MIME 2017 Annual Report

43 We have operations in jurisdictions other than the United States and generate revenue and incur expenditures in currencies other than the U.S. dollar. The following information shows the effect on certain components of our consolidated statements of operations data for each of the periods indicated based on a 10% increase or decrease in foreign currency exchange rates assuming that all foreign currency exchange rates move in the same directions at the same time: Year ended March 31, 2018 2017 2016 (in millions) Cost of Revenue $ 4.0 $ 2.9 $ 2.5 Research and development 3.0 2.0 1.6 Sales and marketing 4.9 3.7 3.0 General and administrative 1.1 0.8 0.8 Comparison of Years Ended March 31, 2018 and 2017 Revenue Year ended March 31, Period-to-period change 2018 2017 Amount % Change (dollars in thousands) Revenue $ 261,897 $ 186,563 $ 75,334 40% Revenue increased $75.3 million in the year ended March 31, 2018 compared to the year ended March 31, 2017. The increase in revenue was primarily attributable to increases in new customers, including the 4,000 new customers added since March 31, 2017, a full year of revenue related to new customers added during fiscal 2017 and additional revenue from customers that existed as of March 31, 2017. Revenue for the year ended March 31, 2018 compared to the year ended March 31, 2017 was positively impacted by approximately $4.7 million primarily as a result of the weakening of the U.S. dollar relative to the South African rand and to a lesser extent the British pound. Cost of revenue Year ended March 31, Period-to-period change 2018 2017 Amount % Change (dollars in thousands) Cost of revenue $ 69,699 $ 50,314 $ 19,385 39% Cost of revenue increased $19.4 million in the year ended March 31, 2018 compared to the year ended March 31, 2017, which was primarily attributable to increases in personnel-related costs of $5.8 million, data center costs of $5.4 million, depreciation expense of $3.9 million, information technology and facility costs of $1.9 million, amortization of intangibles of $1.4 million and professional services costs of $0.8 million. Cost of revenue for the year ended March 31, 2018 compared to the year ended March 31, 2017 was negatively impacted by approximately $1.1 million primarily as a result of the weakening of the U.S. dollar relative to the South African rand and British pound. Personnel-related cost increased primarily as a result of salaries and benefits associated with increased headcount, data center costs increased as a result of the increase in our customer base, and depreciation increased primarily as a result of increased capital expenditures in support of our expanding infrastructure. In addition, the increase in information technology and facility costs is primarily a result of increased headcount and the increase in amortization of intangibles is primarily as a result of amortization of capitalized software. As a result of changes in foreign exchange rates, gross profit increased in absolute dollars by approximately $3.6 million for the year ended March 31, 2018 as compared to the year ended March 31, 2017.