Alteryx Announces First Quarter 2019 Financial Results

Alteryx, Inc. (NYSE: AYX), revolutionizing business through data science
and analytics, today announced financial results for its first quarter
ended March 31, 2019.

“We had a solid start to 2019 as many of the positive industry trends we
saw in 2018 continued,” said Dean Stoecker, CEO of Alteryx, Inc. “We
believe our addressable market continues to expand as companies across
the globe increasingly seek to leverage data to drive better decisions
and outcomes. To address this growing opportunity, we expect to continue
to invest to support the needs of the increasingly global Alteryx
community.”

First Quarter 2019 Financial Highlights

• Revenue: Revenue for the first quarter of 2019 was
  $76.0 million, an increase of 51%, compared to revenue of $50.3
  million in the first quarter of 2018.
• Gross Profit: GAAP gross profit for the first quarter of 2019
  was $68.0 million, or a GAAP gross margin of 89%, compared to GAAP
  gross profit of $45.3 million, or a GAAP gross margin of 90%, in the
  first quarter of 2018. Non-GAAP gross profit for the first quarter of
  2019 was $68.8 million, or a non-GAAP gross margin of 90%, compared to
  non-GAAP gross profit of $45.9 million, or a non-GAAP gross margin of
  91%, in the first quarter of 2018.
• Income (Loss) from Operations: GAAP loss from operations for
  the first quarter of 2019 was $(4.4) million, compared to a GAAP
  income from operations of $2.7 million for the first quarter of 2018.
  Non-GAAP income from operations for the first quarter of 2019 was $1.4
  million compared to non-GAAP income from operations of $7.2 million
  for the first quarter of 2018.
• Net Income: GAAP net income attributable to common stockholders
  for the first quarter of 2019 was $5.9 million, compared to a GAAP net
  income attributable to common stockholders of $4.9 million for the
  first quarter of 2018. GAAP net income per diluted share for the first
  quarter of 2019 was $0.09, based on 67.5 million GAAP weighted-average
  diluted shares outstanding, compared to GAAP net income per diluted
  share of $0.08, based on 63.5 million GAAP weighted-average diluted
  shares outstanding for the first quarter of 2018.

  Non-GAAP
  net income for the first quarter of 2019 was $3.0 million, compared to
  non-GAAP net income of $6.2 million for the first quarter of 2018.
  Non-GAAP net income per diluted share for the first quarter of 2019
  was $0.04, based on 67.5 million non-GAAP weighted-average diluted
  shares outstanding, compared to a non-GAAP net income per diluted
  share of $0.10, based on 63.5 million non-GAAP weighted-average
  diluted shares outstanding for the first quarter of 2018.

• Balance Sheet and Cash Flow: As of March 31, 2019, we had cash,
  cash equivalents, and short-term and long-term investments of $461.3
  million, compared with $426.2 million as of December 31, 2018. Cash
  provided by operating activities for the first quarter of 2019
  was $16.0 million compared to cash provided by operating activities
  of $12.1 million in the same period last year. As of March 31, 2019,
  we had an aggregate transaction price of $214.0 million, allocated to
  unsatisfied performance obligations related primarily to post-contract
  support, cloud-based offerings, and subscriptions to third-party
  syndicated data, compared to $223.1 million as of December 31, 2018.

A reconciliation of GAAP to non-GAAP financial measures has been
provided in the tables included in this press release. An explanation of
these measures is also included below under the heading “Non-GAAP
Financial Measures and Operating Measures.”

First Quarter 2019 and Recent Business Highlights

• Ended the first quarter of 2019 with 4,973 customers, a 35% increase
  from the first quarter of 2018. Added 277 net new customers in the
  first quarter of 2019.
• Achieved dollar-based net expansion rate (annual contract value based)
  of 134% for the first quarter of 2019.
• Acquired ClearStory Data Inc., an enterprise-scale, continuous
  intelligence analytics solution for complex and unstructured data.
• Expanded our international presence with new office launch events in
  Japan and Dubai.

Financial Outlook

As of May 1, 2019, guidance for the second quarter 2019 and full year
2019 is as follows:

• Second Quarter 2019 Guidance:
  • Revenue is expected to be in the range of $74.0 million to $77.0
    million, an increase of 44% to 50% year-over-year.
  • Non-GAAP loss from operations is expected to be in the range of
    $(4.0) million to $(7.0) million.
  • Non-GAAP net loss per share is expected to be in the range of
    $(0.04) to $(0.09) based on approximately 62.5 million non-GAAP
    weighted-average basic and diluted shares outstanding.
• Full Year 2019 Guidance:
  • Revenue is now expected to be in the range of $355.0 million to
    $360.0 million, an increase of 40% to 42% year-over-year.
  • Non-GAAP income from operations is now expected to be in the range
    of $30.0 million to $35.0 million.
  • Non-GAAP net income per share is now expected to be in the range
    of $0.38 to $0.45 based on approximately 68.0 million non-GAAP
    weighted-average diluted shares outstanding and an effective tax
    rate of 20%.

The financial outlook above for non-GAAP income (loss) from operations
and non-GAAP net income (loss) per share exclude estimates for
stock-based compensation expense, acquisition related adjustments,
amortization of debt discount and issuance costs, and certain
non-recurring items. A reconciliation of the non-GAAP financial guidance
measures to corresponding GAAP measures is not available on a
forward-looking basis primarily as a result of the uncertainty
regarding, and the potential variability of, stock-based compensation
expense, acquisition related adjustments, amortization of debt discount
and issuance costs, and certain non-recurring items. In particular,
stock-based compensation expense is impacted by our future hiring and
retention needs, as well as the future fair market value of our Class A
common stock, all of which is not within our control, is difficult to
predict, and is subject to constant change. The actual amount of these
expenses during 2019 will have a significant impact on our future GAAP
financial results. Accordingly, a reconciliation of the non-GAAP
financial guidance measures to the corresponding GAAP measures is not
available without unreasonable effort.

Quarterly Conference Call

Alteryx will host a conference call today at 5:00 p.m. Eastern Time to
discuss the company’s financial results. To access this call, dial
877-407-9716 (domestic) or 201-493-6779 (international). A live webcast
of this conference call will be available on the “Investors” page of the
company’s website at https://investor.alteryx.com.

Following the conference call, a telephone replay will be available
through May 8, 2019, at 844-512-2921 (domestic) or 412-317-6671
(international). The replay passcode is 13689448. An archived webcast of
this conference call will also be available on the “Investors” page of
the company’s website at https://investor.alteryx.com.

Non-GAAP Financial Measures and Operating Measures

To supplement our consolidated financial statements, which are prepared
and presented in accordance with GAAP, we use the following non-GAAP
financial measures: non-GAAP gross profit, non-GAAP gross margin,
non-GAAP income (loss) from operations, non-GAAP net income (loss),
non-GAAP net income (loss) per share, and non-GAAP weighted-average
diluted shares outstanding. The presentation of these financial measures
is not intended to be considered in isolation or as a substitute for, or
superior to, financial information prepared and presented in accordance
with GAAP.

We use non-GAAP measures to internally evaluate and analyze financial
results. We believe these non-GAAP financial measures provide investors
with useful supplemental information about the financial performance of
our business, enable comparison of financial results between periods
where certain items may vary independent of business performance, and
enable comparison of our financial results with other public companies,
many of which present similar non-GAAP financial measures. We exclude
the following items from one or more of our non-GAAP financial measures:

Stock-based compensation expense. We exclude stock-based
compensation expense, which is a non-cash expense, from certain of our
non-GAAP financial measures because we believe that excluding this item
provides meaningful supplemental information regarding operational
performance. In particular, companies calculate stock-based compensation
expense using a variety of valuation methodologies and subjective
assumptions.

Acquisition related adjustments. We exclude amortization of
intangible assets and changes in fair value of contingent consideration,
which are non-cash, related to business combinations from certain of our
non-GAAP financial measures. We exclude such expenses as they are
related to a business combination and have no direct correlation to the
operation of our business.

Convertible senior notes adjustments. We exclude the portion of
amortization of debt discount and issuance costs that relate to the
equity component of our convertible notes, which are non-cash, from
certain of our non-GAAP financial measures. We exclude such expenses as
they are non-cash and have no direct correlation to the operation of our
business.

Income tax adjustments. We utilize a fixed annual projected
non-GAAP tax rate in order to provide better consistency across the
interim reporting periods by eliminating the effects of items such as
changes in the tax valuation allowance, excess tax benefits associated
with stock options, and tax effects of acquisition-related costs, since
each of these can vary in size and frequency. When projecting this rate,
we evaluated an annual projection that excludes the direct impact of the
following non-cash items: stock-based compensation expenses,
amortization of purchased intangibles, and the amortization of debt
discount and issuance costs. The projected rate also assumes no new
acquisitions, and considers other factors including our expected tax
structure, our tax positions in various jurisdictions and key
legislation in major jurisdictions where we operate. We used a projected
non-GAAP tax rate of 20% and 23% for 2019 and 2018, respectively. The
non-GAAP tax rate could be subject to change for a variety of reasons,
including the rapidly evolving global tax environment, significant
changes in our geographic earnings mix including due to acquisition
activity, or other changes to our strategy or business operations. We
will re-evaluate our long-term rate as appropriate.

Investors are cautioned that there are material limitations associated
with the use of non-GAAP financial measures as an analytical tool. In
particular, we exclude stock-based compensation expense, amortization of
intangible assets, and amortization of debt discount and issuance costs
which are recurring and will be reflected in our financial results for
the foreseeable future. The non-GAAP measures we use may be different
from non-GAAP financial measures used by other companies, limiting their
usefulness for comparison purposes. We compensate for these limitations
by providing specific information regarding the GAAP items excluded from
these non-GAAP financial measures.

Safe Harbor Statement

This press release contains forward-looking statements that involve
risks and uncertainties, including statements regarding our outlook for
the second quarter 2019 and full year 2019, our market opportunity, our
ability to execute our long-term growth strategy, our non-GAAP tax rate
for 2019, and other future events. These forward-looking statements are
only predictions and may differ materially from actual results due to a
variety of factors including, but not limited to: our history of losses;
our ability to manage our growth effectively; our ability to expand our
sales force and increase their productivity; the rate of growth in the
market for analytics products and services; our dependence on our
software platform for substantially all of our revenue; our ability to
attract new customers and expand sales to existing customers; our
ability to develop and release product and service enhancements and new
products and services to respond to rapid technological change in a
timely and cost-effective manner; intense and increasing competition in
our market; our ability to develop, maintain, and enhance our brand and
reputation cost-effectively; our ability to establish and maintain
successful relationships with our channel partners; our dependence on
technology and data licensed to us by third parties; risks associated
with our international operations; litigation, and related costs;
security breaches; and other general market, political, economic, and
business conditions.

Additional risks and uncertainties that could affect our financial
results are included under the caption “Risk Factors” in our Annual
Report on Form 10-K for the year ended December 31, 2018, which is
available on the Investor Relations page of our website at https://investor.alteryx.com
and on the SEC website at www.sec.gov.
Additional information will also be set forth in our Quarterly Report on
Form 10-Q for the quarter ended March 31, 2019. All forward-looking
statements contained herein are based on information available to us as
of the date hereof and we do not assume any obligation to update these
statements as a result of new information or future events.

About Alteryx, Inc.

Revolutionizing business through data science and analytics, Alteryx
offers an end-to-end analytics platform that empowers data analysts and
scientists alike to break data barriers, deliver insights, and
experience the thrill of getting to the answer faster. Organizations all
over the world rely on Alteryx daily to deliver actionable insights. For
more information visit www.alteryx.com.

Alteryx is a registered trademark of Alteryx, Inc. All other product and
brand names may be trademarks or registered trademarks of their
respective owners.

Alteryx, Inc.
Key Business Metrics
(unaudited)

Number of Customers. We define a customer at the end of
any particular period as an entity with a subscription agreement that
runs through the current or future period as of the measurement
date. Organizations with free trials have not entered into a
subscription agreement and are not considered customers. A single
organization with separate subsidiaries, segments, or divisions that use
our platform may represent multiple customers, as we treat each entity
that is invoiced separately as a single customer. In cases where
customers subscribe to our platform through our channel partners, each
end customer is counted separately.

Dollar-Based Net Expansion Rate. Our dollar-based net
expansion rate is a trailing four-quarter average of the annual contract
value, or ACV, which is defined as the subscription revenue that we
would contractually expect to recognize over the term of the contract
divided by the term of the contract, in years, from a cohort of
customers in a quarter as compared to the same quarter in the prior
year. To calculate our dollar-based net expansion rate, we first
identify a cohort of customers, or the Base Customers, in a particular
quarter, or the Base Quarter. A customer will not be considered a Base
Customer unless such customer has an active subscription on the last day
of the Base Quarter. We then divide the ACV in the same quarter of the
subsequent year attributable to the Base Customers, or the Comparison
Quarter, including Base Customers from which we no longer derive ACV in
the Comparison Quarter, by the ACV attributable to those Base Customers
in the Base Quarter. Our dollar-based net expansion rate in a particular
quarter is then obtained by averaging the result from that particular
quarter with the corresponding result from each of the prior three
quarters. The dollar-based net expansion rate excludes contract value
relating to professional services from that cohort.

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