Cloudera Reports Second Quarter Fiscal Year 2020 Financial Results

PALO ALTO, Calif., Sept. 4, 2019 /PRNewswire/ -- Cloudera, Inc. (NYSE: CLDR), the enterprise data cloud company, reported results for its second quarter of fiscal year 2020, ended July 31, 2019. Total revenue for the second quarter was $196.7 million, and subscription revenue was $164.1 million. Annualized Recurring Revenue grew 16% year-over-year.

"We executed better in Q2, exceeding expectations on all our financial measures. Most importantly, we delivered an initial release of our cloud-native data management and analytics offering, Cloudera Data Platform. We already have a select group of customers evaluating this rich set of public cloud services, CDP Data Hub, Data Warehouse, and Machine Learning," said Marty Cole, chairman of the board and interim chief executive officer, Cloudera. "We are focused on meeting our customers' demands for hybrid and multi-cloud solutions that support use cases from the Edge to AI. That is the promise of CDP and the enterprise data cloud. Also, our internal metrics and pipeline generation have materially improved from Q1 levels. Together with solid execution in our second quarter, we are 'on plan' for achieving our objectives for this fiscal year."

All numbers reported for prior periods are presented for Cloudera on a standalone basis since the merger with Hortonworks, Inc. closed on January 3, 2019, and, as such, there is no comparative year-over-year financial information for the combined company.

GAAP loss from operations for the second quarter of fiscal 2020 was $89.1 million, compared to a GAAP loss from operations of $29.4 million for the second quarter of fiscal 2019.

Non-GAAP loss from operations for the second quarter of fiscal 2020 was $7.4 million, compared to a non-GAAP loss from operations of $8.3 million for the second quarter of fiscal 2019.

Operating cash flow for the second quarter of fiscal 2020, which includes $13.3 million of merger-related payments, was negative $33.0 million, compared to operating cash flow of negative $23.6 million for the second quarter of fiscal 2019.

GAAP net loss per share for the second quarter of fiscal 2020 was $0.31 per share, based on weighted-average shares outstanding of 276.8 million shares, compared to a GAAP net loss per share of $0.19 per share for the second quarter of fiscal 2019, based on weighted-average shares outstanding of 149.5 million shares. See financial statement tables below for additional information regarding historical and forward-looking stock-based compensation expenses and shares outstanding.

Non-GAAP net loss per share for the second quarter of fiscal 2020 was $0.02 per share, based on weighted-average shares outstanding of 276.8 million shares, compared to a non-GAAP net loss per share of $0.05 per share for the second quarter of fiscal 2019, based on weighted-average shares outstanding of 149.5 million shares.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading Non-GAAP Financial Measures.

As of July 31, 2019, the company had total cash, cash equivalents, marketable securities and restricted cash of $508.6 million.

Recent Business and Financial Highlights

    --  Annualized Recurring Revenue was $681.9 million, representing 16%
        year-over-year growth
    --  Non-GAAP subscription gross margin for the quarter was 86%
    --  Operating cash flow was negative $33.0 million, including $13.3 million
        of merger-related payments
    --  Customers with annualized recurring revenue greater than $100,000 were
        953, up 24 from the previous quarter
    --  Delivered the initial release of our cloud-native data management and
        analytics offering, Cloudera Data Platform, including Data Hub, Data
        Warehouse, and Machine Learning public cloud services
    --  Announced a new open source licensing and distribution framework,
        aligning Cloudera's model with the industry standard set by Red Hat
    --  Entered into an agreement to acquire Arcadia Data, a provider of
        cloud-native AI-powered business intelligence and real-time analytics
    --  Expanded our strategic partnership with IBM resulting in our best
        historical customer bookings quarter with IBM
    --  Cloudera was named an Overall Leader for Analytical Data Infrastructure
        by Dresner Advisory Services in their 2019 Industry Excellence Awards

Business Outlook

The outlook for the third quarter of fiscal 2020, ending October 31, 2019, is:

    --  Annualized Recurring Revenue in the range of $685 million to $695
        million
    --  Total revenue in the range of $187 million to $190 million
    --  Subscription revenue in the range of $162 million to $164 million
    --  Non-GAAP net loss per share in the range of $0.08 to $0.06 per share
    --  Weighted-average shares outstanding of approximately 283 million shares

The outlook for fiscal 2020, ending January 31, 2020, is:

    --  Annualized Recurring Revenue in the range of $685 million to $720
        million
    --  Total revenue in the range of $765 million to $775 million
    --  Subscription revenue in the range of $645 million to $655 million
    --  Operating cash flow in the range of negative $80 million to negative $65
        million, including $60 million of non-recurring merger-related payments
    --  Non-GAAP net loss per share in the range of $0.28 to $0.24 per share
    --  Weighted-average shares outstanding of approximately 280 million shares

Conference Call and Webcast Information

Cloudera is hosting a conference call for analysts and investors to discuss its second quarter of fiscal 2020 results and the outlook for its third quarter of fiscal 2020 and full year fiscal 2020 at 2:00 PM Pacific Time today. Participants can listen via webcast by visiting the Investor Relations section of Cloudera's website. A replay of the webcast will be available for two weeks following the call.

The conference call can also be accessed as follows:

    --  Participant Toll Free Number: +1-833-231-7247
    --  Participant International Number: +1-647-689-4091
    --  Conference ID: 8872765

About Cloudera

At Cloudera, we believe that data can make what is impossible today, possible tomorrow. We empower people to transform complex data into clear and actionable insights. Cloudera delivers an enterprise data cloud for any data, anywhere, from the Edge to AI. Powered by the relentless innovation of the open source community, Cloudera advances digital transformation for the world's largest enterprises. Learn more at cloudera.com.

Connect with Cloudera

About Cloudera: cloudera.com/about-cloudera.html
Read our VISION blog: vision.cloudera.com/ and Engineering blog: blog.cloudera.com/
Follow us on Twitter: twitter.com/cloudera and LinkedIn: linkedin.com/cloudera/
Visit us on Facebook: facebook.com/cloudera
See us on YouTube: youtube.com/user/clouderahadoop
Join the Cloudera Community: community.cloudera.com
Read about our customers' successes: cloudera.com/customers.html

Cloudera and associated marks are trademarks or registered trademarks of Cloudera, Inc. All other company and product names may be trademarks of their respective owners.

Forward-Looking Statements

Statements in this press release that are not historical in nature are forward-looking statements that, within the meaning of the federal securities laws including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, involve known and unknown risks and uncertainties. Words such as "may", "will", "expect", "intend", "plan", "believe", "seek", "could", "estimate", "judgment", "targeting", "should", "anticipate", "goal" and variations of these words and similar expressions, are also intended to identify forward-looking statements. The forward-looking statements in this press release address a variety of subjects, including statements about our short-term and long-term goals and targets, including expectations regarding the acceptance by our enterprise customers of enterprise data cloud and the Cloudera Data Platform, and our "Business Outlook" for our third quarter of fiscal 2020 and our full year fiscal 2020 operating results. Readers are cautioned that actual results could differ materially from those implied by such forward-looking statements due to a variety of factors, including global economic conditions, competitive pressures and pricing declines, intellectual property infringement claims, and other risks or uncertainties that are described under the caption "Risk Factors" in our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (SEC), and in our other SEC filings. You can obtain copies of the company's SEC filings on the SEC's website at www.sec.gov. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurances that our expectations will be attained. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

We report all financial information required in accordance with U.S. generally accepted accounting principles (GAAP). To supplement our unaudited and audited condensed consolidated financial statements presented in accordance with GAAP, we use certain non-GAAP measures of financial performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the results of our operations as determined in accordance with GAAP. The non-GAAP financial measures used by us include non-GAAP gross margins, non-GAAP subscription gross margins, non-GAAP operating expenses, non-GAAP loss from operations, non-GAAP operating margin, non-GAAP net loss, and historical and forward-looking non-GAAP net loss per share. These non-GAAP financial measures exclude stock-based compensation, acquisition- and disposition-related expenses (if any), and amortization of acquired intangible assets from the Cloudera unaudited condensed consolidated statement of operations. In addition, we use non-GAAP weighted-average shares outstanding to calculate non-GAAP net loss per share. This non-GAAP measure includes the impact of anti-dilutive restricted stock units and stock options outstanding, on a weighted basis.

For a description of these items, including the reasons why management adjusts for them, and reconciliations of historical non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled "Use of Non-GAAP Financial Information" as well as the related tables that precede it. We may consider whether other significant non-recurring items that arise in the future should also be excluded in calculating the non-GAAP financial measures we use.

We believe that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our core business, operating results or future outlook. Management uses, and believes that investors benefit from referring to, these non-GAAP financial measures in assessing our operating results, as well as when planning, forecasting and analyzing future periods. We use these non-GAAP financial measures in conjunction with traditional GAAP measures to communicate with our board of directors concerning our financial performance. These non-GAAP financial measures also facilitate comparisons of our performance to prior periods.

Annualized Recurring Revenue
Annualized Recurring Revenue ("ARR") is a performance metric, which we use to assess the health and trajectory of our business. ARR equals the annualized value of all recurring subscription contracts with active entitlements as of the end of the period, including pre-merger Hortonworks contracts. ARR does not reflect non-recurring partner revenue, subscription revenue with certain related parties, custom engineering and premium add-on support.


                                                                               
            
              Cloudera, Inc.

                                                              
            
              Condensed Consolidated Statements of Operations

                                                                   
            
              (in thousands, except per share data)

                                                                                
            
              (unaudited)




                                                Three Months Ended July 31,                                            Six Months Ended July 31,

                                                                                                           ---

                                     2019                            2018                      2019                                   2018
                                                        (As Adjusted)*                                                 (As Adjusted)*

                                                                                                                                    ---


     Revenue:



     Subscription                         $
       164,102                                                $
            95,798                              $
         318,940      $
         182,561



     Services                     32,609                                      17,181                                              65,239                     33,877




     Total revenue               196,711                                     112,979                                             384,179                    216,438



     Cost of revenue:(1) (2)



     Subscription                 29,075                                      14,961                                              58,412                     30,768



     Services                     28,055                                      17,171                                              59,951                     34,715



      Total cost of revenue        57,130                                      32,132                                             118,363                     65,483




     Gross profit                139,581                                      80,847                                             265,816                    150,955



     Operating expenses:(1) (2)


      Research and development     65,742                                      39,800                                             129,915                     83,464


      Sales and marketing         112,491                                      53,381                                             231,874                    115,191


      General and
       administrative              50,445                                      17,090                                              96,877                     33,426



      Total operating expenses    228,678                                     110,271                                             458,666                    232,081



      Loss from operations       (89,097)                                   (29,424)                                          (192,850)                  (81,126)


      Interest income, net          3,156                                       2,173                                               6,447                      3,980


      Other income (expense),
       net                            104                                       (907)                                                337                    (2,028)



      Loss before provision for
       income taxes              (85,837)                                   (28,158)                                          (186,066)                  (79,174)


      Provision for income
       taxes                      (1,206)                                      (791)                                            (4,107)                   (2,097)




     Net loss                            $
       (87,043)                                             $
            (28,949)                           $
         (190,173)    $
         (81,271)



      Net loss per share, basic
       and diluted                          $
       (0.31)                                               $
            (0.19)                              $
         (0.69)      $
         (0.55)



      Weighted-average shares
       used in computing net
       loss per share, basic
       and diluted                276,778                                     149,505                                             274,207                    148,115



               * As adjusted to reflect the
                impact of the full
                retrospective adoption of Topic
                606.



     
                (1) Amounts include stock-based compensation expense as follows (in thousands):




                                                          Three Months Ended July 31,                       Six Months Ended July 31,

                                                              ---                             ---

                                       2019                           2018                   2019              2018





      Cost of revenue -
       subscription                            $
              4,189                                   $
     2,496                           $
     8,008  $
     5,044


      Cost of revenue -
       services                       4,196                                    2,776                         8,456                        5,250


      Research and
       development                   18,453                                    8,336                        36,294                       18,197


      Sales and marketing            15,435                                    2,698                        28,799                        8,777


      General and
       administrative                19,460                                    4,169                        29,047                        8,573



     (2) Amounts include amortization of acquired intangible assets as follows (in thousands):




                                                      Three Months Ended July 31,                        Six Months Ended July 31,

                                                         ---                             ---

                                   2019                          2018                   2019            2018



      Cost of revenue
       - subscription                     $
              2,687                                   $
     622                               $
     5,597  $
     1,244


      Sales and
       marketing                 17,250                                      35                      34,500                               70


                                          
           
                Cloudera, Inc.

                                 
          
          Condensed Consolidated Statements of Operations

                                      
        
             (as a percentage of total revenue)

                                            
           
                (unaudited)




                                               Three Months Ended July 31,                             Six Months Ended July 31,

                                                                                    ---

                                   2019                    2018                           2019                2018
                                              (As Adjusted)*                                   (As Adjusted)*

                                                                                                            ---


     Revenue:



     Subscription                   83                                  85                                    83                     84
                                      %                                  %                                    %                     %



     Services                       17                                  15                                    17                     16




     Total revenue                 100                                 100                                   100                    100



     Cost of revenue(1) (2):



     Subscription                   15                                  13                                    15                     14



     Services                       14                                  15                                    16                     16



      Total cost of revenue          29                                  28                                    31                     30



     Gross margin                   71                                  72                                    69                     70


      Operating expenses(1) (2):


      Research and development       33                                  35                                    34                     39


      Sales and marketing            57                                  47                                    60                     53


      General and
       administrative                26                                  15                                    25                     15



      Total operating expenses      116                                  97                                   119                    107



      Loss from operations         (45)                               (25)                                 (50)                  (37)


      Interest income, net            2                                   2                                     2                      2


      Other income (expense),
       net                            -                                (1)                                                        (1)



      Loss before provision for
       income taxes                (43)                               (24)                                 (48)                  (36)


      Provision for income
       taxes                        (1)                                (1)                                  (2)                   (1)




     Net loss                     (44)                               (25)                                 (50)
                                      %                                  %                                                          %
                                                                                                              %                  (37)

                                                                                                                                         ===



               * As adjusted to reflect the
                impact of the full
                retrospective adoption of Topic
                606.



     
                (1) Amounts include stock-based compensation expense as a percentage of total revenue as follows:




                                                          Three Months Ended July 31,                                Six Months Ended July 31,



                                                                                 2019                           2018                    2019   2018



      Cost of revenue -                                                             2                                    2                       2     2
       subscription                                                                 %                                   %
                                                                                                                                               %    %


      Cost of revenue -
       services                                                                     2                                    2                       2     2


      Research and
       development                                                                  9                                    7                       9     8


      Sales and marketing                                                           8                                    2                       7     4


      General and
       administrative                                                              10                                    4                       8     4


      Total stock-based                                                            31                                   17                      28    20
       compensation                                                                 %                                   %
       expense                                                                                                                                 %    %



     (2) Amounts include amortization of acquired intangible assets as a percentage of total revenue as follows:




                                                      Three Months Ended July 31,                                 Six Months Ended July 31,



                                                                             2019                           2018                     2019   2018



      Cost of revenue                                                           1                                     1                       1    1
       - subscription                                                           %                                    %
                                                                                                                                            %    %


      Sales and
       marketing                                                                9                                                            9


      Total
       amortization of                                                          %                                    %
       acquired                                                                                                                             %    %
       intangible
       assets                                                                  10                                     1                      10    1


                                                      
       
                Cloudera, Inc.

                                           
              
         Condensed Consolidated Balance Sheets

                                                      
       
                (in thousands)

                                                        
       
                (unaudited)




                                                              July 31,                                        January 31,
                                                                  2019                                  2019

                                                                                                        ---


     
                ASSETS



     CURRENT ASSETS:


      Cash and cash equivalents                                             $
              88,075                              $
         158,672


      Marketable securities, current                           331,763                                 322,005


      Accounts receivable, net                                 160,298                                 242,980



     Contract assets                                            5,569                                   4,824



     Deferred costs                                            39,546                                  32,100


      Prepaid expenses and other
       current assets                                           31,342                                  38,281




     Total current assets                                     656,593                                 798,862


      Property and equipment, net                               26,061                                  27,619


      Marketable securities, non-
       current                                                  85,412                                  56,541


      Intangible assets, net                                   639,229                                 679,326



     Goodwill                                                 588,742                                 586,456


      Deferred costs, non-current                               30,301                                  36,913



     Restricted cash                                            3,352                                   3,367


      Operating lease right-of-use
       assets                                                  216,958



     Other assets                                               9,727                                   7,559



     TOTAL ASSETS                                                       $
              2,256,375                            $
         2,196,643



                   LIABILITIES AND STOCKHOLDERS' EQUITY



     CURRENT LIABILITIES:



     Accounts payable                                                       $
              4,283                                $
         8,185



     Accrued compensation                                      50,149                                  53,590


      Other contract liabilities,
       current                                                   7,935                                  17,177


      Other accrued liabilities                                 30,299                                  24,548


      Operating lease liabilities,
       current                                                  21,358


      Deferred revenue, current                                366,980                                 390,965



      Total current liabilities                                481,004                                 494,465


      Operating lease liabilities,
       non-current                                             205,466


      Deferred revenue, non-current                             87,952                                 116,604


      Other contract liabilities,
       non-current                                               1,053                                   1,296



     Other liabilities                                          5,404                                  22,209




     TOTAL LIABILITIES                                        780,879                                 634,574




     STOCKHOLDERS' EQUITY:



     Common stock                                                  14                                      13


      Additional paid-in capital                             2,814,767                               2,711,340


      Accumulated other comprehensive
       income (loss)                                               130                                    (42)



     Accumulated deficit                                  (1,339,415)                            (1,149,242)



      TOTAL STOCKHOLDERS' EQUITY                             1,475,496                               1,562,069



      TOTAL LIABILITIES AND
       STOCKHOLDERS' EQUITY                                              $
              2,256,375                            $
         2,196,643


                                                                                                                     
              
                Cloudera, Inc.

                                                                                                      
              
               Condensed Consolidated Statements of Cash Flows

                                                                                                                     
              
                (in thousands)

                                                                                                                       
              
                (unaudited)




                                                                              Three Months Ended July 31,                                                                    Six Months Ended July 31,

                                                                                                                                               ---

                                                    2019                                                      2018                       2019                                                          2018

                                                                                                 (As Adjusted)*                                                                         (As Adjusted)*

                                                                                                                                                                                                     ---



                   CASH FLOWS FROM OPERATING ACTIVITIES



     Net loss                                             $
            (87,043)                                                                 $
              (28,949)                                          $
            (190,173)        $
           (81,271)


      Adjustments to reconcile net loss to net cash
       (used in) provided by operating activities:


      Depreciation and amortization               34,433                                                                2,676                                                                       69,064                   5,068


      Stock-based compensation
       expense                                    61,733                                                               20,475                                                                      110,604                  45,841


      Accretion and amortization of
       marketable securities                       (735)                                                               (210)                                                                     (1,660)                  (195)


      Amortization of deferred costs              11,321                                                                7,240                                                                       20,973                  13,803


      Loss (gain) on disposal of fixed
       assets                                         44                                                                                                                                              459                    (20)



     Changes in assets and liabilities:



     Accounts receivable                       (14,836)                                                            (31,652)                                                                      80,660                  34,188



     Contract assets                              (214)                                                                   5                                                                        (745)                  2,850


      Prepaid expenses and other
       assets                                    (3,222)                                                               4,130                                                                      (3,213)                 12,297



     Deferred costs                            (12,395)                                                             (9,024)                                                                    (21,807)               (13,554)



     Accounts payable                           (1,056)                                                                 704                                                                      (3,661)                    583



     Accrued compensation                         6,440                                                                5,190                                                                      (6,090)                (9,437)


      Accrued expenses and other
       liabilities                               (5,238)                                                               2,792                                                                     (16,345)                  3,613


      Other contract liabilities                 (4,241)                                                                 152                                                                      (9,485)                    385



     Deferred revenue                          (17,971)                                                               2,918                                                                     (50,101)               (13,341)



      Net cash (used in) provided by
       operating activities                     (32,980)                                                            (23,553)                                                                    (21,520)                    810



                   CASH FLOWS FROM INVESTING ACTIVITIES


      Purchases of marketable
       securities and other
       investments                             (114,771)                                                           (138,133)                                                                    (311,224)              (252,376)


      Proceeds from sale of marketable
       securities and other
       investments                                30,114                                                               19,038                                                                       39,385                  32,294


      Maturities of marketable
       securities and other
       investments                               105,404                                                              116,690                                                                      235,402                 230,903



     Capital expenditures                       (2,028)                                                             (3,449)                                                                     (4,721)                (7,663)



      Net cash provided by (used in)
       investing activities                       18,719                                                              (5,854)                                                                    (41,158)                  3,158



                   CASH FLOWS FROM FINANCING ACTIVITIES


      Taxes paid related to net share
       settlement of restricted stock
       units                                     (7,847)                                                             (3,482)                                                                    (15,645)                (4,388)


      Proceeds from employee stock
       plans                                       3,270                                                                4,249                                                                        9,220                  11,330



      Net cash (used in) provided by
       financing activities                      (4,577)                                                                 767                                                                      (6,425)                  6,942



      Effect of exchange rate changes
       on cash, cash equivalents and
       restricted cash                             (449)                                                               (834)                                                                     (1,509)                (1,215)



      Net (decrease) increase in cash,
       cash equivalents and restricted
       cash                                     (19,287)                                                            (29,474)                                                                    (70,612)                  9,695


      Cash, cash equivalents and
       restricted cash -Beginning of
       period                                    110,714                                                              100,468                                                                      162,039                  61,299



      Cash, cash equivalents and
       restricted cash -End of period                        $
            91,427                                                                    $
              70,994                                             $
             91,427         $
             70,994







                   SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION


      Cash paid for income taxes                              $
            1,763                                                                       $
              737                                              $
             3,645          $
             1,898



      Cash paid for operating lease
       liabilities                                           $
            13,955                                                   
              $                                                                   $
             25,034   
     $





                   SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING
                    AND FINANCING ACTIVITIES


      Purchases of property and
       equipment in accounts payable
       and other accrued liabilities                            $
            500                                                                       $
              561                                                $
             500            $
             561



      Right-of-use assets obtained
       in exchange for new operating
       lease liabilities                                        $
            526                                                   
              $                                                                    $
             2,966   
     $



               * As adjusted to reflect the
                impact of the full
                retrospective adoption of Topic
                606.


                                                                                                   
           
                Cloudera, Inc.

                                                                                          
              
             Three Months Ended July 31, 2019

                                                                                     
              
             GAAP Results Reconciled to Non-GAAP Results

                                                                                      
              
             (in thousands, except per share amounts)

                                                                                                     
           
                (unaudited)




                                            GAAP                        Stock-Based                                   Amortization of                          Non-GAAP
                                                           Compensation                                     Acquired
                                                             Expense                                   Intangible Assets

                                                                                                                                                                    ---

      Cost of revenue-
       Subscription                              $
     29,075                                                                               $
              (4,189)                $
          (2,687)   $
      22,199


                   Subscription gross         82                                              3                                                                         2                  86
                    margin            
            %                                    
            %                                                                        %           
          %


      Cost of revenue-
       Services                           28,055                                        (4,196)                                                                                      23,859


                   Services gross             14                                             13                                                                           %               27
                    margin            
            %                                    
            %                                                                                    
          %


      Gross profit                       139,581                                          8,385                                                                     2,687             150,653


                   Total gross margin         71                                              4                                                                         1                  77
                                      
            %                                    
            %                                                                        %           
          %


      Research and
       development                        65,742                                       (18,453)                                                                                      47,289


      Sales and marketing                112,491                                       (15,435)                                                                 (17,250)             79,806


      General and
       administrative                     50,445                                       (19,460)                                                                                      30,985


      Loss from operations              (89,097)                                        61,733                                                                    19,937             (7,427)


                   Operating margin         (45)                                            31                                                                        10                 (4)
                                      
            %                                    
            %                                                               
            %           
          %



     Net loss                          (87,043)                                        61,733                                                                    19,937             (5,373)


      Net loss per share,
       basic and diluted                         $
     (0.31)                                                                                 $
              0.22                    $
          0.07    $
      (0.02)


                                                                                                  
         
                Cloudera, Inc.

                                                                                         
              
           Three Months Ended July 31, 2018

                                                                                    
             
           GAAP Results Reconciled to Non-GAAP Results

                                                                                      
             
           (in thousands, except per share amounts)

                                                                                                   
         
                (unaudited)




                                            GAAP                        Stock-Based                                   Amortization of                       Non-GAAP
                                                           Compensation                                     Acquired
                                                             Expense                                   Intangible Assets

                                                                                                                                                                 ---

      Cost of revenue-
       Subscription                              $
     14,961                                                                               $
           (2,496)                    $
        (622)   $
     11,843


                   Subscription gross         84                                                3                                                                    1                  88
                    margin            
            %                                       
           %                                                          
            %            
         %


      Cost of revenue-
       Services                           17,171                                          (2,776)                                                                                 14,395


                   Services gross              -         %                                    16                                                                       %              16
                    margin                                                             
           %                                                                                
         %


      Gross profit                        80,847                                            5,272                                                                  622              86,741


                   Total gross margin         72                                                5                                                                    1                  77
                                      
            %                                       
           %                                                          
            %            
         %


      Research and
       development                        39,800                                          (8,336)                                                                                 31,464


      Sales and marketing                 53,381                                          (2,698)                                                                (35)             50,648


      General and
       administrative                     17,090                                          (4,169)                                                                                 12,921


      Loss from operations              (29,424)                                          20,475                                                                  657             (8,292)


                   Operating margin         (26)                                              18                                                                    1                 (7)
                                      
            %                                       
           %                                                          
            %            
         %



     Net loss                          (28,949)                                          20,475                                                                  657             (7,817)


      Net loss per share,
       basic and diluted                         $
     (0.19)                                                                                 $
           0.14                 
     $               $
     (0.05)

Use of Non-GAAP Financial Information

In addition to the reasons stated under "Non-GAAP Financial Measures" above, which are generally applicable to each of the items Cloudera excludes from its non-GAAP financial measures, Cloudera believes it is appropriate to exclude or give effect to certain items for the following reasons:

    --  Stock-based compensation expense. We exclude stock-based compensation
        expense from our non-GAAP financial measures consistent with how we
        evaluate our operating results and prepare our operating plans,
        forecasts and budgets. Further, when considering the impact of equity
        award grants, we focus on overall stockholder dilution rather than the
        accounting charges associated with such equity grants. The exclusion of
        the expense facilitates the comparison of results and business outlook
        for future periods with results for prior periods in order to better
        understand the long term performance of our business.
    --  Amortization of acquired intangible assets. We exclude the amortization
        of acquired intangible assets from our non-GAAP financial measures.
        Although the purchase accounting for an acquisition necessarily reflects
        the accounting value assigned to intangible assets, our management team
        excludes the GAAP impact of acquired intangible assets when evaluating
        our operating results. Likewise, our management team excludes
        amortization of acquired intangible assets from our operating plans,
        forecasts and budgets. The exclusion of the expense facilitates the
        comparison of results and business outlook for future periods with
        results for prior periods in order to better understand the long term
        performance of our business.


                                                 
         
                Cloudera, Inc.

                                      
            
         Reconciliation of Non-GAAP Financial Guidance

                                                   
         
                (unaudited)




                                                                 Fiscal 2020



                                 (in millions)                        Q3                           FY

    ---


       GAAP net loss                                           ($97) -($91)                          ($378) -($367)


        Stock-based compensation
         expense (*)                                                      54                                      220


        Amortization of acquired
         intangible assets                                                20                                       80


        Non-GAAP net loss                                       ($23) -($17)                            ($78) -($67)



               (*) Stock-based compensation
                expense is impacted by variables
                such as stock price and employee
                behavior, each of which are
                inherently difficult to forecast.
                As a result, the guidance
                presented above is subject to a
                number of uncertainties and
                assumptions that may cause actual
                results to differ materially.

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SOURCE Cloudera, Inc.