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Cornerstone OnDemand, Inc. Announces Third Quarter 2011 Financial Results

Record Q3 revenue of $20.0 million, a 63% year-over-year increase

Record Q3 gross profit of $14.6 million, and gross margins of 73% (500 basis point year-over-year increase)

Record Q3 Bookings 1 of $24.0 million, a 47% year-over-year increase

Ended quarter with 710 clients and approximately 7.16 million users

SANTA MONICA, Calif. November 7, 2011 – Learning and talent management software provider Cornerstone OnDemand (NASDAQ: CSOD) today announced results for its third quarter ended September 30, 2011.

Revenue for the third quarter of 2011 was $20.0 million, representing a 63% year-over-year increase compared to the same period in 2010 and a 15% increase compared to the second quarter of 2011, after excluding the impact of the non-cash charge related to a common stock warrant in the amount of $2.5 million recorded during the second quarter of 2011.

Bookings1, which the company defines as gross revenue plus change in deferred revenue, was $24.0 million for the third quarter, representing a 47% year-over-year increase.

"Despite the current macro-economic uncertainty, our execution in our core markets has never been better, as evidenced by our year-to-date growth in bookings and new clients. We remain focused on the success of our clients, as well as the development of new areas of our business. At the same time, we continue to innovate, working with our clients to refine our organically-developed solution to meet the evolving talent management needs of leading organizations around the world," said Adam Miller, President and CEO.

Gross profit for the third quarter of 2011 was $14.6 million, representing a 5% year-over-year improvement compared to the same period in 2010. Gross margin for the third quarter of 2011 was 73% compared to 68% in the same period in 2010. The improvement in gross margin was a result of year-over-year revenue growth of 63% compared to a lower increase in cost of revenue of 38%, reflecting the company's realization of economies of scale in its consulting services and network infrastructure, as it continues to improve its processes for delivering client implementation and support programs.

Cornerstone's loss from operations for the third quarter of 2011 was $3.0 million compared to a loss from operations of $2.4 million for the same period in 2010, reflecting the company's continued investments in scaling its operations. Operating expenses as a percentage of revenue were 88%, consistent with the same period in 2010.

During the third quarter of 2011, net cash provided by operations was $0.6 million and the company used approximately $0.3 million in unlevered free cash flow.1 Cornerstone ended the third quarter with 710 clients and approximately 7.16 million users, representing 72% and 64% year-over-year growth of the company's client base and users, respectively.

At September 30, 2011, the company's total cash and cash equivalents and marketable securities were $81.4 million. At September 30, 2011, the company's total accounts receivable was $23.1 million.

In accordance with Generally Accepted Accounting Principles, or on a "GAAP" basis, Cornerstone's net loss for the third quarter of 2011 was $4.3 million compared to net loss of $22.2 million for the same period in 2010. GAAP net loss for the third quarter of 2011 was impacted by approximately $0.6 million in expenses associated with a proposed secondary offering, which was withdrawn in early August 2011. Non-GAAP net loss1 for the third quarter of 2011 was $2.7 million, or $(0.06) per share compared to non-GAAP net loss1 of $2.3 million, or $(0.25) per share, for the same period in 2010. Non-GAAP results exclude, if applicable for each given period, common stock warrant charges, expenses related to stock-based compensation and related employer-paid payroll taxes, changes in the fair value of preferred stock warrants, accretion related to preferred stock, amortization of debt discount and issuance costs, fees related to the early retirement of debt, and expenses associated with the company's withdrawn secondary offering.

1 Bookings, unlevered free cash flow, non-GAAP net loss and non-GAAP net loss per share are non-GAAP measures. Please see the discussion in the section "Non-GAAP Financial Measures" and in the reconciliations at the end of the release.

Quarterly Conference Call
Cornerstone OnDemand will host a conference call to discuss its third quarter 2011 results at 2:00 p.m. PST (5:00 p.m. EST) today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the company's Investor Relations Web site at The live call can be accessed by dialing 888-357-3694 (U.S.) or 973-890-8276 (outside the U.S.) and referencing passcode: 2554-3261. A replay of the call will also be available at or via telephone until 9:00 p.m. PST on November 11, 2011 by dialing 855-859-2056 (U.S.) or 404-537-3406 (outside the U.S.), and referencing passcode: 2554-3261.

A propos de Cornerstone OnDemand

Cornerstone OnDemand (NASDAQ : CSOD) est l’un des leaders des logiciels cloud de gestion de la formation et du capital humain. Recrutement, intégration, formation, gestion de la performance et de la rémunération, plans de succession, gestion des données RH, gestion des effectifs et analytique RH : la plateforme est pensée pour développer pleinement le potentiel des organisations et des personnes.

Plus de 3 250 clients et plus de 36 millions d’utilisateurs utilisent aujourd’hui le logiciel de Cornerstone OnDemand, dans 192 pays et en 43 langues.

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