Industry Summary Articles

Third Quarter 2019 Financial Summary

Third quarter 2019 GAAP revenue of $783.9 million was down 1 percent as compared to the third quarter of 2018. Third quarter 2019 non-GAAP revenue of $784.3 million was down 3 percent as compared to the third quarter of 2018.

Buildings and Infrastructure revenue was $309.8 million, up 5 percent. Geospatial revenue was $155.1 million, down 16 percent. Resources and Utilities revenue was $121.1 million, down 9 percent. Transportation revenue was $198.3 million, up 4 percent. Segment revenues reflect the results of Trimble's reportable segments under its management reporting system and are non-GAAP measures.

GAAP operating income was $91.7 million, up 18 percent as compared to the third quarter of 2018. GAAP operating margin was 11.7 percent of revenue as compared to 9.7 percent of revenue in the third quarter of 2018.

GAAP net income was $78.1 million, up 6 percent as compared to the third quarter of 2018. GAAP diluted earnings per share were $0.31 as compared to GAAP diluted earnings per share of $0.29 in the third quarter of 2018.

Non-GAAP operating income of $162.0 million was down 3 percent as compared to the third quarter of 2018. Non-GAAP operating margin was 20.7 percent of revenue as compared to 20.8 percent of revenue in the third quarter of 2018.

Non-GAAP net income of $121.1 million was down 3 percent as compared to the third quarter of 2018. Non-GAAP diluted earnings per share were $0.48 as compared to non-GAAP diluted earnings per share of $0.49 in the third quarter of 2018.

The GAAP tax rate for the quarter was an expense of 1 percent as compared to a benefit of 15 percent in the third quarter of 2018, and the non-GAAP tax rate was both 19 percent in the third quarter of 2019 and 2018.

Operating cash flow for the first three quarters of 2019 was $462.8 million, up 20 percent as compared to the first three quarters of 2018. Deferred revenue for the third quarter of 2019 was $419.0 million, up 15 percent as compared to the third quarter of 2018.

During the third quarter, Trimble repurchased approximately 3.3 million shares of its common stock for $121 million, and year to date has repurchased approximately 4.7 million shares for $180 million. Approximately $172 million remains under the current share repurchase authorization as of the end of the third quarter.

"Our third quarter revenue reflected prevailing market uncertainties, while earnings per share and cash flow exceeded expectations," said Steven W. Berglund, Trimble's president and chief executive officer. "Although we anticipate market ambiguities to persist for the remainder of the year, we demonstrated the ability to control costs while continuing the transformation of our business model towards recurring revenue."

Forward Looking Guidance

For the fourth quarter of 2019, Trimble expects to report GAAP revenue between $768 million and $798 million and GAAP earnings per share of $0.20 to $0.24, and non-GAAP revenue between $770 million and $800 million and non-GAAP earnings per share of $0.46 to $0.50. GAAP guidance assumes a tax rate of 19 percent and non-GAAP guidance assumes a tax rate of 19 percent. Both GAAP and non-GAAP earnings per share assume approximately 252 million shares outstanding. For the fiscal year of 2019, Trimble expects to report GAAP revenue between $3.209 billion and $3.239 billion and GAAP earnings per share of $1.08 to $1.13, and non-GAAP revenue between $3.215 billion and $3.245 billion and non-GAAP earnings per share of $1.91 to $1.95. GAAP guidance assumes a tax rate of 14 percent and non-GAAP guidance assumes a tax rate of 19.5 percent. Both GAAP and non-GAAP earnings per share assume approximately 253 million shares outstanding. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures and other information relating to these non-GAAP measures are included in the supplemental reconciliation schedule attached.

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