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Press Release

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05/04/22 - 04:05 pm
Rapid7 Announces First Quarter 2022 Financial Results
  • Annualized recurring revenue (ARR) of $627 million, an increase of 38% year-over-year
  • Total revenue of $157 million, up 34% year-over-year; Products revenue of $149 million, up 36% year-over-year
  • Total customer growth of 16% year-over-year
  • Total ARR per customer growth of 18% year-over-year

BOSTON, May 04, 2022 (GLOBE NEWSWIRE) -- Rapid7, Inc. (Nasdaq: RPD), a leading provider of security analytics and automation, today announced its financial results for the first quarter of 2022.

“Rapid7’s strong start to the year was driven by on-going momentum across our security transformation and vulnerability management solutions, as we sustained year-over-year ARR growth of 38%,” said Corey Thomas, Chairman and CEO of Rapid7.

“Amid an escalating cyberthreat environment, we are seeing robust demand for our differentiated and best-in-suite security operations platform as customers work to secure their modern and traditional technology environments. Alongside our strong growth, we generated positive free cash flow in the first quarter as we focus on our commitment to scaling efficiently while investing in our people and technology to drive durable growth.”

First Quarter 2022 Financial Results and Other Metrics

  Three Months Ended March 31,
  2022   2021   % Change
  (dollars in thousands)
Annualized recurring revenue $ 627,122   $ 455,797   38 %
Number of customers   10,407     8,945   16 %
ARR per customer $ 60.3   $ 51.0   18 %


  Three Months Ended March 31,
  2022   2021   % Change
  (in thousands, except per share data)
Products revenue $ 149,025     $ 109,285     36 %
Professional services revenue   8,359       8,166     2 %
Total revenue $ 157,384     $ 117,451     34 %
           
North America revenue $ 124,934     $ 96,403     30 %
Rest of world revenue   32,450       21,048     54 %
Total revenue $ 157,384     $ 117,451     34 %
           
GAAP gross profit $ 106,095     $ 81,162      
GAAP gross margin   67 %     69 %    
Non-GAAP gross profit $ 113,029     $ 85,457      
Non-GAAP gross margin   72 %     73 %    
           
GAAP loss from operations $ (40,379 )   $ (23,116 )    
GAAP operating margin   (26 )%     (20 )%    
Non-GAAP (loss) income from operations $ (5,619 )   $ 1,906      
Non-GAAP operating margin   (4 )%     2 %    
           
GAAP net loss $ (44,999 )   $ (29,845 )    
GAAP net loss per share, basic and diluted $ (0.78 )   $ (0.56 )    
Non-GAAP net loss $ (9,260 )   $ (1,425 )    
Non-GAAP net loss per share, basic and diluted $ (0.16 )   $ (0.03 )    
           
Adjusted EBITDA $ (1,173 )   $ 5,757      
           
Net cash provided by operating activities $ 10,403     $ 20,595      
Free cash flow $ 3,828     $ 17,865      

For additional details on the reconciliation of non-GAAP measures and certain other business metrics to their nearest comparable GAAP measures, please refer to the accompanying financial data tables included in this press release.

Recent Business Highlights

  • In April 2022, Rapid7 published its 2022 Social Good Report, the company’s first comprehensive look at its work around advancing cybersecurity, diversity and inclusion, purposeful philanthropy, environmental sustainability, and governance.
  • In March 2022, Rapid7 was named a Strong Performer by The Forrester WaveTM for Cloud Workload Security, including recognition as the top-ranked solution in the Current Offering category. Rapid7 received the highest possible scores for Cloud Security Posture Management (CSPM), Infrastructure as Code (IaC) security, orchestration platform, runtime, Cloud Workload Protections (CWP), and container protection plans.
  • In March 2022, Rapid7 announced new cloud workload protection capabilities for InsightCloudSec, the company’s fully-integrated cloud-native security platform, including native vulnerability assessment enhancements for container and Kubernetes environments.
  • In March 2022, Rapid7 published the results of a MITRE Engenuity ATT&CK® Evaluation of Rapid7 InsightIDR, highlighting the strong signal-to-noise demonstrated by the company’s industry-leading cloud SIEM and XDR offering.
  • In March 2022, Rapid7 released its 2021 Vulnerability Intelligence Report, examining the 50 most notable security vulnerabilities and high-impact Cyber Attacks in 2021.

Second Quarter and Full-Year 2022 Guidance

Rapid7 anticipates annualized recurring revenue, revenue, non-GAAP income from operations, non-GAAP net (loss) income per share and free cash flow to be in the following ranges:

  Second Quarter 2022   Full-Year 2022
  (in millions, except per share data)
Annualized recurring revenue                 $740 to $750
Year-over-year growth                 24% to 25%
Revenue         $163 to $165   $686 to $692
Year-over-year growth         29% to 31%   28% to 29%
Non-GAAP income from operations         $0 to $2   $17 to $24
Non-GAAP net (loss) income per share         $(0.07) to $(0.03)   $0.05 to $0.16
Weighted average shares outstanding         58.8   60.9
Free cash flow                 $40 to $45

The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. Guidance for the second quarter and full-year 2022 does not include any potential impact of foreign exchange gains or losses. The weighted average shares outstanding for the second quarter 2022 represent basic shares outstanding given our projected non-GAAP net loss and for the full-year 2022 diluted shares outstanding given our projected range of non-GAAP net income. The guidance provided above is based on a number of assumptions, estimates and expectations as of the date of this press release and, while presented with numerical specificity, this guidance is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Rapid7's control and are based upon specific assumptions with respect to future business decisions or economic conditions, some of which may change. Rapid7 undertakes no obligation to update guidance after this date.

Non-GAAP guidance excludes estimates for stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs, and certain other items. Rapid7 has provided a reconciliation of each non-GAAP guidance measure to the most comparable GAAP measures in the financial statement tables included in this press release. The reconciliation does not reflect any items that are unknown at this time, such as litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty.

Conference Call and Webcast Information

Rapid7 will host a conference call today, May 4, 2022, to discuss its results at 4:30 p.m. Eastern Time. The call will be accessible by telephone at 877-357-4230 (domestic) or 629-228-0721 (international). The call will also be available live via webcast on Rapid7's website at https://investors.rapid7.com. A telephone replay of the conference call will be available at 855-859-2056 or 404-537-3406 (access code 8743849) until May 11, 2022. A webcast replay will be available at https://investors.rapid7.com.

About Rapid7

Rapid7 (Nasdaq: RPD) is advancing security with visibility, analytics, and automation delivered through our Insight cloud. Our solutions simplify the complex, allowing security teams to work more effectively with IT and development to reduce vulnerabilities, monitor for malicious behavior, investigate and shut down attacks, and automate routine tasks. Over 10,000 customers rely on Rapid7 technology, services, and research to improve security outcomes and securely advance their organizations. For more information, visit our website, check out our blog, or follow us on Twitter.

Non-GAAP Financial Measures and Other Metrics

To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States, or GAAP, we provide investors with certain non-GAAP financial measures and other metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We also use certain non-GAAP financial measures as performance measures under our executive bonus plan. We believe that these non-GAAP financial measures and other metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, you should review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate our business.

Non-GAAP Financial Measures

We disclose the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income (loss) from operations, non-GAAP net income (loss), non-GAAP net income (loss) per share, adjusted EBITDA and free cash flow. We also disclose non-GAAP gross margin and non-GAAP operating margin derived from these financial measures.

We define non-GAAP gross profit, non-GAAP income (loss) from operations, non-GAAP net income (loss) and non-GAAP net income (loss) per share as the respective GAAP balances excluding the effect of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs and certain other items such as acquisition-related expenses, litigation-related expenses and induced conversion expense. Non-GAAP net income (loss) per basic and diluted share is calculated as non-GAAP net income (loss) divided by the weighted average shares used to compute net income (loss) per share, with the number of weighted average shares decreased, when applicable, to reflect the anti-dilutive impact of the capped call transactions entered into in connection with our convertible senior notes.

We believe these non-GAAP financial measures are useful to investors in assessing our operating performance due to the following factors:

Stock-based compensation expense. We exclude stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact our non-cash expense. We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period.

Amortization of acquired intangible assets. We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.

Amortization of debt issuance costs. The expense for the amortization of debt issuance costs related to our convertible senior notes and revolving credit facility is a non-cash item, and we believe the exclusion of this interest expense provides a more useful comparison of our operational performance in different periods.

Induced conversion expense. In conjunction with the first quarter of 2021 partial repurchase of our 1.25% convertible senior notes due 2023, we incurred an induced conversion expense of $2.7 million. We exclude induced conversion expense because this amount is not indicative of the performance of, or trends in, our business and neither is comparable to the prior period nor predictive of future results.

Litigation-related expenses. We exclude certain litigation-related expenses consisting of professional fees and related costs incurred by us related to significant litigation outside the ordinary course of business. We believe it is useful to exclude such expenses because we do not consider such amounts to be part of our ongoing operations.

Acquisition-related expenses. We exclude acquisition-related expenses as costs that are unrelated to the current operations and neither are comparable to the prior period nor predictive of future results.

Anti-dilutive impact of capped call transaction. Our capped calls transactions are intended to offset potential dilution from the conversion features in our convertible senior notes. Although we cannot reflect the anti-dilutive impact of the capped call transactions under GAAP, we do reflect the anti-dilutive impact of the capped call transactions in non-GAAP net income (loss) per diluted share, when applicable, to provide investors with useful information in evaluating our financial performance on a per share basis.

Adjusted EBITDA (non-GAAP). Adjusted EBITDA is a non-GAAP measure that we define as net loss before (1) interest income, (2) interest expense, (3) other income (expense), net, (4) provision for income taxes, (5) depreciation expense, (6) amortization of intangible assets, (7) stock-based compensation expense, and (8) certain other items. We believe that the use of adjusted EBITDA is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods.  

Free Cash Flow. Free cash flow is a non-GAAP measure that we define as net cash provided by operating activities less purchases of property and equipment and capitalization of internal-use software costs.

Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact upon our reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in our business and an important part of the compensation provided to our employees.

Other Metrics

Annualized Recurring Revenue (ARR). ARR is defined as the annual value of all recurring revenue related contracts in place at the end of the period. ARR should be viewed independently of revenue and deferred revenue as ARR is an operating metric and is not intended to be combined with or replace these items. ARR is not a forecast of future revenue and can be impacted by contract start and end dates and renewal rates, and does not include revenue reported as perpetual license or professional services revenue in our consolidated statement of operations.

Number of Customers. We define a customer as any entity that has an active Rapid7 recurring revenue contract as of the specified measurement date, excluding InsightOps and Logentries only customers with a contract value less than $2,400 per year.

ARR per Customer. We define ARR per customer as ARR divided by the number of customers at the end of the period.

Cautionary Language Concerning Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the statements regarding our financial guidance for the second quarter and full-year 2022, the assumptions underlying such guidance and the timing of global economic recovery, market opportunities, future growth and operating leverage, and the anticipated impact of the ongoing COVID-19 pandemic on our guidance, business, financial condition, and results of operations. Our use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. The events described in our forward-looking statements are subject to a number of risks and uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Risks that could cause or contribute to such differences include, but are not limited to, risks arising from the ongoing COVID-19 pandemic, fluctuations in our quarterly results, failure to meet our publicly announced guidance or other expectations about our business, our rapid growth and ability to sustain our revenue growth rate, the ability of our products and professional services to correctly detect vulnerabilities, our customers renewal of their subscriptions with us, competition in the markets in which we operate, market growth, our ability to innovate and manage our growth, our sales cycles, our ability to integrate acquired companies, and our ability to operate in compliance with applicable laws as well as other risks and uncertainties set forth in the “Risk Factors” section of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 24, 2022 and in the subsequent reports that we file with the Securities and Exchange Commission. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed in any forward-looking statements we may make. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

Investor contact:

Sunil Shah
Vice President, Investor Relations
investors@rapid7.com
(617) 865-4277

Press contact:

Caitlin O'Connor
Senior Public Relations Manager
press@rapid7.com
(857) 990-4240


RAPID7, INC.    

Consolidated Balance Sheets (Unaudited)     
(in thousands)    

    March 31, 2022   December 31, 2021
Assets        
Current assets:        
Cash and cash equivalents   $ 141,365     $ 164,582  
Short-term investments     93,155       58,850  
Accounts receivable, net     107,320       146,094  
Deferred contract acquisition and fulfillment costs, current portion     30,984       29,974  
Prepaid expenses and other current assets     38,051       33,236  
Total current assets     410,875       432,736  
Long-term investments     28,295       34,068  
Property and equipment, net     49,804       50,225  
Operating lease right-of-use assets     89,196       83,751  
Deferred contract acquisition and fulfillment costs, non-current portion     59,121       57,191  
Goodwill     515,333       515,258  
Intangible assets, net     108,246       111,591  
Other assets     13,000       11,191  
Total assets   $ 1,273,870     $ 1,296,011  
Liabilities and Stockholders’ Equity (Deficit)        
Current liabilities:        
Accounts payable   $ 12,163     $ 3,521  
Accrued expenses     56,502       82,620  
Operating lease liabilities, current portion     11,336       9,630  
Deferred revenue, current portion     378,338       372,067  
Other current liabilities     1,264       842  
Total current liabilities     459,603       468,680  
Convertible senior notes, non-current portion, net     812,995       812,063  
Operating lease liabilities, non-current portion     93,954       90,865  
Deferred revenue, non-current portion     30,616       33,056  
Other long-term liabilities     13,253       17,342  
Total liabilities     1,410,421       1,422,006  
Stockholders’ equity (deficit):        
Common stock     582       577  
Treasury stock     (4,764 )     (4,764 )
Additional paid-in-capital     650,710       615,032  
Accumulated other comprehensive loss     (2,052 )     (812 )
Accumulated deficit     (781,027 )     (736,028 )
Total stockholders’ equity (deficit)     (136,551 )     (125,995 )
Total liabilities and stockholders’ equity (deficit)   $ 1,273,870     $ 1,296,011  


RAPID7, INC.

Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share data)

  Three Months Ended March 31,
  2022   2021
Revenue:      
Products $ 149,025     $ 109,285  
Professional services   8,359       8,166  
Total revenue   157,384       117,451  
Cost of revenue:      
Products   43,472       29,650  
Professional services   7,817       6,639  
Total cost of revenue   51,289       36,289  
Total gross profit   106,095       81,162  
Operating expenses:      
Research and development   49,812       33,080  
Sales and marketing   75,146       54,978  
General and administrative   21,516       16,220  
Total operating expenses   146,474       104,278  
Loss from operations   (40,379 )     (23,116 )
Other income (expense), net:      
Interest income   112       96  
Interest expense   (2,693 )     (5,394 )
Other income (expense), net   (603 )     (1,068 )
Loss before income taxes   (43,563 )     (29,482 )
Provision for income taxes   1,436       363  
Net loss $ (44,999 )   $ (29,845 )
Net loss per share, basic and diluted $ (0.78 )   $ (0.56 )
Weighted-average common shares outstanding, basic and diluted   57,724,821       52,904,881  


RAPID7, INC.

Consolidated Statements of Cash Flows (Unaudited)
(in thousands)

  Three Months Ended March 31,
  2022   2021
Cash flows from operating activities:      
Net loss $ (44,999 )   $ (29,845 )
Adjustments to reconcile net loss to cash provided by operating activities:      
Depreciation and amortization   10,169       6,740  
Amortization of debt issuance costs   979       658  
Stock-based compensation expense   28,922       20,862  
Induced conversion expense         2,740  
Other   526       1,404  
Change in operating assets and liabilities:      
Accounts receivable   36,327       34,414  
Deferred contract acquisition and fulfillment costs   (2,939 )     (1,956 )
Prepaid expenses and other assets   (6,556 )     (136 )
Accounts payable   8,673       550  
Accrued expenses   (24,048 )     (15,429 )
Deferred revenue   3,830       987  
Other liabilities   (481 )     (394 )
Net cash provided by operating activities   10,403       20,595  
Cash flows from investing activities:      
Business acquisition, net of cash acquired         (49,720 )
Purchases of property and equipment   (3,053 )     (972 )
Capitalization of internal-use software costs   (3,522 )     (1,758 )
Purchases of investments   (32,136 )     (6,394 )
Sales/maturities of investments   2,800       41,900  
Other investments         (1,500 )
Net cash used in investing activities   (35,911 )     (18,444 )
Cash flows from financing activities:      
Proceeds from issuance of convertible senior notes, net of issuance costs paid         587,100  
Purchase of capped calls related to convertible senior notes         (76,020 )
Payments for repurchase of convertible senior notes         (182,647 )
Payments related to business acquisitions         (2,431 )
Taxes paid related to net share settlement of equity awards   (3,461 )     (3,324 )
Proceeds from employee stock purchase plan   5,710       4,467  
Proceeds from stock option exercises   959       1,427  
Net cash provided by financing activities   3,208       328,572  
Effects of exchange rates on cash, cash equivalents and restricted cash   (800 )     (500 )
Net (decrease) increase in cash, cash equivalents and restricted cash   (23,100 )     330,223  
Cash, cash equivalents and restricted cash, beginning of period   165,017       173,617  
Cash, cash equivalents and restricted cash, end of period $ 141,917     $ 503,840  


RAPID7, INC.    

GAAP to Non-GAAP Reconciliation (Unaudited)    
(in thousands, except share and per share data)   

  Three Months Ended March 31,  
  2022   2021  
GAAP gross profit $ 106,095     $ 81,162    
Add: Stock-based compensation expense1   2,090       1,554    
Add: Amortization of acquired intangible assets2   4,844       2,741    
Non-GAAP gross profit $ 113,029     $ 85,457    
Non-GAAP gross margin   71.8 %     72.8 %  
         
GAAP gross profit - Products $ 105,553     $ 79,635    
Add: Stock-based compensation expense   1,495       1,018    
Add: Amortization of acquired intangible assets   4,844       2,741    
Non-GAAP gross profit - Products $ 111,892     $ 83,394    
Non-GAAP gross margin - Products   75.1 %     76.3 %  
         
GAAP gross profit - Professional services $ 542     $ 1,527    
Add: Stock-based compensation expense   595       536    
Non-GAAP gross profit - Professional services $ 1,137     $ 2,063    
Non-GAAP gross margin - Professional services   13.6 %     25.3 %  
         
GAAP loss from operations $ (40,379 )   $ (23,116 )  
Add: Stock-based compensation expense1   28,922       20,862    
Add: Amortization of acquired intangible assets2   5,723       2,889    
Add: Acquisition-related expenses3         1,168    
Add: Litigation-related expenses4   115       103    
Non-GAAP (loss) income from operations $ (5,619 )   $ 1,906    
         
GAAP net loss $ (44,999 )   $ (29,845 )  
Add: Stock-based compensation expense1   28,922       20,862    
Add: Amortization of acquired intangible assets2   5,723       2,889    
Add: Acquisition-related expenses3         1,168    
Add: Litigation-related expenses4   115       103    
Add: Amortization of debt issuance costs   979       658    
Add: Induced conversion expense         2,740    
Non-GAAP net loss $ (9,260 )   $ (1,425 )  
         
Reconciliation of net loss per share, basic and diluted        
GAAP net loss per share, basic and diluted $ (0.78 )   $ (0.56 )  
Non-GAAP adjustments to net loss   0.62       0.53    
Non-GAAP net loss per share, basic and diluted $ (0.16 )   $ (0.03 )  
         
Weighted average shares used in GAAP per share calculation, basic and diluted   57,724,821       52,904,881    
         
1 Includes stock-based compensation expense as follows:        
Cost of revenue $ 2,090     $ 1,554    
Research and development   13,024       7,815    
Sales and marketing   6,774       5,746    
General and administrative   7,034       5,747    
         
2 Includes amortization of acquired intangible assets as follows:        
Cost of revenue $ 4,844     $ 2,741    
Sales and marketing   684       103    
General and administrative   195       45    
         
3 Includes acquisition-related expenses as follows:        
Sales and marketing         122    
General and administrative         1,046    
         
4 Includes litigation-related expenses as follows:        
General and administrative $ 115     $ 103    


RAPID7, INC.

Reconciliation of Net Loss to Adjusted EBITDA (Unaudited)
(in thousands)

  Three Months Ended March 31,
  2022   2021
GAAP net loss $ (44,999 )   $ (29,845 )
Interest income   (112 )     (96 )
Interest expense   2,693       5,394  
Other (income) expense, net   603       1,068  
Provision for income taxes   1,436       363  
Depreciation expense   3,303       2,994  
Amortization of intangible assets   6,866       3,746  
Stock-based compensation expense   28,922       20,862  
Acquisition-related expenses         1,168  
Litigation-related expenses   115       103  
Adjusted EBITDA $ (1,173 )   $ 5,757  


RAPID7, INC.

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited)
(in thousands)

  Three Months Ended March 31,
  2022   2021
Net cash provided by operating activities $ 10,403     $ 20,595  
Less: Purchases of property and equipment   (3,053 )     (972 )
Less: Capitalized internal-use software costs   (3,522 )     (1,758 )
Free cash flow $ 3,828     $ 17,865  


Second Quarter and Full-Year 2022 Guidance

GAAP to Non-GAAP Reconciliation    
(in millions, except per share data)

  Second Quarter 2022   Full-Year 2022
Reconciliation of GAAP to non-GAAP income from operations:              
Anticipated GAAP loss from operations $ (39 ) to $ (37 )   $ (136 ) to $ (129 )
Add: Anticipated stock-based compensation expense   33   to   33       131   to   131  
Add: Anticipated amortization of acquired intangible assets   6   to   6       22   to   22  
Anticipated non-GAAP income from operations $ 0     $ 2     $ 17     $ 24  
               
Reconciliation of GAAP to non-GAAP net (loss) income:              
Anticipated GAAP net loss $ (44 ) to $ (42 )   $ (154 ) to $ (147 )
Add: Anticipated stock-based compensation expense   33   to   33       131   to   131  
Add: Anticipated amortization of acquired intangible assets   6   to   6       22   to   22  
Add: Anticipated amortization of debt issuance costs   1   to   1       4   to   4  
Anticipated non-GAAP net (loss) income $ (4 )   $ (2 )   $ 3     $ 10  
               
Anticipated GAAP net loss per share, basic and diluted $ (0.75 )   $ (0.71 )   $ (2.61 )   $ (2.50 )
Anticipated non-GAAP net (loss) income per share, basic and diluted $ (0.07 )   $ (0.03 )   $ 0.05     $ 0.16  
               
Weighted average shares used in GAAP per share calculation, basic and diluted   58.8       58.9  
               
Weighted average shares used in non-GAAP per share calculation              
Basic   58.8       58.9  
Diluted   58.8       60.9  

The reconciliation does not reflect any items that are unknown at this time, such as litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty. As a result, the estimates shown for Anticipated GAAP loss from operations, Anticipated GAAP net loss and Anticipated GAAP net loss per share are expected to change.

  Full-Year 2022
Reconciliation of net cash provided by operating activities to free cash flow:      
Net cash provided by operating activities $ 80   to $ 85  
Purchases of property and equipment   (25 ) to   (25 )
Capitalized internal-use software costs   (15 ) to   (15 )
Free cash flow $ 40     $ 45  

 


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Source: Rapid7