Business Wire | Aug 5, 2021 05:30AM EDT

NICE Reports Accelerated Total Revenue Growth of 16% and Cloud Revenue Growth of 32% for the Second Quarter of 2021

Aug. 05, 2021

HOBOKEN, N.J.--(BUSINESS WIRE)--Aug. 05, 2021--NICE (NASDAQ: NICE) today announced results for the second quarter ended June 30, 2021.

Second Quarter 2021 Financial Highlights

GAAP Non-GAAP

Revenue of $456 million, growth of 16% Revenue of $459 million, growth ofyear-over-year 16% year-over-year

Cloud revenue of $243 million, growth of Cloud revenue of $246 million,32% year-over-year growth of 32% year-over-year

Gross margin of 67.0% compared to 65.5% Gross margin of 72.2% compared tolast year 71.0% last year

Operating income of $64 million compared Operating income of $129.6 millionto $56 million last year, growth of 14% compared to $111.4 million lastyear-over-year year, growth of 16%

Operating margin of 14.0% compared to Operating margin of 28.2%, compared14.3% last year to 28.2% last year

Diluted EPS of $0.67 versus $0.68 last Diluted EPS of $1.57 versus $1.37year, decrease of 1% last year, growth of 15%

Operating cash flow increased 37% year-over-year to $81.4 million

"We are very pleased with the accelerated top line growth of 16% in the second quarter, which is a result of the combination of robust cloud growth and cloud revenue increasing to more than 50% of our total revenue," said Barak Eilam, CEO of NICE. "The strong second quarter financial results in all key metrics are being driven by solid execution in cloud, digital and AI, continued success with CXone in large enterprises and rapid growth in international markets."

Mr. Eilam continued, "While the cloudification of our market continues to speed up, the expansion to full digital CX represents an additional significant opportunity for NICE. With the investments we made in digital CX both organically and through acquisitions over the past 18 months, we have evolved CXone into a complete digital CX platform with a unique set of solutions that can now cover the entire customer journey across all customer touchpoints, including more than 35 digital channels. Digital transformation is still in the very early stages, and as the clear market leader, we believe we will achieve the same outstanding success in digital as we have in cloud."

GAAP Financial Highlights for the Second Quarter Ended June 30:

Revenues: Second quarter 2021 total revenues increased 16.0% to $456.0 million compared to $393.2 million for the second quarter of 2020.

Gross Profit: Second quarter 2021 gross profit and gross margin increased to $305.5 million and 67.0%, respectively, compared to $257.4 million and 65.5%, respectively, for the second quarter of 2020.

Operating Income: Second quarter 2021 operating income increased 14.0% to $64.0 million compared to $56.1 million, for the second quarter of 2020. Second quarter operating margin decreased to 14.0% compared to 14.3%, for the second quarter of 2020.

Net Income: Second quarter 2021 net income totaled $44.4 million compared to $44.6 for the second quarter of 2020. Net income margin decreased to 9.7% compared to 11.3% for the second quarter of 2020.

Fully Diluted Earnings Per Share: Fully diluted earnings per share for the Second quarter of 2021 decreased to $0.67, compared to $0.68 in the second quarter of 2020.

Operating Cash Flow and Cash Balance: Second quarter 2021 operating cash flow was $81.4 million. In the second quarter, $340 thousand was used for share repurchases. As of June 30, 2021, total cash and cash equivalents, short and long term investments were $1,407.7 million, and total debt was $613.1 million.

Non-GAAP Financial Highlights for the Second Quarter Ended June 30:

Revenues: Second quarter 2021 Non-GAAP total revenues increased 16.0% to $458.9 million compared to $395.1 million for the second quarter of 2020.

Gross Profit: Second quarter 2021 Non-GAAP gross profit and gross margin increased to $331.5 million and 72.2%, respectively, compared to $280.5 million and 71.0%, respectively, for the second quarter of 2020.

Operating Income: Second quarter 2021 Non-GAAP operating income increased 16.4% to $129.6 million compared to $111.4 million for the second quarter of 2020. Non-GAAP operating margin was 28.2%, compared to 28.2% last year.

Net Income: Second quarter 2021 Non-GAAP net income increased 16% to $104.3 million from $89.9 million for the second quarter of 2020. Non-GAAP net income margin was 22.7%, compared to 22.7% last year.

Fully Diluted Earnings Per Share: Second quarter 2021 Non-GAAP fully diluted earnings per share increased 14.6% to $1.57, compared to $1.37 for the second quarter of 2020.

Third Quarter and Full Year 2021 Guidance:

Third Quarter 2021:Third quarter 2021 Non-GAAP total revenues are expected to be in a range of $460 million to $470 million. Third quarter 2021 Non-GAAP fully diluted earnings per share are expected to be in a range of $1.51 to $1.61.

Raising Full Year 2021 Guidance:Full year 2021 Non-GAAP total revenues are expected to be in a range of $1,835 million to $1,855 million (higher than the previous guidance range of $1,800 million to $1,820 million). Full year 2021 Non-GAAP fully diluted earnings per share are expected to be in a range of $6.26 to $6.46 (higher than the previous guidance range of $6.19 to $6.39).

Quarterly Results Conference Call

NICE management will host its earnings conference call today August 5th, 2021 at 8:30 AM ET, 13:30 GMT, 15:30 Israel, to discuss the results and the company's outlook. To participate in the call, please dial into the following numbers: United States 1-877-300-8521 or +1-412-317-6026, United Kingdom 0-800-279-9489, Israel 1-809-213-284.

The call will be webcast live on the Company's website at https://www.nice.com/investor-relations/upcoming-event.

Non-GAAP financial measures are included in this press release. Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude share-based compensation, amortization of acquired intangible assets, acquisition related expenses, amortization of discount on debt and loss from extinguishment of debt and the tax effect of the Non-GAAP adjustments. Business combination accounting rules require the recognition of a legal performance obligation related to a revenue arrangement of an acquired entity as a liability. The amount assigned to such liability should be based on its fair value at the date of acquisition. The Non-GAAP adjustment for a revenue arrangement is intended to reflect the full amount of such revenue. The Company believes that these Non-GAAP financial measures, used in conjunction with the corresponding GAAP measures, provide investors with useful supplemental information about the financial performance of our business. We believe Non-GAAP financial measures are useful to investors as a measure of the ongoing performance of our business. Our management regularly uses our supplemental Non-GAAP financial measures internally to understand, manage and evaluate our business and to make financial, strategic and operating decisions. These Non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Our Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. These Non-GAAP financial measures may differ materially from the Non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and Non-GAAP basis is provided in a table immediately following the Consolidated Statements of Income. The Company provides guidance only on a Non-GAAP basis. A reconciliation of guidance from a GAAP to Non-GAAP basis is not available due to the unpredictability and uncertainty associated with future events that would be reported in GAAP results and would require adjustments between GAAP and Non-GAAP financial measures, including the impact of future possible business acquisitions. Accordingly, a reconciliation of the guidance based on Non-GAAP financial measures to corresponding GAAP financial measures for future periods is not available without unreasonable effort.

About NICENICE (Nasdaq: NICE) is the worldwide leading provider of both cloud and on-premises enterprise software solutions that empower organizations to make smarter decisions based on advanced analytics of structured and unstructured data. NICE helps organizations of all sizes deliver better customer service, ensure compliance, combat fraud and safeguard citizens. Over 25,000 organizations in more than 150 countries, including over 85 of the Fortune 100 companies, are using NICE solutions. www.nice.com.

Trademark Note: NICE and the NICE logo are trademarks or registered trademarks of NICE. All other marks are trademarks of their respective owners. For a full list of NICE' marks, please see: http://www.nice.com/nice-trademarks.

Forward-Looking StatementsThis press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements may be identified by words such as "believe," "expect," "seek," "may," "will," "intend," "should," "project," "anticipate," "plan," and similar expressions. Forward-looking statements are based on the current beliefs, expectations and assumptions of the Company's management regarding the future of the Company's business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Examples of forward-looking statements include guidance regarding the Company's revenue and earnings and the growth of our cloud, analytics and artificial intelligence business.

Forward looking statements are inherently subject to significant economic, competitive and other uncertainties and contingencies, many of which are beyond the control of management. The Company cautions that these statements are not guarantees of future performance, and investors should not place undue reliance on them. There are or will be important known and unknown factors and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. These factors, include, but are not limited to, risks associated with changes in economic and business conditions, competition, successful execution of the Company's growth strategy, success and growth of the Company's cloud Software-as-a-Service business, difficulties in making additional acquisitions or effectively integrating acquired operations, products, technologies and personnel, the Company's dependency on third-party cloud computing platform providers, hosting facilities and service partners, rapidly changing technology, cyber security attacks or other security breaches against the Company, privacy concerns and legislation impacting the Company's business, changes in currency exchange rates and interest rates, the effects of additional tax liabilities resulting from our global operations, uncertainty related to COVID-19 and various other factors and uncertainties discussed in our filings with the U.S. Securities and Exchange Commission (the "SEC").

You are encouraged to carefully review the section entitled "Risk Factors" in our latest Annual Report on Form 20-F and our other filings with the SEC for additional information regarding these and other factors and uncertainties that could affect our future performance. The forward-looking statements contained in this presentation speak only as of the date hereof, and the Company undertakes no obligation to update or revise them, whether as a result of new information, future developments or otherwise, except as required by law.

###

NICE LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

June 30, December 31,

2021 2020

Unaudited Audited

ASSETS

CURRENT ASSETS:

Cash and cash equivalents $ 343,452 $ 442,267

Short-term investments 1,064,290 1,021,613

Trade receivables 331,493 303,100

Prepaid expenses and other current assets 169,642 175,340

Total current assets 1,908,877 1,942,320

LONG-TERM ASSETS:

Property and equipment, net 143,014 137,785

Deferred tax assets 35,133 32,735

Other intangible assets, net 349,924 366,003

Operating lease right-of-use assets 91,647 97,162

Goodwill 1,595,613 1,503,252

Other long-term assets 180,125 153,660



Total long-term assets 2,395,456 2,290,597

TOTAL ASSETS $ 4,304,333 $ 4,232,917

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Trade payables $ 40,850 $ 33,132

Deferred revenues and advances from 327,955 311,851 customers

Current maturities of operating leases 21,372 22,412

Debt 187,866 259,881

Accrued expenses and other liabilities 409,992 417,174

Total current liabilities 988,035 1,044,450

LONG-TERM LIABILITIES:

Deferred revenues and advances from 73,197 36,295 customers

Operating leases 86,389 92,262

Deferred tax liabilities 18,396 32,109

Debt 425,284 421,337

Other long-term liabilities 17,514 17,980

Total long-term liabilities 620,780 599,983

SHAREHOLDERS' EQUITY

Nice Ltd's equity 2,672,128 2,563,910

Non-controlling interests 23,390 24,574

Total shareholders' equity 2,695,518 2,588,484

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 4,304,333 $ 4,232,917



NICE LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

U.S. dollars in thousands (except per share amounts)

NICE LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

U.S. dollars in thousands (except per share amounts)

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

Unaudited

Unaudited

Unaudited

Unaudited

Revenue:

Cloud

$

242,724

$

183,944

$

470,805

$

356,572

Services

167,133

170,979

328,924

344,171

Product

46,174

38,257

111,323

102,865

Total revenue

456,031

393,180

911,052

803,608

Cost of revenue:

Cloud

99,172

80,523

192,754

160,991

Services

46,882

50,037

95,816

103,550

Product

4,453

5,173

9,799

11,277

Total cost of revenue

150,507

135,733

298,369

275,818

Gross profit

305,524

257,447

612,683

527,790

Operating expenses:

Research and development, net

62,218

53,756

121,373

106,537

Selling and marketing

126,195

107,155

254,754

216,776

General and administrative

53,133

40,398

106,105

89,511

Total operating expenses

241,546

201,309

482,232

412,824

Operating income

63,978

56,138

130,451

114,966

Financial and other expense/(income), net

9,062

(423)

12,456

1,227

Income before tax

54,916

56,561

117,995

113,739

Taxes on income

10,515

11,956

21,383

23,020

Net income

$

44,401

$

44,605

$

96,612

$

90,719

Less: net loss attributable to non-controlling interests

380

182

383

266

Net income attributable to NICE Ltd.'s shareholders

$

44,781

$

44,787

$

96,995

$

90,985

Earnings per share:

Basic

$

0.70

$

0.71

$

1.53

$

1.45

Diluted

$

0.67

$

0.68

$

1.45

$

1.39

Weighted average shares outstanding:

Basic

63,108

62,638

63,096

62,557

Diluted

66,512

65,633

66,618

65,484

Quarter ended Year to date

June 30, June 30,

2021 2020 2021 2020

Unaudited Unaudited Unaudited Unaudited

Revenue:

Cloud $ 242,724 $ 183,944 $ 470,805 $ 356,572

Services 167,133 170,979 328,924 344,171

Product 46,174 38,257 111,323 102,865

Total revenue 456,031 393,180 911,052 803,608

Cost of revenue:

Cloud 99,172 80,523 192,754 160,991

Services 46,882 50,037 95,816 103,550

Product 4,453 5,173 9,799 11,277

Total cost of revenue 150,507 135,733 298,369 275,818

Gross profit 305,524 257,447 612,683 527,790

Operating expenses:

Research and development, net 62,218 53,756 121,373 106,537

Selling and marketing 126,195 107,155 254,754 216,776

General and administrative 53,133 40,398 106,105 89,511

Total operating expenses 241,546 201,309 482,232 412,824

Operating income 63,978 56,138 130,451 114,966

Financial and other expense/ 9,062 (423) 12,456 1,227(income), net

Income before tax 54,916 56,561 117,995 113,739

Taxes on income 10,515 11,956 21,383 23,020

Net income $ 44,401 $ 44,605 $ 96,612 $ 90,719

Less: net loss attributable to 380 182 383 266non-controlling interests

Net income attributable to NICE $ 44,781 $ 44,787 $ 96,995 $ 90,985Ltd.'s shareholders

Earnings per share:

Basic $ 0.70 $ 0.71 $ 1.53 $ 1.45

Diluted $ 0.67 $ 0.68 $ 1.45 $ 1.39

Weighted average sharesoutstanding:

Basic 63,108 62,638 63,096 62,557

Diluted 66,512 65,633 66,618 65,484

NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

U.S. dollars in thousands (except per share amounts)

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

GAAP revenues

$

456,031

$

393,180

$

911,052

$

803,608

Valuation adjustment on acquired deferred cloud revenue

2,773

1,950

4,596

2,729

Valuation adjustment on acquired deferred services revenue

60

-

166

-

Valuation adjustment on acquired deferred product revenue

-

-

-

-

Non-GAAP revenues

$

458,864

$

395,130

$

915,814

$

806,337

GAAP cost of revenue

$

150,507

$

135,733

$

298,369

$

275,818

Amortization of acquired intangible assets on cost of cloud

(18,211)

(16,064)

(35,727)

(31,622)

Amortization of acquired intangible assets on cost of services

(1,226)

(1,497)

(2,451)

(3,019)

Amortization of acquired intangible assets on cost of product

(287)

(1,125)

(570)

(2,259)

Valuation adjustment on acquired deferred cost of cloud

26

244

51

537

Cost of cloud revenue adjustment (1)

(1,676)

(948)

(3,170)

(1,792)

Cost of services revenue adjustment (1)

(1,646)

(1,680)

(4,081)

(3,280)

Cost of product revenue adjustment (1)

(126)

(68)

(251)

(136)

Non-GAAP cost of revenue

$

127,361

$

114,595

$

252,170

$

234,247

GAAP gross profit

$

305,524

$

257,447

$

612,683

$

527,790

Gross profit adjustments

25,979

23,088

50,961

44,300

Non-GAAP gross profit

$

331,503

$

280,535

$

663,644

$

572,090

GAAP operating expenses

$

241,546

$

201,309

$

482,232

$

412,824

Research and development (1,2)

(4,111)

(2,373)

(8,168)

(4,988)

Sales and marketing (1,2)

(6,911)

(8,797)

(17,819)

(14,062)

General and administrative (1,2)

(18,688)

(11,340)

(31,375)

(24,174)

Amortization of acquired intangible assets

(9,952)

(9,650)

(19,660)

(19,455)

Valuation adjustment on acquired deferred commission

55

36

108

71

Non-GAAP operating expenses

$

201,939

$

169,185

$

405,318

$

350,216

NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

U.S. dollars in thousands (except per share amounts)

Quarter ended Year to date

June 30, June 30,

2021 2020 2021 2020

GAAP revenues $ 456,031 $ 393,180 $ 911,052 $ 803,608

Valuation adjustment on acquired deferred cloud 2,773 1,950 4,596 2,729 revenue

Valuation adjustment on acquired deferred services 60 - 166 - revenue

Valuation adjustment on acquired deferred product - - - - revenue

Non-GAAP revenues $ 458,864 $ 395,130 $ 915,814 $ 806,337

GAAP cost of revenue $ 150,507 $ 135,733 $ 298,369 $ 275,818

Amortization of acquired intangible assets on cost (18,211) (16,064) (35,727) (31,622) of cloud

Amortization of acquired intangible assets on cost (1,226) (1,497) (2,451) (3,019) of services

Amortization of acquired intangible assets on cost (287) (1,125) (570) (2,259) of product

Valuation adjustment on acquired deferred cost of 26 244 51 537 cloud

Cost of cloud revenue (1,676) (948) (3,170) (1,792) adjustment (1)

Cost of services revenue (1,646) (1,680) (4,081) (3,280) adjustment (1)

Cost of product revenue (126) (68) (251) (136) adjustment (1)

Non-GAAP cost of revenue $ 127,361 $ 114,595 $ 252,170 $ 234,247

GAAP gross profit $ 305,524 $ 257,447 $ 612,683 $ 527,790

Gross profit adjustments 25,979 23,088 50,961 44,300

Non-GAAP gross profit $ 331,503 $ 280,535 $ 663,644 $ 572,090

GAAP operating expenses $ 241,546 $ 201,309 $ 482,232 $ 412,824

Research and development (4,111) (2,373) (8,168) (4,988) (1,2)

Sales and marketing (1,2) (6,911) (8,797) (17,819) (14,062)

General and administrative (18,688) (11,340) (31,375) (24,174) (1,2)

Amortization of acquired (9,952) (9,650) (19,660) (19,455) intangible assets

Valuation adjustment on acquired deferred 55 36 108 71 commission

Non-GAAP operating expenses $ 201,939 $ 169,185 $ 405,318 $ 350,216



NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(continued)

U.S. dollars in thousands (except per share amounts)

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

GAAP financial and other expense, net

$

9,062

$

(423)

$

12,456

$

1,227

Amortization of discount on debt and loss from extinguishment of debt

(10,811)

(2,532)

(14,937)

(4,874)

Non-GAAP financial and other income, net

$

(1,749)

$

(2,955)

$

(2,481)

$

(3,647)

GAAP taxes on income

$

10,515

$

11,956

$

21,383

$

23,020

Tax adjustments re non-GAAP adjustments

16,529

12,499

32,343

24,790

Non-GAAP taxes on income

$

27,044

$

24,455

$

53,726

$

47,810

GAAP net income

$

44,401

$

44,605

$

96,612

$

90,719

Valuation adjustment on acquired deferred revenue

2,833

1,950

4,762

2,729

Valuation adjustment on acquired deferred cost of cloud revenue

(26)

(244)

(51)

(537)

Amortization of acquired intangible assets

29,676

28,336

58,408

56,355

Valuation adjustment on acquired deferred commission

(55)

(36)

(108)

(71)

Share-based compensation (1)

31,251

25,206

62,957

46,851

Acquisition related expenses (2)

1,907

-

1,907

1,581

Amortization of discount on debt and loss from extinguishment of debt

10,812

2,532

14,937

4,874

Tax adjustments re non-GAAP adjustments

(16,529)

(12,499)

(32,343)

(24,790)

Non-GAAP net income

$

104,270

$

89,850

$

207,081

$

177,711

GAAP diluted earnings per share

$

0.67

$

0.68

$

1.45

$

1.39

Non-GAAP diluted earnings per share

$

1.57

$

1.37

$

3.11

$

2.71

Shares used in computing GAAP diluted earnings per share

66,512

65,633

66,618

65,484

Shares used in computing non-GAAP diluted earnings per share

66,512

65,633

66,618

65,484

NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(continued)

U.S. dollars in thousands (except per share amounts)

Quarter ended Year to date

June 30, June 30,

2021 2020 2021 2020

GAAP financial and other $ 9,062 $ (423) $ 12,456 $ 1,227 expense, net

Amortization of discount on debt and loss from (10,811) (2,532) (14,937) (4,874) extinguishment of debt

Non-GAAP financial and $ (1,749) $ (2,955) $ (2,481) $ (3,647) other income, net

GAAP taxes on income $ 10,515 $ 11,956 $ 21,383 $ 23,020

Tax adjustments re non-GAAP 16,529 12,499 32,343 24,790 adjustments

Non-GAAP taxes on income $ 27,044 $ 24,455 $ 53,726 $ 47,810

GAAP net income $ 44,401 $ 44,605 $ 96,612 $ 90,719

Valuation adjustment on 2,833 1,950 4,762 2,729 acquired deferred revenue

Valuation adjustment on acquired deferred cost of (26) (244) (51) (537) cloud revenue

Amortization of acquired 29,676 28,336 58,408 56,355 intangible assets

Valuation adjustment on acquired deferred (55) (36) (108) (71) commission

Share-based compensation 31,251 25,206 62,957 46,851 (1)

Acquisition related 1,907 - 1,907 1,581 expenses (2)

Amortization of discount on debt and loss from 10,812 2,532 14,937 4,874 extinguishment of debt

Tax adjustments re non-GAAP (16,529) (12,499) (32,343) (24,790) adjustments

Non-GAAP net income $ 104,270 $ 89,850 $ 207,081 $ 177,711

GAAP diluted earnings per $ 0.67 $ 0.68 $ 1.45 $ 1.39 share

Non-GAAP diluted earnings $ 1.57 $ 1.37 $ 3.11 $ 2.71 per share

Shares used in computing GAAP diluted earnings per 66,512 65,633 66,618 65,484 share

Shares used in computing non-GAAP diluted earnings 66,512 65,633 66,618 65,484 per share

NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued)

U.S. dollars in thousands

NICE LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued)

U.S. dollars in thousands

(1)

Share-based Compensation

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

Cost of cloud revenue

$

1,676

$

948

$

3,170

$

1,792

Cost of services revenue

1,646

1,680

4,081

3,280

Cost of product revenue

126

68

251

136

Research and development

4,111

2,373

8,168

4,988

Sales and marketing

6,911

8,797

17,819

13,974

General and administrative

16,781

11,340

29,468

22,681

$

31,251

$

25,206

$

62,957

$

46,851

(2)

Acquisition related expenses

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

Research and development

$

-

$

-

$

-

$

-

Sales and marketing

-

-

-

88

General and administrative

1,907

-

1,907

1,493

$

1,907

$

-

$

1,907

$

1,581

(1) Share-based Compensation

Quarter ended Year to date

June 30, June 30,

2021 2020 2021 2020

Cost of cloud revenue $ 1,676 $ 948 $ 3,170 $ 1,792

Cost of services revenue 1,646 1,680 4,081 3,280

Cost of product revenue 126 68 251 136

Research and development 4,111 2,373 8,168 4,988

Sales and marketing 6,911 8,797 17,819 13,974

General and administrative 16,781 11,340 29,468 22,681

$ 31,251 $ 25,206 $ 62,957 $ 46,851

(2) Acquisition related expenses

Quarter ended Year to date

June 30, June 30,

2021 2020 2021 2020

Research and development $ - $ - $ - $ -

Sales and marketing - - - 88

General and administrative 1,907 - 1,907 1,493

$ 1,907 $ - $ 1,907 $ 1,581

NICE LTD. AND SUBSIDIARIES

CONSOLIDATED CASH FLOW STATEMENTS

U.S. dollars in thousands

Quarter ended

Year to date

June 30,

June 30,

2021

2020

2021

2020

Unaudited

Unaudited

Unaudited

Unaudited

Operating Activities

Net income

$

44,402

$

44,605

$

96,613

$

90,719

Depreciation and amortization

45,911

45,601

90,835

89,651

Stock based compensation

30,979

25,064

62,434

46,632

Amortization of premium and discount and accrued interest on marketable securities

2,066

(3,618)

5,997

(2,870)

Deferred taxes, net

(16,207)

(678)

(17,065)

(9,870)

Changes in operating assets and liabilities:

Trade Receivables

(2,783)

14,134

(22,467)

14,793

Prepaid expenses and other assets

(14,103)

(20,677)

(24,963)

(34,768)

Trade payables

(4,912)

(13,283)

4,792

(805)

Accrued expenses and other current liabilities

(11,064)

(33,357)

(12,429)

(21,460)

Operating lease right-of-use assets, net

4,442

4,363

8,923

8,512

Deferred revenue

(3,843)

(415)

48,060

38,098

Operating lease liabilities

(4,778)

(4,132)

(10,475)

(9,689)

Amortization of discount on debt

3,513

2,532

7,612

4,875

Loss from extinguishment of debt

7,298

-

7,298

-

Other

519

(558)

515

585

Net cash provided by operating activities

81,440

59,581

245,680

214,403

Investing Activities

Purchase of property and equipment

(10,631)

(7,823)

(12,960)

(17,456)

Purchase of Investments

(70,442)

(69,061)

(223,748)

(154,488)

Proceeds from Investments

112,527

78,980

167,104

164,865

Capitalization of software development costs

(11,159)

(9,912)

(21,275)

(19,199)

Proceeds from business and asset acquisitions adjustments

-

-

444

-

Payments for business and asset acquisitions, net of cash acquired

(129,306)

-

(129,306)

(50,836)

Net cash used in investing activities

(109,011)

(7,816)

(219,741)

(77,114)

Financing Activities

Proceeds from issuance of shares upon exercise of share options

2,083

5,865

2,375

7,349

Purchase of treasury shares

(340)

(3,531)

(44,562)

(27,601)

Dividends paid to noncontrolling interest

(801)

-

(801)

-

Capital Lease payments

-

(15)

-

(177)

Repayment of debt

(82,814)

-

(82,814)

-

Net cash provided by/(used in) financing activities

(81,872)

2,319

(125,802)

(20,429)

Effect of exchange rates on cash and cash equivalents

1,767

902

1,048

(1,085)

Net change in cash and cash equivalents

(107,676)

54,986

(98,815)

115,775

Cash and cash equivalents, beginning of period

$

451,128

$

289,112

$

442,267

$

228,323

Cash and cash equivalents, end of period

$

343,452

$

344,098

$

343,452

$

344,098

View source version on businesswire.com: https://www.businesswire.com/news/home/20210805005469/en/

CONTACT: Investors Marty Cohen, +1 551 256 5354, ET, ir@nice.com Omri Arens, +972 3 763-0127, CET, ir@nice.com

CONTACT: Media Contact Chris Irwin-Dudek, +1 (551) 256-5140, Chris.Irwin-Dudek@nice.com