MIME 2017 Annual Report

35 Year Ended March 31, 2018 2017 2016 2015 2014 (dollars in thousands) Supplemental Financial and Other Data: Revenue constant currency growth rate (3) 38% 39% 30% 33% 37% Revenue retention rate (4) 110% 111% 109% 107% 105% Total customers (5) 30,400 26,400 18,000 13,800 10,300 Adjusted EBITDA (6) $ 25,752 $ 11,802 $ 15,839 $ 14,227 $ (1,170) (1) Share-based compensation expense included in these line items was as follows: Year Ended March 31, 2018 2017 2016 2015 2014 (in thousands) Cost of revenue $ 1,053 $ 1,353 $ 633 $ 151 $ 151 Research and development 2,555 1,873 1,711 544 291 Sales and marketing 4,477 4,719 3,180 1,684 395 General and administrative 3,649 2,349 2,362 3,047 395 Total share-based compensation expense $ 11,734 $ 10,294 $ 7,886 $ 5,426 $ 1,232 (2) Basic and diluted net (loss) income per share applicable to ordinary shareholders is computed based on the weighted-average number of ordinary shares outstanding during each period. For additional information, see Note 2 to the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. (3) In order to determine how our business performed exclusive of the effect of foreign currency fluctuations, we compare the percentage change in our revenue from one period to another using a constant currency. To determine the revenue constant currency growth rate for each period, revenue from entities reporting in foreign currencies was translated into U.S. dollars using the comparable prior period’s foreign currency exchange rates. For example, the average rates in effect for the fiscal year ended March 31, 2017 were used to convert revenue for the year ended March 31, 2018 and the revenue for the comparable prior period ended March 31, 2017, rather than the actual exchange rates in effect during the respective period. Revenue constant currency growth rate is a non-GAAP financial measure. A reconciliation of this non-GAAP measure to its most directly comparable U.S. GAAP measure for the respective periods can be found in the table below. Year Ended March 31, 2018 2017 2016 2015 2014 (dollars in thousands) Reconciliation of Revenue Constant Currency Growth Rate: Revenue, as reported $ 261,897 $ 186,563 $ 141,841 $ 116,085 $ 88,315 Revenue year-over-year growth rate, as reported 40% 32% 22% 31% 32% Estimated impact of foreign currency fluctuations (2)% 7% 8% 2% 5% Revenue constant currency growth rate 38% 39% 30% 33% 37% The impact of foreign exchange rates is highly variable and difficult to predict. We use revenue constant currency growth rate to show the impact from foreign exchange rates on the current period revenue growth rate compared to the prior period revenue growth rate using the prior period’s foreign exchange rates. In order to properly understand the underlying business trends and performance of our ongoing operations, we believe that investors may find it useful to consider the impact of excluding changes in foreign exchange rates from our revenue growth rate. We believe that presenting this non-GAAP financial measure in this Annual Report on Form 10-K provides investors greater transparency to the information used by our management for financial and operational decision-making and allows investors to see our results “through the eyes” of management. We also believe that providing this information better enables our investors to understand our operating performance and evaluate the methodology used by management to evaluate and measure such performance.