) (30,000) (60,000) (120,000) (30,000) (30,000) (30,000) (30,000) (120,000) (30,000) (30,000) (221,125) (311,125)
Debt issuance costs - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 (1,949) (1,949)
Proceeds from employee stock purchase plan 3,592 - 0 5,603 - 0 9,195 6,593 - 0 7,320 - 0 13,913 8,627 - 0 9,179 17,806
Proceeds from exercise of stock options - 0 4,829 2,020 6,203 13,052 7,886 10,453 5,311 1,839 25,489 1,275 3,057 10,770 16,941
Equity repurchases (13) (12) (11) (13) (49) (14) (16) (21) (15) (66) (11) (4) - 0 (30)
Net cash provided by (used in) financing activities 3,579 (25,183) (22,388) (53,810) (97,802) (15,535) (19,563) (17,390) (28,176) (80,664) (20,109) (26,947) (203,125) (278,357)
Effect of exchange rates on cash and cash equivalents 1,169 1,437 2,272 (1,841) 3,037 816 (1,513) (703) 42 (1,358) (7,705) (6,035) 4,572 (9,126)
Net increase (decrease) in cash and cash equivalents 37,207 (1,940) 51,068 25,457 111,792 62,256 (16,899) 38,404 54,244 138,005 108,378 (7,915) (140,979) 13,728
Cash and cash equivalents, beginning of period 213,170 250,377 248,437 299,505 213,170 324,962 387,218 370,319 408,723 324,962 462,967 571,345 563,430 408,723
Cash and cash equivalents, end of period 250,377 248,437 299,505 324,962 324,962 387,218 370,319 408,723 462,967 462,967 571,345 563,430 422,451 422,451
Supplemental cash flow data:
Cash paid for interest 3,763 3,160 2,991 2,561 12,475 2,370 2,190 1,989 1,826 8,375 2,066 2,677 2,124 8,693
Cash paid for (received from) tax 10,127 12,418 (37,017) 7,135 (7,337) 7,306 5,076 7,848 4,017 24,247 (31,542) 7,975 3,232 (16,318)
Non-cash financing activities:
Transactions with related parties - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Reclassification of related party payable upon reorganization - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Modification of MIU Plan awards - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
(1)Prior period has been updated from previously issued financial statements

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Non GAAP Tables

Dynatrace, Inc.
GAAP to Non-GAAP Tables
(in thousands)
FY 2021 FY 2022 FY 2023
Q1(1) Q2(1) Q3(1) Q4(1) FY Q1(1) Q2(1) Q3(1) Q4 FY Q1 Q2 Q3 TTM
Revenue 155,508 168,586 182,911 196,504 703,509 209,740 226,354 240,766 252,585 929,445 267,273 279,326 297,456 1,096,640
Share-based compensation - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Employer payroll taxes on employee stock transactions - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Amortization of other intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Non-GAAP Revenue 155,508 168,586 182,911 196,504 703,509 209,740 226,354 240,766 252,585 929,445 267,273 279,326 297,456 1,096,640
Cost of Revenue 28,542 30,711 33,120 35,335 127,708 38,833 41,667 44,460 47,916 172,876 51,798 55,704 55,824 211,242
Share-based compensation (1,498) (1,866) (2,066) (1,877) (7,307) (2,652) (3,485) (3,405) (3,321) (12,863) (3,890) (5,235) (4,285) (16,731)
Employer payroll taxes on employee stock transactions (53) (359) (82) (224) (718) (315) (452) (149) (143) (1,059) (284) (128) (114) (669)
Amortization of other intangibles (3,826) (3,830) (3,831) (3,830) (15,317) (3,830) (3,864) (3,944) (3,875) (15,513) (3,892) (3,888) (3,889) (15,544)
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 (350) (30) - 0 (380)
Non-GAAP Cost of Revenue 23,165 24,656 27,141 29,404 104,366 32,036 33,866 36,962 40,577 143,441 43,382 46,423 47,536 177,918
Gross Profit 126,966 137,875 149,791 161,169 575,801 170,907 184,687 196,306 204,669 756,569 215,475 223,622 241,632 885,398
Share-based compensation 1,498 1,866 2,066 1,877 7,307 2,652 3,485 3,405 3,321 12,863 3,890 5,235 4,285 16,731
Employer payroll taxes on employee stock transactions 53 359 82 224 718 315 452 149 143 1,059 284 128 114 669
Amortization of other intangibles 3,826 3,830 3,831 3,830 15,317 3,830 3,864 3,944 3,875 15,513 3,892 3,888 3,889 15,544
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 350 30 - 0 380
Non-GAAP Gross Profit 132,343 143,930 155,770 167,100 599,143 177,704 192,488 203,804 212,008 786,004 223,891 232,903 249,920 918,722
Research and Development 23,505 27,512 28,730 31,668 111,415 34,725 37,908 40,876 42,833 156,342 48,482 51,907 53,411 196,633
Share-based compensation (2,418) (2,989) (3,259) (3,018) (11,684) (3,967) (5,456) (5,908) (5,985) (21,316) (7,285) (10,997) (11,057) (35,324)
Employer payroll taxes on employee stock transactions (98) (592) (288) (378) (1,356) (627) (500) (493) (259) (1,879) (549) (381) (329) (1,518)
Amortization of other intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Non-GAAP Research and Development 20,989 23,931 25,183 28,272 98,375 30,131 31,952 34,475 36,589 133,147 40,648 40,529 42,025 159,791
Sales and Marketing 49,163 56,690 64,829 74,805 245,487 80,482 86,301 94,033 101,300 362,116 105,015 104,669 111,524 422,508
Share-based compensation (5,405) (6,122) (6,480) (6,146) (24,153) (7,608) (9,612) (9,267) (9,470) (35,957) (10,076) (13,938) (13,385) (46,869)
Employer payroll taxes on employee stock transactions (127) (578) (288) (637) (1,630) (585) (785) (511) (424) (2,305) (598) (300) (297) (1,619)
Amortization of other intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Non-GAAP Sales and Marketing 43,631 49,990 58,061 68,022 219,704 72,289 75,904 84,255 91,406 323,854 94,341 90,431 97,842 374,020
General and Administrative 21,527 22,110 23,442 25,140 92,219 26,922 31,689 32,643 35,368 126,622 36,321 40,074 36,242 148,005
Share-based compensation (3,351) (3,854) (3,783) (3,652) (14,640) (5,025) (7,022) (8,543) (8,810) (29,400) (7,444) (10,484) (6,777) (33,515)
Employer payroll taxes on employee stock transactions (7) (167) (34) (202) (410) (200) (254) (124) (123) (701) (211) (231) (68) (633)
Amortization of other intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other (1,559) (1,339) (500) 42 (3,356) 47 (1,249) (4) (78) (1,284) (79) (304) 3 (458)
Non-GAAP General and Administrative 16,610 16,750 19,125 21,328 73,813 21,744 23,164 23,972 26,357 95,237 28,587 29,055 29,400 113,399
Amortization of Other Intangibles 8,686 8,686 8,685 8,687 34,744 7,540 7,539 7,539 7,539 30,157 6,573 6,573 6,573 27,258
Share-based compensation - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Employer payroll taxes on employee stock transactions - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Amortization of other intangibles (8,686) (8,686) (8,685) (8,687) (34,744) (7,540) (7,539) (7,539) (7,539) (30,157) (6,573) (6,573) (6,573) (27,258)
Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Non-GAAP Amortization of Other Intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other (21) 46 (2) 17 40 26 (1) - 0 - 0 25 (10) - 0 (5) (15)
Share-based compensation - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Employer payroll taxes on employee stock transactions - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Amortization of other intangibles - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Restructuring & other 21 (46) 2 (17) (40) (26) 1 - 0 - 0 (25) 10 - 0 5 15
Non-GAAP Restructuring & other - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Operating income 24,106 22,831 24,107 20,852 91,896 21,212 21,251 21,215 17,629 81,307 19,094 20,399 33,887 91,009
Share-based compensation 12,672 14,831 15,588 14,693 57,784 19,252 25,575 27,123 27,586 99,536 28,695 40,654 35,504 132,439
Employer payroll taxes on employee stock transactions 285 1,696 692 1,441 4,114 1,727 1,991 1,277 949 5,944 1,642 1,040 808 4,439
Amortization of other intangibles 12,512 12,516 12,516 12,517 50,061 11,370 11,403 11,483 11,414 45,670 10,465 10,461 10,462 42,802
Restructuring & other 1,538 1,385 498 (25) 3,396 (21) 1,248 4 78 1,309 419 334 (8) 823
Non-GAAP Operating income 51,113 53,259 53,401 49,478 207,251 53,540 61,468 61,102 57,656 233,766 60,315 72,888 80,653 271,512
Net income 12,865 17,479 18,416 26,954 75,714 13,294 23,641 14,587 929 52,451 2,114 10,526 15,026 28,595
Income tax (benefit) expense 7,147 1,949 4,762 (11,719) 2,139 6,372 (6,340) 2,821 16,355 19,208 12,555 8,146 15,691 52,747
Cash (paid for) received from tax - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0 - 0
Non-GAAP effective cash tax (3,578) (3,786) (3,810) (3,546) (14,720) (6,140) (7,113) (7,093) (7,543) (27,889) (6,407) (7,967) (9,080) (30,997)
Interest expense, net 4,113 3,602 3,455 3,035 14,205 2,857 2,651 2,450 2,234 10,192 2,175 513 4,787 9,709
Cash paid for interest, net (3,763) (3,160) (2,991) (2,561) (12,475) (2,370) (2,190) (1,989) (1,826) (8,375) (2,066) (467) 1,896 (2,463)
Share-based compensation 12,672 14,831 15,588 14,693 57,784 19,252 25,575 27,123 27,586 99,536 28,695 40,654 35,504 132,439
Employer payroll taxes on employee stock transactions 285 1,696 692 1,441 4,114 1,727 1,991 1,277 949 5,944 1,642 1,040 808 4,439
Amortization of other intangibles 8,686 8,686 8,685 8,687 34,744 7,540 7,539 7,539 7,539 30,157 6,573 6,573 6,573 27,258
Amortization of acquired technology 3,826 3,830 3,831 3,830 15,317 3,830 3,864 3,944 3,875 15,513 3,892 3,888 3,889 15,544
Transaction, restructuring, and other 1,538 1,385 498 (25) 3,396 (21) 1,248 4 78 1,309 419 334 (8) 823
(Gain) loss on currency translation (19) (199) (2,526) 2,582 (162) (1,311) 1,299 1,357 (1,889) (544) 2,250 1,214 (1,617) (42)
Non-GAAP net income 43,772 46,313 46,600 43,371 180,056 45,030 52,165 52,020 48,287 197,502 51,842 64,454 73,469 238,052
Share count:
Weighted-average shares outstanding - basic 279,069 280,077 281,010 281,726 280,469 282,661 283,923 284,722 285,349 284,161 286,203 287,190 287,957
Weighted-average shares outstanding - diluted 284,309 286,252 286,427 288,067 286,509 288,988 291,177 291,845 290,339 290,903 290,024 290,601 291,228
Shares used in non-GAAP per share calculations:
Weighted-average shares outstanding - basic 279,069 280,077 281,010 281,726 280,469 282,661 283,923 284,722 285,349 284,161 286,203 287,190 287,957
Weighted-average shares outstanding - diluted 284,309 286,252 286,427 288,067 286,509 288,988 291,177 291,845 290,339 290,903 290,024 290,601 291,228
Net income per share:
Net income per share - basic 0.05 0.06 0.07 0.10 0.27 0.05 0.08 0.05 0.00 0.18 0.01 0.04 0.05
Net income per share - diluted 0.05 0.06 0.06 0.09 0.26 0.05 0.08 0.05 0.00 0.18 0.01 0.04 0.05
Non-GAAP net income per share - basic 0.16 0.17 0.17 0.15 0.64 0.16 0.18 0.18 0.17 0.70 0.18 0.22 0.26
Non-GAAP net income per share - diluted 0.15 0.16 0.16 0.15 0.63 0.16 0.18 0.18 0.17 0.68 0.18 0.22 0.25
(1)Prior periods have been updated from previously issued financial statements

&G

Free Cash Flow

Dynatrace, Inc.
FCF and uFCF (in thousands)
FY 2021 FY 2022 FY 2023
Q1(1) Q2(1) Q3(1) Q4 FY Q1(1) Q2(1) Q3 Q4 FY Q1 Q2 Q3 TTM
Free Cash Flow ("FCF")
Net cash provided by operating activities 37,008 23,841 73,716 85,871 220,436 83,472 18,296 60,844 88,305 250,917 143,098 29,398 61,962 322,763
Property and equipment (4,418) (1,982) (2,468) (5,208) (14,076) (2,954) (4,658) (4,156) (5,927) (17,695) (6,906) (4,331) (4,388) (21,552)
FCF 32,590 21,859 71,248 80,663 206,360 80,518 13,638 56,688 82,378 233,222 136,192 25,067 57,574 301,211
Unlevered Free Cash Flow ("uFCF")
Cash paid for interest expense 3,763 3,160 2,991 2,561 12,475 2,370 2,190 1,989 1,826 8,375
Discrete tax items 7,510 7,390 - 0 3,043 17,943 (1,183) (3,846) 1 (1,519) (6,547)
Transaction, restructuring, and other 1,538 1,385 498 (25) 3,396 (21) 248 1,004 78 1,309
Total uFCF 45,401 33,794 74,737 86,242 240,174 81,684 12,230 59,682 82,763 236,359
Interest tax adjustment (941) (790) (748) (640) (3,119) (593) (548) (496) (457) (2,094)
uFCF 44,460 33,004 73,989 85,602 237,055 81,091 11,682 59,186 82,306 234,265
(1)Prior periods have been updated from previously issued financial statements

&G

Total ARR

Dynatrace, Inc.
Total ARR Expansion Trend Tables
(in thousands)
FY 2021 FY 2022 FY 2023
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Year-over-Year
ARR (As Reported) 601,376 638,063 721,995 774,090 823,222 863,863 929,906 995,121 1,031,284 1,064,951 1,162,591
Year-over-Year increase 37% 35% 35% 35% 37% 35% 29% 29% 25% 23% 25%
TTM FX headwind/(tailwind)1 7,635 (9,419) (18,374) (19,025) (29,547) (7,717) 21,150 19,504 46,948 61,299 28,879
ARR - Constant Currency 609,011 628,644 703,621 755,065 793,675 856,146 951,056 1,014,625 1,078,232 1,126,250 1,191,470
Year-over-Year ARR Increase - Constant Currency2 39% 33% 32% 32% 32% 34% 32% 31% 31% 30% 28%
TTM Perpetual License Rolloff - Constant Currency3 4,486 6,828 7,753 18,429 23,638 25,298 33,513 26,824 23,298 21,349 11,157
Adjusted ARR 613,497 635,472 711,374 773,494 817,313 881,444 984,569 1,041,449 1,101,530 1,147,599 1,202,627
Adjusted ARR Growth4 39% 35% 33% 35% 36% 38% 36% 35% 34% 33% 29%
Quarter-over-Quarter Q1 Q2 Q3 Q4 FY 2021 Q1 Q2 Q3 Q4 FY 2022 Q1 Q2 Q3 TTM
ARR (As Reported) 601,376 638,063 721,995 774,090 823,222 863,863 929,906 995,121 1,031,284 1,064,951 1,162,591
Net New ARR (As Reported)5 28,617 36,684 83,935 52,095 201,331 49,132 40,641 66,043 65,215 221,031 36,163 33,667 97,640 232,685
Discontinuation of business in Russia 5,634 5,634 - 0 - 0 - 0 5,634
Quarterly FX headwind/(tailwind)6 1,134 (11,038) (11,971) 3,447 (18,428) (6,155) 9,769 14,911 862 19,387 18,841 24,462 (18,955) 25,210
Net New ARR - Constant Currency 29,751 25,646 71,964 55,542 182,903 42,977 50,410 80,954 71,711 246,052 55,004 58,129 78,685 263,529
Quarterly Perpetual License Rolloff - Constant Currency7 324 2,520 4,416 10,970 18,230 6,130 3,726 12,130 5,419 27,405 1,756 1,823 1,979 10,977
Net New ARR Excluding Perpetual Licence Rolloff - Constant Currency 30,075 28,166 76,380 66,512 201,133 49,107 54,136 93,084 77,130 273,457 56,760 59,952 80,664 274,506
Year-over-Year Net New ARR Growth ex-Perp -Constant Currency -17% -25% 17% 61% 11% 63% 92% 22% 16% 36% 16% 11% -13% 4%

Year-over-year FX headwind/(tailwind) using exchange rates from the same quarter in the prior year. Represents the year-over-year growth rate excluding the FX headwind/(tailwind). Represents the cumulative trailing-twelve-month amount of Dynatrace perpetual license ARR that had reached the end of its revenue recognition schedule. Defined as year-over-year growth in Adjusted ARR divided by ARR as reported. Defined as the quarterly increase/(decrease) in the current quarter as reported ARR compared to the previous quarter's as reported ARR. Quarterly FX impact using exchange rates from the prior quarter. Represents the quarterly amount of Dynatrace perpetual license ARR that had reached the end of its revenue recognition schedule in constant currency, net of new perpetual license ARR signed in the quarter.