- the annualized value of maintenance and subscription lease contracts with start dates or anniversary dates during the period, plus
- the value of perpetual license contracts with start dates during the period, plus
- the annualized value of fixed-term services contracts with start dates or anniversary dates during the period, plus
- the value of work performed during the period on fixed-deliverable services contracts.
When we refer to the anniversary dates in the definition of ACV above, we are referencing the date of the beginning of the next twelve-month period in a contractually committed multi-year contract. If a contract is three years in duration, with a start date of July 1, 2022, the anniversary dates would be July 1, 2023 and July 1, 2024. We label these anniversary dates as they are contractually committed. While this contract would be up for renewal on July 1, 2025, our ACV performance metric does not assume any contract renewals.
Example 1: For purposes of calculating ACV, a $100,000 subscription lease contract or a $100,000 maintenance contract with a term of July 1, 2022 – June 30, 2023, would each contribute $100,000 to ACV for fiscal year 2022 with no contribution to ACV for fiscal year 2023.
Example 2: For purposes of calculating ACV, a $300,000 subscription lease contract or a $300,000 maintenance contract with a term of July 1, 2022 – June 30, 2025, would each contribute $100,000 to ACV in each of fiscal years 2022, 2023 and 2024. There would be no contribution to ACV for fiscal year 2025 as each period captures the full annual value upon the anniversary date.
Example 3: A perpetual license valued at $200,000 with a contract start date of March 1, 2022 would contribute $200,000 to ACV in fiscal year 2022.
/ Management's 2023 Financial Outlook
The Company's first quarter and FY 2023 revenue, diluted earnings per share and ACV guidance is provided below. The Company is also providing its FY 2023 guidance for operating cash flows and unlevered operating cash flow. The revenue and diluted earnings per share guidance is provided on both a GAAP and non-GAAP basis. Non-GAAP financial measures exclude the income statement effects of the acquisition accounting adjustments to deferred revenue from business combinations closed prior to 2022, stock-based compensation, excess payroll taxes related to stock-based compensation, amortization of acquired intangible assets, expenses related to business combinations and adjustments for the income tax effect of the excluded items.
This guidance is based on the Company's evaluation of factual information it has determined to be relevant and the application of certain assumptions made by the Company. Please refer to the Company's prepared remarks document for additional information regarding the Company's financial guidance, including its assumptions regarding overall business dynamics.
/ First Quarter 2023 Guidance
The Company currently expects the following for the quarter ending March 31, 2023:
| (in millions, except percentages and per share data) | GAAP | Non-GAAP | |
| Revenue | $ 482.5 - $ 507.5 | $ 482.5 - $ 507.5 | |
| Revenue Growth Rate | 13.5 % - 19.4 % | 12.6 % - 18.4 % | |
| Revenue Growth Rate — Constant Currency | 15.7 % - 21.9 % | 14.7 % - 20.9 % | |
| Diluted earnings per share | $ 0.78 - $ 1.01 | $ 1.53 - $ 1.71 |
| (in millions, except percentages) | Other Financial Metrics |
| ACV | $ 380.0 - $ 400.0 |
| ACV Growth Rate | 10.4 % - 16.2 % |
| ACV Growth Rate — Constant Currency | 12.4 % - 18.6 % |
/ Fiscal Year 2023 Guidance
The Company currently expects the following for the fiscal year ending December 31, 2023:
| (in millions, except percentages and per share data) | GAAP | Non-GAAP | |
| Revenue | $ 2,242.0 - $ 2,322.0 | $ 2,242.0 - $ 2,322.0 | |
| Revenue Growth Rate | 8.5 % - 12.4 % | 8.2 % - 12.0 % | |
| Revenue Growth Rate — Constant Currency | 7.2 % - 11.2 % | 6.9 % - 10.8 % | |
| Diluted earnings per share | $ 5.38 - $ 6.06 | $ 8.34 - $ 8.86 |
