Document and Entity Information
Document and Entity Information - $ / shares | 6 Months Ended | ||
Jun. 30, 2020 | Jul. 31, 2020 | Dec. 31, 2019 | |
Document Information [Line Items] | |||
Entity Shell Company | false | ||
Document Transition Report | false | ||
Document Quarterly Report | true | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | CDLX | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Registrant Name | CARDLYTICS, INC. | ||
Security Exchange Name | NASDAQ | ||
Document Type | 10-Q | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2020 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity File Number | 001-38386 | ||
Entity Current Reporting Status | Yes | ||
Document Fiscal Year Focus | 2020 | ||
Entity Interactive Data Current | Yes | ||
Entity Ex Transition Period | false | ||
Document Fiscal Period Focus | Q2 | ||
Entity Emerging Growth Company | true | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Central Index Key | 0001666071 | ||
Entity Common Stock, Shares Outstanding (in shares) | 27,286,104 | ||
Entity Address, City or Town | Atlanta | ||
Entity Address, Address Line One | 675 Ponce de Leon Ave. NE, Ste 6000 | ||
Entity Tax Identification Number | 26-3039436 | ||
Entity Address, State or Province | GA | ||
Entity Address, Postal Zip Code | 30308 | ||
Common stock, par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 | |
Local Phone Number | 792-5802 | ||
City Area Code | (888) |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 98,370 | $ 104,458 |
Restricted cash | 105 | 129 |
Accounts receivable, net | 36,566 | 81,452 |
Other receivables | 5,007 | 3,908 |
Prepaid expenses and other assets | 6,356 | 5,783 |
Total current assets | 146,404 | 195,730 |
Long-term assets: | ||
Property and equipment, net | 12,983 | 14,290 |
Operating Lease, Right-of-Use Asset | 10,422 | 0 |
Intangible assets, net | 407 | 389 |
Capitalized software development costs, net | 4,738 | 3,815 |
Deferred FI implementation costs, net | 6,384 | 8,383 |
Other long-term assets, net | 1,701 | 1,706 |
Total assets | 183,039 | 224,313 |
Current liabilities: | ||
Accounts payable | 1,177 | 1,229 |
Accrued liabilities: | ||
Accrued compensation | 4,904 | 8,186 |
Accrued expenses | 3,270 | 6,018 |
FI Share liability | 19,291 | 41,956 |
Consumer Incentive liability | 9,113 | 19,861 |
Deferred revenue | 969 | 1,127 |
Operating Lease, Liability, Current | 3,712 | 0 |
Current finance lease liabilities | 24 | 24 |
Total current liabilities | 42,460 | 78,401 |
Long-term liabilities: | ||
Deferred liabilities | 0 | 2,632 |
Operating Lease, Liability, Noncurrent | 10,114 | 0 |
Long-term finance lease liabilities | 0 | 13 |
Total liabilities | 52,574 | 81,046 |
Stockholders’ equity: | ||
Common stock, $0.0001 par value—100,000 shares authorized and 26,547 and 27,275 shares issued and outstanding as of December 31, 2019 and June 30, 2020, respectively. | 8 | 8 |
Additional paid-in capital | 499,663 | 480,578 |
Accumulated other comprehensive income | 2,714 | 1,312 |
Accumulated deficit | (371,920) | (338,631) |
Total stockholders’ equity | 130,465 | 143,267 |
Total liabilities and stockholders’ equity | $ 183,039 | $ 224,313 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Common stock, par or stated value per share (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 25,664,000 | 22,466,000 |
Common stock, shares outstanding (in shares) | 25,664,000 | 22,466,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 28,222 | $ 48,730 | $ 73,731 | $ 84,718 |
Costs and expenses: | ||||
FI Share and other third-party costs | 16,811 | 27,620 | 42,949 | 46,624 |
Delivery costs | 3,499 | 3,370 | 6,905 | 6,616 |
Sales and marketing expense | 10,405 | 11,047 | 21,373 | 20,384 |
Research and development expense | 3,966 | 2,782 | 7,817 | 5,723 |
General and administration expense | 11,734 | 8,340 | 22,478 | 15,340 |
Depreciation and amortization expense | 1,545 | 1,053 | 3,876 | 2,014 |
Total costs and expenses | 47,960 | 54,212 | 105,398 | 96,701 |
Operating loss | (19,738) | (5,482) | (31,667) | (11,983) |
Other expense: | ||||
Interest (expense) income, net | (10) | (338) | 274 | (642) |
Foreign currency loss | (10) | (690) | (1,896) | (199) |
Total other expense | (20) | (1,028) | (1,622) | (841) |
Loss before income taxes | (19,758) | (6,510) | (33,289) | (12,824) |
Income Tax Expense (Benefit) | 0 | 0 | 0 | |
Net loss | (19,758) | (6,510) | (33,289) | (12,824) |
Net loss attributable to common stockholders | $ (19,758) | $ (6,510) | $ (33,289) | $ (12,824) |
Net loss per share attributable to common stockholders, basic and diluted (in USD per share) | $ (0.73) | $ (0.29) | $ (1.24) | $ (0.57) |
Weighted-average common shares outstanding, basic and diluted (in shares) | 27,072 | 22,731 | 26,898 | 22,618 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (19,758) | $ (6,510) | $ (33,289) | $ (12,824) |
Other comprehensive income: | ||||
Foreign currency translation adjustments | 105 | 449 | 1,402 | 77 |
Total comprehensive loss | $ (19,653) | $ (6,061) | $ (31,887) | $ (12,747) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ (DEFICIT) EQUITY (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2018 | 22,466 | ||||
Beginning balance at Dec. 31, 2018 | $ 51,975 | $ 7 | $ 371,463 | $ 1,992 | $ (321,487) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 111 | ||||
Exercise of common stock options | 1,348 | 1,348 | |||
Stock-based compensation | 4,797 | ||||
Settlement of restricted stock (in shares) | 0 | ||||
Vesting of common stock warrants | 4,797 | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 157 | ||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 0 | 0 | |||
Other comprehensive income | 77 | 77 | |||
Ending balance (in shares) at Jun. 30, 2019 | 22,828 | ||||
Ending balance at Jun. 30, 2019 | 46,538 | $ 7 | 378,773 | 2,069 | (334,311) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 1,165 | $ 94 | 1,165 | ||
Net Income (Loss) Attributable to Parent | (12,824) | (12,824) | |||
Beginning balance (in shares) at Mar. 31, 2019 | 22,570 | ||||
Beginning balance at Mar. 31, 2019 | 47,177 | $ 7 | 373,351 | 1,620 | (327,801) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 80 | ||||
Exercise of common stock options | 1,175 | 1,175 | |||
Stock-based compensation | 3,082 | ||||
Settlement of restricted stock (in shares) | 0 | ||||
Vesting of common stock warrants | 3,082 | ||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 84 | ||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 0 | 0 | |||
Other comprehensive income | 449 | 449 | |||
Ending balance (in shares) at Jun. 30, 2019 | 22,828 | ||||
Ending balance at Jun. 30, 2019 | 46,538 | $ 7 | 378,773 | 2,069 | (334,311) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 1,165 | $ 94 | 1,165 | ||
Net Income (Loss) Attributable to Parent | (6,510) | (6,510) | |||
Beginning balance (in shares) at Dec. 31, 2019 | 26,547 | ||||
Beginning balance at Dec. 31, 2019 | $ 143,267 | $ 8 | 480,578 | 1,312 | (338,631) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 275 | 275 | |||
Exercise of common stock options | $ 5,426 | $ 5,426 | |||
Stock Issued During Period, Shares, Warrants Exercised In Period | 0 | 9 | 0 | ||
Stock-based compensation | $ 12,347 | $ 12,347 | |||
Settlement of restricted stock (in shares) | 416 | ||||
Other comprehensive income | 1,402 | 1,402 | |||
Ending balance (in shares) at Jun. 30, 2020 | 27,275 | ||||
Ending balance at Jun. 30, 2020 | 130,465 | $ 8 | 499,663 | 2,714 | (371,920) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net Income (Loss) Attributable to Parent | (33,289) | (33,289) | |||
Beginning balance (in shares) at Mar. 31, 2020 | 26,824 | ||||
Beginning balance at Mar. 31, 2020 | 138,358 | $ 8 | 487,903 | 2,609 | (352,162) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 114 | ||||
Exercise of common stock options | 2,281 | 2,281 | |||
Stock-based compensation | 8,167 | 8,167 | |||
Settlement of restricted stock (in shares) | 309 | ||||
Other comprehensive income | 105 | 105 | |||
Ending balance (in shares) at Jun. 30, 2020 | 27,275 | ||||
Ending balance at Jun. 30, 2020 | 130,465 | $ 8 | 499,663 | $ 2,714 | (371,920) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 1,312 | $ 28 | $ 1,312 | ||
Net Income (Loss) Attributable to Parent | $ (19,758) | $ (19,758) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Finance Lease, Right-of-Use Asset, Amortization | $ 1,731 | $ 0 | ||
Cash paid for interest | 32 | 771 | ||
Cash and cash equivalents | $ 98,370 | $ 32,495 | 98,370 | 32,495 |
Restricted cash | 105 | 10,254 | 105 | 10,254 |
Operating activities | ||||
Net loss | (19,758) | (6,510) | (33,289) | (12,824) |
Bad debt expense (reversal) | 151 | 402 | 1,326 | 652 |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 3,876 | 2,014 | ||
Amortization of financing costs charged to interest expense | 48 | 50 | ||
Termination of U.K. agreement expense | 13,233 | 4,780 | ||
Other non-cash expense, net | 2,073 | 351 | ||
Amortization of deferred FI implementation costs | 991 | 731 | 1,999 | 1,384 |
Change in operating assets and liabilities: | ||||
Accounts receivable | 42,460 | (7,024) | ||
Prepaid expenses and other assets | (603) | (1,622) | ||
Recovery of deferred FI implementation costs | 0 | 1,155 | 0 | 2,312 |
Accounts payable | (163) | (306) | ||
Other accrued expenses | (6,922) | 323 | ||
FI Share liability | (22,665) | 2,932 | ||
Consumer Incentive liability | (10,748) | 4,009 | ||
Net cash used in operating activities | (7,644) | (2,969) | ||
Investing activities | ||||
Acquisition of property and equipment | (1,225) | (4,019) | ||
Acquisition of patents | (30) | (5) | ||
Capitalized software development costs | (2,132) | (1,139) | ||
Net cash used in investing activities | (3,387) | (5,163) | ||
Financing activities | ||||
Principal payments of debt | (11) | (10,010) | ||
Proceeds from issuance of common stock | 5,435 | 1,213 | ||
Debt issuance costs | (13) | (93) | ||
Net cash (used in) received from financing activities | 5,411 | (8,890) | ||
Effect of exchange rates on cash, cash equivalents and restricted cash | (492) | (99) | ||
Net decrease in cash, cash equivalents and restricted cash | (6,112) | (17,121) | ||
Cash, cash equivalents, and restricted cash — Beginning of period | 104,587 | 59,870 | ||
Cash, cash equivalents, and restricted cash — End of period | 98,475 | 42,749 | 98,475 | 42,749 |
Supplemental schedule of non-cash investing and financing activities: | ||||
Amounts accrued for property and equipment | $ 452 | $ 53 | $ 452 | $ 53 |
OVERVIEW OF BUSINESS AND BASIS
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION | OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION Cardlytics, Inc. (“we,” “our,” “us,” the “Company,” or “Cardlytics”) is a Delaware corporation and was formed on June 26, 2008. We operate an advertising platform within financial institutions’ (“FIs”) digital channels, which include online, mobile, email, and various real-time notifications. Our partnerships with FIs provide us with access to their anonymized purchase data and digital banking customers. By applying advanced analytics to this aggregation of purchase data, we make it actionable, helping marketers identify, reach and influence likely buyers at scale, and measure the true sales impact of their marketing spend. We have strong relationships with leading marketers across a variety of industries, including national and regional restaurant and retail chains, large providers of cable satellite television and wireless services, and increasingly, travel and hospitality, grocery, e-commerce and luxury brands. Using our purchase intelligence presents customers with offers to save money at a time when they are thinking of their finances. We also operate in the United Kingdom through Cardlytics UK Limited, a wholly-owned and operated subsidiary registered as a private limited company in England and Wales, and in India through Cardlytics Services India Private Limited, a wholly-owned and operated subsidiary registered as a private limited company in India. Unaudited Interim Results The accompanying unaudited interim condensed consolidated financial statements and information have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all normal and recurring adjustments considered necessary to present fairly the financial position, results of operations, and cash flows for the periods presented. The results for interim periods presented are not necessarily indicative of the results to be expected for the full year due to the seasonality of our business, which has been historically impacted by higher consumer spending during the fourth quarter. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included on our Annual Report on Form 10-K ("Annual Report") for the fiscal year ended December 31, 2019 . Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant items subject to such estimates and assumptions include revenue recognition, internal-use software development costs, income taxes, stock-based compensation, allowance for doubtful accounts, income tax valuation allowance and contingencies. We base our estimates on historical experience and on assumptions that we believe are reasonable. Changes in facts or circumstances may cause us to change our assumptions and estimates in future periods and it is possible that actual results could differ from our current or revised future estimates. Internal-Use Software Development Costs During 2019 , we began capitalizing costs related to the development of new technology for building and launching marketing campaigns. In March 2020 , we redesigned certain elements of this project and wrote off development costs totaling $0.8 million recognized in depreciation and amortization expense on our condensed consolidated statement of operations. Restructuring During the first quarter of 2020, we began a strategic shift within our organization to increase productivity and optimize performance. This plan has resulted in severance and medical benefits totaling $0.4 million and $0.9 million during the three and six months ended June 30, 2020 , respectively. We recognize these costs when the extent of our actions are determined and the costs can be estimated. These charges are reflected on our condensed consolidated statement of operations as follows: $0.7 million in sales and marketing expense, $0.1 million general and administrative expense and $0.1 million in research and development expense. Severance and medical benefits of $0.2 million were paid to former employees through June 30, 2020. Impacts of COVID-19 Pandemic The COVID–19 pandemic resulted in a global slowdown of economic activity that decreased demand for a broad variety of goods and services and consumer discretionary spending, including spending by consumers with our marketers, and such decreased demand is likely to continue. Estimates and assumptions about future events and their effects cannot be determined with certainty and therefore require the exercise of judgment. Actual results could differ from those estimates and any such differences may be material to our financial statements. Revenue growth for the three and six months ended June 30, 2020 was unfavorably affected by the COVID-19 pandemic and its impact on both consumer discretionary spending and marketers' ability to spend advertising budgets on our solution. During the six months ended June 30, 2020 , we deferred $1.2 million of revenue and recorded bad debt expense of $1.3 million associated with billings to marketers that we believe are likely to be materially and adversely affected by the slowdown in economic activity resulting from the COVID-19 pandemic. We expect both a reduction in consumer spending and a reduction in marketing campaigns in the near term, which will result in a decline in our revenue and an increase in our net loss in future periods. The severity and duration of this decline is difficult to estimate given the uncertainty that the impacts of COVID-19 will continue to have on the global economy. The following table summarizes changes in the allowance for doubtful accounts (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Beginning balance $ 397 $ 1,383 $ 169 $ 255 Bad debt expense (reversal) 402 (151 ) 652 1,326 Write-offs, net of recoveries (227 ) (212 ) (249 ) (561 ) Ending balance $ 572 $ 1,020 $ 572 $ 1,020 |
RECENT ACCOUNTING STANDARDS
RECENT ACCOUNTING STANDARDS | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
RECENT ACCOUNTING STANDARDS | RECENT ACCOUNTING STANDARDS Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842) to increase the transparency and comparability among organizations as it relates to lease assets and lease liabilities, by requiring lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months, with exceptions. Effective January 1, 2020, we early adopted this guidance using a modified retrospective approach, which was required for all leases that exist at or commence after the date of the initial application with an option to use certain practical expedients. We have elected to use these practical expedients, which allow us to treat all components of our leases as a single component, not to reassess lease classification or whether an arrangement is or contains a lease and not to reassess its initial accounting for direct lease costs. The adoption of the new lease standard at January 1, 2020 resulted in the recognition of right-of-use assets and lease liabilities of $10.3 million and $13.5 million , respectively, consisting primarily of operating leases related to the rental of office and data center space. The adoption of this guidance did not have a significant impact on our condensed consolidated statements of operations or cash flows. On January 1, 2020, we adopted ASU 2015-05, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement , to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The adoption of this guidance did not have a material effect on our condensed consolidated financial statements. On January 1, 2020, we adopted ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract , which addresses the accounting for implementation, setup and other upfront costs incurred in a hosting arrangement. The adoption of this guidance did not have a material effect on our condensed consolidated financial statements. Except for the adoption of ASU 2016-02, ASU 2015-05 and ASU 2018-15, there have been no changes to our accounting policies, and these unaudited interim condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare our audited annual consolidated financial statements for the year ended December 31, 2019, and include, in the opinion of management, all adjustments, consisting of normal recurring items, necessary for the fair statement of the condensed consolidated financial statements. |
REVENUE (Notes)
REVENUE (Notes) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Cardlytics Direct is our bank advertising channel that enables marketers to reach consumers through the FIs' trusted and frequently visited online and mobile banking channels. Working with the marketer, we design a campaign that targets customers based on their purchase history. The consumer is offered an incentive to make a purchase from the marketer within a specified period. We use a portion of the fees that we collect from marketers to provide these consumer incentives to our FIs’ customers after they make qualifying purchases ("Consumer Incentives"). Leveraging our powerful purchase intelligence platform, we are able to create compelling Consumer Incentives that have the potential to increase return on advertising spend for marketers and measure the effectiveness of the advertising. Consumer Incentives totaled $25.0 million and $11.3 million during the three months ended June 30, 2019 and 2020 , respectively, and totaled $47.6 million and $33.6 million during the six months ended June 30, 2019 and 2020 , respectively. We generally pay our FI partners an FI Share, which is a negotiated and fixed percentage of our billings to marketers less any Consumer Incentives that we pay to FIs’ customers and certain third-party data costs. Revenue on our condensed consolidated statements of operation is presented net of Consumer Incentives and gross of FI Share. Cardlytics Direct is priced predominantly in two ways: (1) Cost per Served Sale (“CPS”), and (2) Cost per Redemption (“CPR”). • CPS. Our primary pricing model is CPS, which we created to meet the media buying preferences of marketers. We generate revenue by charging a percentage of all purchases from the marketer by consumers (1) who are served marketing and (2) subsequently make a purchase from the marketer during the campaign period, regardless of whether consumers select the marketing and thereby becomes eligible to earn the applicable Consumer Incentive. We set CPS rates for marketers based on our expectation of the marketer’s return on spend for the relevant campaign. Additionally, we set the amount of the Consumer Incentives payable for each campaign based on our estimation of our ability to drive incremental sales for the marketer. • CPR. Under our CPR pricing model, marketers specify and fund the Consumer Incentive and pay us a separate negotiated, fixed marketing fee for each purchase that we generate. We generate revenue if the consumer (1) is served marketing, (2) selects the marketing and thereby becomes eligible to earn the applicable Consumer Incentive and (3) makes a qualifying purchase from the marketer during the campaign period. We set the CPR fee for marketers based on our estimation of the marketers’ return on spend for the relevant campaign. The following table summarizes revenue by pricing model (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Cost per Served Sale $ 33,549 $ 20,353 $ 54,558 $ 51,199 Cost per Redemption 14,276 7,339 28,240 21,407 Other 905 530 1,920 1,125 Revenue $ 48,730 $ 28,222 $ 84,718 $ 73,731 |
LEASES (Notes)
LEASES (Notes) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Lessee, Operating Leases [Text Block] | LEASES Effective January 1, 2020, we early adopted ASU 2016-02, Leases (Topic 842) . This standard requires us to recognize a right-of-use asset and a lease liability for all leases with an initial term in excess of twelve months. The asset reflects the present value of unpaid fixed lease payments coupled with initial direct costs, prepaid lease payments, and lease incentives. The amount of the lease liability is calculated as the present value of unpaid fixed lease payments. We evaluate each of our lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if we obtain substantially all of the economic benefits of and have the right to control the use of an asset for a period of time. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease agreement. Lease costs are recognized as expense on a straight-line basis over the lease term. We consider a termination or renewal option in the determination of the lease term when it is reasonably certain that we will exercise that option. We adopted ASU 2016-02 using a modified retrospective approach and did not restate comparative periods. We elected to take the package of practical expedients allowing us to not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases and (iii) initial direct costs for any existing leases. We have elected to account for all components in a contract as part of the single lease component to which they are related. Significant assumptions and judgments in calculating the right-of-use assets and lease liability include the determination of the applicable borrowing rate for each lease. Because our leases generally do not provide a readily determinable implicit interest rate, we use an incremental borrowing rate to measure the lease liability and associated right-of-use asset at the lease commencement date. The incremental borrowing rate used is a fully collateralized rate that considers our credit rating, market conditions and the term of the lease at the lease commencement date. Upon the adoption of ASU 2016-02, we recorded right-of-use assets of $10.3 million , lease liabilities of $13.5 million and eliminated deferred rent liabilities of $3.2 million . As of the adoption date, our office and data center leases have remaining lease terms ranging from one to six years. During the three months ended June 30, 2020 , we renewed certain data center lease agreements resulting in a lease modification and the recognition of additional right-of-use assets and lease liabilities of $2.1 million . During the six months ended June 30, 2020 , we made cash payments of $1.7 million for operating leases which are included in cash flows from operating activities in our consolidated statement of cash flows. The following table summarizes activity related to our leases (in thousands): Three Months Ended Six Months Ended Operating lease expense $ 886 $ 1,913 Variable lease expense 175 472 Short-term lease expense 45 157 The following table presents our weighted average borrowing rate and weighted average lease term: June 30, 2020 Weighted average borrowing rate 3.4 % Weighted average remaining lease term (years) 3.81 The following table summarizes future maturities of lease liabilities as of June 30, 2020 |
Lessee, Finance Leases [Text Block] | LEASES Effective January 1, 2020, we early adopted ASU 2016-02, Leases (Topic 842) . This standard requires us to recognize a right-of-use asset and a lease liability for all leases with an initial term in excess of twelve months. The asset reflects the present value of unpaid fixed lease payments coupled with initial direct costs, prepaid lease payments, and lease incentives. The amount of the lease liability is calculated as the present value of unpaid fixed lease payments. We evaluate each of our lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if we obtain substantially all of the economic benefits of and have the right to control the use of an asset for a period of time. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease agreement. Lease costs are recognized as expense on a straight-line basis over the lease term. We consider a termination or renewal option in the determination of the lease term when it is reasonably certain that we will exercise that option. We adopted ASU 2016-02 using a modified retrospective approach and did not restate comparative periods. We elected to take the package of practical expedients allowing us to not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases and (iii) initial direct costs for any existing leases. We have elected to account for all components in a contract as part of the single lease component to which they are related. Significant assumptions and judgments in calculating the right-of-use assets and lease liability include the determination of the applicable borrowing rate for each lease. Because our leases generally do not provide a readily determinable implicit interest rate, we use an incremental borrowing rate to measure the lease liability and associated right-of-use asset at the lease commencement date. The incremental borrowing rate used is a fully collateralized rate that considers our credit rating, market conditions and the term of the lease at the lease commencement date. Upon the adoption of ASU 2016-02, we recorded right-of-use assets of $10.3 million , lease liabilities of $13.5 million and eliminated deferred rent liabilities of $3.2 million . As of the adoption date, our office and data center leases have remaining lease terms ranging from one to six years. During the three months ended June 30, 2020 , we renewed certain data center lease agreements resulting in a lease modification and the recognition of additional right-of-use assets and lease liabilities of $2.1 million . During the six months ended June 30, 2020 , we made cash payments of $1.7 million for operating leases which are included in cash flows from operating activities in our consolidated statement of cash flows. The following table summarizes activity related to our leases (in thousands): Three Months Ended Six Months Ended Operating lease expense $ 886 $ 1,913 Variable lease expense 175 472 Short-term lease expense 45 157 The following table presents our weighted average borrowing rate and weighted average lease term: June 30, 2020 Weighted average borrowing rate 3.4 % Weighted average remaining lease term (years) 3.81 The following table summarizes future maturities of lease liabilities as of June 30, 2020 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT 2018 Loan Facility On May 14, 2019, we amended our loan facility with Pacific Western Bank to increase the capacity of our asset-based revolving line of credit ("2018 Line of Credit") and decreased the capacity of our term loan ("2018 Term Loan"). This amendment also extended the maturity date of the term loan from May 21, 2020 to May 14, 2021. We repaid $10.0 million of the principal balance of the 2018 Term Loan upon the execution of the amendment in May 2019 and repaid the remaining $10.0 million principal balance in September 2019. As of June 30, 2020 , we had $26.4 million of unused borrowings available under our 2018 Line of Credit and had no outstanding borrowings. Under the amended terms, we are able to borrow up to the lesser of $40.0 million or 85% of the amount of our eligible accounts receivable. Interest on advances bears an interest rate equal to the prime rate minus 0.50% , or 2.75% as of June 30, 2020 . In addition, we are required to pay an unused line fee of 0.15% per annum on the average daily unused amount of the $40.0 million revolving commitment. Interest accrued on the 2018 Term Loan at an annual rate of interest equal to the prime rate minus 2.75% , or 2.00% at the date of repayment in September 2019. We believe that we were in compliance with all financial covenants as of June 30, 2020 . |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Our board of directors has adopted and our stockholders have approved our 2018 Equity Incentive Plan ("2018 Plan"). Our 2018 Plan became effective on February 8, 2018, the date our registration statement in connection with our initial public offering ("IPO") was declared effective. We do not expect to grant any additional awards under our 2008 Stock Plan ("2008 Plan"). Any awards granted under the 2008 Plan will remain subject to the terms of our 2008 Plan and applicable award agreements. Initially, the aggregate number of shares of our common stock that may be issued pursuant to stock awards under the 2018 Plan is the sum of (i) 1,875,000 shares plus (ii) 61,247 shares reserved, and remaining available for issuance, under our 2008 Plan at the time our 2018 Plan became effective and (iii) the number of shares subject to stock options or other stock awards granted under our 2008 Plan that would have otherwise returned to our 2008 Plan (such as upon the expiration or termination of a stock award prior to vesting). As of December 31, 2019, there were 1,345,631 shares of our common stock reserved for issuance under our 2018 Plan. The number of shares of our common stock reserved for issuance under our 2018 Plan will automatically increase on January 1 of each year, beginning on January 1, 2019 and continuing through and including January 1, 2028, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors. Accordingly, the number of shares of our common stock reserved for issuance under our 2018 Plan increased by 1,327,352 shares on January 1, 2020. The following table summarizes the allocation of stock-based compensation in the consolidated statements of operations (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Delivery costs $ 199 $ 357 $ 363 $ 532 Sales and marketing expense 952 2,567 1,659 3,836 Research and development expense 363 1,401 566 2,004 General and administration expense 1,558 4,783 2,192 6,861 Total stock-based compensation expense $ 3,072 $ 9,108 $ 4,780 $ 13,233 During the six months ended June 30, 2019 and 2020 , we capitalized less than $0.1 million and $0.2 million of stock-based compensation expense for software development, respectively. During the three months ended June 30, 2020 , we accrued $1.1 million of stock-based compensation for bonus and commissions in lieu of cash compensation which has not been settled as of June 30, 2020. This amount is presented within accrued compensation on our condensed consolidated balance sheet. Common Stock Options Options to purchase shares of common stock generally vest over four years and expire 10 years following the date of grant. The following table summarizes changes in common stock options: Shares (in thousands) Weighted-Average Exercise Price Weighted Average Contractual Life (in years) Aggregate Intrinsic Value (1) Options outstanding — December 31, 2019 1,000 $ 22.99 Granted — — Exercised (275 ) 19.71 $ 14,956 Forfeited (9 ) 28.71 Canceled (1 ) 28.96 Options outstanding — June 30, 2020 715 24.17 6.12 $ 32,752 Exercisable — June 30, 2020 607 $ 23.87 5.99 $ 27,983 (1) The aggregate intrinsic value represents the total pre-tax intrinsic value based on the $69.98 per share closing price of our common stock as reported on the Nasdaq Global Market on June 30, 2020 , that would have been received by option holders had all in-the-money options been exercised on that date. The total fair value of options vested during the six months ended June 30, 2020 was approximately $1.4 million . As of June 30, 2020, unamortized stock-based compensation expense related to unvested common stock options was $1.3 million , and the weighted-average period over which such stock-based compensation expense will be recognized was 0.7 years. Restricted Stock Units We grant restricted stock units ("RSUs") to employees and our non-employee directors. The following table summarizes changes in RSUs, inclusive of performance-based RSUs: Shares (in thousands) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term (in years) Unamortized Compensation Costs Unvested — December 31, 2019 1,741 $ 18.55 Granted 1,544 38.29 Vested (416 ) 18.88 Forfeited (242 ) 22.16 Unvested — June 30, 2020 2,627 $ 29.76 3.42 $ 64,036 During the six months ended June 30, 2020 , we granted 1,057,978 RSUs to employees, executives and non-employee directors, which have annual vesting periods ranging from one to four years. During the three months ended June 30, 2020 , we granted 9,278 immediately vesting RSUs to employees for bonus in lieu of cash compensation. Stock-based compensation related to these grants totaled $0.6 million . Subsequent to June 30, 2020 , we granted 91,593 RSUs to employees and a new director, which have annual vesting periods ranging from one to four years. The unamortized stock-based compensation expense related to these RSUs is $6.1 million . In addition, we expect to recognize $2.0 million of stock-based compensation in the third quarter of 2020 related to the accelerated vesting of certain RSU and performance-based RSU awards for which the performance-based vesting condition has been met. Performance-based RSUs In April 2019, we granted 1,252,500 performance-based restricted stock units (“2019 PSUs”). The 2019 PSUs are composed of four equal tranches, each of which have an independent performance-based vesting condition. The vesting criteria for the four tranches are as follows: • a minimum growth rate in adjusted contribution over a trailing 12-month period, • a minimum number of advertisers that are billed above a specified amount over a trailing 12-month period, • a minimum cumulative adjusted EBITDA target over a trailing 12-month period, and • a minimum trailing 30-day average closing price of our common stock. The vesting conditions of each of the four tranches must be achieved within four years of the grant date. Upon a vesting event, 50% of the related tranche vests immediately, 25% of the related tranche vests six months after achievement date and 25% of the related tranche vests 12 months after the achievement date. Adjusted EBITDA and adjusted contribution are performance metrics defined within Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations." In August and November 2019, the compensation committee of our board of directors certified that the target minimum trailing 30-day average closing price of our common stock and target minimum cumulative adjusted EBITDA target over a trailing 12-month period, respectively, were achieved resulting in the immediate vesting of 50% of the related PSU tranches. In February 2020, 25% of the 30-day average closing price of our common stock PSU tranche vested upon the six-month anniversary of the tranche's achievement date. In May 2020, 25% of the adjusted EBITDA tranche vested upon the six-month anniversary of the tranche's achievement date. In April 2020, we granted 476,608 performance-based restricted stock units ("2020 PSUs"), of which 443,276 units have a performance-based vesting condition based on a minimum average Cardlytics Direct revenue per user ("ARPU") target over a trailing 12-month period and 33,332 units have the same performance-based vesting conditions as those that remain unmet under the 2019 PSUs described above. ARPU is a performance metric defined within Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations." The ARPU vesting condition must be achieved within four years of the grant date. Upon the vesting event, 50% of the award vests immediately, 25% of the award vests six months after achievement date and 25% of the award vests 12 months after the achievement date. Employee Stock Purchase Plan Our 2018 Employee Stock Purchase Plan ("2018 ESPP") enables eligible employees to purchase shares of our common stock at a discount. Purchases are accomplished through participation in discrete offering periods. On each purchase date, participating employees purchase our common stock at a price per share equal to 85% of the lesser of the fair market value of our common stock on the first trading day of the offering period or the date of purchase. As of December 31, 2019, 267,823 shares of common stock were reserved for issuance pursuant to our 2018 ESPP. Additionally, the number of shares of our common stock reserved for issuance under our 2018 ESPP will automatically increase on January 1 of each year, which began on January 1, 2019 and will continue through and including January 1, 2026, by the lesser of (i) 1% of the total number of shares of our common stock outstanding on December 31 of the preceding calendar year, (ii) 500,000 shares of our common stock or (iii) such lesser number of shares of common stock as determined by our board of directors. Accordingly, the number of shares of our common stock reserved for issuance under our 2018 ESPP increased by 265,470 shares on January 1, 2020. Shares subject to purchase rights granted under our 2018 ESPP that terminate without having been issued in full will not reduce the number of shares available for issuance under our 2018 ESPP. In May 2020, we issued 28,097 shares pursuant to our 2018 ESPP. |
RELATED PARTIES
RELATED PARTIES | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | RELATED PARTIES Agreements with Fidelity Information Services, LLC We are party to a reseller agreement with Fidelity Information Services, LLC ("FIS"). Pursuant to the reseller agreement, FIS markets and sells our services to financial institutions that are current or potential customers of FIS in exchange for a revenue share percentage. In 2013, FIS purchased shares of our redeemable convertible preferred stock and we also granted performance-based warrants to purchase preferred stock with accelerated vesting upon an IPO. Since FIS did not participate in a subsequent financing, their warrants to purchase preferred stock were converted to warrants to purchase common stock. The warrants vested upon the completion of our IPO in February 2018, resulting in a non-cash expense of $2.5 million based on the vesting-date fair value of our common stock underlying these warrants. In September 2019, FIS exercised all of their warrants to purchase common stock, resulting in cash proceeds of $15.2 million and the issuance of 644,365 shares of our common stock. As of September 2019, FIS was no longer a related party. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES FI Implementation Costs Agreements with certain FI partners require us to fund the development of user interface enhancements, pay for certain implementation fees, or make milestone payments upon the deployment of our solution. Amounts paid to FI partners are included in deferred FI implementation costs on our condensed consolidated balance sheets the earlier of when paid or earned and are amortized over the remaining term of the related contractual arrangements. Amortization is included in FI Share and other third-party costs on our condensed consolidated statements of operations and is presented in amortization of deferred FI implementation costs on our condensed consolidated statement of cash flows. Certain of these agreements provide for future reductions in FI Share due to the FI partner. These reductions in FI Share are recorded as a reduction to deferred FI implementation costs and also result in a cumulative adjustment to accumulated amortization. The scheduled FI Share payment reductions were completed in December 2019. The following table summarizes changes in deferred FI implementation costs (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Beginning balance $ 14,067 $ 7,375 $ 15,877 $ 8,383 Recoveries through FI Share (1,155 ) — (2,312 ) — Amortization (731 ) (991 ) (1,384 ) (1,999 ) Ending balance $ 12,181 $ 6,384 $ 12,181 $ 6,384 We have an FI Share commitment to a certain FI partner totaling $10.0 million over a 12-month period following the completion of certain milestones by the FI partner, which were not met as of June 30, 2020 . Any expected shortfall will be accrued during the 12-month period following the completion of the milestones. Litigation From time to time, we may become involved in legal actions arising in the ordinary course of business including, but not limited to, intellectual property infringement and collection matters. We make assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters using the latest information available. We record a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range. If no amount within the range is a better estimate than any other amount, we accrue the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably estimated, we disclose the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss is material, we disclose the nature and estimate of the possible loss of the litigation. We do not disclose information with respect to litigation where an unfavorable outcome is considered to be remote or where the estimated loss would not be material. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on our liquidity, results of operations, business or financial condition. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Diluted net loss per share is the same as basic net loss per share for the six months ended June 30, 2019 and 2020 because the effects of potentially dilutive items were anti-dilutive, given our net loss during these periods. The following securities as of June 30, 2019 and June 30, 2020 have been excluded from the calculation of diluted weighted-average common shares outstanding because the effect is anti-dilutive (in thousands): June 30, 2019 2020 Common stock options 1,620 715 Common stock warrants 868 — Unvested restricted stock units 1,846 2,627 Common stock issuable pursuant to the ESPP 22 9 |
SEGMENTS
SEGMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENTS | SEGMENTS As of June 30, 2020 , we have two operating segments: Cardlytics Direct in the U.S. and U.K., as determined by the information that our Chief Executive Officer, who we consider our chief operating decision-maker, uses to make strategic goals and operating decisions. Our Cardlytics Direct operating segments in the U.S. and U.K. represent our proprietary native bank advertising channels and are aggregated into one reportable segment given their similar economic characteristics, nature of service, types of customers and method of distribution. Our chief operating decision maker allocates resources to, and evaluates the performance of, our operating segments based on revenue and adjusted contribution. The following table provides information regarding our Cardlytics Direct reportable segment (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Adjusted contribution $ 21,841 $ 12,402 $ 39,478 $ 32,781 Plus: Adjusted FI Share and other third-party costs (1) 26,889 15,820 45,240 40,950 Revenue $ 48,730 $ 28,222 $ 84,718 $ 73,731 (1) Adjusted FI Share and other third-party costs presented above represents GAAP FI Share and other third-party data costs less amortization of deferred FI implementation costs, which is detailed below in our reconciliation of GAAP loss before income taxes to adjusted contribution. Adjusted Contribution Adjusted contribution measures the degree by which revenue generated from our marketers exceeds the cost to obtain the purchase data and the digital advertising space from our FI partners. Adjusted contribution demonstrates how incremental marketing spend on our platform generates incremental amounts to support our sales and marketing, research and development, general and administration and other investments. Adjusted contribution is calculated by taking our total revenue less our FI Share and other third-party costs exclusive of amortization of deferred FI implementation costs, which is a non-cash cost. Adjusted contribution does not take into account all costs associated with generating revenue from advertising campaigns, including sales and marketing expenses, research and development expenses, general and administrative expenses and other expenses, which we do not take into consideration when making decisions on how to manage our advertising campaigns. The following table presents a reconciliation of loss before income taxes presented in accordance with GAAP to adjusted contribution (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Adjusted contribution $ 21,841 $ 12,402 $ 39,478 $ 32,781 Minus: Amortization of deferred FI implementation costs (1) 731 991 1,384 1,999 Delivery costs 3,370 3,499 6,616 6,905 Sales and marketing expense 11,047 10,405 20,384 21,373 Research and development expense 2,782 3,966 5,723 7,817 General and administration expense 8,340 11,734 15,340 22,478 Depreciation and amortization expense 1,053 1,545 2,014 3,876 Total other expense 1,028 20 841 1,622 Loss before income taxes $ (6,510 ) $ (19,758 ) $ (12,824 ) $ (33,289 ) (1) Amortization of deferred FI implementation costs is excluded from adjusted FI Share and other third-party costs, which is shown above in our reconciliation of GAAP revenue to adjusted contribution. The following tables provide geographical information (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Revenue: United States $ 43,123 $ 26,750 $ 74,471 $ 66,778 United Kingdom 5,607 1,472 10,247 6,953 Total $ 48,730 $ 28,222 $ 84,718 $ 73,731 December 31, 2019 June 30, 2020 Property and equipment, net: United States $ 12,052 $ 10,465 United Kingdom 2,010 2,338 India 228 180 Total $ 14,290 $ 12,983 Capital expenditures within the United Kingdom and India were $0.3 million and $0.4 million during the six months ended June 30, 2019 and 2020 , respectively. Concentrations of Risk Customers Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. A substantial majority of our cash and cash equivalents are held in fully FDIC–insured demand deposit accounts that distribute funds, and credit risk, over a vast number of financial institutions. Our remaining cash and cash equivalents are held with three financial institutions, which we believe are of high credit quality. Our accounts receivable are diversified among a large number of marketers segregated by both geography and industry. One marketer represented 10% and 17% of our revenue during the six months ended June 30, 2019 and 2020 , respectively. This marketer also represented 24% of our accounts receivable as of June 30, 2020 . A different marketer represented 12% of our accounts receivable as of June 30, 2019 . FI Partners Our business is substantially dependent on a limited number of FI partners. We require participation from our FI partners in Cardlytics Direct and access to their purchase data in order to offer our solutions to marketers and their agencies. We must have FI partners with a sufficient number of customers and levels of customer engagement to ensure that we have robust purchase data and marketing space to support a broad array of incentive programs for marketers. Our agreements with a substantial majority of our FI partners have terms of three to seven years but are generally terminable by the FI partner on 90 days or less prior notice. If an FI partner terminates its agreement with us, we would lose that FI as a source of purchase data and online banking customers. During both the six months ended June 30, 2019 and 2020 , Bank of America, National Association (“Bank of America”) and JPMorgan Chase Bank, National Association (“Chase”) combined to account for over 75% of the total FI Share we paid to all FIs, with each representing over 30% . No other FI partner accounted for over 10% of FI Share during these periods. |
OVERVIEW OF BUSINESS AND BASI_2
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Unaudited Interim Results | Unaudited Interim Results The accompanying unaudited interim condensed consolidated financial statements and information have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all normal and recurring adjustments considered necessary to present fairly the financial position, results of operations, and cash flows for the periods presented. The results for interim periods presented are not necessarily indicative of the results to be expected for the full year due to the seasonality of our business, which has been historically impacted by higher consumer spending during the fourth quarter. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included on our Annual Report on Form 10-K ("Annual Report") for the fiscal year ended December 31, 2019 . |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Significant items subject to such estimates and assumptions include revenue recognition, internal-use software development costs, income taxes, stock-based compensation, allowance for doubtful accounts, income tax valuation allowance and contingencies. We base our estimates on historical experience and on assumptions that we believe are reasonable. Changes in facts or circumstances may cause us to change our assumptions and estimates in future periods and it is possible that actual results could differ from our current or revised future estimates. |
Internal-Use Software Development Costs | Internal-Use Software Development Costs During 2019 , we began capitalizing costs related to the development of new technology for building and launching marketing campaigns. In March 2020 , we redesigned certain elements of this project and wrote off development costs totaling $0.8 million recognized in depreciation and amortization expense on our condensed consolidated statement of operations. |
Revenue | Cardlytics Direct is our bank advertising channel that enables marketers to reach consumers through the FIs' trusted and frequently visited online and mobile banking channels. Working with the marketer, we design a campaign that targets customers based on their purchase history. The consumer is offered an incentive to make a purchase from the marketer within a specified period. We use a portion of the fees that we collect from marketers to provide these consumer incentives to our FIs’ customers after they make qualifying purchases ("Consumer Incentives"). Leveraging our powerful purchase intelligence platform, we are able to create compelling Consumer Incentives that have the potential to increase return on advertising spend for marketers and measure the effectiveness of the advertising. Consumer Incentives totaled $25.0 million and $11.3 million during the three months ended June 30, 2019 and 2020 , respectively, and totaled $47.6 million and $33.6 million during the six months ended June 30, 2019 and 2020 , respectively. We generally pay our FI partners an FI Share, which is a negotiated and fixed percentage of our billings to marketers less any Consumer Incentives that we pay to FIs’ customers and certain third-party data costs. Revenue on our condensed consolidated statements of operation is presented net of Consumer Incentives and gross of FI Share. Cardlytics Direct is priced predominantly in two ways: (1) Cost per Served Sale (“CPS”), and (2) Cost per Redemption (“CPR”). • CPS. Our primary pricing model is CPS, which we created to meet the media buying preferences of marketers. We generate revenue by charging a percentage of all purchases from the marketer by consumers (1) who are served marketing and (2) subsequently make a purchase from the marketer during the campaign period, regardless of whether consumers select the marketing and thereby becomes eligible to earn the applicable Consumer Incentive. We set CPS rates for marketers based on our expectation of the marketer’s return on spend for the relevant campaign. Additionally, we set the amount of the Consumer Incentives payable for each campaign based on our estimation of our ability to drive incremental sales for the marketer. • CPR. Under our CPR pricing model, marketers specify and fund the Consumer Incentive and pay us a separate negotiated, fixed marketing fee for each purchase that we generate. We generate revenue if the consumer (1) is served marketing, (2) selects the marketing and thereby becomes eligible to earn the applicable Consumer Incentive and (3) makes a qualifying purchase from the marketer during the campaign period. We set the CPR fee for marketers based on our estimation of the marketers’ return on spend for the relevant campaign. |
OVERVIEW OF BUSINESS AND BASI_3
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Changes in Allowance for Doubtful Accounts | The following table summarizes changes in the allowance for doubtful accounts (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Beginning balance $ 397 $ 1,383 $ 169 $ 255 Bad debt expense (reversal) 402 (151 ) 652 1,326 Write-offs, net of recoveries (227 ) (212 ) (249 ) (561 ) Ending balance $ 572 $ 1,020 $ 572 $ 1,020 |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Three Months Ended Six Months Ended 2019 2020 2019 2020 Cost per Served Sale $ 33,549 $ 20,353 $ 54,558 $ 51,199 Cost per Redemption 14,276 7,339 28,240 21,407 Other 905 530 1,920 1,125 Revenue $ 48,730 $ 28,222 $ 84,718 $ 73,731 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Lease, Cost [Table Text Block] | ctivity related to our leases (in thousands): Three Months Ended Six Months Ended Operating lease expense $ 886 $ 1,913 Variable lease expense 175 472 Short-term lease expense 45 157 The following table presents our weighted average borrowing rate and weighted average lease term: June 30, 2020 Weighted average borrowing rate 3.4 % Weighted average remaining lease term (years) 3.81 |
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | s of June 30, 2020 (in thousands): Amount 2020 (remainder of year) $ 2,098 2021 3,969 2022 3,932 2023 2,348 2024 1,807 Thereafter 611 Total lease payments 14,765 Imputed interest 939 Total operating lease liabilities $ 13,826 |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | as of December 31, 2019 prior to our adoption of ASU 2016-02 (in thousands): Minimum Lease Payments 2020 $ 3,040 2021 2,759 2022 2,808 2023 1,847 2024 1,807 Thereafter 611 Total $ 12,872 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Allocation of recognized period costs | The following table summarizes the allocation of stock-based compensation in the consolidated statements of operations (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Delivery costs $ 199 $ 357 $ 363 $ 532 Sales and marketing expense 952 2,567 1,659 3,836 Research and development expense 363 1,401 566 2,004 General and administration expense 1,558 4,783 2,192 6,861 Total stock-based compensation expense $ 3,072 $ 9,108 $ 4,780 $ 13,233 |
Summary of common stock option activity | Options to purchase shares of common stock generally vest over four years and expire 10 years following the date of grant. The following table summarizes changes in common stock options: Shares (in thousands) Weighted-Average Exercise Price Weighted Average Contractual Life (in years) Aggregate Intrinsic Value (1) Options outstanding — December 31, 2019 1,000 $ 22.99 Granted — — Exercised (275 ) 19.71 $ 14,956 Forfeited (9 ) 28.71 Canceled (1 ) 28.96 Options outstanding — June 30, 2020 715 24.17 6.12 $ 32,752 Exercisable — June 30, 2020 607 $ 23.87 5.99 $ 27,983 |
Summary of RSU activity | We grant restricted stock units ("RSUs") to employees and our non-employee directors. The following table summarizes changes in RSUs, inclusive of performance-based RSUs: Shares (in thousands) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term (in years) Unamortized Compensation Costs Unvested — December 31, 2019 1,741 $ 18.55 Granted 1,544 38.29 Vested (416 ) 18.88 Forfeited (242 ) 22.16 Unvested — June 30, 2020 2,627 $ 29.76 3.42 $ 64,036 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Deferred FI implementation costs | The following table summarizes changes in deferred FI implementation costs (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Beginning balance $ 14,067 $ 7,375 $ 15,877 $ 8,383 Recoveries through FI Share (1,155 ) — (2,312 ) — Amortization (731 ) (991 ) (1,384 ) (1,999 ) Ending balance $ 12,181 $ 6,384 $ 12,181 $ 6,384 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of antidilutive securities | June 30, 2019 2020 Common stock options 1,620 715 Common stock warrants 868 — Unvested restricted stock units 1,846 2,627 Common stock issuable pursuant to the ESPP 22 9 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | The following table presents a reconciliation of loss before income taxes presented in accordance with GAAP to adjusted contribution (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Adjusted contribution $ 21,841 $ 12,402 $ 39,478 $ 32,781 Minus: Amortization of deferred FI implementation costs (1) 731 991 1,384 1,999 Delivery costs 3,370 3,499 6,616 6,905 Sales and marketing expense 11,047 10,405 20,384 21,373 Research and development expense 2,782 3,966 5,723 7,817 General and administration expense 8,340 11,734 15,340 22,478 Depreciation and amortization expense 1,053 1,545 2,014 3,876 Total other expense 1,028 20 841 1,622 Loss before income taxes $ (6,510 ) $ (19,758 ) $ (12,824 ) $ (33,289 ) (1) Amortization of deferred FI implementation costs is excluded from adjusted FI Share and other third-party costs, which is shown above in our reconciliation of GAAP revenue to adjusted contribution. The following table provides information regarding our Cardlytics Direct reportable segment (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Adjusted contribution $ 21,841 $ 12,402 $ 39,478 $ 32,781 Plus: Adjusted FI Share and other third-party costs (1) 26,889 15,820 45,240 40,950 Revenue $ 48,730 $ 28,222 $ 84,718 $ 73,731 (1) Adjusted FI Share and other third-party costs presented above represents GAAP FI Share and other third-party data costs less amortization of deferred FI implementation costs, which is detailed below in our reconciliation of GAAP loss before income taxes to adjusted contribution. |
Schedule of revenue by geographic areas | The following tables provide geographical information (in thousands): Three Months Ended Six Months Ended 2019 2020 2019 2020 Revenue: United States $ 43,123 $ 26,750 $ 74,471 $ 66,778 United Kingdom 5,607 1,472 10,247 6,953 Total $ 48,730 $ 28,222 $ 84,718 $ 73,731 December 31, 2019 June 30, 2020 Property and equipment, net: United States $ 12,052 $ 10,465 United Kingdom 2,010 2,338 India 228 180 Total $ 14,290 $ 12,983 |
OVERVIEW OF BUSINESS AND BASI_4
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Amortization of Intangible Assets | $ 800 | ||||
Restructuring Charges | $ 400 | $ 900 | |||
Increase (Decrease) in Contract with Customer, Liability | 1,200 | ||||
Bad debt expense (reversal) | $ 151 | $ 402 | $ 1,326 | $ 652 |
OVERVIEW OF BUSINESS AND BASI_5
OVERVIEW OF BUSINESS AND BASIS OF PRESENTATION Changes in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Beginning balance | $ 1,383 | $ 397 | $ 255 | $ 169 |
Bad debt expense (reversal) | (151) | (402) | (1,326) | (652) |
Write-offs, net of recoveries | (212) | (227) | (561) | (249) |
Ending balance | $ 1,020 | $ 572 | $ 1,020 | $ 572 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING STANDARDS - Consumer Incentives (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Accounting Policies [Abstract] | ||||
Consumer Incentives, Expense | $ 11.3 | $ 25 | $ 33.6 | $ 47.6 |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING STANDARDS - Concentrations of Risk (Details) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Minimum | ||
Concentration Risk [Line Items] | ||
Financial institutions agreement, term | 3 years | |
Maximum | ||
Concentration Risk [Line Items] | ||
Financial institutions agreement, term | 7 years | |
One Customer | Customer Concentration Risk | Accounts Receivable | ||
Concentration Risk [Line Items] | ||
Concentration risk | 12.00% | |
Two Customer [Member] [Member] | Customer Concentration Risk | Accounts Receivable | ||
Concentration Risk [Line Items] | ||
Concentration risk | 17.00% | |
Chase | Supplier Concentration Risk | Financial Institution Partner | ||
Concentration Risk [Line Items] | ||
Concentration risk | 75.00% |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING STANDARDS - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Accounting Policies [Abstract] | |||
Cash and cash equivalents | $ 98,370 | $ 104,458 | $ 32,495 |
Restricted cash | $ 105 | $ 10,254 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING STANDARDS - Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 28,222 | $ 48,730 | $ 73,731 | $ 84,718 |
Cost per Served Sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 20,353 | 33,549 | 51,199 | 54,558 |
Cost per Redemption [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,339 | 14,276 | 21,407 | 28,240 |
Cost Other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 530 | $ 905 | $ 1,125 | $ 1,920 |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Consumer Incentives, Expense | $ 11,300 | $ 25,000 | $ 33,600 | $ 47,600 |
Revenue from Contract with Customer, Excluding Assessed Tax | 28,222 | 48,730 | 73,731 | 84,718 |
Cost per Served Sales [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 20,353 | 33,549 | 51,199 | 54,558 |
Cost per Redemption [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,339 | 14,276 | 21,407 | 28,240 |
Cost Other [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 530 | $ 905 | $ 1,125 | $ 1,920 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use asset | $ 10,422 | $ 0 | |
Total operating lease liabilities | 13,826 | ||
Operating Lease, Modification | $ 2,100 | ||
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use asset | $ 10,300 | ||
Total operating lease liabilities | 13,500 | ||
Deferred rent liabilities | $ 3,200 |
LEASES - Lease Information (Det
LEASES - Lease Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020USD ($) | Jun. 30, 2020USD ($) | |
Leases [Abstract] | ||
Operating lease expense | $ 886 | $ 1,913 |
Variable lease expense | 175 | 472 |
Short-term lease expense | $ 45 | $ 157 |
Weighted average borrowing rate | 3.40% | 3.40% |
Weighted average remaining lease term (years) | 3 years 9 months 21 days |
LEASES - Maturity of Lease Liab
LEASES - Maturity of Lease Liabilities (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
2020 (remainder of year) | $ 2,098 |
2021 | 3,969 |
2022 | 3,932 |
2023 | 2,348 |
2024 | 1,807 |
Thereafter | 611 |
Total lease payments | 14,765 |
Imputed interest | 939 |
Total operating lease liabilities | $ 13,826 |
LEASES - Future Payments for Op
LEASES - Future Payments for Operating Leases (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 3,040 |
2021 | 2,759 |
2022 | 2,808 |
2023 | 1,847 |
2024 | 1,807 |
Thereafter | 611 |
Total | $ 12,872 |
DEBT - Schedule of Debt (Detail
DEBT - Schedule of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Less current portion of long-term debt | $ (24) | $ (24) |
Long-term debt, net of current portion | $ 0 | $ 13 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | May 14, 2019 | |
Debt Instrument [Line Items] | |||
Debt Instrument, Unused Borrowing Capacity, Amount | $ 26,400,000 | ||
Cash paid for interest | $ 32,000 | $ 771,000 | |
Maximum borrowing capacity, percentage of accounts receivable | 85.00% | ||
Principal payments of debt | $ 11,000 | $ 10,010,000 | |
Lines of credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 40,000,000 | ||
Debt instrument, interest rate | 2.75% | ||
Commitment fee percentage | 0.15% | ||
Lines of credit | Loan Facility, Threshold Two [Member] | Prime Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Term loans | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate | 2.00% | ||
Term loans | Prime Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 2.75% | ||
Revolving Credit Facility | Lines of credit | |||
Debt Instrument [Line Items] | |||
Line of Credit, Current | $ 40,000,000 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) $ in Millions | Jul. 29, 2020USD ($)shares | Feb. 08, 2018shares | Jun. 30, 2020USD ($)usershares | Jun. 30, 2019USD ($) | Jan. 01, 2020shares | Dec. 31, 2019shares | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Lease Obligation Incurred | $ | $ 0.2 | $ 0.1 | |||||
Number of shares authorized (in shares) | 1,875,000 | 1,345,631 | |||||
Number of shares remaining available for issuance (in shares) | 61,247 | ||||||
Award vesting period | 4 years | ||||||
Expiration period | 10 years | ||||||
Options vested in period, fair value | $ | $ 1.4 | ||||||
Compensation not yet recognized | $ | $ 1.3 | ||||||
Common stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation cost not yet recognized | 8 months 12 days | ||||||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 4 years | ||||||
Granted (in shares) | 1,544,000 | ||||||
Unvested PSU (in shares) | 2,627,000 | 1,741,000 | |||||
Compensation cost not yet recognized | 3 years 5 months 1 day | ||||||
Restricted stock units | Share-based Compensation Award, Tranche One | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | 1,057,978 | ||||||
Performance Shares [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unvested PSU (in shares) | 1,252,500 | ||||||
Performance Shares [Member] | Share-based Compensation Award, Tranche One | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
RSU, performance condition, period | 3 years | ||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Non-Option Equity Instruments, Performance Conditions | user | 0.50 | ||||||
Performance Shares [Member] | Share-based Compensation Award, Tranche Two | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
RSU, performance condition, period | 5 years | ||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Non-Option Equity Instruments, Performance Conditions | user | 0.25 | ||||||
Performance Shares [Member] | Share-based Payment Arrangement, Tranche Three [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Non-Option Equity Instruments, Performance Conditions | user | 0.25 | ||||||
ESPP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized, annual increase | 1.00% | ||||||
ESPP, purchase price percentage | 85.00% | ||||||
ESPP, number of shares authorized, annual increase (in shares) | 500,000 | 265,470,000 | 267,823,000 | ||||
Employees and non-employee directors | Minimum | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 1 year | ||||||
Employees and non-employee directors | Maximum | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 4 years | ||||||
Subsequent Event | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | 91,593 | ||||||
Compensation not yet recognized, awards other than options | $ | $ 6.1 |
STOCK-BASED COMPENSATION - Allo
STOCK-BASED COMPENSATION - Allocation of Stock-based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Jan. 01, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Feb. 08, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Monthly Average Closing Price, Common Stock, Threshold | $ 69.98 | |||||||
Number of shares authorized (in shares) | 1,345,631 | 1,875,000 | ||||||
Total stock-based compensation expense | $ 9,108 | $ 3,072 | $ 13,233 | $ 4,780 | ||||
Delivery costs | ||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
Total stock-based compensation expense | 357 | 199 | 532 | 363 | ||||
Sales and marketing expense | ||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
Total stock-based compensation expense | 2,567 | 952 | 3,836 | 1,659 | ||||
Research and development expense | ||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
Total stock-based compensation expense | 1,401 | 363 | 2,004 | 566 | ||||
General and administration expense | ||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
Total stock-based compensation expense | $ 4,783 | $ 1,558 | $ 6,861 | $ 2,192 | ||||
ESPP | ||||||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||
ESPP, number of shares authorized, annual increase (in shares) | 500,000 | 500,000 | 265,470,000 | 267,823,000 | ||||
Number of shares authorized, annual increase | 1.00% |
STOCK-BASED COMPENSATION - Summ
STOCK-BASED COMPENSATION - Summary of Common Stock Option Activity (Details) $ / shares in Units, $ in Thousands | Jan. 01, 2019shares | Jun. 30, 2020USD ($)$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ | $ 32,752 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Number | 607,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 23.87 | |
Award vesting period | 4 years | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 1,327,352 | |
Shares (in thousands) | ||
Beginning balance (in shares) | 1,000,000 | |
Granted (in shares) | 0 | |
Exercised (in shares) | (275,000) | |
Forfeited (in shares) | (9,000) | |
Canceled (in shares) | (1,000) | |
Ending balance (in shares) | 715,000 | |
Weighted-Average Exercise Price | ||
Beginning balance (in usd per share) | $ / shares | $ 22.99 | |
Granted (in usd per share) | $ / shares | 0 | |
Exercised (in usd per share) | $ / shares | 19.71 | |
Forfeited (in usd per share) | $ / shares | 28.71 | |
Canceled (in usd per share) | $ / shares | 28.96 | |
Ending balance (in usd per share) | $ / shares | $ 24.17 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | $ | $ 27,983 | |
Common stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 6 years 1 month 13 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 5 years 11 months 26 days |
STOCK-BASED COMPENSATION - Su_2
STOCK-BASED COMPENSATION - Summary of RSU Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 29, 2020 | Jun. 30, 2020 |
Weighted-Average Grant Date Fair Value | ||
Award vesting period | 4 years | |
Restricted securities units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock option expense | $ 64,036 | |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost not yet recognized | 3 years 5 months 1 day | |
Shares (in thousands) | ||
Unvested — Beginning balance (in shares) | 1,741,000 | |
Granted (in shares) | 1,544,000 | |
Vested (in shares) | (416,000) | |
Forfeited (in shares) | (242,000) | |
Unvested — Ending balance (in shares) | 2,627,000 | |
Weighted-Average Grant Date Fair Value | ||
Unvested — Beginning balance (in usd per share) | $ 18.55 | |
Granted (in usd per share) | 38.29 | |
Vested (in usd per share) | 18.88 | |
Forfeited (in usd per share) | 22.16 | |
Unvested — Ending balance (in usd per share) | $ 29.76 | |
Award vesting period | 4 years | |
Performance Shares [Member] | ||
Shares (in thousands) | ||
Unvested — Ending balance (in shares) | 1,252,500 | |
Subsequent Event | Restricted stock units | ||
Shares (in thousands) | ||
Granted (in shares) | 91,593 | |
Weighted-Average Grant Date Fair Value | ||
Compensation not yet recognized, awards other than options | $ 6,100 | |
Maximum | Employees and non-employee directors | Restricted stock units | ||
Weighted-Average Grant Date Fair Value | ||
Award vesting period | 4 years |
RELATED PARTIES - Narrative (De
RELATED PARTIES - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 6 Months Ended |
Feb. 28, 2018 | Jun. 30, 2020 | |
Related Party Transaction [Line Items] | ||
Proceeds from Warrant Exercises | $ 15.2 | |
Class of Warrant or Right, Exercised | 644,365 | |
Common Stock Warrants | ||
Related Party Transaction [Line Items] | ||
Stock option expense | $ 2.5 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions | Jun. 30, 2020USD ($) |
Financial Institution Share Commitment | |
Loss Contingencies [Line Items] | |
FI share commitment | $ 10 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Deferred FI Implementation Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Deferred Financial Institution Costs [Roll Forward] | ||||
Beginning balance | $ 7,375 | $ 14,067 | $ 8,383 | $ 15,877 |
Recoveries through FI Share | 0 | (1,155) | 0 | (2,312) |
Amortization | 991 | 731 | 1,999 | 1,384 |
Ending balance | $ 6,384 | $ 12,181 | $ 6,384 | $ 12,181 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares shares in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Common stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 715 | 1,620 |
Common stock warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 868 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 2,627 | 1,846 |
Common stock issuable pursuant to the ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 9 | 22 |
SEGMENTS - Narrative (Details)
SEGMENTS - Narrative (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020USD ($)segment | Jun. 30, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 2 | |
Capital expenditures | $ 1,225 | $ 4,019 |
United Kingdom | ||
Segment Reporting Information [Line Items] | ||
Capital expenditures | $ 400 | $ 300 |
SEGMENTS - Revenue by Segment (
SEGMENTS - Revenue by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||
Adjusted contribution | $ 12,402 | $ 21,841 | $ 32,781 | $ 39,478 |
Revenues | 28,222 | 48,730 | 73,731 | 84,718 |
Cardlytics Direct | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted contribution | 12,402 | 21,841 | 32,781 | 39,478 |
Plus: FI Share and other third-party costs | 15,820 | 26,889 | 40,950 | 45,240 |
Revenues | $ 28,222 | $ 48,730 | $ 73,731 | $ 84,718 |
SEGMENTS - Adjusted Contributio
SEGMENTS - Adjusted Contribution Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting [Abstract] | ||||
Adjusted contribution | $ 12,402 | $ 21,841 | $ 32,781 | $ 39,478 |
Amortization of deferred FI implementation costs | 991 | 731 | 1,999 | 1,384 |
Delivery costs | 3,499 | 3,370 | 6,905 | 6,616 |
Sales and marketing expense | 10,405 | 11,047 | 21,373 | 20,384 |
Research and development expense | 3,966 | 2,782 | 7,817 | 5,723 |
General and administration expense | 11,734 | 8,340 | 22,478 | 15,340 |
Depreciation and amortization expense | 1,545 | 1,053 | 3,876 | 2,014 |
Total other expense | 20 | 1,028 | 1,622 | 841 |
Loss before income taxes | $ (19,758) | $ (6,510) | $ (33,289) | $ (12,824) |
SEGMENTS - Geographical Informa
SEGMENTS - Geographical Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Revenues | $ 28,222 | $ 48,730 | $ 73,731 | $ 84,718 | |
Property and equipment | 12,983 | 12,983 | $ 14,290 | ||
United States | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 26,750 | 43,123 | 66,778 | 74,471 | |
Property and equipment | 10,465 | 10,465 | 12,052 | ||
United Kingdom | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 1,472 | $ 5,607 | 6,953 | $ 10,247 | |
Property and equipment | 2,338 | 2,338 | 2,010 | ||
INDIA [Domain] | |||||
Segment Reporting Information [Line Items] | |||||
Property and equipment | $ 180 | $ 180 | $ 228 |
SEGMENTS Concentration of Risk
SEGMENTS Concentration of Risk (Details) - Accounts Receivable - Customer Concentration Risk | 6 Months Ended |
Jun. 30, 2020 | |
One Customer | |
Revenue, Major Customer [Line Items] | |
Concentration risk | 12.00% |
Two Customer [Member] [Member] | |
Revenue, Major Customer [Line Items] | |
Concentration risk | 17.00% |
COMMON STOCK WARRANTS (Details)
COMMON STOCK WARRANTS (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Exercised | (644,365) | |
Common stock warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Outstanding | 0 | 12,000 |
Warrants and Rights Outstanding | $ 0 | $ 23.64 |
Class of Warrant or Right, Exercised | (9,000) | |
Class or Warrant or Right, Exercise Price of Warrant or Right, Exercised | $ 23.64 | |
Class or Warrant or Right, Forfeited And Canceled | (3,000) | |
Class or Warrant or Right, Exercise Price of Warrant or Right, Forfeited and Canceled | $ 23.64 |
Uncategorized Items - cdlxform1
Label | Element | Value |
Stock Issued During Period, Value, Employee Stock Purchase Plan | us-gaap_StockIssuedDuringPeriodValueEmployeeStockPurchasePlan | $ 1,312,000 |
Common Stock [Member] | ||
Stock Issued During Period, Value, Employee Stock Purchase Plan | us-gaap_StockIssuedDuringPeriodValueEmployeeStockPurchasePlan | 28,000 |
Additional Paid-in Capital [Member] | ||
Stock Issued During Period, Value, Employee Stock Purchase Plan | us-gaap_StockIssuedDuringPeriodValueEmployeeStockPurchasePlan | $ 1,312,000 |