CyberArk Software (NASDAQ:CYBR) reported third-quarter financial results on Nov. 7. The Israel-based cybersecurity provider is enjoying robust demand for its privileged account security solutions, which help organizations protect the most vital areas of their IT infrastructure from insider threats.

CyberArk Software results: The raw numbers

Metric

Q3 2018

Q3 2017

Year-Over-Year Change

Revenue

$84.7 million

$64.8 million

31%

Adjusted net income

$17.8 million

$8.9 million

100%

Adjusted EPS

$0.48

$0.25

92%

Data source: CyberArk Software Q3 2018 earnings press release. Chart by author. EPS = earnings per share.

What happened with CyberArk Software this quarter?

Total revenue jumped 31% to $84.7 million, driven by a 29% rise in license revenue, to $46.1 million, and a 33% increase in maintenance and professional services revenue, to $38.5 million.

"Our strong results reflect our success executing our growth strategy across sales and marketing as well as delivering innovative solutions that help strengthen customers' overall security posture on premises, in the cloud, and across the DevOps pipeline," Chairman and CEO Udi Mokady said in a press release.

CyberArk added nearly 200 customers in the third quarter, bringing its total customer count to more than 4,200 businesses. CyberArk now provides cybersecurity solutions to 50% of the Fortune 500 -- the 500 largest U.S. corporations by revenue. 

A digital illustration of a lock

More businesses are turning to CyberArk for their cybersecurity needs. Image source: Getty Images.

During a conference call with analysts, Mokady highlighted three key trends that are fueling CyberArk's growth:

First, awareness and demand for privileged access security is stronger than ever and accelerating across all geographies. Second, securing privileged access is recognized as critical to the successful execution of digital transformation and cloud migration strategies. And third, chief information security officers are solving increasingly complex regulatory challenges by focusing on securing the environment and not merely checking a compliance box. Given our leadership position and the breadth of our solutions, we benefited from these macro trends in the third quarter.

Better still, CyberArk is becoming more profitable as it expands. Non-GAAP operating income -- which excludes share-based compensation and acquisition-related items -- surged 97% to $21 million. And non-GAAP net income soared 100% to $17.8 million, or $0.48 per share.

Looking forward

Based on these results and current sales trends, CyberArk boosted its full-year guidance. The company now expects:

  • Total revenue of $328.9 million to $330.4 million, representing year-over-year growth of 26%, and up from a previous forecast of $320 million to $324 million 
  • Non-GAAP operating income of $78 million to $79.2 million, up from $64 million to $67 million
  • Non-GAAP earnings per share of $1.75 to $1.77, up from $1.43 to $1.50

Mokady said that CyberArk is well positioned to capture additional market share in the years ahead.

"The market for privileged access security is rich with opportunity. ... Our execution in the first nine months of this year has established a strong foundation to continue to responsibly invest in the business and deliver growth in the fourth quarter and beyond," Mokady said. 

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool recommends CyberArk Software. The Motley Fool has a disclosure policy.