SEC Form 6-K filed by Check Point Software Technologies Ltd.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
of the Securities Exchange Act of 1934
INVESTOR CONTACT:
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MEDIA CONTACT:
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Kip E. Meintzer
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Gil Messing
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Check Point Software
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Check Point Software
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+1.650.628.2040
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+1.650.628.2260
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• |
Total Revenues: $599 million, a 6 percent increase year over year
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• |
Security Subscription Revenues: $263 million, a 15 percent increase year over year
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• |
GAAP Operating Income: $194 million, representing 32 percent of total revenues
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• |
Non-GAAP Operating Income: $252 million, representing 42 percent of total revenues
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GAAP EPS: $1.60, a 5 percent increase year over year
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Non-GAAP EPS: $2.04, a 13 percent increase year over year
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Total Revenues: $599 million compared to $566 million in the first quarter 2023, a 6 percent increase year over year.
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• |
GAAP Operating Income: $194 million compared to $200 million in the first quarter 2023, representing 32 percent and 35 percent of total revenues in the first quarter 2024 and 2023, respectively.
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• |
Non-GAAP Operating Income: $252 million compared to $238 million in the first quarter 2023, representing 42 percent of total revenues in both the first quarter 2024 and 2023.
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GAAP Taxes on Income: $33 million compared to $35 million in the first quarter 2023.
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GAAP Net Income & Earnings per Diluted Share: GAAP net income was $184 million same as in the first quarter 2023. GAAP earnings per diluted share were $1.60 compared to $1.52 in the first
quarter 2023, a 5 percent increase year over year.
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• |
Non-GAAP Net Income & Earnings per Diluted Share: Non-GAAP net income was $235 million compared to $218 million in the first quarter 2023. Non-GAAP earnings per diluted share were $2.04
compared to $1.80 in the first quarter 2023, a 13 percent increase year over year.
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Deferred Revenues: As of March 31, 2024, deferred revenues were $1,826 million compared to $1,797 million as of March 31, 2023, a 2 percent increase year over year.
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Cash Balances, Marketable Securities & Short-Term Deposits: $3,035 million as of March 31, 2024, compared to $2,960 million as of December 31, 2023.
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Cash Flow from Operations: Cash flow of $361 million compared to $386 million in the first quarter 2023.
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Share Repurchase Program: During the first quarter of 2024, the company repurchased approximately 2.0 million shares at a total cost of approximately $325 million.
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Check Point will host a conference call with the investment community on April 25, 2024, at 8:30 AM ET/5:30 AM PT. To listen to the live videocast or replay, please visit the website www.checkpoint.com/ir.
May 7-8, 2024, SF, CA – Group Meetings
May 16, 2024, Virtual – 1x1’s
May 20-22, 2024, Boston, MA – Fireside Chat & 1x1’s
May 26, 2024, Tel Aviv, Israel – Fireside Chat & 1x1’s
May 29, 2024, NY, NY – Fireside Chat & 1x1’s
May 30, 2024, Newport Coast, CA – 1x1’s
June 4, 2024, SF, CA – 1x1’s
June 5-6, 2024, SF, CA – 1x1’s
June 11, 2024, London, UK – 1x1’s
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Check Point uses non-GAAP measures of operating income, net income, and earnings per diluted share, which are adjustments from results based on GAAP to exclude, as applicable, stock-based compensation expenses, amortization of intangible assets and acquisition related expenses and the related tax affects. Check Point’s management believes the non-GAAP financial information provided in this release is useful to investors’ understanding and assessment of Check Point’s ongoing core operations and prospects for the future. Historically, Check Point has also publicly presented these supplemental non-GAAP financial measures to assist the investment community in visualizing the Company “through the eyes of management,” and thereby enhance understanding of its operating performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating the business internally and has determined that it is important to provide this information to investors.
CONSOLIDATED STATEMENT OF INCOME
Three Months Ended
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||||||||
March 31,
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||||||||
2024
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2023
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|||||||
Revenues:
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||||||||
Products and licenses
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$
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100.3
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$
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108.0
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||||
Security subscriptions
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263.4
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228.2
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||||||
Total revenues from products and security subscriptions
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363.7
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336.2
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||||||
Software updates and maintenance
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235.1
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230.0
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||||||
Total revenues
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598.8
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566.2
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||||||
Operating expenses:
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||||||||
Cost of products and licenses
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19.9
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26.2
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||||||
Cost of security subscriptions
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16.5
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12.3
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||||||
Total cost of products and security subscriptions
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36.4
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38.5
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||||||
Cost of Software updates and maintenance
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28.7
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26.8
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||||||
Amortization of technology
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5.8
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2.8
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||||||
Total cost of revenues
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70.9
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68.1
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||||||
Research and development
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99.2
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91.5
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||||||
Selling and marketing
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206.2
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177.7
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||||||
General and administrative
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28.6
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29.1
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||||||
Total operating expenses
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404.9
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366.4
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||||||
Operating income
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193.9
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199.8
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||||||
Financial income, net
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22.6
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19.1
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||||||
Income before taxes on income
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216.5
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218.9
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||||||
Taxes on income
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32.6
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34.8
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||||||
Net income
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$
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183.9
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$
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184.1
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Basic earnings per share
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$
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1.64
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$
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1.54
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||||
Number of shares used in computing basic earnings per share
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112.3
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119.8
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||||||
Diluted earnings per share
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$
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1.60
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$
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1.52
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Number of shares used in computing diluted earnings per share
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115.2
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121.1
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SELECTED FINANCIAL METRICS
(Unaudited, in millions, except per share amounts)
Three Months Ended
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||||||||
March 31,
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||||||||
2024
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2023
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|||||||
Revenues
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$
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598.8
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$
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566.2
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||||
Non-GAAP operating income
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252.0
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238.4
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||||||
Non-GAAP net income
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234.5
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217.9
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||||||
Non-GAAP diluted earnings per share
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$
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2.04
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$
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1.80
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Number of shares used in computing diluted Non-GAAP earnings per share
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115.2
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121.1
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Three Months Ended
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||||||||
March 31,
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||||||||
2024
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2023
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|||||||
GAAP operating income
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$
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193.9
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$
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199.8
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||||
Stock-based compensation (1)
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41.6
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32.7
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||||||
Amortization of intangible assets and acquisition related expenses (2)
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16.5
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5.9
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Non-GAAP operating income
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$
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252.0
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$
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238.4
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GAAP net income
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$
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183.9
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$
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184.1
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||||
Stock-based compensation (1)
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41.6
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32.7
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||||||
Amortization of intangible assets and acquisition related expenses (2)
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16.5
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5.9
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||||||
Taxes on the above items (3)
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(7.5
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)
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(4.8
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)
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Non-GAAP net income
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$
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234.5
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$
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217.9
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||||
GAAP diluted earnings per share
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$
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1.60
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$
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1.52
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Stock-based compensation (1)
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0.36
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0.27
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||||||
Amortization of intangible assets and acquisition related expenses (2)
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0.15
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0.05
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||||||
Taxes on the above items (3)
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(0.07
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)
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(0.04
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)
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Non-GAAP diluted earnings per share
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$
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2.04
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$
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1.80
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Number of shares used in computing diluted Non-GAAP earnings per share
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115.2
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121.1
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||||||
(1) Stock-based compensation:
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||||||||
Cost of products and licenses
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$
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0.1
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$
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0.1
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||||
Cost of software updates and maintenance
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2.2
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1.2
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||||||
Research and development
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14.7
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10.6
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||||||
Selling and marketing
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15.9
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11.3
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||||||
General and administrative
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8.7
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9.5
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||||||
41.6
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32.7
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|||||||
(2) Amortization of intangible assets and acquisition related expenses:
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||||||||
Amortization of technology-cost of revenues
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5.8
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2.8
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||||||
Research and development
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1.6
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1.9
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||||||
Selling and marketing
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9.1
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1.2
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||||||
16.5
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5.9
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|||||||
(3) Taxes on the above items
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(7.5
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)
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(4.8
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)
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||||
Total, net
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$
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50.6
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$
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33.8
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March 31,
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December 31,
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|||||||
2024
(Unaudited)
|
2023
(Audited)
|
|||||||
Current assets:
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||||||||
Cash and cash equivalents
|
$
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536.6
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$
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537.7
|
||||
Marketable securities and short-term deposits
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1,065.8
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992.3
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||||||
Trade receivables, net
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386.3
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657.7
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||||||
Prepaid expenses and other current assets
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79.1
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70.0
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||||||
Total current assets
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2,067.8
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2,257.7
|
||||||
Long-term assets:
|
||||||||
Marketable securities
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1,432.9
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1,429.7
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||||||
Property and equipment, net
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79.6
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80.4
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||||||
Deferred tax asset, net
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91.4
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81.8
|
||||||
Goodwill and other intangible assets, net
|
1,735.0
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1,748.5
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||||||
Other assets
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99.9
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97.4
|
||||||
Total long-term assets
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3,438.8
|
3,437.8
|
||||||
Total assets
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$
|
5,506.6
|
$
|
5,695.5
|
Current liabilities:
|
||||||||
Deferred revenues
|
$
|
1,347.0
|
$
|
1,413.8
|
||||
Trade payables and other accrued liabilities
|
433.9
|
502.3
|
||||||
Total current liabilities
|
1,780.9
|
1,916.1
|
||||||
Long-term liabilities:
|
||||||||
Long-term deferred revenues
|
478.9
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493.9
|
||||||
Income tax accrual
|
446.0
|
436.1
|
||||||
Other long-term liabilities
|
34.0
|
28.4
|
||||||
958.9
|
958.4
|
|||||||
Total liabilities
|
2,739.8
|
2,874.5
|
||||||
Shareholders’ equity:
|
||||||||
Share capital
|
0.8
|
0.8
|
||||||
Additional paid-in capital
|
2,808.0
|
2,732.5
|
||||||
Treasury shares at cost
|
(13,354.6
|
)
|
(13,041.2
|
)
|
||||
Accumulated other comprehensive gain
|
(39.4
|
)
|
(39.2
|
)
|
||||
Retained earnings
|
13,352.0
|
13,168.1
|
||||||
Total shareholders’ equity
|
2,766.8
|
2,821.0
|
||||||
Total liabilities and shareholders’ equity
|
$
|
5,506.6
|
$
|
5,695.5
|
||||
Total cash and cash equivalents, marketable securities, and short-term deposits
|
$
|
3,035.3
|
$
|
2,959.7
|
Three Months Ended
|
||||||||
March 31,
|
||||||||
2024
|
2023
|
|||||||
Cash flow from operating activities:
|
||||||||
Net income
|
$
|
183.9
|
$
|
184.1
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation of property and equipment
|
7.3
|
6.9
|
||||||
Amortization of intangible assets
|
13.5
|
3.3
|
||||||
Stock-based compensation
|
41.6
|
32.7
|
||||||
Decrease in trade and other receivables, net
|
265.4
|
285.1
|
||||||
Decrease in deferred revenues, trade payables and other accrued liabilities
|
(140.6
|
)
|
(127.1
|
)
|
||||
Deferred income taxes, net
|
(10.1
|
)
|
0.6
|
|||||
Net cash provided by operating activities
|
361.0
|
385.6
|
||||||
Cash flow from investing activities:
|
||||||||
Investment in property and equipment
|
(6.5
|
)
|
(4.2
|
)
|
||||
Net cash used in investing activities
|
(6.5
|
)
|
(4.2
|
)
|
||||
Cash flow from financing activities:
|
||||||||
Proceeds from issuance of shares upon exercise of options
|
45.6
|
34.1
|
||||||
Purchase of treasury shares
|
(325.0
|
)
|
(324.9
|
)
|
||||
Payments related to shares withheld for taxes
|
(1.1
|
)
|
(1.0
|
)
|
||||
Net cash used in financing activities
|
(280.5
|
)
|
(291.8
|
)
|
||||
Unrealized gain on marketable securities, net
|
1.6
|
26.6
|
||||||
Increase in cash and cash equivalents, marketable securities, and short-term deposits
|
75.6
|
116.2
|
||||||
Cash and cash equivalents, marketable securities, and short-term deposits at the beginning of the period
|
2,959.7
|
3,503.2
|
||||||
Cash and cash equivalents, marketable securities, and short-term deposits at the end of the period
|
$
|
3,035.3
|
$
|
3,619.4
|
CHECK POINT SOFTWARE TECHNOLOGIES LTD.
|
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By: /s/ Roei Golan
Roei Golan
Chief Financial Officer
|