Annual Statements Open main menu
  1. Annual Statements
  2. » Companies
  3. » Jamf Holding Corp.
  4. » Quarter Report: 2024 March (Form 10-Q)

Jamf Holding Corp. - Quarter Report: 2024 March (Form 10-Q)

             ) ))) ))       ) ) ) )      ))79 $1 — 23,912 $7,944 
38
Table of Contents
Liquidity and Capital Resources
General
As of March 31, 2024, our principal sources of liquidity were cash and cash equivalents totaling $224.5 million, which were held for general corporate purposes, which may include working capital, capital expenditures, and potential acquisitions and strategic transactions, as well as the available balance of the 2020 Revolving Credit Facility of $149.0 million. On May 3, 2024, the Company entered into the 2024 Credit Agreement to refinance the Company’s existing 2020 Revolving Credit Facility. The 2024 Credit Agreement increases our revolving credit facility from $150.0 million to $175.0 million and has a scheduled maturity date of May 3, 2029. The 2024 Credit Agreement is subject to a spring maturity date on or after June 2, 2026 in the event of certain conditions as defined in the 2024 Credit Agreement, which is filed as Exhibit 10.1 hereto and incorporated by reference herein. Our cash and cash equivalents are comprised of cash, money market deposit accounts, and money market funds with original maturities at the time of purchase of three months or less. Our cash and cash equivalents are held at a diversified portfolio of investment grade global banks and money market investments. We expect that our operating cash flows, in addition to our cash and cash equivalents, will enable us to make continued investments in supporting the growth of our business in the future.
A majority of our customers pay in advance for subscriptions and support and maintenance contracts, a portion of which is recorded as deferred revenue. Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is later recognized as revenue in accordance with our revenue recognition policy. As of March 31, 2024, we had deferred revenue of $364.5 million, of which $311.7 million was recorded as a current liability and is expected to be recognized as revenue in the next 12 months, provided all other revenue recognition criteria have been met.
As of March 31, 2024, there were no amounts outstanding under the 2020 Credit Agreement, other than $1.0 million in outstanding letters of credit. As of March 31, 2024, there was $367.6 million outstanding on our 2026 Notes, which mature on September 1, 2026. See Note 8 for additional information on our 2026 Notes.
Future Liquidity and Capital Resource Requirements
We believe our cash and cash equivalents, the 2024 Revolving Credit Facility, and cash provided by sales of our software solutions and services will be sufficient to meet our working capital and capital expenditure needs, debt service requirements for at least the next 12 months, as well as other known long-term cash requirements. Our future capital requirements will depend on many factors including our growth rate, the timing and extent of spending to support development efforts, the expansion of sales and marketing activities, the introduction of new and enhanced products and services offerings, and the continuing market acceptance of our products. In the future, we may use cash to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights.
As of March 31, 2024, our principal commitments consist of obligations under our 2026 Notes, contractual agreements for hosting services and other support software, and operating leases for office space. There have been no material changes to our commitments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.
39
Table of Contents
Cash Flows
The following table presents a summary of our condensed consolidated cash flows from operating, investing, and financing activities:
Three Months Ended March 31,
20242023
(in thousands)
Net cash used in operating activities
$(15,904)$(24,800)
Net cash used in investing activities(3,230)(1,857)
Net cash provided by financing activities280 2,517 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash(184)42 
Net decrease in cash, cash equivalents, and restricted cash(19,038)(24,098)
Cash, cash equivalents, and restricted cash, beginning of period250,809 231,921 
Cash, cash equivalents, and restricted cash, end of period$231,771 $207,823 
Cash paid for interest$314 $313 
Cash paid for purchases of equipment and leasehold improvements1,755 1,121 
Operating Activities
Our largest source of operating cash is cash collections from our subscription customers. Our primary use of cash from operating activities is employee-related expenditures, marketing expenses, and third-party hosting costs.
During the three months ended March 31, 2024, net cash used in operating activities was $15.9 million, a decrease of $8.9 million compared to the three months ended March 31, 2023. The decrease was primarily attributable to an increase in cash received from our customers and $6.0 million paid for contingent consideration in 2023, partially offset by a $7.5 million increase in cash paid for system transformation costs, $6.3 million of restructuring charges paid in the first quarter of 2024, and an increase in cash paid for third-party hosting costs.
Investing Activities
During the three months ended March 31, 2024, net cash used in investing activities was $3.2 million, an increase of $1.4 million compared to the three months ended March 31, 2023. The increase was primarily attributable to a $0.8 million increase in purchases of investments and a $0.6 million increase in purchases of equipment and leasehold improvements.
Financing Activities
During the three months ended March 31, 2024, net cash provided by financing activities was $0.3 million, a decrease of $2.2 million compared to the three months ended March 31, 2023. The decrease was primarily attributable to a $2.4 million decrease in proceeds from the exercise of stock options.
Indemnification Agreements
In the ordinary course of business, we enter into agreements of varying scope and terms pursuant to which we agree to indemnify customers, channel partners, vendors, lessors, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, services to be provided by us, or from intellectual property infringement, misappropriation, or other violation claims made by third parties. See “Risk Factors — We have indemnity provisions under our contracts with our customers, channel partners, and other third parties, which could have a material adverse effect on our business” in our Annual Report on Form 10-K for the year ended December 31, 2023. In addition, we have entered into indemnification agreements with our directors and certain officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers, or employees. No demands have been made upon us to provide indemnification under such agreements, and there are no claims that we are aware of that could have a material effect on our condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive loss, or condensed consolidated statements of cash flows.
40
Table of Contents
Critical Accounting Estimates
Our discussion and analysis of financial condition and results of operations are based upon our condensed consolidated financial statements. The preparation of our financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. We base our estimates on experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. Actual results may differ from those estimates, impacting our reported results of operations and financial condition.
There have been no material changes to our critical accounting estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023. Refer to “Note 2 — Summary of significant accounting policies” to the condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more detailed information regarding these and other accounting policies.
Recent Accounting Pronouncements
For a description of our recently adopted accounting pronouncements and recently issued accounting standards not yet adopted, see “Note 2 — Summary of significant accounting policies” to the condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Item 3.    Quantitative and Qualitative Disclosures About Market Risk
There were no material changes to our quantitative and qualitative disclosures about market risk during the three months ended March 31, 2024. See Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report on Form 10-K for the year ended December 31, 2023 for a detailed discussion of our market risks.
Item 4.    Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Exchange Act that are designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2024. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of March 31, 2024.
Changes in Internal Control
There have been no changes in internal control over financial reporting during the quarter ended March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
41
Table of Contents
PART II. OTHER INFORMATION
Item 1.    Legal Proceedings
The information set forth in “Note 7 — Commitments and contingencies” to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated herein by reference.
From time to time, we may be subject to legal proceedings and claims that arise in the ordinary course of business, including patent, commercial, product liability, employment, class action, whistleblower, and other litigation and claims, as well as governmental and other regulatory investigations and proceedings. In addition, third parties may from time to time assert claims against us in the form of letters and other communications. Although the results of these proceedings, claims, inquiries, and investigations cannot be predicted with certainty, we do not believe that the final outcome of these matters is reasonably likely to have a material adverse effect on our business, financial condition, or results of operations. Our evaluation of any current matters may change in the future as the legal proceedings and claims and events related thereto unfold. Future litigation may be necessary to defend ourselves, our partners, and our customers by determining the scope, enforceability, and validity of third-party proprietary rights, or to establish our proprietary rights. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.
Item 1A. Risk Factors
This quarterly report should be read in conjunction with the risk factors included in our Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes to the risk factors disclosed in Part 1, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023.
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3.    Defaults Upon Senior Securities
None.
Item 4.    Mine Safety Disclosures
Not applicable.
Item 5.    Other Information
Insider Trading Arrangements
During the fiscal quarter ended March 31, 2024, no director or officer of the Company or a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (in each case, as defined in Item 408 of Regulation S-K under the Exchange Act).
42
Table of Contents
Item 6.    Exhibits
The following is a list of all exhibits filed or furnished as part of this report:
Exhibit
Number
Description
3.1
3.2
10.1
31.1
31.2
32.1*
32.2*
101.INSInline XBRL Instance Document
101.SCHInline XBRL Taxonomy Extension Schema Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
101.LABInline XBRL Taxonomy Extension Label Linkbase Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
* The certifications furnished in Exhibit 32.1 and Exhibit 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.
43
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
JAMF HOLDING CORP. (Registrant)
Date: May 8, 2024By:/s/ Ian Goodkind
Ian Goodkind
Chief Financial Officer
(Principal Financial and Accounting Officer)
44

Similar companies

See also MICROSOFT CORP - Annual report 2023 (10-K 2023-06-30) Annual report 2023 (10-Q 2023-09-30)
See also ORACLE CORP - Annual report 2023 (10-K 2023-05-31) Annual report 2023 (10-Q 2023-08-31)
See also Salesforce, Inc. - Annual report 2023 (10-K 2023-01-31) Annual report 2023 (10-Q 2023-07-31)
See also ADOBE INC. - Annual report 2022 (10-K 2022-12-02) Annual report 2023 (10-Q 2023-09-01)
See also INTUIT INC. - Annual report 2023 (10-K 2023-07-31) Annual report 2023 (10-Q 2023-04-30)