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New words:
Antitrust, canceled, departure, disinterested, extinguished, freely, half, Holdco, HSR, impression, intensify, Nonrecurring, omitted, Oranje, outlook, Parent, pendency, preclusive, receipt, restraint, running, schedule, solicit, solicitation, surviving, timeframe, treatment, Vista, Voya, waiting
Removed:
assembled, forma, paying, pro, workforce
Financial report summary
?Competition
MimecastRisks
- The announcement and pendency of our agreement to be acquired by affiliates of Vista Equity Partners may have an adverse effect on our business results, and our failure to complete the Merger could have a material adverse effect on our business, financial condition, results of operations and stock price.
- While the Merger is pending, we are subject to business uncertainties and contractual restrictions that could harm our business relationships, financial condition, operating results, and business.
- Litigation may arise in connection with the Merger, which could be costly, prevent consummation of the Merger, divert management’s attention and otherwise materially harm our business.
- The Merger Agreement limits our ability to pursue alternatives to the Merger and may discourage other companies from trying to acquire us for greater consideration than what Vista has agreed to pay pursuant to the Merger Agreement.
- We have a limited operating history, which makes it difficult to forecast our revenues and evaluate our business and future prospects.
- We have generated significant net losses in the past, and we intend to continue to invest substantially in our business. As a result, we may not be able to achieve or sustain profitability in the future.
- We have experienced rapid growth in recent periods, and if we do not manage our future growth, our business and results of operations will be adversely affected.
- We believe our long-term value as a company will be greater if we focus on growth, which may negatively impact our profitability in the near term.
- If we do not expand our current customer base by attracting new customers and retaining our existing customers our business, financial condition and results of operations could be harmed.
- Failure to effectively develop and expand our sales and marketing capabilities or maintain successful relationships with our channel partners could harm our ability to increase our customer base and achieve broader market acceptance of our products.
- Our international operations and plans for future international expansion expose us to significant risks, and failure to manage those risks could adversely impact our business, financial condition and results of operations.
- A network, systems or data security incident may allow unauthorized access to our network, systems or data or our customers’ data, harm our reputation, create additional liability and adversely impact our financial results.
- We rely upon SaaS technologies from third parties to operate our business, and interruptions or performance problems with these technologies may adversely affect our business, financial condition and results of operations.
- We recognize revenues from subscriptions over the term of our customer contracts, and as such, our reported revenues and related metrics may differ significantly in a given period, and our revenues in any period may not be indicative of our financial health and future performance.
- The market in which we participate is competitive, and if we do not compete effectively, our business, financial condition and results of operations could be harmed.
- We may experience quarterly fluctuations in our results of operations due to a number of factors, including increasing variability in our sales cycles. These fluctuations make our future results difficult to predict and could cause our results of operations to fall below analyst or investor expectations.
- If we fail to maintain an effective system of internal controls over our financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired.
- The requirements of being a public company may strain our resources and divert management’s attention.
- We depend on our executive officers and other key employees, the loss of whom could adversely affect our business.
- The nature of our business requires the application of complex accounting rules, including revenue and expense recognition rules, and any significant changes in current rules, or interpretations thereof, could affect our financial statements and results of operations.
- Any future litigation against us could be costly and time-consuming to defend.
- Acquisitions, strategic investments, partnerships, or alliances could be difficult to identify, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value, and adversely affect our business, financial condition and results of operations.
- We may need to raise additional capital to expand our operations and invest in new products, which capital may not be available on terms acceptable to us, or at all, and which could reduce our ability to compete and could harm our business.
- Our Revolving Credit Facility contains financial covenants and other restrictions on our actions that may limit our operational flexibility or otherwise adversely affect our results of operations.
- If we fail to enhance our brand cost-effectively, our ability to expand our customer base will be impaired and our business, financial condition and results of operations may suffer.
- If we cannot maintain our company culture as we grow, we could lose the innovation, teamwork, passion and focus on execution that we believe contribute to our success and our business may be harmed.
- Our results of operations may be harmed if we are subject to a protracted infringement claim or a claim that results in a significant damage award.
- If we fail to adequately protect our proprietary rights, our competitive position could be impaired and we may lose valuable assets, generate reduced revenues and incur costly litigation to protect our rights.
- We use open source software in our products, which could negatively affect our ability to offer our products and subject us to litigation or other actions.
- We incorporate technology from third parties into our platform and products, and our inability to obtain or maintain rights to the technology could harm our business.
- Interruptions or delays in the services provided by third-party data centers or internet service providers could impair the delivery of our platform and products, expose us to litigation and negatively impact our relationships with customers, adversely affecting our business.
- If our platform and products fail to perform properly, our reputation could be adversely affected and our market share could decline, which could have a material adverse effect on our business, financial condition and results of operations.
- Complying with evolving privacy and other data related laws and requirements may be expensive and force us to make adverse changes to our business, and failure to comply with such laws and requirements could result in substantial harm to our business.
- We are subject to laws and regulations, including governmental export and import controls, sanctions, anti-boycott regulations and anti-corruption laws that could impair our ability to compete in our markets and subject us to liability if we are not in full compliance with applicable laws.
- Failure to comply with laws and regulations applicable to our business could subject us to fines and penalties.
- Sales to government entities are subject to a number of challenges and risks.
- Delaware law and provisions in our amended and restated certificate of incorporation and amended and restated bylaws could make a merger, tender offer or proxy contest difficult, thereby depressing the market price of our Class A common stock.
- Our amended and restated bylaws designate a state or federal court located within the State of Delaware and the federal district courts of the United States as the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to choose the judicial forum for disputes with us or our directors, officers or employees.
- Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
- Changes in tax laws or regulations in the various tax jurisdictions we are subject to that are applied adversely to us or our customers could increase the costs of our products and harm our business.
- Our business may be subject to additional obligations to collect and remit sales tax and other taxes, and we may be subject to tax liability for past sales. Any successful action by state, foreign or other authorities to collect additional or past sales tax could harm our business.
- We are a multinational organization faced with increasingly complex tax issues in many jurisdictions, and we could be obligated to pay additional taxes in various jurisdictions.
- The dual-class structure of our common stock has the effect of concentrating voting control with those stockholders who held our capital stock prior to the completion of our IPO, which will limit your ability to influence the outcome of important transactions, including a change in control.
- The market price of our Class A common stock may be volatile, and you could lose all or part of your investment.
- We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Class A common stock less attractive to investors.
- If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about us, our business or our market, or if they change their recommendations regarding our Class A common stock adversely, the market price and trading volume of our Class A common stock could decline.
- We do not intend to pay dividends for the foreseeable future.
- The issuance of additional stock in connection with financings, acquisitions, investments, our equity incentive plans or otherwise will dilute all other stockholders.
- We cannot predict the impact our dual class structure may have on the market price of our Class A common stock.
- Adverse economic conditions and reduced IT security spending may adversely impact our revenues and profitability.
- We are unable to predict with certainty the extent to which the global COVID-19 pandemic may continue to impact our business, financial condition or results of operations.
- We may face exposure to foreign currency exchange rate fluctuations.
- Catastrophic events may disrupt our business.
Management Discussion
- Revenues increased by $71.4 million, or 40.8%, for the year ended December 31, 2021, compared to the year ended December 31, 2020. Due to the nature of our subscription-based business model, a large portion of our revenues in a given period results from the recognition of revenues deferred in prior periods. As such, $37.7 million of the year-over-year increase in revenue is related to the recognition of deferred revenues from the accumulation of
- contracts entered into during prior periods. Revenues earned in foreign jurisdictions has increased by $18.3 million compared to the prior year. The remaining increase is attributable to revenues from new customers combined with revenues from cross-selling additional products into our existing customer base. Our customer base grew by 28.4% and the number of customers with active subscriptions to more than one of our products has increased to 22.1% of our total customer base.
- Cost of revenues increased by $8.4 million, or 31.4%, for the year ended December 31, 2021, compared to the year ended December 31, 2020. The overall increase in cost of revenues is in line with our increase in revenues over the same period, while maintaining our margin position. The total dollar value increase in cost of revenues is primarily driven by approximately $6.3 million of additional personnel and other allocated costs related to a combination of headcount expansion, comparatively higher performance bonuses resulting from the growth in revenues over the period and higher overhead allocations. Additionally, $1.2 million of the increase relates to increased costs of hosting our platform with the remaining cost increases attributable the amortization of both our acquired and internally developed technology and content. Gross margin slightly increased compared to the prior year period as we continue to scale our customer support functions.