Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 06, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | VERI | |
Entity Registrant Name | Veritone, Inc. | |
Entity Central Index Key | 0001615165 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-38093 | |
Entity Tax Identification Number | 47-1161641 | |
Entity Address, Address Line One | 575 Anton Blvd. | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | Costa Mesa | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92626 | |
City Area Code | 888 | |
Local Phone Number | 507-1737 | |
Entity Common Stock, Shares Outstanding | 27,733,322 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 54,315 | $ 44,065 |
Accounts receivable, net | 17,470 | 21,352 |
Expenditures billable to clients | 20,108 | 10,286 |
Prepaid expenses and other current assets | 5,116 | 5,409 |
Total current assets | 97,009 | 81,112 |
Property, equipment and improvements, net | 2,499 | 3,214 |
Intangible assets, net | 12,086 | 16,126 |
Goodwill | 6,904 | 6,904 |
Long-term restricted cash | 855 | 855 |
Other assets | 229 | 315 |
Total assets | 119,582 | 108,526 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Accounts payable | 21,268 | 17,014 |
Accrued media payments | 41,226 | 26,664 |
Client advances | 13,767 | 9,080 |
Other accrued liabilities | 7,643 | 6,978 |
Total current liabilities | 83,904 | 59,736 |
Other non-current liabilities | 1,251 | 1,379 |
Total liabilities | 85,155 | 61,115 |
Commitments and contingencies (Note 7) | ||
Stockholders' equity | ||
Common stock, par value $0.001 per share; 75,000,000 shares authorized; 27,719,753 and 25,670,737 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively | 28 | 26 |
Additional paid-in capital | 302,321 | 279,828 |
Accumulated deficit | (267,979) | (232,489) |
Accumulated other comprehensive income | 57 | 46 |
Total stockholders' equity | 34,427 | 47,411 |
Total liabilities and stockholders' equity | $ 119,582 | $ 108,526 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 27,719,753 | 25,670,737 |
Common stock, shares outstanding | 27,719,753 | 25,670,737 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 15,718 | $ 12,805 | $ 40,890 | $ 37,200 |
Cost of revenue (exclusive of amortization shown separately below) | 4,553 | 4,196 | 11,566 | 11,725 |
Gross profit | 11,165 | 8,609 | 29,324 | 25,475 |
Operating expenses: | ||||
Sales and marketing | 5,255 | 6,081 | 15,116 | 17,921 |
Research and development | 3,587 | 5,473 | 10,673 | 18,250 |
General and administrative | 11,950 | 11,899 | 34,836 | 35,228 |
Amortization | 1,346 | 1,352 | 4,040 | 3,515 |
Total operating expenses | 22,138 | 24,805 | 64,665 | 74,914 |
Loss from operations | (10,973) | (16,196) | (35,341) | (49,439) |
Other (expense) income, net | (4) | 184 | (108) | 446 |
Loss before provision for income taxes | (10,977) | (16,012) | (35,449) | (48,993) |
Provision for (benefit from) income taxes | 36 | (1,815) | 41 | (1,799) |
Net loss | $ (11,013) | $ (14,197) | $ (35,490) | $ (47,194) |
Net loss per share: | ||||
Basic and diluted | $ (0.40) | $ (0.64) | $ (1.31) | $ (2.26) |
Weighted average shares outstanding: | ||||
Basic and diluted | 27,593,315 | 22,345,122 | 27,162,880 | 20,882,293 |
Comprehensive loss: | ||||
Net loss | $ (11,013) | $ (14,197) | $ (35,490) | $ (47,194) |
Unrealized gain on marketable securities, net of income taxes | 48 | |||
Foreign currency translation gain (loss), net of income taxes | 6 | (31) | 11 | (8) |
Total comprehensive loss | $ (11,007) | $ (14,228) | $ (35,479) | $ (47,154) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Beginning balance at Dec. 31, 2018 | $ 60,283 | $ 19 | $ 230,674 | $ (170,411) | $ 1 |
Beginning balance, shares at Dec. 31, 2018 | 19,335,220 | ||||
Common stock offerings, net | 17,531 | $ 3 | 17,528 | ||
Common stock offerings, net, shares | 2,772,600 | ||||
Common stock issued under employee stock plans, net | 722 | 722 | |||
Common stock issued under employee stock plans, net, shares | 230,979 | ||||
Machine Box holdback consideration | 760 | 760 | |||
Common stock issued for acquisitions | 3,862 | $ 1 | 3,861 | ||
Common stock issued for acquisitions, shares | 896,400 | ||||
Stock-based compensation expense | 14,794 | 14,794 | |||
Net loss | (47,194) | (47,194) | |||
Other comprehensive gain (loss) | 40 | 40 | |||
Ending balance at Sep. 30, 2019 | 50,798 | $ 23 | 268,339 | (217,605) | 41 |
Ending balance, shares at Sep. 30, 2019 | 23,235,199 | ||||
Beginning balance at Dec. 31, 2018 | 60,283 | $ 19 | 230,674 | (170,411) | 1 |
Beginning balance, shares at Dec. 31, 2018 | 19,335,220 | ||||
Net loss | (62,078) | ||||
Ending balance at Dec. 31, 2019 | 47,411 | $ 26 | 279,828 | (232,489) | 46 |
Ending balance, shares at Dec. 31, 2019 | 25,670,737 | ||||
Beginning balance at Jun. 30, 2019 | 54,499 | $ 22 | 257,813 | (203,408) | 72 |
Beginning balance, shares at Jun. 30, 2019 | 21,918,406 | ||||
Common stock offerings, net | 5,316 | $ 1 | 5,315 | ||
Common stock offerings, net, shares | 1,103,937 | ||||
Common stock issued under employee stock plans, net | 308 | 308 | |||
Common stock issued under employee stock plans, net, shares | 83,304 | ||||
Machine Box holdback consideration | 140 | 140 | |||
Common stock issued for acquisitions | 27 | 27 | |||
Common stock issued for acquisitions, shares | 129,552 | ||||
Stock-based compensation expense | 4,736 | 4,736 | |||
Net loss | (14,197) | (14,197) | |||
Other comprehensive gain (loss) | (31) | (31) | |||
Ending balance at Sep. 30, 2019 | 50,798 | $ 23 | 268,339 | (217,605) | 41 |
Ending balance, shares at Sep. 30, 2019 | 23,235,199 | ||||
Beginning balance at Dec. 31, 2019 | 47,411 | $ 26 | 279,828 | (232,489) | 46 |
Beginning balance, shares at Dec. 31, 2019 | 25,670,737 | ||||
Common stock offerings, net | 5,996 | $ 2 | 5,994 | ||
Common stock offerings, net, shares | 1,491,317 | ||||
Common stock issued under employee stock plans, net | 356 | 356 | |||
Common stock issued under employee stock plans, net, shares | 297,490 | ||||
Release of Machine Box holdback consideration, shares | 105,898 | ||||
Stock-based compensation expense | 13,735 | 13,735 | |||
Exercise of warrants | 2,100 | $ 2,100 | 2,100 | ||
Exercise of warrants, shares | 154,311 | ||||
Issuance of warrants | 308 | 308 | |||
Net loss | (35,490) | (35,490) | |||
Other comprehensive gain (loss) | 11 | 11 | |||
Ending balance at Sep. 30, 2020 | 34,427 | $ 28 | 302,321 | (267,979) | 57 |
Ending balance, shares at Sep. 30, 2020 | 27,719,753 | ||||
Beginning balance at Jun. 30, 2020 | 40,080 | $ 28 | 296,967 | (256,966) | 51 |
Beginning balance, shares at Jun. 30, 2020 | 27,516,307 | ||||
Common stock offerings, net | (10) | (10) | |||
Common stock issued under employee stock plans, net | 216 | 216 | |||
Common stock issued under employee stock plans, net, shares | 97,548 | ||||
Release of Machine Box holdback consideration, shares | 105,898 | ||||
Stock-based compensation expense | 5,148 | 5,148 | |||
Net loss | (11,013) | (11,013) | |||
Other comprehensive gain (loss) | 6 | 6 | |||
Ending balance at Sep. 30, 2020 | $ 34,427 | $ 28 | $ 302,321 | $ (267,979) | $ 57 |
Ending balance, shares at Sep. 30, 2020 | 27,719,753 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||||||
Net loss | $ (35,490) | $ (47,194) | ||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||
Depreciation and amortization | 4,816 | 4,337 | ||||
Deferred income taxes, net | (1,821) | |||||
Warrant expense | 102 | |||||
Change in fair value of warrant liability | $ (57) | 200 | (7) | |||
Provision for doubtful accounts | 291 | 54 | ||||
Stock-based compensation expense | $ 5,111 | 4,764 | 13,698 | 16,049 | ||
Other | (19) | |||||
Changes in assets and liabilities: | ||||||
Accounts receivable | 3,535 | 156 | ||||
Expenditures billable to clients | (9,822) | (3,472) | ||||
Prepaid expenses and other assets | (131) | (953) | ||||
Accounts payable | 4,254 | (5,282) | ||||
Accrued media payments | 14,562 | 3,189 | ||||
Client advances | 4,687 | 15,057 | ||||
Other accrued liabilities | 708 | 1,447 | ||||
Other liabilities | (128) | 31 | ||||
Net cash provided by (used in) operating activities | 1,282 | (18,428) | $ (30,117) | $ (41,770) | ||
Cash flows from investing activities: | ||||||
Proceeds from sales of marketable securities | 13,614 | |||||
Proceeds from the sale of equipment | 56 | |||||
Capital expenditures | (61) | (282) | ||||
Intangible assets acquired | (477) | |||||
Acquisition of businesses, net of cash acquired | (883) | |||||
Net cash (used in) provided by investing activities | (5) | 11,972 | ||||
Cash flows from financing activities: | ||||||
Proceeds from common stock offerings, net | 6,517 | 17,302 | ||||
Proceeds from loan | 6,491 | |||||
Repayment of loan | (6,491) | |||||
Proceeds from the exercise of warrants | 2,100 | |||||
Proceeds from issuances of stock under employee stock plans, net | 356 | 722 | ||||
Net cash provided by financing activities | 8,973 | 18,024 | ||||
Net increase in cash, cash equivalents and restricted cash | 10,250 | 11,568 | ||||
Cash, cash equivalents and restricted cash, beginning of period | 44,920 | 38,776 | 38,776 | |||
Cash, cash equivalents and restricted cash, end of period | $ 55,170 | $ 50,344 | $ 55,170 | $ 50,344 | $ 44,920 | $ 38,776 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Description of Business | NOTE 1. DESCRIPTION OF BUSINESS Description of Business Veritone, Inc., a Delaware corporation (“Veritone”) (together with its wholly owned subsidiaries, collectively, the “Company”), is a provider of artificial intelligence (“AI”) computing solutions. The Company’s AI platform, aiWARE TM The Company also offers cloud-native digital content management solutions and content licensing services, primarily to customers in the media and entertainment market. These offerings leverage the Company’s aiWARE technologies, providing customers with unique capabilities to enrich and drive expanded revenue opportunities from their content. In addition, the Company operates a full-service advertising agency that leverages the Company’s aiWARE technologies to provide differentiated services to its clients. The Company’s advertising services include media planning and strategy, advertisement buying and placement, campaign messaging, clearance verification and attribution, and custom analytics, specializing in host-endorsed and influencer advertising across primarily radio, podcasting, streaming audio, social media and other digital media channels. The Company’s advertising services also include its VeriAds TM |
Presentation and Summary of Sig
Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Presentation and Summary of Significant Accounting Policies | NOTE 2. PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Preparation The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial statements and the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not contain all information and footnotes required by GAAP for annual financial statements. Such unaudited condensed consolidated financial statements and accompanying notes are based on the representations of the Company’s management, who is responsible for their integrity and objectivity. The information included in this Form 10-Q should be read in conjunction with the information included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 11, 2020. Interim results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results the Company will have for the full year ending December 31, 2020. The accompanying condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which are normal, recurring and necessary to fairly state the Company’s financial position, results of operations and cash flows. All significant intercompany transactions have been eliminated in consolidation. The financial data and the other information disclosed in these notes to the condensed consolidated financial statements reflected in the three and nine month periods presented are unaudited. The December 31, 2019 balance sheet included herein was derived from the audited financial statements but does not include all disclosures or notes required by GAAP for complete financial statements. Reclassifications Certain reclassifications to other assets have been made to prior year amounts for consistency and comparability with the current year’s financial statements presentation. These reclassifications had no effect on the reported total assets and liabilities. Amortization expense, which was presented in prior year periods within cost of revenue, sales and marketing, research and development, and general and administrative operating expenses, has been reclassified and is presented as a single separate line item in operating expenses. The Company believes that this presentation more accurately reflects the Company’s cost of revenue and operating expenses. The reclassification had no effect on reported net loss. Liquidity and Capital Resources During the years ended December 31, 2019 and 2018, the Company generated negative cash flows from operations of $30,117 and $41,770, respectively, and incurred net losses of $62,078 and $61,104, respectively. In the nine months ended September 30, 2020, the Company generated cash flows from operations of $1,282 and incurred a net loss of $35,490. debt, and the exercise of common stock warrants. In the first nine months of 20 20 , the Company raised net proceeds of $ 5,996 through sales of its common stock under an E quity D istribution A greement dated June 1, 2018 (the “Equity Distribution Agreement”) . In the first nine months of 2020, the Company received net proceeds of $ 2,100 through the exercise of common stock warrants. As of September 30 , 2020, the Company’s cash and cash equivalents totaled $ 54,315 . In April 2020, the Company applied and was approved for unsecured loans under the Paycheck Protection Program (the “PPP”) established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) in the aggregate amount of $6,491. The Company believes that it qualified to apply for and receive the funds pursuant to the provisions of the CARES Act and the guidance in effect at that time. However, in light of (i) revised guidance that was issued by the Small Business Administration subsequent to the Company’s receipt of the PPP Loans, and (ii) the improvement in the Company’s business outlook and access to the capital markets, the Board of Directors of the Company determined to repay the full amount of the PPP Loans. The Company completed the repayment of the PPP Loans in May 2020. The Company expects to continue to generate net losses for the foreseeable future as it makes significant investments in developing and selling its aiWARE SaaS solutions. Also, the Company will continue to evaluate potential acquisitions of, or investments in, companies or technologies that complement its business, which acquisitions may require the use of cash. Management believes that the Company’s existing balances of cash and cash equivalents will be sufficient to meet its anticipated cash requirements for at least twelve months from the date that these financial statements are issued. However, the Company does not expect that its current cash and cash equivalents will be sufficient to support the development of its business to the point at which the Company has continued positive cash flows from operations, particularly if it uses cash to finance any acquisitions or investments in the future. The Company plans to meet its future needs for additional capital through equity and/or debt financings. Equity financings may include sales of common stock under the Company’s Equity Distribution Agreement pursuant to which the Company may offer and sell, from time to time, shares of its common stock having an aggregate available offering price of up to $18,538. Such financing may not be available on terms favorable to the Company or at all. If the Company is unable to obtain adequate financing or financing on terms satisfactory to it when required, the Company’s ability to continue to support its business growth, scale its infrastructure, develop product enhancements and to respond to business challenges could be significantly impaired. Use of Accounting Estimates The preparation of the accompanying condensed consolidated 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 as of the date of the accompanying condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The principal estimates relate to revenue recognition, allowance for doubtful accounts, purchase accounting, impairment of long lived assets, the valuation of stock awards and stock warrants and income taxes. There has been uncertainty and disruption in the global economy and financial markets due to the COVID-19 pandemic. The Company is not aware of any specific event or circumstance that would require an update to its estimates or assumptions or a revision of the carrying value of its assets or liabilities as of the date of filing of this Quarterly Report on Form 10-Q. These estimates and assumptions may change as new events occur and additional information is obtained. As a result, actual results could differ materially from these estimates and assumptions. Remaining Performance Obligations As of September 30, 2020, the aggregate amount of the transaction prices under the Company’s contracts allocated to the Company’s remaining performance obligations was $3,814, approximately 78% of which the Company expects to recognize as revenue over the next twelve months, and the remainder thereafter. This aggregate amount excludes amounts allocated to remaining performance obligations under contracts that have an original duration of one year or less and variable consideration that is allocated to remaining performance obligations. Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2019. Recently Adopted Accounting Pronouncements Effective for the Company’s fiscal year ended December 31, 2019, the Company adopted the provisions and expanded disclosure requirements described in ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“Topic 606”), • Some multi-year contracts include fixed annual price increases. Historically, the Company recognized revenue based on the price allocated to each year. Now, the Company recognizes the aggregate fixed price as revenue ratably over the full term of the contract. • Historically, certain variable consideration was recognized one month in arrears when the amount became known. These revenues are now recognized in the month in which the service is provided based on an estimate of the amount that the Company expects to be entitled to receive for the services. These revenues do not represent a material portion of the Company’s total revenue. During the year ended December 31, 2019, the Company’s quarterly financial statements were prepared using the prior revenue recognition standard, Topic 605, Revenue Recognition are presented using Topic 606. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326). which requires measurement and recognition of expected credit losses for financial assets held. This standard will be effective for the Company beginning in the first quarter of fiscal year The Company is currently evaluating the impact that this standard will have on its consolidated financial statements and related disclosures as well as the timing of adoption. In December 2019, the FASB issued ASU No. 2019-12 to simplify the accounting in ASC 740, Income Taxes |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | NOTE 3. NET LOSS PER SHARE The following table presents the computation of basic and diluted net loss per share: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Numerator Net loss $ (11,013 ) $ (14,197 ) $ (35,490 ) $ (47,194 ) Denominator Weighted-average common shares outstanding 27,606,061 22,382,973 27,180,059 20,936,860 Less: Weighted-average shares subject to repurchase (12,746 ) (37,851 ) (17,179 ) (54,567 ) Denominator for basic and diluted net loss per share 27,593,315 22,345,122 27,162,880 20,882,293 Basic and diluted net loss per share $ (0.40 ) $ (0.64 ) $ (1.31 ) $ (2.26 ) The Company reported net losses for all periods presented and, as such, all potentially dilutive shares of common stock would have been antidilutive for such periods. The table below presents the weighted-average securities (in common equivalent shares) outstanding during the periods presented that have been excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Common stock options and restricted stock units 10,022,826 10,079,101 9,954,904 9,837,968 Warrants to purchase common stock 1,592,840 1,297,151 1,521,720 1,297,151 11,615,666 11,376,252 11,476,624 11,135,119 |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Investments All Other Investments [Abstract] | |
Financial Instruments | NOTE 4. FINANCIAL INSTRUMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, the first two of which are considered observable and the last unobservable, that may be used to measure fair value, as follows: • Level 1—quoted prices (unadjusted) in active markets for identical assets or liabilities; • Level 2—inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or • 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. Cash and Cash Equivalents The Company’s money market funds are categorized as Level 1 within the fair value hierarchy. As of September 30, 2020, the Company’s cash and cash equivalents balances were as follows: Gross Cash and Unrealized Fair Cash Cost Losses Value Equivalents Cash $ 43,289 $ — $ 43,289 $ 43,289 Level 1: Money market funds 11,026 — 11,026 11,026 Total $ 54,315 $ — $ 54,315 $ 54,315 As of December 31, 2019, the Company’s cash and cash equivalents balances were as follows: Gross Cash and Unrealized Fair Cash Cost Losses Value Equivalents Cash $ 23,710 $ — $ 23,710 $ 23,710 Level 1: Money market funds 20,355 — 20,355 20,355 Total $ 44,065 $ — $ 44,065 $ 44,065 Stock Warrants All of the Company’s outstanding stock warrants are categorized as Level 3 within the fair value hierarchy. Stock warrants have been recorded at their fair value using either a probability weighted expected return model, the Monte Carlo simulation model or the Black-Scholes option-pricing model. These models incorporate contractual terms, maturity, risk-free interest rates and volatility. The value of the Company’s stock warrants would increase if a higher risk-free interest rate was used, and would decrease if a lower risk-free interest rate was used. Similarly, a higher volatility assumption would increase the value of the stock warrants, and a lower volatility assumption would decrease the value of the stock warrants. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management with the assistance of a third-party valuation specialist. In April 2020, in connection with a consulting agreement between the Company and a consulting firm, the Company issued to such firm a warrant to purchase up to 50,000 shares of the Company’s common stock (the “Compensation Warrant”). The Compensation Warrant was fully vested and exercisable upon issuance, has an exercise price of $3.01 per share and expires on December 31, 2021. The holder is able to redeem the warrant for a number of shares having a value equal to the in-the-money value of the warrant. The fair value of this stock warrant is $59, which was determined using the Black-Scholes option-pricing model and was recorded in general and administrative operating expenses in the nine months ended September 30, 2020. The Company also issued to such firm in connection with the consulting agreement an additional warrant to purchase up to 400,000 shares of the Company’s common stock (the “Performance Warrant” and collectively with the Compensation Warrant, the “2020 Stock Warrants”). The Performance Warrant has an exercise price of $3.01 per share, shall vest and become exercisable in three substantially equal installments of 133,333 shares upon the achievement of specified performance goals and/or a market condition, and expires on The following table summarizes quantitative information with respect to the significant inputs that were used to value the 2020 Stock Warrants during the nine months ended September 30, 2020: Compensation Warrant Performance Warrant Volatility 88 % 85 % Risk-free rate 0.23 % 0.34 % Term 1.7 years 3.7 years |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | NOTE 5. GOODWILL AND INTANGIBLE ASSETS, NET Goodwill The carrying amount of goodwill was $6,904 as of September 30, 2020 and December 31, 2019. Intangible Assets The following table sets forth the Company’s finite-lived intangible assets resulting from business acquisitions and other purchases, which continue to be amortized: September 30, 2020 December 31, 2019 Weighted Average Remaining Useful Life Gross Carrying Accumulated Net Carrying Gross Carrying Accumulated Net Carrying (in years) Amount Amortization Amount Amount Amortization Amount Software and technology 1.0 $ 3,582 $ (3,061 ) $ 521 $ 3,582 $ (2,171 ) $ 1,411 Licensed technology 1.0 500 (333 ) 167 500 (208 ) 292 Developed technology 2.9 9,600 (4,000 ) 5,600 9,600 (2,560 ) 7,040 Customer relationships 2.9 9,300 (3,875 ) 5,425 9,300 (2,480 ) 6,820 Trademarks and trade names 0.2 100 (93 ) 7 100 (59 ) 41 Noncompete agreements 1.8 800 (434 ) 366 800 (278 ) 522 Total 2.8 $ 23,882 $ (11,796 ) $ 12,086 $ 23,882 $ (7,756 ) $ 16,126 The following table presents future amortization of the Company’s finite-lived intangible assets at September 30, 2020: 2020 (three months) $ 1,342 2021 4,261 2022 3,963 2023 2,520 Total $ 12,086 |
Consolidated Financial Statemen
Consolidated Financial Statements Details | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Consolidated Financial Statements Details | NOTE 6. CONSOLIDATED FINANCIAL STATEMENTS DETAILS Consolidated Balance Sheets Details Cash and cash equivalents As of September 30, 2020 and December 31, 2019, the Company had cash and cash equivalents of $54,315 and $44,065, respectively, including $34,195 and $15,003, respectively, of cash received from advertising clients and content licensees for future payments to vendors. Accounts Receivable, Net Accounts receivable consisted of the following: As of September 30, December 31, 2020 2019 Accounts receivable — $ 14,553 $ 19,184 Accounts receivable — 2,354 1,269 Accounts receivable — 668 928 17,575 21,381 Less: allowance for doubtful accounts (105 ) (29 ) Accounts receivable, net $ 17,470 $ 21,352 The amount that the Company invoices and collects from advertising clients includes the cost of the advertisements placed for them with media vendors and the amount of the commission earned by the Company. The average commission earned by the Company is less than 15% of the total amount invoiced and collected from the advertising clients. Property, Equipment and Improvements, Net Property, equipment and improvements, net consisted of the following: As of September 30, December 31, 2020 2019 Property and equipment $ 2,276 $ 2,247 Leasehold improvements 2,908 2,876 5,184 5,123 Less: accumulated depreciation (2,685 ) (1,909 ) Property, equipment and improvements, net $ 2,499 $ 3,214 Depreciation expense was $264 and $776 for the three and nine months ended September 30, 2020, respectively. Depreciation expense was $271 and $822 for the three and nine months ended September 30, 2019, respectively. Accounts Payable Accounts payable consisted of the following: As of September 30, December 31, 2020 2019 Accounts payable — $ 19,961 $ 15,697 Accounts payable — 1,307 1,317 Total $ 21,268 $ 17,014 Accounts payable – Advertising reflects the amounts due to media vendors for advertisements placed on behalf of the Company’s advertising clients. Consolidated Statement of Operations and Comprehensive Loss Details Revenue Revenue for the periods presented were comprised of the following: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Advertising $ 8,764 $ 6,291 $ 21,803 $ 17,847 aiWARE SaaS Solutions 3,351 2,350 9,461 7,781 aiWARE Content Licensing and Media Services 3,603 4,164 9,626 11,572 Total revenue $ 15,718 $ 12,805 $ 40,890 $ 37,200 During the three and nine months ended September 30, 2020, the Company made $71,101 and $180,297, respectively, in gross media placements, of which $66,187 and $166,877 respectively, were billed directly to clients. Of the amounts billed directly to clients, $59,058 and $148,668 represented media-related costs netted against billings during the three and nine months ended September 30, 2020, respectively. During the three and nine months ended September 30, 2019, the Company made $55,799 and $158,370, respectively, in gross media placements, of which $51,429 and $147,989 respectively, were billed directly to clients. Of the amounts billed directly to clients, $45,668 and $131,345 represented media-related costs netted against billings during the three and nine months ended September 30, 2019, respectively. Disaggregated Revenue Revenue disaggregated was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Advertising (by service type): Agency $ 7,372 $ 6,197 $ 19,393 $ 17,753 VeriAds 1,392 94 2,410 94 Sub-total 8,764 6,291 21,803 17,847 aiWARE SaaS Solutions (by market): Media and Entertainment 2,462 2,257 7,686 6,962 Government, Legal and Compliance 537 93 1,172 819 Other Markets 352 - 603 - Sub-total 3,351 2,350 9,461 7,781 aiWARE Content Licensing and Media Services (by service type): Content Licensing 3,062 3,571 9,085 10,679 Media Services 541 593 541 893 Sub-total 3,603 4,164 9,626 11,572 Total revenue $ 15,718 $ 12,805 $ 40,890 $ 37,200 Other (Expense) Income , Net Other (expense) income, net for the periods presented was comprised of the following: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Interest income, net $ 2 $ 133 $ 84 $ 462 Change in fair value of warrant liability — 57 (200 ) 7 Other (6 ) (6 ) 8 (23 ) Other (expense) income, net $ (4 ) $ 184 $ (108 ) $ 446 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 7. COMMITMENTS AND CONTINGENCIES Leases The Company leases facilities under operating lease arrangements expiring on various dates through fiscal year 2024. Certain of the Company’s leases contain standard rent escalation and renewal clauses. Under certain leases, the Company is required to pay operating expenses in addition to base rent. Rent expense for lease payments is recognized on a straight-line basis over the lease term. As of September 30, 2020, future minimum lease payments were as follows: 2020 (three months) $ 655 2021 2,242 2022 1,884 2023 1,685 2024 1,730 Total minimum payments $ 8,196 The total rent expense for all operating leases was $748 and $2,265 for the three and nine months ended September 30, 2020, respectively. The total rent expense for all operating leases was $755 and $2,235 for the three and nine months ended September 30, 2019, respectively. Other Contingencies From time to time, the Company may be involved in litigation relating to claims arising out of its operations in the normal course of business. The Company currently is not a party to any legal proceedings, the adverse outcome of which, in management’s opinion, individually or in the aggregate, would have a material adverse effect on the Company’s results of operations, financial position or cash flows. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | NOTE 8. STOCKHOLDERS’ EQUITY (DEFICIT) Common Stock Issuances In June 2018, the Company entered into an Equity Distribution Agreement with JMP Securities as sales agent, pursuant to which it may offer and sell, from time to time, through JMP Securities, shares of its common stock having an aggregate offering price of up to $50,000. During the nine months ended September 30, 2020 and 2019, the Company issued an aggregate of 1,491,317 and 2,772,600 of shares of its common stock, respectively, which were sold pursuant to the Equity Distribution Agreement. During the nine months ended September 30, 2020 and 2019, the Company received net proceeds from such sales of $5,996 and $17,531 after deducting expenses of $281 and $601, respectively. During the nine months ended September 30, 2020, the Company issued a total of 154,311 shares of its common stock upon the exercise of warrants for an aggregate exercise price of $2,100. On September 6, 2018, the Company acquired all of the outstanding capital stock of Machine Box, Inc. (“Machine Box”). The purchase consideration for the acquisition was comprised of the initial consideration paid at closing and additional contingent amounts that were payable if Machine Box achieved certain technical development and integration milestones within 12 months after the closing of the acquisition, and 80% of such consideration was payable by issuance of shares of the Company’s common stock to the former stockholders of Machine Box. During the three months ended September 30, 2020, the Company issued an aggregate of 105,898 shares of common stock to the former stockholders of Machine Box, representing all of the shares previously held back from issuance by the Company with respect to the initial consideration and the additional contingent consideration. On August 21, 2018, the Company acquired all of the outstanding capital stock of S Media Limited (d/b/a Performance Bridge Media) (“Performance Bridge”). The purchase consideration for the acquisition was comprised of the initial consideration paid at closing and additional earnout consideration that was payable if Performance Bridge achieved certain revenue milestones for its 2018 fiscal year, and 80% of such consideration was payable by issuance of shares of the Company’s common stock to the former stockholder of Performance Bridge. During the nine months ended September 30, 2020 and 2019, the Company issued an aggregate of 297,490 shares of its common stock and 230,979 Common Stock Warrants During the nine months ended September 30, 2020, the Company issued to a consulting firm warrants to purchase up to an aggregate of 450,000 shares of its common stock. As of September 30, 2020 and December 31, 2019, the Company had outstanding warrants to purchase an aggregate of 1,592,840 and 1,297,151 shares of the Company’s common stock, respectively. |
Stock Plans
Stock Plans | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Plans | NOTE 9. STOCK PLANS Modifications to Performance-Based Stock Options In August 2020, the disinterested members of the Board of Directors of the Company adopted certain amendments (the “Amendments”) to the Company’s 2018 Performance-Based Stock Incentive Plan (the “2018 Plan”), the stock option award agreements entered into pursuant to the 2018 Plan, and certain stock option award agreements entered into pursuant to the Company’s 2017 Stock Incentive Plan (the “2017 Plan”) on substantially the same terms as the stock option award agreements entered into pursuant to the 2018 Plan (collectively, the “Performance Awards”). Such Amendments were approved by the Company’s stockholders at the Company’s annual meeting of stockholders held on July 24, 2020. The Amendments include (i) amendment of the stock price milestones applicable to the Performance Awards, and (ii) reduction of the exercise prices of the Performance Awards held by the Company’s Chief Executive Officer and the Company’s President, which resulted in a modification of the Performance Awards. The Company values the Performance Awards using a Monte Carlo simulation model. A fair value per share and a derived service period is determined for each of the three equal tranches of each Performance Award. The Company determined the fair values and the new derived service periods of the modified awards as of the date of modification and the fair values of the original awards immediately before the modification. The amount of incremental compensation expense resulting from the modification of each award is equal to the excess of the fair value of the modified award on the date of modification over the fair value of the original award immediately before the modification. The total The assumptions used in the Monte Carlo simulation model for computing the fair values of the Performance Awards on the modification date and immediately before the modification are set forth in the table below: Amendment date stock price $ 8.83 Expected volatility 80 % Risk-free interest rate 0.6 % Expected dividend yield — % Cost of equity 12 % Stock-Based Compensation During the nine months ended September 30, 2020, the Company granted options to purchase an aggregate of 610,000 shares of its common stock that are subject to time-based vesting conditions. The Company valued these stock options using the Black-Scholes Merton option pricing model. The following assumptions were used to compute the grant date fair values of the stock options granted during the nine months ended September 30, 2020: Expected term (in years) 6.0 - 6.1 Expected volatility 68% - 82% Risk-free interest rate 0.4% - 1.2% Expected dividend yield — The assumptions used in calculating the fair values of purchase rights granted under the ESPP during the nine months ended September 30, 2020 are set forth in the table below: Expected term (in years) 0.5 - 2.0 Expected volatility 65% - 130% Risk-free interest rate 0.1% - 1.5% Expected dividend yield — The Company’s stock-based compensation expense recognized for the periods presented was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Stock-based compensation expense by type of award: Restricted stock units $ 2,308 $ 251 $ 3,203 $ 748 Restricted stock awards 43 47 152 303 Machine Box contingent common stock issuances (37 ) 28 (37 ) 1,255 Performance-based stock options 1,996 2,000 5,917 5,956 Stock options 644 2,329 4,099 7,389 Employee stock purchase plan 157 109 364 398 Total $ 5,111 $ 4,764 $ 13,698 $ 16,049 Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Stock-based compensation expense by operating expense grouping: Sales and marketing $ 278 $ 281 $ 654 $ 795 Research and development 172 334 593 2,318 General and administrative 4,661 4,149 12,451 12,936 $ 5,111 $ 4,764 $ 13,698 $ 16,049 Equity Award Activity Restricted Stock Awards The Company’s restricted stock award activity for the nine months ended September 30, 2020 was as follows: Weighted Average Grant Shares Date Fair Value Unvested at December 31, 2019 22,813 $ 7.50 Granted 5,310 $ 2.98 Vested (17,960 ) $ 6.16 Unvested at September 30, 2020 10,163 $ 7.50 At September 30, 2020, total unrecognized compensation cost related to restricted stock was $14, Restricted Stock Units The Company’s restricted stock unit activity for the nine months ended September 30, 2020 was as follows: Weighted Average Grant Shares Date Fair Value Unvested at December 31, 2019 142,145 $ 6.71 Granted 835,157 $ 10.20 Forfeited (5,500 ) $ 8.81 Vested (116,295 ) $ 6.84 Unvested at September 30, 2020 855,507 $ 10.09 At September 30, 2020, total unrecognized compensation cost related to restricted stock units was $5,641, which is expected to be recognized over a weighted average period of 0.7 year. Performance-Based Stock Options The activity during the nine months ended September 30, 2020 related to stock options that are subject to performance-based vesting conditions tied to the future achievement of stock price goals by the Company was as follows: Weighted-Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at December 31, 2019 4,484,739 $ 16.68 Forfeited (298,956 ) $ 5.65 Outstanding at September 30, 2020 4,185,783 $ 10.45 7.8 years $ 3,507 Exercisable at September 30, 2020 — $ — — $ — The weighted average grant date fair values of the performance-based stock options granted during the nine months ended September 30, 2019 was $2.55 per share. No performance-based stock options were granted during the nine months ended September 30, 2020 and no performance-based stock options vested during the nine months ended September 30, 2020 and 2019. At September 30, 2020, total unrecognized compensation expense related to performance-based stock options was $18,092 and is expected to be recognized over a weighted average period of 2.0 years. Stock Options The activity during the nine months ended September 30, 2020 related to all other stock options was as follows: Weighted-Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at December 31, 2019 5,196,778 $ 13.09 Granted 610,000 $ 3.88 Exercised (59,488 ) $ 2.89 Forfeited (163,634 ) $ 8.37 Expired (158,176 ) $ 14.57 Outstanding at September 30, 2020 5,425,480 $ 12.27 7.1 years $ 6,614 Exercisable at September 30, 2020 4,211,378 $ 13.81 6.7 years $ 2,376 The weighted average grant date fair value of stock options granted during the nine months ended September 30, 2020 and 2019 was $2.46 and $3.65 per share, respectively. The aggregate intrinsic value of the options exercised during the nine months ended September 30, 2020 and 2019 was $484 and $183, respectively. The total grant date fair value of stock options vested during the nine months ended September 30, 2020 and 2019 was $4,659 and $8,056, respectively. At September 30, 2020, total unrecognized compensation expense related to stock options was $4,744 and is expected to be recognized over a weighted average period of 2.3 years. The aggregate intrinsic values in the tables above represent the difference between the fair market value of the Company’s common stock and the average option exercise price of in-the-money options, multiplied by the number of such options. Employee Stock Purchase Plan During the nine months ended September 30, 2020, a total of 126,550 shares of common stock were purchased under the Company’s ESPP. As of September 30, 2020, accrued employee contributions for future purchases under the ESPP totaled $72. |
Presentation and Summary of S_2
Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Preparation | Basis of Presentation and Preparation The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial statements and the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not contain all information and footnotes required by GAAP for annual financial statements. Such unaudited condensed consolidated financial statements and accompanying notes are based on the representations of the Company’s management, who is responsible for their integrity and objectivity. The information included in this Form 10-Q should be read in conjunction with the information included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 11, 2020. Interim results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results the Company will have for the full year ending December 31, 2020. The accompanying condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which are normal, recurring and necessary to fairly state the Company’s financial position, results of operations and cash flows. All significant intercompany transactions have been eliminated in consolidation. The financial data and the other information disclosed in these notes to the condensed consolidated financial statements reflected in the three and nine month periods presented are unaudited. The December 31, 2019 balance sheet included herein was derived from the audited financial statements but does not include all disclosures or notes required by GAAP for complete financial statements. |
Reclassification | Reclassifications Certain reclassifications to other assets have been made to prior year amounts for consistency and comparability with the current year’s financial statements presentation. These reclassifications had no effect on the reported total assets and liabilities. Amortization expense, which was presented in prior year periods within cost of revenue, sales and marketing, research and development, and general and administrative operating expenses, has been reclassified and is presented as a single separate line item in operating expenses. The Company believes that this presentation more accurately reflects the Company’s cost of revenue and operating expenses. The reclassification had no effect on reported net loss. |
Liquidity and Capital Resources | Liquidity and Capital Resources During the years ended December 31, 2019 and 2018, the Company generated negative cash flows from operations of $30,117 and $41,770, respectively, and incurred net losses of $62,078 and $61,104, respectively. In the nine months ended September 30, 2020, the Company generated cash flows from operations of $1,282 and incurred a net loss of $35,490. debt, and the exercise of common stock warrants. In the first nine months of 20 20 , the Company raised net proceeds of $ 5,996 through sales of its common stock under an E quity D istribution A greement dated June 1, 2018 (the “Equity Distribution Agreement”) . In the first nine months of 2020, the Company received net proceeds of $ 2,100 through the exercise of common stock warrants. As of September 30 , 2020, the Company’s cash and cash equivalents totaled $ 54,315 . In April 2020, the Company applied and was approved for unsecured loans under the Paycheck Protection Program (the “PPP”) established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) in the aggregate amount of $6,491. The Company believes that it qualified to apply for and receive the funds pursuant to the provisions of the CARES Act and the guidance in effect at that time. However, in light of (i) revised guidance that was issued by the Small Business Administration subsequent to the Company’s receipt of the PPP Loans, and (ii) the improvement in the Company’s business outlook and access to the capital markets, the Board of Directors of the Company determined to repay the full amount of the PPP Loans. The Company completed the repayment of the PPP Loans in May 2020. The Company expects to continue to generate net losses for the foreseeable future as it makes significant investments in developing and selling its aiWARE SaaS solutions. Also, the Company will continue to evaluate potential acquisitions of, or investments in, companies or technologies that complement its business, which acquisitions may require the use of cash. Management believes that the Company’s existing balances of cash and cash equivalents will be sufficient to meet its anticipated cash requirements for at least twelve months from the date that these financial statements are issued. However, the Company does not expect that its current cash and cash equivalents will be sufficient to support the development of its business to the point at which the Company has continued positive cash flows from operations, particularly if it uses cash to finance any acquisitions or investments in the future. The Company plans to meet its future needs for additional capital through equity and/or debt financings. Equity financings may include sales of common stock under the Company’s Equity Distribution Agreement pursuant to which the Company may offer and sell, from time to time, shares of its common stock having an aggregate available offering price of up to $18,538. Such financing may not be available on terms favorable to the Company or at all. If the Company is unable to obtain adequate financing or financing on terms satisfactory to it when required, the Company’s ability to continue to support its business growth, scale its infrastructure, develop product enhancements and to respond to business challenges could be significantly impaired. |
Use of Accounting Estimates | Use of Accounting Estimates The preparation of the accompanying condensed consolidated 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 as of the date of the accompanying condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The principal estimates relate to revenue recognition, allowance for doubtful accounts, purchase accounting, impairment of long lived assets, the valuation of stock awards and stock warrants and income taxes. There has been uncertainty and disruption in the global economy and financial markets due to the COVID-19 pandemic. The Company is not aware of any specific event or circumstance that would require an update to its estimates or assumptions or a revision of the carrying value of its assets or liabilities as of the date of filing of this Quarterly Report on Form 10-Q. These estimates and assumptions may change as new events occur and additional information is obtained. As a result, actual results could differ materially from these estimates and assumptions. |
Remaining Performance Obligations | Remaining Performance Obligations As of September 30, 2020, the aggregate amount of the transaction prices under the Company’s contracts allocated to the Company’s remaining performance obligations was $3,814, approximately 78% of which the Company expects to recognize as revenue over the next twelve months, and the remainder thereafter. This aggregate amount excludes amounts allocated to remaining performance obligations under contracts that have an original duration of one year or less and variable consideration that is allocated to remaining performance obligations. |
Significant Accounting Policies | Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2019. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Effective for the Company’s fiscal year ended December 31, 2019, the Company adopted the provisions and expanded disclosure requirements described in ASU 2014-09, Revenue from Contracts with Customers (Topic 606) (“Topic 606”), • Some multi-year contracts include fixed annual price increases. Historically, the Company recognized revenue based on the price allocated to each year. Now, the Company recognizes the aggregate fixed price as revenue ratably over the full term of the contract. • Historically, certain variable consideration was recognized one month in arrears when the amount became known. These revenues are now recognized in the month in which the service is provided based on an estimate of the amount that the Company expects to be entitled to receive for the services. These revenues do not represent a material portion of the Company’s total revenue. During the year ended December 31, 2019, the Company’s quarterly financial statements were prepared using the prior revenue recognition standard, Topic 605, Revenue Recognition are presented using Topic 606. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326). which requires measurement and recognition of expected credit losses for financial assets held. This standard will be effective for the Company beginning in the first quarter of fiscal year The Company is currently evaluating the impact that this standard will have on its consolidated financial statements and related disclosures as well as the timing of adoption. In December 2019, the FASB issued ASU No. 2019-12 to simplify the accounting in ASC 740, Income Taxes |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Common Share | The following table presents the computation of basic and diluted net loss per share: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Numerator Net loss $ (11,013 ) $ (14,197 ) $ (35,490 ) $ (47,194 ) Denominator Weighted-average common shares outstanding 27,606,061 22,382,973 27,180,059 20,936,860 Less: Weighted-average shares subject to repurchase (12,746 ) (37,851 ) (17,179 ) (54,567 ) Denominator for basic and diluted net loss per share 27,593,315 22,345,122 27,162,880 20,882,293 Basic and diluted net loss per share $ (0.40 ) $ (0.64 ) $ (1.31 ) $ (2.26 ) |
Effect of Anti-dilutive Securities | The Company reported net losses for all periods presented and, as such, all potentially dilutive shares of common stock would have been antidilutive for such periods. The table below presents the weighted-average securities (in common equivalent shares) outstanding during the periods presented that have been excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Common stock options and restricted stock units 10,022,826 10,079,101 9,954,904 9,837,968 Warrants to purchase common stock 1,592,840 1,297,151 1,521,720 1,297,151 11,615,666 11,376,252 11,476,624 11,135,119 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments All Other Investments [Abstract] | |
Schedule of Cash and Cash Equivalents | As of September 30, 2020, the Company’s cash and cash equivalents balances were as follows: Gross Cash and Unrealized Fair Cash Cost Losses Value Equivalents Cash $ 43,289 $ — $ 43,289 $ 43,289 Level 1: Money market funds 11,026 — 11,026 11,026 Total $ 54,315 $ — $ 54,315 $ 54,315 As of December 31, 2019, the Company’s cash and cash equivalents balances were as follows: Gross Cash and Unrealized Fair Cash Cost Losses Value Equivalents Cash $ 23,710 $ — $ 23,710 $ 23,710 Level 1: Money market funds 20,355 — 20,355 20,355 Total $ 44,065 $ — $ 44,065 $ 44,065 |
Summary of Quantitative Information with Respect to Significant Inputs | The following table summarizes quantitative information with respect to the significant inputs that were used to value the 2020 Stock Warrants during the nine months ended September 30, 2020: Compensation Warrant Performance Warrant Volatility 88 % 85 % Risk-free rate 0.23 % 0.34 % Term 1.7 years 3.7 years |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Finite-Lived Intangible Assets Resulting from Business Acquisitions and Other Purchases | The following table sets forth the Company’s finite-lived intangible assets resulting from business acquisitions and other purchases, which continue to be amortized: September 30, 2020 December 31, 2019 Weighted Average Remaining Useful Life Gross Carrying Accumulated Net Carrying Gross Carrying Accumulated Net Carrying (in years) Amount Amortization Amount Amount Amortization Amount Software and technology 1.0 $ 3,582 $ (3,061 ) $ 521 $ 3,582 $ (2,171 ) $ 1,411 Licensed technology 1.0 500 (333 ) 167 500 (208 ) 292 Developed technology 2.9 9,600 (4,000 ) 5,600 9,600 (2,560 ) 7,040 Customer relationships 2.9 9,300 (3,875 ) 5,425 9,300 (2,480 ) 6,820 Trademarks and trade names 0.2 100 (93 ) 7 100 (59 ) 41 Noncompete agreements 1.8 800 (434 ) 366 800 (278 ) 522 Total 2.8 $ 23,882 $ (11,796 ) $ 12,086 $ 23,882 $ (7,756 ) $ 16,126 |
Summary of Future Amortization of Finite-Lived Intangible Assets | The following table presents future amortization of the Company’s finite-lived intangible assets at September 30, 2020: 2020 (three months) $ 1,342 2021 4,261 2022 3,963 2023 2,520 Total $ 12,086 |
Consolidated Financial Statem_2
Consolidated Financial Statements Details (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Summary of Accounts Receivable, Net | Accounts receivable consisted of the following: As of September 30, December 31, 2020 2019 Accounts receivable — $ 14,553 $ 19,184 Accounts receivable — 2,354 1,269 Accounts receivable — 668 928 17,575 21,381 Less: allowance for doubtful accounts (105 ) (29 ) Accounts receivable, net $ 17,470 $ 21,352 |
Summary of Property Equipment and Improvements, Net | Property, equipment and improvements, net consisted of the following: As of September 30, December 31, 2020 2019 Property and equipment $ 2,276 $ 2,247 Leasehold improvements 2,908 2,876 5,184 5,123 Less: accumulated depreciation (2,685 ) (1,909 ) Property, equipment and improvements, net $ 2,499 $ 3,214 |
Summary of Accounts Payable | Accounts payable consisted of the following: As of September 30, December 31, 2020 2019 Accounts payable — $ 19,961 $ 15,697 Accounts payable — 1,307 1,317 Total $ 21,268 $ 17,014 |
Summary of Revenue | Revenue for the periods presented were comprised of the following: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Advertising $ 8,764 $ 6,291 $ 21,803 $ 17,847 aiWARE SaaS Solutions 3,351 2,350 9,461 7,781 aiWARE Content Licensing and Media Services 3,603 4,164 9,626 11,572 Total revenue $ 15,718 $ 12,805 $ 40,890 $ 37,200 |
Summary of Disaggregation of Revenue | Revenue disaggregated was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Advertising (by service type): Agency $ 7,372 $ 6,197 $ 19,393 $ 17,753 VeriAds 1,392 94 2,410 94 Sub-total 8,764 6,291 21,803 17,847 aiWARE SaaS Solutions (by market): Media and Entertainment 2,462 2,257 7,686 6,962 Government, Legal and Compliance 537 93 1,172 819 Other Markets 352 - 603 - Sub-total 3,351 2,350 9,461 7,781 aiWARE Content Licensing and Media Services (by service type): Content Licensing 3,062 3,571 9,085 10,679 Media Services 541 593 541 893 Sub-total 3,603 4,164 9,626 11,572 Total revenue $ 15,718 $ 12,805 $ 40,890 $ 37,200 |
Schedule of Other (Expense) Income, Net | Other (expense) income, net for the periods presented was comprised of the following: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Interest income, net $ 2 $ 133 $ 84 $ 462 Change in fair value of warrant liability — 57 (200 ) 7 Other (6 ) (6 ) 8 (23 ) Other (expense) income, net $ (4 ) $ 184 $ (108 ) $ 446 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Summary of Future Minimum Rentals Under Leases | As of September 30, 2020, future minimum lease payments were as follows: 2020 (three months) $ 655 2021 2,242 2022 1,884 2023 1,685 2024 1,730 Total minimum payments $ 8,196 |
Stock Plans (Tables)
Stock Plans (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Schedule of Stock-based Compensation Expense | The Company’s stock-based compensation expense recognized for the periods presented was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Stock-based compensation expense by type of award: Restricted stock units $ 2,308 $ 251 $ 3,203 $ 748 Restricted stock awards 43 47 152 303 Machine Box contingent common stock issuances (37 ) 28 (37 ) 1,255 Performance-based stock options 1,996 2,000 5,917 5,956 Stock options 644 2,329 4,099 7,389 Employee stock purchase plan 157 109 364 398 Total $ 5,111 $ 4,764 $ 13,698 $ 16,049 Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Stock-based compensation expense by operating expense grouping: Sales and marketing $ 278 $ 281 $ 654 $ 795 Research and development 172 334 593 2,318 General and administrative 4,661 4,149 12,451 12,936 $ 5,111 $ 4,764 $ 13,698 $ 16,049 |
Schedule of Restricted Stock Award Activity | The Company’s restricted stock award activity for the nine months ended September 30, 2020 was as follows: Weighted Average Grant Shares Date Fair Value Unvested at December 31, 2019 22,813 $ 7.50 Granted 5,310 $ 2.98 Vested (17,960 ) $ 6.16 Unvested at September 30, 2020 10,163 $ 7.50 |
Schedule of Restricted Stock Unit Activity | The Company’s restricted stock unit activity for the nine months ended September 30, 2020 was as follows: Weighted Average Grant Shares Date Fair Value Unvested at December 31, 2019 142,145 $ 6.71 Granted 835,157 $ 10.20 Forfeited (5,500 ) $ 8.81 Vested (116,295 ) $ 6.84 Unvested at September 30, 2020 855,507 $ 10.09 |
Schedule of Stock Option Activity | The activity during the nine months ended September 30, 2020 related to all other stock options was as follows: Weighted-Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at December 31, 2019 5,196,778 $ 13.09 Granted 610,000 $ 3.88 Exercised (59,488 ) $ 2.89 Forfeited (163,634 ) $ 8.37 Expired (158,176 ) $ 14.57 Outstanding at September 30, 2020 5,425,480 $ 12.27 7.1 years $ 6,614 Exercisable at September 30, 2020 4,211,378 $ 13.81 6.7 years $ 2,376 |
Employee Stock Purchase Plan [Member] | |
Summary of Fair Value Assumptions of Stock Purchase Plan | The assumptions used in calculating the fair values of purchase rights granted under the ESPP during the nine months ended September 30, 2020 are set forth in the table below: Expected term (in years) 0.5 - 2.0 Expected volatility 65% - 130% Risk-free interest rate 0.1% - 1.5% Expected dividend yield — |
2018 Performance Base Stock Incentive Plan [Member] | |
Summary of Fair Value Assumptions of Performance Awards | The assumptions used in the Monte Carlo simulation model for computing the fair values of the Performance Awards on the modification date and immediately before the modification are set forth in the table below: Amendment date stock price $ 8.83 Expected volatility 80 % Risk-free interest rate 0.6 % Expected dividend yield — % Cost of equity 12 % |
Stock Options [Member] | |
Schedule of Fair Value Assumptions | The following assumptions were used to compute the grant date fair values of the stock options granted during the nine months ended September 30, 2020: Expected term (in years) 6.0 - 6.1 Expected volatility 68% - 82% Risk-free interest rate 0.4% - 1.2% Expected dividend yield — |
Performance-based Stock Options [Member] | |
Schedule of Stock Option Activity | The activity during the nine months ended September 30, 2020 related to stock options that are subject to performance-based vesting conditions tied to the future achievement of stock price goals by the Company was as follows: Weighted-Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Term Value Outstanding at December 31, 2019 4,484,739 $ 16.68 Forfeited (298,956 ) $ 5.65 Outstanding at September 30, 2020 4,185,783 $ 10.45 7.8 years $ 3,507 Exercisable at September 30, 2020 — $ — — $ — |
Presentation and Summary of S_3
Presentation and Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 30, 2020 | |
Significant Accounting Policies [Line Items] | |||||||
Positive (negative) cash flows from operations | $ 1,282 | $ (18,428) | $ (30,117) | $ (41,770) | |||
Net loss | $ 11,013 | $ 14,197 | 35,490 | 47,194 | 62,078 | $ 61,104 | |
Accumulated deficit | 267,979 | 267,979 | 232,489 | ||||
Proceeds from common stock offerings, net | 6,517 | $ 17,302 | |||||
Proceeds from the exercise of warrants | 2,100 | ||||||
Cash and cash equivalents | 54,315 | 54,315 | $ 44,065 | ||||
Transaction price remaining performance obligations | $ 3,814 | 3,814 | |||||
Paycheck Protection Program [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Unsecured loans aggregate amount | $ 6,491 | ||||||
Equity Distribution Agreement [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Proceeds from common stock offerings, net | 5,996 | ||||||
Equity Distribution Agreement [Member] | Maximum [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Aggregate available offering price, common stock | $ 18,538 |
Presentation and Summary of S_4
Presentation and Summary of Significant Accounting Policies - Additional Information (Details 1) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-10-01 | Sep. 30, 2020 |
Significant Accounting Policies [Line Items] | |
Transaction price remaining performance obligations percentage | 78.00% |
Expected Recognition of revenue over remaining contract terms | 12 months |
Net Income Loss Per Share - Com
Net Income Loss Per Share - Computation of Basic and Diluted Net Loss Per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator | ||||||
Net loss | $ (11,013) | $ (14,197) | $ (35,490) | $ (47,194) | $ (62,078) | $ (61,104) |
Denominator | ||||||
Weighted-average common shares outstanding | 27,606,061 | 22,382,973 | 27,180,059 | 20,936,860 | ||
Less: Weighted-average shares subject to repurchase | (12,746) | (37,851) | (17,179) | (54,567) | ||
Denominator for basic and diluted net loss per share | 27,593,315 | 22,345,122 | 27,162,880 | 20,882,293 | ||
Basic and diluted net loss per share | $ (0.40) | $ (0.64) | $ (1.31) | $ (2.26) |
Net Income Loss Per Share - Eff
Net Income Loss Per Share - Effect of Anti-dilutive Securities (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of Anti-dilutive Securities | 11,615,666 | 11,376,252 | 11,476,624 | 11,135,119 |
Employee Stock Option and Restricted Stock Units [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of Anti-dilutive Securities | 10,022,826 | 10,079,101 | 9,954,904 | 9,837,968 |
Warrant [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of Anti-dilutive Securities | 1,592,840 | 1,297,151 | 1,521,720 | 1,297,151 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | $ 54,315 | $ 44,065 |
Total Cash and Debt Securities | 54,315 | 44,065 |
Total Fair Value, Cash and Debt Securities | 54,315 | 44,065 |
Cash [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 43,289 | 23,710 |
Fair Value, Cash | 43,289 | 23,710 |
Level 1 [Member] | Money Market Funds [Member] | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 11,026 | 20,355 |
Fair Value, Cash | $ 11,026 | 20,355 |
Cash and cash equivalents gross before unrealized losses | $ 20,355 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Apr. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Apr. 30, 2018 | |
Schedule Of Available For Sale Securities [Line Items] | ||||||
Warrants to purchase common stock | 1,592,840 | 1,297,151 | ||||
Fair value of warrants | $ (57) | $ 200 | $ (7) | |||
Compensation Warrant [Member] | ||||||
Schedule Of Available For Sale Securities [Line Items] | ||||||
Warrants to purchase common stock | 50,000 | |||||
Warrant exercise price | $ 3.01 | |||||
Fair value of warrants | 59 | |||||
Warrant exercisable date | Dec. 31, 2021 | |||||
Performance Warrant [Member] | ||||||
Schedule Of Available For Sale Securities [Line Items] | ||||||
Warrants to purchase common stock | 400,000 | |||||
Warrant exercise price | $ 3.01 | |||||
Fair value of warrants | $ 43 | |||||
Warrant exercisable | 133,333 | |||||
Warrant exercisable date | Dec. 31, 2023 | |||||
Performance Warrant [Member] | First Installment [Member] | ||||||
Schedule Of Available For Sale Securities [Line Items] | ||||||
Warrant exercisable | 133,333 | |||||
April 2018 Warrant [Member] | ||||||
Schedule Of Available For Sale Securities [Line Items] | ||||||
Warrants to purchase common stock | 20,000 | |||||
Warrant exercise price | $ 11.73 | |||||
Fair value of warrants | $ 207 |
Financial Instruments - Summary
Financial Instruments - Summary of Quantitative Information with Respect to Significant Inputs (Detail) | Sep. 30, 2020 |
Volatility [Member] | Compensation Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants, measurement input | 88 |
Volatility [Member] | Performance Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants, measurement input | 85 |
Risk-free Rate [Member] | Compensation Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants, measurement input | 0.23 |
Risk-free Rate [Member] | Performance Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants, measurement input | 0.34 |
Term [Member] | Compensation Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants term | 1 year 8 months 12 days |
Term [Member] | Performance Warrant [Member] | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |
Warrants term | 3 years 8 months 12 days |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Carrying amount of goodwill | $ 6,904 | $ 6,904 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Summary of Finite-Lived Intangible Assets Resulting from Business Acquisitions and Other Purchases (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 2 years 9 months 18 days | |
Gross Carrying Amount | $ 23,882 | $ 23,882 |
Accumulated Amortization | (11,796) | (7,756) |
Net Carrying Amount | $ 12,086 | 16,126 |
Software and Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 1 year | |
Gross Carrying Amount | $ 3,582 | 3,582 |
Accumulated Amortization | (3,061) | (2,171) |
Net Carrying Amount | $ 521 | 1,411 |
Licensed Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 1 year | |
Gross Carrying Amount | $ 500 | 500 |
Accumulated Amortization | (333) | (208) |
Net Carrying Amount | $ 167 | 292 |
Developed Technology [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 2 years 10 months 24 days | |
Gross Carrying Amount | $ 9,600 | 9,600 |
Accumulated Amortization | (4,000) | (2,560) |
Net Carrying Amount | $ 5,600 | 7,040 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 2 years 10 months 24 days | |
Gross Carrying Amount | $ 9,300 | 9,300 |
Accumulated Amortization | (3,875) | (2,480) |
Net Carrying Amount | $ 5,425 | 6,820 |
Trademarks and Trade Names [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 2 months 12 days | |
Gross Carrying Amount | $ 100 | 100 |
Accumulated Amortization | (93) | (59) |
Net Carrying Amount | $ 7 | 41 |
Noncompete Agreements [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life (in years) | 1 year 9 months 18 days | |
Gross Carrying Amount | $ 800 | 800 |
Accumulated Amortization | (434) | (278) |
Net Carrying Amount | $ 366 | $ 522 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Summary of Future Amortization of Finite-Lived Intangible Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Finite Lived Intangible Assets Future Amortization Expense [Abstract] | ||
2020 (three months) | $ 1,342 | |
2021 | 4,261 | |
2022 | 3,963 | |
2023 | 2,520 | |
Net Carrying Amount | $ 12,086 | $ 16,126 |
Consolidated Financial Statem_3
Consolidated Financial Statements Details - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Cash and cash equivalents | $ 54,315 | $ 54,315 | $ 44,065 | ||
Depreciation Expense | 264 | $ 271 | 776 | $ 822 | |
Cost of revenues | 4,553 | 4,196 | 11,566 | 11,725 | |
Advertising Clients and Content Licensees [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Cash received | 34,195 | $ 34,195 | $ 15,003 | ||
Advertising [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Percentage of average commission earned on amount invoiced and collected | 15.00% | ||||
Gross media placements | 71,101 | 55,799 | $ 180,297 | 158,370 | |
Advertising [Member] | Billed Revenues [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Gross media placements | 66,187 | 51,429 | 166,877 | 147,989 | |
Advertising [Member] | Netted Against Billings [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Cost of revenues | $ 59,058 | $ 45,668 | $ 148,668 | $ 131,345 |
Consolidated Financial Statem_4
Consolidated Financial Statements Details - Summary of Accounts Receivable,Net (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts receivable, gross | $ 17,575 | $ 21,381 |
Less: allowance for doubtful accounts | (105) | (29) |
Accounts receivable, net | 17,470 | 21,352 |
Advertising [Member] | ||
Accounts receivable, gross | 14,553 | 19,184 |
aiWARE SaaS Solutions [Member] | ||
Accounts receivable, gross | 2,354 | 1,269 |
aiWARE Content Licensing and Media Services [Member] | ||
Accounts receivable, gross | $ 668 | $ 928 |
Consolidated Financial Statem_5
Consolidated Financial Statements Details - Summary of Property Equipment and Improvements, Net (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Property Plant And Equipment [Abstract] | ||
Property and equipment | $ 2,276 | $ 2,247 |
Leasehold improvements | 2,908 | 2,876 |
Property, equipment and improvements, gross | 5,184 | 5,123 |
Less: accumulated depreciation | (2,685) | (1,909) |
Property, equipment and improvements, net | $ 2,499 | $ 3,214 |
Consolidated Financial Statem_6
Consolidated Financial Statements Details - Accounts Payable (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Accounts payable — Advertising | $ 19,961 | $ 15,697 |
Accounts payable — Other | 1,307 | 1,317 |
Total | $ 21,268 | $ 17,014 |
Consolidated Financial Statem_7
Consolidated Financial Statements Details - Summary of Revenue (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | $ 15,718 | $ 12,805 | $ 40,890 | $ 37,200 |
Advertising [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 8,764 | 6,291 | 21,803 | 17,847 |
aiWARE SaaS Solutions [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 3,351 | 2,350 | 9,461 | 7,781 |
aiWARE Content Licensing and Media Services [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | $ 3,603 | $ 4,164 | $ 9,626 | $ 11,572 |
Consolidated Financial Statem_8
Consolidated Financial Statements Details - Summary of Disaggregation of Revenue (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | $ 15,718 | $ 12,805 | $ 40,890 | $ 37,200 |
Advertising Agency [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 7,372 | 6,197 | 19,393 | 17,753 |
Advertising VeriAds [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 1,392 | 94 | 2,410 | 94 |
Advertising [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 8,764 | 6,291 | 21,803 | 17,847 |
aiWARE Media and Entertainment [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 2,462 | 2,257 | 7,686 | 6,962 |
aiWARE Government Legal and Compliance [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 537 | 93 | 1,172 | 819 |
aiWARE SaaS Solutions [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 3,351 | 2,350 | 9,461 | 7,781 |
aiWARE Other Markets [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 352 | 603 | ||
aiWARE Content Licensing [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 3,062 | 3,571 | 9,085 | 10,679 |
aiWARE Media Services [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | 541 | 593 | 541 | 893 |
aiWARE Content Licensing and Media Services [Member] | ||||
Segment Reporting Revenue Reconciling Item [Line Items] | ||||
Total revenue | $ 3,603 | $ 4,164 | $ 9,626 | $ 11,572 |
Consolidated Financial Statem_9
Consolidated Financial Statements Details - Schedule of Other (Expense) Income, Net (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Other Income And Expenses [Abstract] | ||||
Interest income, net | $ 2 | $ 133 | $ 84 | $ 462 |
Change in fair value of warrant liability | 57 | (200) | 7 | |
Other | (6) | (6) | 8 | (23) |
Other (expense) income, net | $ (4) | $ 184 | $ (108) | $ 446 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of Future Minimum Rentals Under Leases (Detail) - Building Lease Agreement [Member] $ in Thousands | Sep. 30, 2020USD ($) |
Other Commitments [Line Items] | |
2020 (three months) | $ 655 |
2021 | 2,242 |
2022 | 1,884 |
2023 | 1,685 |
2024 | 1,730 |
Total minimum payments | $ 8,196 |
Commitments and Contingencies_2
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | ||||
Rent expense | $ 748 | $ 755 | $ 2,265 | $ 2,235 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Mar. 28, 2019 | Sep. 06, 2018 | Aug. 21, 2018 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Jan. 25, 2019 |
Class of Stock [Line Items] | ||||||||||
Net proceeds from stock issuance | $ 6,517 | $ 17,302 | ||||||||
Exercise of warrants | $ 2,100 | |||||||||
Issued warrants to purchase | 450,000 | |||||||||
Warrants to purchase common stock | 1,592,840 | 1,592,840 | 1,297,151 | |||||||
Common Stock and Employee Stock Purchase Plan [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued in connection with stock option exercise | 297,490 | 230,979 | ||||||||
Machine Box, Inc. [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Business acquisition, effective date | Sep. 6, 2018 | |||||||||
Performance Bridge [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Business acquisition, effective date | Aug. 21, 2018 | |||||||||
JMP Securities [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Maximum aggregate sales price of shares to be issued under sale agreement. | $ 50,000 | $ 50,000 | ||||||||
Net proceeds from stock issuance | $ 5,996 | $ 17,531 | ||||||||
Common Stock [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock shares issued | 1,103,937 | 1,491,317 | 2,772,600 | |||||||
Exercise of warrants | $ 2,100 | |||||||||
Exercise of warrants, shares | 154,311 | |||||||||
Business acquisition, shares issued or issuable | 105,898 | 105,898 | ||||||||
Common Stock [Member] | Machine Box, Inc. [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Percentage of consideration payable for issuance of shares | 80.00% | |||||||||
Business acquisition, shares issued or issuable | 105,898 | 315,687 | 394,604 | |||||||
Business acquisition, shares issued or issuable, value | $ 2,389 | $ 2,389 | ||||||||
Common Stock [Member] | Machine Box, Inc. [Member] | Escrow Deposit | ||||||||||
Class of Stock [Line Items] | ||||||||||
Business acquisition, indemnification and other obligations, shares issued or issuable | 78,917 | |||||||||
Common Stock [Member] | Performance Bridge [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Percentage of consideration payable for issuance of shares | 80.00% | |||||||||
Business acquisition initial consideration, additional shares issued | 6,482 | |||||||||
Business acquisition, closing price of common stock | $ 34 | |||||||||
Business combination, common stock issued for contingent earn-out payments | $ 3,026 | |||||||||
Business combination, common stock shares issued for contingent earn-out payments | 574,231 | |||||||||
Common Stock [Member] | JMP Securities [Member] | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock shares issued | 1,491,317 | 2,772,600 | ||||||||
Stock issuance costs | $ 281 | $ 601 |
Stock Plans - Additional Inform
Stock Plans - Additional Information (Detail) | 1 Months Ended | 9 Months Ended | |
Aug. 31, 2020USD ($)Customer | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / shares | |
Employee Stock Purchase Plan [Member] | |||
Class of Stock [Line Items] | |||
Common stock were purchased under ESPP | shares | 126,550 | ||
Accrued employee contributions | $ 72,000 | ||
2018 Performance Base Stock Incentive Plan [Member] | |||
Class of Stock [Line Items] | |||
Number of employees | Customer | 215 | ||
Incremental compensation cost | $ 3,011,000 | ||
Timebased Stock Option [Member] | |||
Class of Stock [Line Items] | |||
Options granted | shares | 610,000 | ||
Restricted Stock [Member] | |||
Class of Stock [Line Items] | |||
Unrecognized cost of share-based compensation awards | $ 14,000 | ||
Cost of share-based compensation awards, recognition period | 1 month 6 days | ||
Restricted Stock Units [Member] | |||
Class of Stock [Line Items] | |||
Unrecognized cost of share-based compensation awards | $ 5,641,000 | ||
Cost of share-based compensation awards, recognition period | 8 months 12 days | ||
Performance-based Stock Options [Member] | |||
Class of Stock [Line Items] | |||
Cost of share-based compensation awards, recognition period | 2 years | ||
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 2.55 | ||
Total grant date fair value of stock options granted | $ 0 | ||
Total grant date fair value of stock options vested | 0 | $ 0 | |
Unrecognized compensation expense related to stock options | $ 18,092,000 | ||
Stock Options [Member] | |||
Class of Stock [Line Items] | |||
Options granted | shares | 610,000 | ||
Cost of share-based compensation awards, recognition period | 2 years 3 months 18 days | ||
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 2.46 | $ 3.65 | |
Total grant date fair value of stock options vested | $ 4,659,000 | $ 8,056,000 | |
Unrecognized compensation expense related to stock options | 4,744,000 | ||
Aggregate intrinsic value of the options exercised | $ 484,000 | $ 183,000 |
Stock Plans - Summary of Fair V
Stock Plans - Summary of Fair Value Assumptions of Performance Awards (Detail) - 2018 Performance Base Stock Incentive Plan [Member] | 1 Months Ended |
Aug. 31, 2020$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Amendment date stock price | $ 8.83 |
Expected volatility | 80.00% |
Risk-free interest rate | 0.60% |
Cost of equity | 12.00% |
Stock Plans - Schedule of Fair
Stock Plans - Schedule of Fair Value Assumptions (Detail) - Stock Options [Member] | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility, minimum | 68.00% |
Expected volatility, maximum | 82.00% |
Risk-free interest rate, minimum | 0.40% |
Risk-free interest rate, maximum | 1.20% |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 6 years |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 6 years 1 month 6 days |
Stock Plans - Summary of Fair_2
Stock Plans - Summary of Fair Value Assumptions of Stock Purchase Plan (Detail) - Employee Stock Purchase Plan [Member] | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility, minimum | 65.00% |
Expected volatility, maximum | 130.00% |
Risk-free interest rate, minimum | 0.10% |
Risk-free interest rate, maximum | 1.50% |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 6 years |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 2 years |
Stock Plans - Schedule of Stock
Stock Plans - Schedule of Stock-based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 5,111 | $ 4,764 | $ 13,698 | $ 16,049 |
Restricted Stock Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 2,308 | 251 | 3,203 | 748 |
Restricted Stock Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 43 | 47 | 152 | 303 |
Machine Box Contingent Common Stock Issuances [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | (37) | 28 | (37) | 1,255 |
Performance-based Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 1,996 | 2,000 | 5,917 | 5,956 |
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 644 | 2,329 | 4,099 | 7,389 |
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 157 | 109 | 364 | 398 |
Sales and Marketing [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 278 | 281 | 654 | 795 |
Research and Development [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 172 | 334 | 593 | 2,318 |
General and Administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 4,661 | $ 4,149 | $ 12,451 | $ 12,936 |
Stock Plans - Schedule of Restr
Stock Plans - Schedule of Restricted Stock Award Activity (Detail) - Restricted Stock Awards [Member] | 9 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares, Unvested, Beginning Balance | shares | 22,813 |
Shares, Granted | shares | 5,310 |
Shares, Vested | shares | (17,960) |
Shares, Unvested, Ending Balance | shares | 10,163 |
Weighted Average Grant Date Fair Value, Unvested, Beginning Balance | $ / shares | $ 7.50 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 2.98 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 6.16 |
Weighted Average Grant Date Fair Value, Unvested, Ending Balance | $ / shares | $ 7.50 |
Stock Plans - Schedule of Res_2
Stock Plans - Schedule of Restricted Stock Unit Activity (Detail) - Restricted Stock Units [Member] | 9 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares, Unvested, Beginning Balance | shares | 142,145 |
Shares, Granted | shares | 835,157 |
Shares, Forfeited | shares | (5,500) |
Shares, Vested | shares | (116,295) |
Shares, Unvested, Ending Balance | shares | 855,507 |
Weighted Average Grant Date Fair Value, Unvested, Beginning Balance | $ / shares | $ 6.71 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 10.20 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 8.81 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 6.84 |
Weighted Average Grant Date Fair Value, Unvested, Ending Balance | $ / shares | $ 10.09 |
Stock Plans - Schedule of Perfo
Stock Plans - Schedule of Performance-Based Stock Options Activity (Detail) - Performance-based Stock Options [Member] $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, Outstanding, Beginning Balance | shares | 4,484,739 |
Options Forfeited | shares | (298,956) |
Options, Outstanding, Ending Balance | shares | 4,185,783 |
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $ / shares | $ 16.68 |
Weighted-Average Exercise Price, Options Forfeited | $ / shares | 5.65 |
Weighted-Average Exercise Price, Outstanding, Ending Balance | $ / shares | $ 10.45 |
Weighted-Average Remaining Contractual Term, Outstanding | 7 years 9 months 18 days |
Weighted-Average Aggregate Intrinsic Value | $ | $ 3,507 |
Stock Plans - Schedule of Sto_2
Stock Plans - Schedule of Stock Option Activity (Detail) - Stock Options [Member] $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options, Outstanding, Beginning Balance | shares | 5,196,778 |
Options Granted | shares | 610,000 |
Options Exercised | shares | (59,488) |
Options Forfeited | shares | (163,634) |
Options Expired | shares | (158,176) |
Options, Outstanding, Ending Balance | shares | 5,425,480 |
Options Exercisable at September 30, 2020 | shares | 4,211,378 |
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $ / shares | $ 13.09 |
Weighted-Average Exercise Price, Options Granted | $ / shares | 3.88 |
Weighted-Average Exercise Price, Options Exercised | $ / shares | 2.89 |
Weighted-Average Exercise Price, Options Forfeited | $ / shares | 8.37 |
Weighted-Average Exercise Price, Options Expired | $ / shares | 14.57 |
Weighted-Average Exercise Price, Outstanding, Ending Balance | $ / shares | 12.27 |
Weighted-Average Exercise Price, Exercisable | $ / shares | $ 13.81 |
Weighted-Average Remaining Contractual Term, Outstanding | 7 years 1 month 6 days |
Weighted-Average Remaining Exercisable | 6 years 8 months 12 days |
Weighted-Average Aggregate Intrinsic Value | $ | $ 6,614 |
Weighted-Average Aggregate Intrinsic Value, Exercisable | $ | $ 2,376 |