PubMatic, Inc. (Nasdaq: PUBM), an independent technology company
delivering digital advertising’s supply chain of the future, today
reported financial results for the third quarter ending
September 30, 2023.
“This quarter highlights an inflection point for
PubMatic and the sell side technology category. Our innovation
investments are driving momentum in the business and fueling our
growth expectations for the fourth quarter. In the third quarter,
we added new logos, strengthened publisher and buyer relationships
and expanded our offerings. Supply Path Optimization (SPO) share of
activity climbed to 45%, showcasing the upside growth potential
inherent in our business,” said Rajeev Goel, co-founder and CEO at
PubMatic. “As our industry matures, there is an ongoing imperative
for greater control over the digital advertising supply chain and
increased efficiency across the ecosystem. These trends are forcing
publishers and buyers to re-construct their supply chains and
PubMatic is a key partner in this process. We believe our
innovative vision, expanding and integrated product suite, and
differentiated infrastructure position PubMatic for long-term
growth and market share gains.”
Third Quarter 2023 Financial
Highlights
- Revenue in the
third quarter of 2023 was $63.7 million, compared to $64.5 million
in the same period of 2022;
- Revenue from
Connected TV (CTV) in the third quarter of 2023 grew 5%
sequentially over the second quarter of 2023, and declined 3%
compared to the same period last year which had grown over
150%;
- Net dollar-based
retention1 was 97% for the trailing twelve-months ended
September 30, 2023, compared to 120% in the comparable
trailing twelve-month period a year ago;
- GAAP net income was
$1.8 million with a margin of 3%, or $0.03 per diluted share in the
third quarter, compared to GAAP net income of $3.3 million with a
margin of 5%, or $0.06 per diluted share in the same period of
2022;
- Adjusted EBITDA was
$18.2 million, or 29% margin, compared to adjusted EBITDA2 of $25.1
million, or a 39% margin, in the same period of 2022;
- Non-GAAP net income
was $7.6 million, or $0.14 per diluted share in the third quarter,
compared to Non-GAAP net income2 of $12.2 million, or $0.21 per
diluted share in the same period of 2022;
- Net cash provided
by operating activities was $23.8 million, compared to $28.1
million in the same period of 2022;
- Total cash, cash
equivalents, and marketable securities of $171.4 million as of
September 30, 2023 with no debt;
- Through October 31,
2023, used $46.6 million in cash to repurchase
3.3 million shares of Class A common stock. We have
$28.4 million remaining in the repurchase program.
The section titled “Non-GAAP Financial Measures”
below describes our usage of non-GAAP financial measures.
Reconciliations between historical GAAP and non-GAAP information
are contained at the end of this press release following the
accompanying financial data.
Business Highlights
- Supply Path
Optimization accelerated to 45% of total activity on our platform
in Q3 2023, up from over 30% a year ago, driven by multi-year,
strategic partnerships with top ad agencies and advertisers looking
to drive increased return on investment across formats and
channels.
- Diversified across more than 20
verticals. The top 10 ad verticals, in aggregate, grew 8% year over
year.
- Processed nearly 56 trillion
impressions in Q3 2023, an increase of 33% over Q3 2022.
- Grew active
publishers on the PubMatic platform 11% over Q3 2022, monetizing
inventory from over 1,750 global publishers and app
developers.
- Revenue from omnichannel video, which
includes desktop, mobile and CTV devices, represented 33% of total
revenue in the third quarter.
- Launched Activate
offering in the Asia-Pacific region with partners Dentsu APAC,
iQIYI, Kinesso India, Madison Digital and Wishmedia. Activate
facilitates the shift from conventional direct transactions to
programmatic private marketplace or programmatic guaranteed deals
for CTV/OTT and online video.
- Expanded
partnership with Freewheel. Through this enhanced integration,
PubMatic’s Activate now has direct access to premium publisher CTV
ad inventory on Freewheel.
- Developed and
scaled a portfolio approach to help publishers and buyers move
beyond the limitations of anonymous targeting solutions. Nearly 75%
of impressions on our platform have alternative targeting signals
attached other than the cookie, providing hundreds of billions of
ad impressions daily for buyers to transact on.
- Infrastructure
optimization initiatives continue ahead of schedule, bringing total
capex for 2023 down approximately 70% compared to 2022.
- Cost of revenue per
million impressions processed decreased 9% on a trailing twelve
month period, as compared to the prior period.
- Appointed two new
independent directors, Anton Hanebrink, Executive Vice President,
Chief Corporate Strategy & Development Officer of Intuit, Inc.,
and Nick Mehta, Chief Executive Officer of Gainsight, Inc.
“Q3 out-performance was driven by solid
execution across the business and highlights improving trends in
our core business and growing contributions from our innovation
investments. We generated $17.2 million in free cash flow, the
highest quarterly level in nearly two years,” said Steve Pantelick,
CFO at PubMatic. “With relentless focus on our key operating
priorities, we have driven new levels of efficiencies in our cost
structure that will lead to margin expansion in 2024 and beyond. We
believe these results lay the foundation for an inflection point in
growth as we continue to scale high value formats like CTV and
online video.”
Financial Outlook
Macroeconomic and geopolitical conditions
continue to be challenging and advertisers remain cautious,
particularly with respect to brand advertising. Our outlook
reflects these challenging conditions alongside recent positive
trends in our business and assume business conditions remain stable
without significant deterioration.
For the fourth quarter of 2023, the company
expects the following:
- Revenue to be
between $76 million to $80 million.
- Adjusted EBITDA to
be in the range of $32 million to $35 million, representing
approximately a 43% margin at the midpoint.
- For full year 2023, the company expects
CapEx to be in the range of $10M – $13M, a decrease of
approximately 70% over 2022.
Although we provide guidance for adjusted
EBITDA, we are not able to provide guidance for net income, the
most directly comparable GAAP measure. Certain elements of the
composition of GAAP net income, including, income taxes and
stock-based compensation expenses, are not predictable, making it
impractical for us to provide guidance on net income or to
reconcile our adjusted EBITDA guidance to net income without
unreasonable efforts. For the same reason, we are unable to address
the probable significance of the unavailable information.
Conference Call and Webcast
details
PubMatic will host a conference call to discuss
its financial results on Wednesday, November 8, 2023 at 2:00
p.m. Pacific Time (5:00 p.m. Eastern Time). A live webcast of the
call can be accessed from PubMatic’s Investor Relations website at
https://investors.pubmatic.com. An archived version of the webcast
will be available from the same website after the call.
Non-GAAP Financial Measures
In addition to our results determined in
accordance with U.S. generally accepted accounting principles
(GAAP), including, in particular operating income, net cash
provided by operating activities, and net income (loss), we believe
that adjusted EBITDA, non-GAAP net income, and free cash flow, each
a non-GAAP measure, are useful in evaluating our operating
performance. We define adjusted EBITDA as net income (loss)
adjusted for stock-based compensation expense, depreciation and
amortization, unrealized gain, loss or impairment of equity
investment, interest income, acquisition-related and other
expenses, and provision for (benefit from) income taxes. Adjusted
EBITDA margin represents adjusted EBITDA calculated as a percentage
of revenue. We define non-GAAP net income as net income (loss)
adjusted for unrealized (gain) loss on equity investments,
stock-based compensation expense, acquisition-related and other
expenses, and adjustments for income taxes. We define non-GAAP free
cash flow as net cash provided by operating activities reduced by
purchases of property and equipment and capitalized software
development costs.
In addition to operating income and net income,
we use adjusted EBITDA, non-GAAP net income, and free cash flow as
measures of operational efficiency. We believe that these non-GAAP
financial measures are useful to investors for period to period
comparisons of our business and in understanding and evaluating our
operating results for the following reasons:
- Adjusted EBITDA,
non-GAAP net income and free cash flow are widely used by investors
and securities analysts to measure a company’s operating
performance without regard to items such as stock-based
compensation expense, depreciation and amortization, interest
expense, and provision for (benefit from) income taxes that can
vary substantially from company to company depending upon their
financing, capital structures and the method by which assets were
acquired; and,
- Our management uses
adjusted EBITDA, non-GAAP net income, and free cash flow in
conjunction with GAAP financial measures for planning purposes,
including the preparation of our annual operating budget, as a
measure of operating performance and the effectiveness of our
business strategies and in communications with our board of
directors concerning our financial performance; and adjusted EBITDA
provides consistency and comparability with our past financial
performance, facilitates period-to-period comparisons of
operations, and also facilitates comparisons with other peer
companies, many of which use similar non-GAAP financial measures to
supplement their GAAP results.
Our use of non-GAAP financial measures has
limitations as an analytical tool, and you should not consider them
in isolation or as a substitute for analysis of our financial
results as reported under GAAP. Some of these limitations are as
follows:
- Adjusted EBITDA
does not reflect: (a) changes in, or cash requirements for, our
working capital needs; (b) the potentially dilutive impact of
stock-based compensation; or (c) tax payments that may represent a
reduction in cash available to us;
- Although
depreciation and amortization expense are non-cash charges, the
assets being depreciated and amortized may have to be replaced in
the future, and adjusted EBITDA does not reflect cash capital
expenditure requirements for such replacements or for new capital
expenditure requirements; and
- Non-GAAP net income
does not include: (a) unrealized gains/losses resulting from our
equity investment; (b) the potentially dilutive impact of
stock-based compensation; (c) income tax effects for stock-based
compensation and unrealized gains/losses from our equity
investment; or (d) acquisition-related and other expenses.
Because of these and other limitations, you
should consider adjusted EBITDA, non-GAAP net income, and free cash
flows along with other GAAP-based financial performance measures,
including net income (loss) and our GAAP financial results.
Forward Looking Statements
This press release contains “forward-looking
statements” regarding our future business expectations, including
our guidance relating to our revenue and adjusted EBITDA for Q4
2023 and full year 2023, our expectations regarding future hiring,
our total addressable market, future market growth, and our ability
to gain market share. These forward-looking statements are based on
our current expectations and assumptions regarding our business,
the economy and other future conditions and may differ materially
from actual results due to a variety of factors including: our
dependency on the overall demand for advertising and the channels
we rely on; our existing customers not expanding their usage of our
platform, or our failure to attract new publishers and buyers; our
ability to maintain and expand access to spend from buyers and
valuable ad impressions from publishers; the rejection of the use
of digital advertising by consumers through opt-in, opt-out or
ad-blocking technologies or other means; our failure to innovate
and develop new solutions that are adopted by publishers; the war
between Ukraine and Russia and the related measures taken in
response by the global community; the impacts of inflation as well
as fiscal tightening and rising interest rates; lingering effects
of the COVID-19 pandemic, including the resulting global economic
uncertainty; limitations imposed on our collection, use or
disclosure of data about advertisements; the lack of similar or
better alternatives to the use of third-party cookies, mobile
device IDs or other tracking technologies if such uses are
restricted; any failure to scale our platform infrastructure to
support anticipated growth and transaction volume; any ability of
our DSP buyers to make payments to us, including due to financial
difficulties they may experience; liabilities or fines due to
publishers, buyers, and data providers not obtaining consents from
consumers for us to process their personal data; any failure to
comply with laws and regulations related to data privacy, data
protection, information security, and consumer protection; and our
ability to manage our growth. Moreover, we operate in a competitive
and rapidly changing market, and new risks may emerge from time to
time. For more information about risks and uncertainties associated
with our business, please refer to the “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” and
“Risk Factors” sections of our Annual Report on Form 10-K for the
year ended December 31, 2022, which is on file with the SEC and is
available on our investor relations website at
https://investors.pubmatic.com and on the SEC website at
www.sec.gov. Additional information will also be set forth in our
Quarterly Report on Form 10-Q for the quarter ended
September 30, 2023. All information in this press release is
as of November 8, 2023. We undertake no obligation to update
any forward-looking statement, whether as a result of new
information, future developments or otherwise, except as may be
required by law.
About PubMatic
PubMatic is an independent technology company
maximizing customer value by delivering digital advertising’s
supply chain of the future. PubMatic’s sell-side platform empowers
the world’s leading digital content creators across the open
internet to control access to their inventory and increase
monetization by enabling marketers to drive return on investment
and reach addressable audiences across ad formats and devices.
Since 2006, PubMatic’s infrastructure-driven approach has allowed
for the efficient processing and utilization of data in real time.
By delivering scalable and flexible programmatic innovation,
PubMatic improves outcomes for its customers while championing a
vibrant and transparent digital advertising supply chain.
CONDENSED CONSOLIDATED BALANCE SHEETS |
(In thousands) |
(unaudited) |
|
|
September 30,2023 |
|
December 31,2022 |
ASSETS |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ |
97,730 |
|
|
$ |
92,382 |
|
Marketable securities |
|
73,623 |
|
|
|
82,013 |
|
Accounts receivable, net |
|
291,385 |
|
|
|
314,299 |
|
Prepaid expenses and other
current assets |
|
11,634 |
|
|
|
14,784 |
|
Total current assets |
|
474,372 |
|
|
|
503,478 |
|
Property, equipment and
software, net |
|
61,915 |
|
|
|
71,156 |
|
Operating lease right-of-use
assets |
|
21,768 |
|
|
|
26,206 |
|
Acquisition-related intangible
assets, net |
|
6,259 |
|
|
|
8,299 |
|
Goodwill |
|
29,577 |
|
|
|
29,577 |
|
Deferred tax assets |
|
14,659 |
|
|
|
1,047 |
|
Other assets, non-current |
|
4,436 |
|
|
|
2,412 |
|
TOTAL ASSETS |
$ |
612,986 |
|
|
$ |
642,175 |
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
$ |
273,169 |
|
|
$ |
277,414 |
|
Accrued liabilities |
|
25,031 |
|
|
|
18,936 |
|
Operating lease liabilities,
current |
|
5,667 |
|
|
|
5,676 |
|
Total current liabilities |
|
303,867 |
|
|
|
302,026 |
|
Operating lease liabilities,
non-current |
|
16,809 |
|
|
|
20,915 |
|
Other liabilities,
non-current |
|
3,736 |
|
|
|
7,046 |
|
TOTAL LIABILITIES |
|
324,412 |
|
|
|
329,987 |
|
Stockholders' equity |
|
|
|
Common stock |
|
6 |
|
|
|
6 |
|
Treasury stock |
|
(50,804 |
) |
|
|
(11,486 |
) |
Additional paid-in
capital |
|
221,205 |
|
|
|
195,677 |
|
Accumulated other
comprehensive loss |
|
(12 |
) |
|
|
(9 |
) |
Retained earnings |
|
118,179 |
|
|
|
128,000 |
|
TOTAL STOCKHOLDERS’
EQUITY |
|
288,574 |
|
|
|
312,188 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
$ |
612,986 |
|
|
$ |
642,175 |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands, except per share data) |
(unaudited) |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
63,677 |
|
|
$ |
64,500 |
|
|
$ |
182,414 |
|
|
$ |
182,084 |
|
Cost of revenue(1) |
|
26,091 |
|
|
|
21,591 |
|
|
|
75,021 |
|
|
|
58,557 |
|
Gross profit |
|
37,586 |
|
|
|
42,909 |
|
|
|
107,393 |
|
|
|
123,527 |
|
Operating expenses:(1) |
|
|
|
|
|
|
|
Technology and development |
|
6,634 |
|
|
|
5,080 |
|
|
|
19,881 |
|
|
|
14,928 |
|
Sales and marketing |
|
19,513 |
|
|
|
16,087 |
|
|
|
62,450 |
|
|
|
50,755 |
|
General and administrative(2) |
|
12,010 |
|
|
|
12,120 |
|
|
|
43,439 |
|
|
|
33,847 |
|
Total operating expenses |
|
38,157 |
|
|
|
33,287 |
|
|
|
125,770 |
|
|
|
99,530 |
|
Operating income (loss) |
|
(571 |
) |
|
|
9,622 |
|
|
|
(18,377 |
) |
|
|
23,997 |
|
Interest income |
|
2,246 |
|
|
|
596 |
|
|
|
6,313 |
|
|
|
1,044 |
|
Other income (expense), net |
|
210 |
|
|
|
(5,494 |
) |
|
|
(476 |
) |
|
|
(4,389 |
) |
Income (loss) before income
taxes |
|
1,885 |
|
|
|
4,724 |
|
|
|
(12,540 |
) |
|
|
20,652 |
|
Provision for (benefit from)
income taxes |
|
111 |
|
|
|
1,398 |
|
|
|
(2,719 |
) |
|
|
4,728 |
|
Net income (loss) |
$ |
1,774 |
|
|
$ |
3,326 |
|
|
$ |
(9,821 |
) |
|
$ |
15,924 |
|
|
|
|
|
|
|
|
|
Basic net income (loss) per
share of Class A and Class B stock |
$ |
0.03 |
|
|
$ |
0.06 |
|
|
$ |
(0.19 |
) |
|
$ |
0.31 |
|
Diluted net income (loss) per
share of Class A and Class B stock |
$ |
0.03 |
|
|
$ |
0.06 |
|
|
$ |
(0.19 |
) |
|
$ |
0.28 |
|
Weighted-average shares used
to compute net income per share attributable to common
stockholders: |
|
|
|
|
|
|
|
Basic |
|
51,638 |
|
|
|
52,436 |
|
|
|
52,132 |
|
|
|
52,169 |
|
Diluted |
|
55,979 |
|
|
|
56,944 |
|
|
|
52,132 |
|
|
|
56,895 |
|
(1)Stock-based compensation expense includes the following:
STOCK-BASED COMPENSATION EXPENSE |
(In thousands) |
(unaudited) |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
Cost of revenue |
$ |
387 |
|
$ |
256 |
|
$ |
1,089 |
|
$ |
861 |
Technology and
development |
|
1,112 |
|
|
683 |
|
|
3,209 |
|
|
2,467 |
Sales and marketing |
|
2,550 |
|
|
1,735 |
|
|
7,873 |
|
|
5,740 |
General and
administrative |
|
3,151 |
|
|
1,981 |
|
|
9,354 |
|
|
6,114 |
Total stock-based compensation expense |
$ |
7,200 |
|
$ |
4,655 |
|
$ |
21,525 |
|
$ |
15,182 |
(2)On June 30, 2023, a Demand Side Platform
buyer of our platform filed for Chapter 11 bankruptcy. As a result
of this bankruptcy, we recorded incremental bad debt expense of
$5.7 million which is reflected in our GAAP net loss and adjusted
EBITDA results for the nine month period ending September 30,
2023.
CONDENSED CONSOLIDATED STATEMENT OF CASH
FLOWS |
(In thousands) |
(unaudited) |
|
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
CASH FLOW FROM
OPERATING ACTIVITIES: |
|
|
|
Net income (loss) |
$ |
(9,821 |
) |
|
$ |
15,924 |
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: |
|
|
|
Depreciation and amortization |
|
33,731 |
|
|
|
23,587 |
|
Unrealized loss and impairment of equity investment |
|
— |
|
|
|
5,948 |
|
Stock-based compensation |
|
21,525 |
|
|
|
15,182 |
|
Provision for doubtful accounts |
|
5,675 |
|
|
|
— |
|
Deferred income taxes |
|
(14,185 |
) |
|
|
(3,949 |
) |
Accretion of discount on marketable securities |
|
(3,061 |
) |
|
|
(170 |
) |
Non-cash operating lease expense |
|
4,605 |
|
|
|
4,292 |
|
Other |
|
3 |
|
|
|
98 |
|
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable |
|
8,367 |
|
|
|
12,626 |
|
Prepaid expenses and other assets |
|
3,501 |
|
|
|
(1,354 |
) |
Accounts payable |
|
4,141 |
|
|
|
4,013 |
|
Accrued liabilities |
|
3,214 |
|
|
|
(4,806 |
) |
Operating lease liabilities |
|
(4,282 |
) |
|
|
(3,985 |
) |
Other liabilities, non-current |
|
(966 |
) |
|
|
448 |
|
Net cash provided by operating
activities |
|
52,447 |
|
|
|
67,854 |
|
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
|
Purchases of property and equipment |
|
(5,424 |
) |
|
|
(26,961 |
) |
Capitalized software development costs |
|
(13,725 |
) |
|
|
(9,597 |
) |
Purchases of marketable securities |
|
(76,932 |
) |
|
|
(100,113 |
) |
Proceeds from sales of marketable securities |
|
18,873 |
|
|
|
— |
|
Proceeds from maturities of marketable securities |
|
69,500 |
|
|
|
63,200 |
|
Business combination, net of cash acquired |
|
— |
|
|
|
(28,085 |
) |
Net cash used in investing
activities |
|
(7,708 |
) |
|
|
(101,556 |
) |
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
|
Proceeds from issuance of common stock for employee stock purchase
plan |
|
971 |
|
|
|
2,402 |
|
Proceeds from exercise of stock options |
|
1,210 |
|
|
|
1,060 |
|
Principal payments on finance lease obligations |
|
(93 |
) |
|
|
(88 |
) |
Payments to acquire treasury stock |
|
(41,479 |
) |
|
|
— |
|
Net cash provided by (used in)
financing activities |
|
(39,391 |
) |
|
|
3,374 |
|
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS |
|
5,348 |
|
|
|
(30,328 |
) |
CASH AND CASH EQUIVALENTS -
Beginning of period |
|
92,382 |
|
|
|
82,505 |
|
CASH AND CASH EQUIVALENTS -
End of period |
$ |
97,730 |
|
|
$ |
52,177 |
|
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
MEASURES |
(In thousands, except per share amounts) |
(unaudited) |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of net
income (loss): |
|
|
|
|
|
|
|
Net income (loss) |
$ |
1,774 |
|
|
$ |
3,326 |
|
|
$ |
(9,821 |
) |
|
$ |
15,924 |
|
Add back (deduct): |
|
|
|
|
|
|
|
Stock-based compensation |
|
7,200 |
|
|
|
4,655 |
|
|
|
21,525 |
|
|
|
15,182 |
|
Depreciation and
amortization |
|
11,401 |
|
|
|
9,082 |
|
|
|
33,731 |
|
|
|
23,587 |
|
Unrealized loss and impairment
of equity investment |
|
— |
|
|
|
6,405 |
|
|
|
— |
|
|
|
5,948 |
|
Interest income |
|
(2,246 |
) |
|
|
(596 |
) |
|
|
(6,313 |
) |
|
|
(1,044 |
) |
Acquisition-related and other
expenses3 |
|
— |
|
|
|
867 |
|
|
|
— |
|
|
|
867 |
|
Provision for (benefit from)
income taxes |
|
111 |
|
|
|
1,398 |
|
|
|
(2,719 |
) |
|
|
4,728 |
|
Adjusted EBITDA |
$ |
18,240 |
|
|
$ |
25,137 |
|
|
$ |
36,403 |
|
|
$ |
65,192 |
|
Revenue |
$ |
63,677 |
|
|
$ |
64,500 |
|
|
$ |
182,414 |
|
|
$ |
182,084 |
|
Adjusted EBITDA margin |
|
29 |
% |
|
|
39 |
% |
|
|
20 |
% |
|
|
36 |
% |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of net
income (loss) per share: |
|
|
|
|
|
|
|
Net income (loss) |
$ |
1,774 |
|
|
$ |
3,326 |
|
|
$ |
(9,821 |
) |
|
$ |
15,924 |
|
Add back (deduct): |
|
|
|
|
|
|
|
Unrealized loss and impairment
of equity investment |
|
— |
|
|
|
6,405 |
|
|
|
— |
|
|
|
5,948 |
|
Stock-based compensation |
|
7,200 |
|
|
|
4,655 |
|
|
|
21,525 |
|
|
|
15,182 |
|
Acquisition-related and other
expenses1 |
|
— |
|
|
|
867 |
|
|
|
— |
|
|
|
867 |
|
Adjustment for income
taxes |
|
(1,397 |
) |
|
|
(3,032 |
) |
|
|
(4,105 |
) |
|
|
(4,616 |
) |
Non-GAAP net income |
$ |
7,577 |
|
|
$ |
12,221 |
|
|
$ |
7,599 |
|
|
$ |
33,305 |
|
GAAP diluted EPS |
$ |
0.03 |
|
|
$ |
0.06 |
|
|
$ |
(0.19 |
) |
|
$ |
0.28 |
|
Non-GAAP diluted EPS |
$ |
0.14 |
|
|
$ |
0.21 |
|
|
$ |
0.13 |
|
|
$ |
0.59 |
|
GAAP weighted average shares
outstanding—diluted |
|
55,979 |
|
|
|
56,944 |
|
|
|
52,132 |
|
|
|
56,895 |
|
Non-GAAP weighted average
shares outstanding—diluted |
|
55,979 |
|
|
|
56,944 |
|
|
|
56,394 |
|
|
|
56,895 |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Reconciliation of cash
provided by operating activities: |
|
|
|
|
|
|
|
Net cash provided by operating
activities |
$ |
23,845 |
|
|
$ |
28,072 |
|
|
$ |
52,447 |
|
|
$ |
67,854 |
|
Less: Purchases of property and equipment |
|
(2,872 |
) |
|
|
(14,577 |
) |
|
|
(5,424 |
) |
|
|
(26,961 |
) |
Less: Capitalized software development costs |
|
(3,806 |
) |
|
|
(2,820 |
) |
|
|
(13,725 |
) |
|
|
(9,597 |
) |
Free cash flow |
$ |
17,167 |
|
|
$ |
10,675 |
|
|
$ |
33,298 |
|
|
$ |
31,296 |
|
1 Net dollar-based retention is calculated by starting with the
revenue from publishers in the trailing twelve months ended
September 30, 2022 (Prior Period Revenue). We then calculate the
revenue from these same publishers in the trailing twelve months
ended September 30, 2023 (Current Period Revenue). Current Period
Revenue includes any upsells and is net of contraction or
attrition, but excludes revenue from new publishers. Our net
dollar-based retention rate equals the Current Period Revenue
divided by Prior Period Revenue. Net dollar-based retention rate is
an important indicator of publisher satisfaction and usage of our
platform, as well as potential revenue for future periods
2 On a go forward basis, we are no longer excluding the impact
of post-acquisition cash compensation agreements for certain key
acquired employees from the Martin acquisition from Adjusted EBITDA
and Non-GAAP net income. Prior period amounts for Adjusted EBITDA
and Non-GAAP net income have been updated to conform to the current
period presentation. For comparative purposes, the impact of this
change to our adjusted EBITDA and Non-GAAP net income for the three
and nine months ended September 30, 2022 is a decrease to Adjusted
EBITDA income and Non-GAAP net income of $0.2 million.
3 On a go forward basis, we are no longer
excluding the impact of post-acquisition cash compensation
agreements for certain key acquired employees from the Martin
acquisition from Adjusted EBITDA and Non-GAAP net income. Prior
period amounts for Adjusted EBITDA and Non-GAAP net income have
been updated to conform to the current period presentation. For
comparative purposes, the impact of this change to our adjusted
EBITDA and Non-GAAP net income for the three and nine months ended
September 30, 2022 is a decrease to Adjusted EBITDA income and
Non-GAAP net income of $0.2 million.
Investors:
The Blueshirt Group for PubMatic
investors@pubmatic.com
Press Contact:
Broadsheet Communications for PubMatic
pubmaticteam@broadsheetcomms.com
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