Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 05, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | AutoWeb, Inc. | |
Entity Central Index Key | 1,023,364 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding | 12,948,950 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Trading Symbol | AUTO |
CONSOLIDATED CONDENSED BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 15,824 | $ 24,993 |
Short-term investment | 257 | 254 |
Accounts receivable, net of allowances for bad debts and customer credits of $615 and $892 at September 30, 2018 and December 31, 2017, respectively | 25,267 | 25,911 |
Prepaid expenses and other current assets | 1,268 | 1,805 |
Total current assets | 42,616 | 52,963 |
Property and equipment, net | 3,614 | 4,311 |
Investments | 0 | 100 |
Intangible assets, net | 13,487 | 29,113 |
Goodwill | 0 | 5,133 |
Long-term deferred tax asset | 0 | 692 |
Other assets | 853 | 601 |
Total assets | 60,570 | 92,913 |
Current liabilities: | ||
Accounts payable | 10,386 | 7,083 |
Accrued employee-related benefits | 2,921 | 2,411 |
Other accrued expenses and other current liabilities | 7,983 | 7,252 |
Convertible note payable | 1,000 | 0 |
Total current liabilities | 22,290 | 16,746 |
Convertible note payable | 0 | 1,000 |
Borrowings under revolving credit facility | 0 | 8,000 |
Total liabilities | 22,290 | 25,746 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 11,445,187 shares authorized Series A Preferred stock, none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value; 55,000,000 shares authorized, and 12,948,950 and 13,059,341 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively | 13 | 13 |
Additional paid-in capital | 360,698 | 356,054 |
Accumulated deficit | (322,431) | (288,900) |
Total stockholders' equity | 38,280 | 67,167 |
Total liabilities and stockholders' equity | $ 60,570 | 92,913 |
Preferred Class A [Member] | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value, 11,445,187 shares authorized Series A Preferred stock, none issued and outstanding | $ 0 |
CONSOLIDATED CONDENSED BALANC_2
CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Accounts receivable, allowances for bad debts and customer credits | $ 615 | $ 892 |
Stockholders' equity: | ||
Preferred stock, authorized | 11,445,187 | 11,445,187 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, authorized | 55,000,000 | 55,000,000 |
Common stock, issued | 12,948,950 | 13,059,341 |
Common stock, outstanding | 12,948,950 | 13,059,341 |
Preferred Class A [Member] | ||
Stockholders' equity: | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
CONSOLIDATED CONDENSED STATEMEN
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues: | ||||
Lead fees | $ 24,986 | $ 27,711 | $ 71,277 | $ 83,149 |
Advertising | 6,606 | 8,946 | 21,643 | 24,914 |
Other revenues | 103 | 215 | 416 | 741 |
Total revenues | 31,695 | 36,872 | 93,336 | 108,804 |
Cost of revenues | 26,278 | 25,786 | 74,702 | 74,171 |
Cost of revenues - impairment | 9,014 | 0 | 9,014 | 0 |
Gross profit | (3,597) | 11,086 | 9,620 | 34,633 |
Operating expenses: | ||||
Sales and marketing | 3,333 | 3,692 | 10,096 | 10,684 |
Technology support | 4,303 | 3,141 | 10,653 | 9,582 |
General and administrative | 3,639 | 2,818 | 11,980 | 9,040 |
Depreciation and amortization | 1,172 | 1,192 | 3,495 | 3,623 |
Goodwill impairment | 0 | 0 | 5,133 | 0 |
Long-lived asset impairment | 1,968 | 0 | 1,968 | 0 |
Total operating expenses | 14,415 | 10,843 | 43,325 | 32,929 |
Operating (loss) income | (18,012) | 243 | (33,705) | 1,704 |
Interest and other income (expense), net | (24) | (93) | 178 | (289) |
(Loss) Income before income tax provision | (18,036) | 150 | (33,527) | 1,415 |
Income tax provision | 0 | 81 | 4 | 539 |
Net (loss) income and comprehensive (loss) income | $ (18,036) | $ 69 | $ (33,531) | $ 876 |
Basic (loss) earnings per common share | $ (1.41) | $ 0.01 | $ (2.64) | $ 0.08 |
Diluted (loss) earnings per common share | $ (1.41) | $ 0.01 | $ (2.64) | $ 0.07 |
CONSOLIDATED CONDENSED STATEM_2
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows from operating activities: | ||
Net (loss) income and comprehensive (loss) income | $ (33,531) | $ 876 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 6,534 | 5,499 |
Goodwill impairment | 5,133 | 0 |
Intangible asset impairment | 9,014 | 0 |
Provision for bad debts | 216 | 294 |
Provision for customer credits | 177 | 29 |
Share-based compensation | 4,365 | 2,918 |
Gain on investment | (25) | 0 |
Loss on disposal of assets | 0 | 7 |
Long-lived asset impairment | 1,968 | 0 |
Change in deferred tax asset | 692 | 119 |
Changes in assets and liabilities: | ||
Accounts receivable | 251 | 5,808 |
Prepaid expenses and other current assets | 532 | (392) |
Other assets | (615) | 132 |
Accounts payable | 3,303 | 290 |
Accrued expenses and other current liabilities | 1,243 | (3,112) |
Net cash (used in) provided by operating activities | (743) | 12,468 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (828) | (1,618) |
Purchase of intangible asset | 0 | (600) |
Proceeds from sale of investment? | 125 | 0 |
Net cash used in investing activities | (703) | (2,218) |
Cash flows from financing activities: | ||
Payments on term loan borrowings | 0 | (3,938) |
Payment on revolving credit facility | (8,000) | 0 |
Repurchase of common stock | 0 | (1,196) |
Proceeds from issuance of common stock | 200 | 0 |
Proceeds from exercise of stock options | 77 | 1,068 |
Net cash used in financing activities | (7,723) | (4,066) |
Net (decrease) increase in cash and cash equivalents | (9,169) | 6,184 |
Cash and cash equivalents, beginning of period | 24,993 | 38,512 |
Cash and cash equivalents, end of period | 15,824 | 44,696 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 0 | 445 |
Cash paid for interest | $ 103 | $ 648 |
Organization and Operations
Organization and Operations | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | AutoWeb, Inc. (“ AutoWeb Company Dealers Manufacturers The Company’s consumer-facing automotive websites (“ Company Websites Leads The Company was incorporated in Delaware on May 17, 1996. Its principal corporate offices are located in Irvine, California. The Company’s common stock is listed on The NASDAQ Capital Market under the symbol AUTO. On October 9, 2017, the Company changed its name from Autobytel Inc. to AutoWeb, Inc., assuming the name of AutoWeb, Inc., which was the name of the company that the Company acquired in October 2015. In connection with this name change, the Company changed its stock ticker symbol from “ABTL” to “AUTO” on The NASDAQ Capital Market. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated condensed financial statements are presented on the same basis as the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 (“ 2017 Form 10-K SEC GAAP |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Issued but not yet adopted by the Company The Company considers the applicability and impact of all Accounting Standards Updates (“ ASU FASB Accounting Standards Codification 220 “Comprehensive Income.” TCJA Accounting Standards Codification 842 “Leases.” In July 2018, the FASB issued updated guidance which allows an additional transition method to adopt the new leases standard at the adoption date, as compared to the beginning of the earliest period presented and recognize a cumulative-effect adjustment to the beginning balance of retained earnings in the period of adoption. The Company expects to elect this transition method at the adoption date of January 1, 2019. The Company continues to analyze its lease portfolio to determine the impact that the new standard will have on its consolidated financial statements. Further, the Company is in the process of reviewing and updating our business processes, as necessary, to assist in our ongoing lease data collection and analysis. Additionally, the Company is updating its accounting policies and internal controls that would be impacted by the new guidance, to ensure readiness for adoption in the first quarter of 2019. SEC Release No. 33-10532, Disclosure Update and Simplification. Disclosure Update and Simplification” Recently adopted by the Company Accounting Standards Codification 606 “Revenue from Contracts with Customers.” Accounting Standards Codification 805 “Business Combinations.” Accounting Standards Codification 718 “Compensation – Stock Compensation.” |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Revenue Recognition | Revenue is recognized when the Company transfers control of promised goods or services to the Company’s customers, or when the Company satisfies any performance obligations under contract. The amount of revenue recognized reflects the consideration the Company expects to be entitled to in exchange for respective goods or services provided. Further, under ASC 606, contract assets or contract liabilities that arise from past performance but require further performance before obligation can be fully satisfied must be identified and recorded on the balance sheet until respective settlements have been met. The Company performs the following steps in order to properly determine revenue recognition and identify relevant contract assets and contract liabilities: ● identify the contract with a customer; ● identify the performance obligations in the contract; ● determine the transaction price; ● allocate the transaction price to the performance obligations in the contract; and ● recognize revenue when, or as, the Company satisfies a performance obligation. The Company earns revenue by providing leads, advertising, and mobile products and services used by Dealers and Manufacturers in their efforts to market and sell new and used vehicles to consumers. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The Company records revenue on distinct performance obligations at a single point in time, when control is transferred to the customer. The Company has three main revenue sources – Lead fees, advertising, and other revenue. Accordingly, the Company recognizes revenue for each source as described below: ● Lead fees - paid by Dealers and Manufacturers participating in the Company’s Lead programs and are comprised of Lead transaction and/or monthly subscription fees. Lead fees are recognized in the period when service is provided. ● Advertising - fees paid by Dealers and Manufacturers for (i) display advertising on the Company’s websites and (ii) fees from the Company’s click traffic program. Revenue is recognized in the period advertisements are displayed on the Company’s websites or the period in which clicks have been delivered, as applicable. The Company recognizes gross revenue from the delivery of action-based advertisements in the period in which a user takes the action for which the marketer contracted for with the Company. For advertising revenue arrangements where the Company is not the principal, the Company recognizes revenue on a net basis. ● Other revenues - consists primarily of revenues from the Company’s mobile products and revenues from the Company’s Reseller Agreement with SaleMove, Inc. Revenue is recognized in the period in which products or services are sold. Variable Consideration The Company’s products, namely Leads, are generally sold with a right-of-return for services that do not meet customer requirements as specified by the relevant contract. Rights-of-return are estimable, and provisions for estimated returns are recorded as a reduction in revenue by the Company in the period revenue is recognized, and thereby accounted for as variable consideration. The Company includes the allowance for customer credits in its net accounts receivable balances on the Company’s balance sheet at period end. Allowance for customer credits totaled $133,000 and $213,000 as of September 30, 2018 and December 31, 2017, respectively. See further discussion below on significant judgments exercised by the Company in regards to variable consideration. Contract Assets and Contract Liabilities Unbilled Revenue Timing of revenue recognition may differ from the timing of invoicing to customers. The Company records a receivable when revenue is recognized prior to invoicing. From time-to-time, the Company may have balances on its balance sheet representing revenue that has been recognized by the Company upon satisfaction of performance obligations and earning a right to receive payment. These not-yet invoiced receivable balances are driven by the timing of administrative transaction processing, and are not indicative of partially complete performance obligations, or unbilled revenue Deferred Revenue The Company defers the recognition of revenue when cash payments are received or due in advance of satisfying its performance obligations, including amounts which are refundable. Such activity is not a common practice of operation for the Company. The Company had zero deferred revenue included in its consolidated balance sheets as of September 30, 2018 and December 31, 2017. Payment terms and conditions can vary by contract type. Generally, payment terms within the Company’s customer contracts include a requirement of payment within 30 to 60 days from date of invoice. Typically, customers make payments after receipt of invoice for billed services, and less typically, in advance of rendered services. Practical Expedients and Exemptions The Company excludes from the transaction price all sales taxes related to revenue producing transactions collected from the customer for a governmental authority. The Company applies the new revenue standard requirements to a portfolio of contracts (or performance obligations) with similar characteristics for transactions where it is expected that the effects of applying the revenue recognition guidance to the portfolio would not differ materially on the financial statements from that of applying the same guidance to the individual contracts (or performance obligations) within that portfolio. The Company generally expenses incremental costs of obtaining a contract when incurred because the amortization period would be less than one year. These costs primarily relate to sales commissions and are recorded in selling, marketing, and distribution expense. Significant Judgments The Company provides Dealers and Manufacturers with various opportunities to market their vehicles to potential vehicle buyers, namely via consumer lead and click traffic referrals and online advertising products and services. Proper revenue recognition of digital marketing activities, as well as proper recognition of assets and liabilities related to these activities, requires management to exercise significant judgment with the following items: ● Arrangements with Multiple Performance Obligations The Company enters into contracts with customers that often include multiple products and services to a customer. Determining whether products and/or services are distinct performance obligations that should be accounted for singularly or separately may require significant judgment. ● Variable Consideration and Customer Credits The Company’s products are generally sold with a right-of-return. Additionally, the Company will sometimes provide customer credits or sales incentives. These items are accounted for as variable consideration when determining the allocation of the transaction price to performance obligations under a contract. The allowance for customer credits is an estimate of adjustments for services that do not meet customer requirements. Additions to the estimated allowance for customer credits are recorded as a reduction of revenues and are based on the Company’s historical experience of: (i) the amount of credits issued; (ii) the length of time after services are rendered that the credits are issued; (iii) other factors known at the time; and (iv) future expectations. Reductions in the estimated allowance for customer credits are recorded as an increase in revenues. As specific customer credits are identified, they are charged against this allowance with no impact on revenues. Returns and credits are measured at contract inception, with respective obligations reviewed each reporting period or as further information becomes available, whichever is earlier, and only to the extent that it is probable that a significant reversal of any incremental revenue will not occur. The allowance for customer credits is included in the net accounts receivable balances of the Company’s balance sheets as of September 30, 2018 and December 31, 2017. The Company has not made any significant changes to judgments in applying ASC 606 during the nine months ended September 30, 2018. Disaggregation of Revenue The Company disaggregates revenue from contracts with customers by revenue source and has determined that disaggregating revenue into these categories sufficiently depicts the differences in the nature, amount, timing, and uncertainty of its revenue streams. The Company has three main sources of revenue: lead fees, advertising, and other revenues. The following table summarizes revenue from contracts with customers, disaggregated by revenue source, for the three and nine months ended September 30, 2018 and 2017. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities. Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (in thousands) Lead fees $ 24,986 $ 27,711 $ 71,277 $ 83,149 Advertising Clicks 5,559 7,436 18,020 20,403 Display and other advertising 1,047 1,510 3,623 4,511 Other revenues 103 215 416 741 Total revenue $ 31,695 $ 36,872 $ 93,336 $ 108,804 |
Net Earnings (Loss) Per Share a
Net Earnings (Loss) Per Share and Stockholders’ Equity | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Earnings (Loss) Per Share and Stockholders’ Equity | Basic net earnings (loss) per share is computed using the weighted average number of common shares outstanding during the period, excluding any unvested restricted stock. Diluted net earnings (loss) per share is computed using the weighted average number of common shares, and if dilutive, potential common shares outstanding, as determined under the treasury stock and if-converted methods, during the period. Potential common shares consist of unvested restricted stock and common shares issuable upon the exercise of stock options, the exercise of warrants, and conversion of convertible notes. The Company used the following share amounts to compute the basic and diluted net (loss) earnings per share for the three and nine months ended September 30, 2018 and 2017: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Basic Shares: Weighted average common shares outstanding 12,948,150 12,881,812 12,959,666 11,729,181 Weighted average unvested restricted stock (161,413 ) (119,584 ) (249,084 ) (115,574 ) Weighted average common shares repurchased — (60,230 ) — (20,297 ) Basic Shares 12,786,737 12,701,998 12,710,582 11,593,310 Diluted Shares: Basic shares 12,786,737 12,701,998 12,710,582 11,593,310 Weighted average dilutive securities — 498,587 — 621,449 Incremental shares from convertible preferred stock — — — 1,064,660 Diluted Shares 12,786,737 13,200,585 12,710,582 13,279,419 For the three and nine months ended September 30, 2018, the Company’s basic and diluted net loss per share are the same since the Company generated a net loss for the period and potentially dilutive securities are excluded from diluted net loss per share because they have an anti-dilutive impact. For the three and nine months ended September 30, 2017, weighted average dilutive securities included dilutive options, restricted stock awards, and shares of common stock issued in June 2017 upon conversion of the Series B Junior Participating Convertible Preferred Stock, $0.001 par value per share, (“ Series B Preferred Stock AWI For the three and nine months ended September 30, 2018, 4.2 and 4.3 million of potentially anti-dilutive securities related to common stock have been excluded from the calculation of diluted net earnings per share, respectively. For the three and nine months ended September 30, 2017, 3.9 and 3.1 million of potentially anti-dilutive securities related to common stock have been excluded from the calculation of diluted net earnings per share. On September 6, 2017, the Company announced that its board of directors authorized the Company to repurchase up to $3.0 million of the Company’s common stock. Under the repurchase program, the Company may repurchase common stock from time to time on the open market or in private transactions. This authorization does not require the Company to purchase a specific number of shares, and the board of directors may suspend, modify or terminate the program at any time. The Company anticipates that it would fund future repurchases, if any, through the use of available cash. No shares were repurchased during the three and nine months ended September 30, 2018. As of September 30, 2018, $2.3 million remains available for the Company to repurchase common stock. On June 22, 2017, the Company obtained stockholder approval for the issuance of shares of the Company’s common stock upon (i) the conversion of the Company’s then outstanding Series B Preferred Stock; and (ii) the conversion of shares of Series B Preferred Stock that would be issued upon exercise of the warrant to purchase up to 148,240 shares of Series B Preferred Stock issued in connection with the acquisition of AWI (“ AWI Warran Warrants. AutoUSA Warrant The AWI Warrant was valued at $1.72 per share for a total value of $2.5 million. The Company used an option pricing model to determine the value of the AWI Warrant. Key assumptions used in valuing the AWI Warrant were as follows: risk-free interest rate of 1.9%, stock price volatility of 74.0% and a term of 7.0 years. The AWI Warrant was valued based on long-term stock price volatilities of the Company’s common stock. On June 22, 2017, the Company received stockholder approval which resulted in the automatic conversion of the AWI Warrant into warrants to acquire up to 1,482,400 shares of the Company’s common stock at an exercise price of $18.45 per share of common stock. The AWI Warrant became exercisable on October 1, 2018, subject to the following vesting conditions: (i) with respect to the first one-third (1/3) of the warrant shares, if at any time after the issuance date of the AWI Warrant and prior to the expiration date of the AWI Warrant the weighted average closing price of the Company’s common stock for the preceding 30 trading days (adjusted for any stock splits, stock dividends, reverse stock splits or combinations of the Company’s common stock occurring after the issuance date) (“ Weighted Average Closing Price |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-based compensation expense is included in costs and expenses in the accompanying Unaudited Consolidated Condensed Statements of Operations and Comprehensive Income (Loss) as follows: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (in thousands) Share-based compensation expense: Cost of revenues $ 2 $ 20 $ 21 $ 59 Sales and marketing 520 409 904 1,222 Technology support 886 138 1,213 401 General and administrative 388 397 2,228 1,238 Share-based compensation costs 1,796 964 4,366 2,920 Less amount capitalized to internal use software: — 1 1 2 Total share-based compensation costs $ 1,796 $ 963 $ 4,365 $ 2,918 During the nine months ended September 30, 2018, certain awards were modified or accelerated in connection with the termination of employment of certain former officers of the Company. In accordance with guidance provided under ASC 718 and related ASU No. 2017-09 and ASU No. 2018-07, the Company recognized award modification and acceleration expenses related to these events in the period incurred. Modification expense was determined by using the Black-Scholes option pricing model to estimate the fair value of the modified awards as of the new measurement date and respective fair value assumptions. As reflected in the table above, the Company recognized award modification and acceleration expense of $1.2 million and $2.1 million in the three and nine months ended September 30, 2018, respectively. There were no modification or acceleration expenses recognized in 2017. Service-Based Options. Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Number of service-based options granted 33,000 83,850 1,749,700 457,100 Weighted average grant date fair value $ 1.65 $ 3.72 $ 1.83 $ 6.29 Weighted average exercise price $ 3.04 $ 7.23 $ 3.29 $ 12.51 The Company recognizes compensation expense for stock option grants based on the fair value at the date of grant using the Black-Scholes option pricing model. The Company uses historical data, among other factors, to estimate the expected option life and has elected to estimate forfeiture rates. The risk-free rate is based on the United States Treasury Department yield curve in effect at the time of grant for the expected life of the option. The Company assumes an expected dividend yield of zero for all periods. Options generally vest one-third on the first anniversary of the grant date and ratably over twenty-four months thereafter. The vesting of these awards is contingent upon the employee’s continued employment with the Company during the vesting period and vesting may be accelerated in the event of a change in control of the Company. In April 2018, the Company entered into an Inducement Stock Option Award Agreement with the Company’s CEO, Jared Rowe (“ Rowe Option Award Agreement Rowe Employment Options Market Condition Options. Former CEO Former CEO Market Condition Options Stock option exercises. Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Number of stock options exercised 1,000 15,000 16,967 191,074 Weighted average exercise price $ 1.75 $ 4.20 $ 4.51 $ 5.58 The grant date fair value of stock options granted during these periods was estimated using the Black-Scholes option pricing model using the weighted average assumptions listed below: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Dividend yield — — — — Volatility 66 % 63 % 68 % 62 % Risk-free interest rate 2.9 % 1.8 % 2.6 % 1.8 % Expected life (years) 4.5 4.4 4.5 4.4 Restricted Stock Awards RSAs The Company granted an aggregate of 345,000 RSAs on September 27, 2017 to senior officers of the Company. These RSAs are service- based and the forfeiture restrictions lapse with respect to one-third of the restricted stock on each of the first, second, and third anniversaries of the date of the award. During the nine months ended September 30, 2018, 80,000 shares of RSAs were forfeited upon the resignation of two executive officers, the forfeiture restrictions on 175,000 shares of RSA lapsed upon the termination of employment of the former CEO and three officers of the Company, and the forfeiture restrictions of 40,000 shares of RSAs were modified upon the entry into a consulting agreement with a former executive officer. During the three months ended September 30, 2018, the forfeiture restrictions on 90,000 shares of RSAs lapsed in connection with the termination of employment of three officers of the Company. Accordingly, the Company recognized expenses of $364,000 and $787,000 related to the acceleration of vesting and modification of RSAs in the three and nine months ended September 30, 2018, respectively. As of September 30, 2018, 60,000 shares of RSAs remain unvested. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2018 | |
Investments [Abstract] | |
Investments | The Company’s investments at September 30, 2018 and December 31, 2017 consisted primarily of investments in SaleMove and GoMoto, Inc., GoMoto In September 2013, the Company entered into a Convertible Note Purchase Agreement with SaleMove in which AutoWeb invested $150,000 in SaleMove in the form of an interest bearing, convertible promissory note. In November 2014, the Company invested an additional $400,000 in SaleMove in the form of an interest bearing, convertible promissory note. Upon closing of a preferred stock financing by SaleMove in July 2015, these two notes were converted in accordance with their terms into an aggregate of 190,997 Series A Preferred Stock, which shares were previously classified as a long-term investment on the consolidated balance sheet. The Company recorded an impairment charge of $0.6 million in SaleMove in the three months ended December 31, 2017. On, June 5, 2018, the Company sold its shares of Series A Preferred stock back to SaleMove for $125,000. The gain of $125,000 is recorded in Interest and other income (expense) on the Unaudited Consolidated Condensed Statement of Operations and Comprehensive Income (Loss) for the nine months ended September 30, 2018. In October 2013, the Company entered into a Reseller Agreement with SaleMove to become a reseller of SaleMove’s technology for enhancing communications with consumers. SaleMove’s technology allows Dealers and Manufacturers to enhance the online shopping experience by interacting with consumers in real-time, including live video, audio, and text-based chat or by phone. The Company and SaleMove share equally in revenues from automotive-related sales of the SaleMove products and services. In connection with this reseller arrangement, the Company advanced $1.0 million to SaleMove to fund SaleMove’s 50% share of various product development, marketing and sales costs and expenses. These previously advanced funds are repaid to the Company from SaleMove’s share of net revenues and expenses from the Reseller Agreement each reporting period. During the three months ended September 30, 2018, the Company performed a qualitative review of the agreement with SaleMove and, based on several factors related to the trend in operating results from this reseller arrangement and costs being incurred by the Company, the parties agreed to allow the arrangement to expire November 30, 2018, one month earlier than the original expiration date of December 31, 2018. Upon expiration of the Reseller Agreement, the remaining outstanding advances are no longer recoverable from SaleMove, and, accordingly, the Company has impaired the remaining balance of $364,000 of advances due from SaleMove. The impairment charge is included in “Long-lived asset impairment” in the Unaudited Consolidated Condensed Statement of Operations and Comprehensive (Loss)Income for the three and nine months ended September 30, 2018. In December 2014, the Company entered into a Series Seed Preferred Stock Purchase Agreement with GoMoto in which the Company paid $100,000 for 317,460 shares of Series Seed Preferred Stock, $0.001 par value per share. The $100,000 investment in GoMoto was recorded at cost because the Company does not have significant influence over GoMoto. In October 2015 and May 2016, the Company invested an additional $375,000 and $375,000, respectively, in GoMoto in the form of convertible promissory notes (“ GoMoto Notes |
Selected Balance Sheet Accounts
Selected Balance Sheet Accounts | 9 Months Ended |
Sep. 30, 2018 | |
Selected Balance Sheet Accounts [Abstract] | |
Selected Balance Sheet Accounts | Property and equipment September 30, 2018 December 31, 2017 (in thousands) Computer software and hardware $ 11,585 $ 11,065 Capitalized internal use software 5,977 5,774 Furniture and equipment 1,743 1,703 Leasehold improvements 1,605 1,539 20,910 20,081 Less—Accumulated depreciation and amortization (17,296 ) (15,770 ) Property and Equipment, net $ 3,614 $ 4,311 Concentration of Credit Risk and Risks Due to Significant Customers Accounts receivable are primarily derived from fees billed to Dealers and Manufacturers. The Company generally requires no collateral to support its accounts receivables and maintains an allowance for bad debts for potential credit losses. The Company has a concentration of credit risk with its automotive industry-related accounts receivable balances, particularly with Urban Science Applications (which represents Acura, Audi, Honda, Nissan, Infiniti, Subaru, Toyota, Volkswagen, and Volvo), Trilogy, General Motors and Media.net Advertising. During the first nine months of 2018, approximately 42% of the Company’s total revenues was derived from these four customers, and approximately 51%, or $13.2 million of gross accounts receivables related to these four customers at September 30, 2018. During the first nine months of 2017, approximately 33% of the Company’s total revenues was derived from Urban Science Applications, General Motors and Media.net, and approximately 43%, or $12.2 million of gross accounts receivables, related to these three customers at September 30, 2017. Accrued Expenses and Other Current Liabilities September 30, 2018 December 31, 2017 (in thousands) Other accrued expenses $ 7,154 $ 6,307 Amounts due to customers 392 438 Other current liabilities 437 507 Total other accrued expenses and other current liabilities $ 7,983 $ 7,252 Convertible Notes Payable AutoUSA Note |
Long-Lived Assets and Impairmen
Long-Lived Assets and Impairment | 9 Months Ended |
Sep. 30, 2018 | |
Long-lived Assets And Impairment | |
Long-Lived Assets and Impairment | Intangible Assets. The Company’s intangible assets are amortized over the following estimated useful lives ( in thousands September 30, 2018 (in thousands) December 31, 2017 (in thousands) Definite-lived Estimated Useful Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trademarks/trade names/licenses/domains 3 -7 years $ 16,589 $ (14,734 ) $ 1,855 $ 16,589 $ (4,037 ) $ 12,552 Software and publications 3 years 1,300 (1,300 ) — 1,300 (1,300 ) — Customer relationships 2 - 10 years 19,563 (14,485 ) 5,078 19,563 (10,555 ) 9,008 Employment/non-compete agreements 1 - 5 years 1,510 (1,510 ) — 1,510 (1,493 ) 17 Developed technology 5 - 7 years 8,955 (4,601 ) 4,354 8,955 (3,619 ) 5,336 $ 47,917 $ (36,630 ) $ 11,287 $ 47,917 $ (21,004 ) $ 26,913 September 30, 2018 December 31, 2017 Indefinite-lived Estimated Useful Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Domain Indefinite $ 2,200 $ — $ 2,200 $ 2,200 $ — $ 2,200 Amortization expense on intangible assets with definite lives is included in both Cost of revenues and Depreciation and amortization in the Unaudited Consolidated Condensed Statements of Operations. Total amortization expense was $1.6 million and $5.0 million for the three and nine months ended September 30, 2018, respectively. Amortization expense was $1.3 million and $4.1 million for the three and nine months ended September 30, 2017, respectively. Amortization expense for the remainder of the year and for future years is as follows: Amortization Expense Year (in thousands) 2018 $ 1,511 2019 4,872 2020 2,371 2021 1,499 2022 902 Thereafter 132 $ 11,287 Goodwill. (in thousands) Goodwill as of December 31, 2017 $ 5,133 Impairment charge (5,133 ) Goodwill as of September 30, 2018 $ — Impairment Testing of Intangible Assets On October 5, 2017, the Company and DealerX Partners, LLC, a Florida limited liability company (“ DealerX DealerX License Agreement The transaction consideration consisted of: (i) $8.0 million in cash paid to DealerX upon execution of the DealerX License Agreement and (ii) the right to 710,856 shares of the Company’s common stock, par value $0.001 per share, representing approximately five percent of the Company’s outstanding Common Stock as of the date the parties entered into the DealerX License Agreement (“ Market Capitalization Shares Platform Support Obligations Alternative Cash Payment The Company makes judgments about the recoverability of purchased intangible assets with definite lives whenever events or changes in circumstances indicate that an impairment may exist. Recoverability of purchased intangible assets with definite lives is measured by comparing the carrying amount of the asset to the future undiscounted cash flows the asset is expected to generate. In the third quarter of 2018, the Company performed an analysis of its planned future use of two intangible assets in the licenses and customer relationships asset groups. As a result of realignment activities finalized in the third quarter, the Company made a determination that the Company's use of certain assets would not be continued as originally planned. Accordingly, the Company performed further analysis to quantitatively determine the amount of impairment for each of these intangible assets as of September 30, 2018. A structured test was performed with the DealerX license intangible asset, whereby lead generation and acquisition cost, amongst other things, was compare to alternate sources of lead generation available to the Company. As a result of the Company’s analysis, the Company concluded that the effectiveness of the platform was not in-line with the enhanced consumer-to-client matchmaking that the Company is seeking and made the decision in the third quarter to terminate DealerX’s Platform Support Obligations, significantly impacting the usability of the asset by the Company. Accordingly, the Company recorded impairment charges of $9.0 million in connection with the impairment of this long-lived asset with the expense recorded in Cost of revenues-impairment on the Company’s Unaudited Consolidated Condensed Statements of Operations and Comprehensive Income (Loss) for the three and nine months ended September 30, 2018. A quantitative analysis was performed by the Company on its customer relationship intangible assets, whereby it examined available data, namely historical activity and cash flows resulting from the customer relationships of previous acquisitions, in concert with projected future use of acquired customer relationships within the parameters of the Company’s future strategic plans. As a result of this analysis, the Company determined there to be impairment of $1.6 million related to customer relationship intangible assets acquired in a 2015 acquisition for which projected cash flows did not support the carrying values. Additionally, the Company determined that the estimated useful life of these customer relationship intangible assets had changed from 10 years to 5 years. This change in estimate has no impact on the current period but will impact amortization expense in future periods as amortization will be accelerated over the remaining estimated useful life of this asset due to the change in estimate. |
Credit Facility
Credit Facility | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Credit Facility | The Company and MUFG Union Bank, N.A. entered into a Loan Agreement dated February 26, 2013, as amended on September 10, 2013, January 13, 2014, May 20, 2015, June 1, 2016, June 28, 2017, and December 27, 2017 (the original Loan Agreement, as amended, is referred to collectively as the “ Credit Facility Agreement Revolving Loan |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Employment Agreements The Company has employment agreements and severance benefits/retention agreements with certain key employees. A number of these agreements require severance payments and continuation of certain insurance benefits in the event of a termination of the employee’s employment by the Company without cause or by the employee for good reason (as defined is these agreements). Stock option agreements and restricted stock award agreements with some key employees provide for acceleration of vesting of stock options and lapsing of forfeiture restrictions on restricted stock in the event of a change in control of the Company, upon termination of employment by the Company without cause or by the employee for good reason, or upon the employee’s death or disability. Litigation From time to time, the Company may be involved in litigation matters arising from the normal course of its business activities. Such litigation, even if not meritorious, could result in substantial costs and diversion of resources and management attention, and an adverse outcome in litigation could materially adversely affect its business, results of operations, financial condition and cash flows. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | On December 22, 2017, the U.S. government enacted comprehensive tax legislation known as the TCJA. The TCJA made a number of changes to the federal income tax law that took effect in 2018, including, but not limited to (1) reduction of the U.S. federal corporate tax rate from a maximum of 35% to 21%; (2) elimination of the corporate alternative minimum tax; (3) a new limitation on deductible interest expense; (4) the Transition Tax; (5) limitations on the deductibility of certain executive compensation; (6) changes to the bonus depreciation rules for fixed asset additions: and (7) limitations on net operating loss carryovers generated after December 31, 2017, to 80% of taxable income. ASC 740 “ Income Taxes SAB 118 At September 30, 2018 and December 31, 2017, the Company has not completed its accounting for the tax effects of enactment of the TCJA; however, the Company has made a reasonable estimate of the effects of the TCJA’s change in the federal rate and revalued its deferred tax assets based on the rates at which they are expected to reverse in the future, which is generally the new 21% federal corporate tax rate plus applicable state tax rate. For the year ended December 31, 2017, the Company recorded a decrease in deferred tax assets and deferred tax liabilities of $11.7 million and $0.0 million, respectively, with a corresponding net adjustment to deferred income tax expense of $11.7 million. In addition, in 2017, the Company recognized a deemed repatriation of $0.6 million of deferred foreign income from its Guatemala subsidiary, which did not result in any incremental tax cost after application of foreign tax credits. The Company’s provisional estimates will be adjusted during the measurement period defined under SAB 118, based upon ongoing analysis of data and tax positions along with the new guidance from regulators and interpretations of the law. On an interim basis, the Company estimates an annual effective tax rate and records a quarterly income tax provision in accordance with the estimated annual rate, adjusted accordingly by the tax effect of certain discrete items that arise during the quarter. As the fiscal year progresses, the Company refines its estimated annual effective tax rate based on actual year-to-date results recognized for the year-to-date. This process can result in significant changes to the Company's estimated effective tax rate. When such activity occurs, the income tax provision is adjusted during the quarter in which the estimates are refined and adjusted. As such, the Company’s year-to-date tax provision reflects the estimated annual effective tax rate. These changes, along with adjustments to the Company's deferred taxes and related valuation allowance, may create fluctuation in the overall effective tax rate from period to period. During 2017, management assessed available evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative losses incurred over the three-year period ended December 31, 2017. The Company was projecting pre-tax income for 2017 until the three months ended December 31, 2017, in which the Company incurred a significant pre-tax loss due to the impairment of goodwill. The Company experienced increased costs of providing services to its customers, as well as decrease in market share resulting from increased competition. Additionally, the Company also projects that 2018 pre-tax profits, if any, may not offset the cumulative three-year pre-tax loss as of December 31, 2017. Based on this evaluation, the Company recorded an additional valuation allowance of $16.7 million against its deferred tax assets during the year ended December 31, 2017. At September 30, 2018 and December 31, 2017, the Company has recorded a valuation allowance of $21.3 million against its deferred tax assets. The Company’s effective tax rate for the nine months ended September 30, 2018 differed from the U.S. federal statutory rate primarily due to operating losses that receive no tax benefit as a result of an existing valuation allowances recorded against the Company’s existing tax assets. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Issued but not yet adopted by the Company The Company considers the applicability and impact of all Accounting Standards Updates (“ ASU FASB Accounting Standards Codification 220 “Comprehensive Income.” TCJA Accounting Standards Codification 842 “Leases.” In July 2018, the FASB issued updated guidance which allows an additional transition method to adopt the new leases standard at the adoption date, as compared to the beginning of the earliest period presented and recognize a cumulative-effect adjustment to the beginning balance of retained earnings in the period of adoption. The Company expects to elect this transition method at the adoption date of January 1, 2019. The Company continues to analyze its lease portfolio to determine the impact that the new standard will have on its consolidated financial statements. Further, the Company is in the process of reviewing and updating our business processes, as necessary, to assist in our ongoing lease data collection and analysis. Additionally, the Company is updating its accounting policies and internal controls that would be impacted by the new guidance, to ensure readiness for adoption in the first quarter of 2019. SEC Release No. 33-10532, Disclosure Update and Simplification. Disclosure Update and Simplification” Recently adopted by the Company Accounting Standards Codification 606 “Revenue from Contracts with Customers.” Accounting Standards Codification 805 “Business Combinations.” Accounting Standards Codification 718 “Compensation – Stock Compensation.” |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Revenue from contracts | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (in thousands) Lead fees $ 24,986 $ 27,711 $ 71,277 $ 83,149 Advertising Clicks 5,559 7,436 18,020 20,403 Display and other advertising 1,047 1,510 3,623 4,511 Other revenues 103 215 416 741 Total revenue $ 31,695 $ 36,872 $ 93,336 $ 108,804 |
Net Earnings (Loss) Per Share_2
Net Earnings (Loss) Per Share and Stockholders’ Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted net earnings (loss) per share | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Basic Shares: Weighted average common shares outstanding 12,948,150 12,881,812 12,959,666 11,729,181 Weighted average unvested restricted stock (161,413 ) (119,584 ) (249,084 ) (115,574 ) Weighted average common shares repurchased — (60,230 ) — (20,297 ) Basic Shares 12,786,737 12,701,998 12,710,582 11,593,310 Diluted Shares: Basic shares 12,786,737 12,701,998 12,710,582 11,593,310 Weighted average dilutive securities — 498,587 — 621,449 Incremental shares from convertible preferred stock — — — 1,064,660 Diluted Shares 12,786,737 13,200,585 12,710,582 13,279,419 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based compensation expense included in costs and expenses | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 (in thousands) Share-based compensation expense: Cost of revenues $ 2 $ 20 $ 21 $ 59 Sales and marketing 520 409 904 1,222 Technology support 886 138 1,213 401 General and administrative 388 397 2,228 1,238 Share-based compensation costs 1,796 964 4,366 2,920 Less amount capitalized to internal use software: — 1 1 2 Total share-based compensation costs $ 1,796 $ 963 $ 4,365 $ 2,918 |
Service based options granted during period | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Number of service-based options granted 33,000 83,850 1,749,700 457,100 Weighted average grant date fair value $ 1.65 $ 3.72 $ 1.83 $ 6.29 Weighted average exercise price $ 3.04 $ 7.23 $ 3.29 $ 12.51 |
Stock option exercises | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Number of stock options exercised 1,000 15,000 16,967 191,074 Weighted average exercise price $ 1.75 $ 4.20 $ 4.51 $ 5.58 |
Fair value of stock options granted using the following weighted average assumptions | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Dividend yield — — — — Volatility 66 % 63 % 68 % 62 % Risk-free interest rate 2.9 % 1.8 % 2.6 % 1.8 % Expected life (years) 4.5 4.4 4.5 4.4 |
Selected Balance Sheet Accoun_2
Selected Balance Sheet Accounts (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Selected Balance Sheet Accounts [Abstract] | |
Property and equipment | September 30, 2018 December 31, 2017 (in thousands) Computer software and hardware $ 11,585 $ 11,065 Capitalized internal use software 5,977 5,774 Furniture and equipment 1,743 1,703 Leasehold improvements 1,605 1,539 20,910 20,081 Less—Accumulated depreciation and amortization (17,296 ) (15,770 ) Property and Equipment, net $ 3,614 $ 4,311 |
Accrued expenses and other current liabilities | September 30, 2018 December 31, 2017 (in thousands) Other accrued expenses $ 7,154 $ 6,307 Amounts due to customers 392 438 Other current liabilities 437 507 Total other accrued expenses and other current liabilities $ 7,983 $ 7,252 |
Long-Lived Assets and Impairm_2
Long-Lived Assets and Impairment (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Longlived Assets And Impairment Tables Abstract | |
Intangible assets amortized over the estimated useful lives | September 30, 2018 (in thousands) December 31, 2017 (in thousands) Definite-lived Estimated Useful Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trademarks/trade names/licenses/domains 3 -7 years $ 16,589 $ (14,734 ) $ 1,855 $ 16,589 $ (4,037 ) $ 12,552 Software and publications 3 years 1,300 (1,300 ) — 1,300 (1,300 ) — Customer relationships 2 - 10 years 19,563 (14,485 ) 5,078 19,563 (10,555 ) 9,008 Employment/non-compete agreements 1 - 5 years 1,510 (1,510 ) — 1,510 (1,493 ) 17 Developed technology 5 - 7 years 8,955 (4,601 ) 4,354 8,955 (3,619 ) 5,336 $ 47,917 $ (36,630 ) $ 11,287 $ 47,917 $ (21,004 ) $ 26,913 September 30, 2018 December 31, 2017 Indefinite-lived Estimated Useful Life Gross Accumulated Amortization Net Gross Accumulated Amortization Net Domain Indefinite $ 2,200 $ — $ 2,200 $ 2,200 $ — $ 2,200 |
Amortization expense for the remainder of the year and for the next four years | Amortization Expense Year (in thousands) 2018 $ 1,511 2019 4,872 2020 2,371 2021 1,499 2022 902 Thereafter 132 $ 11,287 |
Goodwill | (in thousands) Goodwill as of December 31, 2017 $ 5,133 Impairment charge (5,133 ) Goodwill as of September 30, 2018 $ — |
Organization and Operations (De
Organization and Operations (Details Narrative) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
State of incorporation | Delaware |
Date of incorporation | May 17, 1996 |
Trading Symbol | AUTO |
Date of acquisition/merger | Dec. 31, 2016 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue from contracts with customers | $ 31,695 | $ 36,872 | $ 93,336 | $ 108,804 |
Lead Fees [Member] | ||||
Revenue from contracts with customers | 24,986 | 27,711 | 71,277 | 83,149 |
Click Advertising [Member] | ||||
Revenue from contracts with customers | 5,559 | 7,436 | 18,020 | 20,403 |
Display and Other Advertising [Member] | ||||
Revenue from contracts with customers | 1,047 | 1,510 | 3,623 | 4,511 |
Other Revenues [Member] | ||||
Revenue from contracts with customers | $ 103 | $ 215 | $ 416 | $ 741 |
Net Earnings (Loss) Per Share_3
Net Earnings (Loss) Per Share and Stockholders’ Equity (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Basic Shares: | ||||
Weighted average common shares outstanding | 12,948,150 | 12,881,812 | 12,959,666 | 11,729,181 |
Weighted average unvested restricted stock | (161,413) | (119,584) | (249,084) | (115,574) |
Weighted average common shares repurchased | 0 | (60,230) | 0 | (20,297) |
Basic shares | 12,786,737 | 12,701,998 | 12,710,582 | 11,593,310 |
Diluted Shares: | ||||
Basic shares | 12,786,737 | 12,701,998 | 12,710,582 | 11,593,310 |
Weighted average dilutive securities | 0 | 498,587 | 0 | 621,449 |
Incremental shares from convertible preferred stock | 0 | 0 | 0 | 1,064,660 |
Dilutive Shares | 12,786,737 | 13,200,585 | 12,710,582 | 13,279,419 |
Net Earnings (Loss) Per Share_4
Net Earnings (Loss) Per Share and Stockholders’ Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 27, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Dilutive Shares: | |||||
Authorized amount of stock repurchase, minimum | $ 3,000 | $ 3,000 | |||
Anti-dilutive potential shares of common stock | 4,200,000 | 3,900,000 | 4,300,000 | 3,100,000 | |
Warrant | |||||
Exercise price of warrant (in dollars per share) | $ 18.45 | ||||
AWI Warrant | |||||
Warrant | |||||
Warrant issued | 148,240 | ||||
Warrant price (in dollars per share) | $ 1.72 | $ 1.72 | |||
Auto USA | |||||
Warrant | |||||
Warrant price (in dollars per share) | $ 7.35 | $ 7.35 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based compensation expense: | ||||
Share-based compensation costs | $ 1,796 | $ 964 | $ 4,366 | $ 2,920 |
Amount capitalized to internal use software | 0 | 1 | 1 | 2 |
Total share-based compensation costs | 1,796 | 963 | 4,365 | 2,918 |
Cost of revenues [Member] | ||||
Share-based compensation expense: | ||||
Share-based compensation costs | 2 | 20 | 21 | 59 |
Sales and marketing [Member] | ||||
Share-based compensation expense: | ||||
Share-based compensation costs | 520 | 409 | 904 | 1,222 |
Technology support [Member] | ||||
Share-based compensation expense: | ||||
Share-based compensation costs | 886 | 138 | 1,213 | 401 |
General and administrative [Member] | ||||
Share-based compensation expense: | ||||
Share-based compensation costs | $ 388 | $ 397 | $ 2,228 | $ 1,238 |
Share-Based Compensation (Det_2
Share-Based Compensation (Details 1) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Stock Issued or Granted During Period, Share-based Compensation | ||||
Number of service-based options granted | 33,000 | 83,850 | 1,749,700 | 457,100 |
Weighted average grant date fair value | $ 1.65 | $ 3.72 | $ 1.83 | $ 6.29 |
Weighted average exercise price | $ 3.04 | $ 7.23 | $ 3.29 | $ 12.51 |
Share-Based Compensation (Det_3
Share-Based Compensation (Details 2) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Number of stock options exercised | 1,000 | 15,000 | 16,967 | 191,074 |
Weighted average exercise price | $ 1.75 | $ 4.20 | $ 4.51 | $ 3.58 |
Share-Based Compensation (Det_4
Share-Based Compensation (Details 3) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Fair value of stock options granted using the following weighted average assumptions | ||||
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Volatility | 66.00% | 63.00% | 68.00% | 62.00% |
Risk-free interest rate | 2.90% | 1.80% | 2.60% | 1.80% |
Expected life | 4 years 6 months | 4 years 4 months 24 days | 4 years 6 months | 4 years 4 months 24 days |
Investments (Details Narrative)
Investments (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Dec. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Cash receipts from sale of investment in SaleMove | $ 125 | $ 0 | |
SaleMove Inc [Member] | |||
Impairment charge | $ 600 | ||
Due from affiliates | $ 364 |
Selected Balance Sheet Accoun_3
Selected Balance Sheet Accounts (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Property and Equipment | ||
Computer software and hardware | $ 11,585 | $ 11,065 |
Capitalized internal use software | 5,977 | 5,774 |
Furniture and equipment | 1,743 | 1,703 |
Leasehold improvements | 1,605 | 1,539 |
Property and equipment, gross | 20,910 | 20,081 |
Less - Accumulated depreciation and amortization | (17,296) | (15,770) |
Property and equipment, net | $ 3,614 | $ 4,311 |
Selected Balance Sheet Accoun_4
Selected Balance Sheet Accounts (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Accrued expenses and other current liabilities | ||
Other accrued expenses | $ 7,154 | $ 6,307 |
Amounts due to customers | 392 | 438 |
Other current liabilities | 437 | 507 |
Total other accrued expenses and other current liabilities | $ 7,983 | $ 7,252 |
Selected Balance Sheet Accoun_5
Selected Balance Sheet Accounts (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Property, Plant and Equipment [Line Items] | ||||
Impairment charge | $ 0 | $ 0 | $ 5,133 | $ 0 |
Sales Revenue Net [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Concentration risk | 42.00% | 33.00% | ||
Accounts Receivable [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Concentration risk | 51.00% | 43.00% | ||
Concentration risk, amount | $ 13,200 | $ 12,200 |
Long-Lived Assets and Impairm_3
Long-Lived Assets and Impairment (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Intangible Assets | ||
Gross | $ 47,917 | $ 47,917 |
Accumulated Amortization | (36,630) | (21,004) |
Net | 13,487 | 29,113 |
Trademarks and Trade Names [Member] | ||
Intangible Assets | ||
Gross | 16,589 | 6,589 |
Accumulated Amortization | (14,734) | (4,037) |
Net | $ 1,855 | 12,552 |
Trademarks and Trade Names [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 3 years | |
Trademarks and Trade Names [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 7 years | |
Developed Technology Rights [Member] | ||
Intangible Assets | ||
Gross | $ 8,955 | 8,955 |
Accumulated Amortization | (4,601) | (3,619) |
Net | $ 4,354 | 5,336 |
Developed Technology Rights [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 5 years | |
Developed Technology Rights [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 7 years | |
Customer Relationships [Member] | ||
Intangible Assets | ||
Gross | $ 19,563 | 19,563 |
Accumulated Amortization | (14,485) | (10,555) |
Net | $ 5,078 | 9,008 |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 2 years | |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 10 years | |
Software and publications [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 3 years | |
Intangible Assets | ||
Gross | $ 1,300 | 1,300 |
Accumulated Amortization | (1,300) | (1,300) |
Net | 0 | 0 |
Employment/non-compete agreements [Member] | ||
Intangible Assets | ||
Gross | 1,510 | 1,510 |
Accumulated Amortization | (1,510) | (1,493) |
Net | $ 0 | 17 |
Employment/non-compete agreements [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 1 year | |
Employment/non-compete agreements [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets | ||
Estimated Useful Life | 5 years | |
Domain [Member] | ||
Intangible Assets | ||
Gross | $ 2,200 | 2,200 |
Accumulated Amortization | 0 | 0 |
Net | $ 2,200 | $ 2,200 |
Long-Lived Assets and Impairm_4
Long-Lived Assets and Impairment (Details 1) $ in Thousands | Sep. 30, 2018USD ($) |
Amortization expense for the remainder of the year and for the next five years | |
2,018 | $ 1,511 |
2,019 | 4,872 |
2,020 | 2,371 |
2,021 | 1,499 |
2,022 | 902 |
Thereafter | 132 |
Total | $ 11,287 |
Long-Lived Assets and Impairm_5
Long-Lived Assets and Impairment (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Goodwill | ||||
Goodwill, beginning of period | $ 5,133 | |||
Impairment charge | $ 0 | $ 0 | (5,133) | $ 0 |
Goodwill, end of period | $ 0 | $ 0 |
Credit Facility (Details Narrat
Credit Facility (Details Narrative) $ in Thousands | Sep. 30, 2018USD ($) |
Term loan balance | $ 0 |
Revolving loan limit | 8,000 |
Term Loan 1 | |
Term loan | 9,000 |
Term Loan 2 | |
Term loan | $ 15,000 |