Audiocodes Ltd (AUDC 1.23%)
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Q1Â 2019 Earnings Call
April 30, 2019, 8:30 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Greetings. Welcome to AudioCodes' First Quarter 2019 Earnings Conference Call. At this time all participants are in listen-only mode. A brief question and answer session will follow the formal presentation. (Operator Instruction). Please note that this conference is being recorded. I'll now turn the conference over to Rob Fink. Mr. Fink, you may now begin.
Rob Fink -- Executive Vice President and General Manager
Thank you operator. I'd like to welcome everyone to AudioCodes' first quarter 2019 earnings conference call.Hosting the call today are Shabtai Adlersberg, President Chief Executive Officer; Niran Baruch, Vice President Finance and Chief Financial Officer. Before we begin, we would like to remind you that the information provided during this call may contain forward-looking statements relating to AudioCodes' business outlook, future economic performance, product introductions and plans and objections related hereto and statements concerning assumptions made or expectations to any future events, conditions, performance or other matters are forward-looking statement as the term is defined under the U.S. federal securities law. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. These risks, uncertainties and factors include but are not limited to the effect of current global economic condition and conditions in general and in AudioCodes' industry and target markets, in particular, shift in supply and demand, market acceptance of new products and the demand for existing products, the impact of competitive products and pricing on AudioCodes and its customers products and markets, timely product and technology development, upgrade and the ability to manage changes in the market conditions as needed, possible need for additional financing, the ability to satisfy covenants in the company's loan agreements. Possible disruptions from acquisitions, the ability of AudioCodes to successfully integrate the products and operations from acquired companies into AudioCodes business and other factors detailed in AudioCodes filings with the SEC, the U.S. Securities and Exchange Commission. Audio assumes no obligation to update information. In addition during the call, AudioCodes will refer to non-GAAP net income and net income per share. AudioCodes has provided reconciliations of non-GAAP net income and net income per share to its net income and net income per share according to GAAP in the press release it issued today and on its website. Before I turn the call over to management I would like to remind everyone that this call is being recorded and an archived webcast will be made available on the Investor Relations website of the company at audiocodes.com.
With said I would now like to turn the call over to Shabtai. Shabtai, please go ahead.
Shabtai Adlersberg -- President and Chief Executive Officer
Thank you, Rob. Good morning and good afternoon everybody. I would like to welcome all to our first quarter 2019 conference call. With me this morning is Niran Baruch, the Chief Financial Officer and Vice President of Finance for AudioCodes. Niran will start-up by presenting a financial overview of the quarter. I will then review the business highlights and summary for the quarter and then discuss trends and developments in our business and the industry. We will then turn it into the Q&A session.
Niran, please go ahead.
Niran Baruch -- Chief Financial Officer
Thank you, Shabtai, and hello everyone. As usual on today's call, we will be referring to both GAAP and non-GAAP financial results. The non-GAAP P&L metrics exclude recurring non-cash items. The earnings press release that we issued earlier this morning contains a reconciliation of the supplemental non-GAAP financial information that I will be presenting today.
Revenues for the first quarter were $46.6 million, up 1.8% from the prior quarter and up 9.8% compared to the first quarter in 2018. Services revenues for the first quarter were $14.1 million, accounting for 30.3% of total revenues. Deferred revenue balance as of March 31, 2019 was $52 million compared to $49.2 million as of December 31, 2018. Revenues by geographical region for the quarter were split as follows: North America 45%, Central and Latin America 6%, EMEA 35%, and Asia Pacific 14%. Our top 15 customers in aggregate represented 63% of revenues in the quarter of which 50% are attributed to our 10 largest distributors.
Gross margin for the quarter was 62.8 % compared to 64% in Q1 2018. Non-GAAP gross margin for the quarter was 63% compared to 64.5% in Q1 2018. Operating income for the quarter was $4.5 million compared to operating income of $3 million in Q1 2018. On a non-GAAP basis, quarterly operating income was $5.5 million or 11.9% of revenues, compared to an operating income of $3.8 million in Q1 2018. Net income for the quarter was $3 million or $0.10 per share compared to net income of $2.4 million or $0.08 per share in Q1 2018. On a non-GAAP basis, quarterly net income was $5.5 million or $0.18 per share compared to net income of $3.9 million or $0.13 per share in Q1 2018. Our balance sheet to remain strong. At the end of March 2019 cash, cash equivalents, bank deposits and marketable securities totaled $68.4 million.
Day sales outstanding as of March 31, 2019 were 53 days. Operating cash flow generated during the quarter was $8.3 million. During the quarter, we acquired 86,600 of our ordinary shares for total consideration of $951,000. As of March 31, 2019 and since we began to repurchase our shares in August 2014, we had acquired an aggregate of 17.6 million shares for an aggregate consideration of approximately $95 million. In January 2019 we received court approval in Israel to purchase up to an aggregate of $12 million of additional ordinary shares pursuant to our shares repurchase order. The current court approval for share repurchases will expire on July 1, 2019.
On January 28, 2019 we declared a cash dividend of $0.11 per share. The dividend in aggregate amount of $3.2 million was paid on February 19, 2019. We intend to continue declaring semi-annual dividends in coming years.
Now to provide an update on our guidance. We now expect revenues for 2019 to be in the range of $191 million to $197 million compared to the original range of $190 million to $197 million. We anticipate non-GAAP diluted earnings per share to be in the range of $0.77 to $0.82 compared to the original range of $0.76 to $0.81. I will now turn the call back over to Shabtai.
Shabtai Adlersberg -- President and Chief Executive Officer
Thank you, Niran. We're very pleased to report solid financial results for the first quarter of 2019. Touching on the highlights of our financial performance, in revenue we grew 9.8% compared to the year ago quarter, pretty much in line with our guidance for 10% growth for overall 2019. EBITDA grew $5.9 million compared to $4.2 million in the first quarter of 2018, an increase of 40%. Same for net income which grew 40% on a year-by-year basis. And most important, we continue to improve our operational efficiency compared to the year ago quarter. Operating margin improved from 9.1% in first quarter 2018 to 11.9% in first quarter 2019. A direct result of growing revenue on a consistent basis while keeping expenses at a controllable level.
Based on performance in the first quarter of 2019 and the business outlook and activity thus far in April, we do not anticipate any change in our business trends. They should be strong the way they've been in first quarter in previous years. At this stage we continue to see strong underlying trends in both the all-IP migration market and the UCAS adoption mainly in the Microsoft Team space, that should keep the momentum in our business in coming quarters. As such we have strong confidence that 2019 is to become another strong year of growth on the heels of the previous three years of growth since 2016.
Now let's discuss some of the highlights of the business line in the first quarter of 2019. Key to our success in that quarter is the consistent progress in our networking business which grew 14.9% year-over-year to $44.5 million. The networking business now accounts for 96% of our business in this quarter. As presented in the past, the major factor supporting this growth is the strength of the UC-SIP business which grew up approximately 15% in booking year over year. We now target a revenue level of above $110 million in 2019 compared to about $93 million in 2018.
In our UC-SIP business we saw nice progress mainly in the SBC markets or our MSBR line in our One Voice Operation Center Management Suites. We also saw early signs of growth in the Microsoft Team space. At the same time we enjoyed very strong demand for our gateway business, which grew more than 20% compared to the year ago quarter. This is substantially due to the continuous evolution in the global migration of the PSTN to all-IP, while we see signs of continued trend among tier-1 service providers to migrate their networks. This migration to all-IP are generally project that span over several years, so we expect this trend to continue in coming years. In the past few months we saw three tier-1 service provider in Europe which are wrapping up their purchases with us.
As mentioned on our previous calls, key to our solid performance in this segment for several years now is the fact that we have become the partner of choice for SIPE products in many of the leading all-IP UC and the UCAS application in enterprise and service providers. We are confident that we should be able to maintain this leading position in our , you know our SIPE business in coming years.
Now let's talk about what's behind that success. This all points to one direction that's connectivity. AudioCodes has been always the leader in that space building connectivity for (inaudible) networks. So it's obvious that we enjoy good business in both the gateway and the UC-SIP lines for several quarters in a row. In order to explain the momentum we enjoyed in the last three quarters, it makes sense to take a fresh look into the combination of group business lines that falls into the category we call connectivity.
Gateways, session border controllers and MSBR are all network elements which are used to build and connect voice networks, so it makes sense to combine them all into the connectivity group. Revenues for connectivity kept growing in previous years. Just to give you some data points. In 2016 connectivity revenues were $104 million, year after that in 2017 revenue rose to $116 million, demonstrating about 10% annual growth year-over-year. In 2018, the previous year, revenue grew to $131 million growing about 14% year-over-year. When we look into the first quarter of 2019, connectivity revenues reached $37 million which represents an increase of about 20% year-over-year.
And for the full complete year of 2019, we estimate that 2019 connectivity revenue should top $150 million in the range of $150 million to $160 million providing growth of more than 15% percent on an annual level. So as you can see, we are ramping up our connectivity revenues which is substantially the majority about 75% of the company's revenues. And it's all tied up to two very strong underlying growth trends. One is the all-IP migrations, the other one is the move to digital workplace work productivity, unified communication and unified communication as a service, collaboration services are the key to the growth.
Now so far we've been discussing about the majority of our revenues, factor that we are investing heavily into new direction in the company. I'll be talking about two main efforts in the company. One which relates to our activity for migration to the cloud. At this stage the majority of the work is going toward Microsoft Azure Cloud. And second I'll be talking about our investment in Voice.AI.
Getting to our Azure Cloud Service, early April, we announced the availability for a direct route SBC on the Azure Marketplace. The SBC was deployed mid-2018 and went since then through several months of testing. We already have data from the first quarter of 2019 demonstrating an increase in the use of the direct route SBC on Azure and see nice ramp up in recent months.
Yesterday, we announced the availability for One Voice Operation Center Solution on the Azure Marketplace. As most of you know, our One Voice solution for Microsoft Skype for Business is very successful and has already contributed to tens of millions of sales in previous years. We now aim to port that success on the enterprise premises side to the enterprise cloud operation.
We now plan to migrate the complete One Voice solution for Azure. The initial targets for that will happen in mid 2019. And we're working intensively to meet that target. We believe that the availability for One Voice out of Azure will help substantially in ramping up new organization businesses project in their transition in onboarding process to new Skype for Business and Teams implementation.
Now to our second growth engine, which is the Voice.AI business. We announced that activity early 2018. Now we have two main activities in that group, one which is development of technologies internally and one that counts on the use of Voice.AI technologies and currently services of the major cloud players. So on the internal activity, we've been involved in developing speech recognition, machine learning and NLU technologies. We have been dealing mainly with a long list of projects that had to do with free speech call routing. We've been engaged in developing conversational voicebox. I'll give you a list of project we implemented immediately. We have developed transcription capabilities and also speaker identification capabilities. So very intensive, very strong investment in technology itself.
To give you some perception in what we do in the conversational voicebox. We have developed and delivered a voice-driven payment solutions for the government. We have been developing an appointment scheduling voicebox, using advanced technologies. Voice-driven journey planner for the Israeli railways, conversational ticket booking voice bot,road navigation bot and we continue to develop activity in that area. So that's activity that's based on internal investment.
At the same time, we understand that in order to be able to deliver solution and services over a long list of different languages in different parts of the world, it is important that we have access to cognitive services on the largest cloud cognitive services, namely Microsoft Azure, Amazon AWS and Google Cloud Platform. So in February 2019 we announced the Voice.AI Gateway. The Voice.AI Gateway is a flexible and scalable solution that allows integration of bots and cognitive services with private and public voice communication networks and solution. In nature the Voice.AI Gateway is a multi-cloud solution which offer integration and orchestration of multiple cloud services with all of the big names that I've mentioned before. We basically target a relatively young but growing fast market. It's the markets of the chatbots. Chatbots are growing very fast. According to several market inputs, the market is estimated -- was estimated to be lower than $1 billion in 2017 but should grow to about $3 billion in 2023. So growth rates of more than 20% a year. Now the whole idea is to enable voice access to chatbots. Our slogan is voice up your chatbot. And basically we target chatbots which are very successful and put into service to entertain customer inputs and interaction between users and services and we basically look to allow them voice access. So, we think it will be easier to access all those chatbots through voice from your phone or your desk phone rather than sit in front of a PC or so typing on a smartphone. Since the announcement back in February this year, we have many inputs from many organization.
I can point to one good example of a very large service provider that has got a very successful bot operation. It services more than 10 million of calls on a daily basis that's using a chatbot. And for them to be able to increase the level of participation is to enable voice access to a growing percentage of people interacting on an automatic basis from where it is today to a higher number, typically by 50%.
So with that I've covered the key development in our business. Just touching on some financial highlights. We've seen a very nice increase in our deferred revenues. We ended the first quarter in '19 at about $51 million. That's growing about 22% year-over-year.
Gross margin came in line with our plans and budget. Headcount was relatively stable and most important we've been able to generate cash. Cash flow from operation came at $8.3 million, which is very strong and give us confidence to the operation.
Touching on the sales front all-in-all sales performed well and according to plan across all region. We had a remarkable performance in North America and in the Western Europe markets. And all-in-all, we're very pleased we have finished above the target usually in the first quarter. Every year we target a decline of about 2% or 3% compared to the fourth quarter, exiting fourth quarter, this year we actually went above that. So with performance, again, we've been successful on three key fronts, the markets of UC and UCAS market, the contact center market and then the business services market. All in all, very successful product and sales process.
Let me touch on two key other areas in what we do. Microsoft Skype for Business is key area for us representing (inaudible) in 2018 about 40% of revenues. In the first quarter, we grew above 10% year-over-year in North America and Western Europe. We witnessed a key shift in the Microsoft focus toward Teams and collaboration which is driven substantially from the cloud and less emphasis on Skype for Business which is also on premises. Still in the first quarter of 2019 we have seen significant project and bids for Skype for Business deployments. We have two remarkable ones. One was a large bank in Europe. The other one was a large healthcare organization in the US. To support this shift, we are migrating our products run on Azure. Early April, we announced the availability for SBC on Azure. Yesterday we announced the availability for One Voice Operations Center. We do intend to migrate all of the software One Voice components no later than December of 2019.
Due to the transition to Teams we are seeing new and significant opportunities also for our User Management Pack. We're talking about organization which have tens of thousands of employees and for them the use of the UMP solution is very important and beneficial.
The shift to Teams also brings the IP phone vendors into a new level playing field. We now feel that we are you know on the same line with other companies in that. Just to remind everybody that we came late to the Skype for Business market so we do expect that in the Teams IP phone market will be among the leaders. We see significant opportunities building up our IP phones, some of which are voice multimedia. Also, we have announced a partnership with Jabra in our Device Manager now enable us to manage in combination not only our phones but also Jabra headsets which is a big advantage to end users who can now basically manage two different devices under One Management suite.
On the SBC line, we saw revenue increase nicely more than 30% year-over-year. Our target this year is to grow more than 20% from 2018. We've seen good product sales growth. We've kept growing our SBC line into the service provider market and all in all, the majority of sales in the SBC, about 80% were made into North America and EMEA. All in all, we have seen nice spread of sales to different market segments of SBCs, some into the service provider market, licensing deals, contact center deals and (inaudible) deals. So all in all, a very successful quarter for the SBC.
Last I'll touch the service provider SIFE market. Here we do see very strong growth in first quarter 2019, grew 26% year-over-year. Again, the main contribution came from three very large West European tier 1 service provider and we believe those projects will last several years going forward. So very strong. Also second quarter this quarter has got a very strong start already in those projects. So we anticipate growing this year in the service provider SIFE line above 30%.
That basically sums up my review of the business line. I'll just get back to our guidance. There was mention that as we advanced our 2019 revenue plan and met first targets, you're updating our annual guidance and stepping up the lower range by $1 million, which is now $191 million to $197 million. On the earnings side, we capitalized on the increase of 40% earnings in first quarter '19 year-over-year and therefore we now forecast an earnings range of $0.77 to $0.82.
And with that I've concluded my presentation and I'd like to move the call to the Q&A session. Operator?
Questions and Answers:
Operator
Thank you. (Operator Instructions). Thank you. Our first question is coming from the line of Rich Valera with Needham & Company. Please proceed with your question.
Richard Valera -- Needham -- Analyst
Thank you. Morning, Shabtai. You mentioned the UC-SIP bookings growth. I'm wondering if you can give the revenue growth number for the UC-SIP business in the quarter?
Shabtai Adlersberg -- President and Chief Executive Officer
We're not providing the UC-SIP. We never provide the numbers themselves on a quarterly basis, so we're not doing that way.
Richard Valera -- Needham -- Analyst
I was asking for the growth the growth rate of the UC-SIP business year-over-year?
Shabtai Adlersberg -- President and Chief Executive Officer
Year-over-year?
Richard Valera -- Needham -- Analyst
Yeah.
Shabtai Adlersberg -- President and Chief Executive Officer
So year-over-year, again, we planned for 15% to 20%.
Richard Valera -- Needham -- Analyst
Yeah. I was asking specifically in the first quarter though. Normally you give a quarterly number there.
Shabtai Adlersberg -- President and Chief Executive Officer
Okay. The booking, yeah. So booking where 15% and I think invoicing was around 10% or so.
Richard Valera -- Needham -- Analyst
Got it
Shabtai Adlersberg -- President and Chief Executive Officer
Recognizing, yeah.
Richard Valera -- Needham -- Analyst
Right. Yeah just wondering. So that business grew about 30% percent year-over-year I think for the whole year last year and I think actually in every quarter. So anything going on there? Was this just a bit of lumpiness or do we have --I think you're planning on growing that business closer to -- something close to 20% for the year. So was this just kind of a bit of lumpiness? Anything else going on in that quarter or in that business that we should think about from a growth perspective?
Shabtai Adlersberg -- President and Chief Executive Officer
Generally, no. Well,the key line in that which is which is more than 50% of that is the SBC and as I've mentioned the SBC grew more than 30% in the quarter. As I've mentioned previously in previous quarters, the transition from Skype for Business to Teams is causing some delay in customer's decision about deploying project. If you recall I told that we do expect the market to get back to the same rates we enjoyed in the past in the second half of 2019.
So what you can read into that lower than the usual revenue growth is the fact that there's still some delay in Teams project to become effectively growing. And then you know the IP phone line which is very strongly tied to the type of solution being offered as Teams project just to get out, the IP phone was a bit lower but that's about it.
Richard Valera -- Needham -- Analyst
Got it. But it sounds like you have a nice collection of Teams-specific phones, right, that should benefit as your Teams deployments pick up.
Shabtai Adlersberg -- President and Chief Executive Officer
Yes. Yeah actually I can tell you that we recently got some data from basically the end of the first quarter and then we've got obviously the new data coming in for April that shows some very significant ramp up in Teams phones. So we believe that what we've been lacking may be in January and February, we're now starting to see in March and April a very strong comeback. That's why we're not saying too much to that lower revenue in UC-SIP.
Richard Valera -- Needham -- Analyst
Got it. And if you could just talk more generally on what you see from a product and revenue perspective for a Skype for Business on-prem deployment versus a Teams sort of --Teams is inherently a cloud product, so how do you see the differences for you from a product and revenue perspective and those two different deployment scenarios?
Shabtai Adlersberg -- President and Chief Executive Officer
Okay so let's take them one by one. On Skype for Business, obviously we've been very successful and deployed many projects, some of which by the way still we continue. We do have examples of large corporations both in North America and West Europe, which being big really prefer to have an on-prem service solution, so new such wins.
Also, let's not forget that when we talked in the past about winning an account, that doesn't mean that account was purchasing 100% of its needs. I would estimate that at this stage you know all of the wins in the past are really deployed only between 20% and 40% over their need. So the fact that we kept growing and I've mentioned that we kept growing in Microsoft base in North America and Western Europe by more than 10%, it means this is a continuous expansion of networks that have been started to deploy in recent years and we do expect that thing to continue.
But as I've mentioned, Microsoft focus and I think we have also Microsoft numbers from last week, their main focus is on cloud on Azure. And in that environment Teams is the solution that's being recommended. As any new solution, it takes time for organizations to evaluate it, some part of it, by the way the collaboration part of it is very advanced. The voice part of it is still lagging, missing some capabilities. We attribute that delay in voice features and capability in Teams to the fact that we have seen some slow developments. But we've been assured and we have our own discussion that the big push, big effort to bring the missing capabilities flows into Teams. So we expect that Teams will now be growing very fast and that's evident by the numbers of the phones we sold into Teams environment. We can see clearly -- on that by the way we've got numbers also for their cloud, it seems that Teams are now starting to develop and that's a phenomenon of the past (inaudible). So the theme going forward we're going back to what we've seen previously.
Richard Valera -- Needham -- Analyst
OK. And then on the -- you mentioned you've got three large service provider deals in Europe that is ongoing projects and that they're driving a significant service provider CPE. Can you remind us what those CPE are? And it sounds like you have good visibility but just talk about the visibility on those projects you know for this year and beyond.
Shabtai Adlersberg -- President and Chief Executive Officer
Right. Well, I should remind everybody that those project were very large in nature. Each is a few millions. Usually it takes between 12 and 18 months to get selected, to agree on the missing feature to develop them, to be tested in the lab of that large tier-1 service provider. And then you know after everything is cleared then we start deployments. And this is exactly what happened. We are beyond that 12-18 months initial period. We started to deploy earlier this year. We expect the process to last between two, three or maybe even more years going forward. The products specifically are mainly gateways and MSBR. MSBR is an equivalent of an integrated access device where you have a combination of gateways with ADSL interface. And I would also tell you that due to the specific nature of design and limitation we use, we now start to see a very interesting phenomena where an MSBR that was sold, the M 500L, which is capable also to run our SBC application start to see some requirements for adding the SBC software on top of the MSBR just to enable future SIP trunk services and cognitive services and other things. So very important project and with a very nice future ahead.
Richard Valera -- Needham -- Analyst
Got it. And then if you could just talk a little bit, is there anything you can say about the Voice.AI business in terms of the size of that? I know you haven't given that number before but I think last quarter you said you expect it to double it potentially this year. Anything you can add to kind of the expectations for that business this year?
Shabtai Adlersberg -- President and Chief Executive Officer
Right. So, yeah, we've been ramping up our resources and capabilities in the past year. We saw very nice design win activity earlier this year. We now expand our operation into Europe. We do expect also, while we basically had only one language available for us last year, this year we will have more than three or four languages. By using the Voice.AI Gateway, we will be able now to increase the span of languages to tens of languages. So definitely are confident in our ability to double our revenues this year and grow further next year. We are receiving a lot of good feedback on those projects. Just an example, this week I think we are scheduled to go to air with three conversational bots in three different application, so the number is growing very nicely.
Richard Valera -- Needham -- Analyst
Got it. And then another product and you mentioned that the gateways are kind of seeing a resurgence and they were actually up 20% I believe in the first quarter which is kind of a surprise, it sounds like that's tied to these service provider projects that you referenced. So just wondering how you're thinking about that gateway business for all of 2019?
Shabtai Adlersberg -- President and Chief Executive Officer
So I'm very optimistic. You can assume that if we went up with gateways in the first quarter and because the majority of their needs came from those large service providers that we should see similar such trends. I'll note from the initial data regarding this quarter, second quarter that again we will see increase in gateways. So, all in all I think you know there was some very wrong assumption made by many people in the past that you know gateway is going away. Well, based on the numbers we have and what we can present gateways are not going anywhere for the next three, five years.
They're still with us. In the last three years you know we had flat. This year we will grow and I will not be surprised because don't forget it. (inaudible) migration now happens mainly in the U.S., Germany, other countries in Europe. Australia maybe, but, hey, we're talking about hundred countries. So many other countries and among them you can count. UK, you can count, Japan, you can count, some very large countries where the whole migration haven't started yet. So I'm confident that we will keep selling gateways for a long time.
Richard Valera -- Needham -- Analyst
Got it. And just one more for me. Noticed a $23 million operating lease showed up on the balance sheet. Can you talk about what that is?
Shabtai Adlersberg -- President and Chief Executive Officer
Sure.
Niran Baruch -- Chief Financial Officer
Hi. This is Niran. As of January 2018 we implemented the new GAAP standard ASC 842. This new standard required us to record operating lease write off assets and operating lease liabilities for all operating leases with a duration longer than 12 months. The implementation of this standard result the write off asset and the write off operating lease liabilities of approximately $31 million.
Richard Valera -- Needham -- Analyst
Got it. That makes sense. Thanks very much, gentlemen.
Operator
As a reminder. [Operator Instruction]. Thank you. I'd like to turn the call to back to Shabtai for closing remarks.
Shabtai Adlersberg -- President and Chief Executive Officer
Okay. Thank you very much operator. I'd like to thank everyone who attended our conference call today with continued good business momentum and execution in the beginning of 2019. We believe we are on track to achieve another year of growth for our business. We look forward to your participation in our next quarterly conference call. Thank you very much. Have a nice day. Bye-bye.
Operator
This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.
Duration: 42 minutes
Call participants:
Rob Fink -- Executive Vice President and General Manager
Shabtai Adlersberg -- President and Chief Executive Officer
Niran Baruch -- Chief Financial Officer
Richard Valera -- Needham -- Analyst
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