LogMeIn Scores Big HP Deal, Changes LogMeIn Free Business Model
IT management, customer service and remote control software provider LogMeIn reported higher revenues on a big HP deal, new products and a new limit on the free version of its remote control software.
IT management, customer service and remote control software provider LogMeIn, Inc. (NASDAQ:LOGM) is working on a new product that provides app management capabilities for IT managers due to be released next quarter, the company told financial analysts during its first quarter earnings call this week. And the company is also seeing momentum behind join.me and its recently introduced Cubby, plus strong uptake in the business model change it's made to its Central product line. Here are the details.
First, some background about the earnings and business, CEO Michael Simon said in the prepared earnings statement that the company's Access and Collaboration business, which includes join.me (screen sharing service) and Cubby (a DropBox alternative) again was the fastest growing of all the company's businesses. Other changes also led to growth.
LogMeIn Free Access Limit Set
Simon told analysts during the earnings call that the company's Central web based IT management console, which it calls its "next-gen RMM business" also exceeding expectations for the quarter largely due to a business model change designed to convert users of the free product line into paying users. That change put a limit of 10 on the number computers that a LogMeIn Free user is able to access. Those above that limit are being encouraged to purchase a subscription to the company's Central offering, which it is discounting to $199 per year for existing LogMeIn Free users. The company announced the changes on its blog last month.
LogMeIn also saw a really big customer win last quarter, HP, which bought LogMeIn Rescue in the largest deal in LogMeIn's history which was worth seven figures, executives told analysts during the conference call earlier this week, and transcribed by SeekingAlpha.
The Q1 Numbers
The following is a brief run down of the Q1 numbers:
LogMeIn reported a15 percent increase in revenue for Q1 2013 to $37.4 million compared to the $32.7 million reported for the same period a year ago. The company reported a GAAP net loss of $5.8 million or 24 cents per diluted share for Q1 compared with $76,000 or 0 cents per diluted share for the same period last year. Non-GAAP net income excluded stock compensation expenses, patent litigation expenses and acquisition expenses. Non-GAAP net income for Q1 was $3.1 million or 12 cents per diluted share. That compared to non-GAAP net income of $3.5 million or 14 cents per diluted share for the same period in 2012.
Looking ahead, LogMeIn said that it expects second quarter revenue in the range of $39 million to $39.5 million. The company expects a GAAP net loss in the range of $2.3 million to $2.6 million, or 9 cents to 10 cents per share.
Non-GAAP net income is expected to be in the range of $2.7 million to $3 million, or 11 cents to 12 cents per diluted share. Non-GAAP net income excludes an estimated $5.2 million of stock compensation expense, $500,000 in patent litigation related expenses, and $1.0 million in acquisition related costs and amortization.
The Company expects full year 2013 revenue to be in the range of $157 million to $160 million with a GAAP net loss of $11 million to 12.5 million or 44 cents to 50 cents per share.
Non-GAAP net income is expected to be in the range of $11.7 million to $12.7 million, or 46 cents to 50 cents per diluted share. Non-GAAP net income excludes an estimated $20.7 million in stock compensation expense, $7.6 million in patent litigation related expenses, and $3.4 million in acquisition related costs and amortization.