Marchex Announces First Quarter 2023 Results
Q1 2023 Financial Highlights
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GAAP revenue was
$12.2 million for the first quarter of 2023 compared to$13.2 million for the first quarter of 2022. -
Net loss was
$4.5 million for the first quarter of 2023 or$0.11 per diluted share compared to a net loss of$1.6 million or$0.04 per diluted share for the first quarter of 2022.
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Q1 2022 |
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Q1 2023 |
GAAP Revenue |
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Non-GAAP Results: |
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Adjusted EBITDA* |
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* |
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Adjusted EBITDA includes approximately |
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Adjusted non-GAAP income (loss) per share for the first quarter of 2023 was (
$0.08 ) compared to ($0.01 ) for the first quarter of 2022.
First Quarter Summary:
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New Customer Traction and Existing Customer Expansion. During the first quarter of 2023,
Marchex signed a long-term, multi-year extension with an existing auto brand customer and won an additional long-term, multi-year agreement with a new auto brand. Under the parameters of both agreements, there is significant growth potential over time. The company also signed a multi-year extension with a small business listing and solutions provider that primarily sells marketing services to local businesses. - Conversation Volumes. Overall conversation volumes in the first quarter of 2023 were down on a year-over-year basis, due in part to some customers being impacted by inflationary pressures, customer churn and pressure from other overall macroeconomic factors.
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Accelerate Product Innovation.
Marchex recently launched Spotlight for Automotive, a key addition to the company’s conversation intelligence platform. Spotlight identifies failed calls and enables users to easily measure call handling, campaign, and seller performance results against company benchmarks, to determine how individual locations and teams perform nationally, regionally, and locally. Spotlight can measure across a brand or network of business locations, all the way down to localized dealer and department levels, providing guided observations directing users where to take needed actions to improve performance and increase sales.
“In the first quarter,
Business Outlook
The following forward-looking statements reflect
“Consistent with the fourth quarter of 2022, certain customer segments continued to face conversation volume pressure in the first quarter of 2023 and that continues today,” said
In 2023, looking at the recent customer wins and expected ramping of existing customer relationships, we anticipate that revenue should increase throughout 2023. We also believe, as revenue ramps, that we should make meaningful progress on profitability measures in the remainder of the year, potentially reaching break-even on an Adjusted EBITDA basis in the second half of the year. In addition, as we see sales traction and make further progress on technology infrastructure initiatives, we continue to believe that we can see growth accelerate and potentially increase significantly our operating leverage over time,” said Arends.
Management will hold a conference call, starting at
About
Marchex’s award-winning conversation intelligence platform, featuring AI-powered sales engagement and marketing solutions, helps businesses turn strategic insights into the actions that drive their most valued sales outcomes. Our multichannel voice and text capabilities enable sales and marketing teams to deliver the buying experiences that today’s customers expect.
Please visit http://www.marchex.com, www.marchex.com/blog or @marchex on Twitter (Twitter.com/Marchex), where
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 EBITDA represents net income (loss) before (1) interest, (2) income taxes, (3) amortization of intangible assets from acquisitions, (4) depreciation and amortization, (5) stock-based compensation expense, and (6) acquisition and disposition-related costs (benefit).
Adjusted OIBA represents Adjusted EBITDA adjusted for depreciation and amortization. This measure, among other things, is another metric by which
Adjusted non-GAAP income (loss) per share represents Adjusted non-GAAP income (loss) divided by GAAP diluted shares outstanding. Adjusted non-GAAP income (loss) generally captures those items on the statement of operations that have been, or ultimately will be, settled in cash exclusive of certain items that are not indicative of Marchex’s recurring core operating results and represents net income (loss) applicable to common stockholders plus the net of tax effects of: (1) stock-based compensation expense, (2) acquisition and disposition related costs (benefit), (3) amortization of intangible assets from acquisitions, and (4) interest income and other, net. Financial analysts and investors may use Adjusted non-GAAP income (loss) per share to analyze
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Three Months Ended |
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2022 |
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2023 |
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Revenue |
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$ |
13,171 |
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$ |
12,216 |
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Expenses: |
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Service costs (1) |
|
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4,935 |
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5,424 |
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Sales and marketing (1) |
|
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3,165 |
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|
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3,970 |
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Product development (1) |
|
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3,460 |
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|
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4,164 |
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General and administrative (1) |
|
|
2,606 |
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|
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2,617 |
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Amortization of intangible assets from acquisitions |
|
|
531 |
|
|
|
531 |
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Acquisition and disposition-related costs |
|
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5 |
|
|
|
13 |
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Total operating expenses |
|
|
14,702 |
|
|
|
16,719 |
|
Loss from operations |
|
|
(1,531 |
) |
|
|
(4,503 |
) |
Interest income (expense) and other, net |
|
|
(21 |
) |
|
|
57 |
|
Loss before provision for income taxes |
|
|
(1,552 |
) |
|
|
(4,446 |
) |
Income tax expense |
|
|
30 |
|
|
|
30 |
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Net loss |
|
|
(1,582 |
) |
|
|
(4,476 |
) |
Net loss applicable to common stockholders |
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$ |
(1,582 |
) |
|
$ |
(4,476 |
) |
Basic and diluted net loss per Class A and Class B share applicable to common stockholders |
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$ |
(0.04 |
) |
|
$ |
(0.11 |
) |
Shares used to calculate basic net loss per share applicable to common stockholders |
|
|
|
|
|
|
|
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Class A |
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4,661 |
|
|
|
4,661 |
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Class B |
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38,666 |
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37,835 |
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Shares used to calculate diluted net loss per share applicable to common stockholders: |
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Class A |
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4,661 |
|
|
|
4,661 |
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Class B |
|
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43,327 |
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|
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42,496 |
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(1) Includes stock-based compensation allocated as follows: |
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Service costs |
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$ |
34 |
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$ |
45 |
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Sales and marketing |
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191 |
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|
|
263 |
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Product development |
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|
82 |
|
|
|
86 |
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General and administrative |
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|
388 |
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|
|
405 |
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Total |
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$ |
695 |
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$ |
799 |
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2022 |
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2023 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
20,474 |
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$ |
15,710 |
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Accounts receivable, net |
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8,396 |
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|
8,047 |
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Prepaid expenses and other current assets |
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2,015 |
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|
2,397 |
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Total current assets |
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30,885 |
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26,154 |
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Property and equipment, net |
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4,050 |
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4,530 |
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Right-of-use lease asset |
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|
738 |
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|
495 |
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Other assets, net |
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973 |
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1,118 |
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17,558 |
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17,558 |
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Intangible assets from acquisitions, net |
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2,590 |
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|
2,059 |
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Total assets |
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$ |
56,794 |
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$ |
51,914 |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
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$ |
2,037 |
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$ |
1,342 |
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Accrued benefits and payroll |
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3,566 |
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|
2,981 |
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Other accrued expenses and current liabilities |
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3,825 |
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|
4,261 |
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Deferred revenue and deposits |
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1,384 |
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1,676 |
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Right of use liability, current |
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1,252 |
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|
189 |
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Finance lease, current |
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— |
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|
161 |
|
Total current liabilities |
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|
12,064 |
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|
10,610 |
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Deferred tax liabilities |
|
|
233 |
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|
|
232 |
|
Finance lease, non-current |
|
|
- |
|
|
|
290 |
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Right of use liability non-current |
|
|
385 |
|
|
|
336 |
|
Total liabilities |
|
|
12,682 |
|
|
|
11,468 |
|
Stockholders’ equity: |
|
|
|
|
|
|
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Class A common stock |
|
|
49 |
|
|
|
49 |
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Class B common stock |
|
|
385 |
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|
|
387 |
|
Additional paid-in capital |
|
|
354,999 |
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|
|
355,807 |
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Accumulated deficit |
|
|
(311,321 |
) |
|
|
(315,797 |
) |
Total stockholders’ equity |
|
|
44,112 |
|
|
|
40,446 |
|
Total liabilities and stockholders’ equity |
|
$ |
56,794 |
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|
$ |
51,914 |
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Three Months Ended |
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|||||
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|
2022 |
|
|
2023 |
|
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Net loss applicable to common stockholders |
|
$ |
(1,582 |
) |
|
$ |
(4,476 |
) |
Interest income (expense) and other, net |
|
|
21 |
|
|
|
(57 |
) |
Income tax expense |
|
|
30 |
|
|
|
30 |
|
Amortization of intangible assets from acquisitions |
|
|
531 |
|
|
|
531 |
|
Depreciation and amortization |
|
|
451 |
|
|
|
359 |
|
Stock-based compensation |
|
|
695 |
|
|
|
799 |
|
Acquisition and disposition-related costs |
|
|
5 |
|
|
|
13 |
|
Adjusted EBITDA |
|
$ |
151 |
|
|
$ |
(2,801 |
) |
Depreciation and amortization |
|
|
451 |
|
|
|
359 |
|
Adjusted OIBA |
|
$ |
(300 |
) |
|
$ |
(3,160 |
) |
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Three Months Ended |
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|
2022 |
|
|
2023 |
|
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Net loss applicable to common stockholders, diluted |
|
$ |
(0.04 |
) |
|
$ |
(0.11 |
) |
Stock-based compensation |
|
|
0.02 |
|
|
|
0.02 |
|
Acquisition and disposition-related costs |
|
|
- |
|
|
|
- |
|
Amortization of intangible assets from acquisitions |
|
|
0.01 |
|
|
|
0.01 |
|
Interest income and other, net |
|
|
- |
|
|
|
- |
|
Adjusted non-GAAP loss per share |
|
$ |
(0.01 |
) |
|
$ |
(0.08 |
) |
Shares used to calculate diluted net loss per share applicable to common stockholders (GAAP) and Adjusted Non-GAAP loss per share |
|
|
43,327 |
|
|
|
42,496 |
|
1 |
|
For the purpose of computing the number of diluted shares for Adjusted non-GAAP income (loss) per share, |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230504005818/en/
Marchex Investor Relations
Telephone: 206.331.3600
Email: ir@marchex.com
Or
MEDIA INQUIRIES
Telephone: 206.331.3434
Email: pr(at)marchex.com
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