Comscore Reports Fourth Quarter and Full Year 2023 Results
- None.
- None.
Insights
Comscore's reported financial results highlight a contraction in revenue year-over-year, with a notable net loss increase primarily due to non-cash goodwill impairment charges. This is a critical indicator of the company's valuation adjustments and potential overestimation of assets in previous periods. The adjusted EBITDA growth, however, suggests operational improvements, as it excludes non-cash charges and other non-recurring expenses. The emphasis on adjusted metrics like EBITDA and FX adjusted EBITDA is relevant for investors focusing on operational performance, excluding the volatility of currency fluctuations.
The increased net loss margin year-over-year is concerning, but the growth in adjusted EBITDA margins indicates better operational efficiency. The focus should be on the sustainability of EBITDA improvements and their potential impact on future profitability. Additionally, the company's liquidity position, with a slight increase in cash and cash equivalents, provides some cushion, but the overall increase in net loss may raise concerns about long-term financial health.
The 2024 outlook with projected revenue growth and improved EBITDA margins reflects management's optimism. However, the market will likely scrutinize the achievability of these targets, especially given the pressures on national TV revenue and the unpredictable demand for custom digital products amidst a challenging macroeconomic environment.
Comscore's performance in the Digital Ad Solutions and Cross Platform Solutions segments requires attention. The reported decline in national TV offering renewals is indicative of broader industry trends where advertisers are shifting toward digital and targeted advertising solutions. The growth in local TV and movies business, as well as the 34% combined growth in Activation and Comscore Campaign Ratings (CCR) products, signals a strategic pivot aligning with market demands for more precise and effective media buying solutions.
Investors should note the company's restructuring efforts which have led to reduced core operating expenses. This, coupled with increased focus on product infrastructure and innovation, may position Comscore to capitalize on the evolving media landscape. The challenge will be to monitor how effectively Comscore can continue to grow its high-performing segments and manage the decline in traditional areas such as national TV.
The financial results of Comscore must be contextualized within the broader economic landscape. The decline in certain revenue streams and the unpredictability of demand for custom digital products are potentially symptomatic of cyclical economic pressures and a shift in advertising spend. The double-digit growth in local TV revenue and the expansion of digital offerings like CCR are strategic moves that could pay dividends in a more digitally-centric advertising future. However, the reliance on these growth areas to offset declines in other segments may present risks if the economic downturn persists or intensifies.
The forecasted revenue growth and EBITDA margins for 2024 reflect a cautiously optimistic outlook, likely hinging on the company's ability to execute on its restructuring plan and innovation initiatives. The anticipated challenges in the national TV sector mirror the industry's transition away from traditional media spending, which could have wider implications for companies reliant on such revenue streams.
RESTON, Va., March 06, 2024 (GLOBE NEWSWIRE) -- Comscore, Inc. (Nasdaq: SCOR), a trusted partner for planning, transacting and evaluating media across platforms, today reported financial results for the fourth quarter and full year ended December 31, 2023.
FY 2023 Financial Highlights
- Revenue for 2023 was
$371.3 million compared to$376.4 million in 2022 - Net loss of
$79.4 million compared to$66.6 million in 2022, resulting primarily from non-cash goodwill impairment charges of$78.2 million and$46.3 million , respectively - Adjusted EBITDA of
$44.0 million compared to$37.5 million in 2022 - FX adjusted EBITDA of
$46.9 million compared to$36.3 million in 2022 - Cash, cash equivalents and restricted cash of
$22.9 million versus$20.4 million as of December 31, 2022
Q4 2023 Financial Highlights
- Revenue for the fourth quarter was
$95.1 million compared to$98.2 million in Q4 2022 - Net loss of
$28.4 million compared to net income of$0.1 million in Q4 2022, resulting primarily from a non-cash goodwill impairment charge of$34.1 million in Q4 2023 - Adjusted EBITDA of
$16.4 million compared to$12.0 million in Q4 2022 - FX adjusted EBITDA of
$18.7 million compared to$16.6 million in Q4 2022
2024 Financial Outlook
- Full year revenue expected to be between
$375 million and$390 million - Adjusted EBITDA margin expected to be between
12% and15% for the year
"As we reflect on 2023, there is a lot to be proud of. While we fell short of our top line revenue goals for the year, we made substantial progress on changing the way we operate, which allowed us to achieve our adjusted EBITDA goals. I appreciate the hard work our employees have done to deliver for our stakeholders throughout the year," said Jon Carpenter, CEO of Comscore. "As we begin 2024, I remain confident that we are moving the business in the right direction as we execute on our turnaround. We're focused on providing the fast and accurate cross-platform data that helps our clients buy, sell and optimize media more effectively. Our double-digit growth in local TV, coupled with accelerated growth of our Comscore Campaign Ratings (CCR) product and our Proximic offerings - a combined
Fourth Quarter Summary Results
Revenue in the fourth quarter was
Our core operating expenses, which include cost of revenues, sales and marketing, research and development and general and administrative expenses, were
Net loss for the quarter was
Non-GAAP adjusted EBITDA for the quarter was
Full-Year Summary Results
Revenue for 2023 was
Our core operating expenses, which include cost of revenues, sales and marketing, research and development and general and administrative expenses, were
Net loss for the year was
Non-GAAP adjusted EBITDA for the year was
Balance Sheet and Liquidity
As of December 31, 2023, cash, cash equivalents and restricted cash totaled
2024 Outlook
Based on current trends and expectations, we believe 2024 revenue will be between
We do not provide GAAP net income (loss) or net income (loss) margin on a forward-looking basis because we are unable to predict with reasonable certainty our future stock-based compensation expense, fair value adjustments, variable interest expense, litigation and restructuring expense and any unusual gains or losses without unreasonable effort. These items are uncertain, depend on various factors, and could be material to results computed in accordance with GAAP. For this reason, we are unable without unreasonable effort to provide a reconciliation of adjusted EBITDA or adjusted EBITDA margin to the most directly comparable GAAP measure, GAAP net income (loss) and net income (loss) margin, on a forward-looking basis.
Conference Call Information for Today, Wednesday, March 6, 2024 at 5:00 p.m. ET
Management will host a conference call to discuss the results on Wednesday, March 6, 2024, at 5:00 p.m. ET. The live audio webcast along with supplemental information will be accessible at ir.comscore.com/events-presentations. Participants can obtain dial-in information by registering for the call at the same web address and are advised to register in advance of the call to avoid delays. Following the conference call, a replay will be available via webcast at ir.comscore.com/events-presentations.
About Comscore
Comscore is a global, trusted partner for planning, transacting and evaluating media across platforms. With a data footprint that combines digital, linear TV, over-the-top and theatrical viewership intelligence with advanced audience insights, Comscore empowers media buyers and sellers to quantify their multiscreen behavior and make meaningful business decisions with confidence. A proven leader in measuring digital and TV audiences and advertising at scale, Comscore is the industry's emerging, third-party source for reliable and comprehensive cross-platform measurement.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal and state securities laws, including, without limitation, our expectations, forecasts, plans and opinions regarding expected revenue growth and adjusted EBITDA margin for 2024, growth areas, strategic and financial focus areas, economic and industry trends, value delivery to clients and shareholders, product infrastructure and innovation, and restructuring plans. These statements involve risks and uncertainties that could cause actual events to differ materially from expectations, including, but not limited to, changes in our business and customer, partner and vendor relationships; external market conditions and competition; changes or declines in ad spending or other macroeconomic factors; evolving privacy and regulatory standards; and our ability to achieve our expected strategic, financial and operational plans, including the restructuring plan we announced in September 2022. For additional discussion of risk factors, please refer to our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and other filings that we make from time to time with the U.S. Securities and Exchange Commission (the "SEC"), which are available on the SEC's website (www.sec.gov).
Investors are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. We do not intend or undertake, and expressly disclaim, any duty or obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after the date of this press release, or to reflect the occurrence of unanticipated events.
Use of Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results, we are disclosing in this press release adjusted EBITDA, adjusted EBITDA margin and FX adjusted EBITDA, which are non-GAAP financial measures used by our management to understand and evaluate our core operating performance and trends. We believe that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating our operating results, as they permit our investors to view our core business performance using the same metrics that management uses to evaluate our performance. Nevertheless, our use of these non-GAAP financial measures has limitations as an analytical tool, and investors should not consider these measures in isolation or as a substitute for analysis of our results as reported under GAAP. Instead, you should consider these measures alongside GAAP-based financial performance measures, net income (loss), net income (loss) margin, various cash flow metrics, and our other GAAP financial results. Set forth below are reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures, net income (loss) and net income (loss) margin. These reconciliations should be carefully evaluated.
Media
Jenny Mulholland
press@comscore.com
Investors
John Tinker
Comscore, Inc.
212-203-2129
jtinker@comscore.com
| COMSCORE, INC. | |||||||
| CONSOLIDATED BALANCE SHEETS | |||||||
| (In thousands, except share and per share data) | |||||||
| As of December 31, | |||||||
| 2023 | 2022 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 22,750 | $ | 20,044 | |||
| Restricted cash | 186 | 398 | |||||
| Accounts receivable, net of allowances of | 63,826 | 68,457 | |||||
| Prepaid expenses and other current assets | 11,228 | 15,922 | |||||
| Total current assets | 97,990 | 104,821 | |||||
| Property and equipment, net | 41,574 | 36,367 | |||||
| Operating right-of-use assets | 18,628 | 23,864 | |||||
| Deferred tax assets | 2,588 | 3,351 | |||||
| Intangible assets, net | 8,115 | 13,327 | |||||
| Goodwill | 310,360 | 387,973 | |||||
| Other non-current assets | 12,040 | 10,883 | |||||
| Total assets | $ | 491,295 | $ | 580,586 | |||
| Liabilities, Convertible Redeemable Preferred Stock and Stockholders' Equity | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 30,551 | $ | 29,090 | |||
| Accrued expenses | 34,422 | 43,393 | |||||
| Contract liabilities | 48,912 | 52,944 | |||||
| Revolving line of credit | 16,000 | — | |||||
| Accrued dividends | 24,132 | 7,863 | |||||
| Customer advances | 11,076 | 11,527 | |||||
| Current operating lease liabilities | 7,982 | 7,639 | |||||
| Current portion of contingent consideration | 4,806 | 7,134 | |||||
| Other current liabilities | 4,680 | 5,501 | |||||
| Total current liabilities | 182,561 | 165,091 | |||||
| Non-current operating lease liabilities | 23,003 | 29,588 | |||||
| Non-current portion of accrued data costs | 32,833 | 25,106 | |||||
| Non-current revolving line of credit | — | 16,000 | |||||
| Deferred tax liabilities | 1,321 | 2,127 | |||||
| Other non-current liabilities | 7,589 | 10,627 | |||||
| Total liabilities | 247,307 | 248,539 | |||||
| Commitments and contingencies | |||||||
| Convertible redeemable preferred stock, | 187,885 | 187,885 | |||||
| Stockholders' equity: | |||||||
| Preferred stock, | — | — | |||||
| Common stock, | 5 | 5 | |||||
| Additional paid-in capital (1) | 1,696,612 | 1,690,870 | |||||
| Accumulated other comprehensive loss | (14,110 | ) | (15,940 | ) | |||
| Accumulated deficit | (1,396,420 | ) | (1,300,789 | ) | |||
| Treasury stock, at cost, 338,239 shares as of December 31, 2023 and 2022 (1) | (229,984 | ) | (229,984 | ) | |||
| Total stockholders' equity | 56,103 | 144,162 | |||||
| Total liabilities, convertible redeemable preferred stock and stockholders' equity | $ | 491,295 | $ | 580,586 | |||
(1) Adjusted retroactively for a 1-for-20 reverse split of our common stock effected on December 20, 2023 (the "Reverse Stock Split").
| COMSCORE, INC. | |||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||||||
| (In thousands, except share and per share data) | |||||||||||
| Years Ended December 31, | |||||||||||
| 2023 | 2022 | 2021 | |||||||||
| Revenues | $ | 371,343 | $ | 376,423 | $ | 367,013 | |||||
| Cost of revenues (1) (2) | 205,580 | 205,294 | 203,044 | ||||||||
| Selling and marketing (1) (2) | 63,322 | 68,453 | 66,937 | ||||||||
| Research and development (1) (2) | 33,701 | 36,987 | 39,123 | ||||||||
| General and administrative (1) (2) | 51,192 | 61,200 | 61,736 | ||||||||
| Amortization of intangible assets | 5,213 | 27,096 | 25,038 | ||||||||
| Impairment of goodwill | 78,200 | 46,300 | — | ||||||||
| Restructuring | 6,234 | 5,810 | — | ||||||||
| Impairment of right-of-use and long-lived assets | 1,502 | 156 | — | ||||||||
| Total expenses from operations | 444,944 | 451,296 | 395,878 | ||||||||
| Loss from operations | (73,601 | ) | (74,873 | ) | (28,865 | ) | |||||
| Interest expense, net | (1,445 | ) | (915 | ) | (7,801 | ) | |||||
| Other income (expense), net | 42 | 9,785 | (5,778 | ) | |||||||
| (Loss) gain from foreign currency transactions | (2,824 | ) | 1,166 | 2,895 | |||||||
| Loss on extinguishment of debt | — | — | (9,629 | ) | |||||||
| Loss before income taxes | (77,828 | ) | (64,837 | ) | (49,178 | ) | |||||
| Income tax provision | (1,533 | ) | (1,724 | ) | (859 | ) | |||||
| Net loss | $ | (79,361 | ) | $ | (66,561 | ) | $ | (50,037 | ) | ||
| Net loss available to common stockholders | |||||||||||
| Net loss | (79,361 | ) | (66,561 | ) | (50,037 | ) | |||||
| Convertible redeemable preferred stock dividends | (16,270 | ) | (15,513 | ) | (12,623 | ) | |||||
| Total net loss available to common stockholders | $ | (95,631 | ) | $ | (82,074 | ) | $ | (62,660 | ) | ||
| Net loss per common share (3): | |||||||||||
| Basic and diluted | $ | (19.88 | ) | $ | (17.71 | ) | $ | (15.51 | ) | ||
| Weighted-average number of shares used in per share calculation - Common Stock (3): | |||||||||||
| Basic and diluted | 4,811,233 | 4,634,178 | 4,040,102 | ||||||||
| Comprehensive loss: | |||||||||||
| Net loss | $ | (79,361 | ) | $ | (66,561 | ) | $ | (50,037 | ) | ||
| Other comprehensive loss: | |||||||||||
| Foreign currency cumulative translation adjustment | 1,830 | (3,842 | ) | (5,068 | ) | ||||||
| Total comprehensive loss | $ | (77,531 | ) | $ | (70,403 | ) | $ | (55,105 | ) | ||
(1) Excludes amortization of intangible assets, which is presented separately in the Consolidated Statements of Operations and Comprehensive Loss.
(2) Stock-based compensation expense is included in the line items above as follows:
| Years Ended December 31, | |||||||||||
| 2023 | 2022 | 2021 | |||||||||
| Cost of revenues | $ | 533 | $ | 1,144 | $ | 1,603 | |||||
| Selling and marketing | 380 | 1,021 | 1,791 | ||||||||
| Research and development | 411 | 827 | 1,079 | ||||||||
| General and administrative | 3,211 | 5,186 | 9,375 | ||||||||
| Total stock-based compensation expense | $ | 4,535 | $ | 8,178 | $ | 13,848 | |||||
(3) Adjusted retroactively for the Reverse Stock Split.
| COMSCORE, INC. | |||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (In thousands) | |||||||||||
| Years Ended December 31, | |||||||||||
| 2023 | 2022 | 2021 | |||||||||
| Operating activities: | |||||||||||
| Net loss | $ | (79,361 | ) | $ | (66,561 | ) | $ | (50,037 | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
| Impairment of goodwill | 78,200 | 46,300 | — | ||||||||
| Depreciation | 19,778 | 16,828 | 15,793 | ||||||||
| Non-cash operating lease expense | 5,456 | 6,060 | 5,345 | ||||||||
| Amortization of intangible assets | 5,213 | 27,096 | 25,038 | ||||||||
| Stock-based compensation expense | 4,535 | 8,178 | 13,848 | ||||||||
| Amortization expense of finance leases | 1,929 | 2,364 | 2,188 | ||||||||
| Impairment of right-of-use and long-lived assets | 1,502 | 156 | — | ||||||||
| Change in fair value of contingent consideration liability | 350 | 2,558 | — | ||||||||
| Deferred tax provision | (35 | ) | (475 | ) | (1,719 | ) | |||||
| Change in fair value of warrant liability | (49 | ) | (9,802 | ) | 7,689 | ||||||
| Loss on extinguishment of debt | — | — | 9,629 | ||||||||
| Non-cash interest expense on senior secured convertible notes | — | — | 4,692 | ||||||||
| Accretion of debt discount | — | — | 1,620 | ||||||||
| Change in fair value of financing derivatives | — | — | (1,800 | ) | |||||||
| Other | 1,947 | 1,910 | 1,380 | ||||||||
| Changes in operating assets and liabilities, net of effect of acquisition: | |||||||||||
| Accounts receivable | 4,781 | 2,596 | (2,081 | ) | |||||||
| Prepaid expenses and other assets | 2,185 | (805 | ) | (1,145 | ) | ||||||
| Accounts payable, accrued expenses, and other liabilities | (4,121 | ) | 7,396 | (4,210 | ) | ||||||
| Contract liability and customer advances | (5,517 | ) | (1,587 | ) | (10,777 | ) | |||||
| Operating lease liabilities | (7,867 | ) | (7,275 | ) | (5,597 | ) | |||||
| Net cash provided by operating activities | 28,926 | 34,937 | 9,856 | ||||||||
| Investing activities: | |||||||||||
| Capitalized internal-use software costs | (22,206 | ) | (16,685 | ) | (14,747 | ) | |||||
| Purchases of property and equipment | (1,580 | ) | (1,137 | ) | (803 | ) | |||||
| Cash and restricted cash acquired from acquisition | — | — | 902 | ||||||||
| Net cash used in investing activities | (23,786 | ) | (17,822 | ) | (14,648 | ) | |||||
| Financing activities: | |||||||||||
| Principal payments on finance leases | (2,066 | ) | (2,519 | ) | (2,138 | ) | |||||
| Contingent consideration payment at initial value | (1,037 | ) | — | — | |||||||
| Payments for dividends on convertible redeemable preferred stock | — | (15,512 | ) | (4,760 | ) | ||||||
| Principal payment and extinguishment costs on senior secured convertible notes | — | — | (204,014 | ) | |||||||
| Principal payment and extinguishment costs on secured term note | — | — | (14,031 | ) | |||||||
| Proceeds from borrowings on revolving line of credit | — | — | 16,000 | ||||||||
| Proceeds from issuance of convertible redeemable preferred stock, net of issuance costs | — | — | 187,885 | ||||||||
| Other | (291 | ) | (101 | ) | (1,394 | ) | |||||
| Net cash used in financing activities | (3,394 | ) | (18,132 | ) | (22,452 | ) | |||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 748 | (820 | ) | (1,218 | ) | ||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 2,494 | (1,837 | ) | (28,462 | ) | ||||||
| Cash, cash equivalents and restricted cash at beginning of period | 20,442 | 22,279 | 50,741 | ||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 22,936 | $ | 20,442 | $ | 22,279 | |||||
| As of December 31, | |||||||||||
| 2023 | 2022 | 2021 | |||||||||
| Cash and cash equivalents | $ | 22,750 | $ | 20,044 | $ | 21,854 | |||||
| Restricted cash | 186 | 398 | 425 | ||||||||
| Total cash, cash equivalents and restricted cash | $ | 22,936 | $ | 20,442 | $ | 22,279 | |||||
Reconciliation of Non-GAAP Financial Measures
The following table presents a reconciliation of GAAP net loss and net loss margin to non-GAAP adjusted EBITDA, adjusted EBITDA margin and non-GAAP FX adjusted EBITDA for each of the periods identified:
| Years Ended December 31, | |||||||||||
| 2023 | 2022 | 2021 | |||||||||
| (In thousands) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||
| GAAP net loss | $ | (79,361 | ) | $ | (66,561 | ) | $ | (50,037 | ) | ||
| Depreciation | 19,778 | 16,828 | 15,793 | ||||||||
| Amortization of intangible assets | 5,213 | 27,096 | 25,038 | ||||||||
| Amortization expense of finance leases | 1,929 | 2,364 | 2,188 | ||||||||
| Income tax provision | 1,533 | 1,724 | 859 | ||||||||
| Interest expense, net | 1,445 | 915 | 7,801 | ||||||||
| EBITDA | (49,463 | ) | (17,634 | ) | 1,642 | ||||||
| Adjustments: | |||||||||||
| Impairment of goodwill | 78,200 | 46,300 | — | ||||||||
| Restructuring | 6,234 | 5,810 | — | ||||||||
| Stock-based compensation expense | 4,535 | 8,178 | 13,848 | ||||||||
| Impairment of right-of-use and long-lived assets | 1,502 | 156 | — | ||||||||
| Amortization of cloud-computing implementation costs | 1,439 | 1,435 | 712 | ||||||||
| Transformation costs (1) | 1,283 | 460 | — | ||||||||
| Change in fair value of contingent consideration liability | 350 | 2,558 | — | ||||||||
| Loss on extinguishment of debt | — | — | 9,629 | ||||||||
| Loss on asset disposition | — | 7 | — | ||||||||
| Other (income) expense, net (2) | (49 | ) | (9,802 | ) | 6,039 | ||||||
| Non-GAAP adjusted EBITDA | $ | 44,031 | $ | 37,468 | $ | 31,870 | |||||
| Net loss margin (3) | (21.4 | )% | (17.7 | )% | (13.6 | )% | |||||
| Non-GAAP adjusted EBITDA margin (4) | 11.9 | % | 10.0 | % | 8.7 | % | |||||
| Adjustments: | |||||||||||
| Loss (gain) from foreign currency transactions | 2,824 | (1,166 | ) | (2,895 | ) | ||||||
| Non-GAAP FX adjusted EBITDA | $ | 46,855 | $ | 36,302 | $ | 28,975 | |||||
(1) Transformation costs represent expenses incurred prior to formal launch of identified strategic projects with anticipated long-term benefits to the company. These costs generally relate to third-party consulting and non-capitalizable technology costs tied directly to the identified projects. We added transformation costs as an adjustment in 2023 for greater transparency around these costs and have applied the adjustment to prior periods for comparison.
(2) Adjustments to other (income) expense, net reflect non-cash changes in the fair value of warrants liability, financing derivatives, and interest make-whole derivative included in other income (expense), net on our Consolidated Statements of Operations and Comprehensive Loss.
(3) Net loss margin is calculated by dividing net loss by revenues reported on our Consolidated Statements of Operations and Comprehensive Loss for the applicable period.
(4) Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenues reported on our Consolidated Statements of Operations and Comprehensive Loss for the applicable period.
| COMSCORE, INC. | |||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | |||||||
| (Unaudited) | |||||||
| (In thousands, except share and per share data) | |||||||
| Three Months Ended December 31, | |||||||
| 2023 | 2022 | ||||||
| Revenues | $ | 95,101 | $ | 98,240 | |||
| Cost of revenues (1) (2) | 50,220 | 49,379 | |||||
| Selling and marketing (1) (2) | 14,338 | 16,603 | |||||
| Research and development (1) (2) | 7,909 | 8,797 | |||||
| General and administrative (1) (2) | 11,416 | 13,081 | |||||
| Amortization of intangible assets | 801 | 6,773 | |||||
| Impairment of goodwill | 34,100 | — | |||||
| Restructuring | 779 | 26 | |||||
| Impairment of right-of-use and long-lived assets | — | 156 | |||||
| Total expenses from operations | 119,563 | 94,815 | |||||
| (Loss) income from operations | (24,462 | ) | 3,425 | ||||
| Interest expense, net | (304 | ) | (255 | ) | |||
| Other (expense) income, net | (383 | ) | 1,318 | ||||
| Loss from foreign currency transactions | (2,280 | ) | (4,562 | ) | |||
| Loss before income taxes | (27,429 | ) | (74 | ) | |||
| Income tax (provision) benefit | (970 | ) | 221 | ||||
| Net (loss) income | $ | (28,399 | ) | $ | 147 | ||
| Net loss available to common stockholders | |||||||
| Net (loss) income | (28,399 | ) | 147 | ||||
| Convertible redeemable preferred stock dividends | (4,287 | ) | (3,910 | ) | |||
| Total net loss available to common stockholders | $ | (32,686 | ) | $ | (3,763 | ) | |
| Net loss per common share (3): | |||||||
| Basic and diluted | $ | (6.69 | ) | $ | (0.80 | ) | |
| Weighted-average number of shares used in per share calculation - Common Stock (3): | |||||||
| Basic and diluted | 4,888,089 | 4,679,038 | |||||
| Comprehensive (loss) income: | |||||||
| Net (loss) income | $ | (28,399 | ) | $ | 147 | ||
| Other comprehensive (loss) income: | |||||||
| Foreign currency cumulative translation adjustment | 2,699 | 5,796 | |||||
| Total comprehensive (loss) income | $ | (25,700 | ) | $ | 5,943 | ||
(1) Excludes amortization of intangible assets, which is presented separately in the Consolidated Statements of Operations and Comprehensive Income.
(2) Stock-based compensation expense is included in the line items above as follows:
| Three Months Ended December 31, | |||||||
| 2023 | 2022 | ||||||
| Cost of revenues | $ | 98 | $ | 267 | |||
| Selling and marketing | (31 | ) | 217 | ||||
| Research and development | 78 | 200 | |||||
| General and administrative | 571 | 280 | |||||
| Total stock-based compensation expense | $ | 716 | $ | 964 | |||
(3) Adjusted retroactively for the Reverse Stock Split.
Reconciliation of Non-GAAP Financial Measures
The following table presents a reconciliation of GAAP net (loss) income and net (loss) income margin to non-GAAP adjusted EBITDA, adjusted EBITDA margin and non-GAAP FX adjusted EBITDA for each of the periods identified:
| Three Months Ended December 31, | |||||||
| 2023 | 2022 | ||||||
| (In thousands) | (Unaudited) | (Unaudited) | |||||
| GAAP net (loss) income | $ | (28,399 | ) | $ | 147 | ||
| Depreciation | 5,165 | 4,286 | |||||
| Income tax provision (benefit) | 970 | (221 | ) | ||||
| Amortization of intangible assets | 801 | 6,773 | |||||
| Amortization expense of finance leases | 661 | 489 | |||||
| Interest expense, net | 304 | 255 | |||||
| EBITDA | (20,498 | ) | 11,729 | ||||
| Adjustments: | |||||||
| Impairment of goodwill | 34,100 | — | |||||
| Restructuring | 779 | 26 | |||||
| Stock-based compensation expense | 716 | 964 | |||||
| Transformation costs (1) | 530 | — | |||||
| Amortization of cloud-computing implementation costs | 361 | 359 | |||||
| Change in fair value of contingent consideration liability | 98 | 111 | |||||
| Impairment of right-of-use and long-lived assets | — | 156 | |||||
| Other expense (income), net (2) | 358 | (1,324 | ) | ||||
| Non-GAAP adjusted EBITDA | $ | 16,444 | $ | 12,021 | |||
| Net (loss) income margin (3) | (29.9 | )% | 0.1 | % | |||
| Non-GAAP adjusted EBITDA margin (4) | 17.3 | % | 12.2 | % | |||
| Adjustments: | |||||||
| Loss from foreign currency transactions | 2,280 | 4,562 | |||||
| Non-GAAP FX adjusted EBITDA | $ | 18,724 | $ | 16,583 | |||
(1) Transformation costs represent expenses incurred prior to formal launch of identified strategic projects with anticipated long-term benefits to the company. These costs generally relate to third-party consulting and non-capitalizable technology costs tied directly to the identified projects. We added transformation costs as an adjustment in 2023 for greater transparency around these costs. There were no transformation costs in the three months ended December 31, 2022.
(2) Adjustments to other expense (income), net reflect non-cash changes in the fair value of warrants liability included in other (expense) income, net on our Consolidated Statements of Operations and Comprehensive Income.
(3) Net (loss) income margin is calculated by dividing net (loss) income by revenues reported on our Consolidated Statements of Operations and Comprehensive (Loss) Income for the applicable period.
(4) Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenues reported on our Consolidated Statements of Operations and Comprehensive (Loss) Income for the applicable period.
Revenues
Revenues from our two offerings of products and services are as follows:
| Years Ended December 31, | |||||||||||||||||||||||
| (In thousands) | 2023 | % of Revenue | 2022 | % of Revenue | $ Variance | % Variance | |||||||||||||||||
| Digital Ad Solutions | $ | 208,833 | 56.2 | % | $ | 212,510 | 56.5 | % | $ | (3,677 | ) | (1.7 | ) | % | |||||||||
| Cross Platform Solutions(1) | 162,510 | 43.8 | % | 163,913 | 43.5 | % | (1,403 | ) | (0.9 | ) | % | ||||||||||||
| Total revenues | $ | 371,343 | 100.0 | % | $ | 376,423 | 100.0 | % | $ | (5,080 | ) | (1.3 | ) | % | |||||||||
(1) Cross Platform Solutions revenue includes revenue from our movies business, which grew from
| Three Months Ended December 31, | |||||||||||||||||||||||
| (In thousands) | 2023 (Unaudited) | % of Revenue | 2022 (Unaudited) | % of Revenue | $ Variance | % Variance | |||||||||||||||||
| Digital Ad Solutions | $ | 55,236 | 58.1 | % | $ | 55,383 | 56.4 | % | $ | (147 | ) | (0.3 | ) | % | |||||||||
| Cross Platform Solutions(1) | 39,865 | 41.9 | % | 42,857 | 43.6 | % | (2,992 | ) | (7.0 | ) | % | ||||||||||||
| Total revenues | $ | 95,101 | 100.0 | % | $ | 98,240 | 100.0 | % | $ | (3,139 | ) | (3.2 | ) | % | |||||||||
(1) Cross Platform Solutions revenue includes revenue from our movies business, which grew from
| Three Months Ended (Unaudited) | Year Ended | ||||||||||||||||||||||
| (In thousands) | March 31, 2023 | June 30, 2023 | September 30, 2023 | December 31, 2023 | December 31, 2023 | % of Total 2023 Revenue | |||||||||||||||||
| Digital Ad Solutions | $ | 50,447 | $ | 52,649 | $ | 50,501 | $ | 55,236 | $ | 208,833 | 56.2 | % | |||||||||||
| Cross Platform Solutions | 41,111 | 41,035 | 40,499 | 39,865 | 162,510 | 43.8 | % | ||||||||||||||||
| Total revenues | $ | 91,558 | $ | 93,684 | $ | 91,000 | $ | 95,101 | $ | 371,343 | 100.0 | % | |||||||||||
FAQ
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