INAP Reports First Quarter 2018 Financial Results

Internap Corporation (NASDAQ:INAP), a leading provider high-performance data center services including colocation, cloud and network announced its financial for the first quarter of 2018.

INAP reported revenue of $74.2 million up 5.9 percent from previous quarter and 2.9 percent year-over-year. The company said that the GAAP net loss was at $14.1 million.

As quoted in the press release:

“INAP continues to perform by improving operations and focusing on our core strengths in data center services,” stated Peter D. Aquino, President and CEO.  “As we layer on value-added products, such as advanced managed services through our SingleHop acquisition, we expect our customers to benefit by the integrated solution sets we offer them in Tier 1 markets, where addressable market demand for our services allows us to capture additional share. Our new sales team now has momentum that we can build on and expand our product set across our entire platform, providing a path toward a combination of organic and acquisition growth.”

Revenue

First quarter 2018 results include SingleHop operations as of March 1, 2018, and are therefore not comparable to prior periods.

• Revenue totaled $74.2 million in the first quarter of 2018, an increase of $4.2 million or 5.9% sequentially and 2.9% year over year. The sequential increase was primarily due to the SingleHop acquisition.  Base line revenues remain generally flat sequentially, including the impact of announced planned closures.

In 2018, with the inclusion of SingleHop, INAP moved to a geographic organizational structure to better align global data center assets with management and increase sales efficiency. Beginning with first quarter 2018 reporting, INAP redefined its segment reporting into: INAP US, and INAP INTL.

• INAP US revenue totaled $57.1 million in the first quarter of 2018, an increase of 7.2% sequentially and 2.9% year over year. The sequential increase was driven by SingleHop, a full quarter of INAP’s new Atlanta Data Center, and the stabilization of US revenue.
• INAP INTL revenue totaled $17.1 million in the first quarter of 2018, an increase of 1.9% sequentially and 2.7% year over year. The sequential increase was contributed by SingleHop operations in Europe, while the year over year increase is due to both consolidation of INAP Japan, and SingleHop.  Post consolidation at the end of 2017, INAP Japan contributes $2 million per quarter in revenue.

First Quarter 2018 Financial Summary

($ in thousands)	QoQ		YoY
1Q 2018			4Q 2017			1Q 2017			Growth		Growth
Total Revenue	$	74,201	$	70,035	$	72,133	5.9	%	2.9	%
Operating Costs and Expenses	$	73,322	$	64,432	$	71,641	13.8	%	2.3	%
Depreciation and Amortization	$	21,077	$	17,397	$	17,745	21.2	%	18.8	%
Acquisition Costs	$	2,558	$	176	$	—	—		—
All Other Operating Costs and Expenses	$	49,687	$	46,859	$	53,896	6.0	%	(7.8	)%
GAAP Net Loss Attributable to INAP Shareholders	$	(14,060	)	$	(6,934	)	$	(8,230	)	(102.8	)%	(70.8	)%
GAAP Net Loss Margin	(18.9		)%	(9.9		)%	(11.4		)%
Minus Goodwill Impairment and Other Items	$	3,701	$	1,393	$	3,414	165.7	%	8.4	%
Normalized Net Loss2	$	(10,359	)	$	(5,541	)	$	(4,816	)	(87.0	)%	(115.1	)%
Adjusted EBITDA1	$	25,665	$	24,363	$	21,554	5.3	%	19.1	%
Adjusted EBITDA Margin1	34.6		%	34.8		%	29.9		%
Capital Expenditures (CapEx)	$	6,359	$	12,616	$	5,989	(49.6	)%	6.2	%
Adjusted EBITDA less CapEx1	$	19,306	$	11,747	$	15,565	64.3	%	24.0	%

Click here for the full text release.