FireEye Q2 Loss Sharply Widens, But Boosts 2014 Outlook

(RTTNews) - Cybersecurity provider FireEye, Inc. (FEYE) reported Tuesday a loss for the second quarter that sharply widened from last year, despite strong double-digit revenue growth, reflecting sharply higher operating expenses.

However, adjusted loss per share came in narrower than analysts' expectations, and quarterly revenues topped their estimates. The company also provided guidance for the third quarter, and raised outlook for the full-year 2014.

FireEye provides automated threat forensics and dynamic malware protection against the next generation of cyber attacks. The company has invented a purpose-built, virtual machine-based platform that provides real-time threat protection. It has over 1,000 customers across more than 40 countries.

"I am pleased to report strong growth in billings and revenue in the second quarter, which is reflected in our fourth increase to 2014 billings and revenue guidance ranges since our initial public offering in September 2013," Chairman and CEO David DeWalt said in a statement.

The Milpitas, California-based malware protection system company reported a net loss of $116.82 million or $0.82 per share for the second quarter, wider than $40.24 million or $2.15 per share in the prior-year quarter.

Excluding items, adjusted net loss for the quarter was $78.48 million or $0.55 per share, compared to a loss of $34.88 million or $1.87 per share in the year-ago quarter.

On average, 22 analysts polled by Thomson Reuters expected the company to report a loss of $0.60 per share for the quarter. Analysts' estimates typically exclude special items.

Results for the latest quarter were based on 141.90 million weighted average shares outstanding, while the year-ago quarter was based on 18.70 million weighted average shares outstanding.

Total revenues for the quarter surged to $94.49 million from $33.22 million in the same quarter last year, and topped nineteen Wall Street analysts' consensus estimate of $90.19 million.

Product revenue for the quarter surged to $37.7 million from $17.24 million in the prior-year quarter, as well as subscription and services revenue soared to $56.81 million from $33.22 million last year.

Second-quarter billings totaled $113.78 million, sharply higher than $45.01 million last year. Deferred revenue totaled $232.0 million at the end of the second quarter.

Total operating expenses nearly tripled to $179.93 million from $61.98 million in the year-ago quarter.

Looking ahead to the third quarter, the company expects adjusted loss in a range of $0.52 to $0.56 per share, on projected revenues between $114 million and $117 million, and billings between $150 million and $155 million, while analysts are looking for a loss of $0.56 per share on revenues of $108.88 million.

For fiscal 2014, the company now anticipates adjusted loss in the range of $2.05 to $2.15 per share, on projected revenues between $423 million and $430 million, and billings between $560 million and $580 million.

Street is currently looking for a full-year 2014 loss of $2.23 per share on annual revenues of $412.18 million.

Earlier, the company projected a loss of $2.10 to $2.30 per share and revenues of $405 million to $415 million, with billings between $550 million and $570 million.

FEYE closed Tuesday's regular trading session at $34.75, up $0.53 or 1.55% on a volume of 6.65 million shares. However, the stock lost $0.74 or 2.13% in after-hours trading.