Allot Ltd ALLT

HOD HASHARON, Israel, Nov. 9, 2021 /PRNewswire/ -- Allot Ltd. (NASDAQ: ALLT) (TASE: ALLT), a leading global provider of innovative network intelligence and security solutions for service providers and enterprises worldwide, today announced its unaudited results for the third quarter of 2021, ended September 30, 2021.

Third Quarter 2021 Highlights

• Revenue growth of 10% YoY to $38.2 million
• Operating profit on a non-GAAP basis of $0.3 million compared to a loss of $1 million in Q3 2020
• Net loss on a non-GAAP basis reduced by 86% YoY to $0.2 million
• Signed Security as a Service deal with DISH in the US to deliver cybersecurity to their 5G customers

Financial Outlook

Management expects 2021 revenues to be between $145- 146 million and continues to expect to sign recurring security deals to be closed in 2021 with an MAR* of at least $180 million.

Management expectations of Security as a Service (SECaaS) revenues have been delayed due to delays in service launches.  Formerly forecasted SECaaS revenues levels are expected to be reached with a delay of approximately two quarters. Considering the above, management is providing the following updates to the SECaaS revenue guidance:

• For 2021, SECaaS revenues are expected to be between $4.1-4.3 million.
• SECaaS revenues in 2022 are expected to be between $10-15 million.
• SECaaS revenues for the 12 months between July 2022 and June 2023 are expected to be between $20 - $30 million.
• ARR* in December of 2021 is expected to be between $5–6 million and in December 2022 between $20–30 million. ARR measures the current annual run rate of the SECaaS revenues, which is calculated based on these expected revenues in the current month of December and multiplied by 12.

Management Comment

Erez Antebi, President & CEO of Allot, commented: "In the third quarter of 2021, we continued to execute on our plan and grow. This is our 15^th straight quarter of year over year growth, and I am very pleased with the results we achieved. Our DPI business is showing solid results as we continue to sign up new customers and grow our market share. In our cybersecurity business, we are executing on our strategy to revolutionize consumer cybersecurity, by enabling CSPs to offer consumer cybersecurity as a network service. To date, we have signed Security as a Service (SECaaS) deals with 18 different operators globally. This is a testimony that our service is proving to be highly in demand by both mobile and fixed operators throughout the world."

Continued Mr. Antebi, "In North America we are seeing very strong traction. As announced earlier this year, DISH Network Corporation (NASDAQ: DISH) selected Allot to provide end-to-end User Plane Protection (UPP) and Deep Packet Inspection (DPI) services for the company's cloud-native 5G network, and has since expanded the partnership to include cybersecurity services for DISH customers.  This deal is in addition to previously announced Security as a Service wins with mobile and fixed line operators in EMEA and APAC."

"Looking at the Security as a Service network-based cybersecurity market, I am very encouraged by what we see: our pipeline is growing and we are seeing more operator interest than ever; adoption rates of operators that launched the service with the right go-to-market are high; and the North American market is very interested in delivering consumers network-based security.  By our count, Allot is winning most of the "network-based Security as a Service" deals.  Our high win ratio is, in our opinion, because of our high value product, commercial model, marketing support and track record.  I firmly believe our strategic and financial goals with this significant growth engine are very tangible and I am confident that despite the lengthened launch process, we will meet them."

Q3 2021 Financial Results Summary

Total revenues for the third quarter of 2021 were $38.2 million, an increase of 10% compared to $34.8 million in the third quarter of 2020.

Gross profit on a GAAP basis for the third quarter of 2021 was $26.5 million (gross margin of 69.5%), compared with $23.7 million (gross margin of 68.3%) in the third quarter of 2020.

Gross profit on a non-GAAP basis for the third quarter of 2021 was $26.8 million (gross margin of 70.4%), compared with $24 million (gross margin of 69%) in the third quarter of 2020.

Net loss on a GAAP basis for the third quarter of 2021 was $3.1 million, or $0.08 loss per basic share, compared with a net loss of $2.4 million, or $0.07 loss per basic share, in the third quarter of 2020.

Net loss on a non-GAAP basis for the third quarter of 2021 was $0.2 million, or $0.00 loss per basic share compared with a non-GAAP net loss of $1.2 million, or $0.03 loss per basic share, in the third quarter of 2020.

Cash and investments as of September 30, 2021 totaled $99.2 million, compared with $99.4 million, as of December 31, 2020.

Conference Call & Webcast

The Allot management team will host a conference call to discuss the third quarter results today, November 9, 2021 at 8:30 am ET, 3:30 pm Israel time.

To access the conference call, please dial one of the following numbers:

US:  1-888-668-5032, Israel: +972-3-918-0609, UK: 0 800 917 5108

A live webcast and, following the end of the call, an archive of the conference call, will be accessible on the Allot website at: http://investors.allot.com/index.cfm   

About Allot

Allot Ltd. (NASDAQ: ALLT, TASE: ALLT) is a provider of leading innovative network intelligence and security solutions for service providers and enterprises worldwide, enhancing value to their customers. Our solutions are deployed globally for network and application analytics, traffic control and shaping, network-based security services, and more. Allot's multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises. Our industry-leading network-based Security as a Service solution has achieved over 50% penetration with some service providers and is already used by over 20 million subscribers globally.

Allot. See. Control. Secure.

For more information, visit www.allot.com

*MAR (maximum annual revenue potential of concluded transactions) was estimated by Allot upon transaction signature and constitutes an approximation of the theoretical annual revenues Allot would receive if 100% of the customer's subscribers, as estimated by Allot, signed up for the service.

*ARR: annual recurring SECaaS revenues, calculated based on revenues expected in the current month and multiplied by 12;

GAAP to Non-GAAP Reconciliation

Non-GAAP net income is defined as GAAP net income after excluding stock-based compensation expenses, amortization of acquisition-related intangible assets, deferred tax asset adjustment, exchange rate differences related to revaluation of assets and liabilities denominated in non-dollar currencies and other acquisition-related expenses.

These non-GAAP measures should be considered in addition to, and not as a substitute for, comparable GAAP measures. The non-GAAP results and a full reconciliation between GAAP and non-GAAP results is provided in the accompanying Table 2. The Company provides these non-GAAP financial measures because it believes they present a better measure of the Company's core business and management uses the non-GAAP measures internally to evaluate the Company's ongoing performance. Accordingly, the Company believes they are useful to investors in enhancing an understanding of the Company's operating performance.

Safe Harbor Statement

This release contains forward-looking statements, which express the current beliefs and expectations of Company management. Such statements involve a number of known and unknown risks and uncertainties that could cause our future results, performance or achievements to differ significantly from the results, performance or achievements set forth in such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: our ability to compete successfully with other companies offering competing technologies; the loss of one or more significant customers; consolidation of, and strategic alliances by, our competitors, government regulation; the timing of completion of key project milestones which impact the timing of our revenue recognition; lower demand for key value-added services; our ability to keep pace with advances in technology and to add new features and value-added services; managing lengthy sales cycles; operational risks associated with large projects; our dependence on fourth party channel partners for a material portion of our revenues; court approval of the Company's proposed share buy-back program; and other factors discussed under the heading "Risk Factors" in the Company's annual report on Form 20-F filed with the Securities and Exchange Commission. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made only as of the date hereof, and the company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

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SOURCE Allot Ltd.