Company Quick10K Filing
Verint Systems
Price42.97 EPS1
Shares67 P/E51
MCap2,898 P/FCF22
Net Debt345 EBIT94
TEV3,244 TEV/EBIT35
TTM 2019-10-31, in MM, except price, ratios
10-Q 2020-04-30 Filed 2020-06-09
10-K 2020-01-31 Filed 2020-03-31
10-Q 2019-10-31 Filed 2019-12-04
10-Q 2019-07-31 Filed 2019-09-04
10-Q 2019-04-30 Filed 2019-06-06
10-K 2019-01-31 Filed 2019-03-28
10-Q 2018-10-31 Filed 2018-12-06
10-Q 2018-07-31 Filed 2018-09-05
10-Q 2018-04-30 Filed 2018-06-07
10-K 2018-01-31 Filed 2018-03-29
10-Q 2017-10-31 Filed 2017-12-06
10-Q 2017-07-31 Filed 2017-09-06
10-Q 2017-04-30 Filed 2017-06-08
10-K 2017-01-31 Filed 2017-03-28
10-Q 2016-10-31 Filed 2016-12-07
10-Q 2016-07-31 Filed 2016-09-07
10-Q 2016-04-30 Filed 2016-06-07
10-K 2016-01-31 Filed 2016-03-30
10-Q 2015-10-31 Filed 2015-12-02
10-Q 2015-07-31 Filed 2015-09-02
10-Q 2015-04-30 Filed 2015-06-03
10-K 2015-01-31 Filed 2015-03-27
10-Q 2014-10-31 Filed 2014-12-03
10-Q 2014-07-31 Filed 2014-09-04
10-Q 2014-04-30 Filed 2014-06-05
10-K 2014-01-31 Filed 2014-03-31
10-Q 2013-10-31 Filed 2013-12-04
10-Q 2013-04-30 Filed 2013-06-03
10-K 2013-01-31 Filed 2013-03-28
10-Q 2012-10-31 Filed 2012-12-06
10-Q 2012-07-31 Filed 2012-09-06
10-Q 2012-04-30 Filed 2012-06-06
10-K 2012-01-31 Filed 2012-04-02
10-Q 2011-10-31 Filed 2011-12-09
10-Q 2011-07-31 Filed 2011-09-08
10-Q 2011-04-30 Filed 2011-06-08
10-K 2011-01-31 Filed 2011-04-06
10-Q 2010-10-31 Filed 2010-12-10
10-Q 2010-07-31 Filed 2010-09-08
10-Q 2010-04-30 Filed 2010-06-09
10-K 2010-01-31 Filed 2010-05-19
10-Q 2009-10-31 Filed 2010-06-18
10-Q 2009-07-31 Filed 2010-06-18
10-Q 2009-04-30 Filed 2010-06-18
10-K 2009-01-31 Filed 2010-04-08
10-K 2008-01-31 Filed 2010-03-17
8-K 2020-06-18
8-K 2020-06-09
8-K 2020-06-08
8-K 2020-06-01
8-K 2020-05-07
8-K 2020-03-31
8-K 2020-03-19
8-K 2020-03-18
8-K 2019-12-04
8-K 2019-12-02
8-K 2019-11-25
8-K 2019-09-19
8-K 2019-09-04
8-K 2019-08-28
8-K 2019-07-08
8-K 2019-06-20
8-K 2019-06-06
8-K 2019-05-29
8-K 2019-05-23
8-K 2019-05-21
8-K 2019-05-20
8-K 2019-05-10
8-K 2019-05-06
8-K 2019-04-01
8-K 2019-03-27
8-K 2019-03-20
8-K 2019-01-07
8-K 2018-12-21
8-K 2018-12-17
8-K 2018-12-06
8-K 2018-12-06
8-K 2018-12-03
8-K 2018-11-27
8-K 2018-09-17
8-K 2018-09-05
8-K 2018-08-29
8-K 2018-08-28
8-K 2018-06-22
8-K 2018-06-13
8-K 2018-06-07
8-K 2018-06-04
8-K 2018-05-14
8-K 2018-03-28
8-K 2018-03-21
8-K 2018-01-31
8-K 2018-01-19

VRNT 10Q Quarterly Report

Part I
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 vrnt-ex31120200430xfor.htm
EX-31.2 vrnt-ex31220200430xfor.htm
EX-32.1 vrnt-ex32120200430xfor.htm
EX-32.2 vrnt-ex32220200430xfor.htm

Verint Systems Earnings 2020-04-30

Balance SheetIncome StatementCash Flow
3.02.41.81.20.60.02012201420172020
Assets, Equity
0.40.30.20.10.0-0.12012201420172020
Rev, G Profit, Net Income
0.40.2-0.0-0.3-0.5-0.72012201420172020
Ops, Inv, Fin

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
FORM 10-Q 
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended April 30, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from                                to                                     .
 
Commission File No. 001-34807

vrnt-20200430_g1.jpg
Verint Systems Inc
(Exact Name of Registrant as Specified in its Charter) 
Delaware 11-3200514
(State or Other Jurisdiction of Incorporation or
Organization)
 (I.R.S. Employer Identification No.)
175 Broadhollow Road 
Melville,New York11747
(Address of Principal Executive Offices) (Zip Code)

(631)962-9600
(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
The NASDAQ Stock Market, LLC
Common Stock, $.001 par value per shareVRNT(NASDAQ Global Select Market)
 
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
No ☐
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes
No ☐
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes No ☑
 
There were 64,525,660 shares of the registrant’s common stock outstanding on May 15, 2020.



Table of Contents

Verint Systems Inc. and Subsidiaries
Index to Form 10-Q
As of and For the Period Ended April 30, 2020
Page
 
  
 
 
 
 
 
 
  
  
  
 
 
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Cautionary Note on Forward-Looking Statements
 
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, the provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include financial projections, statements of plans and objectives for future operations, statements of future economic performance, and statements of assumptions relating thereto. Forward-looking statements may appear throughout this report, including without limitation, Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and are often identified by future or conditional words such as “will”, “plans”, “expects”, “intends”, “believes”, “seeks”, “estimates”, or “anticipates”, or by variations of such words or by similar expressions. There can be no assurance that forward-looking statements will be achieved. By their very nature, forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other important factors that could cause our actual results or conditions to differ materially from those expressed or implied by such forward-looking statements. Important risks, uncertainties, assumptions, and other factors that could cause our actual results or conditions to differ materially from our forward-looking statements include, among others:
 
uncertainties regarding the impact of changes in macroeconomic and/or global conditions, including as a result of slowdowns, recessions, economic instability, political unrest, armed conflicts, natural disasters, or outbreaks of disease, such as the COVID-19 pandemic, as well as the resulting impact on information technology spending and government budgets, on our business;
risks that our customers delay, cancel, or refrain from placing orders, refrain from renewing subscriptions or service contracts, or are unable to honor contractual commitments or payment obligations due to liquidity issues or other challenges in their business, due to the COVID-19 pandemic or otherwise;
risks that continuing restrictions resulting from the COVID-19 pandemic or actions taken in response to the pandemic adversely impact our operations or our ability to fulfill orders, complete implementations, or recognize revenue;
risks associated with our ability to keep pace with technological advances and challenges and evolving industry standards; to adapt to changing market potential from area to area within our markets; and to successfully develop, launch, and drive demand for new, innovative, high-quality products that meet or exceed customer needs, while simultaneously preserving our legacy businesses and migrating away from areas of commoditization;
risks due to aggressive competition in all of our markets, including with respect to maintaining revenue, margins, and sufficient levels of investment in our business and operations;
risks created by the continued consolidation of our competitors or the introduction of large competitors in our markets with greater resources than we have;
risks associated with our ability to successfully compete for, consummate, and implement mergers and acquisitions, including risks associated with valuations, reputational considerations, capital constraints, costs and expenses, maintaining profitability levels, expansion into new areas, management distraction, post-acquisition integration activities, and potential asset impairments;
risks relating to our ability to properly manage investments in our business and operations, execute on growth initiatives, and enhance our existing operations and infrastructure, including the proper prioritization and allocation of limited financial and other resources;
risks associated with our ability to retain, recruit, and train qualified personnel in regions in which we operate, including in new markets and growth areas we may enter;
risks that we may be unable to establish and maintain relationships with key resellers, partners, and systems integrators and risks associated with our reliance on third-party suppliers, partners, or original equipment manufacturers (“OEMs”) for certain components, products, or services, including companies that may compete with us or work with our competitors;
risks associated with the mishandling or perceived mishandling of sensitive or confidential information, including information that may belong to our customers or other third parties, and with security vulnerabilities or lapses, including cyber-attacks, information technology system breaches, failures, or disruptions;
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risks that our products or services, or those of third-party suppliers, partners, or OEMs which we use in or with our offerings or otherwise rely on, including third-party hosting platforms, may contain defects, develop operational problems, or be vulnerable to cyber-attacks;
risks associated with our significant international operations, including, among others, in Israel, Europe, and Asia, exposure to regions subject to political or economic instability, fluctuations in foreign exchange rates, and challenges associated with a significant portion of our cash being held overseas;
risks associated with political factors related to our business or operations, including reputational risks associated with our security solutions and our ability to maintain security clearances where required, as well as risks associated with a significant amount of our business coming from domestic and foreign government customers;
risks associated with complex and changing local and foreign regulatory environments in the jurisdictions in which we operate, including, among others, with respect to trade compliance, anti-corruption, information security, data privacy and protection, tax, labor, government contracts, relating to our own operations as well as to the use of our solutions by our customers;
challenges associated with selling sophisticated solutions, including with respect to assisting customers in understanding and realizing the benefits of our solutions, and developing, offering, implementing, and maintaining a broad and sophisticated solution portfolio;
challenges associated with pursuing larger sales opportunities, including with respect to longer sales cycles, transaction reductions, deferrals, or cancellations during the sales cycle; risk of customer concentration; challenges associated with our ability to accurately forecast when a sales opportunity will convert to an order, or to accurately forecast revenue and expenses;
challenges associated with our Customer Engagement segment cloud transition and our Cyber Intelligence segment software model transition, and risk of increased volatility of our operating results from period to period;
risks that our intellectual property rights may not be adequate to protect our business or assets or that others may make claims on our intellectual property, claim infringement on their intellectual property rights, or claim a violation of their license rights, including relative to free or open source components we may use;
risks that we may experience liquidity or working capital issues and related risks that financing sources may be unavailable to us on reasonable terms or at all;
risks associated with significant leverage resulting from our current debt position or our ability to incur additional debt, including with respect to liquidity considerations, covenant limitations and compliance, fluctuations in interest rates, dilution considerations (with respect to our convertible notes), and our ability to maintain our credit ratings;
risks arising as a result of contingent or other obligations or liabilities assumed in our acquisition of our former parent company, Comverse Technology, Inc. (“CTI”), or associated with formerly being consolidated with, and part of a consolidated tax group with, CTI, or as a result of the successor to CTI’s business operations, Mavenir Inc. (“Mavenir”), being unwilling or unable to provide us with certain indemnities to which we are entitled;
risks relating to the adequacy of our existing infrastructure, systems, processes, policies, procedures, internal controls, and personnel, and our ability to successfully implement and maintain enhancements to the foregoing, for our current and future operations and reporting needs, including related risks of financial statement omissions, misstatements, restatements, or filing delays;
risks associated with changing accounting principles or standards, tax laws and regulations, tax rates, and the continuing availability of expected tax benefits;
risks associated with market volatility in the prices of our common stock and convertible notes based on our performance, third-party publications or speculation, or other factors and risks associated with actions of activist stockholders;
risks associated with the issuance of preferred stock to an affiliate of Apax Partners, including with respect to completion of the second tranche of the investment and Apax's significant ownership position and potential that its interests will not be aligned with those of our common stockholders; and
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risks associated with the planned spin-off of our Cyber Intelligence Solutions business, including the possibility that the spin-off transaction may not be completed in the expected timeframe or at all, that it does not achieve the benefits anticipated, or that it negatively impacts our operations or stock price, including as a result of management distraction from our business.
These risks, uncertainties, assumptions, and challenges, as well as other factors, are discussed in greater detail in “Risk Factors” under Item 1A of our Annual Report on Form 10-K for the year ended January 31, 2020. You are cautioned not to place undue reliance on forward-looking statements, which reflect our management’s view only as of the date of this report. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances after the date any such statement is made, except as otherwise required under the federal securities laws. If we were in any particular instance to update or correct a forward-looking statement, investors and others should not conclude that we would make additional updates or corrections thereafter except as otherwise required under the federal securities laws.

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Part I

Item 1.   Financial Statements



VERINT SYSTEMS INC. AND SUBSIDIARIES
Index to Condensed Consolidated Financial Statements (Unaudited)
Page


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VERINT SYSTEMS INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
April 30,January 31,
(in thousands, except share and per share data)20202020
Assets  
Current Assets:  
Cash and cash equivalents$556,671  $379,146  
Restricted cash and cash equivalents, and restricted bank time deposits46,451  43,860  
Short-term investments19,741  20,215  
Accounts receivable, net of allowance for doubtful accounts of $6.3 million and $5.3 million, respectively
308,304  382,435  
Contract assets, net62,249  64,961  
Inventories25,030  20,495  
Prepaid expenses and other current assets92,168  87,946  
  Total current assets1,110,614  999,058  
Property and equipment, net115,481  116,111  
Operating lease right-of-use assets97,878  102,149  
Goodwill1,452,434  1,469,211  
Intangible assets, net182,503  197,764  
Other assets135,798  131,765  
  Total assets$3,094,708  $3,016,058  
Liabilities and Stockholders' Equity  
Current Liabilities:  
Accounts payable$70,987  $71,604  
Accrued expenses and other current liabilities228,256  233,948  
Contract liabilities378,548  397,350  
  Total current liabilities677,791  702,902  
Long-term debt990,390  832,798  
Long-term contract liabilities40,566  40,565  
Operating lease liabilities87,340  90,372  
Other liabilities105,715  106,984  
  Total liabilities1,901,802  1,773,621  
Commitments and Contingencies
Stockholders' Equity:  
Preferred stock - $0.001 par value; authorized 2,207,000 shares at April 30, 2020 and January 31, 2020, respectively; none issued.
    
Common stock - $0.001 par value; authorized 120,000,000 shares. Issued 68,930,000 and 68,529,000 shares; outstanding 64,526,000 and 64,738,000 shares at April 30, 2020 and January 31, 2020, respectively.
69  68  
Additional paid-in capital1,677,775  1,660,889  
Treasury stock, at cost - 4,404,000 and 3,791,000 shares at April 30, 2020 and January 31, 2020, respectively.
(208,124) (174,134) 
Accumulated deficit(112,544) (105,590) 
Accumulated other comprehensive loss(178,774) (151,865) 
Total Verint Systems Inc. stockholders' equity1,178,402  1,229,368  
Noncontrolling interests14,504  13,069  
  Total stockholders' equity1,192,906  1,242,437  
  Total liabilities and stockholders' equity$3,094,708  $3,016,058  

See notes to condensed consolidated financial statements.
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Table of Contents
VERINT SYSTEMS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
 Three Months Ended
April 30,
(in thousands, except per share data)20202019
Revenue:  
Product$77,284  $104,224  
Service and support210,011  211,035  
  Total revenue287,295  315,259  
Cost of revenue:  
Product21,318  28,120  
Service and support76,399  79,361  
Amortization of acquired technology4,609  6,707  
  Total cost of revenue102,326  114,188  
Gross profit184,969  201,071  
Operating expenses:  
Research and development, net59,079  57,169  
Selling, general and administrative111,651  121,721  
Amortization of other acquired intangible assets8,065  7,713  
  Total operating expenses178,795  186,603  
Operating income6,174  14,468  
Other income (expense), net:  
Interest income1,017  1,426  
Interest expense(10,698) (9,934) 
Other expense, net(2,230) (790) 
  Total other expense, net(11,911) (9,298) 
(Loss) income before (benefit) provision for income taxes(5,737) 5,170  
(Benefit) provision for income taxes(1,762) 1,409  
Net (loss) income(3,975) 3,761  
Net income attributable to noncontrolling interests2,039  2,185  
Net (loss) income attributable to Verint Systems Inc.$(6,014) $1,576  
Net (loss) income per common share attributable to Verint Systems Inc.:  
Basic$(0.09) $0.02  
Diluted$(0.09) $0.02  
Weighted-average common shares outstanding:  
Basic64,376  65,438  
Diluted64,376  67,088  
 
See notes to condensed consolidated financial statements.




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VERINT SYSTEMS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Loss
(Unaudited) 
 Three Months Ended
April 30,
(in thousands)20202019
Net (loss) income$(3,975) $3,761  
Other comprehensive loss, net of reclassification adjustments:  
Foreign currency translation adjustments(20,999) (3,962) 
Net (decrease) increase from foreign exchange contracts designated as hedges(873) 1,281  
Net decrease from interest rate swap designated as a hedge(6,944) (2,017) 
Benefit from income taxes on net increase (decrease) from foreign exchange contracts and interest rate swap designated as hedges1,548  294  
Other comprehensive loss(27,268) (4,404) 
Comprehensive loss(31,243) (643) 
Comprehensive income attributable to noncontrolling interests1,680  2,079  
Comprehensive loss attributable to Verint Systems Inc.$(32,923) $(2,722) 
 
See notes to condensed consolidated financial statements.
4


VERINT SYSTEMS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Stockholders’ Equity
(Unaudited)

 Verint Systems Inc. Stockholders’ Equity  
 Common StockAdditional Paid-in Capital  
Accumulated Other Comprehensive Loss
Total Verint Systems Inc. Stockholders’ Equity Total Stockholders’ Equity
(in thousands) SharesPar
Value
Treasury
Stock
Accumulated
Deficit
Non-controlling
Interests
Balances as of January 31, 201965,333  $67  $1,586,266  $(57,598) $(134,274) $(145,225) $1,249,236  $11,568  $1,260,804  
Net income  —        1,576    1,576  2,185  3,761  
Other comprehensive loss  —          (4,298) (4,298) (106) (4,404) 
Stock-based compensation - equity-classified awards  —    14,890        14,890    14,890  
Common stock issued for stock awards and stock bonuses  448                  
Treasury stock acquired  (8)     (474)     (474)   (474) 
Balances as of April 30, 201965,773  $67  $1,601,156  $(58,072) $(132,698) $(149,523) $1,260,930  $13,647  $1,274,577  
Balances as of January 31, 202064,738  $68  $1,660,889  $(174,134) $(105,590) $(151,865) $1,229,368  $13,069  $1,242,437  
Net (loss) income —        (6,014)   (6,014) 2,039  (3,975) 
Other comprehensive loss  —          (26,909) (26,909) (359) (27,268) 
Stock-based compensation - equity-classified awards  —    15,029        15,029    15,029  
Common stock issued, or to be issued, for stock awards and stock bonuses  399  1  1,845        1,846    1,846  
Exercises of stock options  2    12        12    12  
Treasury stock acquired  (613)     (33,990)     (33,990)   (33,990) 
Distribution to noncontrolling interest  —              (245) (245) 
Cumulative effect of adoption of ASU No. 2016-13  —        (940)   (940)   (940) 
Balances as of April 30, 202064,526  $69  $1,677,775  $(208,124) $(112,544) $(178,774) $1,178,402  $14,504  $1,192,906  


See notes to condensed consolidated financial statements.
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VERINT SYSTEMS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
 Three Months Ended
April 30,
(in thousands) 20202019
Cash flows from operating activities:  
Net (loss) income$(3,975) $3,761  
Adjustments to reconcile net (loss) income to net cash provided by operating activities:  
Depreciation and amortization23,931  22,954  
Stock-based compensation, excluding cash-settled awards14,192  17,065  
Amortization of discount on convertible notes3,226  3,061  
Non-cash gains on derivative financial instruments, net(1,014) (549) 
Other non-cash items, net(3,537) 2,646  
Changes in operating assets and liabilities, net of effects of business combinations:  
Accounts receivable70,087  58,900  
Contract assets2,094  (39) 
Inventories(5,118) (3,118) 
Prepaid expenses and other assets(11,630) 5,268  
Accounts payable and accrued expenses564  8,487  
Contract liabilities(14,776) (24,648) 
Other, net1,934  (725) 
Net cash provided by operating activities75,978  93,063  
Cash flows from investing activities:
Cash paid for business combinations, including adjustments, net of cash acquired  (20,210) 
Purchases of property and equipment(8,835) (8,331) 
Purchases of investments(15,198) (9,995)