Cardlytics Announces First Quarter 2021 Financial Results

Rhea-AI Summary

Cardlytics, Inc. (NASDAQ: CDLX) reported Q1 2021 revenue of $53.2 million, up 17% year-over-year. Billings reached $76.3 million, a 13% increase, and gross profit rose 22% to $19.5 million. Despite these gains, the company recorded a net loss of $(24.9) million, or $(0.85) per diluted share. Monthly Active Users (MAUs) increased to 168.6 million, a 20% growth. Cardlytics anticipates Q2 2021 revenue between $58.0 million and $65.0 million and full-year guidance of $260.0 million to $285.0 million.

Positive

• Revenue increased by 17% year-over-year to $53.2 million.
• Billings rose 13% year-over-year to $76.3 million.
• Gross profit increased by 22% to $19.5 million.
• Monthly Active Users grew 20% to 168.6 million.

Negative

• Net loss widened to $(24.9) million from $(13.5) million year-over-year.
• Non-GAAP net loss increased to $(9.9) million from $(7.0) million year-over-year.

ATLANTA, May 04, 2021 (GLOBE NEWSWIRE) -- Cardlytics, Inc. (NASDAQ: CDLX), an advertising platform in banks' digital channels, today announced financial results for the first quarter ended March 31, 2021. Supplemental information is available on the Investor Relations section of the Cardlytics' website at http://ir.cardlytics.com/.

“We had a strong start to the year with Q1 billings and revenue exceeding our expectations. Our results reflect a continued positive trajectory in our business,” said Lynne Laube, CEO & Co-Founder of Cardlytics. “The Dosh acquisition is already proving out our acquisition thesis and we believe the upcoming Bridg acquisition has the potential to be transformational given its technology and unique position in the CDP market."

“We are extremely pleased with our results in Q1, which marked our return to year-over-year growth,” said Andy Christiansen, CFO of Cardlytics. “Our legacy business is strong and has a lot of momentum, and the acquisitions of Dosh and Bridg will not only sustain that momentum for years to come, but will also open up new avenues for future growth.”

First Quarter 2021 Financial Results

• Revenue was $53.2 million, an increase of 17% year-over-year, compared to $45.5 million in the first quarter of 2020.
• Billings, a non-GAAP metric, was $76.3 million, an increase of 13% year-over-year, compared to $67.8 million in the first quarter of 2020.
• Gross profit was $19.5 million, an increase of 22% year-over-year, compared to $16.0 million in the first quarter of 2020.
• Adjusted contribution, a non-GAAP metric, was $24.3 million, an increase of 19% year-over-year, compared to $20.4 million in the first quarter of 2020.
• Net loss attributable to common stockholders was $(24.9) million, or $(0.85) per diluted share, based on 29.3 million weighted-average common shares outstanding, compared to a net loss attributable to common stockholders of $(13.5) million, or $(0.51) per diluted share, based on 26.7 million weighted-average common shares outstanding in the first quarter of 2020.
• Non-GAAP net loss was $(9.9) million, or $(0.34) per diluted share, based on 29.3 million weighted-average common shares outstanding, compared to a non-GAAP net loss of $(7.0) million, or $(0.26) per diluted share, based on 26.7 million weighted-average common shares outstanding in the first quarter of 2020.
• Adjusted EBITDA, a non-GAAP metric, was a loss of $(3.9) million compared to a loss of $(4.0) million in the first quarter of 2020.
  

Key Metrics

• MAUs were 168.6 million, an increase of 20%, compared to 140.8 million in the first quarter of 2020.
• ARPU was $0.32 in the first quarter of both 2020 and 2021.

Definitions of MAUs and ARPU are included below under the caption “Non-GAAP Measures and Other Performance Metrics.”

Second Quarter and Full Year 2021 Financial Expectations

Cardlytics anticipates billings, revenue, and adjusted contribution to be in the following ranges (in millions):

	Q2 2021 Guidance		FY 2021 Guidance
Billings(1)	$85.0 - $95.0		$380.0 - $420.0
Revenue	$58.0 - $65.0		$260.0 - $285.0
Adjusted contribution(2)	$26.0 - $30.0		$117.5 - $132.5

(1)	A reconciliation of billings to GAAP revenue on a forward-looking basis is presented below under the heading "Reconciliation of Forecasted GAAP Revenue to Billings."
(2)	A reconciliation of adjusted contribution to GAAP gross profit on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure.

Earnings Teleconference Information

Cardlytics will discuss its first quarter 2021 financial results during a teleconference today, May 4, 2021, at 5:00 PM ET / 2:00 PM PT. The conference call can be accessed at (877) 407-3982 (domestic) or (201) 493-6780 (international), conference ID# 13719188. A replay of the conference call will be available through 8:00 PM ET / 5:00 PM PT on May 11, 2021 at (844) 512-2921 (domestic) or (412) 317-6671 (international). The replay passcode is 13719188. The call will also be broadcast simultaneously at http://ir.cardlytics.com/. Following the completion of the call, a recorded replay of the webcast will be available on Cardlytics’ website.

About Cardlytics

Cardlytics (NASDAQ: CDLX) is a digital advertising platform. We partner with financial institutions to run their banking rewards programs that promote customer loyalty and deepen banking relationships. In turn, we have a secure view into where and when consumers are spending their money. We use these insights to help marketers identify, reach, and influence likely buyers at scale, as well as measure the true sales impact of marketing campaigns. Headquartered in Atlanta, Cardlytics has offices in London, New York, San Francisco, Austin and Visakhapatnam. In March 2021, Cardlytics acquired Dosh, a transaction-based advertising platform, and has entered into a definitive agreement to acquire Bridg, a customer data platform. Learn more at www.cardlytics.com.

Cautionary Language Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our financial guidance for the second quarter and full year of 2021, future growth, potential benefits of the acquisition of Dosh, potential benefits of the planned acquisition of Bridg, and achievement of long-range goals. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," or variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control.

Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to: risks related to the uncertain impacts that COVID-19 may have on our business, financial condition, results of operations; unfavorable conditions in the global economy and the industries that we serve; our quarterly operating results have fluctuated and may continue to vary from period to period; our ability to sustain our revenue growth and billings; risks related to closing the acquisition of Bridg and the integration of Dosh and Bridg with our company; risks related to our substantial dependence on our Cardlytics Direct product; risks related to our substantial dependence on JPMorgan Chase Bank, National Association (“Chase”), Bank of America, National Association ("Bank of America") and a limited number of other financial institution (“FI”) partners; the timing of the phased launch of the Cardlytics platform by U.S. Bank; risks related to our ability to maintain relationships with Chase, Wells Fargo and Bank of America; the amount and timing of budgets by marketers, which are affected by budget cycles, economic conditions and other factors, including the impact of the COVID-19 pandemic; our ability to generate sufficient revenue to offset contractual commitments to FIs; our ability to attract new partners, including FI partners, and maintain relationships with bank processors and digital banking providers; our ability to maintain relationships with marketers; our ability to adapt to changing market conditions, including our ability to adapt to changes in consumer habits, negotiate fee arrangements with new and existing partners and retailers, and develop and launch new services and features; and other risks detailed in the “Risk Factors” section of our Form 10-Q filed with the Securities and Exchange Commission on May 4, 2021 and in subsequent periodic reports that we file with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. 

The forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Non-GAAP Measures and Other Performance Metrics

To supplement the financial measures presented in our press release and related conference call or webcast in accordance with generally accepted accounting principles in the United States (“GAAP”), we also present the following non-GAAP measures of financial performance: billings, adjusted contribution, adjusted EBITDA, adjusted Partner Share and other third party costs, non-GAAP net loss and non-GAAP net loss per share as well as certain other performance metrics, such as monthly active users (“MAUs”) and average revenue per user (“ARPU”).

A “non-GAAP financial measure” refers to a numerical measure of our historical or future financial performance or financial position that is included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in our financial statements. We provide certain non-GAAP measures as additional information relating to our operating results as a complement to results provided in accordance with GAAP. The non-GAAP financial information presented herein should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP and should not be considered a measure of liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies.

We have presented billings, adjusted contribution, adjusted EBITDA, adjusted Partner Share and other third-party costs, non-GAAP net loss and non-GAAP net loss per share as non-GAAP financial measures in this press release. Billings represents the gross amount billed to marketers for advertising campaigns in order to generate revenue. Billings is reported gross of both Consumer Incentives and Partner Share. Our GAAP revenue is recognized net of Consumer Incentives and gross of Partner Share. We define adjusted contribution as a measure by which revenue generated from our marketers exceeds the cost to obtain the purchase data and the digital advertising space from our partners. Adjusted contribution demonstrates how incremental marketing spend on our platform generates incremental amounts to support our sales and marketing, research and development, general and administration and other investments. Adjusted contribution is calculated by taking our total revenue less our Partner Share and other third-party costs exclusive of deferred implementation costs, which is a non-cash cost. Adjusted contribution does not take into account all costs associated with generating revenue from advertising campaigns, including sales and marketing expenses, research and development expenses, general and administrative expenses and other expenses, which we do not take into consideration when making decisions on how to manage our advertising campaigns. We define adjusted EBITDA as our net loss before income tax benefit; interest expense, net; depreciation and amortization expense; stock-based compensation expense; foreign currency gain (loss); deferred implementation costs; restructuring costs, and acquisition and integration costs. We define adjusted Partner Share and other third-party costs as our Partner Share and other third-party costs excluding non-cash equity expense and amortization of deferred implementation costs. We define non-GAAP net loss income as our net loss before stock-based compensation expense; foreign currency gain (loss); acquisition and integration costs; amortization of acquired intangibles; and restructuring costs. Notably, any impacts related to minimum Partner Share commitments in connection with agreements with certain partners are not added back to net loss in order to calculate adjusted EBITDA, adjusted contribution and non-GAAP net loss. We define non-GAAP net loss per share as non-GAAP net loss divided by non-GAAP weighted-average common shares outstanding, basic and diluted, which includes our GAAP weighted-average common shares outstanding, basic and diluted, and our weighted-average preferred shares outstanding, assuming conversion.

We believe the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are either not part of our core operations or do not require a cash outlay, such as stock-based compensation expense. Management uses these non-GAAP financial measures when evaluating operating performance and for internal planning and forecasting purposes. We believe that these non-GAAP financial measures help indicate underlying trends in the business, are important in comparing current results with prior period results and are useful to investors and financial analysts in assessing operating performance.

We define MAUs as targetable customers or accounts that have logged in and visited online or mobile applications containing offers from, opened an email containing offers from, or redeemed an offer from the Cardlytics platform during a monthly period. We then calculate a monthly average of these MAUs for the periods presented. We define ARPU as the total revenue generated in the applicable period calculated in accordance with GAAP, divided by the average number of MAUs in the applicable period.

 

CARDLYTICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Amounts in thousands)
	March 31, 2021				December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	613,548			$	293,239
Restricted cash		111				110
Accounts receivable, net		73,334				81,249
Other receivables		5,911				5,306
Prepaid expenses and other assets		7,669				5,687
Total current assets		702,573				385,591
Long-term assets:
Property and equipment, net		14,118				13,865
Right-of-use assets under operating leases, net		10,810				10,764
Intangible assets, net		78,981				447
Goodwill		203,181				-
Capitalized software development costs, net		7,788				6,299
Deferred Implementation costs, net		2,903				3,785
Other long-term assets, net		2,681				1,786
Total assets	$	1,023,035			$	422,537
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	3,249			$	1,363
Accrued liabilities:
Accrued compensation		8,334				7,582
Accrued expenses		8,714				5,502
Partner Share liability		30,708				37,457
Consumer Incentive liability		35,318				24,290
Deferred revenue		259				349
Current operating lease liabilities		5,448				4,718
Current finance lease liabilities		7				13
Total current liabilities		92,037				81,274
Long-term liabilities:
Convertible senior notes, net		176,540				174,011
Long-term operating lease liabilities		8,887				9,381
Other long-term liabilities		679				679
Total liabilities		278,143				265,345
Stockholder's equity:
Common stock, $0.0001 par value—100,000 shares authorized and 27,861 and 31,770 shares issued and outstanding as of December 31, 2020 and March 31, 2021, respectively.		8				8
Additional paid-in capital		1,164,320				551,429
Accumulated other comprehensive income		(488	)			(192	)
Accumulated deficit		(418,948	)			(394,053	)
Total stockholders' equity		744,892				157,192
Total liabilities and stockholders' equity	$	1,023,035			$	422,537

CARDLYTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands, except per share amounts)
	Three Months Ended
	March 31,
	2021				2020
Revenue	$	53,230			$	45,509
Costs and expenses:
Partner Share and other third-party costs		29,771				26,138
Delivery costs		3,938				3,406
Sales and marketing expense		13,202				10,968
Research and development expense		6,218				3,851
General and administration expense		12,175				10,744
Acquisition and integration costs		7,030				-
Depreciation and amortization expense		3,065				2,331
Total costs and expenses		75,399				57,438
Operating loss		(22,169	)			(11,929	)
Other income (expense):
Interest (expense) income, net		(3,045	)			284
Foreign currency gain (loss)		319				(1,886	)
Total other expense		(2,726	)			(1,602	)
Loss before income taxes		(24,895	)			(13,531	)
Income tax benefit		-				-
Net loss		(24,895	)			(13,531	)
Net loss attributable to common stockholders	$	(24,895	)		$	(13,531	)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.85	)		$	(0.51	)
Weighted-average common shares outstanding, basic and diluted		29,313				26,725



 

CARDLYTICS, INC.
STOCK-BASED COMPENSATION EXPENSE (UNAUDITED)
(Amounts in thousands)
	Three Months Ended
	March 31,
	2021				2020
Delivery costs	$	309			$	175
Sales and marketing expense		2,432				1,269
Research and development expense		1,514				603
General and administration expense		2,993				2,078
Total stock-based compensation expense	$	7,248			$	4,125

 

CARDLYTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Amounts in thousands)
	Three Months Ended
	March 31,
	2021				2020
Operating activities
Net loss	$	(24,895	)		$	(13,531	)
Adjustments to reconcile net loss to net cash used in operating activities:
Credit loss expense		1,004				1,477
Depreciation and amortization		3,065				2,349
Amortization of financing costs charged to interest expense		219				24
Accretion of debt discount and non-cash interest expense		2,321				-
Amortization of right-of-use assets		1,073				879
Stock-based compensation expense		7,248				4,125
Other non-cash expense, net		(141	)			1,905
Amortization of deferred implementation costs		882				1,008
Change in operating assets and liabilities:
Accounts receivable		7,867				22,149
Prepaid expenses and other assets		(1,845	)			(509	)
Accounts payable		495				252
Other accrued expenses		996				(6,988	)
Partner Share liability		(6,749	)			(10,908	)
Consumer Incentive liability		(4,072	)			(5,638	)
Net cash used in operating activities		(12,532	)			(3,406	)
Investing activities
Acquisition of property and equipment		(1,377	)			(492	)
Acquisition of patents		(28	)			(23	)
Capitalized software development costs		(1,923	)			(922	)
Business acquisition, net of cash acquired		(148,634	)			-
Net cash used in investing activities		(151,962	)			(1,437	)
Financing activities
Principal payments of debt		(6	)			(6	)
Proceeds from issuance of common stock		484,713				3,145
Debt issuance costs		(42	)			-
Net cash received from financing activities		484,665				3,139
Effect of exchange rates on cash, cash equivalents and restricted cash		139				(588	)
Net increase in cash, cash equivalents and restricted cash		320,310				(2,292	)
Cash, cash equivalents and restricted cash - Beginning of period		293,349				104,587
Cash, cash equivalents and restricted cash - End of period	$	613,659			$	102,295

 

CARDLYTICS, INC.
SUMMARY OF GAAP AND NON-GAAP RESULTS (UNAUDITED)
(Dollars in thousands)
	Three Months Ended
	March 31,								Change
	2021				2020				$				%
Billings(1)	$	76,317			$	67,776			$	8,541			13	%
Consumer Incentives		23,087				22,267				820			4
Revenue		53,230				45,509				7,721			17
Adjusted Partner Share and other third-party costs(1)		28,889				25,130				3,759			15
Adjusted contribution(1)		24,341				20,379				3,962			19
Delivery costs		3,938				3,406				532			16
Deferred implementation costs		882				1,008				(126	)		(13	)
Gross profit	$	19,521			$	15,965			$	3,556			22	%

(1)

Billings, adjusted Partner Share and other third-party costs and adjusted contribution are non-GAAP measures. Reconciliations of these non-GAAP measures to the most comparable GAAP measures are presented below under the headings "Reconciliation of GAAP Revenue to Billings" and "Reconciliation of GAAP Gross Profit to Adjusted Contribution."

CARDLYTICS, INC.
RECONCILIATION OF GAAP REVENUE TO BILLINGS (UNAUDITED)
(Amounts in thousands)
	Three Months Ended
	March 31,
	2021				2020
Revenue	$	53,230			$	45,509
Plus:
Consumer Incentives		23,087				22,267
Billings	$	76,317			$	67,776

 

CARDLYTICS, INC.
RECONCILIATION OF GAAP GROSS PROFIT TO ADJUSTED CONTRIBUTION (UNAUDITED)
(Amounts in thousands)
	Three Months Ended
	March 31,
	2021				2020
Revenue	$	53,230			$	45,509
Minus:
Partner Share and other third-party costs		29,771				26,138
Delivery costs(1)		3,938				3,406
Gross profit		19,521				15,965
Plus:
Delivery costs(1)		3,938				3,406
Deferred implementation costs(2)		882				1,008
Adjusted contribution	$	24,341			$	20,379

 

(1)	Stock-based compensation expense recognized in delivery costs totaled $0.3 million and $0.2 million for the three months ended March 31, 2021 and 2020, respectively.
(2)	Deferred implementation costs are excluded from adjusted Partner Share and other third party costs as shown below (in thousands):

	Three Months Ended
	March 31,
	2021				2020
Partner Share and other third-party costs	$	29,771			$	26,138
Minus:
Deferred implementation costs	882				1,008
Adjusted Partner Share and other third-party costs	$	28,889			$	25,130

CARDLYTICS, INC.
RECONCILIATION OF GAAP NET LOSS TO ADJUSTED EBITDA (UNAUDITED)
(Amounts in thousands)
	Three Months Ended
	March 31,
	2021				2020
Net loss	$	(24,895	)		$	(13,531	)
Plus:
Income tax benefit		-				-
Interest expense, net		3,045				(284	)
Depreciation and amortization expense		3,065				2,331
Stock-based compensation expense		7,248				4,126
Foreign currency (gain) loss		(319	)			1,886
Deferred implementation costs		882				1,008
Restructuring costs		-				482
Acquisition and integration costs		7,030				-
Adjusted EBITDA	$	(3,944	)		$	(3,982	)



CARDLYTICS, INC.
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS AND NON-GAAP NET LOSS PER SHARE (UNAUDITED)
(Amounts in thousands, except per share amounts)
	Three Months Ended
	March 31,
	2021				2020
Net loss	$	(24,895	)		$	(13,531	)
Plus:
Stock-based compensation expense		7,248				4,125
Foreign currency (gain) loss		(319	)			1,886
Acquisition and integration costs		7,030				-
Amortization of acquired intangibles		998				-
Restructuring costs		-				482
Non-GAAP net loss	$	(9,947	)		$	(7,038	)
Weighted-average number of shares of common stock used in computing non-GAAP net loss per share:
GAAP weighted-average common shares outstanding, diluted		29,313				26,725
Non-GAAP net loss per share attributable to common stockholders, diluted	$	(0.34	)		$	(0.26	)

CARDLYTICS, INC.
RECONCILIATION OF FORECASTED GAAP REVENUE TO BILLINGS (UNAUDITED)
(Amounts in millions)
	Q2 2021 Guidance		FY 2021 Guidance
Revenue	$58.0 - $65.0		$260.0 - $285.0
Plus:
Consumer Incentives	$27.0 - $30.0		$120.0 - $135.0
Billings	$85.0 - $95.0		$380.0 - $420.0

Contacts:

Public Relations:
Angie Amberg
Cardlytics, Inc.
aamberg@cardlytics.com

Investor Relations:
William Maina
ICR, Inc.
(646) 277-1236
ir@cardlytics.com

FAQ

What were Cardlytics' Q1 2021 revenue results?

Cardlytics reported Q1 2021 revenue of $53.2 million, a 17% increase year-over-year.

How did Cardlytics perform in terms of billings in Q1 2021?

Billings for Q1 2021 were $76.3 million, up 13% from the previous year.

What is the earnings guidance for Cardlytics in Q2 and FY 2021?

Cardlytics anticipates Q2 2021 revenue between $58.0 million and $65.0 million and full-year revenue guidance of $260.0 million to $285.0 million.

What was the net loss for Cardlytics in Q1 2021?

Cardlytics reported a net loss of $(24.9) million, or $(0.85) per diluted share, in Q1 2021.