Check Point Software Technologies Ltd.

Greetings and welcome to the Check Point Software first quarter 2019 conference call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kip Meintzer, Head of Global Investor Relations for Check Point Software. Please go ahead, sir.

Thank you. I'd like to thank all of you for joining us today to discuss Check Point's first quarter 2019 financial results. Joining me today on the call are Gil Shwed, founder and CEO, along with our CFO and COO, Tal Payne. As a reminder, this call is webcast live on our website and is recorded for replay. To access the live webcast and replay information, please visit the company's website at CheckPoint.com. For your convenience, the conference call replay will be available through April 26th. If you'd like to reach us after the call, please contact Investor Relations by email at kip.checkpoint.com. Before we begin with management's presentation, I'd like to highlight the following. During the course of this presentation, checkpoint representatives may make certain forward-looking statements. These forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934 include, but are not limited to, statements related to checkpoints Expectations regarding business, financial performance, and customers, the introduction of new products, programs, and the success of those products and programs, the environment for security threats and trends in the market, our strategy and focus areas, demand for our solutions, our business and financial outlook, including our guidance for Q2 2019. Because these statements pertain to future events that are subject to various risks and uncertainties, actual results could differ materially from Check Point's current expectations and beliefs. Factors that could cause or contribute to such differences are contained in CheckPoint's earnings release issued on April 18, 2019, which is available on our web website, and other factors and risks, including those discussed in CheckPoint's annual report on Form 20F for the year ending December 31, 2017, which is on file with the Securities and Exchange Commission. CheckTechPoint assumes no obligation to update information concerning its expectations or beliefs, except as required by law. In our press release, which has been posted on our website, we present GAAP and non-GAAP results, along with a reconciliation of such results, as well as reasons for our representation of the non-GAAP information. Now I'd like to turn the call over to Tal Payne for a review of the financial results.

Thank you, Kip. Good morning and good afternoon to everyone joining us on the call today. I'm pleased to begin the review of the first quarter. Revenues for the quarter increased by 4% year-over-year to $472 million, and our non-GAAP EPS grew by 2% to $1.32, both slightly above the mid of our guidance. Before I proceed further into the numbers, let me remind you that our GAAP financial results include stock-based compensation charges, amortization of acquired intangible assets and acquisition-related expenses, as well as the related tax effects. Keep in mind that as applicable, non-GAAP information is presented excluding these items. Now let's take a look at the financial highlights for the quarter. Product and security subscription revenues were $257 million. Our subscription revenues continue to be strong with 13% growth year-over-year, reaching $144 million. Our software-updated maintenance revenues increased to $215 million, representing 4% growth year-over-year. The growth in our subscription revenues is driven by our advanced solutions, mainly cloud, sampler zero-day threat prevention, and mobile. Infinity consolidated solutions also started to flow into the revenues and show nice trends. During the quarter, we had Infinity Deals in a variety of industries including finance, manufacturing, software and defense, with a significant portion coming from new customers. We continue to see an increase in customers' annual run rates in Infinity Deals, ranging from tens to hundreds of percentage increase, which is a great result. From an accounting perspective, a small portion of the deals is recognized as product revenues, while majority of the deals is recognized as recurring revenues over the life of the contract. Majority as subscription and the remainder as support, update and maintenance. Deferred revenues as of March 31st, 2019 reached $1,312,000,000, a growth of $146,000,000 or 13% over March 31st, 2018. Revenue distribution by geography for the quarter was as follows. 45% of revenues came from Americas, 44% of revenues came from Europe, Middle East and Africa region, and the remaining 11% came from Asia Pacific. Please note, since the beginning of 2019, Middle East and Africa are part of Europe region, while before it was part of Asia Pacific region. The revenue distribution by geography for Q1 last year after the reclassification would have been 47% of revenues from Americas, no change, 42% of revenues came from Europe, Middle East and Africa region after the reclass and the remaining 11% came from Asia Pacific. Those were the numbers for Q1 last year after the reclass. From a deal size perspective, This quarter we had 47 customers with transactions over $1 million, compared to 44 in Q1 2018. Transactions greater than $50,000 were 71% of total order value, similar to last year. Non-GAAP operating margins for the quarter were 50%, as we planned, We continue to invest in our sales force and marketing in order to execute our strategy which revolves around prevention, management, and consolidation of security. In addition, this quarter includes the full effect of our recent acquisitions, both of Dom9 and Forsnok. Our financial income for the quarter reached $19 million. The increase is in line with the higher interest rate levels in the U.S. Financial income expected to be around 20-21 million dollars a quarter in the remainder of the year. Effective non-GAAP tax rate for this quarter was 19%, as planned again. Please note, in the fourth quarter we expect the tax rate to be around zero as a lapse of statute of limitations expected to occur by year end. GAAP net income for the first quarter of 2019 was 180 million dollars. or $1.15 per diluted share. Non-GAAP net income was $205 million or $1.32 per diluted share, an increase of 2% from the first quarter of 2018 and 1 cent above the midpoint of our guidance. Our cash balance as of March 31st was $4.2 billion compared to $4 billion in December 31st, 2018. Operating cash flow, were $379 million, which includes part of Forsnok acquisition payment of $2 million. Collections continue to be very strong. During Q1 last year, we had a $45 million tax refund. Excluding this item, our operating cash flow increased by 2%. During the quarter, we purchased 2.7 million shares, for $305 million, at an average price of $115 a share. This quarter, we implemented a new accounting standard, ASC 842, which changed the recording of long-term operating leases in the financials. Accordingly, we recorded assets of $30 million against liabilities, reflecting the value of these leases. There's no significant impact on the income statement. Now let's turn the call over to Gil for his comments.