Ziff Davis Reports Third Quarter 2024 Financial Results and Reaffirms 2024 Guidance
Ziff Davis (NASDAQ: ZD) reported Q3 2024 financial results with revenue increasing 3.7% to $353.6 million. Despite revenue growth, the company recorded a net loss of $48.6 million, largely due to an $85.3 million goodwill impairment. Adjusted EBITDA grew 9.6% to $124.7 million, and adjusted net income increased 4.3% to $72.1 million. The Digital Media segment showed 5.8% growth, while Cybersecurity and Martech declined 4.1%. Free cash flow improved significantly to $80.1 million, up from $45.6 million in Q3 2023. The company maintained its 2024 guidance with expected revenue between $1,411.0-$1,471.0 million.
Ziff Davis (NASDAQ: ZD) ha riportato i risultati finanziari del terzo trimestre 2024, con un aumento del fatturato del 3,7% a 353,6 milioni di dollari. Nonostante la crescita dei ricavi, l'azienda ha registrato una perdita netta di 48,6 milioni di dollari, principalmente a causa di un impairment degli avviamenti di 85,3 milioni di dollari. L'EBITDA rettificato è cresciuto del 9,6% a 124,7 milioni di dollari, e l'utile netto rettificato è aumentato del 4,3% a 72,1 milioni di dollari. Il segmento Media Digitale ha mostrato una crescita del 5,8%, mentre Cybersecurity e Martech sono diminuiti del 4,1%. Il flusso di cassa libero è migliorato notevolmente a 80,1 milioni di dollari, rispetto ai 45,6 milioni di dollari nel terzo trimestre 2023. L'azienda ha mantenuto le previsioni per il 2024, con un fatturato atteso tra 1.411,0 e 1.471,0 milioni di dollari.
Ziff Davis (NASDAQ: ZD) informó los resultados financieros del tercer trimestre de 2024, con un aumento del 3,7% en los ingresos, alcanzando 353,6 millones de dólares. A pesar del crecimiento en los ingresos, la compañía registró una pérdida neta de 48,6 millones de dólares, en gran parte debido a un deterioro del fondo de comercio de 85,3 millones de dólares. El EBITDA ajustado creció un 9,6% hasta 124,7 millones de dólares, y el ingreso neto ajustado aumentó un 4,3% a 72,1 millones de dólares. El segmento de Medios Digitales mostró un crecimiento del 5,8%, mientras que Ciberseguridad y Martech disminuyeron un 4,1%. El flujo de caja libre mejoró significativamente a 80,1 millones de dólares, en comparación con los 45,6 millones de dólares en el tercer trimestre de 2023. La compañía mantuvo su guía para 2024, con ingresos esperados entre 1.411,0 y 1.471,0 millones de dólares.
지프 데이비스 (NASDAQ: ZD)는 2024년 3분기 재무 결과를 보고했으며, 수익이 3.7% 증가하여 3억 5,360만 달러에 달했습니다. 수익 성장에도 불구하고, 회사는 4,860만 달러의 순손실을 기록했으며, 이는 주로 8,530만 달러의 상각 손실 때문입니다. 조정된 EBITDA는 9.6% 증가하여 1억 2,470만 달러에 이르렀고, 조정된 순이익은 4.3% 증가하여 7,210만 달러에 도달했습니다. 디지털 미디어 부문은 5.8% 성장했으며, 사이버 보안과 마케팅 기술 분야는 4.1% 감소했습니다. 자유 현금 흐름은 8,010만 달러로 크게 개선되어, 2023년 3분기에는 4,560만 달러였습니다. 회사는 2024년에 대한 가이던스를 유지했으며, 예상 수익은 14억 1,100만에서 14억 7,100만 달러 사이입니다.
Ziff Davis (NASDAQ: ZD) a annoncé les résultats financiers du troisième trimestre 2024, avec un chiffre d'affaires en hausse de 3,7% à 353,6 millions de dollars. Malgré la croissance des revenus, l'entreprise a enregistré une perte nette de 48,6 millions de dollars, principalement due à une dépréciation de goodwill de 85,3 millions de dollars. L'EBITDA ajusté a augmenté de 9,6% pour atteindre 124,7 millions de dollars, et le résultat net ajusté a augmenté de 4,3% pour atteindre 72,1 millions de dollars. Le segment Médias Numériques a montré une croissance de 5,8%, tandis que la Cybersécurité et le Martech ont diminué de 4,1%. Le flux de trésorerie libre s'est fortement amélioré à 80,1 millions de dollars, contre 45,6 millions de dollars au troisième trimestre 2023. L'entreprise a maintenu ses prévisions pour 2024, avec des revenus attendus entre 1.411,0 et 1.471,0 millions de dollars.
Ziff Davis (NASDAQ: ZD) berichtete über die finanziellen Ergebnisse für das dritte Quartal 2024, wobei die Einnahmen um 3,7% auf 353,6 Millionen Dollar stiegen. Trotz des Umsatzwachstums verzeichnete das Unternehmen einen Nettoverlust von 48,6 Millionen Dollar, der hauptsächlich auf eine Wertminderung des Firmenwerts in Höhe von 85,3 Millionen Dollar zurückzuführen ist. Das bereinigte EBITDA wuchs um 9,6% auf 124,7 Millionen Dollar, und der bereinigte Nettogewinn stieg um 4,3% auf 72,1 Millionen Dollar. Der Bereich Digitale Medien zeigte ein Wachstum von 5,8%, während die Bereiche Cybersicherheit und Martech um 4,1% zurückgingen. Der freie Cashflow verbesserte sich erheblich auf 80,1 Millionen Dollar, verglichen mit 45,6 Millionen Dollar im dritten Quartal 2023. Das Unternehmen hielt an seiner Prognose für 2024 fest, mit erwarteten Einnahmen von 1.411,0 bis 1.471,0 Millionen Dollar.
- Revenue increased 3.7% to $353.6 million
- Adjusted EBITDA grew 9.6% to $124.7 million
- Digital Media segment revenue up 5.8%
- Free cash flow increased 75.8% to $80.1 million
- Strong cash position of $538.9 million
- Net loss increased to $48.6 million from $31.0 million
- $85.3 million goodwill impairment charge
- Cybersecurity and Martech revenue declined 4.1%
- Operating loss margin worsened to -8.3% from -3.9%
Insights
Q3 2024 shows mixed results with some concerning elements. While revenues grew
The Digital Media segment performed well with
The divergence between GAAP and adjusted metrics warrants attention. While adjusted figures show improvement, the substantial goodwill impairment suggests potential overvaluation of past acquisitions. The company's strategic focus on share repurchases (
The improving EBITDA margin (
“We are very pleased with our third quarter results,” said Vivek Shah, Chief Executive Officer of Ziff Davis. “We are seeing improvements in the businesses that we currently own, as well as opportunities to leverage our strong balance sheet and free cash flows to acquire businesses that we would like to own.”
THIRD QUARTER 2024 RESULTS
-
Q3 2024 quarterly revenues increased
3.7% to$353.6 million $341.0 million
-
Loss from operations increased to
$29.3 million $13.3 million $85.3 million $56.9 million
-
Net loss (1) increased to
$48.6 million $31.0 million $85.3 million $56.9 million
-
Net loss per diluted share (1) increased to
$1.11 $0.67
-
Adjusted EBITDA (2) for the quarter increased
9.6% to$124.7 million $113.7 million
-
Adjusted net income (2) increased
4.3% to$72.1 million $69.1 million
-
Adjusted net income per diluted share (1)(2) (or “Adjusted diluted EPS”) for the quarter increased
9.3% to$1.64 $1.50
-
Net cash provided by operating activities was
$106.0 million $72.8 million $80.1 million $45.6 million
-
Ziff Davis ended the quarter with approximately
$538.9 million $96.1 million $154.9 million
The following table reflects results for the three and nine months ended September 30, 2024 and 2023, respectively (in millions, except per share amounts).
(Unaudited) |
Three months ended
|
% Change |
Nine months ended
|
% Change |
||
2024 |
2023 |
2024 |
2023 |
|||
Revenues |
|
|
|
|
|
|
Digital Media |
|
|
|
|
|
|
Cybersecurity and Martech |
|
|
(4.1)% |
|
|
(2.2)% |
Total revenues (3) |
|
|
|
|
|
|
(Loss) income from operations |
|
|
(120.0)% |
|
|
(32.3)% |
Operating (loss) income margin |
(8.3)% |
(3.9)% |
(4.4)% |
|
|
(1.7)% |
Net loss (1) |
|
|
|
|
|
(95.3)% |
Net loss per diluted share (1) |
|
|
|
|
|
(95.7)% |
Adjusted EBITDA (2) |
|
|
|
|
|
|
Adjusted EBITDA margin (2) |
|
|
|
|
|
|
Adjusted net income (1)(2) |
|
|
|
|
|
|
Adjusted diluted EPS (1)(2) |
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
|
|
|
|
Free cash flow (2) |
|
|
|
|
|
|
Notes:
(1) |
|
GAAP effective tax rates were approximately (34.9)% and (20.7)% for the three months ended September 30, 2024 and 2023, respectively, and |
(2) |
|
For definitions of non-GAAP financial measures and reconciliations of GAAP to non-GAAP financial measures refer to section “Non-GAAP Financial Measures” further in this release. |
(3) |
|
The revenues associated with each of the businesses may not foot precisely since each is presented independently. |
ZIFF DAVIS GUIDANCE
The Company reaffirms its guidance for fiscal year 2024 as follows (in millions, except per share data):
|
2024 Range of Estimates |
||||
|
Low |
|
High |
||
Revenue |
$ |
1,411.0 |
|
$ |
1,471.0 |
Adjusted EBITDA |
$ |
500.0 |
|
$ |
521.0 |
Adjusted diluted EPS* |
$ |
6.43 |
|
$ |
6.77 |
___________________
* Adjusted diluted EPS for 2024 excludes amortization of acquired intangibles and the impact of any currently unanticipated items, in each case net of tax. It is anticipated that the Adjusted effective tax rate for 2024 will be between
A reconciliation of forward-looking Adjusted EBITDA and Adjusted diluted EPS to the corresponding GAAP financial measures is not available without unreasonable effort due, primarily, to variability and difficulty in making accurate forecasts and projections of non-operating matters that may arise in the future.
Earnings Conference Call and Audio Webcast
Ziff Davis will host a live audio webcast and conference call discussing its third quarter 2024 financial results on Friday, November 8, 2024, at 8:30AM ET. The live webcast and call will be accessible by phone by dialing (844) 985-2014 or via www.ziffdavis.com. Following the event, the audio recording and presentation materials will be archived and made available at www.ziffdavis.com.
About Ziff Davis
Ziff Davis, Inc. (NASDAQ: ZD) is a vertically focused digital media and internet company whose portfolio includes leading brands in technology, shopping, gaming and entertainment, connectivity, health and wellness, cybersecurity, and martech. For more information, visit www.ziffdavis.com.
“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including those contained in Vivek Shah’s quote, the “Ziff Davis Guidance” section regarding the Company’s expected fiscal 2024 financial performance, and our discussion of net cash provided by operating activities and free cash flow. These forward-looking statements are based on management’s current expectations or beliefs and are subject to numerous assumptions, risks, and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These factors and uncertainties include, among other items: the Company’s ability to grow advertising, licensing, and subscription revenues, profitability, and cash flows, particularly in light of an uncertain
ZIFF DAVIS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED, IN THOUSANDS) |
|||||||
|
September 30, 2024 |
|
December 31, 2023 |
||||
ASSETS |
|
|
|
||||
Cash and cash equivalents |
$ |
386,122 |
|
|
$ |
737,612 |
|
Short-term investments |
|
— |
|
|
|
27,109 |
|
Accounts receivable, net of allowances of |
|
470,550 |
|
|
|
337,703 |
|
Prepaid expenses and other current assets |
|
94,345 |
|
|
|
88,570 |
|
Total current assets |
|
951,017 |
|
|
|
1,190,994 |
|
Long-term investments |
|
152,817 |
|
|
|
140,906 |
|
Property and equipment, net of accumulated depreciation of |
|
197,482 |
|
|
|
188,169 |
|
Intangible assets, net |
|
470,774 |
|
|
|
325,406 |
|
Goodwill |
|
1,572,854 |
|
|
|
1,546,065 |
|
Deferred income taxes |
|
8,622 |
|
|
|
8,731 |
|
Other assets |
|
65,879 |
|
|
|
70,751 |
|
TOTAL ASSETS |
$ |
3,419,445 |
|
|
$ |
3,471,022 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Accounts payable |
$ |
371,498 |
|
|
$ |
123,256 |
|
Accrued employee related costs |
|
33,829 |
|
|
|
50,068 |
|
Other accrued liabilities |
|
36,557 |
|
|
|
43,612 |
|
Income taxes payable, current |
|
10,470 |
|
|
|
14,458 |
|
Deferred revenue, current |
|
204,029 |
|
|
|
184,549 |
|
Other current liabilities |
|
11,011 |
|
|
|
15,890 |
|
Total current liabilities |
|
667,394 |
|
|
|
431,833 |
|
Long-term debt |
|
863,741 |
|
|
|
1,001,312 |
|
Deferred income taxes |
|
53,577 |
|
|
|
45,503 |
|
Income taxes payable, noncurrent |
|
— |
|
|
|
8,486 |
|
Deferred revenue, noncurrent |
|
7,513 |
|
|
|
8,169 |
|
Other long-term liabilities |
|
74,908 |
|
|
|
82,721 |
|
TOTAL LIABILITIES |
|
1,667,133 |
|
|
|
1,578,024 |
|
|
|
|
|
||||
Common stock |
|
427 |
|
|
|
461 |
|
Additional paid-in capital |
|
480,271 |
|
|
|
472,201 |
|
Retained earnings |
|
1,335,083 |
|
|
|
1,491,956 |
|
Accumulated other comprehensive loss |
|
(63,469 |
) |
|
|
(71,620 |
) |
TOTAL STOCKHOLDERS’ EQUITY |
|
1,752,312 |
|
|
|
1,892,998 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
3,419,445 |
|
|
$ |
3,471,022 |
|
ZIFF DAVIS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED, IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA) |
|||||||||||||||
|
Three months ended September 30, |
|
Nine months ended September 30, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Total revenues |
$ |
353,580 |
|
|
$ |
340,985 |
|
|
$ |
988,865 |
|
|
$ |
974,143 |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
||||||||
Direct costs |
|
53,243 |
|
|
|
55,526 |
|
|
|
152,900 |
|
|
|
148,677 |
|
Sales and marketing |
|
127,418 |
|
|
|
125,062 |
|
|
|
369,184 |
|
|
|
360,916 |
|
Research, development, and engineering |
|
15,255 |
|
|
|
17,597 |
|
|
|
49,824 |
|
|
|
53,328 |
|
General, administrative, and other related costs |
|
101,695 |
|
|
|
99,269 |
|
|
|
296,558 |
|
|
|
302,481 |
|
Goodwill impairment on business |
|
85,273 |
|
|
|
56,850 |
|
|
|
85,273 |
|
|
|
56,850 |
|
Total operating costs and expenses |
|
382,884 |
|
|
|
354,304 |
|
|
|
953,739 |
|
|
|
922,252 |
|
(Loss) income from operations |
|
(29,304 |
) |
|
|
(13,319 |
) |
|
|
35,126 |
|
|
|
51,891 |
|
Interest expense, net |
|
(4,024 |
) |
|
|
(2,817 |
) |
|
|
(7,597 |
) |
|
|
(17,780 |
) |
Loss on sale of businesses |
|
— |
|
|
|
— |
|
|
|
(3,780 |
) |
|
|
— |
|
Loss on investments, net |
|
— |
|
|
|
(6,019 |
) |
|
|
(7,654 |
) |
|
|
(29,203 |
) |
Other (loss) income, net |
|
(2,633 |
) |
|
|
(3,571 |
) |
|
|
2,530 |
|
|
|
(5,982 |
) |
(Loss) income before income tax expense and (loss) income from equity method investment |
|
(35,961 |
) |
|
|
(25,726 |
) |
|
|
18,625 |
|
|
|
(1,074 |
) |
Income tax expense |
|
(12,539 |
) |
|
|
(5,335 |
) |
|
|
(27,760 |
) |
|
|
(11,180 |
) |
(Loss) income from equity method investment, net of tax |
|
(77 |
) |
|
|
90 |
|
|
|
8,095 |
|
|
|
(9,665 |
) |
Net loss |
$ |
(48,577 |
) |
|
$ |
(30,971 |
) |
|
$ |
(1,040 |
) |
|
$ |
(21,919 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per common share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
(1.11 |
) |
|
$ |
(0.67 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.47 |
) |
Diluted |
$ |
(1.11 |
) |
|
$ |
(0.67 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.47 |
) |
Weighted average shares outstanding: |
|
|
|
|
|
|
|
||||||||
Basic |
|
43,924,158 |
|
|
|
46,062,097 |
|
|
|
45,088,272 |
|
|
|
46,612,660 |
|
Diluted |
|
43,924,158 |
|
|
|
46,062,097 |
|
|
|
45,088,272 |
|
|
|
46,612,660 |
|
ZIFF DAVIS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED, IN THOUSANDS) |
|||||||
|
Nine months ended September 30, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
||||
Net loss |
$ |
(1,040 |
) |
|
$ |
(21,919 |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
151,945 |
|
|
|
167,333 |
|
Non-cash operating lease costs |
|
8,392 |
|
|
|
7,248 |
|
Share-based compensation |
|
30,633 |
|
|
|
24,393 |
|
Provision for credit losses on accounts receivable |
|
2,289 |
|
|
|
2,296 |
|
Deferred income taxes |
|
(14,575 |
) |
|
|
(25,658 |
) |
Loss on sale of businesses |
|
3,780 |
|
|
|
— |
|
Goodwill impairment on business |
|
85,273 |
|
|
|
56,850 |
|
(Income) loss from equity method investments, net |
|
(8,095 |
) |
|
|
9,665 |
|
Loss on investments, net |
|
7,654 |
|
|
|
29,203 |
|
Other |
|
2,390 |
|
|
|
5,113 |
|
Decrease (increase) in: |
|
|
|
||||
Accounts receivable |
|
46,576 |
|
|
|
11,043 |
|
Prepaid expenses and other current assets |
|
(8,152 |
) |
|
|
(10,059 |
) |
Other assets |
|
(2,794 |
) |
|
|
(7,961 |
) |
Increase (decrease) in: |
|
|
|
||||
Accounts payable |
|
(66,313 |
) |
|
|
1,955 |
|
Deferred revenue |
|
9,269 |
|
|
|
(6,820 |
) |
Accrued liabilities and other current liabilities |
|
(15,150 |
) |
|
|
(14,839 |
) |
Net cash provided by operating activities |
|
232,082 |
|
|
|
227,843 |
|
Cash flows from investing activities: |
|
|
|
||||
Purchases of property and equipment |
|
(79,476 |
) |
|
|
(82,476 |
) |
Acquisition of businesses, net of cash received |
|
(211,526 |
) |
|
|
(9,492 |
) |
Purchases of equity method investment |
|
— |
|
|
|
(11,790 |
) |
Proceeds from sale of equity investments |
|
19,455 |
|
|
|
3,174 |
|
Proceeds on sale of business, net of cash divested |
|
7,860 |
|
|
|
— |
|
Other |
|
(884 |
) |
|
|
(4,154 |
) |
Net cash used in investing activities |
|
(264,571 |
) |
|
|
(104,738 |
) |
Cash flows from financing activities: |
|
|
|
||||
Payment of debt |
|
(134,989 |
) |
|
|
— |
|
Repurchase of common stock |
|
(183,981 |
) |
|
|
(107,341 |
) |
Issuance of common stock under employee stock purchase plan |
|
4,525 |
|
|
|
4,725 |
|
Deferred payments for acquisitions |
|
(7,442 |
) |
|
|
(14,141 |
) |
Other |
|
(1,209 |
) |
|
|
(53 |
) |
Net cash used in financing activities |
|
(323,096 |
) |
|
|
(116,810 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
4,095 |
|
|
|
1,536 |
|
Net change in cash and cash equivalents |
|
(351,490 |
) |
|
|
7,831 |
|
Cash and cash equivalents at beginning of year |
|
737,612 |
|
|
|
652,793 |
|
Cash and cash equivalents at end of year |
$ |
386,122 |
|
|
$ |
660,624 |
|
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with
We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results or, in certain cases, may be non-cash in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to our historical performance and liquidity. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making, (2) certain measures are used to determine the amount of annual incentive compensation paid to our named executive officers, and (3) they are used by the analyst community to help them analyze the health of our business.
These non-GAAP financial measures are not measures presented in accordance with GAAP, and our use of these terms may vary from that of other companies, limiting their usefulness for comparison purposes. These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. These non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations determined in accordance with GAAP.
Non-GAAP financial measures exclude the certain items listed below. We believe that excluding these items from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which exclude similar items. We believe that non-GAAP financial measures provide meaningful supplemental information regarding operational performance. We further believe these measures are useful to investors in that they allow for greater transparency of certain line items in the Company’s financial statements.
Adjusted EBITDA is defined as Net income (loss) with adjustments to reflect the addition or elimination of certain items including, but not limited to:
- Interest expense, net. Interest expense is generated primarily from interest due on outstanding debt, partially offset by interest income generated from the interest earned on cash, cash equivalents, and investments;
- (Gain) loss on debt extinguishment, net. This is a non-cash expense that relates to extinguishments of long-term debt obligations. We believe this (gain) loss does not represent recurring core business operating results of the Company;
- (Gain) loss on sale of business. This gain or loss relates to the sales of businesses and does not represent recurring core business operating results of the Company;
- (Gain) loss on investments, net. This item includes realized gains and losses, unrealized gains and losses, and impairment charges on debt and equity investments. The amount of gain or loss depends on the share price for investments with readily determinable fair value and on observable price changes for investments without a readily determinable fair value, and does not represent core business operating results of the Company;
- Other (income) loss, net. This income or expense relates to other non-operating items and does not represent recurring core business operating results of the Company;
- Income tax (benefit) expense. This benefit or expense depends on the pre-tax loss or income of the Company, statutory tax rates, tax regulations, and different tax rates in various jurisdictions in which the Company operates and which the Company does not have the control over;
- (Income) loss from equity method investments, net. This is a non-cash expense as it relates primarily to our investment in OCV Fund I, LP (the “Fund”). We believe that gain or loss resulting from our equity method investment does not represent core business operating results of the Company;
- Depreciation and amortization. This is a non-cash expense at it relates to use and associated reduction in value of certain assets including equipment, fixtures, and certain capitalized internal-used software and website development costs, and identifiable definite-lived intangible assets of the acquired businesses;
- Share-based compensation. This is a non-cash expense as it relates to awards granted under the various share-based incentive plans of the Company. We view the economic cost of share-based awards to be the dilution to our share base;
- Acquisition, integration, and other costs. Includes adjustments to contingent consideration, lease terminations, retention bonuses, other acquisition-specific items, and other costs, such as severance, third-party debt modification costs, and legal settlements. These expenses do not represent core business operating results of the Company;
- Disposal related costs. These are expenses associated with the disposal of certain businesses that do not represent core business operating results of the Company;
- Lease asset impairments and other charges. These expenses are incurred in connection with impaired right-of-use (“ROU”) assets of the Company. Associated expenses are comprised of insurance, utility, and other charges related to assets that are no longer in use, and partially offset by the sublease income earned. These expenses do not represent core business operating results of the Company; and
- Goodwill impairment on business. This is a non-cash expense that is recorded when the carrying value of the reporting unit exceeds its fair value and does not represent core business operating results of the Company.
Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by Total revenues.
Adjusted net income (loss) is defined as Net income (loss) with adjustments to reflect the addition or elimination of certain statement of operations items including, but not limited to:
-
Interest, net. This reflects the difference between the imputed and coupon interest expense associated with the
4.625% Senior Notes and a charge that the Company determined to be penalty interest associated with the1.75% Convertible Notes in each period presented, offset in part by a certain interest income earned by the Company. These net expenses do not represent core business operating results of the Company;
- (Gain) loss on debt extinguishment, net. This is a non-cash expense that relates to extinguishments of long-term debt obligations. We believe this gain or loss does not represent recurring core business operating results of the Company;
- (Gain) loss on sale of business. This gain or loss relates to the sales of businesses and does not represent recurring core business operating results of the Company;
- (Gain) loss on investments, net. This item includes realized gains and losses, unrealized gains and losses, and impairment charges on debt and equity investments. The amount of gain or loss depends on the share price for investments with readily determinable fair value and on observable price changes for investments without a readily determinable fair value, and does not represent core business operating results of the Company;
- (Income) loss from equity method investments, net. This is a non-cash income or expense as it relates primarily to our investment in the OCV Fund. We believe that gains or losses resulting from our equity method investment do not represent core business operating results of the Company;
- Amortization. Includes the amortization of patents and intangible assets that we acquired. This is a non-cash expense as it primarily relates to identifiable definite-lived intangible assets of the acquired businesses. We believe that acquired intangible assets represent cost incurred by the acquiree to build value prior to the acquisition and the amortization of this cost does not represent core business operating results of the Company;
- Share-based compensation. This is a non-cash expense as it relates to awards granted under the various incentive plans of the Company. We view the economic cost of share-based awards to be the dilution to our share base;
- Acquisition, integration, and other costs. Includes adjustments to contingent consideration, lease terminations, retention bonuses, other acquisition-specific items, and other costs, such as severance, third-party debt modification costs, and legal settlements. These expenses do not represent core business operating results of the Company;
- Disposal related costs. These are expenses associated with the disposal of certain businesses that do not represent core business operating results of the Company;
- Lease asset impairments and other charges. These expenses are incurred in connection with impaired ROU assets of the Company. Associated expenses are comprised of insurance, utility, and other charges related to assets that are no longer in use, and partially offset by the sublease income earned. These expenses do not represent core business operating results of the Company; and
- Goodwill impairment on business. This is a non-cash expense that is recorded when the carrying value of the reporting unit exceeds its fair value and does not represent core business operating results of the Company.
Adjusted net income (loss) per diluted share is calculated by dividing Adjusted net income (loss) by the diluted weighted average shares of common stock outstanding excluding the effect of convertible debt dilution.
Free cash flow is defined as Net cash provided by operating activities, less purchases of property and equipment, plus changes in contingent consideration (if any).
Adjusted effective tax rate is calculated based upon the GAAP effective tax rate with adjustments for the tax applicable to non-GAAP adjustments to Net income (loss), generally based upon the effective marginal tax rate of each adjustment.
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
|||||||||||||||
The following table sets forth a reconciliation of Net loss to Adjusted EBITDA: |
|||||||||||||||
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net loss |
$ |
(48,577 |
) |
|
$ |
(30,971 |
) |
|
$ |
(1,040 |
) |
|
$ |
(21,919 |
) |
Interest expense, net |
|
4,024 |
|
|
|
2,817 |
|
|
|
7,597 |
|
|
|
17,780 |
|
Loss on sale of businesses |
|
— |
|
|
|
— |
|
|
|
3,780 |
|
|
|
— |
|
Loss on investments, net |
|
— |
|
|
|
6,019 |
|
|
|
7,654 |
|
|
|
29,203 |
|
Other loss (income), net |
|
2,633 |
|
|
|
3,571 |
|
|
|
(2,530 |
) |
|
|
5,982 |
|
Income tax expense |
|
12,539 |
|
|
|
5,335 |
|
|
|
27,760 |
|
|
|
11,180 |
|
Loss (income) from equity method investments, net |
|
77 |
|
|
|
(90 |
) |
|
|
(8,095 |
) |
|
|
8,165 |
|
Depreciation and amortization |
|
51,351 |
|
|
|
55,854 |
|
|
|
151,945 |
|
|
|
167,333 |
|
Share-based compensation |
|
10,161 |
|
|
|
6,774 |
|
|
|
30,633 |
|
|
|
24,393 |
|
Acquisition, integration, and other costs |
|
6,705 |
|
|
|
4,457 |
|
|
|
16,808 |
|
|
|
11,351 |
|
Disposal related costs |
|
(22 |
) |
|
|
1,633 |
|
|
|
551 |
|
|
|
1,842 |
|
Lease asset impairments and other charges |
|
527 |
|
|
|
1,485 |
|
|
|
1,370 |
|
|
|
2,583 |
|
Goodwill impairment on business |
|
85,273 |
|
|
|
56,850 |
|
|
|
85,273 |
|
|
|
56,850 |
|
Adjusted EBITDA |
$ |
124,691 |
|
|
$ |
113,734 |
|
|
$ |
321,706 |
|
|
$ |
314,743 |
|
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
|||||||||||||||
The following table sets forth Revenues and a reconciliation of (Loss) income from operations to Adjusted EBITDA by segment: |
|||||||||||||||
|
Three months ended September 30, 2024 |
||||||||||||||
|
Digital
|
|
Cybersecurity
|
|
Corporate |
|
Total |
||||||||
Revenues |
$ |
283,554 |
|
|
$ |
70,026 |
|
$ |
— |
|
|
$ |
353,580 |
|
|
|
|
|
|
|
|
|
|
||||||||
(Loss) income from operations |
$ |
(24,750 |
) |
|
$ |
14,889 |
|
$ |
(19,443 |
) |
|
$ |
(29,304 |
) |
|
Depreciation and amortization |
|
43,339 |
|
|
|
7,979 |
|
|
33 |
|
|
|
51,351 |
|
|
Share-based compensation |
|
3,408 |
|
|
|
1,178 |
|
|
5,575 |
|
|
|
10,161 |
|
|
Acquisition, integration, and other costs |
|
3,753 |
|
|
|
476 |
|
|
2,476 |
|
|
|
6,705 |
|
|
Disposal related costs |
|
(390 |
) |
|
|
— |
|
|
368 |
|
|
|
(22 |
) |
|
Lease asset impairments and other charges |
|
429 |
|
|
|
98 |
|
|
— |
|
|
|
527 |
|
|
Goodwill impairment on a business |
|
85,273 |
|
|
|
— |
|
|
— |
|
|
|
85,273 |
|
|
Adjusted EBITDA |
$ |
111,062 |
|
|
$ |
24,620 |
|
$ |
(10,991 |
) |
|
$ |
124,691 |
|
|
|
Three months ended September 30, 2023 |
||||||||||||||
|
Digital
|
|
Cybersecurity
|
|
Corporate |
|
Total |
||||||||
Revenues |
$ |
267,934 |
|
|
$ |
73,051 |
|
$ |
— |
|
|
$ |
340,985 |
|
|
|
|
|
|
|
|
|
|
||||||||
(Loss) income from operations |
$ |
(12,922 |
) |
|
$ |
12,527 |
|
$ |
(12,924 |
) |
|
$ |
(13,319 |
) |
|
Depreciation and amortization |
|
44,907 |
|
|
|
10,941 |
|
|
6 |
|
|
|
55,854 |
|
|
Share-based compensation |
|
2,579 |
|
|
|
399 |
|
|
3,796 |
|
|
|
6,774 |
|
|
Acquisition, integration, and other costs |
|
4,138 |
|
|
|
263 |
|
|
56 |
|
|
|
4,457 |
|
|
Disposal related costs |
|
452 |
|
|
|
203 |
|
|
978 |
|
|
|
1,633 |
|
|
Lease asset impairments and other charges |
|
1,379 |
|
|
|
106 |
|
|
— |
|
|
|
1,485 |
|
|
Goodwill impairment on a business |
|
56,850 |
|
|
|
— |
|
|
— |
|
|
|
56,850 |
|
|
Adjusted EBITDA |
$ |
97,383 |
|
|
$ |
24,439 |
|
$ |
(8,088 |
) |
|
$ |
113,734 |
|
|
____________
Figures above are net of intercompany costs and revenues.
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) |
|||||||||||||||
The following table set forth a reconciliation of Net loss to Adjusted net income with adjustments presented on after-tax basis: |
|||||||||||||||
|
Three months ended September 30, |
||||||||||||||
|
|
2024 |
|
|
Per diluted
|
|
|
2023 |
|
|
Per diluted
|
||||
Net loss |
$ |
(48,577 |
) |
|
$ |
(1.11 |
) |
|
$ |
(30,971 |
) |
|
$ |
(0.67 |
) |
Interest, net |
|
60 |
|
|
|
— |
|
|
|
336 |
|
|
|
0.01 |
|
(Gain) loss on sale of business |
|
(9 |
) |
|
|
— |
|
|
|
3,433 |
|
|
|
0.07 |
|
Loss on investments, net |
|
— |
|
|
|
— |
|
|
|
4,465 |
|
|
|
0.10 |
|
Loss (income) from equity method investments, net |
|
77 |
|
|
|
— |
|
|
|
(90 |
) |
|
|
— |
|
Amortization |
|
20,748 |
|
|
|
0.47 |
|
|
|
25,070 |
|
|
|
0.55 |
|
Share-based compensation |
|
8,628 |
|
|
|
0.20 |
|
|
|
6,813 |
|
|
|
0.15 |
|
Acquisition, integration, and other costs |
|
5,455 |
|
|
|
0.13 |
|
|
|
1,334 |
|
|
|
0.03 |
|
Disposal related costs |
|
25 |
|
|
|
— |
|
|
|
1,144 |
|
|
|
0.02 |
|
Lease asset impairments and other charges |
|
381 |
|
|
|
0.01 |
|
|
|
689 |
|
|
|
0.01 |
|
Goodwill impairment on business |
|
85,273 |
|
|
|
1.94 |
|
|
|
56,850 |
|
|
|
1.23 |
|
Adjusted net income |
$ |
72,061 |
|
|
$ |
1.64 |
|
|
$ |
69,073 |
|
|
$ |
1.50 |
|
|
Nine months ended September 30, |
||||||||||||||
|
|
2024 |
|
|
Per diluted
|
|
|
2023 |
|
|
Per diluted
|
||||
Net loss |
$ |
(1,040 |
) |
|
$ |
(0.02 |
) |
|
$ |
(21,919 |
) |
|
$ |
(0.47 |
) |
Interest, net |
|
72 |
|
|
|
— |
|
|
|
5,901 |
|
|
|
0.13 |
|
Loss on sale of business |
|
103 |
|
|
|
— |
|
|
|
3,521 |
|
|
|
0.08 |
|
Loss on investments, net |
|
7,077 |
|
|
|
0.15 |
|
|
|
21,878 |
|
|
|
0.46 |
|
(Income) loss from equity method investments, net |
|
(8,095 |
) |
|
|
(0.18 |
) |
|
|
8,540 |
|
|
|
0.18 |
|
Amortization |
|
62,012 |
|
|
|
1.38 |
|
|
|
75,488 |
|
|
|
1.62 |
|
Share-based compensation |
|
25,835 |
|
|
|
0.57 |
|
|
|
20,811 |
|
|
|
0.44 |
|
Acquisition, integration, and other costs |
|
11,540 |
|
|
|
0.26 |
|
|
|
6,487 |
|
|
|
0.14 |
|
Disposal related costs |
|
457 |
|
|
|
0.01 |
|
|
|
1,300 |
|
|
|
0.03 |
|
Lease asset impairments and other charges |
|
1,038 |
|
|
|
0.02 |
|
|
|
1,519 |
|
|
|
0.03 |
|
Goodwill impairment on business |
|
85,273 |
|
|
|
1.89 |
|
|
|
56,850 |
|
|
|
1.22 |
|
Adjusted net income |
$ |
184,272 |
|
|
$ |
4.08 |
|
|
$ |
180,376 |
|
|
$ |
3.86 |
|
_____________________
* The reconciliation of Net income (loss) per diluted share to Adjusted net income per diluted share may not foot since each is calculated independently.
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
||||||||||||||||||||||||||||||||||||
The following are the adjustments to certain statement of operations items used to derive Adjusted net income, which we believe provide useful information about our operating results and enhance the overall understanding of past financial performance and future prospects of the Company. |
||||||||||||||||||||||||||||||||||||
|
Three months ended September 30, 2024 |
|||||||||||||||||||||||||||||||||||
|
GAAP
|
Adjustments |
Adjusted
|
|||||||||||||||||||||||||||||||||
|
Interest, net |
(Gain) loss on
|
(Gain) loss on
|
(Income) loss
|
Amortization |
Share-based
|
Acquisition,
|
Disposal
|
Lease asset
|
Goodwill
|
||||||||||||||||||||||||||
Direct costs |
$ |
(53,243 |
) |
$ |
— |
|
$ |
— |
|
$ |
— |
$ |
— |
$ |
59 |
|
$ |
68 |
|
$ |
64 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
$ |
(53,052 |
) |
|||
Sales and marketing |
$ |
(127,418 |
) |
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
|
1,014 |
|
|
3,216 |
|
|
— |
|
|
— |
|
|
— |
$ |
(123,188 |
) |
|||
Research, development, and engineering |
$ |
(15,255 |
) |
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
|
769 |
|
|
1,096 |
|
|
— |
|
|
— |
|
|
— |
$ |
(13,390 |
) |
|||
General, administrative, and other related costs |
$ |
(101,695 |
) |
|
— |
|
|
— |
|
|
— |
|
— |
|
28,444 |
|
|
8,310 |
|
|
2,329 |
|
|
(22 |
) |
|
527 |
|
|
— |
$ |
(62,107 |
) |
|||
Goodwill impairment on business |
$ |
(85,273 |
) |
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
85,273 |
$ |
— |
|
|||
Interest expense, net |
$ |
(4,024 |
) |
|
80 |
|
|
— |
|
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(3,944 |
) |
|||
Other loss, net |
$ |
(2,633 |
) |
|
— |
|
|
(13 |
) |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(2,646 |
) |
|||
Income tax expense (1) |
$ |
(12,539 |
) |
|
(20 |
) |
|
4 |
|
|
— |
|
— |
|
(7,755 |
) |
|
(1,533 |
) |
|
(1,250 |
) |
|
47 |
|
|
(146 |
) |
|
— |
$ |
(23,192 |
) |
|||
Loss from equity method investment, net |
$ |
(77 |
) |
|
— |
|
|
— |
|
|
— |
|
77 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|||
Total non-GAAP adjustments |
|
$ |
60 |
|
$ |
(9 |
) |
$ |
— |
$ |
77 |
$ |
20,748 |
|
$ |
8,628 |
|
$ |
5,455 |
|
$ |
25 |
|
$ |
381 |
|
$ |
85,273 |
|
|||||||
(1) |
Adjusted effective tax rate was approximately |
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
||||||||||||||||||||||||||||||||||||
|
Three months ended September 30, 2023 |
|||||||||||||||||||||||||||||||||||
|
GAAP
|
Adjustments |
Adjusted
|
|||||||||||||||||||||||||||||||||
|
Interest, net |
(Gain) loss on
|
(Gain) loss on
|
(Income) loss
|
Amortization |
Share-based
|
Acquisition,
|
Disposal
|
Lease asset
|
Goodwill
|
||||||||||||||||||||||||||
Direct costs |
$ |
(55,526 |
) |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
158 |
|
$ |
76 |
$ |
5 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
$ |
(55,287 |
) |
||
Sales and marketing |
$ |
(125,062 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
323 |
|
1,056 |
|
|
4 |
|
|
— |
|
|
— |
$ |
(123,679 |
) |
||
Research, development, and engineering |
$ |
(17,597 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
840 |
|
227 |
|
|
3 |
|
|
— |
|
|
— |
$ |
(16,527 |
) |
||
General, administrative, and other related costs |
$ |
(99,269 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
32,986 |
|
|
5,535 |
|
3,169 |
|
|
1,626 |
|
|
1,485 |
|
|
— |
$ |
(54,468 |
) |
||
Goodwill impairment on business |
$ |
(56,850 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
56,850 |
$ |
— |
|
||
Interest expense, net |
$ |
(2,817 |
) |
|
388 |
|
|
(538 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(2,967 |
) |
||
Loss on investments, net |
$ |
(6,019 |
) |
|
— |
|
|
— |
|
|
6,019 |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
||
Other (loss) income, net |
$ |
(3,571 |
) |
|
— |
|
|
5,115 |
|
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
1,544 |
|
||||
Income tax expense (1) |
$ |
(5,335 |
) |
|
(52 |
) |
|
(1,144 |
) |
|
(1,554 |
) |
|
— |
|
|
(8,074 |
) |
|
39 |
|
(3,123 |
) |
|
(489 |
) |
|
(796 |
) |
|
— |
$ |
(20,528 |
) |
||
Income from equity method investment, net |
$ |
90 |
|
|
— |
|
|
— |
|
|
— |
|
|
(90 |
) |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
||
Total non-GAAP adjustments |
|
$ |
336 |
|
$ |
3,433 |
|
$ |
4,465 |
|
$ |
(90 |
) |
$ |
25,070 |
|
$ |
6,813 |
$ |
1,334 |
|
$ |
1,144 |
|
$ |
689 |
|
$ |
56,850 |
|
||||||
(1) |
Adjusted effective tax rate was approximately |
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
||||||||||||||||||||||||||||||||||||
|
Nine months ended September 30, 2024 |
|||||||||||||||||||||||||||||||||||
|
GAAP
|
Adjustments |
Adjusted
|
|||||||||||||||||||||||||||||||||
|
Interest, net |
(Gain) loss on
|
(Gain) loss on
|
(Income) loss
|
Amortization |
Share-based
|
Acquisition,
|
Disposal
|
Lease asset
|
Goodwill
|
||||||||||||||||||||||||||
Direct costs |
$ |
(152,900 |
) |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
246 |
|
$ |
191 |
|
$ |
335 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
$ |
(152,128 |
) |
|
Sales and marketing |
$ |
(369,184 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,865 |
|
|
5,706 |
|
|
— |
|
|
— |
|
|
— |
$ |
(360,613 |
) |
|
Research, development, and engineering |
$ |
(49,824 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,930 |
|
|
2,590 |
|
|
40 |
|
|
— |
|
|
— |
$ |
(44,264 |
) |
|
General, administrative, and other related costs |
$ |
(296,558 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
82,537 |
|
|
24,647 |
|
|
8,177 |
|
|
511 |
|
|
1,370 |
|
|
— |
$ |
(179,316 |
) |
|
Goodwill impairment on business |
$ |
(85,273 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
85,273 |
$ |
— |
|
|
Interest expense, net |
$ |
(7,597 |
) |
|
96 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(7,501 |
) |
|
Loss on sale of business |
$ |
(3,780 |
) |
|
— |
|
|
3,780 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|
Loss on investments, net |
$ |
(7,654 |
) |
|
— |
|
|
— |
|
|
7,654 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|
Other income (loss), net |
$ |
2,530 |
|
|
— |
|
|
(4,903 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(537 |
) |
|
— |
|
|
— |
|
|
— |
$ |
(2,910 |
) |
|
Income tax expense |
$ |
(27,760 |
) |
|
(24 |
) |
|
1,226 |
|
|
(577 |
) |
|
— |
|
|
(20,771 |
) |
|
(4,798 |
) |
|
(4,731 |
) |
|
(94 |
) |
|
(332 |
) |
|
— |
$ |
(57,861 |
) |
|
Income from equity method investment, net |
$ |
8,095 |
|
|
— |
|
|
— |
|
|
— |
|
|
(8,095 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|
Total non-GAAP adjustments |
|
$ |
72 |
|
$ |
103 |
|
$ |
7,077 |
|
$ |
(8,095 |
) |
$ |
62,012 |
|
$ |
25,835 |
|
$ |
11,540 |
|
$ |
457 |
|
$ |
1,038 |
|
$ |
85,273 |
|
|||||
(1) |
Adjusted effective tax rate was approximately |
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
||||||||||||||||||||||||||||||||||||
|
Nine months ended September 30, 2023 |
|||||||||||||||||||||||||||||||||||
|
GAAP
|
Adjustments |
Adjusted
|
|||||||||||||||||||||||||||||||||
|
Interest,
|
(Gain) loss on
|
(Gain) loss on
|
(Income) loss
|
Amortization |
Share-based
|
Acquisition,
|
Disposal
|
Lease asset
|
Goodwill
|
||||||||||||||||||||||||||
Direct costs |
$ |
(148,677 |
) |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
543 |
|
$ |
246 |
|
$ |
191 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
$ |
(147,697 |
) |
|
Sales and marketing |
$ |
(360,916 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,285 |
|
|
3,128 |
|
|
4 |
|
|
— |
|
|
— |
$ |
(355,499 |
) |
|
Research, development, and engineering |
$ |
(53,328 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,581 |
|
|
535 |
|
|
3 |
|
|
— |
|
|
— |
$ |
(50,209 |
) |
|
General, administrative, and other related costs |
$ |
(302,481 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(1,500 |
) |
|
100,037 |
|
|
19,281 |
|
|
7,497 |
|
|
1,835 |
|
|
2,583 |
|
|
— |
$ |
(172,748 |
) |
|
Goodwill impairment on business |
$ |
(56,850 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
56,850 |
$ |
— |
|
|
Interest expense, net |
$ |
(17,780 |
) |
|
7,808 |
|
|
(538 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(10,510 |
) |
|
Loss on investments, net |
$ |
(29,203 |
) |
|
— |
|
|
— |
|
|
29,203 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|
Other loss, net |
$ |
(5,982 |
) |
|
— |
|
|
5,233 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
(749 |
) |
|
Income tax expense |
$ |
(11,180 |
) |
|
(1,907 |
) |
|
(1,174 |
) |
|
(7,325 |
) |
|
375 |
|
|
(25,092 |
) |
|
(3,582 |
) |
|
(4,864 |
) |
|
(542 |
) |
|
(1,064 |
) |
|
— |
$ |
(56,355 |
) |
|
Loss from equity method investment, net |
$ |
(9,665 |
) |
|
— |
|
|
— |
|
|
— |
|
|
9,665 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
$ |
— |
|
|
Total non-GAAP adjustments |
|
$ |
5,901 |
|
$ |
3,521 |
|
$ |
21,878 |
|
$ |
8,540 |
|
$ |
75,488 |
|
$ |
20,811 |
|
$ |
6,487 |
|
$ |
1,300 |
|
$ |
1,519 |
|
$ |
56,850 |
|
|||||
(1) |
Adjusted effective tax rate was approximately |
ZIFF DAVIS, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (UNAUDITED, IN THOUSANDS) |
||||||||||||||||||
The following tables set forth a reconciliation of Net cash provided by operating activities to Free cash flow: |
||||||||||||||||||
2024 |
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
YTD |
|||||||||
Net cash provided by operating activities |
$ |
75,558 |
|
|
$ |
50,564 |
|
|
$ |
105,960 |
|
|
$ |
— |
|
$ |
232,082 |
|
Less: Purchases of property and equipment |
|
(28,129 |
) |
|
|
(25,504 |
) |
|
|
(25,843 |
) |
|
|
— |
|
|
(79,476 |
) |
Free cash flow |
$ |
47,429 |
|
|
$ |
25,060 |
|
|
$ |
80,117 |
|
|
$ |
— |
|
$ |
152,606 |
|
2023 |
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
YTD |
||||||||||
Net cash provided by operating activities |
$ |
115,307 |
|
|
$ |
39,728 |
|
|
$ |
72,808 |
|
|
$ |
92,119 |
|
|
$ |
319,962 |
|
Less: Purchases of property and equipment |
|
(30,017 |
) |
|
|
(25,233 |
) |
|
|
(27,226 |
) |
|
|
(26,253 |
) |
|
|
(108,729 |
) |
Free cash flow |
$ |
85,290 |
|
|
$ |
14,495 |
|
|
$ |
45,582 |
|
|
$ |
65,866 |
|
|
$ |
211,233 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20241107725756/en/
Alan Steier
Investor Relations
Ziff Davis, Inc.
investor@ziffdavis.com
Rebecca Wright
Corporate Communications
Ziff Davis, Inc.
press@ziffdavis.com
Source: Ziff Davis, Inc.
FAQ
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