VARONIS SYSTEMS INC (VRNS) saw its loss narrow to $4.39 million, or $0.17 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $4.92 million, or $0.19 a share. On the other hand, adjusted net loss for the quarter narrowed to $0.88 million, or $0.03 a share from a loss of $2.55 million or $0.10 a share, a year ago.

Revenue during the quarter surged 31.05 percent to $40.94 million from $31.24 million in the previous year period. Gross margin for the quarter contracted 31 basis points over the previous year period to 89.95 percent. Operating margin for the quarter stood at negative 9.60 percent as compared to a negative 14.55 percent for the previous year period.

Operating loss for the quarter was $3.93 million, compared with an operating loss of $4.54 million in the previous year period.

However, the adjusted operating loss for the quarter stood at $0.42 million compared to operating loss of $2.17 million in prior year period.

Yaki Faitelson, Varonis chief executive officer, said, "We delivered a strong third quarter. For the fourth quarter in a row, both license and total revenues grew by more than 30% year over year. We exceeded our guidance on both the top and bottom lines, and our efforts to reach enterprises with 1,000 or more employees and a larger total customer lifetime value are also paying off. Demand for our solutions increased, and we are encouraged by the positive momentum we see in the business driven by growing awareness of the insider threat and Varonis’ role in protecting data. Customers are recognizing that our software provides better protections around data and enables better control of access so companies can discover where their information assets are, track and profile those who use them, spot who may be abusing them, and identify those who are responsible for them."

For the fourth-quarter, Varonis Systems Inc expects revenue to be in the range of $52.50 million to $54 million. It expects adjusted operating income to be in the range of $6.30 million to $6.70 million.  On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.20 to $0.21. 

For fiscal year 2016, Varonis Systems Inc expects revenue to be in the range of $162.50 million to $164 million.  It expects adjusted operating loss to be in the range of $4.40 million to $4 million. The company projects diluted loss per share to be in the range of $0.22 to $0.21 on adjusted basis.

The company has spent $15.89 million cash to meet investing activities during the nine month period as against cash outgo of $3.68 million in the last year period.

Cash flow from financing activities was $3.80 million for the nine month period, up 130.90 percent or $2.16 million, when compared with the last year period.

Cash and cash equivalents stood at $41.69 million as on Sep. 30, 2016, down 40.38 percent or $28.24 million from $69.93 million on Sep. 30, 2015.

Working capital decreases marginally
Varonis Systems Inc has witnessed a decline in the working capital over the last year. It stood at $76.52 million as at Sep. 30, 2016, down 4.49 percent or $3.59 million from $80.12 million on Sep. 30, 2015. Current ratio was at 2.10 as on Sep. 30, 2016, down from 2.43 on Sep. 30, 2015.

Days sales outstanding went down to 66 days for the quarter compared with 84 days for the same period last year.

At the same time, days payable outstanding went down to 39 days for the quarter from 73 for the same period last year.