RADCOM Reports Fourth Quarter and Full Year 2018 Results

February 12, 2019

RADCOM Reports Fourth Quarter and Full Year 2018 Results

•    Cash and Cash Equivalents of $62 million and No Debt
•    8% decrease in year over year revenues due to slower than expected pace of NFV transformations
•    Continuing investment in R&D activities to maintain technological leadership in support of expected 5G rollout

TEL AVIV, Israel – February 12, 2019 − RADCOM Ltd. (NASDAQ: RDCM), today reported its financial results for the fourth quarter and full year ended December 31, 2018

“During 2018, we delivered successfully on our project commitments while at the same time generating new opportunities,” commented Mr. Yaron Ravkaie, RADCOM’s CEO. “Although our results were affected by a slower than expected pace of NFV transformations, and while market conditions continue to affect our visibility into when operators will implement their NFV and 5G plans, we remain confident in the future of NFV and 5G and in our technological leadership, our solutions and strong industry recognition.  As operators begin to roll out 5G networks, RADCOM is well positioned as a leading assurance player for NFV, which will be the foundation for 5G-ready cloud services. The Company continues to invest in R&D activities, supported by our healthy balance sheet, to push our innovative technology forward and continue meeting the needs of our leading customers. Taking into account market conditions, we are currently providing revenue guidance for 2019 of $28 – $32 million.” 

Fourth Quarter 2018 Financial Highlights:

• Revenues: Total revenues for the fourth quarter were $4.0 million, down 62% compared to $10.6 million in the fourth quarter of 2017

• Net Income (loss): GAAP net loss for the period was $4.1 million, or $0.30 per diluted share, compared to GAAP net income of $2.3 million, or $0.17 per diluted share for the fourth quarter of 2017 

 Non-GAAP Net Income (loss):  Non-GAAP net loss for the period was $3.7 million, or $0.27 per diluted share, compared to non-GAAP net income of $2.7 million, or $0.21 per diluted share for the fourth quarter of 2017

• Balance sheet: As of December 31, 2018, the Company had cash and cash equivalents of $62 million and no debt

Full Year 2018 Financial Highlights:

• Revenues: Total revenues for the full year 2018 were $34.1 million, down 8% compared to $37.2 million in the full year 2017

• Net Income (loss): GAAP net loss for the full year 2018 was $2.4 million, or $0.18 per diluted share, compared to GAAP net income of $2.9 million, or $0.23 per diluted share for the full year 2017

• Non-GAAP Net Income (loss):  Non-GAAP net loss for the period was $0.3 million, or $0.02 per diluted share, compared to non-GAAP net income of $5.1 million, or $0.41 per diluted share for the full year 2017

Earnings Conference Call
RADCOM’s management will hold an interactive conference call today at 8:00 AM Eastern Time (3:00 PM Israel Standard Time) to discuss the results and to answer participants’ questions. To join the call, please call one of the following numbers approximately five minutes before the call is scheduled to begin:

From the US (toll-free): +1-888-407-2553

From other locations: +972-3-918-0610

For those unable to listen to the call at the time, a replay will be available from February 13th on RADCOM’s website.


RADCOM (NASDAQ: RDCM) is the leading expert in cloud-native Network Intelligence for telecom operators transitioning to SDN/NFV. Providing a critical first step in an operator’s NFV transformation, RADCOM’s Network Intelligence delivers end-to-end network visibility from virtual tapping point to network insights. Comprised of RADCOM Service Assurance, RADCOM Network Visibility, and RADCOM Network Insights, RADCOM’s Network Intelligence portfolio provides operators with complete visibility across their virtual and hybrid networks. RADCOM Network Intelligence is automated, cost-efficient, and provides on-demand functionality that is specifically designed for the needs of telecom operators. RADCOM specializes in assuring next-generation, high capacity networks, including LTE, Advanced-LTE, 5G, IMS, SDN/NFV and others. For more information on how to RADCOMize your network, today, please visit www.radcom.com, the content of which does not form a part of this press release.

Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the reader’s overall understanding of the Company’s financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, the Company’s non-GAAP results provide information to both management and investors that is useful in assessing the Company’s core operating performance and in evaluating and comparing the Company’s results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with GAAP.

Risks Regarding Forward-Looking Statements 
Certain statements made herein that use words such as “estimate,” “project,” “intend,” “expect,” “’believe”, ”may“, ”might”, “predict”, ”potential”, “anticipate”, “plan” or similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. For example, when the Company discusses its continued investment in technology to meet the needs of its clients, the expected role of NFV and the Companby’s solutions in 5G networks, the Company’s technological leadership or industry recognition, the Company’s pipeline of opportunities, and its revenue guidance, it is using forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that could cause the actual results, performance or achievements of the Company to be materially different from those that may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in the demand for the Company’s products, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on prices resulting from competition. For additional information regarding these and other risks and uncertainties associated with the Company’s business, reference is made to the Company’s reports filed from time to time with the U.S. Securities and Exchange Commission. The Company does not undertake to revise or update any forward-looking statements for any reason.

Consolidated Statements of Operations
(thousands of U.S. dollars, except share and per share data)

 Three months ended
 December 31,
 Twelve months ended 
December 31,
 2018 2017 2018 2017 
 (unaudited) (unaudited) (unaudited)   
Revenues$3,989 $10,631 $34,050 $37,233 
Cost of revenues1,439 2,660 8,866 10,488 
Gross profit2,550 7,971 25,184 26,745 
Research and development, gross4,074 3,055 15,503 10,562 
Less – royalty-bearing participation366 1,132 1,648 1,599 
Research and development, net3,708 1,923 13,855 8,963 
Sales and marketing, net2,701 2,777 11,426 10,996 
General and administrative744 1,042 3,391 4,191 
Total operating expenses7,153 5,742 28,672 24,150 
Operating income (loss)(4,603) 2,229 (3,488) 2,595 
Financial income, net481 64 1,136 389 
Income (loss) before taxes on income(4,122) 2,293 (2,352) 2,984 
Taxes on income(6) (35) (63) (83) 
Net income (loss)$(4,128) $2,258 $(2,415) $2,901 
 Basic net income (loss) per ordinary share$(0.30) $0.17 $(0.18) $0.24 
Diluted net income (loss) per ordinary share$(0.30) $0.17 $(0.18) $0.23 
 Weighted average number of ordinary shares used in computing basic net income (loss) per ordinary share13,719,649 13,050,849 13,630,793 12,039,176 
 Weighted average number of ordinary shares used in
computing diluted net income (loss) per ordinary share
13,719,649 13,339,174 13,630,793 12,351,566 


(thousands of U.S. dollars, except share and per share data)

 Three months ended
December 31,
Twelve months endedDecember 31,
 2018 2017 2018 2017
GAAP gross profit$2,550 $7,971 $25,184 $26,745
Stock-based compensation10 55 112 189
Non-GAAP gross profit$2,560 $8,026 $25,296 $26,934
 GAAP research and development, net$3,708 $1,923 $13,855 $8,963
Stock-based compensation187 134 808 473
Non-GAAP research and development, net$3,521 $1,789 $13,047 $8,490
GAAP sales and marketing, net$2,701 $2,777 $11,426 $10,996
Stock-based compensation115 105 698 499
Non-GAAP sales and marketing, net$2,586 $2,672 $10,728 $10,497
GAAP general and administrative$744 $1,042 $3,391 $4,191
Stock-based compensation101 196 503 1,055
Non-GAAP general and administrative$643 $846 $2,888 $3,136
GAAP total operating expenses$7,153 $5,742 $28,672 $24,150
Stock-based compensation403 435 2,009 2,027
Non-GAAP total operating expenses$6,750 $5,307 $26,663 $22,123
GAAP operating income (loss)$(4,603) $2,229 $(3,488) $2,595
Stock-based compensation413 490 2,121 2,216
Non-GAAP operating income (loss)$(4,190) $2,719 $(1,367) $4,811
GAAP income (loss) before taxes on income$(4,122) $2,293 $(2,352) $2,984
Stock-based compensation413 490 2,121 2,216
Non-GAAP income (loss) before taxes on income$(3,709) $2,783 $(231) $5,200
GAAP net income (loss)$(4,128) $2,258 $(2,415) $2,901
Stock-based compensation413 490 2,121 2,216
Non-GAAP net income (loss)$(3,715) $2,748 $(294) $5,117
GAAP net income (loss) per diluted share$(0.30) $0.17 $(0.18) $0.23
Stock-based compensation0.03 0.04 0.16 0.18
Non-GAAP net income (loss) per diluted share$(0.27) $0.21 $(0.02) $0.41
Weighted average number of shares used
to compute diluted net income (loss) per share
13,719,649 13,339,174 13,630,793 12,351,566

Consolidated Balance Sheets

(thousands of U.S. dollars) 

 As of December 31,2018 As of December 31,2017
Current Assets   
Cash and cash equivalents$61,988 $22,575
Restricted bank deposit 36
Short-term bank deposit 40,000
Trade receivables, net20,381 20,266
Inventories251 1,199
Other receivables1,766 2,685
Total Current Assets84,386 86,761
Severance pay fund2,967 3,052
Other long-term receivables346 172
Property and equipment, net1,832 1,924
Total Assets$89,531 $91,909
Liabilities and Shareholders’ Equity   
Current Liabilities   
Trade payables$1,559 $1,828
Deferred revenue266 2,601
Employee and payroll accruals3,420 4,062
Other payables and accrued expenses2,281 3,428
Total Current Liabilities7,526 11,919
Non-Current Liabilities   
Deferred revenue100 21
Accrued severance pay       3,425 3,573
Total Non-Current Liabilities3,525 3,594
Total Liabilities$11,051 $15,513
Shareholders’ Equity   
Share capital$643 $628
Additional paid-in capital135,730 131,491
Accumulated other comprehensive loss(2,612) (2,520)
Accumulated deficit(55,281) (53,203)
Total Shareholders’ Equity78,480 76,396
Total Liabilities and Shareholders’ Equity$89,531 $91,909

For all investor enquiries, please contact:

Investor Relations:
Miri Segal

Company Contact:
Amir Hai 

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