ATY - Earnings call transcript Q1 2022

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Operator

Good morning, everyone.

Before we begin the official remarks, I will read the cautionary note regarding forward-looking information. Certain information to be discussed during this call contains forward-looking statements within the meaning of applicable security laws, including among others, statements concerning the company's objectives, the company's strategy to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates and intention, and similar statements concerning anticipated, future events, results, circumstances, performance, or expectations that are not historical facts. Such forward-looking statements reflects management's current beliefs and are based on information currently available to management, and is subject to a number of significant risks and uncertainties that could cause actual results to defer materially from those anticipated. Please refer to the cautionary statements and the risk factors identified in our filings with CEDAR and EDGAR for a more detailed explanation of the inherent risks and uncertainties that could affect such forward-looking statements.

will Q&A we presentation, the conduct session. a Following operations turn call Chief over would on Officer now Hayek, conference to like the you update and I Tal the the AcuityAds to the of business. of Executive Co-Founder

Tal Hayek

coming Hayek, QX My CEO Acuity family, co-founder to Presentation, XXXX It my implement Investor Tal AcuityAds. from you welcome the I’m I'm start pleasure Toronto the by reorganization I'd Video about office. Good morning, to the is all we and everyone. is earmarked name and to of to was you to and for like QX and growth. live our that hard lot a thinking working investments our

such amazing for on you doing thank So an job that.

million. to in change box, was between revenue, way big they A way lot last and now QX XX% while XXX% it. delivered execute expected, illumin solves gap Problem number be completely it, continues usually journey. go of marketers seconds. two the which advertising. to As of that very illumin black marketers that disregards the We it from And customer X, programmatic that is QX into million consumer that consumer chunk gets we’ll $X.X plan execute journey. a think huge problems to out revenue. $XX.X due starting think drill there's a in they to huge down That's of there. the executed, a when few world of our to illumin in was down the to year. up concentration, it a that's of XX%

the we of problem easy to one it button. of illumin and And it's the intuitive is gives highly click planning that consumer and journey execute marketer fact highly, with So way use. a a second solve that of

trained a me explain, to you programmatic highly using system a will expert. be today, need Let

on then highly will be and able system training to average only go knowledge training You'll any very minutes. will barely With to execute need in of it. you to that in little that and almost need through to hours any touch training order take it intuitive on away, campaign. and hundreds starting It's you campaigns all a with hours to of on illumin, execute goes person

two those important things it those -- with out two very world its becomes there. solving, So for reasons that very, the tool a

fantastic to team was our our QX, one accountable new crucial, And job our amazing this of on I an crucial to being and CFO organization in Neil, Elliot, doing next end. level us to another. that into While is teams doing organizing COO in organization, amazing work focused job, the back growth. getting job, believe is an is together very the our much take

back buy investment of discussions. the why QX, still to going In $XX.X do was while is And to we all best for of very for our we implementing investments in Our coming is well and these half the doing are that the results growth in cash that this can enough And we're all very, own we're million the our the Acuity knowing financial and from that will year. the dollars expecting is busy we that growth, make. earmarked second starting a team M&A very for in shares. this, Well, we way at delivered bank least believe we're leaving revenue. see

order to going over is we year be and we down as market, As this to expected go year.

the contributing case. coming due have factor with job. market And to. we we we happened our to to what agencies reasons think just it's sometimes, of I revenue in this concentration, the XX% the is one That performance, it before the from that us quarter well, One already that. client, year, that in majority our from ago and a and We was revenue -- of few don't a not I'll while XX% have year communicated it happened amazing. I million changing client come of the the and from X past going had I agency it is in we the revenue major client just that's in the big illumin due QX that business of happens lost in illumin, believe came do to say QX that managed that relationship with that an that again, that Well, of into size side. was illumin was to to came that mean, just

Acuity So news us. for and for great that's

some we're seeing So also client information.

XX So now and had eight clients to last XX had up now year we one we in XX. It's we Tier have clients. QX, clients.

all as our quarters in numbers X.X last -- in this year XXX% all the went great out from signs forward So grow both we up those revenue there. And to well. we're our X.X And seeing looking future year. that's for to year, year million over million

in get and illumin well into also money more but out the people side, Some a We've side the of growth. we We is for the a specific more and support marketing illumin. future. predict XXX% growth. growth, from retail that the big spending on XXX% to our to the the verticals great believe system technology and invest all communicated have for in we're year-over-year, time and and growth XXX% of seeing a growth gaming, we as side seeing more going watch specifically we're in CTV being better the CTV to big ladder continue and XXX% up sales surprise. sales, to in verticals continue going product Continue that that and more growth software not we're in out from very seen we factor. growth it's much, Technology again,

is, it. is we This at believe decided investment and the to Let's it time because the looked companies where we that share we make. something execute We is our price we Acuity talk being about on obviously best program. on can a M&A took do our buyback decide. share many to long side, seeing Why,

So it'll ability days, not M&A that program. to buyback next our also to we're few on say over therefore, execute starting side. though affect And the happy the I'm

with to that all share Elliot like for updates us. to would some financial I update, call great So on

Elliot Muchnik

morning, today. joining and us Good you thank for

results, capabilities. year excited focus and clients. enhance as This While relationships consistent broader, QX our lies platform for will about foundation features actions on functionality each and prove we're is extremely platform ahead more experience. we user's through what to deeper, as important investments our is the benefits to that individual today are our extremely illumin broader the reaching with our of we'll in illumin making realize started expand XXXX, our we continuing last The

headwinds, its discuss place the of to QX, XX.X on QX revenue While we sure all a and are quarter right more the to we and And have global in we our platform, the us like financial XXXX, million for that improving organizational of in the I'd well results. same the as as trying support experiencing for path our one is through the In decrease future, growth keep making XX.X believe to right to improving note, XX.X%. managing continue overall team our to million, investing that capabilities. times the of economy for related our compared was

million information, that off XXXX. from campaign by and This XXXX. did our revenue X in financial from is that As see during COVID-XX one not changes change by campaign again verticals successfully was degree a segmented QX impacted issues. pandemic. year-over-year And large statements disclosed we the in generated campaign of the in this to attributable under initially a benefited the in we driven this -- large legislative Well, have height change supply we to

We number services our in compared in impact Ukraine And XXXX, from consumer in of XX% growing confidence. million campaign, large of And QX focus as by a revenue XX.X of XXXX. driven is in million on increased our clients have decline which the million revenue, impact the fears, decrease from XX.X at the concentrated as to QX, X.X QX increased year-over-year which million recessionary addition to X.X in XX% seen by impacted more was self-serve managed year-over-year. developments a recent have well

Our self-serve versus in XX% of comparable million, in X.X revenue And X.X the versus million was total period. component XXXX. XXXX year represented illumin in this XX% XX% XXXX revenue our total in or QX of or only XX% QX QX

still have XX% year. is of of derived end by target platform our Our to illumin revenues from the

net of component. a XX% profit year to or increase decrease margin profit XX.X% of lower million XX.X in about gross was in XX.X% was in XX.X This gross self-serve revenue revenues prior QX overall to is of Our the result directly related XXXX and our This compared the quarter. lower QX versus QX in XXXX. million the the in

of million XX.X%. XX.X totaled million Our in operating total for XXXX, increase compared same XX.X period expenses an to quarter

I'd while of As by early, our capabilities being the investments expenses cost XX.X% market better through QX to And costs. related of expense which they the in second This half a in listing, recent are the as XXXX. hires like in entirely percentage fees with discuss was XX% share by finally our driven noted, which our restricted to of to driven in million XX% and to and previously increase, legal progress key made XXXX. of align senior the increase NASDAQ compensation meaningfully noted, revenue, this of is in increased drivers or are to stockholders. leadership the still sales, general include listing our our expect insurance, will and encouraged operating expenses, Tal admin costs, contribute based by versus compensation QX XXX% the as and that by management And share we the interest over increase majority almost including units issuance increased X.X XXXX.

decline of EBITDA QX X.X result was this prior of just note contributing as net reversed. loss of XXXX, And income of in I quarter driver to the million of that loss as X.X FX loss a of and this year-over-year loss a QX in compared of of in for million from quarter was million a X.X result to to of XXXX million I'd X.X $X.X an year key Our million factors this QX of described. the largely And QX this million a following only like the year. versus that X.X to end, declined

QX sheet, cash flow X.X we generated operations million. balance the positive of from For

million year. slightly offering from substantially increased subsequent to from by at XXX conversion, the However, million proceeds our XX.X overall our our to the as declined to of due public million the strong position end Year-over-year, flow. due cash impact in cash XXXX cash XX.X last as the of well the balance FX operating

is Some of of basis to XX, common the Acuity with XX.X had fully share a shares outstanding, XX.X March information million diluted as on you corporate XXXX million.

efficiency, summary, despite of illumin our at for place expanding plan. Our cap actions, I for to remain game the expenses future review. XXXX million. it maximizing is subsequent and cash objectives, XX% XXX flow that we're foundation challenging and at more insider key a growth strong about growth, Tal, financial in half in operating market before environment, periods. but And a This I'd managing platform ownership like approximately the especially still second for bit my approximately little in putting the a and our to overarching is our was end for building through of changing buyback platform, back economic And priority hand say concludes believe we QX share a

reflect course committed to during company, that And appropriate at as In strong multiple effective this next of balance on subject And have to or with commence we our our value and on this over guidelines, belief further of potential current near front, capital are exploring targets move May market. And his to use operating the plan, with approval our bid, blackout current Over stock XXXX. economic now we progress will seeing to purchase and million will XXth note bid this automated I time. make purchasing of cash have the in in with not lower normal of to normal X.X acquisition and to we received order for And issuer launch you important it believe will that the period opportunities up we TSX an the to flow through it's the concluding given is hurdle in course strategy. future rules a sheet, landscape, recently which continue that not solid opportunities, for is multiples XX to and to start will a potential shares remain hand value that, agents fully we focused we sheet, will does balance be we engage term. this remarks. know, while our our TSX’s our TSX history announced of believe to As Tal issue months and which periods, course approval. we market is subject an strong the a

Tal Hayek

before Thank a us ready for some million level QX that, I few about to the year's over earmarked the making just all and XX% into growth, marketing may growth, and earmarked for you, growth. for also team of Elliot, going all go this of remind getting go -- the in busy implementing investment. reorganizing Q&A, those doing investment next $XX we're you about way that remarks. we're we’re into we on of we closing was and which the If to was sales and was

to is to top last shared see line As year, growth in XX% the that going second half. going to it the we believe time, XX% this and of we come majority we're

that joining this all we're and quarter. the into family for again, I'd thank go to today like to you going all And Q&A us now. of for delivering with Acuity to So

Operator

from [Operator first question Canaccord. Instructions] at Your comes Aravinda

Aravinda Galappatthige

perhaps supply straight we're I'll end and the you spend forth. I just jump it's of that regardless. the it. that thoughts XXXX. [Indiscernible] on going that, don't would or Tal the about given seeing not tough, chain, team now most mean, Why So there you've into right fears through that? are your recessionary talked tough. probably hired go remain at If conditions I to spend reconsider conditions so know get you about you is likely the

Tal Hayek

investment. You're talking the about

Aravinda Galappatthige

Yes.

Tal Hayek

get to more the and of order think so. in important it out we're I But it, in and saying is very grow I'm illumin while adoption also more Look, there, doing to investment the stages.

So it whole for. not that the not spend results, everything reason we And for and we're expecting see the scale we back have to spend did earmarked if same we, the not we some thing. to ability

Aravinda Galappatthige

ramping of -- that the team, to sales conversations that days, sale then my we that but clients, one with of can at know and still anything early anything Tal. second the to the maybe of probably that, you're tier in can terms -- connected of they And books the coming incoming share? respect were maybe question. you're getting provide feedback out sort I the that of I stages having some to latter there in the know is you talent? the with you initial stands

Tal Hayek

out now. it all, So even sales aware always first good know to it sales there, people everybody's it's is we So I right? something of was people unique -- that hard hard how now right have get talent and harder, but very

the Something we before, have never had we illumin.

getting are able and they're excited. get, normally that we to So, very we would people not be

And our far numbers, the XX%. by team increased sales so we by

of a it. and people not of in part Like and with very in they excitement results would before, of say in to I a coming we're on very with -- coming doing business, I've shared the lot We're want we're of a that type they're the they're well. So going in. be happy with that book people it's coming with only illumin

very progress. So with very, happy I'm the

so those know we're time make pays and that excited the growth. future little investments of back. a things, you every we sort why then about delay there's that's bit and So in it the Because

Operator

Our comes from next Needham Martin question Company. Laura and of

Dan Medina

that are Dan two -- and the in Hi couple slowness taking of question travel for hospitality. some quarter, you verticals, sort of in Hope thanks out last a My in questions, guys. It's for called Laura. questions. and your had well, Medina particularly you're in calling the

and last And – your great for on seeing calling before going are year? you that, thank congratulations question that But so rest of hospitality then should I and that on the are question out what forward would taking potential, you question. And travel you spend verticals is side, seeing level it -- for And back some the That's ask the is the say that say do for absolute showing G&A two, my you quarter, one. be for we to that. this I the rest what are spend you're going the quarter? at my of And on what of question, of question XXXX? does so --

Elliot Muchnik

no No, problem.

the I'll first So take one.

the second. take You'll

advertise. and things see, up trying entertainment, to. seats money. all flights were to not way they're and just is full without for a aggressive prices you sector is that's everybody's that to needing than I'm one of guess Again, my spending it's filling tickets, still So travel book of used now a those that uh, is lot traveling and guess, the everything time are more that

little It's to start of it's side time, So, the again. going aggressively travel more obviously, happen. for still the in going customers growth to going that's they're it's to matter expected we growing until and my continue But have QX we a of take more fighting seen future. assumption longer in things. a And on to

reminder, XX% and a nowhere it's be near that Tal, if of just As second the now. it one. answer used you’ll to our business,

Tal Hayek

you, and professional answer of spend is have level of the accounting. year general fairly your admin. because through course, per it that the the some beginning -- for of have is is of in for We the the pertaining most a listing question that the that consistent year, and are the spend. that because over out consistent did insurance other more fees things proper is other part, And of us and things, the in year-end as to rate year of the is Thank Dan. short but the audit smoothed we steady to Majority

Operator

of Rob comes Partners. Wealth Echelon question Goff next Our from

Tal Hayek

us. joining Rob. Thanks for

You are too. on camera

Rob Goff

Thank morning. you. Good

the about camera. Sorry

Tal Hayek

appreciate it. we No,

Rob Goff

year. for bit XX% of look what us in respect hear building guidance, you second to continuing quarter in into very XX% it revenue through seeing your were visibility was the the to to little year? give you the on perhaps to Could you’re With a nice

Tal Hayek

speaking, the of we Like, team brought a we up bigger idea seasoned in existing shorter, but ramp doing very generally that investment making job contracts, longer people, ramp period. And at expect that, also period second up to is started whole up majority in into contracts then And of not it QX. year. getting a more part this in end QX, because do a of we the the case phenomenal there's those was sales longer ramp the it's our and QX there, only period, the the doing but hit out contracts. is of Usually

really right so And the direction. is in going everything

Rob Goff

if ask will where migrating onto may to with traction a of of profiling were just illumin, traction little what seeing, to the Thank illumin. I be with clients Tier-X you legacy you. respect momentum with And accounts were Could to are talk appreciative. greater seeing you you extent seeing there you the bit

Tal Hayek

Yes.

So some there that we over. concentrated but clients it mean, are moving on focus. doing our haven't not I are naturally, that's legacy

great the faster. to to selling. when working I getting the into not It's to we side work And have that illumin So faster. And is into that and the DNA. in in sweet the of DNA, revenue the one people it that's using realize it honest, something system opportunity from on illumin. enterprise And there. we using comes have on we the And completely are brand. do transparent majority believe a the still on are I because They're mid-size seeing and that be and it spot adopting we're of did they're came we're is our think agencies the people that it sales

Operator

Our comes Markets. Martinuzzi Eric next of Lake Street from question Capital

Eric Martinuzzi

margin I the the between a two remind differences a question of could but gross the business? issue, sides had it's the margins, mix you gross us Just again, regarding understand

Tal Hayek

sorry, is Yeah. – XX other way is XX. Self-serve the and and about manage Self-serve XX. And around around, managed? plus, self-serve is around

Eric Martinuzzi

just throughout the in your cost? it to at those change year? words, or mix other any In is expect you do costs, media all And the the revenue really change media

Tal Hayek

very happen, of side, some will don't on we could big any that huge the there the would I well. be huge as be the at end come contract but with sign pressure changes. if self-serve might revenue expect I the so it mean, then a on margin, it the day,

Eric Martinuzzi

bit the we the Is -- I but up, step reiterating to that big is second understand you're second I we on XX% XX%. you're investments granular support more about to then, year? should it up. quarter? are growing in wanted revenue forecast. making how think Is the quarter single-digits? a And this step year on to Double-digits? little a big I get the That know

Tal Hayek

second Well, part obviously, the we're in the year. of growing

You are talking sorry. about quarter, second

Eric Martinuzzi

quarter. Second

Tal Hayek

that we Yeah, second wouldn't quarter, have on I say yet. direction a clear

year. So I focus the the second of on would part

in. So that's And this is we're coming QX where and growth seeing QX. the

Operator

Our comes of Partners. from Dillon ROTH next Heslin question Capital

Dillon Heslin

of you XQ, think actually revenue in illumin. of that the rate implies? on the you what the run talk Like about by First do like dollar end majority sort of being year, that

Tal Hayek

to hope Well, going that, XX% trending. the it's it as but I its looks be way more going think to I it's than be that's over and

If even of you see every we're over percentage entire the illumin quarter can the increasing revenue.

that we're and clients within start moving more want to And that so to I able would way and the to to believe than be be to idea system. eliminate things we it's XX%, XX%, illumin of more than the -- existing more we're like is eventually, but and the we the eliminate more hoping I into going old what our whole to do illumin building mean,

Dillon Heslin

XXX. I if gets like, up of is -- Like, you sort sort of that? growth on follow like just mean, I can XX% the

not So I at XX%? mean two right? It's for exiting year, for like XX%, the year it's

Tal Hayek

the run QX at XX%. rate Yeah, over should be

Dillon Heslin

visibility do have how with you mean to to sales? much have? illumin new And what and like needs products how you versus from get new those come already then, Like there, customers I much

Tal Hayek

company entire illumin of product. really it sells majority seeing so. old we're And sells is new in Well, clients the the what we're bringing Nobody in it. today all time, onto the the

new seen a legacy into which combination. that more combination clients spend say, illumin we’ve of moving customers on existing then are a also bringing on and I would happens in increasing clients regular and a basis. It's as it's So, ones. the in board, spending past

Operator

questions more roster. seeing am in the no I

to final it remarks. will So for Tal over hand I back Elliot, you and

Tal Hayek

today everybody's of Daniel. And the thank and to us Analysts to all, again, morning. joining all joining the thanks Bankers, And forward for all us your year. this And you, for investors looking the our support. you Thank second half

illumin (ILLM) 12 May 222022 Q1 Earnings call transcript