Active Stock Momentum: FireEye, Inc. (NASDAQ: FEYE)

On Wednesday, shares of FireEye, Inc. (NASDAQ: FEYE) oscillated between $16.75 and $18.02 before concluding trading period lower/higher -5.41% or 16.79 at $-0.96. The stock recorded total trading quantity of 4,831,068 shares as compared to its ninety days average volume of 4,507,696 shares.  In the trailing 12 months period, return on assets ratio of the Company was -12.00% and return on equity ratio was -44.00% while its return on investment ratio was -18.60%.

FireEye, Inc. (FEYE), the intelligence-led security company, recently reported financial results for the second quarter ended June 30, 2018.

“Sales growth in the second quarter was broad based across all geographies and product families, and demand for our differentiated security products and services is increasing as we enter the second half of 2018,” stated Kevin Mandia, FireEye chief executive officer. “New logo consumers added in the quarter raised year-over-year and sequentially for the first time since early 2016, and we added over 75 new Helix consumers in the second quarter.”

Second Quarter 2018 Financial Results

• Revenue of $203M raised 6 percent from the second quarter of 2017 and was at the high end of the guidance range of $199M to $203M.
• Billings of $196M raised 13 percent from the second quarter of 2017 and was above the guidance range of $180M to $195M.¹
• GAAP gross margin was 67 percent of revenue, contrast to 65 percent of revenue in the second quarter of 2017.
• Non-GAAP gross margin was 75 percent of revenue, contrast to 74 percent of revenue in the second quarter of 2017, and was above the guidance of about 74 percent of revenue.¹
• GAAP operating margin was negative 24 percent of revenue, contrast to negative 30 percent of revenue in the second quarter of 2017.
• Non-GAAP operating margin was 2 percent of revenue, contrast to negative 1 percent of revenue in the second quarter of 2017, and was above the guidance range of negative 2 percent to positive 1 percent of revenue.¹
• GAAP net loss per share was $0.38, contrast to a GAAP net loss per share of $0.39 in the second quarter of 2017.
• Non-GAAP net income per share was $0.00, contrast to a non-GAAP net loss per share of $0.03 in the second quarter of 2017, and was at the high end of the guidance range for non-GAAP net income (loss) per share of $(0.03) to $0.00.¹
• Cash flow generated by operations was negative $44.3M, contrast to cash flow generated by operations of negative $11.5M in the second quarter of 2017. Cash flow generated by operations for the second quarter of 2018 included $43.6M that was deemed to be a repayment of accreted debt discount on $340M principal amount of the 1.000% Convertible Senior Notes due 2035 (“Series A Notes”), which were repurchased and stepped down on May 24, 2018.
• Non-GAAP cash flow generated by operations, which excludes the deemed repayment of accreted debt discount associated with the repurchased Series A Notes, was negative $0.7M, and was at the high end of the guidance range of negative $15M to break-even.¹

Third Quarter and Updated 2018 Outlook

FireEye provides guidance based on current market conditions and expectations.

For the third quarter of 2018, FireEye presently expects:

• Total revenue in the range of $206M to $210M.
• Billings in the range of $210M to $220M.
• Non-GAAP gross margin as a percent of revenue of about 75 percent.
• Non-GAAP operating margin as a percent of revenue in the range of 2.5 percent to 3.5 percent.
• Non-GAAP net income per share of $0.01 to $0.03.
• Cash flow generated by operations between $10M and $20M.

Non-GAAP net income per share for the third quarter assumes cash interest expense of about $3.5M associated with the company’s convertible senior notes, provision for income taxes of between $1.0M and $1.5M, and diluted weighted average shares outstanding of about 201M.

For 2018, FireEye presently expects:

• Revenue in the range of $820M to $830M.
• Billings in the range of $825M to $845M.
• Non-GAAP operating margin as a percent of revenue between 1 percent and 2 percent.
• Non-GAAP net income per share between $0.00 and $0.04.
• Non-GAAP cash flow generated by operations of $55M to $65M. Guidance for non-GAAP cash flow generated by operations excludes $43.6M that was deemed to be a repayment of accreted debt discount on $340M principal amount of Series A Notes, which were repurchased and stepped down on May 24, 2018.
• Capital expenditures between $40M and $45M.

Beta factor, which measures the riskiness of the security, was registered at 0.38. In the profitability analysis, net profit margin of the firm was recorded at -37.10% and operating profit margin was calculated at -29.80% while gross profit margin was measured as 65.60%.  FireEye, Inc. provides cybersecurity solutions that allow organizations to prepare for, prevent, respond to, and remediate cyber-attacks.