| |||||
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
2023
| |||||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
from_______to_______
|
| |||||||
Delaware | 85-3447553 | |||||||
(State or other jurisdiction of
| (I.R.S. Employer
| |||||||
2722 Michelson Drive, Suite 100 Irvine, CA 92612 | ||||||||
(Address of principal executive offices and zip code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Class A common stock, par value $0.001 per share | DSP | The Nasdaq Stock Market LLC (Nasdaq Global Select Market) |
Large accelerated filer | o |
| Accelerated filer |
| ||||||||||
Non-accelerated filer | x |
| Smaller reporting company |
| ||||||||||
Emerging growth company | x |
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| Page | ||||||||
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A. |
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B. |
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C. | Condensed Consolidated Statements of |
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D. |
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E. |
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| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Revenue |
| $ | 48,830 |
|
| $ | 50,857 |
|
| $ | 142,659 |
|
| $ | 141,412 |
| Revenue | $ | 57,223 | $ | 51,200 | $ | 98,943 | $ | 93,829 | ||||||||||||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating expenses: | ||||||||||||||||||||||
Platform operations |
|
| 27,530 |
|
|
| 28,967 |
|
|
| 84,674 |
|
|
| 85,026 |
| Platform operations | 33,523 | 30,950 | 56,860 | 57,144 | ||||||||||||||||||
Sales and marketing |
|
| 16,949 |
|
|
| 15,131 |
|
|
| 47,991 |
|
|
| 49,869 |
| Sales and marketing | 11,691 | 17,286 | 23,860 | 31,042 | ||||||||||||||||||
Technology and development |
|
| 5,576 |
|
|
| 6,590 |
|
|
| 15,590 |
|
|
| 20,521 |
| Technology and development | 6,172 | 5,011 | 12,066 | 10,014 | ||||||||||||||||||
General and administrative |
|
| 11,650 |
|
|
| 11,981 |
|
|
| 34,458 |
|
|
| 36,477 |
| General and administrative | 11,088 | 11,725 | 22,516 | 22,808 | ||||||||||||||||||
Total operating expenses |
|
| 61,705 |
|
|
| 62,669 |
|
|
| 182,713 |
|
|
| 191,893 |
| Total operating expenses | 62,474 | 64,972 | 115,302 | 121,008 | ||||||||||||||||||
Loss from operations |
|
| (12,875 | ) |
|
| (11,812 | ) |
|
| (40,054 | ) |
|
| (50,481 | ) | Loss from operations | (5,251) | (13,772) | (16,359) | (27,179) | ||||||||||||||||||
Interest expense (income), net |
|
| (455 | ) |
|
| 227 |
|
|
| (282 | ) |
|
| 703 |
| Interest expense (income), net | (2,049) | 21 | (3,868) | 173 | ||||||||||||||||||
Other expense, net |
|
| 6 |
|
|
| 121 |
|
|
| 309 |
|
|
| 53 |
| Other expense, net | 1 | 299 | 88 | 303 | ||||||||||||||||||
Gain on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (6,110 | ) | |||||||||||||||||||||||
Total other expense (income), net |
|
| (449 | ) |
|
| 348 |
|
|
| 27 |
|
|
| (5,354 | ) | Total other expense (income), net | (2,048) | 320 | (3,780) | 476 | ||||||||||||||||||
Net loss |
|
| (12,426 | ) |
|
| (12,160 | ) |
|
| (40,081 | ) |
|
| (45,127 | ) | Net loss | (3,203) | (14,092) | (12,579) | (27,655) | ||||||||||||||||||
Less: Net loss attributable to noncontrolling interests |
|
| (9,300 | ) |
|
| (9,623 | ) |
|
| (30,362 | ) |
|
| (35,829 | ) | Less: Net loss attributable to noncontrolling interests | (2,140) | (10,691) | (9,036) | (21,062) | ||||||||||||||||||
Net loss attributable to Viant Technology Inc. |
| $ | (3,126 | ) |
| $ | (2,537 | ) |
| $ | (9,719 | ) |
| $ | (9,298 | ) | Net loss attributable to Viant Technology Inc. | $ | (1,063) | $ | (3,401) | $ | (3,543) | $ | (6,593) | ||||||||||||||
Loss per share of Class A common stock: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loss per share of Class A common stock: | ||||||||||||||||||||||
Basic |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
| $ | (0.69 | ) |
| $ | (0.78 | ) | Basic | $ | (0.07) | $ | (0.24) | $ | (0.24) | $ | (0.47) | ||||||||||||||
Diluted |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
| $ | (0.69 | ) |
| $ | (0.78 | ) | Diluted | $ | (0.07) | $ | (0.24) | $ | (0.24) | $ | (0.47) | ||||||||||||||
Weighted-average shares of Class A common stock outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted-average shares of Class A common stock outstanding: | ||||||||||||||||||||||
Basic |
|
| 14,306 |
|
|
| 12,489 |
|
|
| 14,078 |
|
|
| 11,894 |
| Basic | 15,135 | 14,114 | 14,943 | 13,962 | ||||||||||||||||||
Diluted |
|
| 14,306 |
|
|
| 12,489 |
|
|
| 14,078 |
|
|
| 11,894 |
| Diluted | 15,135 | 14,114 | 14,943 | 13,962 |
|
| As of September 30, |
|
| As of December 31, |
| As of June 30, | As of December 31, | |||||||||||
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | |||||||||||
Assets |
|
|
|
|
|
|
|
| Assets | ||||||||||
Current assets: |
|
|
|
|
|
|
|
| Current assets: | ||||||||||
Cash and cash equivalents |
| $ | 199,665 |
|
| $ | 238,480 |
| Cash and cash equivalents | $ | 203,901 | $ | 206,573 | ||||||
Accounts receivable, net of allowances |
|
| 93,609 |
|
|
| 110,739 |
| Accounts receivable, net of allowances | 89,967 | 101,658 | ||||||||
Prepaid expenses and other current assets |
|
| 6,010 |
|
|
| 2,967 |
| Prepaid expenses and other current assets | 4,190 | 6,631 | ||||||||
Total current assets |
|
| 299,284 |
|
|
| 352,186 |
| Total current assets | 298,058 | 314,862 | ||||||||
Property, equipment, and software, net |
|
| 22,681 |
|
|
| 22,331 |
| Property, equipment, and software, net | 25,829 | 23,106 | ||||||||
Operating lease assets |
|
| 22,816 |
|
|
| — |
| Operating lease assets | 24,715 | 26,441 | ||||||||
Intangible assets, net |
|
| 945 |
|
|
| 1,786 |
| Intangible assets, net | 405 | 667 | ||||||||
Goodwill |
|
| 12,422 |
|
|
| 12,422 |
| Goodwill | 12,422 | 12,422 | ||||||||
Other assets |
|
| 348 |
|
|
| 406 |
| Other assets | 26 | 385 | ||||||||
Total assets |
| $ | 358,496 |
|
| $ | 389,131 |
| Total assets | $ | 361,455 | $ | 377,883 | ||||||
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
| Liabilities and stockholders’ equity | ||||||||||
Liabilities |
|
|
|
|
|
|
|
| Liabilities | ||||||||||
Current liabilities: |
|
|
|
|
|
|
|
| Current liabilities: | ||||||||||
Accounts payable |
| $ | 29,897 |
|
| $ | 32,877 |
| Accounts payable | $ | 31,765 | $ | 37,063 | ||||||
Accrued liabilities |
|
| 28,202 |
|
|
| 34,086 |
| Accrued liabilities | 29,831 | 35,063 | ||||||||
Accrued compensation |
|
| 8,235 |
|
|
| 12,247 |
| Accrued compensation | 5,878 | 9,162 | ||||||||
Current portion of deferred revenue |
|
| 65 |
|
|
| 1,317 |
| Current portion of deferred revenue | 180 | 123 | ||||||||
Current portion of operating lease liabilities |
|
| 2,813 |
|
|
| — |
| Current portion of operating lease liabilities | 3,918 | 3,711 | ||||||||
Other current liabilities |
|
| 1,423 |
|
|
| 2,531 |
| Other current liabilities | 2,494 | 1,995 | ||||||||
Total current liabilities |
|
| 70,635 |
|
|
| 83,058 |
| Total current liabilities | 74,066 | 87,117 | ||||||||
Long-term debt |
|
| — |
|
|
| 17,500 |
| Long-term debt | — | — | ||||||||
Long-term portion of deferred revenue |
|
| — |
|
|
| 5,234 |
| |||||||||||
Long-term portion of operating lease liabilities |
|
| 21,967 |
|
|
| — |
| Long-term portion of operating lease liabilities | 23,334 | 24,998 | ||||||||
Other long-term liabilities |
|
| — |
|
|
| 765 |
| |||||||||||
Total liabilities |
|
| 92,602 |
|
|
| 106,557 |
| Total liabilities | 97,400 | 112,115 | ||||||||
Commitments and contingencies (Note 13) |
|
|
|
|
|
|
|
| Commitments and contingencies (Note 13) | ||||||||||
Stockholders’ equity |
|
|
|
|
|
|
|
| Stockholders’ equity | ||||||||||
Preferred stock, $0.001 par value |
|
|
|
|
|
|
|
| Preferred stock, $0.001 par value | ||||||||||
Authorized shares — 10,000,000 |
|
|
|
|
|
|
|
| Authorized shares — 10,000,000 | ||||||||||
Issued and outstanding — none |
|
| — |
|
|
| — |
| Issued and outstanding — none | — | — | ||||||||
Class A common stock, $0.001 par value |
|
|
|
|
|
|
|
| Class A common stock, $0.001 par value | ||||||||||
Authorized shares — 450,000,000 |
|
|
|
|
|
|
|
| Authorized shares — 450,000,000 | ||||||||||
Issued — 14,604,257 and 13,920,868 |
|
|
|
|
|
|
|
| |||||||||||
Outstanding — 14,460,084 and 13,704,638 |
|
| 14 |
|
|
| 14 |
| |||||||||||
Issued — 15,598,505 and 14,783,886 | Issued — 15,598,505 and 14,783,886 | ||||||||||||||||||
Outstanding — 15,342,563 and 14,643,798 | Outstanding — 15,342,563 and 14,643,798 | 16 | 15 | ||||||||||||||||
Class B common stock, $0.001 par value |
|
|
|
|
|
|
|
| Class B common stock, $0.001 par value | ||||||||||
Authorized shares — 150,000,000 |
|
|
|
|
|
|
|
| Authorized shares — 150,000,000 | ||||||||||
Issued and outstanding — 47,082,260 and 47,107,130 |
|
| 47 |
|
|
| 47 |
| |||||||||||
Issued and outstanding — 47,082,260 and 47,082,260 | Issued and outstanding — 47,082,260 and 47,082,260 | 47 | 47 | ||||||||||||||||
Additional paid-in capital |
|
| 92,736 |
|
|
| 82,888 |
| Additional paid-in capital | 102,885 | 95,922 | ||||||||
Accumulated deficit |
|
| (33,367 | ) |
|
| (20,139 | ) | Accumulated deficit | (41,636) | (36,261) | ||||||||
Treasury stock, at cost; 144,173 and 216,230 shares held |
|
| (701 | ) |
|
| (2,648 | ) | |||||||||||
Treasury stock, at cost; 255,942 and 140,088 shares held | Treasury stock, at cost; 255,942 and 140,088 shares held | (1,074) | (475) | ||||||||||||||||
Total stockholders’ equity attributable to Viant Technology Inc. |
|
| 58,729 |
|
|
| 60,162 |
| Total stockholders’ equity attributable to Viant Technology Inc. | 60,238 | 59,248 | ||||||||
Noncontrolling interests |
|
| 207,165 |
|
|
| 222,412 |
| Noncontrolling interests | 203,817 | 206,520 | ||||||||
Total equity |
|
| 265,894 |
|
|
| 282,574 |
| Total equity | 264,055 | 265,768 | ||||||||
Total liabilities and stockholders’ equity |
| $ | 358,496 |
|
| $ | 389,131 |
| Total liabilities and stockholders’ equity | $ | 361,455 | $ | 377,883 |
|
| Class A Common Stock |
|
| Class B Common Stock |
|
| Additional Paid-In |
|
| Accumulated |
|
| Treasury Stock |
|
| Noncontrolling |
|
| Total |
| |||||||||||||||||||
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Shares |
|
| Amount |
|
| Interests |
|
| Equity |
| ||||||||||
Balance as of December 31, 2021 |
|
| 13,921 |
|
| $ | 14 |
|
|
| 47,107 |
|
| $ | 47 |
|
| $ | 82,888 |
|
| $ | (20,139 | ) |
|
| (216 | ) |
| $ | (2,648 | ) |
| $ | 222,412 |
|
| $ | 282,574 |
|
Exchange of Class B common stock for Class A common stock |
|
| 25 |
|
|
| — |
|
|
| (25 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Issuance of Class A common stock in connection with equity-based compensation plans |
|
| 126 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Reissuance of treasury stock in connection with equity-based compensation plans |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,648 | ) |
|
| 216 |
|
|
| 2,648 |
|
|
| — |
|
|
| — |
|
Allocation of equity to noncontrolling interests |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (4,276 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 4,276 |
|
|
| — |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (12 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (12 | ) |
Stock-based compensation |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7,326 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7,326 |
|
Net loss |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (3,192 | ) |
|
| — |
|
|
| — |
|
|
| (10,371 | ) |
|
| (13,563 | ) |
Balance as of March 31, 2022 |
|
| 14,072 |
|
| $ | 14 |
|
|
| 47,082 |
|
| $ | 47 |
|
| $ | 85,926 |
|
| $ | (25,979 | ) |
|
| — |
|
| $ | — |
|
| $ | 216,317 |
|
| $ | 276,325 |
|
Issuance of Class A common stock in connection with equity-based compensation plans |
|
| 322 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (140 | ) |
|
| (861 | ) |
|
| — |
|
|
| (861 | ) |
Allocation of equity to noncontrolling interests |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5,455 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 5,455 |
|
|
| — |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (16 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (16 | ) |
Stock-based compensation |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 8,821 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 8,821 |
|
Net loss |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (3,401 | ) |
|
| — |
|
|
| — |
|
|
| (10,691 | ) |
|
| (14,092 | ) |
Balance as of June 30, 2022 |
|
| 14,394 |
|
| $ | 14 |
|
|
| 47,082 |
|
| $ | 47 |
|
| $ | 89,276 |
|
| $ | (29,380 | ) |
|
| (140 | ) |
| $ | (861 | ) |
| $ | 211,081 |
|
| $ | 270,177 |
|
Issuance of Class A common stock in connection with equity-based compensation plans |
|
| 210 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (144 | ) |
|
| (701 | ) |
|
| — |
|
|
| (701 | ) |
Reissuance of treasury stock in connection with equity-based compensation plans |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (861 | ) |
|
| 140 |
|
|
| 861 |
|
|
| — |
|
|
| — |
|
Allocation of equity to noncontrolling interests |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (5,384 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 5,384 |
|
|
| — |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 18 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 18 |
|
Stock-based compensation |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 8,826 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 8,826 |
|
Net loss |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (3,126 | ) |
|
| — |
|
|
| — |
|
|
| (9,300 | ) |
|
| (12,426 | ) |
Balance as of September 30, 2022 |
|
| 14,604 |
|
| $ | 14 |
|
|
| 47,082 |
|
| $ | 47 |
|
| $ | 92,736 |
|
| $ | (33,367 | ) |
|
| (144 | ) |
| $ | (701 | ) |
| $ | 207,165 |
|
| $ | 265,894 |
|
Class A Common Stock | Class B Common Stock | Additional Paid-In Capital | Accumulated Deficit | Treasury Stock | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2022 | 14,784 | $ | 15 | 47,082 | $ | 47 | $ | 95,922 | $ | (36,261) | (140) | $ | (475) | $ | 206,520 | $ | 265,768 | ||||||||||||||||||||||||||||||||||||||||||
Cumulative impact of accounting adoption | — | — | — | — | — | (209) | — | — | — | (209) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2023 | 14,784 | 15 | 47,082 | 47 | 95,922 | (36,470) | (140) | (475) | 206,520 | 265,559 | |||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock in connection with equity-based compensation plans | 660 | 1 | — | — | (1) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards | — | — | — | — | — | — | (379) | (1,567) | — | (1,567) | |||||||||||||||||||||||||||||||||||||||||||||||||
Reissuance of treasury stock in connection with equity-based compensation plans | — | — | — | — | — | (475) | 140 | 475 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Allocation of equity to noncontrolling interests | — | — | — | — | (2,377) | — | — | — | 2,377 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Accrued member tax distributions | — | — | — | — | (1,474) | — | — | — | — | (1,474) | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 8,872 | — | — | — | — | 8,872 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (2,480) | — | — | (6,896) | (9,376) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2023 | 15,444 | $ | 15 | 47,082 | $ | 47 | $ | 100,942 | $ | (39,425) | (379) | $ | (1,567) | $ | 202,001 | $ | 262,013 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock in connection with equity-based compensation plans | 154 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards | — | — | — | — | — | — | (154) | (655) | — | (655) | |||||||||||||||||||||||||||||||||||||||||||||||||
Reissuance of treasury stock in connection with equity-based compensation plans | — | — | — | — | — | (1,148) | 277 | 1,148 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Allocation of equity to noncontrolling interests | — | — | — | — | (3,956) | — | — | — | 3,956 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Accrued member tax distributions | — | — | — | — | (4,151) | — | — | — | — | (4,151) | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 10,050 | — | — | — | — | 10,050 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (1,063) | — | — | (2,140) | (3,203) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2023 | 15,598 | $ | 16 | 47,082 | $ | 47 | $ | 102,885 | $ | (41,636) | (256) | $ | (1,074) | $ | 203,817 | $ | 264,055 |
|
| Convertible Preferred Units |
|
|
| Common Units |
|
| Class A Common Stock |
|
| Class B Common Stock |
|
| Additional Paid-In |
|
| Accumulated |
|
| Members' |
|
| Treasury Stock |
|
| Noncontrolling |
|
| Total |
| ||||||||||||||||||||||||||||||
|
| Units |
|
| Amount |
|
|
| Units |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Equity |
|
| Shares |
|
| Amount |
|
| Interests |
|
| Equity |
| |||||||||||||||
Balance as of December 31, 2020 |
|
| 600 |
|
| $ | 7,500 |
|
|
|
| 400 |
|
| $ | — |
|
|
| — |
|
| $ | — |
|
|
| — |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 20,117 |
|
|
| — |
|
| $ | — |
|
| $ | — |
|
| $ | 20,117 |
|
Net income prior to Reorganization Transactions |
|
| — |
|
|
|
|
|
|
|
| — |
|
|
|
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
|
|
|
|
| — |
|
|
| 669 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 669 |
|
Effect of Reorganization Transactions |
|
| (600 | ) |
|
| (7,500 | ) |
|
|
| (400 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 48,936 |
|
|
| 49 |
|
|
| 28,237 |
|
|
| — |
|
|
| (20,786 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 7,500 |
|
Issuance of Class A common stock in initial public offering, net of underwriting and offering costs |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| 11,500 |
|
|
| 12 |
|
|
| (1,500 | ) |
|
| (2 | ) |
|
| 228,175 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 228,185 |
|
Allocation of equity to noncontrolling interests |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (208,587 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 208,587 |
|
|
| — |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 75 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 75 |
|
Stock-based compensation |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 19,756 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 19,756 |
|
Net loss subsequent to Reorganization Transactions |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
|
|
|
|
| (3,104 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (12,435 | ) |
|
| (15,539 | ) |
Balance as of March 31, 2021 |
|
| — |
|
| $ | — |
|
|
|
| — |
|
| $ | — |
|
|
| 11,500 |
|
| $ | 12 |
|
|
| 47,436 |
|
| $ | 47 |
|
| $ | 67,656 |
|
| $ | (3,104 | ) |
| $ | — |
|
|
| — |
|
| $ | — |
|
| $ | 196,152 |
|
| $ | 260,763 |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (192 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (192 | ) |
Stock-based compensation |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 34,576 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 34,576 |
|
Net loss |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (3,655 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (14,440 | ) |
|
| (18,095 | ) |
Balance as of June 30, 2021 |
|
| — |
|
| $ | — |
|
|
|
| — |
|
| $ | — |
|
|
| 11,500 |
|
| $ | 12 |
|
|
| 47,436 |
|
| $ | 47 |
|
| $ | 102,040 |
|
| $ | (6,759 | ) |
| $ | — |
|
|
| — |
|
| $ | — |
|
| $ | 181,712 |
|
| $ | 277,052 |
|
Exchange of Class B common stock for Class A common stock |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| 299 |
|
|
| — |
|
|
| (299 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Issuance of Class A common stock in connection with equity-based compensation plans |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| 2,092 |
|
|
| 2 |
|
|
| — |
|
|
| — |
|
|
| (2 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (773 | ) |
|
| (13,703 | ) |
|
| — |
|
|
| (13,703 | ) |
Reissuance of treasury stock in connection with equity-based compensation plans |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (6,464 | ) |
|
| — |
|
|
| 365 |
|
|
| 6,464 |
|
|
| — |
|
|
| — |
|
Allocation of equity to noncontrolling interests |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (40,427 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 40,427 |
|
|
| — |
|
Accrued member tax distributions |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (337 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (337 | ) |
Stock-based compensation |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 17,976 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 17,976 |
|
Net loss |
|
| — |
|
|
| — |
|
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| (2,537 | ) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (9,623 | ) |
|
| (12,160 | ) |
Balance as of September 30, 2021 |
|
| — |
|
| $ | — |
|
|
|
| — |
|
| $ | — |
|
|
| 13,891 |
|
| $ | 14 |
|
|
| 47,137 |
|
| $ | 47 |
|
| $ | 79,250 |
|
| $ | (15,760 | ) |
| $ | — |
|
|
| (408 | ) |
| $ | (7,239 | ) |
| $ | 212,516 |
|
| $ | 268,828 |
|
Class A Common Stock | Class B Common Stock | Additional Paid-In Capital | Accumulated Deficit | Treasury Stock | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2021 | 13,921 | $ | 14 | 47,107 | $ | 47 | $ | 82,888 | $ | (20,139) | (216) | $ | (2,648) | $ | 222,412 | $ | 282,574 | ||||||||||||||||||||||||||||||||||||||||||
Exchange of Class B common stock for Class A common stock | 25 | — | (25) | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock in connection with equity-based compensation plans | 126 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Reissuance of treasury stock in connection with equity-based compensation plans | — | — | — | — | — | (2,648) | 216 | 2,648 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Allocation of equity to noncontrolling interests | — | — | — | — | (4,276) | — | — | — | 4,276 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Accrued member tax distributions | — | — | — | — | (12) | — | — | — | — | (12) | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 7,326 | — | — | — | — | 7,326 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (3,192) | — | — | (10,371) | (13,563) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | 14,072 | $ | 14 | 47,082 | $ | 47 | $ | 85,926 | $ | (25,979) | — | $ | — | $ | 216,317 | $ | 276,325 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock in connection with equity-based compensation plans | 322 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of treasury stock in connection with the taxes paid related to net share settlement of equity awards | — | — | — | — | — | — | (140) | (861) | — | (861) | |||||||||||||||||||||||||||||||||||||||||||||||||
Allocation of equity to noncontrolling interests | — | — | — | — | (5,455) | — | — | — | 5,455 | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Accrued member tax distributions | — | — | — | — | (16) | — | — | — | — | (16) | |||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 8,821 | — | — | — | — | 8,821 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (3,401) | — | — | (10,691) | (14,092) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2022 | 14,394 | $ | 14 | 47,082 | $ | 47 | $ | 89,276 | $ | (29,380) | (140) | $ | (861) | $ | 211,081 | $ | 270,177 |
|
| Nine Months Ended September 30, |
| |||||
|
| 2022 |
|
| 2021 |
| ||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
Net loss |
| $ | (40,081 | ) |
| $ | (45,127 | ) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
| 9,746 |
|
|
| 8,024 |
|
Stock-based compensation |
|
| 21,855 |
|
|
| 62,192 |
|
Provision for (recovery of) doubtful accounts |
|
| 834 |
|
|
| (161 | ) |
Loss on disposal of assets |
|
| 419 |
|
|
| 148 |
|
Gain on extinguishment of debt |
|
| — |
|
|
| (6,110 | ) |
Amortization of operating lease assets |
|
| 1,961 |
|
|
| — |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
| 16,295 |
|
|
| 20,316 |
|
Prepaid expenses and other assets |
|
| (2,982 | ) |
|
| (1,960 | ) |
Accounts payable |
|
| (2,955 | ) |
|
| (4,816 | ) |
Accrued liabilities |
|
| (5,885 | ) |
|
| (1,118 | ) |
Accrued compensation |
|
| (4,171 | ) |
|
| 198 |
|
Deferred revenue |
|
| (6,486 | ) |
|
| (1,446 | ) |
Operating lease liabilities |
|
| (964 | ) |
|
| — |
|
Other liabilities |
|
| (900 | ) |
|
| (55 | ) |
Net cash provided by (used in) operating activities |
|
| (13,314 | ) |
|
| 30,085 |
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
| (553 | ) |
|
| (386 | ) |
Capitalized software development costs |
|
| (5,872 | ) |
|
| (5,577 | ) |
Net cash used in investing activities |
|
| (6,425 | ) |
|
| (5,963 | ) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock, net of underwriting discounts |
|
| — |
|
|
| 232,500 |
|
Taxes paid related to net share settlement of equity awards |
|
| (1,561 | ) |
|
| (13,703 | ) |
Payment of member tax distributions |
|
| (15 | ) |
|
| (7,330 | ) |
Payment of offering costs |
|
| — |
|
|
| (2,608 | ) |
Repayment of revolving credit facility |
|
| (17,500 | ) |
|
| — |
|
Net cash provided by (used in) financing activities |
|
| (19,076 | ) |
|
| 208,859 |
|
Net increase (decrease) in cash and cash equivalents |
|
| (38,815 | ) |
|
| 232,981 |
|
Cash and cash equivalents at beginning of period |
|
| 238,480 |
|
|
| 9,629 |
|
Cash and cash equivalents at end of period |
| $ | 199,665 |
|
| $ | 242,610 |
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid for interest |
| $ | 199 |
|
| $ | 546 |
|
Supplemental disclosure of non-cash investing and financing activities: |
|
|
|
|
|
|
|
|
Stock-based compensation included in capitalized software development costs |
| $ | 3,113 |
|
| $ | 10,116 |
|
Operating lease assets obtained in exchange for operating lease liabilities |
| $ | 3,778 |
|
| $ | — |
|
Capitalized assets financed by accounts payable and accrued liabilities |
| $ | 516 |
|
| $ | — |
|
Accrued member tax distributions |
| $ | — |
|
| $ | 5 |
|
Non-cash gain on extinguishment of debt related to Paycheck Protection Program loan |
| $ | — |
|
| $ | 6,110 |
|
Six Months Ended June 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (12,579) | $ | (27,655) | |||||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and amortization | 6,951 | 6,380 | |||||||||
Stock-based compensation | 16,001 | 14,144 | |||||||||
Provision for doubtful accounts | 49 | 51 | |||||||||
Loss on disposal of assets | 104 | 305 | |||||||||
Noncash lease expense | 1,940 | 1,311 | |||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | 11,433 | 17,206 | |||||||||
Prepaid expenses and other assets | 2,799 | 65 | |||||||||
Accounts payable | (5,554) | (4,652) | |||||||||
Accrued liabilities | (5,187) | (2,528) | |||||||||
Accrued compensation | (3,206) | (4,607) | |||||||||
Deferred revenue | 57 | (6,486) | |||||||||
Operating lease liabilities | (1,671) | (957) | |||||||||
Other liabilities | (282) | (1,096) | |||||||||
Net cash provided by (used in) operating activities | 10,855 | (8,519) | |||||||||
Cash flows from investing activities: | |||||||||||
Purchases of property and equipment | (348) | (397) | |||||||||
Capitalized software development costs | (6,114) | (3,941) | |||||||||
Net cash used in investing activities | (6,462) | (4,338) | |||||||||
Cash flows from financing activities: | |||||||||||
Taxes paid related to net share settlement of equity awards | (2,222) | (861) | |||||||||
Payment of member tax distributions | (4,843) | (14) | |||||||||
Repayment of revolving credit facility | — | (17,500) | |||||||||
Net cash used in financing activities | (7,065) | (18,375) | |||||||||
Net decrease in cash and cash equivalents | (2,672) | (31,232) | |||||||||
Cash and cash equivalents at beginning of period | 206,573 | 238,480 | |||||||||
Cash and cash equivalents at end of period | $ | 203,901 | $ | 207,248 | |||||||
Supplemental disclosure of cash flow information: | |||||||||||
Cash paid for interest | $ | 75 | $ | 167 | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||||||
Stock-based compensation included in capitalized software development costs | $ | 2,921 | $ | 2,003 | |||||||
Operating lease assets obtained in exchange for operating lease liabilities | $ | 214 | $ | — | |||||||
Capitalized assets financed by accounts payable and accrued liabilities | $ | 636 | $ | 314 | |||||||
Accrued member tax distributions | $ | 782 | $ | 19 |
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•The Company amended and restated its certificate of incorporation, under which the Company is authorized to issue up to 450,000,000 shares of Class A common stock, up to 150,000,000 shares of Class B common stock, and up to 10,000,000 shares of preferred stock; |
|
•The limited liability company agreement of Viant Technology LLC was amended and restated (as amended and restated, the “Viant Technology LLC Agreement”) to, among other things, provide for Class A units and Class B units and appoint the Company as the sole managing member of Viant Technology LLC; |
|
•The Viant Technology LLC Agreement classified the interests acquired by the Company as Class A units, reclassified the interests held by the continuing members of Viant Technology LLC as Class B units, and permits the continuing members of Viant Technology LLC to exchange Class B units for shares of Class A common stock of Viant Technology Inc. on a one-for-one basis or, at the election of Viant Technology Inc., for cash at the current fair value on the date of the exchange. Immediately following such reclassification, the continuing members held 48,935,559 Class B units. For each membership unit of Viant Technology LLC that was reclassified as a Class B unit, the Company issued one corresponding share of our Class B common stock to the continuing members, or 48,935,559 shares of Class B common stock in total; |
|
•The Company issued and sold 10,000,000 shares of its Class A common stock to the underwriters at an IPO price of $25.00 per share, for gross proceeds of $250.0 million before deducting underwriting discounts and commissions of $17.5 million; |
|
•The Company used the net proceeds of $232.5 million to acquire 10,000,000 newly issued Class A units of Viant Technology LLC at a per-unit price equal to the per-share price paid by the underwriters for shares of our Class A common stock; |
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8
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Viant
Management believes that the accompanying condensed consolidated financial statements reflect the adjustments necessary for the fair statement of its condensed consolidated balance sheets, as of September 30, 2022 and December 31, 2021, statements of operations, for the three and nine months ended September 30, 2022 and 2021, and cash flows for the nine months ended September 30, 2022 and 2021.included in this report. The condensed consolidated balance sheet as of December 31, 20212022 was derived from the audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. Certain information and disclosures normally included in the Company's consolidated financial statements prepared in accordance with GAAP have been omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2021.2022.
Certain reclassifications have been made within the condensed consolidated financial statements for the prior period to conform with current presentation.
9
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
2022.
As of September 30, 2022, the
periods as a result.
Cash equivalents are valued based on Level 1 inputs which consist of quoted prices in active markets. As of June 30, 2023, cash equivalents includes money market funds of $183.1 million.
|
| (in thousands) |
| |
Balance as of December 31 |
| $ | 54 |
|
Provision for doubtful accounts |
|
| 51 |
|
Write-offs, net of recoveries |
|
| (1 | ) |
Balance as of March 31 |
| $ | 104 |
|
Provision for doubtful accounts |
|
| 1 |
|
Write-offs, net of recoveries |
|
| — |
|
Balance as of June 30 |
| $ | 105 |
|
Provision for doubtful accounts |
|
| 783 |
|
Write-offs, net of recoveries |
|
| — |
|
Balance as of September 30 |
| $ | 888 |
|
(in thousands) | |||||
Balance as of December 31, 2022 | $ | 1,015 | |||
Cumulative impact of accounting adoption | 209 | ||||
Provision for doubtful accounts | 22 | ||||
Write-offs, net of recoveries | (84) | ||||
Balance as of March 31, 2023 | $ | 1,162 | |||
Provision for doubtful accounts | 27 | ||||
Write-offs, net of recoveries | (54) | ||||
Balance as of June 30, 2023 | $ | 1,135 |
10
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
As of September 30, 2022, one individual supplier accounted for 15.3%12.2% of consolidated accounts payable and accrued liabilities. As of December 31, 2021,2022, one individual supplier accounted for 16.8%24.6% of consolidated accounts payable and accrued liabilities.
The following table provides
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
Advertising Agency Holding Company |
|
|
|
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|
|
|
|
|
|
|
|
|
|
A |
|
| 20.3 | % |
|
| 16.3 | % |
|
| 13.9 | % |
|
| 10.2 | % |
B |
| <10.0 | % |
| <10.0 | % |
| <10.0 | % |
|
| 11.8 | % |
Operating Leases
See Note 5—Leases.
JOBS Act Election as an Emerging Growth Company
Measurement of
Codification Improvements
In October 2020, the FASB issued ASU No. 2020-10, Codification Improvements,which updates various codification topics by clarifying disclosure requirements to align with the SEC’s regulations. The guidance is effective for the Company’s annual reporting period beginning after December 15, 2021 and interim reporting periods within the annual period beginning after December 15, 2022. The Company is currently assessing the impact this guidance will have on its condensed consolidated financial statements.
11
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
Recently Adopted Accounting Pronouncements
Leases
In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires an entity to recognize operating lease assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements.instruments. We adopted this standard at the beginning of fiscal 2022. See Note 5—Leases2023. As a result, we revised the impairment model to utilize an expected loss methodology in place of an incurred loss methodology related to our allowance for additional information.
Issuer’s Accountingcredit losses on our trade accounts receivable. We evaluate our allowance for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options
In May 2021, the FASB issued ASU No. 2021-04, Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options, which clarifies an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modifications or exchanges. The ASU requires issuers to account for the modifications or exchangescredit losses based on the economic substancehistorical bad debt experience, our assessment of the modification or exchangefinancial condition of companies with which we do business, current macroeconomic conditions, and whether the transaction was done to issue equity, to issue or modify debt, or for other reasons. We adopted this standard prospectively on January 1, 2022.reasonable and supportable forecasts of future macroeconomic conditions. The adoption did not have ana material impact on ourthe Company's condensed consolidated financial statements.
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Over-time revenue |
| $ | 133 |
|
| $ | 1,136 |
|
| $ | 494 |
|
| $ | 3,344 |
| Over-time revenue | $ | 783 | $ | 173 | $ | 1,169 | $ | 361 | ||||||||||||||
Point-in-time revenue |
|
| 48,697 |
|
|
| 49,721 |
|
|
| 142,165 |
|
|
| 138,068 |
| Point-in-time revenue | 56,440 | 51,027 | 97,774 | 93,468 | ||||||||||||||||||
Total revenue |
| $ | 48,830 |
|
| $ | 50,857 |
|
| $ | 142,659 |
|
| $ | 141,412 |
| Total revenue | $ | 57,223 | $ | 51,200 | $ | 98,943 | $ | 93,829 |
Remaining deferred revenue that is anticipated to be recognized during the succeeding 12-monthtwelve month period is recorded in the current portion of deferred revenue within the condensed consolidated balance sheets.
|
| As of September 30, |
|
| As of December 31, |
| As of June 30, | As of December 31, | |||||||||||
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | |||||||||||
Capitalized software development costs |
| $ | 69,782 |
|
| $ | 61,490 |
| Capitalized software development costs | $ | 81,828 | $ | 72,988 | ||||||
Computer equipment |
|
| 1,056 |
|
|
| 1,823 |
| Computer equipment | 1,371 | 1,116 | ||||||||
Purchased software |
|
| 32 |
|
|
| 32 |
| Purchased software | 32 | 32 | ||||||||
Furniture, fixtures and office equipment |
|
| 1,201 |
|
|
| 1,159 |
| Furniture, fixtures and office equipment | 957 | 1,226 | ||||||||
Leasehold improvements |
|
| 2,463 |
|
|
| 2,178 |
| Leasehold improvements | 2,090 | 2,571 | ||||||||
Total property, equipment and software |
|
| 74,534 |
|
|
| 66,682 |
| Total property, equipment and software | 86,278 | 77,933 | ||||||||
Less: Accumulated depreciation |
|
| (51,853 | ) |
|
| (44,351 | ) | Less: Accumulated depreciation | (60,449) | (54,827) | ||||||||
Total property, equipment and software, net |
| $ | 22,681 |
|
| $ | 22,331 |
| Total property, equipment and software, net | $ | 25,829 | $ | 23,106 |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Platform operations |
| $ | 2,510 |
|
| $ | 2,080 |
|
| $ | 7,219 |
|
| $ | 5,424 |
| Platform operations | $ | 2,910 | $ | 2,573 | $ | 5,622 | $ | 4,709 | ||||||||||||||
Sales and marketing |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
| Sales and marketing | — | — | — | — | ||||||||||||||||||
Technology and development |
|
| 432 |
|
|
| 421 |
|
|
| 1,250 |
|
|
| 1,185 |
| Technology and development | 383 | 223 | 776 | 818 | ||||||||||||||||||
General and administrative |
|
| 147 |
|
|
| 164 |
|
|
| 436 |
|
|
| 494 |
| General and administrative | 144 | 153 | 291 | 289 | ||||||||||||||||||
Total |
| $ | 3,089 |
|
| $ | 2,665 |
|
| $ | 8,905 |
|
| $ | 7,103 |
| Total | $ | 3,437 | $ | 2,949 | $ | 6,689 | $ | 5,816 |
At the beginning of fiscal 2022, the Company adopted new lease accounting guidance issued by the FASB. The most significant change requires lessees to record the present value of operating lease payments as operating leaseassetsand leaseliabilitieson itsbalancesheetand disclosekey informationaboutleasingarrangements.
We adopted the new guidance using the modified retrospective method at the beginning of fiscal 2022. As such, the condensed consolidated balance sheets for prior periods are not comparable to our fiscal 2022 periods.The Company adopted the new guidance by applying the package of practical expedients permitted under the transition guidance, which allowed the Company to carry forward its original assessment of whether:
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|
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|
|
The adoption of the new guidance resulted in the recognition of operating lease assets of approximately $21.0 million and operating lease liabilities of approximately $22.0 million, which were measured by the present value of the remaining minimum lease payments. In accordance with the guidance, the Company elected the practical expedient to exclude leases with a term of less than one year from the measurement of operating lease assets and lease liabilities. The Company also elected the practical expedient that allows lessees the option to account for lease and non-lease components together as a single component for all real estate classes of underlying assets. At adoption, in the condensed consolidated balance sheet, we also reclassified deferred rent of approximately $1.0 million for operating leases at the end of the fiscal year ended December 31, 2021 from other current liabilities (current portion) and other long-term liabilities (non-current portion) to current portion of operating lease liabilities and long-term portion of operating lease liabilities, respectively. The impact on the Company’s condensed consolidated statements of operations and cash flows was not material.
The present value of the lease payments was calculated using the Company’s incremental borrowing rate applicable to the lease, which is determined by estimating what it would cost the Company to borrow a collateralized amount equal to the total lease payments over the lease term based on the contractual terms of the lease and the location of the leased asset.
Lessee Arrangements
The Company has
We determine whether an arrangement is a lease at the contract inception date. Our leases may require us to make fixed rental payments or variable lease payments, which are based on a variety of factors including property values, tax and utility rates, property services fees, and other factors. Since these costs are variable in nature, they are excluded from the measurement of the reported operating lease assets and liabilities and are expensed as incurred.The Company records rent expense for operating leases, some of which have escalating rent payments, on a straight-line basis over the lease term.
13
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
considered in calculating the term of the lease.
As of September 30, 2022, the Company had entered into an operating lease for office space in New York with total estimated future lease payments of $5.0 million that had not yet commenced and therefore is not included in the measurement of the operating right-of-use asset and operating lease liability on the condensed consolidated balance sheet. The lease term is expected to commence in the fourth quarter of fiscal 2022. In conjunction with this lease, PNC Bank, National Association (“PNC Bank”) will issue a standby letter of credit for the amount of $0.4 million in favor of the lessor, to satisfy the security deposit of the leased property.
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
|
| 2022 |
|
| 2022 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||
Operating lease cost |
| $ | 915 |
|
| $ | 2,542 |
| Operating lease cost | $ | 1,200 | $ | 812 | $ | 2,421 | $ | 1,624 | ||||||||||||||
Short-term lease cost |
|
| 341 |
|
|
| 1,045 |
| Short-term lease cost | 81 | 355 | 341 | 698 | ||||||||||||||||||
Variable lease cost |
|
| 23 |
|
|
| 113 |
| Variable lease cost | — | 2 | 9 | 99 | ||||||||||||||||||
Total lease cost |
| $ | 1,279 |
|
| $ | 3,700 |
| Total lease cost | $ | 1,281 | $ | 1,169 | $ | 2,771 | $ | 2,421 |
Future minimum lease payments as of September 30, 2022 were as follows:
|
| As of September 30, |
| |
Year |
| 2022 |
| |
Remainder of 2022 |
| $ | 813 |
|
2023 |
|
| 4,506 |
|
2024 |
|
| 4,334 |
|
2025 |
|
| 4,270 |
|
2026 |
|
| 4,257 |
|
Thereafter |
|
| 14,992 |
|
Total undiscounted future lease payments |
|
| 33,172 |
|
Less: Commitments for leases not yet commenced |
|
| (5,016 | ) |
Less: Imputed interest |
|
| (3,376 | ) |
Present value of operating lease liabilities |
|
| 24,780 |
|
Less: Operating lease liabilities, current |
|
| (2,813 | ) |
Operating lease liabilities, noncurrent |
| $ | 21,967 |
|
14
Disclosures related to periods prior to the adoption of ASC 842
Rent expense
|
| As of December 31, |
| As of June 30, | |||||
Year |
| 2021 |
| Year | 2023 | ||||
2022 |
| $ | 3,039 |
| |||||
2023 |
|
| 3,953 |
| |||||
Remainder of 2023 | Remainder of 2023 | $ | 2,512 | ||||||
2024 |
|
| 3,060 |
| 2024 | 4,417 | |||
2025 |
|
| 2,991 |
| 2025 | 4,303 | |||
2026 |
|
| 2,974 |
| 2026 | 4,291 | |||
2027 | 2027 | 4,216 | |||||||
Thereafter |
|
| 13,739 |
| Thereafter | 10,934 | |||
Total minimum payments |
| $ | 29,756 |
| |||||
Total undiscounted future lease payments | Total undiscounted future lease payments | 30,673 | |||||||
Less: Imputed interest | Less: Imputed interest | (3,421) | |||||||
Present value of operating lease liabilities | Present value of operating lease liabilities | 27,252 | |||||||
Less: Operating lease liabilities, current | Less: Operating lease liabilities, current | (3,918) | |||||||
Operating lease liabilities, noncurrent | Operating lease liabilities, noncurrent | $ | 23,334 |
|
| As of September 30, 2022 |
| As of June 30, 2023 | |||||||||||||||||||||||||||||||||||
|
| Remaining Weighted-Average Useful Life (years) |
|
| Gross Amount |
|
| Accumulated Amortization |
|
| Net Carrying Amount |
| Remaining Weighted-Average Useful Life (years) | Gross Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||||||
Developed technology |
|
| 0.3 |
|
| $ | 4,927 |
|
| $ | (4,693 | ) |
| $ | 234 |
| Developed technology | — | $ | 4,927 | $ | (4,927) | $ | — | |||||||||||||||
Customer relationships |
|
| 1.3 |
|
|
| 2,300 |
|
|
| (1,862 | ) |
|
| 438 |
| Customer relationships | 0.6 | 2,300 | (2,108) | 192 | ||||||||||||||||||
Trademarks/tradenames |
|
| 3.4 |
|
|
| 1,400 |
|
|
| (1,127 | ) |
|
| 273 |
| Trademarks/tradenames | 2.7 | 1,400 | (1,187) | 213 | ||||||||||||||||||
Total |
|
|
|
|
| $ | 8,627 |
|
| $ | (7,682 | ) |
| $ | 945 |
| Total | $ | 8,627 | $ | (8,222) | $ | 405 |
|
| As of December 31, 2021 |
| |||||||||||||
|
| Remaining Weighted- Average Useful Life (years) |
|
| Gross Amount |
|
| Accumulated Amortization |
|
| Net Carrying Amount |
| ||||
Developed technology |
|
| 1.1 |
|
| $ | 4,927 |
|
| $ | (4,169 | ) |
| $ | 758 |
|
Customer relationships |
|
| 2.1 |
|
|
| 2,300 |
|
|
| (1,615 | ) |
|
| 685 |
|
Trademarks/tradenames |
|
| 4.0 |
|
|
| 1,400 |
|
|
| (1,057 | ) |
|
| 343 |
|
Total |
|
|
|
|
| $ | 8,627 |
|
| $ | (6,841 | ) |
| $ | 1,786 |
|
As of December 31, 2022 | |||||||||||||||||||||||
Remaining Weighted- Average Useful Life (years) | Gross Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
Developed technology | 0.1 | $ | 4,927 | $ | (4,869) | $ | 58 | ||||||||||||||||
Customer relationships | 1.1 | 2,300 | (1,944) | 356 | |||||||||||||||||||
Trademarks/tradenames | 3.2 | 1,400 | (1,147) | 253 | |||||||||||||||||||
Total | $ | 8,627 | $ | (7,960) | $ | 667 |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Platform operations |
| $ | 175 |
|
| $ | 175 |
|
| $ | 525 |
|
| $ | 525 |
| Platform operations | $ | — | $ | 175 | $ | 58 | $ | 350 | ||||||||||||||
Sales and marketing |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
| Sales and marketing | — | — | — | — | ||||||||||||||||||
Technology and development |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
| Technology and development | — | — | — | — | ||||||||||||||||||
General and administrative |
|
| 102 |
|
|
| 132 |
|
|
| 316 |
|
|
| 396 |
| General and administrative | 102 | 102 | 204 | 214 | ||||||||||||||||||
Total |
| $ | 277 |
|
| $ | 307 |
|
| $ | 841 |
|
| $ | 921 |
| Total | $ | 102 | $ | 277 | $ | 262 | $ | 564 |
15
|
| As of September 30, |
| As of June 30, | |||||
Year |
| 2022 |
| Year | 2023 | ||||
Remainder of 2022 |
| $ | 277 |
| |||||
2023 |
|
| 468 |
| |||||
Remainder of 2023 | Remainder of 2023 | $ | 204 | ||||||
2024 |
|
| 107 |
| 2024 | 107 | |||
2025 |
|
| 80 |
| 2025 | 80 | |||
2026 |
|
| 13 |
| 2026 | 14 | |||
2027 | 2027 | — | |||||||
Thereafter |
|
| — |
| Thereafter | — | |||
Total |
| $ | 945 |
| Total | $ | 405 |
|
| As of September 30, |
|
| As of December 31, |
| As of June 30, | As of December 31, | |||||||||||
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | |||||||||||
Accrued traffic acquisition costs |
| $ | 24,790 |
|
| $ | 30,942 |
| Accrued traffic acquisition costs | $ | 24,861 | $ | 29,631 | ||||||
Other accrued liabilities |
|
| 3,412 |
|
|
| 3,144 |
| Other accrued liabilities | 4,970 | 5,432 | ||||||||
Total accrued liabilities |
| $ | 28,202 |
|
| $ | 34,086 |
| Total accrued liabilities | $ | 29,831 | $ | 35,063 |
2023, respectively, and $0.4 million for the three and six months ended June 30, 2022.
Revolving Credit Facility
The Amended Loan Agreement contains customary conditions to borrowings, events of default and covenants, including covenants that restrict our ability to sell assets, make changes to the nature of the business, engage in mergers or acquisitions, incur, assume or permit to exist additional indebtedness and guarantees, create or permit to exist liens, pay dividends, issue equity instruments, make distributions or redeem or repurchase capital stock or make other investments, and engage in transactions with affiliates. The Amended Loan Agreement also requires that we maintain compliance with a minimum Fixed Charge Coverage Ratio (as
16
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
On May 6, 2022,covenants as part of the Company fully paid offAmended Loan Agreement.
The carrying value as of December 31, 2021 was $17.5 million, which was recorded in “Long-term debt” on the condensed consolidated balance sheet and approximated its fair value as the interest rate is variable and approximates prevailing market interest rates for similar debt arrangements. The fair value of debt was estimated using primarily level 2 inputs including quoted market priceseither a Domestic Rate Loan or discounted cash flow analyses, based on estimated incremental borrowing rates for similar types of borrowing arrangements.
PPP Loan
On April 14, 2020, the Company received proceeds from a Paycheck Protection Program Loan (the “PPP Loan”) in the amount of approximately $6.0 million from PNC Bank, as lender, pursuant to the Paycheck Protection Program of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The PPP Loan, which was evidenced by a note dated April 11, 2020,LIBOR Rate Loan. For Domestic Rate Loans, borrowings bore interest at the Alternate Base Rate plus an annualapplicable margin. The Alternate Base Rate was defined as a fluctuating interest rate equal to the greater of (1) the base commercial lending rate of 1.0%PNC Bank, (2) the overnight federal funds rate plus 0.50% and matured(3) the Daily LIBOR Rate plus 1.00%. For LIBOR Rate Loans, borrowings bore interest at the LIBOR Rate (as defined in the Loan Agreement) plus an applicable margin. The applicable margin was between 0.75% to 1.25% for Domestic Rate Loans and between 1.75% and 2.25% for LIBOR Rate Loans based on April 11, 2022. No interest or principal was due during the first fifteen months after April 11, 2020, although interest continued to accrue over this fifteen-month deferral period.
Proceeds from loans grantedmaintaining certain undrawn availability ratios. The facility fee for undrawn amounts under the CARES Act were to be used for payroll, costs to continue employee group health care benefits, rent, utilities and certain other qualified costs (collectively, “qualifying expenses”). The Company used the PPP Loan proceeds for qualifying expenses. In June 2021, Agreement was 0.375% per annum.
9. Stock-Based Compensation
2023
.
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Platform operations |
| $ | 1,233 |
|
| $ | 3,142 |
|
| $ | 3,622 |
|
| $ | 11,843 |
| Platform operations | $ | 1,124 | $ | 1,303 | $ | 2,016 | $ | 2,389 | ||||||||||||||
Sales and marketing |
|
| 2,324 |
|
|
| 4,859 |
|
|
| 6,929 |
|
|
| 23,586 |
| Sales and marketing | 2,520 | 2,426 | 5,032 | 4,605 | ||||||||||||||||||
Technology and development |
|
| 1,430 |
|
|
| 3,015 |
|
|
| 4,024 |
|
|
| 10,983 |
| Technology and development | 1,507 | 1,425 | 2,834 | 2,594 | ||||||||||||||||||
General and administrative |
|
| 2,724 |
|
|
| 4,399 |
|
|
| 7,280 |
|
|
| 15,780 |
| General and administrative | 3,378 | 2,614 | 6,119 | 4,556 | ||||||||||||||||||
Total |
| $ | 7,711 |
|
| $ | 15,415 |
|
| $ | 21,855 |
|
| $ | 62,192 |
| Total | $ | 8,529 | $ | 7,768 | $ | 16,001 | $ | 14,144 |
17
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
|
| Number of Shares (in thousands) |
|
| Weighted-Average Grant Date Fair Value |
| |||||||||||||
RSUs outstanding as of December 31, 2021 |
|
| 3,033 |
|
| $ | 24.29 |
| |||||||||||
Number of Shares (in thousands) | Weighted-Average Grant Date Fair Value | ||||||||||||||||||
RSUs outstanding as of December 31, 2022 | RSUs outstanding as of December 31, 2022 | 3,928 | $ | 12.59 | |||||||||||||||
Granted |
|
| 2,284 |
|
|
| 6.16 |
| Granted | 1,406 | 4.41 | ||||||||
Vested |
|
| (342 | ) |
|
| 25.02 |
| Vested | (800) | 13.38 | ||||||||
Canceled/forfeited |
|
| (117 | ) |
|
| 23.92 |
| Canceled/forfeited | (38) | 7.02 | ||||||||
RSUs outstanding as of March 31, 2022 |
|
| 4,858 |
|
|
| 15.72 |
| |||||||||||
RSUs outstanding as of March 31, 2023 | RSUs outstanding as of March 31, 2023 | 4,496 | 9.94 | ||||||||||||||||
Granted |
|
| 365 |
|
|
| 6.07 |
| Granted | 221 | 4.49 | ||||||||
Vested |
|
| (322 | ) |
|
| 24.69 |
| Vested | (432) | 19.25 | ||||||||
Canceled/forfeited |
|
| (120 | ) |
|
| 13.64 |
| Canceled/forfeited | (45) | 8.36 | ||||||||
RSUs outstanding as of June 30, 2022 |
|
| 4,781 |
|
|
| 14.43 |
| |||||||||||
Granted |
|
| 232 |
|
|
| 4.81 |
| |||||||||||
Vested |
|
| (350 | ) |
|
| 23.22 |
| |||||||||||
Canceled/forfeited |
|
| (242 | ) |
|
| 10.47 |
| |||||||||||
RSUs outstanding as of September 30, 2022 |
|
| 4,421 |
|
|
| 13.45 |
| |||||||||||
RSUs outstanding as of June 30, 2023 | RSUs outstanding as of June 30, 2023 | 4,240 | 8.72 |
|
| Number of Options (in thousands) |
|
| Weighted-Average Exercise Price |
|
| Weighted-Average Remaining Contractual Term (years) |
|
| Aggregate Intrinsic Value (in thousands) |
| |||||||||||||||||||||||||||
Outstanding as of December 31, 2021 |
|
| 220 |
|
| $ | 15.88 |
|
|
| 9.7 |
|
| $ | 20 |
| |||||||||||||||||||||||
Number of Options (in thousands) | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||||||||||||||||||
Outstanding as of December 31, 2022 | Outstanding as of December 31, 2022 | 3,661 | $ | 6.14 | 9.2 | $ | — | ||||||||||||||||||||||||||||||||
Granted |
|
| 3,565 |
|
|
| 6.09 |
|
|
|
|
|
|
|
|
| Granted | 2,127 | 4.43 | ||||||||||||||||||||
Exercised |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| Exercised | — | — | ||||||||||||||||||||
Canceled |
|
| (14 | ) |
|
| 12.02 |
|
|
|
|
|
|
|
|
| Canceled | (8) | 10.35 | ||||||||||||||||||||
Expired |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| Expired | (25) | 22.65 | ||||||||||||||||||||
Outstanding as of March 31, 2022 |
|
| 3,771 |
|
|
| 6.64 |
|
|
| 9.9 |
|
|
| 1,891 |
| |||||||||||||||||||||||
Outstanding as of March 31, 2023 | Outstanding as of March 31, 2023 | 5,755 | 5.43 | 9.3 | 33 | ||||||||||||||||||||||||||||||||||
Granted |
|
| 216 |
|
|
| 6.16 |
|
|
|
|
|
|
|
|
| Granted | 37 | 4.40 | ||||||||||||||||||||
Exercised |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| Exercised | — | — | ||||||||||||||||||||
Canceled |
|
| (89 | ) |
|
| 7.88 |
|
|
|
|
|
|
|
|
| Canceled | (28) | 5.17 | ||||||||||||||||||||
Expired |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| Expired | (1) | 32.93 | ||||||||||||||||||||
Outstanding as of June 30, 2022 |
|
| 3,898 |
|
|
| 6.58 |
|
|
| 9.7 |
|
|
| — |
| |||||||||||||||||||||||
Granted |
|
| 246 |
|
|
| 4.77 |
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Exercised |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Canceled |
|
| (242 | ) |
|
| 8.58 |
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Expired |
|
| — |
|
|
| — |
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Outstanding as of September 30, 2022 |
|
| 3,902 |
|
|
| 6.35 |
|
|
| 9.4 |
|
|
| — |
| |||||||||||||||||||||||
Outstanding as of June 30, 2023 | Outstanding as of June 30, 2023 | 5,763 | 5.42 | 9.1 | 439 | ||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Vested and exercisable |
|
| 42 |
|
|
| 19.23 |
|
|
| 6.4 |
|
|
| — |
| Vested and exercisable | 1,062 | 6.15 | 8.7 | — |
18
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
2023.
| Three and Nine Months Ended September 30, |
| Three and Nine Months Ended September 30, | Three and Six Months Ended June 30, | ||||||||||
| 2022 |
| 2021 | 2023 | 2022 | |||||||||
Risk free interest rate | 1.4% - 2.0% |
| 1.2% | Risk free interest rate | 4.3% | 1.4% - 2.0% | ||||||||
Expected volatility | 61.5% - 62.7% |
| 61.1% | Expected volatility | 81.5% | 61.5% - 62.7% | ||||||||
Expected term (in years) | 5.9 - 6.0 |
| 5.9 | Expected term (in years) | 6.0 | 5.9 - 6.0 | ||||||||
Expected dividend yield | 0.0% |
| 0.0% | Expected dividend yield | 0.0% | 0.0% |
2022.
19
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Numerator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Numerator | ||||||||||||||||||||||
Net loss |
| $ | (12,426 | ) |
| $ | (12,160 | ) |
| $ | (40,081 | ) |
| $ | (45,127 | ) | Net loss | $ | (3,203) | $ | (14,092) | $ | (12,579) | $ | (27,655) | ||||||||||||||
Less: Net loss attributable to noncontrolling interests |
|
| (9,300 | ) |
|
| (9,623 | ) |
|
| (30,362 | ) |
|
| (35,829 | ) | Less: Net loss attributable to noncontrolling interests | (2,140) | (10,691) | (9,036) | (21,062) | ||||||||||||||||||
Net loss attributable to Viant Technology Inc. |
| $ | (3,126 | ) |
| $ | (2,537 | ) |
| $ | (9,719 | ) |
| $ | (9,298 | ) | Net loss attributable to Viant Technology Inc. | $ | (1,063) | $ | (3,401) | $ | (3,543) | $ | (6,593) | ||||||||||||||
Denominator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Denominator | ||||||||||||||||||||||
Weighted-average shares of Class A common stock outstanding—basic and diluted |
|
| 14,306 |
|
|
| 12,489 |
|
|
| 14,078 |
|
|
| 11,894 |
| Weighted-average shares of Class A common stock outstanding—basic and diluted | 15,135 | 14,114 | 14,943 | 13,962 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Loss per share of Class A common stock—basic |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
| $ | (0.69 | ) |
| $ | (0.78 | ) | Loss per share of Class A common stock—basic | $ | (0.07) | $ | (0.24) | $ | (0.24) | $ | (0.47) | ||||||||||||||
Loss per share of Class A common stock—diluted |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
| $ | (0.69 | ) |
| $ | (0.78 | ) | Loss per share of Class A common stock—diluted | $ | (0.07) | $ | (0.24) | $ | (0.24) | $ | (0.47) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Anti-dilutive shares excluded from loss per share of Class A common stock—diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Anti-dilutive shares excluded from loss per share of Class A common stock—diluted: | ||||||||||||||||||||||
Restricted stock units |
|
| 4,421 |
|
|
| 3,385 |
|
|
| 4,421 |
|
|
| 3,385 |
| Restricted stock units | 4,240 | 4,781 | 4,240 | 4,781 | ||||||||||||||||||
Nonqualified stock options |
|
| 3,902 |
|
|
| 147 |
|
|
| 3,902 |
|
|
| 147 |
| Nonqualified stock options | 5,763 | 3,898 | 5,763 | 3,898 | ||||||||||||||||||
Shares of Class B common stock |
|
| 47,082 |
|
|
| 47,137 |
|
|
| 47,082 |
|
|
| 47,137 |
| Shares of Class B common stock | 47,082 | 47,082 | 47,082 | 47,082 | ||||||||||||||||||
Total shares excluded from loss per share of Class A common stock—diluted |
|
| 55,405 |
|
|
| 50,669 |
|
|
| 55,405 |
|
|
| 50,669 |
| Total shares excluded from loss per share of Class A common stock—diluted | 57,085 | 55,761 | 57,085 | 55,761 |
We are
20
VIANT TECHNOLOGY INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited; tabular dollars in thousands, except for per share data)
|
| As of September 30, 2022 |
|
| As of December 31, 2021 |
| As of June 30, 2023 | As of December 31, 2022 | |||||||||||||||||||||||||||||||
Owner |
| Units Owned |
|
| Ownership Percentage |
|
| Units Owned |
|
| Ownership Percentage |
| Owner | Units Owned | Ownership Percentage | Units Owned | Ownership Percentage | ||||||||||||||||||||||
Viant Technology Inc. |
|
| 14,460,084 |
|
|
| 23.5 | % |
|
| 13,704,638 |
|
|
| 22.5 | % | Viant Technology Inc. | 15,342,563 | 24.6 | % | 14,643,798 | 23.7 | % | ||||||||||||||||
Noncontrolling interests |
|
| 47,082,260 |
|
|
| 76.5 | % |
|
| 47,107,130 |
|
|
| 77.5 | % | Noncontrolling interests | 47,082,260 | 75.4 | % | 47,082,260 | 76.3 | % | ||||||||||||||||
Total |
|
| 61,542,344 |
|
|
| 100.0 | % |
|
| 60,811,768 |
|
|
| 100.0 | % | Total | 62,424,823 | 100.0 | % | 61,726,058 | 100.0 | % |
During the nine months ended September 30, 2022, noncontrolling interests exchanged 24,870 Class B units of Viant Technology LLC for 24,870 shares of the Company’s Class A common stock, which also resulted in the cancellation of 24,870 shares of the Company’s Class B common stock that was previously held by noncontrolling interests with no additional consideration provided.
2023.
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Net loss attributable to Viant Technology Inc. |
| $ | (3,126 | ) |
| $ | (2,537 | ) |
| $ | (9,719 | ) |
| $ | (9,298 | ) | Net loss attributable to Viant Technology Inc. | $ | (1,063) | $ | (3,401) | $ | (3,543) | $ | (6,593) | ||||||||||||||
Transfers to noncontrolling interests: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Transfers to noncontrolling interests: | ||||||||||||||||||||||
Decrease in the additional-paid-in-capital of Viant Technology Inc. resulting from ownership changes in Viant Technology LLC |
|
| (5,384 | ) |
|
| (40,427 | ) |
|
| (15,115 | ) |
|
| (40,427 | ) | Decrease in the additional-paid-in-capital of Viant Technology Inc. resulting from ownership changes in Viant Technology LLC | (3,956) | (5,455) | (6,333) | (9,731) | ||||||||||||||||||
Change from net loss attributable to Viant Technology Inc. and transfers to noncontrolling interests |
| $ | (8,510 | ) |
| $ | (42,964 | ) |
| $ | (24,834 | ) |
| $ | (49,725 | ) | Change from net loss attributable to Viant Technology Inc. and transfers to noncontrolling interests | $ | (5,019) | $ | (8,856) | $ | (9,876) | $ | (16,324) |
21
Forward-Looking Statements
This Quarterly Report on Form 10-Q2, 2023. In addition to historical financial information, the following discussion and analysis contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,that involve risks and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements generally relateuncertainties which could cause our actual results to future events or our future financial or operating performance and may include statements concerning, among other things, our business strategy (includingdiffer materially from those anticipated trends and developments in and management plans for, our business and the markets in which we operate), financial results, the sufficiency of our cash and cash equivalents and cash provided by sales of our products and services to meet our liquidity needs, the impact of the ongoing COVID-19 pandemic on our business, operations, and the markets and communities in which we, our clients, and partners operate, results of operations, revenues, operating expenses, capital expenditures, sales and marketing initiatives and competition.
In some cases, you can identifythese forward-looking statements, by words such as “may,” “will,” “could,” “intend,” “consider,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict” or “continue” or the negative or plural of these words or other similar terms or expressions. All statements other than statements of historical fact are forward-looking statements, which speak only as of the date they are made, are not guarantees of future performance. All of our forward-looking statements are subject to a number of risks, uncertainties and other factors, including, but not limited to, the risks and uncertainties discussed under the heading
future.
Our demand side platform (“DSP”),
We serve marketers and their advertising agencies by enabling them to plan, buy and measure programmatic campaigns. We provide
customers recognize its benefits.
22
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
is eitherprimarily a percentage of spend or a flat monthly subscription.spend. Customers who prefer to use our fixed CPM pricing option enter into insertion order (“IO”) arrangements with us, and we generate revenue by charging these customers a platform fee at a price for every 1,000 impressions an ad receives. We also offer different service options to our customers accessing our platform under an MSA or an IO to enable them to use our services to aid them in data management, media execution and advanced reporting. When customers utilize our services, we generate revenue by charging a service fee separate from the platform fee consisting of (1) a fee that represents a percentage of spend; (2) a flat monthly fee covering services in connection with data management and advanced reporting; or (3) a fixed CPM that is inclusive of media, other direct costs and services.
|
|
•Revenue of $57.2 million and $51.2 million, representing an increase of 11.8%; |
|
•Gross profit of $23.7 million and $20.3 million, representing an increase of 17.0%; |
|
•Contribution ex-TAC1 of $33.7 million and $31.7 million, representing an increase of 6.2%; |
|
•Net loss of $3.2 million and $14.1 million, representing an improvement of 77.3%; |
|
•Non-GAAP net income (loss)1 of $5.1 million and $(5.9) million, representing an increase of 185.9%; and •Adjusted EBITDA1 of $6.8 million and $(3.1) million, representing an increase of 321.5%. 21 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (unaudited; tabular dollars in thousands, except per share data) |
|
Our financial results for the ninesix months ended September
•Revenue of $98.9 million and $93.8 million, representing an increase of 5.5%; •Gross profit of $42.1 million and $36.7 million, representing an increase of 14.7%; •Contribution ex-TAC1 of $61.7 million and $59.3 million, representing an increase of 4.0%; •Net loss of $12.6 million and $27.7 million, representing an improvement of 54.5%; •Non-GAAP net income (loss)1 of $3.2 million and $(12.7) million, representing an increase of 125.5%; and •Adjusted EBITDA1 of $6.4 million and $(7.0) million, representing an increase of 192.4%. (1) |
|
|
|
|
|
|
|
|
|
|
|
* Contribution ex-TAC, non-GAAP net income (loss) and adjusted EBITDA are non-GAAP financial measures. For a detailed discussion of our key operating and financial performance measures and a reconciliation of contribution ex-TAC, non-GAAP net income (loss) and adjusted EBITDA to the most directly comparable financial measures calculated in accordance with generally accepted accounting principles in the United States of America (“GAAP”), see “—Key Operating and Financial Performance Measures—Use of Non-GAAP Financial Measures.”
23
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
regarding future enhancements to our software. We believe the percentage change in advertiser spend across our platform is a useful metric for investors because it allows investors to evaluate our operational performance in the same manner as our management and board of directors. For a detailed discussion of our key operating measures including the definition of active customers, see “—Key Operating and Financial Performance Measures—Use of Non-GAAP Financial Measures.”
We continue to add functionality to our software to encourage our customers to increase their usage of our platform.platform as well as add new customers. We believe many advertisers are in the early stages of moving a greater percentage of their advertising budgets to programmatic channels. By providing solutions for the planning, buying and measuring of their media spend across most channels, we believe that we are well positioned to capture more of our customers’ programmatic budgets. We also continue to add functionality to our platform to encourage our customers to increase their usage. For instance, we continue to leverage artificial intelligence and machine learning in our platform to help our customers improve the efficiency and effectiveness of their advertising campaigns. Further, we intend to continue to grow our sales and marketing efforts to increase awareness of our DSP, Adelphic, and highlight the advantages of our people-based framework as cookie-based options become increasingly limited. As a result, future revenue growth depends upon
we continued to cycle through a subset of customers that do not have the capacity to scale their spend on our platform. Additionally, as our mix shift towards percentage of spend becomes less impactful and as fixed price becomes a smaller percentage of total advertiser spend, we expect contribution ex-TAC to grow faster than revenue. For a detailed discussion of our key operating measures including the definition of active customers, see “—Key Operating and Financial Performance Measures—Use of Non-GAAP Financial Measures.”
The worldwide spread of the COVID-19 pandemic resulted,conditions and may continue to result, in a global slowdown of economic activity, which decreased demand for a broad variety of goods and services, including those provided by our clients, while also disrupting supply channels, sales channels and advertising and marketing activities. We cannot be certain how long the pandemic will continue to impact economic activity and our business.
In addition to the ongoing COVID-19 pandemic, global economic and business activities continue to face widespread macroeconomic uncertainties, including labor shortages,geopolitical events, such as inflation, and monetary supply shifts, rising interest rates, tightening of credit markets, recession risks, labor shortages, supply chain disruptions, and potential disruptions from the Russia-Ukraine conflict. Whileconflict, have impacted and may continue to impact our numberbusiness and the business of activeour customers, for the twelve months ended September 30, 2022 has increased by nearly 10% over the past twelve months, we have observed decreases in revenue that we attribute to marketers in certain industry verticals decreasing or pausing theirwhile also disrupting sales channels and advertising spend due to the impacts of these macroeconomic conditions.and marketing activities. We continue to actively monitor the impact of these macroeconomic factors on our results of operations, financial condition and cash flows, and on our clients, partners, industry and employees, and have slowed the pace of ourfurther investments in sales marketing and technologymarketing as a result of these factors. The extent of the impact of these factors on our operational and financial performance, including our ability to execute our business strategies and initiatives in the expected time frame, will depend on future developments, all of which are uncertain and cannot be predicted. Due to the nature of our business, the effect of these macroeconomic conditions and geopolitical events may not be fully reflected in our results of operations until future periods.
24
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
Russia-Ukraine conflictabove, and other macroeconomic and geopolitical developments potentially indicative of an economic slowdown or recession, could cause our revenue to decrease.. Political advertising could also cause our revenue to increase during election cycles and decrease during other periods, making it difficult to predict our revenue, cash flow, and operating results, all of which could fall below our expectations. We expect our revenue to continue to fluctuate based on seasonal factors that affect the advertising industry as a whole.
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
Consolidated Statements of Operations Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
| $ | 48,830 |
|
| $ | 50,857 |
|
| $ | 142,659 |
|
| $ | 141,412 |
|
Operating expenses(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
| 27,530 |
|
|
| 28,967 |
|
|
| 84,674 |
|
|
| 85,026 |
|
Sales and marketing |
|
| 16,949 |
|
|
| 15,131 |
|
|
| 47,991 |
|
|
| 49,869 |
|
Technology and development |
|
| 5,576 |
|
|
| 6,590 |
|
|
| 15,590 |
|
|
| 20,521 |
|
General and administrative |
|
| 11,650 |
|
|
| 11,981 |
|
|
| 34,458 |
|
|
| 36,477 |
|
Total operating expenses |
|
| 61,705 |
|
|
| 62,669 |
|
|
| 182,713 |
|
|
| 191,893 |
|
Loss from operations |
|
| (12,875 | ) |
|
| (11,812 | ) |
|
| (40,054 | ) |
|
| (50,481 | ) |
Total other expense (income), net |
|
| (449 | ) |
|
| 348 |
|
|
| 27 |
|
|
| (5,354 | ) |
Net loss |
|
| (12,426 | ) |
|
| (12,160 | ) |
|
| (40,081 | ) |
|
| (45,127 | ) |
Less: Net loss attributable to noncontrolling interests |
|
| (9,300 | ) |
|
| (9,623 | ) |
|
| (30,362 | ) |
|
| (35,829 | ) |
Net loss attributable to Viant Technology Inc. |
| $ | (3,126 | ) |
| $ | (2,537 | ) |
| $ | (9,719 | ) |
| $ | (9,298 | ) |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| |||||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
|
| (% of revenue*) |
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||
Consolidated Statements of Operations Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Consolidated Statements of Operations Data: | ||||||||||||||||||||||
Revenue |
|
| 100 | % |
|
| 100 | % |
|
| 100 | % |
|
| 100 | % | Revenue | $ | 57,223 | $ | 51,200 | $ | 98,943 | $ | 93,829 | ||||||||||||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Operating expenses(1): | Operating expenses(1): | ||||||||||||||||||||||||||||||||||||||
Platform operations |
|
| 56 | % |
|
| 57 | % |
|
| 59 | % |
|
| 60 | % | Platform operations | 33,523 | 30,950 | 56,860 | 57,144 | ||||||||||||||||||
Sales and marketing |
|
| 35 | % |
|
| 30 | % |
|
| 34 | % |
|
| 35 | % | Sales and marketing | 11,691 | 17,286 | 23,860 | 31,042 | ||||||||||||||||||
Technology and development |
|
| 11 | % |
|
| 13 | % |
|
| 11 | % |
|
| 15 | % | Technology and development | 6,172 | 5,011 | 12,066 | 10,014 | ||||||||||||||||||
General and administrative |
|
| 24 | % |
|
| 24 | % |
|
| 24 | % |
|
| 26 | % | General and administrative | 11,088 | 11,725 | 22,516 | 22,808 | ||||||||||||||||||
Total operating expenses |
|
| 126 | % |
|
| 123 | % |
|
| 128 | % |
|
| 136 | % | Total operating expenses | 62,474 | 64,972 | 115,302 | 121,008 | ||||||||||||||||||
Loss from operations |
|
| (26 | )% |
|
| (23 | )% |
|
| (28 | )% |
|
| (36 | )% | Loss from operations | (5,251) | (13,772) | (16,359) | (27,179) | ||||||||||||||||||
Total other expense (income), net |
|
| (1 | )% |
|
| 1 | % |
|
| 0 | % |
|
| (4 | )% | Total other expense (income), net | (2,048) | 320 | (3,780) | 476 | ||||||||||||||||||
Net loss |
|
| (25 | )% |
|
| (24 | )% |
|
| (28 | )% |
|
| (32 | )% | Net loss | (3,203) | (14,092) | (12,579) | (27,655) | ||||||||||||||||||
Less: Net loss attributable to noncontrolling interests |
|
| (19 | )% |
|
| (19 | )% |
|
| (21 | )% |
|
| (25 | )% | Less: Net loss attributable to noncontrolling interests | (2,140) | (10,691) | (9,036) | (21,062) | ||||||||||||||||||
Net loss attributable to Viant Technology Inc. |
|
| (6 | )% |
|
| (5 | )% |
|
| (7 | )% |
|
| (7 | )% | Net loss attributable to Viant Technology Inc. | $ | (1,063) | $ | (3,401) | $ | (3,543) | $ | (6,593) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(% of revenue*) | |||||||||||||||||||||||
Consolidated Statements of Operations Data: | |||||||||||||||||||||||
Revenue | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||
Operating expenses(1): | |||||||||||||||||||||||
Platform operations | 59 | % | 60 | % | 57 | % | 61 | % | |||||||||||||||
Sales and marketing | 20 | % | 34 | % | 24 | % | 33 | % | |||||||||||||||
Technology and development | 11 | % | 10 | % | 12 | % | 11 | % | |||||||||||||||
General and administrative | 19 | % | 23 | % | 23 | % | 24 | % | |||||||||||||||
Total operating expenses | 109 | % | 127 | % | 117 | % | 129 | % | |||||||||||||||
Loss from operations | (9) | % | (27) | % | (17) | % | (29) | % | |||||||||||||||
Total other expense (income), net | (4) | % | 1 | % | (4) | % | 1 | % | |||||||||||||||
Net loss | (6) | % | (28) | % | (13) | % | (29) | % | |||||||||||||||
Less: Net loss attributable to noncontrolling interests | (4) | % | (21) | % | (9) | % | (22) | % | |||||||||||||||
Net loss attributable to Viant Technology Inc. | (2) | % | (7) | % | (4) | % | (7) | % |
(1)Stock-based compensation, depreciation, and amortization included in operating expenses are as follows: |
|
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Stock-based compensation: | |||||||||||||||||||||||
Platform operations | $ | 1,124 | $ | 1,303 | $ | 2,016 | $ | 2,389 | |||||||||||||||
Sales and marketing | 2,520 | 2,426 | 5,032 | 4,605 | |||||||||||||||||||
Technology and development | 1,507 | 1,425 | 2,834 | 2,594 | |||||||||||||||||||
General and administrative | 3,378 | 2,614 | 6,119 | 4,556 | |||||||||||||||||||
Total stock-based compensation | $ | 8,529 | $ | 7,768 | $ | 16,001 | $ | 14,144 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Depreciation: | |||||||||||||||||||||||
Platform operations | $ | 2,910 | $ | 2,573 | $ | 5,622 | $ | 4,709 | |||||||||||||||
Sales and marketing | — | — | — | — | |||||||||||||||||||
Technology and development | 383 | 223 | 776 | 818 | |||||||||||||||||||
General and administrative | 144 | 153 | 291 | 289 | |||||||||||||||||||
Total depreciation | $ | 3,437 | $ | 2,949 | $ | 6,689 | $ | 5,816 |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| |||||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
Stock-Based Compensation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||
Amortization: | Amortization: | ||||||||||||||||||||||||||||||||||||||
Platform operations |
| $ | 1,233 |
|
| $ | 3,142 |
|
| $ | 3,622 |
|
| $ | 11,843 |
| Platform operations | $ | — | $ | 175 | $ | 58 | $ | 350 | ||||||||||||||
Sales and marketing |
|
| 2,324 |
|
|
| 4,859 |
|
|
| 6,929 |
|
|
| 23,586 |
| Sales and marketing | — | — | — | — | ||||||||||||||||||
Technology and development |
|
| 1,430 |
|
|
| 3,015 |
|
|
| 4,024 |
|
|
| 10,983 |
| Technology and development | — | — | — | — | ||||||||||||||||||
General and administrative |
|
| 2,724 |
|
|
| 4,399 |
|
|
| 7,280 |
|
|
| 15,780 |
| General and administrative | 102 | 102 | 204 | 214 | ||||||||||||||||||
Total stock-based compensation |
| $ | 7,711 |
|
| $ | 15,415 |
|
| $ | 21,855 |
|
| $ | 62,192 |
| |||||||||||||||||||||||
Total amortization | Total amortization | $ | 102 | $ | 277 | $ | 262 | $ | 564 |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
Depreciation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
| $ | 2,510 |
|
| $ | 2,080 |
|
| $ | 7,219 |
|
| $ | 5,424 |
|
Sales and marketing |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Technology and development |
|
| 432 |
|
|
| 421 |
|
|
| 1,250 |
|
|
| 1,185 |
|
General and administrative |
|
| 147 |
|
|
| 164 |
|
|
| 436 |
|
|
| 494 |
|
Total depreciation |
| $ | 3,089 |
|
| $ | 2,665 |
|
| $ | 8,905 |
|
| $ | 7,103 |
|
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
Amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
| $ | 175 |
|
| $ | 175 |
|
| $ | 525 |
|
| $ | 525 |
|
Sales and marketing |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Technology and development |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
General and administrative |
|
| 102 |
|
|
| 132 |
|
|
| 316 |
|
|
| 396 |
|
Total amortization |
| $ | 277 |
|
| $ | 307 |
|
| $ | 841 |
|
| $ | 921 |
|
Comparison of the Three Months Ended SeptemberJune 30, 20222023 and 2021
2022
|
| Three Months Ended September 30, |
|
| Change |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| ||||
Revenue |
| $ | 48,830 |
|
| $ | 50,857 |
|
| $ | (2,027 | ) |
|
| (4 | )% |
Three Months Ended June 30, | Change | ||||||||||||||||||||||
2023 | 2022 | $ | % | ||||||||||||||||||||
Revenue | $ | 57,223 | $ | 51,200 | $ | 6,023 | 12 | % |
26
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
2022.
|
| Three Months Ended September 30, |
|
| Change |
| Three Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
Traffic acquisition costs |
| $ | 16,759 |
|
| $ | 16,780 |
|
| $ | (21 | ) |
|
| (0 | )% | Traffic acquisition costs | $ | 23,535 | $ | 19,465 | $ | 4,070 | 21 | % | ||||||||||||||
Other platform operations |
|
| 10,771 |
|
|
| 12,187 |
|
|
| (1,416 | ) |
|
| (12 | )% | Other platform operations | 9,988 | 11,485 | (1,497) | (13) | % | |||||||||||||||||
Total platform operations |
| $ | 27,530 |
|
| $ | 28,967 |
|
| $ | (1,437 | ) |
|
| (5 | )% | Total platform operations | $ | 33,523 | $ | 30,950 | $ | 2,573 | 8 | % | ||||||||||||||
Platform operations as a percentage of revenue |
|
| 56 | % |
|
| 57 | % |
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Percentage of revenue | Percentage of revenue | 59 | % | 60 | % |
|
| Three Months Ended September 30, |
|
| Change |
| Three Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
Sales and marketing |
| $ | 16,949 |
|
| $ | 15,131 |
|
| $ | 1,818 |
|
|
| 12 | % | Sales and marketing | $ | 11,691 | $ | 17,286 | $ | (5,595) | (32) | % | ||||||||||||||
Percentage of revenue |
|
| 35 | % |
|
| 30 | % |
|
|
|
|
|
|
|
| Percentage of revenue | 20 | % | 34 | % |
Three Months Ended June 30, | Change | ||||||||||||||||||||||
2023 | 2022 | $ | % | ||||||||||||||||||||
Technology and development | $ | 6,172 | $ | 5,011 | $ | 1,161 | 23 | % | |||||||||||||||
Percentage of revenue | 11 | % | 10 | % |
Three Months Ended June 30, | Change | ||||||||||||||||||||||
2023 | 2022 | $ | % | ||||||||||||||||||||
General and administrative | $ | 11,088 | $ | 11,725 | $ | (637) | (5) | % | |||||||||||||||
Percentage of revenue | 19 | % | 23 | % |
Technology and Development
|
| Three Months Ended September 30, |
|
| Change |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| ||||
Technology and development |
| $ | 5,576 |
|
| $ | 6,590 |
|
| $ | (1,014 | ) |
|
| (15 | )% |
Percentage of revenue |
|
| 11 | % |
|
| 13 | % |
|
|
|
|
|
|
|
|
Technology and development expense decreased by $1.0 million, or 15%, during the three months ended September 30, 2022 compared to the three months ended September 30, 2021. This decrease was primarily attributable to a $1.6 million decrease in stock-based compensation, which was partially offset by an increase of $0.3 million in cloud infrastructure costs, an increase of $0.2 million in personnel costs, and a $0.2 million increase in consulting expenses.
General and Administrative
|
| Three Months Ended September 30, |
|
| Change |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| ||||
General and administrative |
| $ | 11,650 |
|
| $ | 11,981 |
|
| $ | (331 | ) |
|
| (3 | )% |
Percentage of revenue |
|
| 24 | % |
|
| 24 | % |
|
|
|
|
|
|
|
|
27
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
General and administrative expense decreased by 0.3 million, or 3%, during the three months ended September 30, 2022 compared to the three months ended September 30, 2021. This decrease was primarily attributable toa $1.7 million decrease in stock-based compensation and a $0.4 million decrease in recruiting expenses, partially offset by a $0.7$0.8 million increase in bad debt reserves,stock-based compensation and a $0.5 million increase in travel and entertainment expenses, a $0.4$0.3 million increase in personnel costs due to increase in headcount, and a $0.1 million increase in consulting expenses associated with general corporate and compliance matters.
costs.
Three Months Ended June 30, | Change | ||||||||||||||||||||||||||||||||||||||
|
| Three Months Ended September 30, |
|
| Change |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| |||||||||||||||||||||||||||
Total other expense (income), net |
| $ | (449 | ) |
| $ | 348 |
|
| $ | (797 | ) |
|
| 229 | % | Total other expense (income), net | $ | (2,048) | $ | 320 | $ | (2,368) | (740) | % | ||||||||||||||
Percentage of revenue |
|
| -1 | % |
|
| 1 | % |
|
|
|
|
|
|
|
| Percentage of revenue | (4) | % | 1 | % |
in May 2022.
2022
|
| Nine Months Ended September 30, |
|
| Change |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| ||||
Revenue |
| $ | 142,659 |
|
| $ | 141,412 |
|
| $ | 1,247 |
|
|
| 1 | % |
Six Months Ended June 30, | Change | ||||||||||||||||||||||
2023 | 2022 | $ | % | ||||||||||||||||||||
Revenue | $ | 98,943 | $ | 93,829 | $ | 5,114 | 5 | % |
2022.
|
| Nine Months Ended September 30, |
|
| Change |
| Six Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
Traffic acquisition costs |
| $ | 51,309 |
|
| $ | 48,395 |
|
| $ | 2,914 |
|
|
| 6 | % | Traffic acquisition costs | $ | 37,264 | $ | 34,550 | $ | 2,714 | 8 | % | ||||||||||||||
Other platform operations |
|
| 33,365 |
|
|
| 36,631 |
|
|
| (3,266 | ) |
|
| (9 | )% | Other platform operations | 19,596 | 22,594 | (2,998) | (13) | % | |||||||||||||||||
Total platform operations |
| $ | 84,674 |
|
| $ | 85,026 |
|
| $ | (352 | ) |
|
| (0 | )% | Total platform operations | $ | 56,860 | $ | 57,144 | $ | (284) | — | % | ||||||||||||||
Platform operations as a percentage of revenue |
|
| 59 | % |
|
| 60 | % |
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Percentage of revenue | Percentage of revenue | 57 | % | 61 | % |
28
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
continued enhancements to our cloud infrastructure, a $1.8$0.9 million increase in depreciation and a $1.2 million increaserelated to our continued investment in third-party costs in support of our Adelphic platform.
developed technology.
|
| Nine Months Ended September 30, |
|
| Change |
| Six Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
Sales and marketing |
| $ | 47,991 |
|
| $ | 49,869 |
|
| $ | (1,878 | ) |
|
| (4 | )% | Sales and marketing | $ | 23,860 | $ | 31,042 | $ | (7,182) | (23) | % | ||||||||||||||
Percentage of revenue |
|
| 34 | % |
|
| 35 | % |
|
|
|
|
|
|
|
| Percentage of revenue | 24 | % | 33 | % |
expense.
|
| Nine Months Ended September 30, |
|
| Change |
| Six Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
Technology and development |
| $ | 15,590 |
|
| $ | 20,521 |
|
| $ | (4,931 | ) |
|
| (24 | )% | Technology and development | $ | 12,066 | $ | 10,014 | $ | 2,052 | 20 | % | ||||||||||||||
Percentage of revenue |
|
| 11 | % |
|
| 15 | % |
|
|
|
|
|
|
|
| Percentage of revenue | 12 | % | 11 | % |
stock-based compensation, which was partially offset by a $0.2 million decrease in professional services.
|
| Nine Months Ended September 30, |
|
| Change |
| Six Months Ended June 30, | Change | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||
General and administrative |
| $ | 34,458 |
|
| $ | 36,477 |
|
| $ | (2,019 | ) |
|
| (6 | )% | General and administrative | $ | 22,516 | $ | 22,808 | $ | (292) | (1) | % | ||||||||||||||
Percentage of revenue |
|
| 24 | % |
|
| 26 | % |
|
|
|
|
|
|
|
| Percentage of revenue | 23 | % | 24 | % |
Six Months Ended June 30, | Change | ||||||||||||||||||||||||||||||||||||||
|
| Nine Months Ended September 30, |
|
| Change |
| 2023 | 2022 | $ | % | |||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| $ |
|
| % |
| |||||||||||||||||||||||||||
Total other expense (income), net |
| $ | 27 |
|
| $ | (5,354 | ) |
| $ | 5,381 |
|
|
| 101 | % | Total other expense (income), net | $ | (3,780) | $ | 476 | $ | (4,256) | (894) | % | ||||||||||||||
Percentage of revenue |
|
| 0 | % |
|
| (4 | )% |
|
|
|
|
|
|
|
| Percentage of revenue | (4) | % | 1 | % |
29
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollarsrevolving credit facility with PNC Bank in thousands, except for percentages and per share data)
$0.7 million of interest expense in the prior year which was de minimis in the current year. For additional information regarding forgiveness of our PPP Loan, see Note 8—Revolving Credit Facility and PPP Loan to our condensed consolidated financial statements.
30
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
May 2022.
|
| Three Months Ended September 30, |
|
|
|
|
|
| Nine Months Ended September 30, |
|
|
|
|
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| Change (%) |
|
| 2022 |
|
| 2021 |
|
| Change (%) |
| ||||||
Operating and Financial Performance Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
| $ | 21,300 |
|
| $ | 21,890 |
|
|
| (3 | )% |
| $ | 57,985 |
|
| $ | 56,386 |
|
|
| 3 | % |
Contribution ex-TAC |
| $ | 32,071 |
|
| $ | 34,077 |
|
|
| (6 | )% |
| $ | 91,350 |
|
| $ | 93,017 |
|
|
| (2 | )% |
Net loss |
| $ | (12,426 | ) |
| $ | (12,160 | ) |
|
| (2 | )% |
| $ | (40,081 | ) |
| $ | (45,127 | ) |
|
| 11 | % |
Adjusted EBITDA |
| $ | (1,804 | ) |
| $ | 6,454 |
|
|
| (128 | )% |
| $ | (8,762 | ) |
| $ | 19,682 |
|
|
| (145 | )% |
Net loss as a percentage of gross profit |
|
| (58 | )% |
|
| (56 | )% |
|
| (5 | )% |
|
| (69 | )% |
|
| (80 | )% |
|
| 14 | % |
Adjusted EBITDA as a percentage of contribution ex-TAC |
|
| (6 | )% |
|
| 19 | % |
|
| (137 | )% |
|
| (10 | )% |
|
| 21 | % |
|
| (152 | )% |
Non-GAAP net income (loss) |
| $ | (4,434 | ) |
| $ | 3,092 |
|
|
| (243 | )% |
| $ | (17,154 | ) |
| $ | 10,476 |
|
|
| (264 | )% |
Total operating expenses |
| $ | 61,705 |
|
| $ | 62,669 |
|
|
| (2 | )% |
| $ | 182,713 |
|
| $ | 191,893 |
|
|
| (5 | )% |
Non-GAAP operating expenses |
| $ | 33,875 |
|
| $ | 27,623 |
|
|
| 23 | % |
| $ | 100,112 |
|
| $ | 73,335 |
|
|
| 37 | % |
Loss per share—basic |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
|
| (10 | )% |
| $ | (0.69 | ) |
| $ | (0.78 | ) |
|
| 12 | % |
Loss per share—diluted |
| $ | (0.22 | ) |
| $ | (0.20 | ) |
|
| (10 | )% |
| $ | (0.69 | ) |
| $ | (0.78 | ) |
|
| 12 | % |
Non-GAAP earnings (loss) per share—basic |
| $ | (0.06 | ) |
| $ | 0.04 |
|
|
| (250 | )% |
| $ | (0.24 | ) |
| $ | 0.12 |
|
|
| (300 | )% |
Non-GAAP earnings (loss) per share—diluted |
| $ | (0.06 | ) |
| $ | 0.04 |
|
|
| (250 | )% |
| $ | (0.24 | ) |
| $ | 0.12 |
|
|
| (300 | )% |
Active customers |
|
| 334 |
|
|
| 305 |
|
|
| 10 | % |
|
| 334 |
|
|
| 305 |
|
|
| 10 | % |
Average gross profit per active customer |
| $ | 288 |
|
| $ | 285 |
|
|
| 1 | % |
| $ | 288 |
|
| $ | 285 |
|
|
| 1 | % |
Average contribution ex-TAC per active customer |
| $ | 419 |
|
| $ | 433 |
|
|
| (3 | )% |
| $ | 419 |
|
| $ | 433 |
|
|
| (3 | )% |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2023 | 2022 | Change (%) | 2023 | 2022 | Change (%) | ||||||||||||||||||||||||||||||
Operating and Financial Performance Measures | |||||||||||||||||||||||||||||||||||
Gross profit | $ | 23,700 | $ | 20,250 | 17 | % | $ | 42,083 | $ | 36,685 | 15 | % | |||||||||||||||||||||||
Contribution ex-TAC | $ | 33,688 | $ | 31,735 | 6 | % | $ | 61,679 | $ | 59,279 | 4 | % | |||||||||||||||||||||||
Net loss | $ | (3,203) | $ | (14,092) | 77 | % | $ | (12,579) | $ | (27,655) | 55 | % | |||||||||||||||||||||||
Adjusted EBITDA | $ | 6,816 | $ | (3,077) | 322 | % | $ | 6,426 | $ | (6,958) | 192 | % | |||||||||||||||||||||||
Net loss as a percentage of gross profit | (14) | % | (70) | % | 80 | % | (30) | % | (75) | % | 60 | % | |||||||||||||||||||||||
Adjusted EBITDA as a percentage of contribution ex-TAC | 20 | % | (10) | % | 300 | % | 10 | % | (12) | % | 183 | % | |||||||||||||||||||||||
Non-GAAP net income (loss) | $ | 5,095 | $ | (5,934) | 186 | % | $ | 3,236 | $ | (12,702) | 125 | % | |||||||||||||||||||||||
Total operating expenses | $ | 62,474 | $ | 64,972 | (4) | % | $ | 115,302 | $ | 121,008 | (5) | % | |||||||||||||||||||||||
Non-GAAP operating expenses | $ | 26,872 | $ | 34,812 | (23) | % | $ | 55,253 | $ | 66,237 | (17) | % | |||||||||||||||||||||||
Earnings (loss) per share—basic | $ | (0.07) | $ | (0.24) | 71 | % | $ | (0.24) | $ | (0.47) | 49 | % | |||||||||||||||||||||||
Earnings (loss) per share—diluted | $ | (0.07) | $ | (0.24) | 71 | % | $ | (0.24) | $ | (0.47) | 49 | % | |||||||||||||||||||||||
Non-GAAP earnings (loss) per share—basic | $ | 0.06 | $ | (0.08) | 175 | % | $ | 0.03 | $ | (0.18) | 117�� | % | |||||||||||||||||||||||
Non-GAAP earnings (loss) per share—diluted | $ | 0.06 | $ | (0.08) | 175 | % | $ | 0.03 | $ | (0.18) | 117 | % | |||||||||||||||||||||||
Active customers | 314 | 336 | (7) | % | 314 | 336 | (7) | % | |||||||||||||||||||||||||||
31
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
which may make comparisons difficult. Because of these and other limitations, you should consider our non-GAAP financial measures only as supplemental to other GAAP-based financial performance measures, including revenue, gross profit, net income (loss) and cash flows. For a
three and six months ended June 30, 2023 and 2022:
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revenue | $ | 57,223 | $ | 51,200 | $ | 98,943 | $ | 93,829 | |||||||||||||||
Less: Platform operations | (33,523) | (30,950) | (56,860) | (57,144) | |||||||||||||||||||
Gross profit | 23,700 | 20,250 | 42,083 | 36,685 | |||||||||||||||||||
Add: Other platform operations | 9,988 | 11,485 | 19,596 | 22,594 | |||||||||||||||||||
Contribution ex-TAC | $ | 33,688 | $ | 31,735 | $ | 61,679 | $ | 59,279 |
Average contribution ex-TAC per count was 314, compared to 326 active customer
We define average contribution ex-TAC per active customer as contribution ex-TACcustomers for the trailing 12-month period presented divided by active customers. Average gross profit per active customertwelve months ended June 30, 2022.
thousands, except per share data)
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
Revenue |
| $ | 48,830 |
|
| $ | 50,857 |
|
| $ | 142,659 |
|
| $ | 141,412 |
|
Less: Platform operations |
|
| (27,530 | ) |
|
| (28,967 | ) |
|
| (84,674 | ) |
|
| (85,026 | ) |
Gross profit |
|
| 21,300 |
|
|
| 21,890 |
|
|
| 57,985 |
|
|
| 56,386 |
|
Add back: Other platform operations |
|
| 10,771 |
|
|
| 12,187 |
|
|
| 33,365 |
|
|
| 36,631 |
|
Contribution ex-TAC |
| $ | 32,071 |
|
| $ | 34,077 |
|
| $ | 91,350 |
|
| $ | 93,017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active customers |
|
| 334 |
|
|
| 305 |
|
|
| 334 |
|
|
| 305 |
|
Average gross profit per active customer |
| $ | 288 |
|
| $ | 285 |
|
| $ | 288 |
|
| $ | 285 |
|
Average contribution ex-TAC per active customer |
| $ | 419 |
|
| $ | 433 |
|
| $ | 419 |
|
| $ | 433 |
|
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Platform operations | $ | 33,523 | $ | 30,950 | $ | 56,860 | $ | 57,144 | |||||||||||||||
Sales and marketing | 11,691 | 17,286 | 23,860 | 31,042 | |||||||||||||||||||
Technology and development | 6,172 | 5,011 | 12,066 | 10,014 | |||||||||||||||||||
General and administrative | 11,088 | 11,725 | 22,516 | 22,808 | |||||||||||||||||||
Total operating expenses | 62,474 | 64,972 | 115,302 | 121,008 | |||||||||||||||||||
Add: | |||||||||||||||||||||||
Other expense, net | 1 | 299 | 88 | 303 | |||||||||||||||||||
Less: | |||||||||||||||||||||||
Traffic acquisition costs | (23,535) | (19,465) | (37,264) | (34,550) | |||||||||||||||||||
Stock-based compensation | (8,529) | (7,768) | (16,001) | (14,144) | |||||||||||||||||||
Depreciation and amortization | (3,539) | (3,226) | (6,951) | (6,380) | |||||||||||||||||||
Restructuring(1) | — | — | 79 | — | |||||||||||||||||||
Non-GAAP operating expenses | $ | 26,872 | $ | 34,812 | $ | 55,253 | $ | 66,237 |
32
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)
(unaudited; tabular dollars in thousands, except for percentages and per share data)
that adjusted EBITDA and adjusted EBITDA as a percentage of contribution ex-TAC provide information to investors and the market in understanding and evaluating our operating results in the same manner as our management and board of directors.
|
|
•other companies, including companies in our industry that have similar business arrangements, may report adjusted EBITDA or adjusted EBITDA as a percentage of contribution ex-TAC, or similarly titled measures, but calculate them differently, which reduces their usefulness as comparative measures; |
|
•although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; and |
|
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Net loss |
| $ | (12,426 | ) |
| $ | (12,160 | ) |
| $ | (40,081 | ) |
| $ | (45,127 | ) | Net loss | $ | (3,203) | $ | (14,092) | $ | (12,579) | $ | (27,655) | ||||||||||||||
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Add back: | ||||||||||||||||||||||
Interest expense (income), net |
|
| (455 | ) |
|
| 227 |
|
|
| (282 | ) |
|
| 703 |
| Interest expense (income), net | (2,049) | 21 | (3,868) | 173 | ||||||||||||||||||
Depreciation and amortization |
|
| 3,366 |
|
|
| 2,972 |
|
|
| 9,746 |
|
|
| 8,024 |
| Depreciation and amortization | 3,539 | 3,226 | 6,951 | 6,380 | ||||||||||||||||||
Stock-based compensation |
|
| 7,711 |
|
|
| 15,415 |
|
|
| 21,855 |
|
|
| 62,192 |
| Stock-based compensation | 8,529 | 7,768 | 16,001 | 14,144 | ||||||||||||||||||
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Gain on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (6,110 | ) | |||||||||||||||||||||||
Restructuring(1) | Restructuring(1) | — | — | (79) | — | ||||||||||||||||||||||||||||||||||
Adjusted EBITDA |
| $ | (1,804 | ) |
| $ | 6,454 |
|
| $ | (8,762 | ) |
| $ | 19,682 |
| Adjusted EBITDA | $ | 6,816 | $ | (3,077) | $ | 6,426 | $ | (6,958) |
|
| Three Months Ended September 30, |
|
| Nine Months Ended September 30, |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Gross profit |
| $ | 21,300 |
|
| $ | 21,890 |
|
| $ | 57,985 |
|
| $ | 56,386 |
| Gross profit | $ | 23,700 | $ | 20,250 | $ | 42,083 | $ | 36,685 | ||||||||||||||
Net loss |
| $ | (12,426 | ) |
| $ | (12,160 | ) |
| $ | (40,081 | ) |
| $ | (45,127 | ) | Net loss | $ | (3,203) | $ | (14,092) | $ | (12,579) | $ | (27,655) | ||||||||||||||
Net loss as a percentage of gross profit |
|
| (58 | )% |
|
| (56 | )% |
|
| (69 | )% |
|
| (80 | )% | Net loss as a percentage of gross profit | (14) | % | (70) | % | (30) | % | (75) | % | ||||||||||||||
Contribution ex-TAC(1) |
| $ | 32,071 |
|
| $ | 34,077 |
|
| $ | 91,350 |
|
| $ | 93,017 |
| Contribution ex-TAC(1) | $ | 33,688 | $ | 31,735 | $ | 61,679 | $ | 59,279 | ||||||||||||||
Adjusted EBITDA |
| $ | (1,804 | ) |
| $ | 6,454 |
|
| $ | (8,762 | ) |
| $ | 19,682 |
| Adjusted EBITDA | $ | 6,816 | $ | (3,077) | $ | 6,426 | $ | (6,958) | ||||||||||||||
Adjusted EBITDA as a percentage of contribution ex-TAC |
|
| (6 | )% |
|
| 19 | % |
|
| (10 | )% |
|
| 21 | % | Adjusted EBITDA as a percentage of contribution ex-TAC | 20 | % | (10) | % | 10 | % | (12) | % |
Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net loss $ (12,426 ) $ (12,160 ) $ (40,081 ) $ (45,127 ) Add back: Stock-based compensation 7,711 15,415 21,855 62,192 Less: Gain on extinguishment of debt — — — (6,110 ) Income tax benefit (expense) related to Viant Technology Inc.’s share of adjustments(1) 281 (163 ) 1,072 (479 ) Non-GAAP net income (loss) $ (4,434 ) $ 3,092 $ (17,154 ) $ 10,476 •other companies, including companies in our industry that have similar business arrangements, may report non-GAAP earnings (loss) per share of Class A common stock—basic and diluted or similarly titled measures, but calculate them differently, which reduces their usefulness as comparative measures; and Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Earnings (Loss) per Share Adjustments Non-GAAP Earnings (Loss) per Share Earnings (Loss) per Share Adjustments Non-GAAP Earnings (Loss) per Share Numerator Net loss $ (12,426 ) $ — $ (12,426 ) $ (12,160 ) $ — $ (12,160 ) Adjustments: Add back: Stock-based compensation — 7,711 7,711 — 15,415 15,415 Income tax benefit (expense) related to Viant Technology Inc.'s share of adjustments(1) — 281 281 — (163 ) (163 ) Non-GAAP net income (loss) (12,426 ) 7,992 (4,434 ) (12,160 ) 15,252 3,092 Less: Net income (loss) attributable to noncontrolling interests(2) (9,300 ) 5,752 (3,548 ) (9,623 ) 12,211 2,588 Net income (loss) attributable to Viant Technology Inc.—basic (3,126 ) 2,240 (886 ) (2,537 ) 3,041 504 Add back: Reallocation of net loss attributable to noncontrolling interest from the assumed exchange of RSUs for Class A common stock — — — — 1 1 Income tax benefit (expense) from the assumed exchange of RSUs for Class A common stock(1) — — — — — — Net income (loss) attributable to Viant Technology Inc.—diluted $ (3,126 ) $ 2,240 $ (886 ) $ (2,537 ) $ 3,042 $ 505 Denominator Weighted-average shares of Class A common stock outstanding—basic 14,306 — 14,306 12,489 — 12,489 Effect of dilutive securities: Restricted stock units — — — — 734 734 Nonqualified stock options — — — — — — Weighted-average shares of Class A common stock outstanding—diluted 14,306 — 14,306 12,489 734 13,223 Earnings (loss) per share of Class A common stock—basic $ (0.22 ) $ 0.16 $ (0.06 ) $ (0.20 ) $ 0.24 $ 0.04 Earnings (loss) per share of Class A common stock—diluted $ (0.22 ) $ 0.16 $ (0.06 ) $ (0.20 ) $ 0.24 $ 0.04 Anti-dilutive shares excluded from earnings (loss) per share of Class A common stock—diluted: Restricted stock units 4,421 — Nonqualified stock options 3,902 147 Shares of Class B common stock 47,082 47,137 Total shares excluded from earnings (loss) per share of Class A common stock—diluted 55,405 47,284 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Earnings (Loss) per Share Adjustments Non-GAAP Earnings (Loss) per Share Earnings (Loss) per Share Adjustments Non-GAAP Earnings (Loss) per Share Numerator Net loss $ (40,081 ) $ — $ (40,081 ) $ (45,127 ) $ — $ (45,127 ) Adjustments: Add back: Stock-based compensation — 21,855 21,855 — 62,192 62,192 Less: Gain on extinguishment of debt — — — — (6,110 ) (6,110 ) Income tax benefit (expense) related to Viant Technology Inc.'s share of adjustments — 1,072 1,072 — (479 ) (479 ) Non-GAAP net income (loss) (40,081 ) 22,927 (17,154 ) (45,127 ) 55,603 10,476 Less: Net income (loss) attributable to noncontrolling interests (30,362 ) 16,590 (13,772 ) (35,829 ) 44,825 8,996 Net income (loss) attributable to Viant Technology Inc.—basic (9,719 ) 6,337 (3,382 ) (9,298 ) 10,778 1,480 Add back: Reallocation of net loss attributable to noncontrolling interest from the assumed exchange of RSUs for Class A common stock — — — — 251 251 Income tax benefit (expense) from the assumed exchange of RSUs for Class A common stock — — — — (61 ) (61 ) Net income (loss) attributable to Viant Technology Inc.—diluted $ (9,719 ) $ 6,337 $ (3,382 ) $ (9,298 ) $ 10,968 $ 1,670 Denominator Weighted-average shares of Class A common stock outstanding—basic 14,078 — 14,078 11,894 — 11,894 Effect of dilutive securities: Restricted stock units — — — — 1,959 1,959 Nonqualified stock options — — — — — — Weighted-average shares of Class A common stock outstanding—diluted 14,078 — 14,078 11,894 1,959 13,853 Earnings (loss) per share of Class A common stock—basic $ (0.69 ) $ 0.45 $ (0.24 ) $ (0.78 ) $ 0.90 $ 0.12 Earnings (loss) per share of Class A common stock—diluted $ (0.69 ) $ 0.45 $ (0.24 ) $ (0.78 ) $ 0.90 $ 0.12 Anti-dilutive shares excluded from earnings (loss) per share of Class A common stock—diluted: Restricted stock units 4,421 — Nonqualified stock options 3,902 147 Shares of Class B common stock 47,082 47,137 Total shares excluded from earnings (loss) per share of Class A common stock—diluted 55,405 47,284 Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating expenses: Platform operations $ 27,530 $ 28,967 $ 84,674 $ 85,026 Sales and marketing 16,949 15,131 47,991 49,869 Technology and development 5,576 6,590 15,590 20,521 General and administrative 11,650 11,981 34,458 36,477 Total operating expenses 61,705 62,669 182,713 191,893 Add: Other expense, net 6 121 309 53 Less: Traffic acquisition costs (16,759 ) (16,780 ) (51,309 ) (48,395 ) Stock-based compensation (7,711 ) (15,415 ) (21,855 ) (62,192 ) Depreciation and amortization (3,366 ) (2,972 ) (9,746 ) (8,024 ) Non-GAAP operating expenses $ 33,875 $ 27,623 $ 100,112 $ 73,335 Liquidity and Capital Resources 2022. equity. $0.8 million in 2026. this Quarterly Report. Report. Nine Months Ended September 30, 2022 2021 Consolidated Statements of Cash Flows Data Cash flows provided by (used in) operating activities $ (13,314 ) $ 30,085 Cash flows used in investing activities (6,425 ) (5,963 ) Cash flows provided by (used in) financing activities (19,076 ) 208,859 Increase (decrease) in cash and cash equivalents $ (38,815 ) $ 232,981 During the •$6.1 million of investments in capitalized software to develop our technology in support of enhancing our platform; and During the six months ended June 30, 2022, cash flows used in financing activities of $18.4 million resulted primarily from the $17.5 million repayment of our revolving credit facility and $0.9 million of taxes paid related to the net share settlement of equity awards. Operations.” 2022. 2026. We will cease to be an EGC upon the earliest of: (i) until December 31, 2026, (ii) the first fiscal year after our annual gross revenue is $1.235 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in nonconvertible debt securities or (iv) the end of any fiscal year in which the market value of our Class A common stock held by non-affiliates exceeded $700.0 million as of the end of the second quarter of that fiscal year. Period Total Number of Shares Purchased (1) Average Price Paid Per Share (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs 7/1/22 to 7/31/22 — — — — 8/1/22 to 8/31/22 — — — — 9/1/22 to 9/30/22 144,173 4.86 — — Total 144,173 $ 4.86 $ — $ — Item 3. Defaults Upon Senior Securities Item 6. Exhibits 3.2 10.1 31.2* 32.1*† 32.2*† 101.INS Inline XBRL Instance Document 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) Date: /s/ Tim Vanderhook Tim Vanderhook Chief Executive Officer and Chairman Date: /s/ Larry Madden Larry Madden Chief Financial OfficerAverage contributionContribution ex-TAC per active customer.”33MANAGEMENT’S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)(unaudited; tabular dollars in thousands, except for percentages and per share data)gain on debt extinguishment, and certain other items that are not related to our core operations provides measures for period-to-period comparisons of our business and additional insight into our core controllable costs. Accordingly, we believe that non-GAAP net income (loss) provides information to investors and the market generally in understanding and evaluating our results of operations in the same manner as our management and board of directors.ninesix months ended SeptemberJune 30,, 2022 2023 and 2021:2022:Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net loss $ (3,203) $ (14,092) $ (12,579) $ (27,655) Add back: Stock-based compensation 8,529 7,768 16,001 14,144 — — (79) — (231) 390 (107) 809 Non-GAAP net income (loss) $ 5,095 $ (5,934) $ 3,236 $ (12,702) an assumed blended tax raterates of 24%20% and 25%, respectively, which representsrepresent our expected corporate tax rate,rates, excluding discrete and non-recurring tax items.34MANAGEMENT’S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)(unaudited; tabular dollars in thousands, except for percentages and per share data)•other companies, including companies in our industry that have similar business arrangements, may report non-GAAP earnings (loss) per share of Class A common stock—basic and diluted or similarly titled measures, but calculate them differently, which reduces their usefulness as comparative measures; and•although the stock-based compensation related to the LTIP referred to above is non-cash in nature, non-GAAP earnings (loss) per share of Class A common stock—basic and diluted does not reflect its impact on net income (loss) attributable to all common stockholders.ninesix months ended SeptemberJune 30, 2023 and 2022, Class B common stock, RSUs, – (continued)for percentages and per share data)ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:Three Months Ended
June 30, 2023Three Months Ended
June 30, 2022Earnings
(Loss) per
ShareAdjustments Non-GAAP
Earnings (Loss)
per ShareEarnings
(Loss) per
ShareAdjustments Non-GAAP
Earnings (Loss)
per ShareNumerator Net loss $ (3,203) $ — $ (3,203) $ (14,092) $ — $ (14,092) Adjustments: Add back: Stock-based compensation — 8,529 8,529 — 7,768 7,768 — (231) (231) — 390 390 Non-GAAP net income (loss) (3,203) 8,298 5,095 (14,092) 8,158 (5,934) (2,140) 6,341 4,201 (10,691) 5,952 (4,739) Net income (loss) attributable to Viant Technology Inc.—basic (1,063) 1,957 894 (3,401) 2,206 (1,195) Add back: Reallocation of net loss attributable to noncontrolling interest from the assumed exchange of RSUs for Class A common stock — 17 17 — — — Income tax benefit (expense) from the assumed exchange of RSUs for Class A common stock — (3) (3) — — — Net income (loss) attributable to Viant Technology Inc.—diluted $ (1,063) $ 1,971 $ 908 $ (3,401) $ 2,206 $ (1,195) Denominator Weighted-average shares of Class A common stock outstanding —basic 15,135 15,135 14,114 14,114 Effect of dilutive securities: Restricted stock units — 220 — — Weighted-average shares of Class A common stock outstanding —diluted 15,135 15,355 14,114 14,114 Earnings (loss) per share of Class A common stock—basic $ (0.07) $ 0.13 $ 0.06 $ (0.24) $ 0.16 $ (0.08) Earnings (loss) per share of Class A common stock—diluted $ (0.07) $ 0.13 $ 0.06 $ (0.24) $ 0.16 $ (0.08) Anti-dilutive shares excluded from earnings (loss) per share of Class A common stock—diluted: Restricted stock units 4,240 — 4,781 4,781 Nonqualified stock options 5,763 5,763 3,898 3,898 Shares of Class B common stock 47,082 47,082 47,082 47,082 Total shares excluded from earnings (loss) per share of Class A common stock—diluted 57,085 52,845 55,761 55,761 (1)The estimated income tax effect of our share of non-GAAP reconciling items for the three months ended June 30, 2023 and 2022 are calculated using an assumed blended tax raterates of 24%20% and 25%, respectively, which representsrepresent our expected corporate tax rate,rates, excluding discrete and non-recurring tax items.interest of our companyinterests outstanding during the period. – (continued)for percentages and per share data)Six Months Ended
June 30, 2023Six Months Ended
June 30, 2022Earnings
(Loss) per
ShareAdjustments Non-GAAP
Earnings (Loss)
per ShareEarnings
(Loss) per
ShareAdjustments Non-GAAP
Earnings (Loss)
per ShareNumerator Net loss $ (12,579) $ — $ (12,579) $ (27,655) $ — $ (27,655) Adjustments: Add back: Stock-based compensation — 16,001 16,001 — 14,144 14,144 — ` (79) (79) — — — (1)(2)— (107) (107) — 809 809 Non-GAAP net income (loss) (12,579) 15,815 3,236 (27,655) 14,953 (12,702) (2)(3)(9,036) 11,858 2,822 (21,062) 10,838 (10,224) Net income (loss) attributable to Viant Technology Inc.—basic (3,543) 3,957 414 (6,593) 4,115 (2,478) Add back: Reallocation of net loss attributable to noncontrolling interest from the assumed exchange of RSUs for Class A common stock — 16 16 — — — (1)— (3) (3) — — — Net income (loss) attributable to Viant Technology Inc.—diluted $ (3,543) $ 3,970 $ 427 $ (6,593) $ 4,115 $ (2,478) Denominator Weighted-average shares of Class A common stock outstanding —basic Weighted-average shares of Class A common stock outstanding —basic 14,943 14,943 13,962 13,962 Effect of dilutive securities: Restricted stock units — 136 — — Weighted-average shares of Class A common stock outstanding —diluted Weighted-average shares of Class A common stock outstanding —diluted 14,943 15,079 13,962 13,962 Earnings (loss) per share of Class A common stock—basic $ (0.24) $ 0.27 $ 0.03 $ (0.47) $ 0.29 $ (0.18) Earnings (loss) per share of Class A common stock—diluted $ (0.24) $ 0.27 $ 0.03 $ (0.47) $ 0.29 $ (0.18) Anti-dilutive shares excluded from earnings (loss) per share of Class A common stock—diluted: Restricted stock units 4,240 — 4,781 4,781 Nonqualified stock options 5,763 5,763 3,898 3,898 Shares of Class B common stock 47,082 47,082 47,082 47,082 Total shares excluded from earnings (loss) per share of Class A common stock—diluted 57,085 52,845 55,761 55,761 an assumed blended tax raterates of 24%20% and 25%, respectively, which representsrepresent our expected corporate tax rate,rates, excluding discrete and non-recurring tax items.(2)gain on extinguishment of debtrestructuring charges attributed to the noncontrolling interest of our companyinterests outstanding during the period. – (continued)for percentages and per share data)Non-GAAP Operating ExpensesNon-GAAP operating expenses is a non-GAAP financial measure. Total operating expenses is the most comparable GAAP financial measure. Non-GAAP operating expenses is defined by us as total operating expenses plus other expense (income), net less TAC, stock-based compensation, depreciation, amortization, and certain other items that are not related to our core operations, such as restructuring charges, and transaction expenses. Non-GAAP operating expenses is a key component in calculating adjusted EBITDA, which is one of the measures we use to provide our quarterly and annual business outlook to the investment community. Additionally, non-GAAP operating expenses is used by our management and board of directors to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. We believe that the elimination of depreciation, amortization, stock-based compensation, TAC and certain other items not related to our core operations provides another measure for period-to-period comparisons of our business, provides additional insight into our discretionary costs and is a useful metric for investors because it allows them to evaluate our operational performance in the same manner as our management and board of directors.Our use of non-GAAP operating expenses has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. A potential limitation of this non-GAAP financial measure is that other companies, including companies in our industry that have similar business arrangements, may define non-GAAP operating expenses differently, which may make comparisons difficult. Because of these and other limitations, you should consider our non-GAAP financial measures only as supplemental to other GAAP-based financial performance measures, including revenue, gross profit, net income (loss) and cash flows.The following table presents a reconciliation of total operating expenses to non-GAAP operating expenses for the three and nine months ended September 30, 2022 and 2021:SeptemberJune 30, 2022,2023, we had cash and cash equivalents of $199.7$203.9 million and working capital, consisting of current assets less current liabilities, of $228.6$224.0 million, compared to cash and cash equivalents of $238.5$206.6 million and working capital of $269.1$227.7 million as of December 31, 2021.“Loan“Amended Loan Agreement”) we entered intohave with PNC Bank on October 31, 2019(which was amended in April 2023), obtaining debt financing from other sources, or raising additional funds by issuing equity.softwaretechnology in support of enhancing our technology platform; purchases of property and equipment in support of our expanding headcount as a result of our growth; the payment of debt obligations used to finance our operations, capital expenditures, platform development and rapid growth; and future minimum payments under our non-cancelable operating leases. We intend to continue investing in critical areas of our business in 20222023 to further accelerate demand for our product and growth across the platform.38MANAGEMENT’S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)(unaudited; tabular dollarsthousands, except2024, $4.3 million in 2025, $4.3 million in 2026, and $4.2 million in 2027, and non-cancelable contractual agreements related to the hosting of our data storage processing, storage, and other computing services, which we estimate will be approximately $6.0 million for percentagesthe remainder of 2023, $6.4 million in 2024, $5.1 million in 2025, and per share data)statements.statements included elsewhere in this Quarterly Report. As of SeptemberJune 30, 2022,2023, we concluded that it was more likely than not that our deferred tax assets subject to the Tax Receivable Agreement would not be realized. Therefore, we currently do not expect to make payments under our Tax Receivable Agreement based on our estimates of future taxable income. As of SeptemberJune 30, 2022,2023, the total unrecorded liability for our Tax Receivable Agreement is approximately $10.3 million.our Annual Report on Form 10-K for the year ended December 31, 2021.As of September 30, 2022, our material cash requirements from known contractual obligations consisted of future minimum payments under our non-cancelable operating leases, which we estimate will be approximately $0.8million for the remainder of 2022, $4.5 million in 2023, $4.3 million in 2024, $4.3 million in 2025 and $4.3 million in 2026.SeptemberJune 30, 20222023 other than the minimum payments under the operating leases, hosting arrangements, and the indemnification agreements described in Note 13—Commitments and Contingencies to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.Ourprovidesprovided us with access to a $40.0$75.0 million senior secured revolving credit facility through October 31, 2024 andwith a maturity date of April 4, 2028 that is collateralized by security interests in substantially all of our assets.assets. As of SeptemberJune 30, 2023, there was no outstanding balance and up to $74.1 million of undrawn availability under the Amended Loan Agreement. As of December 31, 2022, there was no outstanding balance and up to $40.0$39.6 million of undrawn availability under the Loan Agreement. As of December 31, 2021, we had a balance of $17.5 million of outstanding borrowings and up to $22.5 million of undrawn availability under the Loan Agreement.not to exceedmaintain a maximum leverageminimum fixed charge coverage ratio at any time ourof 1.40 to 1 when undrawn availability under the Amended Loan Agreement is less than 25%. As of SeptemberJune 30, 2022,2023, we were in compliance with this covenant, and we do not believe this covenant or any other provision in the Amended Loan Agreement will materially impact our liquidity or otherwise restrict our ability to execute on our business plan during or beyond the next 12 months.referrefer to Note 8—Revolving Credit Facility and PPP Loan to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q..ninesix months ended SeptemberJune 30, 20222023 and 2021:2022:Six Months Ended
June 30,2023 2022 Consolidated Statements of Cash Flows Data Cash flows provided by (used in) operating activities $ 10,855 $ (8,519) Cash flows used in investing activities (6,462) (4,338) Cash flows used in financing activities Cash flows used in financing activities (7,065) (18,375) Net decrease in cash and cash equivalents Net decrease in cash and cash equivalents $ (2,672) $ (31,232) 39MANAGEMENT’S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)(unaudited; tabular dollars in thousands, except for percentages and per share data)In)in) Operating Activitiesninesix months ended SeptemberJune 30, 2022 was $13.3 million, a net decrease of $43.4 million, or 144%, from cash$8.5 million. Cash flows provided by operating activities for the ninesix months ended SeptemberJune 30, 20212023 resulted primarily from:$30.1$12.6 million from net loss; The change in cash flows for the period were primarily due to:•a decrease of $40.1 million from net loss;•an increase of $34.8 million due to non-cash add back adjustments to net loss primarily comprised of $21.9 million for stock-based compensation, $9.7 million for depreciation and amortization, and $2.0 million of amortization of operating lease assets;•an increase of $0.3 million from changes in working capital (excluding deferred revenue, other liabilities, and operating lease liabilities), including a net increase of $13.3 million in accounts receivable, prepaid assets and other assets primarily related to lower sales and timing of customer collections due to seasonal fluctuations, partially offset by a decrease of $13.0 million in accounts payable, accrued liabilities and accrued compensation primarily related to timing of payments;•a decrease in deferred revenue of $6.5 million primarily related to a modification agreement with a customer whereby we paid a sum to the customer in exchange for the full, final and immediate termination of certain deferred revenue liabilities;•a decrease in operating lease liabilities of $1.0 million; and•a decrease in other liabilities of $0.9 million.ninesix months ended SeptemberJune 30, 2021,2022, cash provided byused in operating activities of $30.1$8.5 million resulted primarily from a net loss of $45.1$27.7 million offset by non-cash add back adjustments to net loss of $62.2$14.1 million for stock-based compensation, $8.0$6.4 million for depreciation and amortization, $0.2$1.3 million in recovery of doubtful accounts, gain on debt extinguishmentamortization of $6.1 millionoperating lease assets, and an increase in net working capital (excluding deferred revenue, operating lease liabilities, and other liabilities) of $12.6$5.5 million, offset by a decrease in deferred revenue of $1.4$6.5 million, and a decrease in other liabilities of $0.1$1.1 million, and a decrease in operating lease liabilities of $1.0 million.softwaretechnology in support of enhancing our technology platform and purchases of property and equipment in support of our expanding headcount as a result of our growth. We capitalize certain costs associated with creating andsoftwareplatform development projects. Purchases of property and equipment and capitalized software development costs may vary from period-to-period due to the timing of the expansion of our operations, the addition or reduction of headcount and our softwareplatform development cycles. As a result of capitalization of stock-based compensation in future periods and the growth of our business, we expect our capital expenditures and our investment activity to continue to increase.ninesix months ended SeptemberJune 30, 20222023 was $6.4$6.5 million, a net increase of $0.5$2.1 million, or 7.7%49%, from cash flows used in investing activities for ninesix months ended SeptemberJune 30, 20212022 of $6.0$4.3 million. The change in cash flows for the ninesix months ended SeptemberJune 30, 2022 were2023 was primarily due to:•$5.9 million of investments in capitalized software to develop our software in support of enhancing our technology platform; and•$0.6 million of purchases of property and equipment.ninesix months ended SeptemberJune 30, 2021,2022, cash used in investing activities of $6.0$4.3 million resulted primarily from investments in capitalized software development costs.40MANAGEMENT’S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)(unaudited; tabular dollars in thousands, except for percentages and per share data)Provided by (Used In)Used In Financing Activitiesdistributions.distributions in accordance with their assumed tax liabilities. Net cash provided by or used in financing activities has been and will be used to finance our operations, capital expenditures, platform development and rapidour growth.ninesix months ended SeptemberJune 30, 20222023 was $19.1$7.1 million, a net decreasewhich consisted of $227.9 million from cash flows provided by financing activitiespayments for the nine months ended September 30, 2021 of $208.9 million. The decrease in cash flows for the nine months ended September 30, 2022 compared to the prior period in 2021 is primarily a result of the $232.5 million of proceeds from our IPO that closed in February 2021, net of underwriting discounts and commissions and the $17.5 million repayment of our revolving credit facility during the nine months ended September 30, 2022.During the nine months ended September 30, 2021, cash provided by financing activities of $208.9 million resulted primarily from $232.5 million of IPO proceeds, net of underwriting discounts and commissions, partially offset by payments of $2.6 million in related offering costs, $7.3 million in payments of member tax distributions and $13.7 million in taxes paid related to the net share settlement of equity awards.and internal use software, and the assumptions used in the calculation of our expected loss rate used to determine our credit loss reserve have the greatest potential impact on our condensed consolidated financial statements. Therefore, we consider these to be our critical accounting policies and estimates.Theresignificantmaterial changes in our critical accounting policies and estimates during the nine months ended September 30, 2022, as compared to the critical accounting policies and estimates disclosed in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2021.ninesix months ended SeptemberJune 30, 2022,2023, there have been no material changes in our exposure to market risk. For a discussion of our exposure to market risk, see Part II, Item 7A “Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.Report on Form 10-Q.Report. Based on such evaluation, our chief executive officer and chief financial officer have concluded that as of the end of the period covered by this Quarterly Report, on Form 10-Q, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.Ourreputation,prospects, financial condition, results of operations and cash flow, in which case, the trading price of our Class A common stock could decline and you could lose all or partof your investment.canat the time of the exchange; the timing of future exchanges; the extent to which exchanges are taxable; the amount and timing of the utilization of tax attributes; the amount, timing and character of Viant Technology Inc.’s income; the U.S. federal, state and local tax rates then applicable; the amount of each exchanging unitholder’s tax basis in its units at the time of the relevant exchange; the depreciation and amortization periods that apply to the increases in tax basis; the timing and amount of any earlier payments that Viant Technology Inc. may have made under the Tax Receivable Agreement and the portion of Viant Technology Inc.’s payments under the Tax Receivable Agreement that constitute imputed interest or give rise to depreciable or amortizable tax basis. We expect that, as a result of the increases in the tax basis of the tangible and intangible assets of Viant Technology LLC attributable to the exchanged Viant Technology LLC interests, and certain other tax benefits, the payments that Viant Technology Inc. will be affectedrequired to make to the holders of rights under the Tax Receivable Agreement will be substantial. There may be a material negative effect on our financial condition and liquidity if, as described below, the payments under the Tax Receivable Agreement exceed the actual benefits Viant Technology Inc. receives in respect of the tax attributes subject to the Tax Receivable Agreement and/or distributions to Viant Technology Inc. by Viant Technology LLC are not sufficient to permit Viant Technology Inc. to make payments under the Tax Receivable Agreement.factors, whether currently knownyears following commencement of any challenge, and Viant Technology Inc. will not be permitted to reduce its payments under the Tax Receivable Agreement until there has been a final and binding determination, by which time sufficient subsequent payments under the Tax Receivable Agreement may not be available to offset prior payments for disallowed benefits. Viant Technology Inc. will not be reimbursed for any payments previously made under the Tax Receivable Agreement if the basis increases described above are successfully challenged by the IRS or unknown,another taxing authority. As a result, in certain circumstances, payments could be made under the Tax Receivable Agreement that are significantly in excess of the benefit that Viant Technology Inc. actually realizes in respect of the increases in tax basis (and utilization of certain other tax benefits) and Viant Technology Inc. may not be able to recoup those payments, which could adversely affect Viant Technology Inc.’s financial condition and liquidity.those describedViant Technology Inc. Pursuant to the Viant Technology LLC Operating Agreement, Viant Technology LLC makes tax distributions to its members, including Viant Technology Inc., which generally are pro rata based on the ownership of Viant Technology LLC units, calculated using an assumed tax rate, to help each of the members to pay taxes on that member’s allocable share of Viant Technology LLC’s net taxable income. Under applicable tax rules, Viant Technology LLC is required to allocate net taxable income disproportionately to its members in Part I, Item 1A. “Risk Factors”certain circumstances. Because tax distributions are determined based on the member who is allocated the largest amount of taxable income on a per unit basis and on an assumed tax rate that is the highest possible rate applicable to any member, but are made pro rata based on ownership of Viant Technology LLC units, Viant Technology LLC is required to make tax distributions that, in the aggregate, likely exceed the aggregate amount of taxes payable by its members with respect to the allocation of Viant Technology LLC income.Annual Reporttax liabilities and obligations to make payments under the Tax Receivable Agreement. We may choose to manage these excess distributions through a number of different approaches, including by applying them to general corporate purposes.Form 10-K foran established securities market or readily tradable on a secondary market or the year ended December 31, 2021. When any onesubstantial equivalent thereof. Under certain circumstances, exchanges of Viant Technology LLC units pursuant to the Viant Technology LLC Operating Agreement or moreother transfers of these risks materialize fromViant Technology LLC units could cause Viant Technology LLC to be treated like a publicly traded partnership. From time to time the U.S. Congress has considered legislation to change the tax treatment of partnerships and there can be no assurance that any such legislation will not be enacted or if enacted will not be adverse to us.business, reputation,operating results, which could make our future operating results difficult to predict or cause our operating results to fall below securities analysts’ and investors’ expectations.operationsfactors, many of which are beyond our control. In particular, we offer our customers a choice of two different pricing options: a percentage of spend option and financial condition,a fixed CPM pricing option. We also offer our customers the ability to use our services to aid them in data management, media execution and advanced reporting. Our revenue and contribution ex-TAC vary across these different pricing and service options, and therefore our results may vary based on the mix of pricing and service options chosen by customers in any given period. The varying nature of our pricing mix between periods may make it more difficult for us to forecast our future operating results. Further, variation in our pricing mix may make it more difficult to make comparisons between prior, current and future periods. Period-to-period comparisons of our operating results should not be relied upon as well asan indication of our future performance. Fluctuations in our operating results could cause our performance to fall below the expectations of securities analysts and investors, and adversely affect the price of our Class A common stock, canstock. Because our business is changing and evolving rapidly, and the macroeconomic and geopolitical environment continues to evolve as a result of the COVID-19 pandemic, bank failures, labor shortages, inflation and monetary supply shifts, rising interest rates, tightening of credit markets, and potential disruptions from the ongoing Russia-Ukraine conflict, our historical operating results may not be materially and adversely affected. There have been no material necessarily indicative of our future operating results. In addition to changes in terms of mix of our different pricing options, factors that may cause our operating results to fluctuate include the following:fromlisted in this section and others beyond our control. Further, stock markets may experience extreme price and volume fluctuations that can affect the market prices of equity securities. These fluctuations can be unrelated or disproportionate to the operating performance of those disclosedcompanies. For instance, if the stock market for technology companies, or the stock market generally, experiences a loss of investor confidence, the trading price of our Class A common stock could decline for reasons unrelated to our business, operating results or financial condition. The trading price of our Class A common stock might also decline in reaction to events that affect other companies in our Annual Reportindustry even if these events do not directly affect us. In the past, stockholders have filed securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business, and adversely affect our business.Form 10-Kexemptions from certain corporate governance requirements.year endedforeseeable future. These stockholders will be able to influence or control matters requiring approval by our stockholders, including the election of directors and the approval of mergers, acquisitions or other extraordinary transactions. Their interests may differ from yours and they may vote in a manner that is adverse to your interests. This control may deter, delay or prevent a change of control of our company, deprive our stockholders of an opportunity to receive a premium for their Class A common stock as part of a sale of our company and may ultimately affect the market price of our Class A common stock.2021.Use of Proceeds from our Initial Public OfferingOn February 12, 2021, we completed our IPO, pursuant to which we issued and sold an aggregate of 11,500,000 shares of our Class A common stock (inclusive of 1,500,000 shares pursuant to the underwriters’ option to purchase additional shares) at the IPO price of $25.00 per share. The offer and sale of the shares of Class A common stock in the IPO were registered pursuant to registration statements on Form S-1 (File Nos. 333-252117 and 333-252907), which became effective on February 9, 2021.There has been no material change in the intended use of proceeds from our IPO as described in our final prospectus, dated February 9, 2021 and filed with the SEC pursuant to Rule 424(b)(4) on February 11, 2021.Under the LTIP, we are permitted to satisfy national, state, local or other tax withholding obligation due upon the vesting of an award granted under the LTIP by repurchasing an amount of shares otherwise deliverable on the vesting date having a fair market value equal to the withholding obligation. All of the shares repurchased by us during the third quarter of 2022 were in connection with this tax withholding obligation. During the three months ended September 30, 2022, we repurchased the following shares of our Class A common stock:stock during the quarter ended June 30, 2023.(1)Represents the shares of Class A common stock we repurchased upon the vesting of restricted stock units to satisfy the applicable tax withholding obligations incidental to the vesting of such awards.(2)Represents the average price per share that we paid for the repurchases described above.ExhibitNumberDescriptionExhibit
NumberDescription 3.1 31.1* ††*Filed herewith.
______________________†The certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.
* Filed herewith.VIANT TECHNOLOGY INC. November 9, 2022By: By:
(Principal Executive Officer)November 9, 2022By: By:
(Principal Financial and Accounting Officer)46