LiveOne Posts Record 9-Month Revenue of $93.6 Million, Up 112%, and Third Quarter Revenue of $32.9 Million, Up 72%
LiveOne (NASDAQ: LVO) reported substantial financial growth, with a 112% revenue increase for the first nine months of fiscal 2022, reaching a record $93.6 million. In Q3 Fiscal 2022, revenue hit $32.9 million, up from $19.1 million the previous year, despite an operating loss of $10 million. The company anticipates annual cost savings exceeding $14 million and expects to achieve positive Adjusted EBITDA for the first time in Q1 FY 2023. As of December 31, 2021, LiveOne boasted over 1.36 million paid subscribers.
- 112% revenue increase to $93.6 million year-over-year.
- Q3 revenue grew to $32.9 million from $19.1 million.
- Anticipated annual cost savings exceeding $14 million.
- Over 1.36 million paid subscribers, a 37% increase year-over-year.
- Operating loss of $10.0 million in Q3 FY 2022, up from $7.6 million in Q3 FY 2021.
- Net loss of $11.8 million in Q3 FY 2022, compared to $8.7 million in Q3 FY 2021.
- Adjusted EBITDA loss of $4.8 million in Q3 FY 2022, worse than a $1.9 million loss in the previous year.
LOS ANGELES, Feb. 10, 2022 /PRNewswire/ -- LiveOne (Nasdaq: LVO), a creator-first, music, entertainment and technology platform focused on delivering premium experiences and content worldwide through memberships, subscriptions, and live and virtual events, announced today operating results for its first nine months and third fiscal quarter ended December 31, 2021 ("Q3 Fiscal 2022").
For the nine-month period ended December 31, 2021, revenue increased
In Q3 Fiscal 2022, LiveOne posted revenue of
As previously announced, LiveOne is implementing further cost and expense reductions from both operations and corporate overhead which is anticipated to increase the previously implemented
With the anticipated return of live events, LiveOne's React Presents live event subsidiary is expected to post positive Adjusted EBITDA* in Fiscal 2023 versus Adjusted EBITDA* of a (
LiveOne's CEO and Chairman, Robert Ellin, commented, "We expect our strong year-over-year revenue growth to continue throughout calendar 2022 given the expected return of many of our live music events, the increase in substantial advertising and sponsorship deals, and the anticipated continued growth of paid subscribers through partnerships, including Tesla."
Mr. Ellin continued, "We have strategically pivoted and pulled forward our path and timeline to expected positive adjusted EBITDA*, and I am excited that we are now positioned to achieve positive adjusted EBITDA* for the first time in our history in the upcoming quarter ending June 30, 2022."
LiveOne Ended Calendar Year 2021 with the following:
- Over 1.36 Million paid subscribers**, up
37% year-over-calendar year. - Completed a User Interface refresh of all "New" and "Top" stations within the Tesla in-car paid Slacker Radio streaming experience.
- Added over 100 new blue-chip sponsors with currently over 175 in the pipeline
- Livestreamed over 2,900 artists, 188 million livestream views, and 155 events, and achieved
59% engagement growth across its social and digital platforms. - 115 pay-per-view events broadcasted on LiveOne's platform.
- LiveOne's wholly owned subsidiary PodcastOne had record metrics of over 2.48 billion. podcast downloads and its franchise of exclusive shows has now grown to more than 235 and now produces more than 300 podcast episodes per week.
- Total social media reach across the exclusive talent roster of PodcastOne now exceeds 280 million.
- 41 new podcast shows joined the PodcastOne network consisting of 18 new shows and 23 existing shows that migrated to the PodcastOne platform.
- PodcastOne's popular LadyGang podcast surpassed 500 episodes.
- LiveOne's 24-hour linear OTT streaming channel reaches over 294 million people on Amazon Fire, Roku, Apple TV, SLING, Xumo, and ReachTV, Consumable TV streaming original content, artist interviews, concerts, festivals, ancillary event-related content, and short-form video content from around the world.
Recent and Q3 Fiscal 2022 Highlights
- LiveOne recently expanded it exclusive PodcastOne content into Tesla vehicles as well as within the Android automotive app platform. Android Automotive continues to see wide adoption from virtually all the major automotive OEMs, including Ford, GMC, Dodge, Chrysler, Volvo, Polestar, Ford, Lincoln, Chevrolet, Nissan, Volkswagen, Mitsubishi, and others.
- As previously announced, LiveOne intends to spin-out its existing pay-per-view ("PPV") business, PPVOne, as a separate public company and its plan to distribute a portion of the new company's equity to LiveOne's stockholders, anticipated to take place in early FY 2023. Since launching its PPV platform in May 2020, LiveOne has generated approximately
$26.7 million of PPV related sales in live and PPV events. - Paid subscribers as of December 31, 2021 increased to more than 1,369,000, a net increase of approximately 369,000, as compared to 1,000,000 subscribers at December 31, 2020**.
- LiveOne's 24-hour linear OTT streaming channel reaches over 294 million people on Amazon Fire, Roku, Apple TV, SLING, Xumo, and ReachTV, Consumable TV streaming original content, artist interviews, concerts, festivals, ancillary event-related content, and short-form video content from around the world.
- As previously announced in January 2021, with the assistance of J.P. Morgan, LiveOne is continuing a process to explore strategic alternatives in order to enhance shareholder value. Potential alternatives may include, among others, a strategic acquisition, divestiture, merger, sale or other form of business combination. There can be no assurance that LiveOne's efforts will result in a specific transaction or any particular outcome or its timing.
- As previously announced in December 2020, LiveOne's board of directors authorized the repurchase of up to two million shares of LiveOne's outstanding common stock from time to time, subject to certain compliance with applicable laws and regulations.
Third Quarter 2022 and 2021 Results Summary (in
Three Months | Three Months | |||||||
Revenue | $ | 32,895 | $ | 19,123 | ||||
Operating Loss | $ | (9,968) | $ | (7,595) | ||||
Total Other Expense | $ | (1,863) | $ | (1,136) | ||||
Net Loss | $ | (11,791) | $ | (8,731) | ||||
Adjusted EBITDA* | $ | (4,834) | $ | (1,946) | ||||
Net Loss per share - basic and diluted | $ | (0.15) | $ | (0.12) | ||||
Third Quarter 2022 Results Summary Discussion
For Q3 Fiscal 2022, LiveOne posted revenue of
Q3 Fiscal 2022 Operating Loss was (
Q3 Fiscal 2022 Adjusted EBITDA* was a (
Capital expenditures for Q3 Fiscal 2022 totaled approximately
At December 31, 2021, LiveOne had
LiveOne is maintaining its previous guidance for Fiscal 2022 revenues which are expected to be
Conference Call and Webcast
LiveOne's senior management will host a live conference call and audio webcast to provide a business update and discuss its operating and financial results for the third quarter ended December 31, 2021 beginning at 4:30 p.m. ET / 1:30 p.m. PT on Thursday, February 10, 2022.
WHEN: Thursday, February 10, 2022
TIME: 4:30 PM ET / 1:30 PM PT
DOMESTIC DIAL-IN: 253-215-8782
Meeting ID: 98298534717
Passcode: 973141
WEBCAST – To register for the live webcast, please go to: https://audience.mysequire.com/webinar-view?webinar_id=21859972-7f0f-422d-9e06-5b94df73bfd9
A replay can be accessed on the Investor Relations section of LiveOne's website at Events | LiveOne
About LiveOne, Inc.
Headquartered in Los Angeles, California, LiveOne, Inc. (NASDAQ: LVO) (the "Company") is a creator-first, music, entertainment and technology platform focused on delivering premium experiences and content worldwide through memberships, subscriptions and live and virtual events, and owner of LiveXLive, PPVOne, PodcastOne, Slacker Radio, React Presents, Gramophone Media, Palm Beach Records, and Custom Personalization Solutions. As of January 2022, the Company has accrued a paid subscriber base of over 1.36** million, streamed over 2,900 artists, has a library of 30 million songs, 600 curated radio stations, 268 podcasts/vodcasts, hundreds of pay-per-views, personalized merchandise, released music-related NFTs, and has created a valuable connection between fans, brands, and bands. PodcastOne generates more than 2.48 billion downloads per year and 300+ episodes distributed per week across its stable of top-rated podcasts. LiveXLive is available on iOS, Android, Roku, Apple TV, Amazon Fire, and through OTT, STIRR, and XUMO. For more information, visit www.livexlive.com and follow us on Facebook, Instagram, TikTok, and Twitter.
* About Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with the accounting principles generally accepted in the United States of America ("GAAP"), we present Contribution Margin (Loss) and Adjusted Earnings Before Interest Tax Depreciation and Amortization ("Adjusted EBITDA"), which are non-GAAP financial measures, as measures of our performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, or superior to, operating loss and or net income (loss) or any other performance measures derived in accordance with GAAP or as an alternative to net cash provided by operating activities or any other measures of our cash flows or liquidity.
We use Contribution Margin (Loss) and Adjusted EBITDA to evaluate the performance of our operating segment. We believe that information about these non-GAAP financial measures assists investors by allowing them to evaluate changes in the operating results of our business separate from non-operational factors that affect operating income (loss) and net income (loss), thus providing insights into both operations and the other factors that affect reported results. Adjusted EBITDA is not calculated or presented in accordance with GAAP. A limitation of the use of Adjusted EBITDA as a performance measure is that it does not reflect the periodic costs of certain amortizing assets used in generating revenue in our business. Accordingly, Adjusted EBITDA should be considered in addition to, and not as a substitute for net income (loss), and other measures of financial performance reported in accordance with GAAP. Furthermore, this measure may vary among other companies; thus, Adjusted EBITDA as presented herein may not be comparable to similarly titled measures of other companies.
Contribution Margin (Loss) is defined as Revenue less Cost of Sales. Adjusted EBITDA is defined as earnings before interest, other (income) expense, income tax expense, depreciation and amortization and before (a) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (b) legal, accounting and other professional fees directly attributable to acquisition activity, (c) employee severance payments and third party professional fees directly attributable to acquisition or corporate realignment activities, (d) certain non-recurring expenses associated with legal settlements or reserves for legal settlements in the period that pertain to historical matters that existed at acquired companies prior to their purchase date and a one-time minimum guarantee to effectively terminate a live events distribution agreement post COVID-19, (e) depreciation and amortization (including goodwill impairment, if any), and (f) certain stock-based compensation expense. Management does not consider these costs to be indicative of our core operating results.
With respect to projected full year 2022 and 2023 Adjusted EBITDA, a quantitative reconciliation is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to purchase accounting adjustments, acquisition-related charges and legal settlement reserves excluded from Adjusted EBITDA. We expect that the variability of these items to have a potentially unpredictable, and potentially significant, impact on our future GAAP financial results.
For more information on this non-GAAP financial measure, please see the table entitled "Reconciliation of Non-GAAP Measure to GAAP Measure" included at the end of this release.
Forward-Looking Statements
All statements other than statements of historical facts contained in this press release are "forward-looking statements," which may often, but not always, be identified by the use of such words as "may," "might," "will," "will likely result," "would," "should," "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "continue," "target" or the negative of such terms or other similar expressions. These statements involve known and unknown risks, uncertainties and other factors, which may cause actual results, performance or achievements to differ materially from those expressed or implied by such statements, including: the Company's reliance on one key customer for a substantial percentage of its revenue; the Company's ability to consummate any proposed financing, acquisition, spin-out, distribution or transaction, the timing of the closing of such proposed event, including the risks that a condition to closing would not be satisfied within the expected timeframe or at all, or that the closing of any proposed financing, acquisition, spin-out, distribution or transaction will not occur or whether any such event will enhance shareholder value; the Company's ability to continue as a going concern; the Company's ability to attract, maintain and increase the number of its users and paid subscribers; the Company identifying, acquiring, securing and developing content; the Company's intent to repurchase shares of its common stock from time to time under its announced stock repurchase program and the timing, price, and quantity of repurchases, if any, under the program; the Company's ability to maintain compliance with certain financial and other covenants; the Company successfully implementing its growth strategy, including relating to its technology platforms and applications; management's relationships with industry stakeholders; the effects of the global Covid-19 pandemic; changes in economic conditions; competition; risks and uncertainties applicable to the businesses of the Company's subsidiaries; and other risks, uncertainties and factors including, but not limited to, those described in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2021, filed with the U.S. Securities and Exchange Commission (the "SEC") on July 14, 2021, Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, filed with the SEC on August 16, 2021, Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2021, filed with the SEC on October 29, 2021, and in the Company's other filings and submissions with the SEC. These forward-looking statements speak only as of the date hereof, and the Company disclaims any obligations to update these statements, except as may be required by law. The Company intends that all forward-looking statements be subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.
** Included in the total number of subscribers for the reported periods are certain subscribers which are the subject of a contractual dispute. LiveOne is currently not recognizing revenue related to these subscribers.
Financial Information
The tables below present financial results for the three and nine months ended December 31, 2021 and 2020.
LiveOne, Inc. | ||||||||||||||||
Consolidated Statements of Operations (Unaudited) | ||||||||||||||||
(In thousands, except share and per share amounts) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue: | $ | 32,895 | $ | 19,123 | $ | 93,586 | $ | 44,189 | ||||||||
Operating expenses: | ||||||||||||||||
Cost of sales | 27,666 | 14,564 | 74,654 | 32,524 | ||||||||||||
Sales and marketing | 3,466 | 3,059 | 10,814 | 6,481 | ||||||||||||
Product development | 1,657 | 2,534 | 5,990 | 6,908 | ||||||||||||
General and administrative | 8,550 | 5,162 | 27,173 | 14,762 | ||||||||||||
Amortization of intangible assets | 1,524 | 1,399 | 4,547 | 4,057 | ||||||||||||
Total operating expenses | 42,863 | 26,718 | 123,178 | 64,732 | ||||||||||||
Loss from operations | (9,968) | (7,595) | (29,592) | (20,543) | ||||||||||||
Other income (expense): | ||||||||||||||||
Interest expense, net | (1,052) | (998) | (3,180) | (4,097) | ||||||||||||
Loss on extinguishment of debt | - | - | (4,321) | (1,488) | ||||||||||||
Forgiveness of PPP loans | - | - | 2,511 | - | ||||||||||||
Other income (expense) | (811) | (138) | (528) | (320) | ||||||||||||
Total other expense, net | (1,863) | (1,136) | (5,518) | (5,905) | ||||||||||||
Loss before provision for income taxes | (11,831) | (8,731) | (35,110) | (26,448) | ||||||||||||
Provision for (benefit from) income taxes | (40) | - | (32) | 4 | ||||||||||||
Net loss | $ | (11,791) | $ | (8,731) | $ | (35,078) | $ | (26,452) | ||||||||
Net loss per share – basic and diluted | $ | (0.15) | $ | (0.12) | $ | (0.45) | $ | (0.40) | ||||||||
Weighted average common shares – basic and diluted | 78,188,050 | 72,356,093 | 77,670,598 | 66,880,417 | ||||||||||||
LiveOne, Inc. | ||||||||
Consolidated Balance Sheets (Unaudited) | ||||||||
(In thousands) | ||||||||
December 31, | March 31, | |||||||
2021 | 2021 | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 12,396 | $ | 18,635 | ||||
Restricted cash | 260 | 135 | ||||||
Accounts receivable, net | 17,868 | 10,567 | ||||||
Inventories | 2,115 | 2,568 | ||||||
Prepaid expense and other assets | 2,897 | 3,366 | ||||||
Total Current Assets | 35,536 | 35,271 | ||||||
Property and equipment, net | 4,752 | 4,367 | ||||||
Goodwill | 23,380 | 22,619 | ||||||
Intangible assets, net | 18,173 | 22,468 | ||||||
Other assets | 802 | 1,044 | ||||||
Total Assets | $ | 82,643 | $ | 85,769 | ||||
Liabilities and Stockholders' Equity (Deficit) | ||||||||
Current Liabilities | ||||||||
Accounts payable and accrued liabilities | $ | 43,400 | $ | 32,646 | ||||
Accrued royalties | 12,629 | 12,349 | ||||||
Notes payable, current portion | 141 | 2,729 | ||||||
Deferred revenue | 1,701 | 1,262 | ||||||
Unsecured convertible notes, net | - | 1,976 | ||||||
Total Current Liabilities | 57,871 | 50,962 | ||||||
Secured convertible notes, net | 13,395 | 13,047 | ||||||
Unsecured convertible notes, net | 5,786 | 5,501 | ||||||
Senior secured revolving line of credit | 6,965 | - | ||||||
Notes payable, net | 620 | 885 | ||||||
Lease liabilities, noncurrent | 540 | 742 | ||||||
Due to Music Partner | - | 3,937 | ||||||
Other long-term liabilities | 174 | 2,422 | ||||||
Deferred income taxes | 137 | 137 | ||||||
Total Liabilities | 85,488 | 77,633 | ||||||
Commitments and Contingencies | ||||||||
Stockholders' Equity (Deficit) | ||||||||
Preferred stock, | - | - | ||||||
Common stock, | 81 | 77 | ||||||
Additional paid in capital | 202,093 | 178,000 | ||||||
Accumulated deficit | (205,019) | (169,941) | ||||||
Total stockholders' equity (deficit) | (2,845) | 8,136 | ||||||
Total Liabilities and Stockholders' Equity (Deficit) | $ | 82,643 | $ | 85,769 | ||||
LiveOne, Inc. | ||||||||||||||||||||||||||||
Reconciliation of Non-GAAP Measure to GAAP Measure | ||||||||||||||||||||||||||||
Adjusted EBITDA* Reconciliation (Unaudited) | ||||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
Net | Depreciation | Stock-Based | Other | Other | Provision | Adjusted | ||||||||||||||||||||||
Three Months Ended December 31, 2021 | ||||||||||||||||||||||||||||
Operations | $ | (4,386) | $ | 2,435 | $ | 268 | $ | 75 | $ | 269 | $ | (41) | $ | (1,380) | ||||||||||||||
Corporate | (7,405) | 10 | 1,860 | 488 | 1,594 | 1 | (3,454) | |||||||||||||||||||||
Total | $ | (11,791) | $ | 2,445 | $ | 2,128 | $ | 563 | $ | 1,863 | $ | (40) | $ | (4,834) | ||||||||||||||
Three Months Ended December 31, 2020 | ||||||||||||||||||||||||||||
Operations | $ | (5,057) | $ | 2,173 | $ | 1,630 | $ | 256 | $ | 421 | $ | - | $ | (577) | ||||||||||||||
Corporate | (3,674) | - | 1,062 | 528 | 715 | - | (1,369) | |||||||||||||||||||||
Total | $ | (8,731) | $ | 2,173 | $ | 2,692 | $ | 784 | $ | 1,136 | $ | - | $ | (1,946) | ||||||||||||||
Net | Depreciation | Stock-Based | Other | Other | Provision | Adjusted | ||||||||||||||||||||||
Nine months Ended December 31, 2021 | ||||||||||||||||||||||||||||
Operations | $ | (10,542) | $ | 7,204 | $ | 3,596 | $ | 429 | $ | 335 | $ | (41) | $ | 981 | ||||||||||||||
Corporate | (24,536) | 26 | 8,463 | 1,219 | 5,183 | 9 | (9,636) | |||||||||||||||||||||
Total | $ | (35,078) | $ | 7,230 | $ | 12,059 | $ | 1,648 | $ | 5,518 | $ | (32) | $ | (8,655) | ||||||||||||||
Nine months Ended December 31, 2020 | ||||||||||||||||||||||||||||
Operations | $ | (13,355) | $ | 6,368 | $ | 4,148 | $ | 963 | $ | 2,291 | $ | (4) | $ | 410 | ||||||||||||||
Corporate | (13,097) | - | 3,885 | 1,788 | 3,614 | 8 | (3,801) | |||||||||||||||||||||
Total | $ | (26,452) | $ | 6,368 | $ | 8,033 | $ | 2,751 | $ | 5,905 | $ | 4 | $ | (3,391) | ||||||||||||||
(1) | Other Non-Operating and Non-Recurring Costs include outside legal, accounting and other professional fees directly attributable to acquisition activity in the period, in addition to certain non-recurring expenses associated with legal settlements or reserves for legal settlements in the period that pertain to historical matters that existed at certain acquired companies prior to their purchase date and non-recurring employee severance payments and to a lesser extent, a one-time minimum guarantee to effectively terminate a live-event distribution agreement post COVID-19. |
(2) | Other (income) expense above primarily includes interest expense, net, forgiveness of PPP loans, and loss on extinguishment of debt. These are included in the statement of operations in other income (expense) and are an add back to net loss above in the reconciliation of Adjusted EBITDA* to loss. |
* | See the definitions of Contribution Margin and Adjusted EBITDA* under "About Non-GAAP Financial Measures" within this release. |
LiveOne, Inc. | ||||||||||||||||
Reconciliation of Non-GAAP Measure to GAAP Measure | ||||||||||||||||
Contribution Margin* Reconciliation (Unaudited) | ||||||||||||||||
(In thousands) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue: | $ | 32,895 | $ | 19,123 | $ | 93,586 | $ | 44,189 | ||||||||
Less Cost of Sales: | (27,666) | (14,564) | (74,654) | (32,524) | ||||||||||||
Contribution Margin* | $ | 5,229 | $ | 4,559 | $ | 18,932 | $ | 11,665 | ||||||||
* | See the definition of Contribution Margin under "About Non-GAAP Financial Measures" within this release. |
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SOURCE LiveOne, Inc.
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