Marchex Announces Fourth Quarter and Full Year 2017 Results
Q4 and Full Year 2017 Financial Highlights
-
Revenue was $21.8 million for the fourth quarter of 2017, compared to
$28.4 million for the fourth quarter of 2016. Revenue was $90.3 million for 2017, compared to$129.5 million for 2016. -
Net loss applicable to common stockholders was
$841,000 for the fourth quarter of 2017 or$0.02 per diluted share, compared to a net loss of$5.7 million or$0.14 per diluted share for the fourth quarter of 2016. Net loss applicable to common stockholders was$6.4 million for 2017 or$0.15 per diluted share, compared to a net loss of$84.1 million or$2.01 per diluted share for 2016.
Q4 2016 | Q4 2017 | FY 2016 | FY 2017 | ||||||||||||||||||
Revenue | $ | 28.4 | million | $ | 21.8 | million | $ | 129.5 | million | $ | 90.3 | million | |||||||||
Non-GAAP Results1: | |||||||||||||||||||||
Enterprise Revenue2 | $ | 22.4 | million | $ | 17.7 | million | $ | 100.1 | million | $ | 71.3 | million | |||||||||
Adjusted OIBA | $ | (2.8 | ) | million | $ | 0.4 | million | $ | (9.7 | ) | million | $ | (1.8 | ) | million | ||||||
Adjusted EBITDA | $ | (2.0 | ) | million | $ | 1.0 | million | $ | (6.6 | ) | million | $ | 1.0 | million | |||||||
Cash Balance | $ | 104 | million | $ | 104 | million |
-
Adjusted non-GAAP income (loss) per share1 for the fourth
quarter of 2017 was
$0.01 , compared to($0.04) for the fourth quarter of 2016. Adjusted non-GAAP income (loss) per share1 for 2017 was($0.03) , compared to($0.16) for 2016. -
During the fourth quarter of 2017, YP contributed
$4.2 million in revenue, compared to$6.0 million in the fourth quarter of 2016. During 2017, YP contributed$19.0 million in revenue compared to$29.4 million in 2016.
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. |
|
2 |
Enterprise Revenue represents total revenue less revenue generated from contracts with YP. |
Strategic Priorities Update
Grow New and Existing Enterprise Client Relationships. During
2017,
Accelerate Product Innovation.
-
Marchex Speech Analytics was launched in April 2017 to
enable actionable insights for enterprise and mid-sized companies,
helping them understand what is happening on inbound phone calls from
consumers to their business. In
October 2017 , new enhancements were added to this solution, which included updates to its Call DNA user interface. The interface accepts user input on Artificial Intelligence predicted outcomes, which will allowMarchex to improve the overall accuracy of its speech recognition. Uncovering the intelligence and insights of calls can empower companies to optimize media spend and sales operations, and can enable them to drive more high-quality calls to their business and create the opportunity to convert more of those callers into customers. -
Marchex Audience Targeting was launched in July 2017 to
automatically build high-value audience segments for display and
social media platforms by leveraging real customer interactions.
Marketers can fine-tune their
Facebook and display campaigns down to specific audience segments that are most likely to convert to customers, or find new segments and opportunities that have not been targeted before. -
Marchex Omnichannel Analytics Cloud was launched in
February 2017 to help marketers connect customer conversions driven from all paid media channels – including search, display and video, social and sites – to phone calls made to a business. -
Marchex Search Essentials was launched in
June 2017 and is a new version of our leading Search Analytics available to companies of all sizes. Marchex Search Essentials helps eliminate a major blind spot for marketers by attributing inbound phone calls to paid search keywords and as a result, marketers have the insights to help to make real-time adjustments to drive stronger, more efficient performance for their paid search campaigns. -
Video and Display Analytics was launched
in
December 2016 to measure the impact of display and video advertising campaigns on inbound phone calls to call centers and stores. Marketers can expand their visibility into these campaigns by measuring video advertising units in both premium and programmatic video publishers.
Strategic Partnerships and Integrations. During 2017,
“In 2017, we made considerable progress in building a leading
conversation analytics platform through continued product innovation and
through strategic partnerships,” said
Business Outlook
The following forward-looking statements reflect
Financial Guidance for the First Quarter ending
Revenue | $21 million or more | |
Adjusted OIBA1 | loss of $1.0 million or better | |
Adjusted EBITDA1 | breakeven or better |
Conference Call and Webcast Information
Management will hold a conference call, starting at
About
Please visit http://www.marchex.com, www.marchex.com/blog or @marchex on
Twitter (Twitter.com/
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
MARCHEX, INC. AND SUBSIDIARIES | ||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2016 | 2017 | 2016 | 2017 | |||||||||||||
Revenue | $ | 28,401 | $ | 21,847 | $ | 129,547 | $ | 90,291 | ||||||||
Expenses: | ||||||||||||||||
Service costs (1) |
16,006 | 11,649 | 76,970 | 49,339 | ||||||||||||
Sales and marketing (1) |
5,574 | 3,577 | 22,307 | 15,652 | ||||||||||||
Product development (1) | 6,587 | 4,285 | 28,446 | 18,094 | ||||||||||||
General and administrative (1) | 5,939 | 2,999 | 21,754 | 13,567 | ||||||||||||
Acquisition and disposition related costs | — | — | 662 | — | ||||||||||||
Total operating expenses | 34,106 | 22,510 | 150,139 | 96,652 | ||||||||||||
Impairment of goodwill | — | — | (63,305 | ) | — | |||||||||||
Loss from operations | (5,705 | ) | (663 | ) | (83,897 | ) | (6,361 | ) | ||||||||
Interest income (expense) and other, net | (25 | ) | 182 | (115 | ) | 316 | ||||||||||
Loss before provision for income taxes | (5,730 | ) | (481 | ) | (84,012 | ) | (6,045 | ) | ||||||||
Income tax expense | 14 | 5 | 54 | 42 | ||||||||||||
Net loss | (5,744 | ) | (486 | ) | (84,066 | ) | (6,087 | ) | ||||||||
Dividends applicable to participating securities | — | (355 | ) | — | (355 | ) | ||||||||||
Net loss applicable to common stockholders | $ | (5,744 | ) | $ | (841 | ) | $ | (84,066 | ) | $ | (6,442 | ) | ||||
Basic and diluted net loss per Class A share applicable to common stockholders | $ | (0.14 | ) | $ | (0.02 | ) | $ | (2.01 | ) | $ | (0.16 | ) | ||||
Basic and diluted net loss per Class B share applicable to common stockholders | $ | (0.14 | ) | $ | (0.02 | ) | $ | (2.01 | ) | $ | (0.15 | ) | ||||
Dividends applicable to participating securities | $ | — | $ | 0.50 | $ | — | $ | 0.50 | ||||||||
Shares used to calculate basic net loss per share applicable to common stockholders: | ||||||||||||||||
Class A | 5,062 | 5,056 | 5,190 | 5,056 | ||||||||||||
Class B | 37,076 | 37,930 | 36,550 | 37,657 | ||||||||||||
Shares used to calculate diluted net loss per share applicable to common stockholders: | ||||||||||||||||
Class A | 5,062 | 5,056 | 5,190 | 5,056 | ||||||||||||
Class B | 42,138 | 42,987 | 41,740 | 42,713 | ||||||||||||
(1) Includes stock-based compensation allocated as follows: | ||||||||||||||||
Service costs | $ | 128 | $ | 130 | $ | 693 | $ | 515 | ||||||||
Sales and marketing | 417 | 246 | 1,738 | 1,014 | ||||||||||||
Product development | 202 | 182 | 1,569 | 679 | ||||||||||||
General and administrative | 2,190 | 539 | 6,183 | 2,389 | ||||||||||||
Total | $ | 2,937 | $ | 1,097 | $ | 10,183 | $ | 4,597 | ||||||||
MARCHEX, INC. AND SUBSIDIARIES | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
(in thousands) | ||||||||
(unaudited) | ||||||||
December 31, | December 31, | |||||||
2016 | 2017 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 103,950 | $ | 104,190 | ||||
Accounts receivable, net | 18,922 | 14,860 | ||||||
Prepaid expenses and other current assets | 1,531 | 2,001 | ||||||
Refundable taxes | 98 | 40 | ||||||
Total current assets | 124,501 | 121,091 | ||||||
Property and equipment, net | 3,557 | 2,405 | ||||||
Other assets, net | 214 | 326 | ||||||
Total assets | $ | 128,272 | $ | 123,822 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 6,811 | $ | 4,928 | ||||
Accrued expenses and other current liabilities | 7,707 | 5,585 | ||||||
Deferred revenue | 349 | 313 | ||||||
Dividends payable | — | 21,907 | ||||||
Total current liabilities | 14,867 | 32,733 | ||||||
Other non-current liabilities | 134 | 1,090 | ||||||
Total liabilities | 15,001 | 33,823 | ||||||
Stockholders’ equity: | ||||||||
Class A common stock | 53 | 53 | ||||||
Class B common stock | 380 | 387 | ||||||
Additional paid-in capital | 360,422 | 343,268 | ||||||
Accumulated deficit | (247,584 | ) | (253,709 | ) | ||||
Total stockholders’ equity | 113,271 | 89,999 | ||||||
Total liabilities and stockholders’ equity | $ | 128,272 | $ | 123,822 | ||||
MARCHEX, INC. AND SUBSIDIARIES | ||||||||||||||||
(in thousands) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Reconciliation of GAAP Loss from Operations to Operating Income (Loss) Before Amortization (OIBA) | ||||||||||||||||
and Adjusted Operating Income (Loss) Before Amortization (Adjusted OIBA) | ||||||||||||||||
|
Three Months Ended |
Twelve Months Ended |
||||||||||||||
2016 | 2017 | 2016 | 2017 | |||||||||||||
Loss from operations | $ | (5,705 | ) | $ | (663 | ) | $ | (83,897 | ) | $ | (6,361 | ) | ||||
Stock-based compensation | 2,937 | 1,097 | 10,183 | 4,597 | ||||||||||||
Operating income (loss) before amortization (OIBA) | (2,768 | ) | 434 | (73,714 | ) | (1,764 | ) | |||||||||
Acquisition and disposition related costs | — | — | 662 | — | ||||||||||||
Impairment of goodwill | — | — | 63,305 | — | ||||||||||||
Adjusted operating income (loss) before amortization (Adjusted OIBA)1 | $ | (2,768 | ) | $ | 434 | $ | (9,747 | ) | $ | (1,764 | ) | |||||
Reconciliation from Net Cash provided by (used in) Operating Activities to Adjusted EBITDA |
||||||||||||||||
Three Months Ended |
Twelve Months Ended |
|||||||||||||||
2016 | 2017 | 2016 | 2017 | |||||||||||||
Net cash provided by (used in) operating activities | $ | (796 | ) | $ | 0 | $ | (3,669 | ) | $ | 1,692 | ||||||
Changes in assets and liabilities | (1,273 | ) | 1,136 | (3,711 | ) | (392 | ) | |||||||||
Income tax expense | 14 | 5 | 54 | 42 | ||||||||||||
Acquisition and disposition related costs | — | — | 662 | — | ||||||||||||
Interest (income) expense and other, net | 25 | (182 | ) | 112 | (316 | ) | ||||||||||
Adjusted EBITDA1 | $ | (2,030 | ) | $ | 959 | $ | (6,552 | ) | $ | 1,026 | ||||||
Net cash provided by (used in) investing activities | $ | 395 | $ | (288 | ) | $ | (1,224 | ) | $ | (1,577 | ) | |||||
Net cash provided by (used in) financing activities | $ | (134 | ) | $ | 101 | $ | (312 | ) | $ | 125 | ||||||
1 | Includes reorganization costs of approximately $700,000 in Q1 2017. | |
Reconciliation from Revenue to Enterprise Revenue |
|||||||||||||||
Three Months Ended |
Twelve Months Ended |
||||||||||||||
2016 | 2017 | 2016 | 2017 | ||||||||||||
Revenue | $ | 28,401 | $ | 21,847 | $ | 129,547 | $ | 90,291 | |||||||
Less: YP Revenue | 6,031 | 4,197 | 29,388 | 19,013 | |||||||||||
Less: Other | — | — | 21 | — | |||||||||||
Enterprise Revenue2 | $ | 22,370 | $ | 17,650 | $ | 100,138 | $ | 71,278 | |||||||
2 | Enterprise Revenue represents total revenue less revenue generated from contracts with YP and other Archeo related transition activities. | |
MARCHEX, INC. AND SUBSIDIARIES | ||||||||||||||||
Reconciliation of GAAP Net Loss per Share to Adjusted Non-GAAP Income (Loss) per Share | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended |
Twelve Months Ended |
|||||||||||||||
2016 | 2017 | 2016 | 2017 | |||||||||||||
Adjusted Non-GAAP income (loss) per share | $ | (0.04 | ) | $ | 0.01 | $ | (0.16 | ) | $ | (0.03 | ) | |||||
Net loss per Class B share applicable to common stockholders - diluted (GAAP loss per share) |
$ | (0.14 | ) | $ | (0.02 | ) | $ | (2.01 | ) | $ | (0.15 | ) | ||||
Shares used to calculate diluted net loss per share applicable to common stockholders |
42,138 | 42,987 | 41,740 | 42,713 | ||||||||||||
Net loss applicable to common stockholders | $ | (5,744 | ) | $ | (841 | ) | $ | (84,066 | ) | $ | (6,442 | ) | ||||
Stock-based compensation | 2,937 | 1,097 | 10,183 | 4,597 | ||||||||||||
Acquisition and disposition related costs | — | — | 662 | — | ||||||||||||
Impairment of goodwill | — | — | 63,305 | — | ||||||||||||
Interest (income) expense and other, net | 25 | (182 | ) | 115 | (316 | ) | ||||||||||
Dividends applicable to participating securities | — | 355 | — | 355 | ||||||||||||
Estimated impact of income taxes | 931 | (151 | ) | 3,273 | 575 | |||||||||||
Adjusted Non-GAAP net income (loss) | $ | (1,851 | ) | $ | 278 | $ | (6,528 | ) | $ | (1,231 | ) | |||||
Adjusted Non-GAAP income (loss) per share | $ | (0.04 | ) | $ | 0.01 | $ | (0.16 | ) | $ | (0.03 | ) | |||||
Shares used to calculate diluted net loss per Class B share applicable to common stockholders (GAAP) | 42,138 | 42,987 | 41,740 | 42,713 | ||||||||||||
Weighted average stock options and common shares subject to purchase or cancellation (if applicable) | — | 339 | — | — | ||||||||||||
Diluted shares used to calculate Adjusted Non-GAAP income (loss) per share 1 | 42,138 | 43,326 | 41,740 | 42,713 | ||||||||||||
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: http://www.businesswire.com/news/home/20180215006223/en/
Source:
Marchex Investor Relations
Trevor Caldwell, 206-331-3600
ir(at)marchex.com
or
MEDIA
INQUIRIES
Marchex Corporate Communications
206-331-3434
marchex(at)edelman.com