LLNW - Earnings call transcript Q1 2021

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Operator

Good afternoon, and welcome to the Limelight Networks First Quarter 2021 Financial Results Conference Call. [Operator Instructions]. I would now like to turn the conference over to Dan Boncel, Chief Financial Officer. Please go ahead.

Daniel Boncel

Good afternoon. Limelight First joining Conference Financial for Call. you Networks' Quarter XXXX Results Thank being XX, days. today, be call recorded This is April our for archived website XXXX, approximately XX on will and

safe Let by remind that this will me we on would making statements quickly the everyone forward-looking start be call. like harbor. covering to We

Actual such business are our functionalities. expectations, priorities, be all not could strategies, of Forward-looking and indication our trends results that statements product strictly future statements should as considered from by operational plans, materially as are statements of secular and performance. an and not historical those fact, forward-looking our differ our reported feature contemplated results statements

recent please risk to XX-K. to forward-looking the Form and statements, except information, this our The to factors forward-looking more required any statements periodic law. of any are as refer we available report our information annual disclaim based on obligation by on on in For date, most today's call us discussed filings, as including update

on then detail. me X Chief Bob today's Lyons, start will accomplishments today the results financial growth. detailing is and recent Bob Officer. for I'll pillars pursuit call of Executive strategic in our our review in President call Joining

Following discuss forward. the will the call that, Bob our remainder of use to plan going

Q&A. then now will to call turn for open Bob. I'll We the the call over

Robert Lyons

profitability; in commitment our quarter's our focuses value. balance diversify recent let outlined more days the and color Having are: longer-term client we third, which core, improving my improving core strategy bit revenue me shareholder and on and focuses our I In foundation call, our transparency traffic dig each more and improve and expanding supported and X to land It on momentum customers on pursuing into is loss and objectives. Thank detail, growth our last which additional you, to by expand on everyone. which a They immediate also performance had and quarters. focused Dan, our our shared improve XX solutions to to X first, utilization. accountability. second, our our our and non-peak network welcome, profitability commercial of of core, of share motions; extending pillars,

has discussed, previously contributor. significant compression price been a As

reductions Additionally, to traffic we have seen our SLA performance. related some in client

plan It Our to is return our our our heritage best-in-class our people to is take clients. lost our that delivering in, pride to something company deep we performance simply focus. but of

our XX have again and heritage. performance the days, committed best-in-class we refocused gotten are to resourced fully Over support past and

rigorous our who engineers, of performance team, and spans disciplined a have engineering performance across client established aspects are the an key have tuning performance purpose indicators. with a chartered that of implemented process all our ongoing advanced sole of our improvement our most operations. collection and specifically, We client-defined network and More and we talented

have We management. operational our of also training change refreshed and the discipline

and a We teams have practices with review And daily operate standup tools of weekly and understanding. strengthened a to wardroom deeper processes with us meeting each last, client enabling with improved engage and processes, our these much a success process. client

difference seen have of by results: following rebuffer to rate a industry top competes experienced metric have in a improved fractions on we our the percentage XX%. Our improvements, performance We With typically client initial performance. up

for first Dan achieve expect moving no have share in how traffic XX%, importantly, by progress Dan? we of financials, increase XX% we seen us Still, call quarter in work and there more to remains guidance the network the increase an the These are that direction. to customers. to of will an At large and, Our to of to do. this most doubt in I Latin the turn global early right has indications guidance. from remainder several traffic our by time, up report increased throughput year, over America

Daniel Boncel

Bob. Thanks,

CEO, decided off February, as our Bob's into in tenure X earnings was hold call than issuing to less guidance weeks we Given for XXXX.

have million believe million; $XX in with we our with $X.XX this GAAP our non-GAAP to the in share and marketplace, existing and customers performance $X.XX; another to currently with realize used to and in believe only growth. $XXX of to a the in clients, need $X.XX; cost We of adjusted of are second client credibility share, revenue structure. to EBITDA, we potential quarter to shareholders. million will to We in market half the into line reestablish loss, evaluate positive to enhancements expenditures, critically take our and metrics are million. have will be positive that the million significantly manifest At and our our on putting but expected range initiatives XXXX. we the in range impact time, our $XX place per We range $X.XX $XXX our additional performance with capital our performance These the but improved million; result customers top and the time transparency up significant in $XX will $XX loss between success operating of not

the month, workforce our the transformation by many Limelight. necessary step reduced XX%, see approximately our we while of to colleagues and last leave, it of to friends Additionally, difficult was begin

operating position. are of the improvements important is drive as to soon This annualized SG&A the as savings. will to $XX expect we demonstrates firmly expense quarter. savings items on line from action immediate million, rate and action This this bottom approximately expected primarily line the the our focused committed run as and second in financial We improving

incremental show Bob. by implement We expect to out we to the laid gains as strategy continue

The $XX.X continues impact of from a impact the a mentioned first results. was quarter have we flow-through first of the price first Revenue for an decline quarter on compression on XXXX. million, of year-over-year our to that with last of customers to quarter XX% quarter adverse largest results. Now number

a has our impact customers, performance. compression of the our price on a with number significant concentration financial small Given revenue base of

adapt will align allow are They about. clients' expectations. to closely enable will customers also success This model with monitoring our performance operating to more of against us changes compression, improvements performance, in growth the quickly more performance second tracking price new our we year. revenue Our margin the care our and half identify our better expect to team the the ecosystem. growth volume expansion client to most With driving and to within exceed the and metrics gross

margins compared dollar-denominated up for XX% from ago. quarter the a top clients approximately for first of in revenue. Approximately XX% XX% in quarter XX.X% year non-U.S. was gross International to XX% XX% from year. last to accounted quarter first year. of accounted Our currencies, total XX total first last XX% of QX in revenue our clients declined of revenue Cash

gross the margin. our declined to Given mostly drove in price primarily fixed revenue cost reduction the due infrastructure, compression, cash

gross gigabyte is our we day, customer utilization. cost utilization capacity structure. for These we base, decreased that have services. demand Most improve quarter margin with and a off-peak the largest Our the traffic, to opportunity believe for delivered first cost gross of year approximately believe profiles poor in we By focus requiring streaming to period OTT clients significant video of improve compared asset trend, diversifying margin. peak this short the offer there network first leading this XX% of can clients us only significantly per more year. on we traffic similar Continuing last our as quarter to asset our improve

in points is utilization $X and XXX utilization region network current gross profit can improvement and of $X depending high improve million the teens. on basis average selling Every million, price. between the Our

and cost and million to earlier detailed the in country into of allocated region. $X.X have $X totaling cash will million, is This We built visibility million optimization of been cost drive in down restructuring by $X.X $XX.X X% million structure develop of and expenses action line million disciplined employee would items: have approximately million be in and for and the severance locality, $XX.X $X in anomalies of us more and in model to Total and Total plans $X.X $XX.X and also sales and monitoring operating marketing, excluding manner related expenses include that dive million, The million, a out will a allow to million, a revenue, transition-related and identify equity year-over-year. annualized operating pop restructuring modification. $X.X G&A, level $X.X expenses. $XX recorded to in costs. costs transition-related consulting $XX.X were following noncash million administrative R&D. savings expenses cost Of in million award I million and to general costs decrease

days we We will I million. to $XXX call and continue million our at million DSO turn was end the to cash $X.X of the remainder Capital million performance, Cash were gross the of our be XX the With that, expenditures end Net XXXX improve range margins totaled EBITDA balance We million. the was to and quarter million adjusted to equivalents cash costs the the $XX.X as within external and $X.X compared sheet. loss DSO XX of and continued in $X.X process normal performance expect flow improvements, profitability. work XX restructuring in XX a anticipate days during to approximately loss of to at decreased the quarter optimized and December. days. over in transition-related Bob. On overall of with quarter. consultants, for year of evaluating reduce $X charges the

Robert Lyons

Thanks, Dan.

believer in because I I'm asymmetric joined the investing why joined Limelight company in risk. Simply reiterate me February. Let put, big I a in

is long limit. challenges and the temporary, Here, opportunity without but the are

We Within relentless be years, pursuit with become accretion Limelight will the to X XX of be value. shareholder we be. company in to company want we rule of our aspire to all a material

and expense are progress, Alex our creation. We strong to and directly extended Limelight the aligned be management. indexed the ongoing we with at in value have have shareholder performance, operational their They support with of relationship our have belief a opportunity progress structure discipline To partners. making with fee pace recent

bit Now our of core continue efforts improve and cost a The me to on more focus our pillars in will let detail. the each performance structure. unpack to X

pop-by-pop aforementioned solutions significant our begun and opportunity extending steps our new continues align the identified a actions on be have pops our share to expand of and use addition efficiency, underutilized On our driving number new a and extend hardware the clients. to opportunity performance. the traffic market we sales believe a clients solid help initiatives utilization, with to have of gross improve we action identify taken, pillar. and will we with to our infrastructure to an reductions. evaluating of solutions. improvements pursuit continue network us This capacity improve current improved profitability opportunities basis. in our and/or we premise by peering specific operating additional to We that and there is foundation believe utilize cost performance nonpeak to growth we This cost drive capacity In margin have of of In have also

are for centralization They creating to experiences clients it augment their to load protect builders scale the seeking outside network. and it low digital security-enabled on processing real-time are focused benefits latency, better faster, customers, Our control need and digital content cloud of and with and the offers a edge personalize their environment. more the

to differentiated goal in clients. powerful is edge of Our put hands our an capabilities as organization the

have the our right path the am our support work planning objectives. I assessment pillar we profitability and We confident to in this achieve and of on strategy. required that revenue begun of are

our Please the forward unique details will Our look summer of please go-forward up advance release. in welcome. a and latency, early I question-and-answer our join jewel, and An participation actions the so, session. headwinds for and strategy our shared the and questions global market we will the network overcoming operational of do With via the announcement crown operator, these large result opportunity. X strategy position more that, low unmet will for date To our open and discussion to strategy approximately have update. growing short-term to will to-be-scheduled press the lines be ultra on where address and elements expertise. highlighted in I sharing leverage feedback event us month in details be optimize

Operator

[Operator Instructions].

The first Miller Greg question from with Truist Securities. comes

Gregory Miller

really would wanted talk more do late the year appreciate I a had to bit planning that time to for a have about the the a in guessed seen outlook but personal year. yourself year. swing But little and stake this last we the before little ground, you just business that such the have would given I we

behind very performance unless CDN much You guess a see to price. relating a given you've give today, we'd might in additional largely look scenes last to the like revenue with sort different something in X trajectory. change it what alluding colors been trajectory don't or see the confidence? customer fixed downdraft. that sort for 'XX a large quarters of the of the business, the that any typically in might whatever I have of you're 'XX, was established lot do cost happening letdown guide the But issue. of Can you that wrong you seems that to have us gives

Robert Lyons

Yes. how color we great more closely I'll question. Thanks are because the Bob. the with question. It's is, two then to question. giving into we Greg, unpack I'm One are today. it's guidance think And parts to go where tied two for feel I a going together. two, your comfortable

as As guidance, look factors as roll the micro well far try and them how at as we factors to macro up. we

a world as was some macro in of a to is People that starting this the little bit think, as trends lot revert And it's year, the a to lockdown. back have so normal. watching when what of far industry, you we're back and last were we look in at time to whole reversion mean TV, I the seeing

a a little us. of short-term that's headwind for bit So

I expand industry though, rapid to and a other of pretty the grow. is to on continues pace continues think coin, that side at the

So other we as neutral see than maybe timing issues. those some somewhat

your look the that talked we the reason both reason But the going in never easy. few clients. obviously, how If clients traffic a compared for to which the share. it's you traffic in first performance. factors, compression, why based we much the there to you're that's they are doing second the and challenged second And for get get when place when from really it's here about always the that, us also We on our has give to lion's what -- other what or get SLA is at to that away. people -- addition And you business, get price lion's decide much our when have we been or our quarters first in few metrics And to pretty than matter stay, you we you're the impacted place. is less you're of feel micro historically, and fourth and largely share. And place, third, in place, in last optimistic upcoming quarters you

largely, year, we combination getting it's past competitors And we ball. little focus our of frankly, the quite we a our though, lost a eye few slipped. and but Over just off a the better, took

And think is by based on we're And get client where in so, the we forecast, over we at we bottoms-up went where past built by the looked XX going on client, we that. based forecast improvements to -- to it the in today, days, that's forecast. where with performance, and

I a Greg, forecast. honestly, make in an risk quite make why I so argument a strong there's argument why And forecast. could conservative it's also the could

a that There of think having very we so on the have to things person is it issues, of things. color X.X% out -- middle like us put And fairway really right it's look the position those put There's divvy difference we playback things right a but do are And the is the we in the that, like at X%, say, metrics simple. what to And kind clients what failures. volume. rebuffering on try could slipped is "This some So now." performance between we and very down right of they or rate, to of said fraction it's traffic. few meaningful the and and next application be how

we've gotten gotten back a really number and on I X, upticks out in we've will performance over the over we is last pretty we about issues jail had of And back why into in dialed seen pretty We're really days. frankly, feel in quickly year. And the the to tell of the of the and last improvements, in one traffic we past some that meaningful XX we translated had we many to talked to that. down. #X new though, past in that pursuing so XX optimistic things XX that dig in of days, in put in others XX QX, the basics, X lot we and days, felt the and performance. traffic us positions clients felt and seeing the in And continue that it's And some QX, to opening. quite turn you What reasons we

fact, just were morning had In previously to of press, dial us top customers that tell the off we going on the X our today X days. us up based over they this improvements back last XX the

very think promise. In "Limelight going presentation XX to fact, you time." And busy very that past But in past I'll don't taken the and weeks the the few as share that quotes out of days from show by over way, That's customers a appropriate. both the that from efforts been have that have names, best marquee of the couple their who we guys quality about the today long Limelight we not customer be seen would are were: So came breakdown reliability are us and pretty this jail, and the that. morning. I the the meeting. X from has seriously. some of of over quotes I'm had performance and of and of a Clearly, in the literally our we're taking meeting and content we've share excited

the few had we doubt it. we're bumps So progress now. feel past that the We some over about good quarters, we no making but about pretty

Operator

next Sachs. The Goldman from is with question Brett Feldman

Brett Feldman

some customers of of leaves made the largest you are point capacity. a excess You that off-peak with OTT significant But the amount in how your about space.

of sort have I So two there. questions

that a impact a tailwind imagine on traffic standpoint, expanding I just at a traffic probably OTT but a that have for because of standpoint, actually would from from I'd a constructive services, would Not your that, has diversification guessed your intuitively bit business. of when I the The number first guess, have I is, been pricing. more look

I played maybe Or So potential to traffic? would after maybe what importantly, significant you being What be you you think you some customer to to additional able and the opportunities? insight give hoping hires more when sources hasn't to you of principal And well right as investments there capacity amount as second yet. are then at that out how about are times, to why need was the that? of to off-peak us targeted now and go positioned can the make talk benefit your sets haven't or historically of those maybe excess pursue are you

Robert Lyons

Brett. question. Thanks, yes. Great Yes,

start necessarily the really reason The more beginning. of So at what because if the to. doing utilization a it's our why curve. I'll the -- at have same time, regardless OTT they doesn't people And TV watch you source is improve customers demand who of lot about go

really XX% makes demand in the you And capacity, doing And majority is money. fact, curve. get latent of your have you mathematically, window, -- the of and utilization And look really really in peak OTT if is of you of demand can X-hour you're you sometimes the X- because costs to business, your that XX our a it all capacity at that hours math never and traffic. lot have so for issue build comes you the or if even network capacity, X-hour worse over more a creating a vast more if of

unique IP that. this one But In that bit #X, and our fixed is that we've to the And adds backbone, extra addition why back we'll or the cost have it's quick and pretty significant fact industry. always have there been #X a that advantages of money that, in why that's get doing be own also historically, of to and we private able, cost. to something it we the little

more more of more And traffic, if pattern, the create what capacity. that's you is happens kind demand and latent same peak put so you

revenue, question for, city So unparalleled. every pay really IP ultra when in let's XX It's the backbone given we about diversifying of we have, high-quality really across latency, we that major say, a talk the world. network day that becomes, low bandwidth and own hours

that used. to would bring time, advantage can the if And with and that advantage, we so are that, and we're bandwidth, us go a same cost drives now, and gives utilization because cost paying And could for right solutions the becomes, our that that even business though can significantly of we being to those bandwidth we what significant question what not at look those leverage offer it's solutions and market like. leverage a performance out

we're more small our, types let's And that so side can summit. web talk that tell strategy scale, web you with that say, the -- that about fill involved logic acceleration, are But in the comment a at is getting web performance. we'll like looking things lot what mid-June at in I'll -- of things

their have able environment. for might cost-effectively they a we security day. Of play happens of big kind things our course, and thing. where data be that towards hybrid but lot security They applications. during as well, is a really that approached now Connect, And to where not and perimeter-oriented, network more real-time multi-cloud. haven't still They threat more log They enterprises seamlessly, is have the And detection just have Cross like there between locations. ideal you're of it a that efficiently traditional way. more Things And in are analytics data and ingestion, that premise around doing is moving to have enterprise. SaaS move

we that flows marketplace, improve, million region, to to bottom million $X the what do that And to leverage the We're are the can we're we'll pursue, having. the to can clear as depending those $X the conversations things through a tell be kind $X -- win utilization Dan you is million point all anywhere us definitely unique the and drive can where for that What the at every So million it comments, give I of in network that working our in will line. from about right those And in much of the right time. on same up and opening be that pointed out summer it's our we $X more things. all meeting. we early utilization

So meaningful us. for very a it's opportunity

Brett Feldman

Great.

that the do force mind, my I company a of question. career, And emerging reduction. ask out in takes to bump, a had and an don't culture. that uptick you an worked sure in comp done stock-based speed incentivized. growth I'd in quarter. looks Earlier have definitely the bite curious, who like here people are just and It different And they're I'm a a and in motivated on the they to hit staying was make what with If it you there excited

So like for equity may upside might you around? some Is a be that make have it get seems there incremental been quarters awards. to think turned few persisting as company sufficient something you sure the everyone has

Robert Lyons

great same and coming It's challenge. trying a Yes. an going have Brett. At we when trust drive time, say, the of to event And a you change." dilutes lot had, really don't which question, you're unfortunately, it's in we're like you're a to "Hey,

that Quite organization lot them to of strategy, we're through of doing. communications. giving number things the as the them we've a we're having taking on one, spent the X organization, a reasons with there's hours pushing pretty believe. I Number frankly, So probably today hard focused already been conversations well.

is And wins passionate to the them really company do the are just And about win Limelight people we be found What a so ago, do help it they while really people that. and little puts lot want of to in that just should need here that I we mentioned and that when sales. a what be it. got

pay-for-performance reward, of a a process We lot redesigning program. communication. in actually So are performance the of

really I behind exceptional for get that. employees standing we'll What up. tell them exceptional results performance, So have and those the people stepped

important So all we're part things. a doing those it's of really it. But

is of thing the we're other the do, telling what we're saying, bringing The employees that here's solutions. problem. into we them, Instead the doing need here's to

that. embrace and out energized about Let's and figure really together, it that they get

Operator

with James. The Majek next question is from Raymond Robert

Robert Majek

just appreciation your so And in by so quarterly, QX figure $XX in for tougher for help we number you on year a midpoint outdoors? head to rate one space the $XXX year the new in Or you my $XXX million, environment ramp don't doing pressure? to be perhaps million the to what cyclical traffic of but the just plus how get the that run the us have vaccinated assume annualizing get might million do can full just just million business gave. math, that guide in QX. in understand a of QX people revenue visibility potentially that some throughout and $XX have kind achieve from guidance could know of I'll you as CDN that, you of could net offset large business I guide

Robert Lyons

Yes. question. Great

Let me spent time I'll the that. and Dan But it. frame of up, put let then talking lot it details about a we on

wallet actually, point, to lockdown to opportunity on outside COVID. us, outside the so one But look well of with you as have at hand, in kind market, of clients. And the as going coming your people the now biggest our for summer the the share us from of material for is just

back, as you showed And over it we're XX the really that continue we it justified over making those. will But so we've not the I that those behind fan analysis of days of that's and actually yet. in we trajectories where you I'm tell put rarely the have very on. math each so to but hockey always days, if stick I making. I last looked you, the I'm as days, of one lot supports this reticent we've And a case, again, trend And isn't And would discounted out. plans. and the it's XX at improvements last a a actually see big long that, done particular them, XX

our if the on is us XX over in to it really told trends tried number. available top clients to is And that's that, based we with what we're really performance. to the know that we the try seeing So adjust recent opportunity what got have the to and we we us what they've we performance improvements we continue the to where improve and gauge then

Daniel Boncel

this bit Dan. Robert, add to more little Yes. that. And a is on just color

felt We to that, the first expect already and see gain where the do and and expect with little transparent guidance. the ramp more color to to starting that shareholders continue customers, expect quarter at from number appropriate through. be issue QX and to share given the and begin performance the in relatively -- to year guidance to it one, QX revenue normally, we don't was flow to back where in we with expect implement go full see give we've throughout sequentially And we we to We things improvements and then how year. grow be flat our trying that implemented QX from quarter-by-quarter that a our and But market going. we're and that

And But in to share first within the and a there's what aggressive, reason conservative, tried so we to that's said and approach and believe we've Bob like customers discounted can we it. believe that's his reason to the middle-road take to believe there's those in gain from market guidance. that comments, that, we opportunities

Robert Majek

were business? But also, performance that Or retain satisfied the with performance to a helpful. making you're thank you are specific customer have broader That's Yes. to is network. just And the their improvements where I now they are appreciate group they for feedback. there the guess And I performance sharing customer improvements back you large some to disappointed taking to with step today? if previously, more make

Robert Lyons

Yes.

we're seen biggest basically it's gets question. would actually I it's that's where some decides that just cases, a great we've nonperson traffic -- so based customer, in performance. return. traffic performance, who seeing with algorithm. the very a so mathematic uptick. the the And decision. a say, largest much encouraged the that's on It So our It's And

me. up wakes the day always perform if What the saying, every next that. going more same really answer though, to better? "How What do perform ask get So else what we XX the And can efficient? question we're a we're do you'll pretty do?" me that can quarter cost. from be can company the And tell we about I'll the we Robert, goes and to we be you to What better? excited for we're do every And is to do, that's more in. There's same industry for years, you -- that

Robert Majek

performance taking kind important maybe Could of profitability. EBITDA you help taking wouldn't understand how the actions appreciate the just the you're your it question, But you're last that And us why if Or Again, be improve how add you're I or performance again, raises given can, guess is. I'll I the especially think, negatively sales impact, one highlighting I motion? question. cost-cutting steps case. investors could either to

Robert Lyons

Yes. very thoughtful so. about think We don't that. We're

number I of think for a reasons.

On the things to I quarter. people operational, X cost we going There's Operationally, first cost we bit did. down. can side, the little areas. there's about really ways this that impact in strategic the the that and spoke architectural are drive are ones a

can we can we wanted new is function in technology less rip productivity, for efficient, at clients band it's that, looking that really shoulder. We predictable. people also over for metrics we do improve I'll Architecturally, our with done these where on. upgrade looking sell getting using like can translates use field, to off, tooling, less so example, we things for historically [indiscernible] TCP that more the we're a their Linux, significantly and things move we're operationally, more where that which for, a better. to into places to can, automation, to with aid people if the aren't also give second, So we we respond But

as utilization of really all up. at diversification off-peak all well. we're it's and level And using about granularity bandwidth strategically, that to It's utilization. about that then So drive

Operator

Eric from Lake Martinuzzi is Street. question next with The

Eric Martinuzzi

here the that, the increased green XX% a of Yes, is land In American from translate words, XX%. into it the like It shoots way that prior compression comparing we the Lat that other that if comment a Am -- prior there, takes to looks the puts up there price are business. in Is XX%? had guys to the happened quarter? already I traffic traffic. there? just highlighted words, looking kind by were I you in quarter, -- realize is a volume-based revenue for in Should Or other there revenue? and

Daniel Boncel

And out Dan. capacity our Yes. This some over with the or America. so, partners America, we've Appreciate Latin within question. capacity year a in ingrained X with T And Thanks, that we've well really Latin building Eric. the last is are the been ecosystem down added over there.

with down we it's is we're pretty U.S., There's soon of in up. performance Western the as them difficulty pops Europe, us which the for those nice is of the end countries good. premium really, well competition lot at actually that pricing year. the in there, where in a filling also lot have so a in on capacity of volume a play as the developed a saw really price last compression getting and And we as America putting play up there, Latin with us as for And down

to focused America and us, And it's so, is. continuing capacity been we're add Latin just profitable on where where it has for

Robert Lyons

color that Yes. for add and green shoots. to additional Eric, just I'd on

In I fact. matter conversation as green just shoots yesterday a and Dan fact, had a of

going And past, X has of solely X but said get you our on the upticks talked ago, is notable XX so, dwelled in we the XX improving of about, days, also, And to performance. one I'd our we XX just seen in to the in yes, really traffic performance. because were days top pieces in customers say, that improvements

get So as shoots today. as those from where we're about green can as are you good sitting

Eric Martinuzzi

all volume can these But flat we We Okay. mentioned, gross fixed given And -- bit on jaw there. was you talking QX, for not it about in revenue, QX, trend. for just I margin on we're for costs a QX? The assumption it's but revenue color profit know a versus of hey, what expect related. guidance dropper. your profit then -- gross given got QX And an flat out

Daniel Boncel

our flat locations and versus Yes, anomalies a cost within region that We're from optimization in still working are particular identify or within regions any outside. higher costs different where gross that model in there's region other through that relatively QX. on profit co-lo region to

structure our looking anomalies our in And and so we're locations, of aspect cost by locations who we're on and of and different every profitability the diving really there. between at serving out

And we upon right overnight. continuously to are be primarily as night-time work our But that improve expect That driver structure. switches we and now, base identifying issues aren't modeling, to existing cost continue through our and we margin driving cost our those customers. customers we improvements. to those of And improvements gross expect structure the can of peak turn the off-peak different in We're improvements that is traffic. can so and that biggest going we improve really but performance make to from really utilization really identifying traffic is how

so things well. term. really through going process other drive expansion to help what's we're working is the long And that there as that not can But dismissing profitability margin and that in gross are

Robert Lyons

color kind the put to about little some modeling Yes. the the of we're Eric, little technology and to optimized add is introducing stochastic but color so optimizing, to revenue that things use doing make -- going margin. for cost our biggest are on implement, optimize. more program gross talk time when a to like we're getting pops And just time we on improve we Obviously, real us to things optimization those that things that, And optimizing. do, linear take going the to fixed when constantly on in to But can more help we're they're we to help. sure a

Operator

Breen James is The William next with from question Blair.

James Breen

the quarter, much million the any, think a a bit of those talk coming lot of comp. the step a quarter about given at It is And income up recognized then then $XX and as of move the the and the and move statement, stock-based a like in R&D the we annualized, you maybe bit comments the was of as revenue G&A in some out, into we quite sort forward? look how do down of cost the there of margins, that So savings second sequentially. that gross on how looks costs rest your about that just you G&A was if quite year? the are the trends we look Can and first

Daniel Boncel

transition I'll Jim, the was in big the award perspective. -- really cleanup there couldn't we've previous modifications variance, the -- from and process that within gone sequentially, Lyons' color item more into an restructuring little was from a sequentially, process the go as Bob here, Thanks, add on line through restructuring management through some tenure in really equity accounting And G&A. Yes. team

in increase quarter-over-quarter. And expenses what drove so that's G&A the

$XX R&D to and of million $XX million $X the through that there item. forward, Going in $X another in G&A. $X.X revenue and million of through sales million line marketing flowing that be flows going is primarily cost $X.X million within with and million

QX. And QX. away those were see right so, benefits of None we'll recognized in those in

those reduction to line anywhere so, in $X a reduction from see And of expect items million as we million to result workforce. $X the in

James Breen

And a Is go that does away quarter? G&A, And so back item now? the the elevated to [indiscernible] that? basically that onetime in

Daniel Boncel

That's time. One right.

James Breen

the $X how just range? that? much of sort that in And was Was million

Daniel Boncel

Right on.

Operator

and is from Company. with Cowen next The question Synesael Colby

Michael Elias

Hi, Colby. this questions, is Two if Michael on for I may.

deeper further to step of be sure I to is want this up it lows about about also, when performance form they into planning I'm is the think what believe make summer, Or the days, strategy for that market a market saw? update clear. the Should over want you're that increased dive of you increased you your should any First, current just drive seen issues? just share above will the improvements then clear, long-term expect? continued XX before investors Just you share. we that relative talk guidance expect some to early or when had strategy? operational you a And next what

Robert Lyons

to and I'll start work front of Yes. your the back the with question. end end

back really on end, two there's drivers. So the

We of expanding we rapidly top have the top much probably And then are there of pie the how our to the they're with. share significantly of is And expanding. much is there's customers, get. begin and also how pretty X most

share percentage of so the we expanding X the not And over but we pie, we lost our relative only lost past, of to -- quarters, share overall. say, let's have our

and the higher see both capturing And We so we overall, a percentage pie see expanding. of is that.

front sequentially the upside. bright. long-term into we're here's guidance. to get question on, focused of the that more don't here's market, future win going there And be we're been be we'll it know the have I be Dan the part expect we're to why here's price your talked going, saying going, ways we of and where about, we've would the and in generally why the But what Limelight speaking, should compression previous here's than should that that I to years. on better we've Obviously, So through. then with work got strategy, is

thinking putting a is things, of obviously, and walk behind pieces platform that you multiples. and value. going they're detailed really expand those to grow. I largely We growth exactly will to that and our you be more understanding probably X the to prove understand map, so conversation it. the how around win they're that that should away But shareholder I mean and view profitability Ultimately, we're are together share a our it road way a thesis how will the plan our building from we what understand also

-- we're So what focused on. we're that's

Operator

is question Northland with Capital. next Latimore The Instructions]. Michael from [Operator

Aditya Dagaonkar

the as the they behalf on about Aditya on do you the gaming and you're growth in total how is a Can of they of Michael comment Latimore. vertical? growing? been contribute seeing and how revenue, revenue? have And traction events-related this that the also, Hi, And percentage much sports live

Daniel Boncel

revenue. delivery represents Yes. about don't past the in it majority We of break those that XX% down We've of our our in mentioned total terms. the

that's the of that there monthly amount share revenue. quarterly our the a that's events time. And live significant are there, other so is delivery revenue lion's and gaming not in video And or this lion's and The of is but share. at point

Robert Lyons

that In in an we're of summer and area live we can be we'll will win play streaming, strategy detail -- on the -- events, where real-time more that should, that how we in there. That's the discuss mid and Yes. early focused session.

Operator

to to question-and-answer our concludes remarks. over the closing conference any Lyons like I session. back turn would Bob This for

Robert Lyons

everyone, Thank us with you, made XX In you, my days, operator, meaningful joining progress for do. and more much to have today. first thank we

forward go platform on we our a in are updating so. our progress optimistic forward. as on growth We do are we and you We to the building profitable to across laser-focused you. look organization, ability Thank for

Operator

you concluded. now for presentation. today's attending The Thank conference has

You may now disconnect.

Edgio (EGIOQ) 30 Apr 212021 Q1 Earnings call transcript