Cyber Security

Tufin Announces First Quarter 2022 Results

First quarter revenue of $26.1 million increased 22% year-over-year

First quarter GAAP operating loss of $15.4 million and non-GAAP operating loss of $10.1 million

Tufin (NYSE: TUFN), a company pioneering a policy-centric approach to security and IT operations, today announced financial results for the first quarter ended March 31, 2022.

“I’m pleased to report another strong quarter for Tufin, with product revenue growth of 61% compared to the prior year driven by increasing demand for network cyber security solutions,” said Ruvi Kitov, Tufin’s CEO and Co-Founder. “We continued to make significant progress in our transition to subscription in the quarter, with subscriptions representing 77% of new license bookings thus far in 2022, which positions us well ahead of our long-term goals.”

Kitov continued, “As we announced last month, Tufin entered into a definitive agreement to be acquired by Turn/River, a private equity firm that specializes in helping subscription-based software businesses accelerate their strategy by expanding into new markets and reaching new customer segments. With their partnership, I am confident we will be able to execute on our long-term initiatives faster and more efficiently as a privately held company.”

Financial Highlights for the FirstQuarter Ended March 31, 2022

Revenue:

  • Total revenue was $26.1 million, up 22% compared with the first quarter of 2021.
  • Product revenue was $9.7 million, up 61% compared with the first quarter of 2021.
  • Maintenance and professional services revenue was $16.4 million, up 7% compared with the first quarter of 2021.

Gross Profit:

  • GAAP gross profit was $20.2 million, or 77% of total revenue, compared to $16.0 million in the first quarter of 2021, or 75% of total revenue.
  • Non-GAAP gross profit was $20.5 million, or 79% of total revenue, compared to $16.5 million in the first quarter of 2021, or 77% of total revenue.

Operating Loss:

  • GAAP operating loss was $15.4 million, compared to operating loss of $12.8 million in the first quarter of 2021.
  • Non-GAAP operating loss was $10.1 million, compared to non-GAAP operating loss of $9.5 million in the first quarter of 2021.

Net Loss:

  • GAAP net loss was $15.5 million, or a loss of $0.41 per diluted share, compared to a GAAP net loss of $11.6 million, or $0.32 per diluted share, in the first quarter of 2021.
  • Non-GAAP net loss was $10.6 million, or a loss of $0.28 per diluted share, compared to non-GAAP net loss of $9.8 million, or $0.27 per diluted share, in the first quarter of 2021.

Balance Sheet and Cash Flow:

  • Cash flow provided by operating activities during the three months ended March 31, 2022 was $8.8 million, compared to cash flow provided by operating activities of $9.3 million during the three months ended March 31, 2021.
  • Total cash, cash equivalents, restricted cash and marketable securities as of March 31, 2022 were $97.4 million, compared to $89.4 million as of December 31, 2021.

The tables at the end of this press release include a reconciliation of GAAP to non-GAAP gross profit, operating loss and net loss for the three months ended March 31, 2022 and 2021. An explanation of these measures is also included under the heading “Non-GAAP Financial Measures.”

Recent Business Highlights

  • Announced that Tufin Technical Support won a Bronze Stevie Award in the Customer Service Department of the Year in the Computer Software category. The Stevie Awards for Sales & Customer Service are the world’s top honors for customer service, contact center, business development, and sales professionals.
  • Announced that Tufin Orchestration Suite was named a 2022 Gold Winner in Network Security and Management by the Globee Awards 18th Annual Cyber Security Global Excellence Awards. The Globee Awards 18th Annual Cyber Security Global Excellence Awards recognize cyber security and information technology vendors with advanced, ground-breaking products, solutions, and services that are helping to set the bar higher for others in all areas of security and technologies.
  • Announced that Tufin Orchestration Suite has been named a 2022 Gold Winner by the Cybersecurity Excellence Awards in the category of Security Automation. The Cybersecurity Excellence Awards annually honor individuals, products and companies that demonstrate excellence, innovation, and leadership in information security.

Transaction with Turn/River Capital

As announced on April 6, 2022, Tufin entered into a definitive agreement whereby funds advised by Turn/River Capital, a U.S.-based private equity firm, will acquire all outstanding ordinary shares of Tufin for $13.00 per share in an all-cash transaction that values Tufin at approximately $570 million. The transaction remains on track, subject to customary closing conditions, including approval by Tufin shareholders and receipt of regulatory approvals. Upon completion of the transaction, the Company’s ordinary shares will no longer be listed on any public market.

In light of the pending transaction, Tufin will not be hosting an earnings conference call to discuss these results and Tufin will not be providing guidance for the second quarter or for the full fiscal year 2022.

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