Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 06, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Sizmek Inc. | |
Entity Central Index Key | 1,591,877 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 29,118,526 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 40,288 | $ 42,046 |
Accounts receivable (less allowances of $1,736 as of March 31, 2016 and $1,795 as of December 31, 2015) | 52,210 | 64,595 |
Restricted cash | 1,581 | 1,538 |
Other current assets | 3,908 | 4,568 |
Current assets of TV business | 284 | 678 |
Total current assets | 98,271 | 113,425 |
Property and equipment, net | 32,115 | 29,410 |
Goodwill | 9,337 | 8,411 |
Intangible assets, net | 16,158 | 16,931 |
Deferred income taxes | 511 | 523 |
Restricted cash | 4,208 | 4,478 |
Other non-current assets | 5,758 | 4,807 |
Total assets | 166,358 | 177,985 |
CURRENT LIABILITIES: | ||
Accounts payable | 5,732 | 3,683 |
Accrued liabilities | 33,127 | 39,037 |
Current liabilities of TV business | 424 | 1,203 |
Total current liabilities | 39,283 | 43,923 |
Deferred income taxes | 848 | 919 |
Other non-current liabilities | 8,239 | $ 7,613 |
Non-current liabilities of TV business | ||
Total liabilities | $ 48,370 | $ 52,455 |
STOCKHOLDERS' EQUITY: | ||
Preferred stock, $0.001 par value-Authorized 15,000 shares; issued and outstanding-none | ||
Common stock, $0.001 par value-Authorized 200,000 shares; 29,118 issued and outstanding at March 31, 2016; 29,584 issued and 29,228 outstanding at December 31, 2015 | $ 29 | $ 30 |
Treasury stock, at cost (356 shares at December 31, 2015) | (1,510) | |
Additional capital | $ 366,580 | 368,658 |
Accumulated deficit | (245,241) | (238,289) |
Accumulated other comprehensive loss | (3,380) | (3,359) |
Total stockholders' equity | 117,988 | 125,530 |
Total liabilities and stockholders' equity | $ 166,358 | $ 177,985 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 1,736 | $ 1,795 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, Authorized shares | 15,000 | 15,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, Authorized shares | 200,000 | 200,000 |
Common stock, issued shares | 29,118 | 29,584 |
Common stock, outstanding shares | 29,118 | 29,228 |
Treasury stock, shares | 0 | 356 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues: | ||
Platform solutions | $ 34,430 | $ 32,892 |
Programmatic solutions | 6,095 | 3,867 |
Total | 40,525 | 36,759 |
Cost of revenues (excluding depreciation and amortization): | ||
Platform solutions | 13,664 | 10,835 |
Programmatic solutions | 4,587 | 2,825 |
Total | 18,251 | 13,660 |
Selling and marketing | 14,822 | 14,203 |
Research and development | 3,209 | 2,903 |
General and administrative | 5,556 | 4,554 |
Merger, integration, and other | 2,768 | 834 |
Depreciation and amortization | 2,922 | 7,439 |
Loss from operations | (7,003) | (6,834) |
Other (income) expense, net | (526) | 979 |
Loss before income taxes | (6,477) | (7,813) |
Provision for income taxes | 475 | 132 |
Net loss | $ (6,952) | $ (7,945) |
Basic and diluted loss per common share | $ (0.24) | $ (0.27) |
Weighted average common shares outstanding: | ||
Basic and diluted | 29,034 | 29,783 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (6,952) | $ (7,945) |
Other comprehensive gain (loss): | ||
Unrealized gain (loss) on derivatives, net of tax | 251 | (95) |
Unrealized gain (loss) on available for sale securities, net of tax | 23 | (228) |
Foreign currency translation adjustment | (295) | (804) |
Total other comprehensive loss | (21) | (1,127) |
Total comprehensive loss | $ (6,973) | $ (9,072) |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - 3 months ended Mar. 31, 2016 - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Treasury Stock [Member] | Additional Paid In Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Total |
Balance at Dec. 31, 2015 | $ 30 | $ (1,510) | $ 368,658 | $ (238,289) | $ (3,359) | $ 125,530 |
Balance, shares at Dec. 31, 2015 | 29,584 | (356) | ||||
Net loss | $ (6,952) | (6,952) | ||||
Share-based compensation | $ 867 | 867 | ||||
Common stock issued pursuant to RSU agreements, net of shares tendered to satisfy required tax withholding | $ (159) | (159) | ||||
Common stock issued pursuant to RSU agreements, net of shares tendered to satisfy required tax withholding, shares | 273 | |||||
Purchase of treasury stock | $ 1,277 | $ (1,277) | ||||
Purchase of treasury stock, shares | 383 | |||||
Retirement of treasury stock | $ (1) | $ 2,787 | $ (2,786) | |||
Retirement of treasury stock, shares | (739) | 739 | ||||
Other comprehensive loss | $ (21) | $ (21) | ||||
Balance at Mar. 31, 2016 | $ 29 | $ 366,580 | $ (245,241) | $ (3,380) | $ 117,988 | |
Balance, shares at Mar. 31, 2016 | 29,118 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (6,952) | $ (7,945) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation of property and equipment | 1,458 | 3,553 |
Amortization of intangibles | 1,464 | 3,886 |
Share-based compensation | 867 | 846 |
Deferred income taxes | (75) | (327) |
Provision for trade receivable losses | (59) | (60) |
Gain (loss) from recovery of TV business net assets | 149 | (114) |
Changes in operating assets and liabilities: | ||
Accounts receivables | 12,453 | 7,938 |
Other assets | 412 | (2,241) |
Accounts payable and other liabilities | (4,071) | (2,195) |
Net cash provided by operating activities | 5,646 | 3,341 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (1,153) | (2,321) |
Capitalized costs of developing software | $ (3,564) | (4,245) |
Other | (29) | |
Net cash used in investing activities | $ (4,717) | (6,595) |
Cash flows from financing activities: | ||
Purchases of treasury stock | (1,277) | (4,500) |
Payments of TV business liabilities | (948) | (139) |
Proceeds from TV business assets | 413 | 952 |
Payment of tax withholding obligation for shares tendered | (159) | $ (164) |
Payments of Financing Property and equipment | (579) | |
Net cash used in financing activities | (2,550) | $ (3,851) |
Effect of exchange rate changes on cash and cash equivalents | (137) | (357) |
Net decrease in cash and cash equivalents | (1,758) | (7,462) |
Cash and cash equivalents at beginning of year | 42,046 | 90,672 |
Cash and cash equivalents at end of year | 40,288 | 83,210 |
Supplemental disclosures of cash flow information: | ||
Cash paid for income taxes | $ 89 | 430 |
Cash received for interest | (27) | |
Extended payment obligations incurred to purchase software | $ 960 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation Sizmek Inc. ("Sizmek," the "Company," "we," "us," and "our"), a Delaware corporation formed in 2013, operates a leading independent global online ad campaign management and distribution platform as measured by the number of advertising impressions served and the number of countries in which we serve customers. Our revenues are principally derived from services related to online advertising. We help advertisers, agencies and publishers engage with consumers across multiple online media channels (mobile, display, rich media, video and social) while delivering efficient, impactful and measurable ad campaigns. We connect 19,000 advertisers and 3,700 agencies to audiences in approximately 65 countries, serving more than 1.3 trillion impressions a year. Sizmek works directly and indirectly with media agencies, advertisers, creative agencies, and publishers. Our primary customers are media agencies The ability to execute advertising campaigns in a timely and scalable manner is a crucial requirement for our customers. Our technology empowers advertisers and agencies to deliver their creative assets to broad audiences, ensure consistent quality of the consumer experience, and utilize our data for rigorous analysis and optimization. We focus on online media advertising, including display, video, mobile, social and connected TV channels. Our online campaign management platform, Sizmek MDX, helps advertisers, agencies and publishers simplify the complexities of managing their advertising budgets across multiple online media channels and formats, such as desktop, mobile, rich media, social media, in-stream video, interactive video, display and search. The Sizmek MDX platform strives to provide our customers with an easy-to-use, end-to-end solution to enhance planning, creative, delivery, measurement and optimization of online media campaigns. Our solutions are delivered through a scalable technology platform that allows delivery of sophisticated, global online media advertising campaigns, as well as smaller, more targeted campaigns. Presently, our R&D team is designing and developing a new ad management platform, the Sizmek MDX-NXT platform, which will be a single, end-to-end, integrated platform encompassing all channels and formats. Portions of the MDX-NXT platform are operating currently and we expect substantially all features and functionalities to be operational mid to late 2016. Our focus on open ad management means guiding advertisers and publishers through this complex and fragmented online landscape by providing products and services to help advertisers reach, engage and optimize their desired audience for each particular campaign. Open ad management means: · end-to-end—bringing together all of the technology, intelligence and strategic guidance that a client needs to execute the most effective, global campaign; and · choice—providing an open, flexible framework that allows each client to choose what's best for their particular needs. Reach. Engage. Optimize. |
General
General | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
General | 2. General Principles of Consolidation The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of our wholly-owned, and majority-owned and controlled subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. These unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. These financial statements have been prepared by us without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe the disclosures are adequate to make the information presented not misleading. The unaudited consolidated financial statements reflect all adjustments, which are, in the opinion of management, of a normal and recurring nature and necessary for a fair presentation of our financial position as of the balance sheet dates, and the results of operations and cash flows for the periods presented. Seasonality Our business is seasonal. Revenues tend to be the highest in the fourth quarter as a large portion of our revenues follow the advertising patterns of our customers. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to the recoverability and useful lives of our long-lived assets, the adequacy of our allowance for doubtful accounts and credit memo reserves, contingent consideration and income taxes. We base our estimates on historical experience, future expectations and on other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. net loss by $ 5.0 million and our loss per share by $0.17. Risk of Future Goodwill and Long-Lived Assets Impairments See Note 5 for a discussion of the risk of a future impairment of our goodwill. Assets and Liabilities of DG’s TV Business Pursuant to the Separation and Redemption Agreement, DG contributed to us substantially all of its television business current assets and certain other assets existing on February 7, 2014, and we agreed to assume substantially all of DG’s television business liabilities that existed on February 7, 2014 or were attributable to periods up to and including February 7, 2014. These net assets contributed were recorded at $78.5 million. The details of these assets and liabilities outstanding as of March 31, 2016 and December 31, 2015 were as follows (in thousands): Description March 31, 2016 December 31, 2015 Current assets of television business: Income tax receivables $ 284 $ 515 Trade accounts receivable — 163 Total $ 284 $ 678 Current liabilities of television business: Accrued liabilities $ — $ 930 Uncertain tax positions 424 273 Total $ 424 $ 1,203 Derivative Instruments We enter into foreign currency forward contracts and options to hedge a portion of the exposure to the variability in expected future cash flows resulting from changes in related foreign currency exchange rates between the New Israeli Shekel (“NIS”) and the U.S. Dollar. These transactions were designated as cash flow hedges, as defined by Accounting Standards Codification (“ASC”) Topic 815, “ Derivatives and Hedging Fair Value Measurements and Disclosures Our cash flow hedging strategy is to hedge against the risk of overall changes in cash flows resulting from certain forecasted foreign currency rent and salary payments during the next twelve months. We hedge portions of our forecasted expenses denominated in the NIS with a single counterparty using foreign currency forward contracts and options. At March 31, 2016, we had $12.4 million notional amount of foreign currency forward contracts and options outstanding that had a net fair value asset balance of $0.2 million ($0.3 million asset, net of a $0.1 million liability). At December 31, 2015, we had $14.5 million notional amount of foreign currency forward contracts and options outstanding that had a net fair value liability balance of $0.1 million ($0.3 million liability, net of a $0.2 million asset). The net asset (at March 31, 2016) and net liability (at December 31, 2015) is included in current assets and accrued liabilities, respectively, and is expected to be recognized in our results of operations in the next twelve months. The vast majority of any gain or loss from hedging activities is included in our various operating expenses. As a result of our hedging activities, we incurred the following gains and losses in our results of operations (in thousands): Three Months Ended March 31, 2016 2015 Hedging (loss) gain recognized in operations $ 3 $ (71 ) Accumulated Other Comprehensive Income (Loss) Components of accumulated other comprehensive income (loss) (“AOCI” or “AOCL”), net of tax, for the three months ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 Foreign Currency Translation Unrealized Gains (Losses) on Foreign Currency Derivatives Unrealized Gain on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2015 $ (4,244 ) $ (71 ) $ 956 $ (3,359 ) Other comprehensive income (loss) before reclassifications (295 ) 254 23 (18 ) Amounts reclassified out of AOCL — (3 ) — (3 ) Net current period activity (295 ) 251 23 (21 ) Balance at March 31, 2016 $ (4,539 ) $ 180 $ 979 $ (3,380 ) Three Months Ended March 31, 2015 Foreign Currency Translation Unrealized Losses on Foreign Currency Derivatives Unrealized Gain (Loss) on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2014 $ (2,672 ) $ (98 ) $ 1,255 $ (1,515 ) Other comprehensive loss before reclassifications (804 ) (159 ) (228 ) (1,191 ) Amounts reclassified out of AOCI — 64 — 64 Net current period activity (804 ) (95 ) (228 ) (1,127 ) Balance at March 31, 2015 $ (3,476 ) $ (193 ) $ 1,027 $ (2,642 ) The following table summarizes the reclassifications from AOCI or AOCL to the consolidated statements of operations for the three months ended March 31, 2016 and 2015 (in thousands): Amounts Reclassified out of AOCI or AOCL Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Affected Line Items in the Consolidated Statements of Operations Gains (losses) on cash flow hedges: Foreign currency derivatives $ 1 $ (8 ) Cost of revenues Foreign currency derivatives — (3 ) Selling and marketing Foreign currency derivatives 7 (48 ) Research and development Foreign currency derivatives 1 (11 ) General and administrative Foreign currency derivatives (6 ) (1 ) Other, net Total before taxes 3 (71 ) Tax amounts — 7 Income (loss) after tax $ 3 $ (64 ) Merger, Integration and Other Expenses Merger, integration and other expenses reflect the expenses incurred in (i) DG's Merger with Extreme Reach and our Spin-Off from DG, (ii) acquiring or disposing of a business, (iii) integrating an acquired operation (e.g., severance pay, office closure costs) into the Company and (iv) certain other items of income or expense not deemed to be part of our core operations. A summary of our merger, integration and other expenses is as follows (in thousands): Three Months Ended March 31, Description 2016 2015 Severance (1) $ 434 $ 324 TV business (2) 149 (114 ) Special projects 110 117 Integration costs (3) 2,075 507 Total $ 2,768 $ 834 (1) - Severance costs primarily relate to consolidating the workforces of acquired businesses and eliminating redundancy. All costs shown above were paid in the period the expense was recognized, or shortly thereafter. (2) - Represents (income) or expense due to realizing more or less TV net assets than originally estimated at the time of the Spin-Off. (3) – Represents redundant operating expenses incurred to integrate our 2015 acquisitions into our existing structure and workflow. Recently Issued Accounting Guidance Adopted In September 2015, the Financial Accounting Standards Board ("FASB") issued ASU 2015-16, "Business Combinations." ASU 2015-16 modifies how changes to provisional amounts determined during the measurement period of a business combination are recognized. Under existing accounting literature, changes to provisional amounts determined during the measurement period of a business combination, resulting from facts and circumstances that existed at the acquisition date, are recognized by retrospectively adjusting the provisional amounts at the acquisition date. However, under ASU 2015-16, an acquirer recognizes adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustments are determined. For Sizmek, ASU 2015-16 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Issued In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 modifies revenue recognition guidance for GAAP. Previous revenue recognition guidance in GAAP comprised broad revenue recognition concepts together with numerous revenue requirements for particular industries or transactions, which sometimes resulted in different accounting for economically similar transactions. In contrast, International Accounting Standards Board ("IASB") provided limited guidance on revenue recognition. Accordingly, the FASB and IASB initiated a joint project to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP and International Financial Reporting Standards ("IFRS"). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB issued ASU 2015-14 to defer the effective date of ASU 2014-09 by one year. As a result, for Sizmek, the amendments in ASU 2014-09 are now effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. An entity shall adopt the amendments in ASU 2014-09 by either (i) retrospectively adjusting each prior reporting period presented or (ii) retrospectively adjusting for the cumulative effect of initially applying ASU 2014-09 at the date of initial adoption. We have not as yet determined (i) the extent to which we expect ASU 2014-09 will impact our reported revenues or (ii) the manner in which it will be adopted. In January 2016, the FASB issued ASU 2016-01, "Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. Presently, Sizmek recognizes changes in the fair value of its equity investments that have a readily determinable fair value in accumulated other comprehensive income / loss. ASU 2016-01 also contains certain other provisions. For Sizmek, ASU 2016-01 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. We anticipate that the adoption of ASU 2016-01 will result in greater volatility of our operating results as the changes in fair value of our equity investments that have a readily determinable fair value will be reflected in net income rather than accumulated other comprehensive income / loss. In February 2016, the FASB issued ASU 2016-02, "Leases" Topic 842. ASU 2016-02 modifies accounting for leases under GAAP. ASU 2016-02 1. Recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position. 2. Recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a generally straight-line basis. 3. Classify all cash payments within operating activities in the statement of cash flows. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. An entity that elects to apply the practical expedients will, in effect, continue to account for leases that commence before the effective date in accordance with previous GAAP unless the lease is modified, except that lessees are required to recognize a right-of-use asset and a lease liability for all operating leases at each reporting date based on the present value of the remaining minimum rental payments that were tracked and disclosed under previous GAAP. For Sizmek, ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. In March 2016, the FASB issued ASU 2016-09, "Compensation – Stock Compensation (Topic 718)." ASU 2016-09 will change how companies account for certain aspects of share-based payments to employees. Entities will be required to recognize the income tax effects of awards in the income statement when the awards vest or settle (i.e. additional paid in capital or APIC pools will be eliminated). The guidance also will change how an employer accounts for an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation and for forfeitures. We have not as yet determined (i) the extent to which we expect ASU 2016-09 will impact our financial reports or (ii) the manner in which it will be adopted. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements ASC 820, Fair Value Measurement, ASC 820 establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: · Level 1—Quoted prices in active markets for identical assets or liabilities. · Level 2—Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. · Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. We have classified our assets and liabilities that are measured at fair value on a recurring basis (at least annually) into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date. The tables below set forth by level, assets and liabilities that were accounted for at fair value as of March 31, 2016 and December 31, 2015. The carrying values of our accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these financial instruments. The tables do not include cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value (in thousands). Fair Value Measurements at March 31, 2016 Balance Sheet Location Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Total Fair Value Measurements Assets: Money market funds (a) $ 10,959 $ — $ 10,959 Marketable equity securities (b) 1,320 — 1,320 Currency forward derivatives / options (c) — 204 204 Total $ 12,279 $ 204 $ 12,483 Fair Value Measurements at December 31, 2015 Balance Sheet Location Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Total Fair Value Measurements Assets: Money market funds (a) $ 23,932 $ — $ 23,932 Marketable equity securities (b) 1,297 — 1,297 Total $ 25,229 $ — $ 25,229 Liabilities: Currency forward derivatives / options (d) $ — $ 86 $ 86 (a) Included in cash and cash equivalents. (b) Included in other non-current assets. (c) Included in current assets (d) Included in accrued liabilities. The fair value of our money market funds was determined based upon quoted market prices. The currency forward derivatives/options are derivative instruments whose value is based upon quoted market prices from various market participants. We have a zero cost basis in these derivative instruments. Our marketable equity securities relate to a single issuer and have a cost basis of $0.3 million. Abakus Convertible Notes In May 2014, we purchased $1.0 million of Abakus convertible promissory notes ("Convertible Notes") for $1.0 million. The Convertible Notes are due 90 days after written notice after the earlier of (i) May 30, 2016 or (ii) an occurrence of an Event of Default (as defined in the Convertible Notes). Abakus is a small private company that has developed a digital attribution software solution. The Convertible Notes bear interest at 5% per annum payable at maturity. The Convertible Notes are convertible into Abakus Series A Preferred Stock ("Series A Preferred") as follows: a) Automatic conversion if Abakus sells $2.0 million of Series A Preferred ("Qualified Financing"), whereupon the Convertible Notes shall be converted, at Sizmek's option, at either (i) 75% of the share price in the Qualified Financing, or (ii) the quotient of $7.0 million divided by the number of shares outstanding upon exercise of all dilutive securities, or b) Optional conversion at Sizmek's election if Abakus completes an Equity Financing (as defined in the Convertible Notes) that is not a Qualified Financing, whereupon the Convertible Notes shall be converted at 75% of the share price in the Equity Financing. In addition, upon a Change in Control, as defined in the Convertible Notes, the Convertible Notes shall be paid off at the greater of (i) the outstanding balance, or (ii) the amount the holder would have received upon conversion of the Convertible Notes. The Convertible Notes are considered held-to-maturity securities and are carried at amortized cost. The fair value of the Convertible Notes is not readily determinable. We are not aware of a market for the Convertible Notes. The Convertible Notes are included in other non-current assets. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | 4. Acquisitions StrikeAd On May 28, 2015, we acquired substantially all the assets and operations, and assumed certain liabilities, of privately-held StrikeAd, Inc. and its affiliates (collectively, “StrikeAd”) for $9.8 million. The purchase price includes $7.7 million in cash paid at closing and deferred payment obligations totaling $2.1 million. StrikeAd operates a mobile demand side platform (“DSP”) based in the United Kingdom. We are combining the StrikeAd assets with our existing programmatic assets to build an end-to-end DSP for use by our customers. The objective of the transaction was to accelerate the development of our mobile technology in order to better serve the advertising community. We expect to realize operating synergies from this transaction. StrikeAd has been included in our results of operations since the date of closing. The purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values. We allocated $4.3 million to developed technology, $1.2 million to customer relationships and $11.0 million to goodwill. The developed technology and customer relationships acquired in the transaction are presently being amortized on a straight-line basis over 3.2 years and 5.5 years, respectively. The weighted average amortization period is 3.7 years. See Goodwill, Intangible Assets and Impairments note below. The goodwill and other intangible assets created in the acquisition are deductible for tax purposes. As part of the acquisition, the seller guaranteed to provide a fixed amount of working capital on the acquisition date. Any shortfall from the guaranteed amount can be withheld from our deferred payment obligation. The updated purchase price allocation will be considered preliminary until the final amount of working capital acquired has been determined. Point Roll On November 12, 2015, we acquired all of the shares of Point Roll, Inc. (“Point Roll”) from TEGNA Inc. (“Tegna”) for a total purchase price of $20.0 million, subject to adjustment. Of the total purchase price (i) $11.0 million was paid in cash at closing, (ii) $7.0 million will be paid one year after the closing date and (iii) up to $2.0 million will be paid one year after the closing date, subject to any indemnification claims or other contingencies, of which we currently expect to pay only $0.6 million. Point Roll provides rich media and dynamic creative ad serving technologies that allow interactivity in online advertising, such as streaming video, polling, and e-mail and data collection. The purchase price was paid from cash on hand. The objective of the transaction was to realize significant operating synergies by combining the operations of Point Roll with our existing online ad serving operations. The purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values. During the three months ended March 31, 2016, we revised the purchase price allocation from our original estimates which increased goodwill by $0.9 million, increased other intangible assets by $0.7 million, increased current assets by $0.2 million, increased other long term assets by $0.4 million, reduced property and equipment by $0.5 million, increase liabilities by $2.9 million which reduced the purchase price by $1.2 million. Each of the customer relationships and trade names acquired in the transaction are being amortized on a straight-line basis over 4.1 years. The goodwill and other intangible assets created in the acquisition are not deductible for tax purposes. The liabilities assumed include $1.2 million for an uncertain tax position relating to a period prior to our purchase. Tegna has agreed to indemnify us for this potential exposure. Accordingly, we have recorded an indemnification asset for $1.2 million in purchase accounting. As part of the acquisition, the seller guaranteed to provide a fixed amount of working capital on the acquisition date. Any shortfall from the guaranteed amount can be withheld from our deferred payment obligation. The updated purchase price allocation will be considered preliminary until the final amount of working capital acquired has been determined. The following table summarizes the updated estimated fair values of the assets acquired and liabilities assumed at the respective dates of acquisition for the above referenced transactions (in millions). Category Point Roll StrikeAd Current assets $ 9.8 $ 3.6 Property and equipment 0.9 — Other assets 1.6 — Customer relationships 7.0 1.2 Trade names 0.5 — Developed technology — 4.3 Noncompetition agreements — — Goodwill 5.6 11.0 Total assets acquired 25.4 20.1 Less liabilities assumed (6.8 ) (10.3 ) Net assets acquired $ 18.6 $ 9.8 The following pro forma information presents our results of operations for the three months ended March 31, 2016 and 2015 as if the acquisitions of Point Roll and StrikeAd had occurred on January 1, 2015 (in thousands). A table of actual amounts is provided for reference. As Reported Three Months Ended March 31, Unaudited Pro Forma Three Months Ended March 31, 2016 2015 2016 2015 Revenue $ 40,525 $ 36,759 $ 40,525 $ 48,309 Net loss (6,952 ) (7,945 ) (6,952 ) (10,420 ) |
Goodwill, Intangible Assets and
Goodwill, Intangible Assets and Impairments | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Intangible Assets and Impairments | 5. Goodwill, Intangible Assets and Impairments Goodwill We operate as a single reporting unit. Changes in the carrying value of our goodwill for the three months ended March 31, 2016 were as follows (in thousands): Goodwill Accumulated Impairment Losses Net Carrying Value Balance at December 31, 2015 $ 396,354 $ (387,943 ) $ 8,411 2016 activity 926 — 926 Balance at March 31, 2016 $ 397,280 $ (387,943 ) $ 9,337 We evaluate goodwill for possible impairment each year on December 31st and whenever events or changes in circumstances indicate the carrying value of our goodwill may not be recoverable. Generally, the goodwill impairment test involves a two-step process. In the first step, we compare the fair value of the Company to its carrying value. If the fair value of the Company exceeds its carrying value, goodwill is not impaired and no further testing is required. If the fair value of the Company is less than its carrying value, we must perform the second step of the impairment test to measure the amount of the impairment loss. In the second step, the Company's fair value is allocated to its assets and liabilities, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the Company was being acquired in a business combination. If the implied fair value of the Company's goodwill is less than the carrying value, the difference is recorded as an impairment loss. ASC 350-20-35 allows an entity to assess qualitatively whether it is necessary to perform step one of the prescribed two-step annual goodwill impairment test. If an entity believes, as a result of its qualitative assessment, that it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, the two-step goodwill impairment test is not required. During the fourth quarter of 2015, we determined that indicators of potential impairment existed requiring us to perform both a long-lived asset impairment test and a goodwill impairment test. These indicators included (i) revenues and operating results sufficiently below our earlier forecast which prompted us to reduce our long range forecast, and (ii) a sharp decline in our market capitalization during the fourth quarter of 2015 such that our market capitalization plus a reasonable control premium was well below the book value of our total stockholders' equity. In 2015, we recorded goodwill and long-lived asset impairment charges of $47.4 million and $64.2 million, respectively. Risk of Future Goodwill and Long-Lived Assets Impairment At March 31, 2016 and December 31, 2015, based on our discounted cash flow (DCF) model that uses our internal forecast, we determined the fair value of the Company was only slightly in excess of its carrying value. In preparing our model, we made assumptions about future revenues and expenses for several periods to determine the cash flows that would result. As with any forecast, there is substantial risk our forecasted cash flows may fall short of our current expectations. If actual or expected future cash flows should fall sufficiently below our current forecast, it is likely we would be required to record another goodwill impairment charge. Future net cash flows are impacted by a variety of factors including revenues, operating margins, capital expenditures, income tax rates, and a discount rate. |
Share-based Compensation
Share-based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Stock Plan And Stock Repurchase Program | |
Stock Plan and Stock Repurchase Program | 6. Share-based Compensation Three Months Ended March 31, Description 2016 2015 Sizmek share-based compensation $ 867 $ 846 In the first quarter of 2016, Sizmek’s Compensation Committee granted (i) 471,362 performance-based Restricted Stock Units (“RSUs”) and, (ii) 431,116 time-based RSUs to certain of our employees and directors. The RSUs expected to vest, were valued at $2.8 million. The awards (i) vest over periods ranging from one to three years, (ii) are subject to the employees’ continued employment with us or the director’s continued service on our Board of Directors, and (iii) with respect to the performance-based RSUs, are subject to reaching certain (a) revenue, (b) adjusted EBITDA and (c) free cash flow growth targets (i.e., performance conditions). The awards vest on an accelerated basis upon the occurrence of the holder’s (a) death, (b) termination by reason of disability, (c) termination without Cause (as defined) following a Change of Control (as defined) or (d) resignation for Good Reason (as defined) following a Change in Control. Unrecognized compensation costs related to unvested RSUs and stock options were $6.1 million at March 31, 2016. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes For the three months ended March 31, 2016, our effective tax rate was (7.3)% compared to (1.7)% for the three months ended March 31, 2015. The effective tax rates for each period differ from the expected federal statutory rate of 35.0% as a result of state and foreign income taxes; certain non-deductible expenses; and changes in our valuation allowances in Israel, the U.S. and state jurisdictions within the U.S. As a result, we do not recognize a tax benefit in Israel, the U.S. or state jurisdictions within the U.S. when we incur taxable losses as realization of those tax benefits is not more-likely-than-not. Conversely, in certain foreign jurisdictions we report earnings and recognize a tax expense or benefit on that income in accordance with the tax statutes of those jurisdictions. We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than not sustain the position following an audit. For tax positions meeting the more-likely-than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. During the three months ended March 31, 2016, we recognized one additional uncertain tax position related a state and local income tax matter. Approximately $0.4 million of the increase relates to a position we acquired from Point Roll, for which we have an offsetting indemnification asset from the seller. Interest and penalties related to uncertain tax positions are recognized in income tax expense. For each of the three month periods ended March 31, 2016 and 2015, we recognized less than $0.1 million of interest and penalties related to uncertain tax positions in our financial statements. The changes in uncertain tax positions for the three months ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 2015 Balance at beginning of year $ 2,677 $ 1,507 Additions or Subtractions, net 90 (17 ) Balance at end of period $ 2,767 $ 1,490 If we reduced our reserve for uncertain tax positions, it would result in our recognition of a tax benefit. As of March 31, 2016, we provided a valuation allowance against substantially all of our (i) U.S. federal and state NOL carryforwards and (ii) NOL carryforwards in Israel, as ultimate realization of these NOLs was determined to be not more-likely-than not. Accordingly, we have NOL carryforwards available to us (should we have sufficient future taxable income to utilize them) that are not reflected in our consolidated balance sheets at March 31, 2016 and December 31, 2015, respectively. We are subject to U.S. federal income tax, income tax from multiple foreign jurisdictions including Israel and the United Kingdom, and income taxes of multiple state jurisdictions. U.S. federal, state and local income tax returns for 2011 through 2015 remain open to examination. Israeli and United Kingdom income tax returns remain open to examination for 2010 through 2015 and 2009 through 2015, respectively. Prior to our Spin-Off, our operating results had been included in DG's U.S. federal and state tax returns or tax returns of non-U.S. jurisdictions. Subsequent to our Spin-Off, we file stand-alone income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and various foreign jurisdictions. Prior to our Spin-Off, we entered into a tax matters agreement with DG that governs the parties' respective rights, responsibilities and obligations with respect to taxes. The tax matters agreement generally provides that the filing of tax returns, the control of audit proceedings, and the payment of any additional tax liability relative to DG and its consolidated subsidiaries for periods prior to February 8, 2014 is our responsibility. We do not provide deferred taxes on the undistributed earnings of our non-U.S. subsidiaries in situations where our intention is to reinvest such earnings indefinitely. Furthermore, we believe both our U.S. and non-U.S. subsidiaries have significant net assets, liquidity, and other financial resources available to meet their operational and capital investment requirements. |
Loss per Share
Loss per Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Loss per Share | 8. Loss per Share Basic earnings (loss) per common share excludes dilution and is calculated by dividing net earnings (loss) by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per common share is calculated by dividing net earnings (loss) by the weighted-average number of common shares outstanding during the period, as adjusted for the potential dilutive effect of non-participating share-based awards such as stock options and RSUs. The Company does not include any potentially dilutive securities in its calculation of diluted loss per common share, since their effect would be anti-dilutive. The following table presents our loss per common share for the three months ended March 31, 2016 and 2015 (in thousands, except per share data): Three Months Ended March 31, 2016 2015 Net loss $ (6,952 ) $ (7,945 ) Weighted average common shares outstanding — basic 29,034 29,783 Dilutive securities — — Weighted average common shares outstanding - diluted 29,034 29,783 Basic and diluted loss per common share $ (0.24 ) $ (0.27 ) Antidilutive securities not included: Stock options and RSUs 1,079 1,092 |
Geographical Information and Pr
Geographical Information and Product Categories | 3 Months Ended |
Mar. 31, 2016 | |
Segments, Geographical Areas [Abstract] | |
Geographical Information and Product Categories | 9. Geographical Information and Product Categories We have one operating segment. Our chief operating decision maker is considered to be our Chief Executive Officer. The chief operating decision maker allocates resources and assesses performance of the business and other activities at the operating segment level. The following table summarizes our revenues by geographic area (in thousands): Three Months Ended March 31, 2016 2015 Revenues: United States $ 23,001 $ 19,600 Europe, Middle East and Africa 10,465 9,350 Asia Pacific 5,298 5,894 Latin America 1,094 1,351 North America (excluding U.S.) 667 564 Total $ 40,525 $ 36,759 For the three months ended March 31, 2016, about 43.2% of our revenues were attributable to foreign jurisdictions. However, no single country other than the United States represented more than 10% of our consolidated revenues. The following table summarizes our revenues by product category (in thousands): Three Months Ended March 31, 2016 2015 Revenues: Platform solutions $ 34,430 $ 32,892 Programmatic solutions 6,095 3,867 Total $ 40,525 $ 36,759 The following table summarizes our property and equipment, net by country (in thousands): March 31, 2016 December 31, 2015 Property and equipment, net: Israel $ 24,141 $ 21,387 United States 6,099 6,441 Other countries 1,875 1,582 Total $ 32,115 $ 29,410 |
General (Policies)
General (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and include the accounts of our wholly-owned, and majority-owned and controlled subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. These unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. These financial statements have been prepared by us without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe the disclosures are adequate to make the information presented not misleading. The unaudited consolidated financial statements reflect all adjustments, which are, in the opinion of management, of a normal and recurring nature and necessary for a fair presentation of our financial position as of the balance sheet dates, and the results of operations and cash flows for the periods presented. |
Seasonality | Seasonality Our business is seasonal. Revenues tend to be the highest in the fourth quarter as a large portion of our revenues follow the advertising patterns of our customers. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to the recoverability and useful lives of our long-lived assets, the adequacy of our allowance for doubtful accounts and credit memo reserves, contingent consideration and income taxes. We base our estimates on historical experience, future expectations and on other relevant assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. net loss by $ 5.0 million and our loss per share by $0.17. |
Risk of Future Goodwill and Long-Lived Assets Impairments | Risk of Future Goodwill and Long-Lived Assets Impairments See Note 5 for a discussion of the risk of a future impairment of our goodwill. |
Assets and Liabilities of DG's TV Business | Assets and Liabilities of DG’s TV Business Pursuant to the Separation and Redemption Agreement, DG contributed to us substantially all of its television business current assets and certain other assets existing on February 7, 2014, and we agreed to assume substantially all of DG’s television business liabilities that existed on February 7, 2014 or were attributable to periods up to and including February 7, 2014. These net assets contributed were recorded at $78.5 million. The details of these assets and liabilities outstanding as of March 31, 2016 and December 31, 2015 were as follows (in thousands): Description March 31, 2016 December 31, 2015 Current assets of television business: Income tax receivables $ 284 $ 515 Trade accounts receivable — 163 Total $ 284 $ 678 Current liabilities of television business: Accrued liabilities $ — $ 930 Uncertain tax positions 424 273 Total $ 424 $ 1,203 |
Derivative Instruments | Derivative Instruments We enter into foreign currency forward contracts and options to hedge a portion of the exposure to the variability in expected future cash flows resulting from changes in related foreign currency exchange rates between the New Israeli Shekel (“NIS”) and the U.S. Dollar. These transactions were designated as cash flow hedges, as defined by Accounting Standards Codification (“ASC”) Topic 815, “ Derivatives and Hedging Fair Value Measurements and Disclosures Our cash flow hedging strategy is to hedge against the risk of overall changes in cash flows resulting from certain forecasted foreign currency rent and salary payments during the next twelve months. We hedge portions of our forecasted expenses denominated in the NIS with a single counterparty using foreign currency forward contracts and options. At March 31, 2016, we had $12.4 million notional amount of foreign currency forward contracts and options outstanding that had a net fair value asset balance of $0.2 million ($0.3 million asset, net of a $0.1 million liability). At December 31, 2015, we had $14.5 million notional amount of foreign currency forward contracts and options outstanding that had a net fair value liability balance of $0.1 million ($0.3 million liability, net of a $0.2 million asset). The net asset (at March 31, 2016) and net liability (at December 31, 2015) is included in current assets and accrued liabilities, respectively, and is expected to be recognized in our results of operations in the next twelve months. The vast majority of any gain or loss from hedging activities is included in our various operating expenses. As a result of our hedging activities, we incurred the following gains and losses in our results of operations (in thousands): Three Months Ended March 31, 2016 2015 Hedging (loss) gain recognized in operations $ 3 $ (71 ) |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Components of accumulated other comprehensive income (loss) (“AOCI” or “AOCL”), net of tax, for the three months ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 Foreign Currency Translation Unrealized Gains (Losses) on Foreign Currency Derivatives Unrealized Gain on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2015 $ (4,244 ) $ (71 ) $ 956 $ (3,359 ) Other comprehensive income (loss) before reclassifications (295 ) 254 23 (18 ) Amounts reclassified out of AOCL — (3 ) — (3 ) Net current period activity (295 ) 251 23 (21 ) Balance at March 31, 2016 $ (4,539 ) $ 180 $ 979 $ (3,380 ) Three Months Ended March 31, 2015 Foreign Currency Translation Unrealized Losses on Foreign Currency Derivatives Unrealized Gain (Loss) on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2014 $ (2,672 ) $ (98 ) $ 1,255 $ (1,515 ) Other comprehensive loss before reclassifications (804 ) (159 ) (228 ) (1,191 ) Amounts reclassified out of AOCI — 64 — 64 Net current period activity (804 ) (95 ) (228 ) (1,127 ) Balance at March 31, 2015 $ (3,476 ) $ (193 ) $ 1,027 $ (2,642 ) The following table summarizes the reclassifications from AOCI or AOCL to the consolidated statements of operations for the three months ended March 31, 2016 and 2015 (in thousands): Amounts Reclassified out of AOCI or AOCL Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Affected Line Items in the Consolidated Statements of Operations Gains (losses) on cash flow hedges: Foreign currency derivatives $ 1 $ (8 ) Cost of revenues Foreign currency derivatives — (3 ) Selling and marketing Foreign currency derivatives 7 (48 ) Research and development Foreign currency derivatives 1 (11 ) General and administrative Foreign currency derivatives (6 ) (1 ) Other, net Total before taxes 3 (71 ) Tax amounts — 7 Income (loss) after tax $ 3 $ (64 ) Merger, Integration and Other Expenses Merger, integration and other expenses reflect the expenses incurred in (i) DG's Merger with Extreme Reach and our Spin-Off from DG, (ii) acquiring or disposing of a business, (iii) integrating an acquired operation (e.g., severance pay, office closure costs) into the Company and (iv) certain other items of income or expense not deemed to be part of our core operations. A summary of our merger, integration and other expenses is as follows (in thousands): Three Months Ended March 31, Description 2016 2015 Severance (1) $ 434 $ 324 TV business (2) 149 (114 ) Special projects 110 117 Integration costs (3) 2,075 507 Total $ 2,768 $ 834 (1) - Severance costs primarily relate to consolidating the workforces of acquired businesses and eliminating redundancy. All costs shown above were paid in the period the expense was recognized, or shortly thereafter. (2) - Represents (income) or expense due to realizing more or less TV net assets than originally estimated at the time of the Spin-Off. (3) – Represents redundant operating expenses incurred to integrate our 2015 acquisitions into our existing structure and workflow. |
Merger, Integration and Other Expenses | Merger, Integration and Other Expenses Merger, integration and other expenses reflect the expenses incurred in (i) DG's Merger with Extreme Reach and our Spin-Off from DG, (ii) acquiring or disposing of a business, (iii) integrating an acquired operation (e.g., severance pay, office closure costs) into the Company and (iv) certain other items of income or expense not deemed to be part of our core operations. A summary of our merger, integration and other expenses is as follows (in thousands): Three Months Ended March 31, Description 2016 2015 Severance (1) $ 434 $ 324 TV business (2) 149 (114 ) Special projects 110 117 Integration costs (3) 2,075 507 Total $ 2,768 $ 834 (1) - Severance costs primarily relate to consolidating the workforces of acquired businesses and eliminating redundancy. All costs shown above were paid in the period the expense was recognized, or shortly thereafter. (2) - Represents (income) or expense due to realizing more or less TV net assets than originally estimated at the time of the Spin-Off. (3) – Represents redundant operating expenses incurred to integrate our 2015 acquisitions into our existing structure and workflow. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance Adopted In September 2015, the Financial Accounting Standards Board ("FASB") issued ASU 2015-16, "Business Combinations." ASU 2015-16 modifies how changes to provisional amounts determined during the measurement period of a business combination are recognized. Under existing accounting literature, changes to provisional amounts determined during the measurement period of a business combination, resulting from facts and circumstances that existed at the acquisition date, are recognized by retrospectively adjusting the provisional amounts at the acquisition date. However, under ASU 2015-16, an acquirer recognizes adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustments are determined. For Sizmek, ASU 2015-16 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Issued In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 modifies revenue recognition guidance for GAAP. Previous revenue recognition guidance in GAAP comprised broad revenue recognition concepts together with numerous revenue requirements for particular industries or transactions, which sometimes resulted in different accounting for economically similar transactions. In contrast, International Accounting Standards Board ("IASB") provided limited guidance on revenue recognition. Accordingly, the FASB and IASB initiated a joint project to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP and International Financial Reporting Standards ("IFRS"). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB issued ASU 2015-14 to defer the effective date of ASU 2014-09 by one year. As a result, for Sizmek, the amendments in ASU 2014-09 are now effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. An entity shall adopt the amendments in ASU 2014-09 by either (i) retrospectively adjusting each prior reporting period presented or (ii) retrospectively adjusting for the cumulative effect of initially applying ASU 2014-09 at the date of initial adoption. We have not as yet determined (i) the extent to which we expect ASU 2014-09 will impact our reported revenues or (ii) the manner in which it will be adopted. In January 2016, the FASB issued ASU 2016-01, "Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. Presently, Sizmek recognizes changes in the fair value of its equity investments that have a readily determinable fair value in accumulated other comprehensive income / loss. ASU 2016-01 also contains certain other provisions. For Sizmek, ASU 2016-01 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. We anticipate that the adoption of ASU 2016-01 will result in greater volatility of our operating results as the changes in fair value of our equity investments that have a readily determinable fair value will be reflected in net income rather than accumulated other comprehensive income / loss. In February 2016, the FASB issued ASU 2016-02, "Leases" Topic 842. ASU 2016-02 modifies accounting for leases under GAAP. ASU 2016-02 1. Recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position. 2. Recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term on a generally straight-line basis. 3. Classify all cash payments within operating activities in the statement of cash flows. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. An entity that elects to apply the practical expedients will, in effect, continue to account for leases that commence before the effective date in accordance with previous GAAP unless the lease is modified, except that lessees are required to recognize a right-of-use asset and a lease liability for all operating leases at each reporting date based on the present value of the remaining minimum rental payments that were tracked and disclosed under previous GAAP. For Sizmek, ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. In March 2016, the FASB issued ASU 2016-09, "Compensation – Stock Compensation (Topic 718)." ASU 2016-09 will change how companies account for certain aspects of share-based payments to employees. Entities will be required to recognize the income tax effects of awards in the income statement when the awards vest or settle (i.e. additional paid in capital or APIC pools will be eliminated). The guidance also will change how an employer accounts for an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation and for forfeitures. We have not as yet determined (i) the extent to which we expect ASU 2016-09 will impact our financial reports or (ii) the manner in which it will be adopted. |
General (Tables)
General (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of DG's assets and liabilities outstanding | Description March 31, 2016 December 31, 2015 Current assets of television business: Income tax receivables $ 284 $ 515 Trade accounts receivable — 163 Total $ 284 $ 678 Current liabilities of television business: Accrued liabilities $ — $ 930 Uncertain tax positions 424 273 Total $ 424 $ 1,203 |
Schedule of gains and losses recognized in consolidated results of operations due to hedging activities | Three Months Ended March 31, 2016 2015 Hedging (loss) gain recognized in operations $ 3 $ (71 ) |
Schedule of components of accumulated other comprehensive income (loss) ("AOCI" or "AOCL"), net of tax | Three Months Ended March 31, 2016 Foreign Currency Translation Unrealized Gains (Losses) on Foreign Currency Derivatives Unrealized Gain on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2015 $ (4,244 ) $ (71 ) $ 956 $ (3,359 ) Other comprehensive income (loss) before reclassifications (295 ) 254 23 (18 ) Amounts reclassified out of AOCL — (3 ) — (3 ) Net current period activity (295 ) 251 23 (21 ) Balance at March 31, 2016 $ (4,539 ) $ 180 $ 979 $ (3,380 ) Three Months Ended March 31, 2015 Foreign Currency Translation Unrealized Losses on Foreign Currency Derivatives Unrealized Gain (Loss) on Available for Sale Securities Total Accumulated Other Comprehensive Loss Balance at December 31, 2014 $ (2,672 ) $ (98 ) $ 1,255 $ (1,515 ) Other comprehensive loss before reclassifications (804 ) (159 ) (228 ) (1,191 ) Amounts reclassified out of AOCI — 64 — 64 Net current period activity (804 ) (95 ) (228 ) (1,127 ) Balance at March 31, 2015 $ (3,476 ) $ (193 ) $ 1,027 $ (2,642 ) |
Summary of reclassifications from accumulated other comprehensive income (loss) to the consolidated and combined statements of operations | Amounts Reclassified out of AOCI or AOCL Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Affected Line Items in the Consolidated Statements of Operations Gains (losses) on cash flow hedges: Foreign currency derivatives $ 1 $ (8 ) Cost of revenues Foreign currency derivatives — (3 ) Selling and marketing Foreign currency derivatives 7 (48 ) Research and development Foreign currency derivatives 1 (11 ) General and administrative Foreign currency derivatives (6 ) (1 ) Other, net Total before taxes 3 (71 ) Tax amounts — 7 Income (loss) after tax $ 3 $ (64 ) |
Summary of merger, integration and other expenses | Three Months Ended March 31, Description 2016 2015 Severance (1) $ 434 $ 324 TV business (2) 149 (114 ) Special projects 110 117 Integration costs (3) 2,075 507 Total $ 2,768 $ 834 (1) - Severance costs primarily relate to consolidating the workforces of acquired businesses and eliminating redundancy. All costs shown above were paid in the period the expense was recognized, or shortly thereafter. (2) - Represents (income) or expense due to realizing more or less TV net assets than originally estimated at the time of the Spin-Off. (3) – Represents redundant operating expenses incurred to integrate our 2015 acquisitions into our existing structure and workflow. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities accounted for at fair value | Fair Value Measurements at March 31, 2016 Balance Sheet Location Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Total Fair Value Measurements Assets: Money market funds (a) $ 10,959 $ — $ 10,959 Marketable equity securities (b) 1,320 — 1,320 Currency forward derivatives / options (c) — 204 204 Total $ 12,279 $ 204 $ 12,483 Fair Value Measurements at December 31, 2015 Balance Sheet Location Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Total Fair Value Measurements Assets: Money market funds (a) $ 23,932 $ — $ 23,932 Marketable equity securities (b) 1,297 — 1,297 Total $ 25,229 $ — $ 25,229 Liabilities: Currency forward derivatives / options (d) $ — $ 86 $ 86 (a) Included in cash and cash equivalents. (b) Included in other non-current assets. (c) Included in current assets (d) Included in accrued liabilities. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Summary of the estimated fair values of the assets acquired and liabilities assumed | Category Point Roll StrikeAd Current assets $ 9.8 $ 3.6 Property and equipment 0.9 — Other assets 1.6 — Customer relationships 7.0 1.2 Trade names 0.5 — Developed technology — 4.3 Noncompetition agreements — — Goodwill 5.6 11.0 Total assets acquired 25.4 20.1 Less liabilities assumed (6.8 ) (10.3 ) Net assets acquired $ 18.6 $ 9.8 |
Schedule of as reported and pro forma results of operations relating to acquisitions | As Reported Three Months Ended March 31, Unaudited Pro Forma Three Months Ended March 31, 2016 2015 2016 2015 Revenue $ 40,525 $ 36,759 $ 40,525 $ 48,309 Net loss (6,952 ) (7,945 ) (6,952 ) (10,420 ) |
Goodwill, Intangible Assets a21
Goodwill, Intangible Assets and Impairments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in carrying value of goodwill | Goodwill Accumulated Impairment Losses Net Carrying Value Balance at December 31, 2015 $ 396,354 $ (387,943 ) $ 8,411 2016 activity 926 — 926 Balance at March 31, 2016 $ 397,280 $ (387,943 ) $ 9,337 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of share-based compensation expense | Three Months Ended March 31, Description 2016 2015 Sizmek share-based compensation $ 867 $ 846 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of changes in uncertain tax positions | Three Months Ended March 31, 2016 2015 Balance at beginning of year $ 2,677 $ 1,507 Additions or Subtractions, net 90 (17 ) Balance at end of period $ 2,767 $ 1,490 |
Loss per Share (Tables)
Loss per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of loss per common share | Three Months Ended March 31, 2016 2015 Net loss $ (6,952 ) $ (7,945 ) Weighted average common shares outstanding — basic 29,034 29,783 Dilutive securities — — Weighted average common shares outstanding - diluted 29,034 29,783 Basic and diluted loss per common share $ (0.24 ) $ (0.27 ) Antidilutive securities not included: Stock options and RSUs 1,079 1,092 |
Geographical Information and 25
Geographical Information and Product Categories (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segments, Geographical Areas [Abstract] | |
Schedule of revenues by geographic area | Three Months Ended March 31, 2016 2015 Revenues: United States $ 23,001 $ 19,600 Europe, Middle East and Africa 10,465 9,350 Asia Pacific 5,298 5,894 Latin America 1,094 1,351 North America (excluding U.S.) 667 564 Total $ 40,525 $ 36,759 |
Schedule of revenues by product category | Three Months Ended March 31, 2016 2015 Revenues: Platform solutions $ 34,430 $ 32,892 Programmatic solutions 6,095 3,867 Total $ 40,525 $ 36,759 |
Schedule of property and equipment, net by country | March 31, 2016 December 31, 2015 Property and equipment, net: Israel $ 24,141 $ 21,387 United States 6,099 6,441 Other countries 1,875 1,582 Total $ 32,115 $ 29,410 |
Basis of Presentation (Details)
Basis of Presentation (Details) | 3 Months Ended |
Mar. 31, 2016item | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of advertisers connected to audiences | 19,000 |
Number of agencies connected to audiences | 3,700 |
Number of countries in which entity operates | 65 |
Minimum number of impressions served | 1,300,000,000,000 |
General (Assets And Liabilities
General (Assets And Liabilities Of DG's TV Business) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Feb. 07, 2014 |
Assets and Liabilities of DG's TV Business [Abstract] | |||
Net assets of TV business contributed by DG | $ 78,500 | ||
Current assets of television business: | |||
Income tax receivable | $ 284 | $ 515 | |
Trade accounts receivable | $ 163 | ||
Springbox revenue sharing | |||
Total | $ 284 | $ 678 | |
Current liabilities of television business: | |||
Accrued liabilities | 930 | ||
Uncertain tax positions | $ 424 | 273 | |
Total | $ 424 | $ 1,203 |
General (Derivative Instruments
General (Derivative Instruments) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Derivative Instruments | |||
Notional amount of foreign currency forward contracts and options outstanding | $ 12,400 | $ 14,500 | |
Net fair value asset (liability) balance of foreign currency forward contracts and options outstanding | 200 | (100) | |
Fair value liability balance of foreign currency forward contracts and options outstanding | 100 | 300 | |
Fair value asset balance of foreign currency forward contracts and options outstanding | 300 | 200 | |
Hedging (loss) gain recognized in operations | 3 | $ (71) | |
Restricted cash | $ 1,581 | $ 1,538 |
General (Components Of Accumula
General (Components Of Accumulated Other Comprehensive Income (Loss) (AOCI or AOCL), Net Of Tax) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of the period | $ (3,359) | $ (1,515) |
Other comprehensive loss before reclassifications | (18) | (1,191) |
Amounts reclassified out of AOCL | (3) | 64 |
Change during the period | (21) | (1,127) |
Balance at end of the period | (3,380) | (2,642) |
Accumulated Translation Adjustment [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of the period | (4,244) | (2,672) |
Other comprehensive loss before reclassifications | $ (295) | $ (804) |
Amounts reclassified out of AOCL | ||
Change during the period | $ (295) | $ (804) |
Balance at end of the period | (4,539) | (3,476) |
Accumulated Net Unrealized Investment Gain Loss [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of the period | 956 | 1,255 |
Other comprehensive loss before reclassifications | $ 23 | $ (288) |
Amounts reclassified out of AOCL | ||
Change during the period | $ 23 | $ (288) |
Balance at end of the period | 979 | 1,027 |
Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance at beginning of the period | (71) | (98) |
Other comprehensive loss before reclassifications | 254 | (159) |
Amounts reclassified out of AOCL | (3) | 64 |
Change during the period | 251 | (95) |
Balance at end of the period | $ 180 | $ (193) |
General (Reclassifications from
General (Reclassifications from AOCI Or AOCL to Consolidated Statements of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Cost of revenues | $ 18,251 | $ 13,660 |
Selling and marketing | 14,822 | 14,203 |
Research and development | 3,209 | 2,903 |
General and administrative | 5,556 | 4,554 |
Other, net | (526) | 979 |
Loss before income taxes | (6,477) | (7,813) |
Tax amounts | (475) | (132) |
Net loss | (6,952) | (7,945) |
Foreign Exchange Contract [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Cost of revenues | $ 1 | (8) |
Selling and marketing | (3) | |
Research and development | $ 7 | (48) |
General and administrative | 1 | (11) |
Other, net | (6) | (1) |
Loss before income taxes | $ 3 | (71) |
Tax amounts | 7 | |
Net loss | $ 3 | $ (64) |
General (Merger, Integration An
General (Merger, Integration And Other Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Accounting Policies [Abstract] | |||
Severance | [1] | $ 434 | $ 324 |
TV business | [2] | 149 | (114) |
Special projects | 110 | 117 | |
Integration costs | [3] | 2,075 | 507 |
Total | $ 2,768 | $ 834 | |
[1] | Severance costs primarily relate to consolidating the workforces of acquired businesses and eliminating redundancy. All costs shown above were paid in the period the expense was recognized, or shortly thereafter. | ||
[2] | Represents (income) or expense due to realizing more or less TV net assets than originally estimated at the time of the Spin-Off. | ||
[3] | Represents redundant operating expenses incurred to integrate our 2015 acquisitions into our existing structure and workflow. |
General (Narrative) (Details)
General (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Long-lived asset impairment charges | $ 64.2 | |
Effect of change in estimate on depreciation and amortization | $ (5) | |
Effect of change in estimate on net loss | $ (5) | |
Effect of change in estimate on net loss per share | $ (0.17) |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value of Assets and Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | |
Assets: | |||
Money market funds | [1] | $ 10,959 | $ 23,932 |
Currency forward derivatives/options | [2] | 204 | |
Marketable equity securities | [3] | 1,320 | 1,297 |
Total | $ 12,483 | 25,229 | |
Liabilities: | |||
Currency forward derivatives/options | [4] | $ 86 | |
Fair Value Inputs Level2 [Member] | |||
Assets: | |||
Money market funds | [1] | ||
Currency forward derivatives/options | [2] | $ 204 | |
Marketable equity securities | [3] | ||
Total | $ 204 | ||
Liabilities: | |||
Currency forward derivatives/options | [4] | $ 86 | |
Fair Value Inputs Level1 [Member] | |||
Assets: | |||
Money market funds | [1] | $ 10,959 | 23,932 |
Currency forward derivatives/options | [2] | ||
Marketable equity securities | [3] | $ 1,320 | 1,297 |
Total | $ 12,279 | $ 25,229 | |
Liabilities: | |||
Currency forward derivatives/options | [4] | ||
[1] | Included in cash and cash equivalents. | ||
[2] | Included in current assets. | ||
[3] | Included in other non-current assets. | ||
[4] | Included in accrued liabilities. |
Fair Value Measurements (Abakus
Fair Value Measurements (Abakus Convertible Notes) (Details) - Abakus [Member] - Convertible Debt Securities [Member] - USD ($) $ in Millions | 1 Months Ended | 23 Months Ended |
May. 31, 2014 | Mar. 31, 2016 | |
Investment [Line Items] | ||
Amount of convertible notes purchased | $ 1 | |
Payment for convertible notes | $ 1 | |
Period of time convertible notes are due after written notice | 90 days | |
Interest rate | 5.00% | |
Amount of Abakus Series A preferred shares to be sold by Abakus for triggering automatic conversion | $ 2 | |
Conversion price as a percentage of the share price in Qualified Financing | 75.00% | |
Amount divided by the number of shares outstanding upon exercise of all dilutive securities to derive quotient for determining conversion price upon automatic conversion | $ 7 | |
Conversion price as a percentage of the share price in the Equity Financing | 75.00% |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) - USD ($) $ in Thousands | Nov. 12, 2015 | May. 28, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 8,411 | $ 9,337 | |||
Point Roll [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 20,000 | ||||
Cash consideration | 11,000 | ||||
Goodwill | 5,600 | ||||
Weighted average amortization period of intangible assets | 4 years 1 month 6 days | ||||
Liability for uncertain tax position | 1,200 | ||||
Indemnification asset | 1,200 | ||||
Consideration to be paid one year after the closing date | 7,000 | ||||
Consideration to be paid one year after the closing date, subject to any indemnification claims | 2,000 | ||||
Consideration to be paid one year after the closing date, subject to any indemnification claims, present value | $ 600 | ||||
Strike Ad [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 9,800 | ||||
Cash consideration | 7,700 | ||||
Goodwill | 11,000 | ||||
Deferred payment obligation | $ 2,100 | ||||
Weighted average amortization period of intangible assets | 3 years 8 months 12 days | ||||
Revenues | $ 11,000 | ||||
Reported loss before income taxes | $ 6,200 | ||||
Strike Ad [Member] | Developed Technology Rights [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 4,300 | ||||
Weighted average amortization period of intangible assets | 3 years 2 months 12 days | ||||
Strike Ad [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 1,200 | ||||
Weighted average amortization period of intangible assets | 5 years 6 months |
Acquisitions (Summary of Estima
Acquisitions (Summary of Estimated Fair values of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Nov. 12, 2015 | May. 28, 2015 | Mar. 31, 2016 | Dec. 31, 2015 |
Purchase Price Allocations | ||||
Goodwill | $ 9,337 | $ 8,411 | ||
Point Roll [Member] | ||||
Purchase Price Allocations | ||||
Current assets | $ 9,800 | |||
Property and equipment | 900 | |||
Other assets | 1,600 | |||
Customer relationships | 7,000 | |||
Trade names | $ 500 | |||
Developed technology | ||||
Noncompetition agreements | ||||
Goodwill | $ 5,600 | |||
Total assets acquired | 25,400 | |||
Less liabilities assumed | (6,800) | |||
Net assets acquired | 18,600 | |||
Purchase price | 20,000 | |||
Point Roll [Member] | Adjustment [Member] | ||||
Purchase Price Allocations | ||||
Current assets | 200 | |||
Property and equipment | (500) | |||
Other assets | 400 | |||
Customer relationships | 700 | |||
Goodwill | 900 | |||
Less liabilities assumed | $ (2,900) | |||
Purchase price | $ (1,200) | |||
Strike Ad [Member] | ||||
Purchase Price Allocations | ||||
Current assets | $ 3,600 | |||
Property and equipment | ||||
Other assets | ||||
Customer relationships | $ 1,200 | |||
Trade names | ||||
Developed technology | $ 4,300 | |||
Noncompetition agreements | ||||
Goodwill | $ 11,000 | |||
Total assets acquired | 20,100 | |||
Less liabilities assumed | (10,300) | |||
Net assets acquired | 9,800 | |||
Purchase price | $ 9,800 |
Acquisitions (Schedule of as Re
Acquisitions (Schedule of as Reported and Pro forma Results of Operations Relating to Acquisitions) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
As Reported | ||
Revenues | $ 40,525 | $ 36,759 |
Net loss | (6,952) | (7,945) |
Unaudited Pro Forma | ||
Revenue | 40,525 | 48,309 |
Net loss | $ (6,952) | $ (10,420) |
Goodwill, Intangible Assets a38
Goodwill, Intangible Assets and Impairments (Schedule of Changes in Carrying Value of Goodwill) (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Goodwill | ||
Balance at beginning of the period | $ 396,354 | |
2016 activity | 926 | |
Balance at end of the period | 397,280 | $ 396,354 |
Accumulated Impairment Losses | ||
Balance at beginning of the period | $ (387,943) | |
2016 activity | (47,400) | |
Balance at end of the period | $ (387,943) | (387,943) |
Net Carrying Value | ||
Balance at beginning of the period | 8,411 | |
2016 activity | 927 | |
Balance at end of the period | $ 9,337 | $ 8,411 |
Goodwill, Intangible Assets a39
Goodwill, Intangible Assets and Impairments (Impairment Charges) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill impairment charges | $ 47.4 | |
Long-lived asset impairment charges | $ 64.2 |
Share-based Compensation (Narra
Share-based Compensation (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Value of RSUs granted in period | $ 2,800 | |
Sizmek share-based compensation | 867 | $ 846 |
Unrecognized compensation cost | $ 6,100 | |
Restricted Stock Units R S U [Member] | Sizmek Equity Based Incentive Plan [Member] | Vesting Based On Performance [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards granted in period (in shares) | 471,362 | |
Restricted Stock Units R S U [Member] | Sizmek Equity Based Incentive Plan [Member] | Vesting Based On Service [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards granted in period (in shares) | 431,116 |
Income Taxes (Schedule of Chang
Income Taxes (Schedule of Changes in Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Change in unrecognized tax benefits | ||
Balance at beginning of year | $ 2,677 | $ 1,507 |
Additions or Subtractions, net | 90 | (17) |
Balance at end of year | $ 2,767 | $ 1,490 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | (7.30%) | (1.70%) |
Federal statutory tax rate | 35.00% | 35.00% |
Interest or penalties recognized related to uncertain tax positions | $ 0.1 | $ 0.1 |
Increase from acquisition of Point Roll | $ 0.4 |
Loss per Share (Details)
Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (6,952) | $ (7,945) |
Weighted average common shares outstanding - basic | 29,034 | 29,783 |
Dilutive securities | ||
Weighted average common shares outstanding - diluted | 29,034 | 29,783 |
Basic and diluted loss per common share | $ (0.24) | $ (0.27) |
Antidilutive securities not included: | ||
Stock options and RSUs (in shares) | 1,079 | 1,092 |
Geographical Information and 44
Geographical Information and Product Categories (Revenues By Geographic Area) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 40,525 | $ 36,759 |
Percentage of revenue attributable to foreign jurisdictions | 43.20% | |
UNITED STATES [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 23,001 | 19,600 |
E M E A [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 10,465 | 9,350 |
Asia Pacific [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 5,298 | 5,894 |
Latin America [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 1,094 | 1,351 |
North America Excluding United States Of America [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 667 | $ 564 |
Geographical Information and 45
Geographical Information and Product Categories (Revenues By Product Category) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 40,525 | $ 36,759 |
Platform Solutions [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 34,430 | 32,892 |
Programmatic Solutions [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 6,095 | $ 3,867 |
Geographical Information and 46
Geographical Information and Product Categories (Long-Lived Assets By Country) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | $ 32,115 | $ 29,410 |
ISRAEL [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | 24,141 | 21,387 |
UNITED STATES [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | 6,099 | 6,441 |
Other Countries [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | $ 1,875 | $ 1,582 |