Exhibit 99.1
InfoSpace Announces Strong Second Quarter 2008 Results
BELLEVUE, Wash. (August 5, 2008) – InfoSpace, Inc. (NASDAQ: INSP) today announced financial results for the three months ended June 30, 2008.
“We achieved higher-than-expected revenue and Adjusted EBITDA in the second quarter,” said Jim Voelker, chairman and chief executive officer of InfoSpace, Inc. “Much of our success can be attributed to growth in our owned-and-operated properties, demonstrating the progress the team has made in executing the Company’s new initiatives. As we look toward the remainder of the year, we are optimistic about our ability to grow profitably.”
Revenues for the second quarter of 2008 were $38.3 million, reflecting a $6.6 million or 21% increase over the second quarter of 2007.
Income from continuing operations was $2.7 million in the second quarter of 2008, compared to a loss from continuing operations of $21.0 million in the second quarter of 2007. Adjusted EBITDA from continuing operations was $9.7 million in the second quarter of 2008, compared to Adjusted EBITDA from continuing operations of a negative $15.2 million in the second quarter of 2007.
Net income for the second quarter of 2008 was $1.9 million or $0.06 per diluted share versus a net loss of $28.1 million or $0.86 per share in the second quarter of 2007. Net income in the second quarter of 2008 includes an impairment charge of $4.4 million on the Company’s investments in auction rate securities.
Cash, cash equivalents, and marketable securities as of June 30, 2008 totaled $218.5 million, which includes an investment of $27.2 million in auction rate securities.
Second Quarter Highlights and Recent Developments
InfoSpace:
| | • | | Entered into a partnership with Petfinder.com, the largest searchable site of pets in need of homes, to provide easy access for their users to Dogpile’s web search and downloadable products; |
| | • | | Released a new search widget featuring Dogpile’s mascot Arfie that provides an interactive desktop pal, a customized search bar, and access to SearchSpy; |
| | • | | Signed five new distribution partners and two contract extensions with existing customers; and |
| | • | | Reauthorized a repurchase of up to $100 million of the Company’s outstanding shares of common stock over the next twelve months. |
Third Quarter and Full Year Outlook
For the third quarter of 2008, the Company expects revenue to be between $37 million and $39 million. Additionally, the Company expects Adjusted EBITDA from continuing operations to be between $4 million and $5 million and net income (loss) to be between net loss of $500 thousand and net income of $500 thousand, or negative $0.01 and positive $0.01 per share.
For the full year 2008, the Company expects revenue to be between $156 million and $160 million. Additionally, the Company expects Adjusted EBITDA from continuing operations to be between $26 million and $28 million and net income (loss) to be between net loss of $500 thousand and net income of $1 million, or negative $0.01 and positive $0.03 per share.
A conference call will be held today at 2 p.m. Pacific/ 5 p.m. Eastern. The live Webcast can be accessed in the Investor Relations section of the InfoSpace corporate Web site, athttp://www.infospaceinc.com. A replay of the call will be available approximately one hour after the call through August 12, 2008 at 9:00 p.m. Pacific/ 12:00 a.m. Eastern.
Non-GAAP Financial Measures
InfoSpace’s Adjusted EBITDA from continuing operations is calculated by adjusting GAAP net income (loss) to exclude the effects of discontinued operations, income taxes, depreciation, stock-based compensation expense, gain (loss) on investments, net, and other income, net (typically including such items as interest income, foreign currency gains or losses, and gains or losses from the disposal of assets), as detailed in the accompanying table to the preliminary condensed consolidated financial statements.
InfoSpace’s management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding certain expenses and gains that are not indicative of our core business operating results. InfoSpace believes that management and the investors benefit from referring to this non-GAAP financial measure in assessing InfoSpace’s performance. Adjusted EBITDA from continuing operations should be evaluated in light of the Company’s financial results prepared in accordance with GAAP. A table reconciling the Company’s Adjusted EBITDA from continuing operations to net income (loss) in accordance with GAAP accompanies the preliminary condensed consolidated financial statements in this release.
About InfoSpace, Inc.
InfoSpace, Inc., a leading developer of metasearch products, is focused on bringing the best of the Web to Internet users. InfoSpace’s proprietary metasearch technology combines the top results from several of the largest online search engines, providing fast and comprehensive search results on InfoSpace sites including Dogpile (www.dogpile.com) and WebFetch (www.webfetch.com). For the second consecutive year, JD Power and Associates ranked Dogpile highest in customer satisfaction among search engines. InfoSpace’s metasearch technology is also available on more than 100 partner sites, including content, community and connectivity sites. More information can be found atwww.infospaceinc.com.
###
Source: InfoSpace, Inc.
For more information, contact:
Stacy Ybarra, InfoSpace
425.709.8127
stacy.ybarra@infospace.com
This release contains forward-looking statements relating to InfoSpace, Inc.’s operating results that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words “believe,” “expect,” “intend,” “anticipate,” variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward looking. Forward-looking statements include, without limitation, statements regarding optimism for strong growth and profitability to continue and our financial performance for the third quarter and full year 2008. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect InfoSpace’s actual results include general economic, industry and market sector conditions, the progress and costs of the development of our products and services, the timing and extent of market acceptance of those products and services, our dependence on companies to distribute our products and services, the ability to successfully integrate acquired businesses, the successful execution of the Company’s strategic initiatives and restructuring plans, and the condition of our cash investments. A more detailed description of certain factors that could affect actual results include, but are not limited to, those discussed in InfoSpace’s most recent Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q as filed from time to time, in the section entitled “Risk Factors.” Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. InfoSpace undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
InfoSpace, Inc.
Preliminary Condensed Consolidated Statements of Operations(1)
(Unaudited)
(Amounts in thousands, except per share data)
| | | | | | | | | | | | | | | | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Revenues | | $ | 38,328 | | | $ | 31,763 | | | $ | 80,510 | | | $ | 67,627 | |
Operating expenses: (2) | | | | | | | | | | | | | | | | |
Content and distribution | | | 18,062 | | | | 12,597 | | | | 39,854 | | | | 27,545 | |
Systems and network operations | | | 2,774 | | | | 2,406 | | | | 5,216 | | | | 4,685 | |
Product development | | | 2,929 | | | | 2,484 | | | | 5,138 | | | | 4,763 | |
Sales and marketing | | | 6,041 | | | | 6,665 | | | | 9,830 | | | | 11,490 | |
General and administrative | | | 4,960 | | | | 29,557 | | | | 12,682 | | | | 39,199 | |
Depreciation | | | 1,731 | | | | 1,273 | | | | 3,218 | | | | 2,656 | |
Restructuring and other, net(3) | | | (2,011 | ) | | | (1,669 | ) | | | (1,871 | ) | | | (2,502 | ) |
| | | | | | | | | | | | | | | | |
Total operating expenses | | | 34,486 | | | | 53,313 | | | | 74,067 | | | | 87,836 | |
| | | | | | | | | | | | | | | | |
Operating income (loss) | | | 3,842 | | | | (21,550 | ) | | | 6,443 | | | | (20,209 | ) |
Gain (loss) on investments, net | | | (4,362 | ) | | | 65 | | | | (11,069 | ) | | | 65 | |
Other income, net | | | 2,654 | | | | 4,360 | | | | 4,897 | | | | 9,685 | |
| | | | | | | | | | | | | | | | |
Income (loss) from continuing operations before income taxes | | | 2,134 | | | | (17,125 | ) | | | 271 | | | | (10,459 | ) |
Income tax benefit (expense) | | | 577 | | | | (3,894 | ) | | | 395 | | | | (6,969 | ) |
| | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | | 2,711 | | | | (21,019 | ) | | | 666 | | | | (17,428 | ) |
| | | | | | | | | | | | | | | | |
Discontinued operations:(1) | | | | | | | | | | | | | | | | |
Loss from discontinued operations, net of taxes | | | (821 | ) | | | (7,111 | ) | | | (1,311 | ) | | | (11,242 | ) |
Gain (loss) on sale of discontinued operations, net of taxes | | | 43 | | | | — | | | | (195 | ) | | | — | |
| | | | | | | | | | | | | | | | |
Net income (loss) | | $ | 1,933 | | | $ | (28,130 | ) | | $ | (840 | ) | | $ | (28,670 | ) |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share - Basic | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | $ | 0.08 | | | $ | (0.64 | ) | | $ | 0.02 | | | $ | (0.54 | ) |
Loss from discontinued operations | | | (0.02 | ) | | | (0.22 | ) | | | (0.04 | ) | | | (0.35 | ) |
Gain (loss) on sale of discontinued operations | | | 0.00 | | | | — | | | | 0.00 | | | | — | |
| | | | | | | | | | | | | | | | |
Net income (loss) per share - Basic | | $ | 0.06 | | | $ | (0.86 | ) | | $ | (0.02 | ) | | $ | (0.89 | ) |
| | | | | | | | | | | | | | | | |
Weighted average shares outstanding used in computing basic income (loss) per share | | | 34,334 | | | | 32,626 | | | | 34,316 | | | | 32,047 | |
| | | | | | | | | | | | | | | | |
Earnings (loss) per share - Diluted | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | $ | 0.08 | | | $ | (0.64 | ) | | $ | 0.02 | | | $ | (0.54 | ) |
Loss from discontinued operations | | | (0.02 | ) | | | (0.22 | ) | | | (0.04 | ) | | | (0.35 | ) |
Gain (loss) on sale of discontinued operations | | | 0.00 | | | | — | | | | 0.00 | | | | — | |
| | | | | | | | | | | | | | | | |
Net income (loss) per share - Diluted | | $ | 0.06 | | | $ | (0.86 | ) | | $ | (0.02 | ) | | $ | (0.89 | ) |
| | | | | | | | | | | | | | | | |
Weighted average shares outstanding used in computing diluted income (loss) per share | | | 34,755 | | | | 32,626 | | | | 34,628 | | | | 32,047 | |
| | | | | | | | | | | | | | | | |
(1) | In 2007, the Company completed the sale of its directory business. The operating results of the directory business have been presented as discontinued operations for all periods presented. Amounts include stock-based compensation expense of $7,000 and $52,000 for the three and six months ended June 30, 2008, respectively. Amounts include stock-based compensation expense of $0.4 million and $0.9 million for the three and six months ended June 30, 2007, respectively. Income tax expense related to discontinued operations was $5,000 and $4,000 for the three and six months ended June 30, 2008, respectively and $1.3 million and $3.1 million for the three and six months ended June 30, 2007, respectively. A gain, net of taxes of $1,000, was recorded on the sale of the directory business in the three and six months ended June 30, 2008. Revenue, operating expenses and income taxes, income (loss) and the gain on sale of these discontinued operations are presented below (in thousands): |
| | | | | | | | | | | | | | | | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Directory | | | | | | | | | | | | | | | | |
Revenue | | $ | — | | | $ | 7,979 | | | $ | — | | | $ | 17,154 | |
Operating expenses and income taxes | | | 12 | | | | 5,660 | | | | (200 | ) | | | 12,351 | |
| | | | | | | | | | | | | | | | |
Income (loss) from discontinued operations, net of taxes | | $ | (12 | ) | | $ | 2,319 | | | $ | 200 | | | $ | 4,803 | |
| | | | | | | | | | | | | | | | |
Gain on sale of discontinued operations, net of taxes | | $ | 81 | | | $ | — | | | $ | 66 | | | $ | — | |
| | | | | | | | | | | | | | | | |
In 2007, the Company completed the sale of its mobile services business. The operating results of the mobile services business have been presented as discontinued operations for all periods presented. Amounts include stock-based compensation expense of $77,000 and $89,000 for the three and six months ended June 30, 2008, respectively, and stock-based compensation expense of $3.4 million and $5.7 million for the three and six months ended June 30, 2007, respectively. Income taxes related to discontinued operations were a benefit of $0.1 million and an expense of $86,000 for the three and six months ended June 30, 2008, respectively, and a benefit of $5.4 million and $9.3 million for the three and six months ended June 30, 2007, respectively. A loss, net of a tax benefit of $10,000 and $0.2 million, on the sale of the mobile services business was recorded in the three and six months ended June 30, 2008. Revenue, operating expenses and income taxes, loss and the loss on sale of these discontinued operations are presented below (in thousands): | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Mobile | | | | | | | | | | | | | | | | |
Revenue | | $ | 53 | | | $ | 30,788 | | | $ | 80 | | | $ | 72,392 | |
Operating expenses and income taxes | | | 862 | | | | 40,218 | | | | 1,591 | | | | 88,437 | |
| | | | | | | | | | | | | | | | |
Loss from discontinued operations, net of taxes | | $ | (809 | ) | | $ | (9,430 | ) | | $ | (1,511 | ) | | $ | (16,045 | ) |
| | | | | | | | | | | | | | | | |
Loss on sale of discontinued operations, net of taxes | | $ | (38 | ) | | $ | — | | | $ | (261 | ) | | $ | — | |
| | | | | | | | | | | | | | | | |
(2) Stock-based compensation expense for the three and six months ended June 30, 2008 and 2007 is allocated among the following captions (in thousands): | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Systems and network operations | | $ | 446 | | | $ | 264 | | | $ | 813 | | | $ | 465 | |
Product development | | | 1,047 | | | | 616 | | | | 1,640 | | | | 1,185 | |
Sales and marketing | | | 1,038 | | | | 1,390 | | | | 1,891 | | | | 2,702 | |
General and administrative | | | 1,643 | | | | 2,809 | | | | 2,857 | | | | 5,134 | |
| | | | | | | | | | | | | | | | |
Total stock-based compensation expense | | $ | 4,174 | | | $ | 5,079 | | | $ | 7,201 | | | $ | 9,486 | |
| | | | | | | | | | | | | | | | |
(3) Amounts for the three and six months ended June 30, 2008 consist of gains on the sale of certain non-core assets of $1.9 million, and amounts for the three and six months ended June 30, 2007 consist of gains on sale of assets related to the mobile media operations of $2.1 million and $3.3 million, respectively. Restructuring charges are comprised of the following (in thousands): | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Employee separation | | $ | (26 | ) | | $ | 472 | | | $ | 54 | | | $ | 361 | |
Stock-based compensation expense | | | — | | | | 86 | | | | 60 | | | | (68 | ) |
Contractual commitments | | | (88 | ) | | | 61 | | | | (88 | ) | | | 473 | |
Estimated future lease losses | | | — | | | | (370 | ) | | | — | | | | (84 | ) |
Other | | | — | | | | 129 | | | | — | | | | 129 | |
| | | | | | | | | | | | | | | | |
| | $ | (114 | ) | | $ | 378 | | | $ | 26 | | | $ | 811 | |
| | | | | | | | | | | | | | | | |
InfoSpace, Inc.
Preliminary Condensed Consolidated Balance Sheets
(Unaudited)
(Amounts in thousands)
| | | | | | | | |
| | | June 30,
2008 | | | December 31,
2007 | |
ASSETS | | | | | | | | |
Current assets: | | | | | | | | |
Cash and cash equivalents | | $ | 161,624 | | | $ | 498,326 | |
Short-term investments, available-for-sale | | | 29,690 | | | | 39,019 | |
Accounts receivable, net | | | 16,155 | | | | 17,081 | |
Notes and other receivables | | | 944 | | | | 7,104 | |
Prepaid expenses and other current assets | | | 1,788 | | | | 1,902 | |
Assets of discontinued operations | | | 25 | | | | 4,730 | |
| | | | | | | | |
Total current assets | | | 210,226 | | | | 568,162 | |
Property and equipment, net | | | 18,239 | | | | 10,945 | |
Long-term investments, available-for-sale | | | 27,179 | | | | 37,472 | |
Goodwill and other intangible assets, net | | | 44,123 | | | | 44,123 | |
Other long-term assets | | | 9,283 | | | | 10,722 | |
| | | | | | | | |
Total assets | | $ | 309,050 | | | $ | 671,424 | |
| | | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | |
Current liabilities: | | | | | | | | |
Accounts payable | | $ | 7,104 | | | $ | 5,148 | |
Accrued expenses and other current liabilities | | | 24,336 | | | | 78,703 | |
Special dividend payable | | | — | | | | 299,296 | |
Liabilities of discontinued operations | | | 3,114 | | | | 21,753 | |
| | | | | | | | |
Total current liabilities | | | 34,554 | | | | 404,900 | |
Other long-term liabilities | | | 1,481 | | | | 634 | |
| | | | | | | | |
Total liabilities | | | 36,035 | | | | 405,534 | |
Stockholders’ equity: | | | | | | | | |
Common stock | | | 3 | | | | 3 | |
Additional paid-in capital | | | 1,293,348 | | | | 1,286,219 | |
Accumulated deficit | | | (1,021,874 | ) | | | (1,021,034 | ) |
Accumulated other comprehensive income | | | 1,538 | | | | 702 | |
| | | | | | | | |
Total stockholders’ equity | | | 273,015 | | | | 265,890 | |
| | | | | | | | |
Total liabilities and stockholders’ equity | | $ | 309,050 | | | $ | 671,424 | |
| | | | | | | | |
Summary of cash, short-term and long-term investments: | | | | | | | | |
Cash and cash equivalents | | $ | 161,624 | | | $ | 498,326 | |
Short-term investments, available-for-sale | | | 29,690 | | | | 39,019 | |
Long-term investments, available-for-sale | | | 27,179 | | | | 37,472 | |
| | | | | | | | |
Cash, short-term and long-term investments | | $ | 218,493 | | | $ | 574,817 | |
| | | | | | | | |
InfoSpace, Inc.
Preliminary Condensed Consolidated Statements of Cash Flows
(Unaudited)
(Amounts in thousands)
| | | | | | | | |
| | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | |
Operating activities: | | | | | | | | |
Net loss | | $ | (840 | ) | | $ | (28,670 | ) |
Adjustments to reconcile net loss to net cash used by operating activities: | | | | | | | | |
Loss from discontinued operations | | | 1,311 | | | | 17,428 | |
Loss on sale of discontinued operations | | | 195 | | | | — | |
Loss on investments | | | 11,069 | | | | — | |
Stock-based compensation | | | 7,201 | | | | 9,486 | |
Depreciation | | | 3,218 | | | | 2,947 | |
Restructuring | | | 26 | | | | 811 | |
Deferred income taxes | | | (819 | ) | | | 800 | |
Net gain on sale of non-core assets | | | (1,897 | ) | | | (3,313 | ) |
Other | | | 40 | | | | (36 | ) |
Cash provided (used) by changes in operating assets and liabilities: | | | | | | | | |
Accounts receivable | | | 847 | | | | (2,359 | ) |
Notes and other receivables | | | 5,741 | | | | 1,847 | |
Prepaid expenses and other current assets | | | 114 | | | | 83 | |
Other long-term assets | | | 2,442 | | | | 135 | |
Accounts payable | | | (991 | ) | | | (5,169 | ) |
Accrued expenses and other current and long-term liabilities | | | (55,030 | ) | | | (9,971 | ) |
| | | | | | | | |
Net cash used by operating activities | | | (27,373 | ) | | | (15,981 | ) |
Investing activities: | | | | | | | | |
Purchases of property and equipment | | | (5,715 | ) | | | (4,173 | ) |
Other long-term assets | | | (1,003 | ) | | | — | |
Loan to equity investee | | | — | | | | (2,000 | ) |
Proceeds from the sale of assets | | | 2,316 | | | | 2,223 | |
Proceeds from sales and maturities of investments | | | 27,300 | | | | 225,480 | |
Purchases of investments | | | (17,984 | ) | | | (74,523 | ) |
| | | | | | | | |
Net cash provided by investing activities | | | 4,914 | | | | 147,007 | |
Financing activities: | | | | | | | | |
Special dividend paid | | | (299,146 | ) | | | (208,203 | ) |
Proceeds from stock option and warrant exercises | | | 15 | | | | 12,756 | |
Proceeds from issuance of stock through employee stock purchase plan | | | 219 | | | | 741 | |
Repayment of capital lease obligations | | | (32 | ) | | | — | |
| | | | | | | | |
Net cash used by financing activities | | | (298,944 | ) | | | (194,706 | ) |
Discontinued operations: | | | | | | | | |
Net cash provided (used) by operating activities attributable to discontinued operations | | | (15,299 | ) | | | 20,839 | |
Net cash used by investing activities attributable to discontinued operations | | | — | | | | (9,674 | ) |
| | | | | | | | |
Net cash provided (used) by discontinued operations | | | (15,299 | ) | | | 11,165 | |
| | | | | | | | |
Net decrease in cash and cash equivalents | | | (336,702 | ) | | | (52,515 | ) |
Cash and cash equivalents: | | | | | | | | |
Beginning of period | | | 498,326 | | | | 162,387 | |
| | | | | | | | |
End of period | | $ | 161,624 | | | $ | 109,872 | |
| | | | | | | | |
InfoSpace, Inc.
Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measure
Preliminary Adjusted EBITDA from Continuing Operations Reconciliation(1)
(Unaudited)
(Amounts in thousands)
| | | | | | | | | | | | | | | | |
| | | Three months ended | | | Six months ended | |
| | | June 30,
2008 | | | June 30,
2007 | | | June 30,
2008 | | | June 30,
2007 | |
Net income (loss)(2) | | $ | 1,933 | | | $ | (28,130 | ) | | $ | (840 | ) | | $ | (28,670 | ) |
Discontinued operations | | | 778 | | | | 7,111 | | | | 1,506 | | | | 11,242 | |
Depreciation | | | 1,731 | | | | 1,273 | | | | 3,218 | | | | 2,656 | |
Stock-based compensation | | | 4,174 | | | | 5,079 | | | | 7,201 | | | | 9,486 | |
Loss (gain) on investments, net | | | 4,362 | | | | (65 | ) | | | 11,069 | | | | (65 | ) |
Other income, net(3) | | | (2,654 | ) | | | (4,360 | ) | | | (4,897 | ) | | | (9,685 | ) |
Income tax expense (benefit) | | | (577 | ) | | | 3,894 | | | | (395 | ) | | | 6,969 | |
| | | | | | | | | | | | | | | | |
Adjusted EBITDA from continuing operations | | $ | 9,747 | | | $ | (15,198 | ) | | $ | 16,862 | | | $ | (8,067 | ) |
| | | | | | | | | | | | | | | | |
Preliminary Adjusted EBITDA from Continuing Operations Reconciliation for Forward-Looking Guidance (Amounts in thousands) | |
| | | Ranges for the three months ending
September 30, 2008 | | | Ranges for the year ending
December 31, 2008 | |
Net income (loss) | | $ | (500 | ) | | $ | 500 | | | $ | (500 | ) | | $ | 1,000 | |
Discontinued operations | | | — | | | | — | | | | 1,500 | | | | 1,500 | |
Depreciation | | | 2,000 | | | | 2,000 | | | | 7,400 | | | | 7,500 | |
Stock-based compensation | | | 3,900 | | | | 3,900 | | | | 14,700 | | | | 14,900 | |
Loss on investments, net | | | — | | | | — | | | | 11,600 | | | | 11,600 | |
Other income, net(3) | | | (1,420 | ) | | | (1,600 | ) | | | (8,400 | ) | | | (8,600 | ) |
Income tax expense (benefit) | | | 20 | | | | 200 | | | | (300 | ) | | | 100 | |
| | | | | | | | | | | | | | | | |
Adjusted EBITDA from continuing operations | | $ | 4,000 | | | $ | 5,000 | | | $ | 26,000 | | | $ | 28,000 | |
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(1) | Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”) from continuing operations is a non-GAAP financial measure and is reconciled to net income (loss), which the Company’s management believes to be the most comparable generally accepted accounting principles (“GAAP”) measure. Adjusted EBITDA from continuing operations results are calculated by adjusting GAAP net income (loss) to exclude the effects of discontinued operations, income taxes, depreciation, stock-based compensation expense, gain (loss) on investments, net, and other income, net (including such items as interest income, litigation settlements and contingencies, foreign currency gains or losses, and gains or losses from the disposal of assets), as detailed above. This calculation excludes the directory and mobile businesses, because they have been classified as discontinued operations in all periods presented. The Company uses this non-GAAP financial measure for internal management purposes, when publicly providing guidance on possible future results, and as a means to evaluate period-to-period comparisons. The Company’s management believes that this non-GAAP financial measure is a common measure used by investors and analysts to evaluate its performance. This non-GAAP financial measure is used in addition to and in conjunction with results presented in accordance with GAAP and reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provide a more complete understanding of the results of operations and trends affecting the Company’s business. This non-GAAP financial measure should be considered as a supplement to, and not as a substitute for, or superior to, net income (loss) in accordance with GAAP. |
(2) | As presented in the preliminary unaudited Condensed Consolidated Statements of Operations. |
(3) | Other income, net, typically consists of interest income, gains or losses from the disposal of assets, and foreign currency transaction gains or losses. |
