Marchex Announces First Quarter 2019 Results
Q1 2019 Financial Highlights
-
Revenue was
$26.4 million for the first quarter of 2019, compared to$21.9 million for the first quarter of 2018. -
Core analytics revenue was
$12.8 million for the first quarter of 2019, compared to$7.4 million for the first quarter of 2018. -
Net loss was
$1.3 million for the first quarter of 2019 or$0.03 per diluted share. For the first quarter of 2018, net loss was$0.9 million or$0.02 per diluted share.
Q1 2018 | Q1 2019 | |||
Revenue | $21.9 million | $26.4 million | ||
Net cash provided by operating activities | $3.0 million | $5.6 million | ||
Cash Balance | $84.6 million | $50.9 million | ||
Non-GAAP Results1: | ||||
Adjusted EBITDA | $0.3 million | $1.2 million |
-
Adjusted non-GAAP income (loss) per share1 for the first
quarter of 2019 was
$0.01 , compared to($0.00) for the first quarter of 2018.
1 |
Reconciliations of non-GAAP measures are included in the financial tables attached to this press release and we encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measures. |
|
Strategic Priorities Update
Grow New and Existing Client Relationships. In the first quarter,
Accelerate Product Innovation. Marchex Recently Launched Marchex Stream, its new platform that analyzes consumer-to-business conversational data, gains insights in real time and at meaningful scale, extracts signals of consumer intent and supports predictive analytics and the development of artificial intelligence-driven, use-case specific applications. With Marchex Stream, a customer’s journey can now be captured across its many touchpoints, including inbound and outbound phone calls, SMS, messaging and chat, in a single, unified platform and processed within seconds. Marchex Stream enables businesses to realize the full potential and value of conversational artificial intelligence and is introducing a new set of industry-leading capabilities, including: massive cloud-based conversational data storage and analytics scalability, new streaming capabilities enable processing events and extracting signals from conversations as they occur, a new rich API for developers and a multi-layered, cloud-based advanced security processes and techniques to provide the protection required to support enterprise level needs.
“Marchex is making important progress setting the foundation for
leadership in conversational analytics and sales acceleration
solutions,” said
Business Outlook
The following forward-looking statements reflect
-
For the second quarter, the Company anticipates
$12.8 million or more in Marchex’s core analytics revenue, representing a more than 50% increase year-over-year.
Financial Guidance for the Second Quarter
ending
Total Revenue | $25 million or more | |
Income (loss) from operations | ($3) million or better | |
Adjusted OIBA1, 2 | breakeven or better | |
Adjusted EBITDA1, 2 | $1 million or better |
2 |
Second quarter GAAP income (loss) from operations is expected to be ($3) million or better, assuming stock-based compensation and amortization of intangibles between $2.8 million and $3 million for the quarter. |
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Conference Call and Webcast Information
Management will hold a conference call, starting at
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Forward-Looking Statements:
This press release contains forward-looking statements that involve
substantial risks and uncertainties. All statements, other than
statements of historical facts, included in this press release regarding
our strategy, future operations, future financial position, future
revenues, other financial guidance, acquisitions, dispositions,
projected costs, prospects, plans and objectives of management are
forward-looking statements. We may not actually achieve the plans,
intentions, or expectations disclosed in our forward-looking statements
and you should not place undue reliance on our forward-looking
statements. Actual results or events could differ materially from the
plans, intentions and expectations disclosed in the forward-looking
statements we make. There are a number of important factors that could
cause
In the event the press release contains links to third party websites or
materials, the links are provided solely as a convenience to you.
Non-GAAP Financial Information:
To supplement
Adjusted OIBA represents income
(loss) from operations excluding stock-based compensation expense,
amortization of intangible assets from acquisitions, and acquisition
related costs. This measure, among other things, is one of the primary
metrics by which
MARCHEX, INC. AND SUBSIDIARIES | ||||||||
Condensed Consolidated Statements of Operations | ||||||||
(in thousands, except per share amounts) | ||||||||
(unaudited) | ||||||||
Three Months Ended March 31, |
||||||||
2018 | 2019 | |||||||
Revenue | $ | 21,896 | $ | 26,406 | ||||
Expenses: | ||||||||
Service costs (1) | 12,823 | 14,258 | ||||||
Sales and marketing (1) | 3,610 | 4,113 | ||||||
Product development (1) | 3,648 | 4,568 | ||||||
General and administrative (1) | 2,970 | 3,320 | ||||||
Amortization of intangible assets from acquisitions | — | 1,568 | ||||||
Acquisition related costs | — | 182 | ||||||
Total operating expenses | 23,051 | 28,009 | ||||||
Loss from operations | (1,155 | ) | (1,603 | ) | ||||
Interest income and other, net | 240 | 185 | ||||||
Loss before provision for income taxes | (915 | ) | (1,418 | ) | ||||
Income tax expense (benefit) | 11 | (119 | ) | |||||
Net loss applicable to common stockholders | $ | (926 | ) | $ | (1,299 | ) | ||
Basic and diluted net loss per Class A and Class B share applicable
to common stockholders |
$ | (0.02 | ) | $ | (0.03 | ) | ||
Shares used to calculate basic net loss per share applicable to
common stockholders: |
||||||||
Class A | 5,056 | 5,056 | ||||||
Class B | 38,039 | 39,827 | ||||||
Shares used to calculate diluted net loss per share applicable
to common stockholders: |
||||||||
Class A | 5,056 | 5,056 | ||||||
Class B | 43,095 | 44,883 | ||||||
(1) Includes stock-based compensation allocated as follows: | ||||||||
Service costs | $ | 128 | $ | 59 | ||||
Sales and marketing | 214 | 177 | ||||||
Product development | 91 | 76 | ||||||
General and administrative | 518 | 233 | ||||||
Total | $ | 951 | $ | 545 | ||||
MARCHEX, INC. AND SUBSIDIARIES | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
(in thousands) | ||||||||
(unaudited) | ||||||||
December 31, | March 31, | |||||||
2018 | 2019 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 45,230 | $ | 50,906 | ||||
Accounts receivable, net | 16,198 | 14,716 | ||||||
Prepaid expenses and other current assets | 2,657 | 2,919 | ||||||
Total current assets | 64,085 | 68,541 | ||||||
Property and equipment, net | 2,921 | 2,774 | ||||||
Right-of-use lease asset | — | 7,065 | ||||||
Other assets, net | 917 | 848 | ||||||
Goodwill | 24,442 | 24,442 | ||||||
Intangible assets from acquisitions, net | 20,697 | 19,129 | ||||||
Total assets | $ | 113,062 | $ | 122,799 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 5,968 | $ | 6,687 | ||||
Accrued expenses and other current liabilities | 5,807 | 6,128 | ||||||
Current portion of acquisition-related liabilities | 1,215 | 1,276 | ||||||
Deferred revenue and deposits | 1,782 | 3,955 | ||||||
Lease liability current | — | 1,517 | ||||||
Total current liabilities | 14,772 | 19,563 | ||||||
Other non-current liabilities | 1,287 | 91 | ||||||
Deferred tax liabilities | 1,531 | 1,390 | ||||||
Lease liability non-current | — | 6,787 | ||||||
Non-current portion of acquisition-related liabilities | 446 | 502 | ||||||
Total liabilities | 18,036 | 28,333 | ||||||
Stockholders’ equity: | ||||||||
Class A common stock | 53 | 53 | ||||||
Class B common stock | 370 | 371 | ||||||
Treasury stock | — | (1 | ) | |||||
Additional paid-in capital | 350,801 | 351,540 | ||||||
Accumulated deficit | (256,198 | ) | (257,497 | ) | ||||
Total stockholders’ equity | 95,026 | 94,466 | ||||||
Total liabilities and stockholders’ equity | $ | 113,062 | $ | 122,799 | ||||
MARCHEX, INC. AND SUBSIDIARIES | ||||||||
(in thousands) | ||||||||
(unaudited) | ||||||||
Reconciliation of GAAP Loss from Operations to Adjusted Operating Income (Loss) Before Amortization (Adjusted OIBA) | ||||||||
Three Months Ended March 31, |
||||||||
2018 | 2019 | |||||||
Loss from operations | $ | (1,155 | ) | $ | (1,603 | ) | ||
Stock-based compensation | 951 | 545 | ||||||
Amortization of intangible assets from acquisitions | — | 1,568 | ||||||
Acquisition related costs | — | 182 | ||||||
Adjusted OIBA | $ | (204 | ) | $ | 692 |
Reconciliation from Net Cash provided by Operating Activities to Adjusted EBITDA |
||||||||
Three Months Ended March 31, |
||||||||
2018 | 2019 | |||||||
Net cash provided by operating activities | $ | 3,021 | $ | 5,624 | ||||
Changes in assets and liabilities | (2,471 | ) | (4,345 | ) | ||||
Income tax expense (benefit) | 11 | (119 | ) | |||||
Acquisition related costs | — | 182 | ||||||
Interest income and other, net | (240 | ) | (185 | ) | ||||
Adjusted EBITDA | $ | 321 | $ | 1,157 | ||||
Net cash used in investing activities | $ | (769 | ) | $ | (143 | ) | ||
Net cash provided by (used in) financing activities | $ | (21,880 | ) | $ | 195 |
Revenue Reconciliation |
|||||||
Three Months Ended March 31, |
|||||||
2018 | 2019 | ||||||
Core Analytics revenue1 | $ | 7,401 | $ | 12,784 | |||
Marketplace, Local Leads, and other analytics2 | 14,495 | 13,622 | |||||
Total Revenue | $ | 21,896 | $ | 26,406 |
1 | Core analytics revenue includes revenue from analytics customers, including those that are purchasing or buying products derived from the company’s speech technology platform. | |
2 | Includes revenue from marketplace, local leads and from tests, consulting services or other analytics revenues that may continue for a limited time but are not anticipated to continue in future periods. | |
MARCHEX, INC. AND SUBSIDIARIES | ||||||||
Reconciliation of GAAP Net Loss per Share to Adjusted Non-GAAP Loss per Share | ||||||||
(in thousands, except per share amounts) | ||||||||
(unaudited) | ||||||||
Three Months Ended March 31, |
||||||||
2018 | 2019 | |||||||
Adjusted Non-GAAP income (loss) per share | $ | (0.00 | ) | $ | 0.01 | |||
Net loss per share applicable to common stockholders - diluted
(GAAP loss per share) |
$ | (0.02 | ) | $ | (0.03 | ) | ||
Shares used to calculate diluted net loss per share applicable to
common stockholders |
43,095 | 44,883 | ||||||
Net loss applicable to common stockholders | $ | (926 | ) | $ | (1,299 | ) | ||
Stock-based compensation | 951 | 545 | ||||||
Acquisition related costs | — | 182 | ||||||
Amortization of intangible assets from acquisitions | — | 1,568 | ||||||
Interest income and other, net | (240 | ) | (185 | ) | ||||
Estimated impact of income taxes | 23 | (309 | ) | |||||
Adjusted Non-GAAP income (loss) | $ | (192 | ) | $ | 502 | |||
Adjusted Non-GAAP income (loss) per share | $ | (0.00 | ) | $ | 0.01 | |||
Shares used to calculate diluted net loss per share applicable to
common stockholders (GAAP) |
43,095 | 44,883 | ||||||
Weighted average stock options and common shares subject to
purchase or cancellation (if applicable) |
— | 756 | ||||||
Diluted shares used to calculate Adjusted Non-GAAP income (loss) per share1 | 43,095 | 45,639 |
1 | For the purpose of computing the number of diluted shares for Adjusted Non-GAAP income (loss) per share, Marchex uses the accounting guidance that would be applicable for computing the number of diluted shares for GAAP net income (loss) per share. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20190502005780/en/
Source:
Trevor Caldwell
Marchex Investor Relations
Telephone:
206.331.3600
Email: ir@marchex.com
Or
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Marchex Corporate Communications
Telephone:
206.331.3434
Email: marchex@edelman.com