☒ | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
2020
☐ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Title of each class | TradingSymbol(s) | Name of each exchangeon which registered | ||
Common Stock, par value $0.001 per share | BCOV | The NASDAQ Global Market |
Large accelerated filer | ☐ | Accelerated filer | ☒ | |||||||
Non-accelerated filer | ☐ (Do not check if a smaller reporting company) | Smaller reporting company | ☐ | |||||||
Emerging growth company | ☐ |
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Brightcove Inc.
Condensed Consolidated Balance Sheets
(unaudited)
September 30, 2019 | December 31, 2018 | |||||||
(in thousands, except share and per share data) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 22,649 | $ | 29,306 | ||||
Accounts receivable, net of allowance of $447 and $190 at September 30, 2019 and December 31, 2018, respectively | 31,485 | 23,264 | ||||||
Prepaid expenses | 5,687 | 4,866 | ||||||
Other current assets | 6,755 | 7,070 | ||||||
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Total current assets | 66,576 | 64,506 | ||||||
Property and equipment, net | 11,142 | 9,703 | ||||||
Operating leaseright-of-use asset | 15,419 | — | ||||||
Intangible assets, net | 14,967 | 5,919 | ||||||
Goodwill | 61,010 | 50,776 | ||||||
Other assets | 3,005 | 2,452 | ||||||
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Total assets | $ | 172,119 | $ | 133,356 | ||||
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Liabilities and stockholders’ equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 11,171 | $ | 7,712 | ||||
Accrued expenses | 18,829 | 13,982 | ||||||
Operating lease liability | 5,954 | — | ||||||
Deferred revenue | 49,286 | 39,846 | ||||||
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Total current liabilities | 85,240 | 61,540 | ||||||
Operating lease liability, net of current portion | 10,467 | — | ||||||
Other liabilities | 890 | 1,202 | ||||||
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Total liabilities | 96,597 | 62,742 | ||||||
Commitments and contingencies(Note 11) | ||||||||
Stockholders’ equity: | ||||||||
Undesignated preferred stock, $0.001 par value; 5,000,000 shares authorized; no shares issued | — | — | ||||||
Common stock, $0.001 par value; 100,000,000 shares authorized; 38,922,488 and 36,752,469 shares issued at September 30, 2019 and December 31, 2018, respectively | 39 | 37 | ||||||
Additionalpaid-in capital | 271,293 | 251,122 | ||||||
Treasury stock, at cost; 135,000 shares | (871 | ) | (871 | ) | ||||
Accumulated other comprehensive loss | (1,026 | ) | (952 | ) | ||||
Accumulated deficit | (193,913 | ) | (178,722 | ) | ||||
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Total stockholders’ equity | 75,522 | 70,614 | ||||||
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Total liabilities and stockholders’ equity | $ | 172,119 | $ | 133,356 | ||||
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The accompanying notes are an integral partTable of these condensed consolidated financial statements.
Brightcove Inc.
Condensed Consolidated Statements of Operations
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||
Revenue: | ||||||||||||||||
Subscription and support revenue | $ | 45,424 | $ | 37,442 | $ | 129,192 | $ | 113,176 | ||||||||
Professional services and other revenue | 2,010 | 3,679 | 7,660 | 10,793 | ||||||||||||
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Total revenue | 47,434 | 41,121 | 136,852 | 123,969 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of subscription and support revenue | 16,686 | 13,142 | 50,237 | 39,723 | ||||||||||||
Cost of professional services and other revenue | 1,628 | 3,176 | 6,432 | 10,424 | ||||||||||||
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Total cost of revenue | 18,314 | 16,318 | 56,669 | 50,147 | ||||||||||||
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Gross profit | 29,120 | 24,803 | 80,183 | 73,822 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 8,127 | 8,314 | 23,150 | 23,832 | ||||||||||||
Sales and marketing | 14,567 | 14,009 | 45,650 | 42,508 | ||||||||||||
General and administrative | 6,245 | 5,621 | 17,485 | 18,056 | ||||||||||||
Merger-related | 2,539 | — | 8,091 | — | ||||||||||||
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Total operating expenses | 31,478 | 27,944 | 94,376 | 84,396 | ||||||||||||
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Loss from operations | (2,358 | ) | (3,141 | ) | (14,193 | ) | (10,574 | ) | ||||||||
Other expense, net | (441 | ) | (217 | ) | (477 | ) | (427 | ) | ||||||||
Loss before income taxes | (2,799 | ) | (3,358 | ) | (14,670 | ) | (11,001 | ) | ||||||||
Provision for income taxes | 171 | 144 | 521 | 410 | ||||||||||||
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Net loss | $ | (2,970 | ) | $ | (3,502 | ) | $ | (15,191 | ) | $ | (11,411 | ) | ||||
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Net loss per share - basic and diluted | $ | (0.08 | ) | $ | (0.10 | ) | $ | (0.40 | ) | $ | (0.32 | ) | ||||
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Weighted-average number of common shares used in computing | 38,564,314 | 36,212,246 | 37,738,739 | 35,564,311 | ||||||||||||
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The accompanying notes are an integral part of these condensed consolidated financial statements.
Brightcove Inc.
Condensed Consolidated Statements of Comprehensive Loss
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(in thousands) | ||||||||||||||||
Net loss | $ | (2,970 | ) | $ | (3,502 | ) | $ | (15,191 | ) | $ | (11,411 | ) | ||||
Other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustments | (134 | ) | (116 | ) | (74 | ) | (189 | ) | ||||||||
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Comprehensive loss | $ | (3,104 | ) | $ | (3,618 | ) | $ | (15,265 | ) | $ | (11,600 | ) | ||||
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The accompanying notes are an integral part of these condensed consolidated financial statements.
Brightcove Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(unaudited)
(in thousands, except share data)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(in thousands, except share data) | ||||||||||||||||
Shares of common stock issued | ||||||||||||||||
Balance, beginning of period | 38,219,843 | 36,052,891 | 36,752,469 | 34,933,408 | ||||||||||||
Common stock issued upon acquisition | 230,083 | — | 1,286,846 | — | ||||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | 472,562 | 550,609 | 883,173 | 1,670,092 | ||||||||||||
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Balance, end of period | 38,922,488 | 36,603,500 | 38,922,488 | 36,603,500 | ||||||||||||
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Shares of treasury stock | ||||||||||||||||
Balance, beginning of period | (135,000 | ) | (135,000 | ) | (135,000 | ) | (135,000 | ) | ||||||||
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Balance, end of period | (135,000 | ) | (135,000 | ) | (135,000 | ) | (135,000 | ) | ||||||||
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Par value of common stock issued | ||||||||||||||||
Balance, beginning of period | $ | 38 | $ | 36 | $ | 37 | $ | 35 | ||||||||
Common stock issued upon acquisition | — | — | 1 | — | ||||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | 1 | 1 | 1 | 2 | ||||||||||||
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Balance, end of period | $ | 39 | $ | 37 | $ | 39 | $ | 37 | ||||||||
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Value of treasury stock | ||||||||||||||||
Balance, beginning of period | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | ||||
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Balance, end of period | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | ||||
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Additionalpaid-in capital | ||||||||||||||||
Balance, beginning of period | $ | 264,765 | $ | 246,417 | $ | 251,122 | $ | 238,700 | ||||||||
Common stock issued upon acquisition | 3,383 | — | 12,249 | — | ||||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | 1,372 | 1,219 | 3,215 | 5,439 | ||||||||||||
Withholding tax on restricted stock units vesting | (32 | ) | (29 | ) | (32 | ) | (142 | ) | ||||||||
Stock-based compensation expense | 1,805 | 1,569 | 4,739 | 5,179 | ||||||||||||
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Balance, end of period | $ | 271,293 | $ | 249,176 | $ | 271,293 | $ | 249,176 | ||||||||
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Accumulated deficit | ||||||||||||||||
Balance, beginning of period | $ | (190,943 | ) | $ | (172,603 | ) | $ | (178,722 | ) | $ | (170,299 | ) | ||||
Net loss | (2,970 | ) | (3,502 | ) | (15,191 | ) | (11,411 | ) | ||||||||
Impact of adoption of ASU2014-09 as of January 1, 2018 | — | — | — | 5,605 | ||||||||||||
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Balance, end of period | $ | (193,913 | ) | $ | (176,105 | ) | $ | (193,913 | ) | $ | (176,105 | ) | ||||
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Accumulated other comprehensive loss | ||||||||||||||||
Balance, beginning of period | $ | (892 | ) | $ | (882 | ) | $ | (952 | ) | $ | (809 | ) | ||||
Foreign currency translation adjustment | (134 | ) | (116 | ) | (74 | ) | (189 | ) | ||||||||
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Balance, end of period | $ | (1,026 | ) | $ | (998 | ) | $ | (1,026 | ) | $ | (998 | ) | ||||
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Total stockholders’ equity | $ | 75,522 | $ | 71,239 | $ | 75,522 | $ | 71,239 | ||||||||
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The accompanying notes are an integral part of these condensed consolidated financial statements.
Brightcove Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
(in thousands) | ||||||||
Operating activities | ||||||||
Net loss | $ | (15,191 | ) | $ | (11,411 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization | 6,150 | 5,164 | ||||||
Stock-based compensation | 4,504 | 5,022 | ||||||
Provision for reserves on accounts receivable | 559 | 99 | ||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | (5,477 | ) | 1,998 | |||||
Prepaid expenses and other current assets | 642 | (118 | ) | |||||
Other assets | (503 | ) | (355 | ) | ||||
Accounts payable | 2,635 | (1,262 | ) | |||||
Accrued expenses | 4,510 | 1,964 | ||||||
Operating leases | (261 | ) | — | |||||
Deferred revenue | 3,061 | (1,335 | ) | |||||
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Net cash provided by (used in) operating activities | 629 | (234 | ) | |||||
Investing activities | ||||||||
Cash paid for acquisition, net of cash acquired | (5,402 | ) | — | |||||
Purchases of property and equipment | (600 | ) | (1,322 | ) | ||||
Capitalizedinternal-use software costs | (4,264 | ) | (2,527 | ) | ||||
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Net cash used in investing activities | (10,266 | ) | (3,849 | ) | ||||
Financing activities | ||||||||
Proceeds from exercise of stock options | 3,215 | 5,440 | ||||||
Other financing activities | (208 | ) | (428 | ) | ||||
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Net cash provided by financing activities | 3,007 | 5,012 | ||||||
Effect of exchange rate changes on cash and cash equivalents | (27 | ) | (206 | ) | ||||
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Net (decrease) increase in cash and cash equivalents | (6,657 | ) | 723 | |||||
Cash and cash equivalents at beginning of period | 29,306 | 26,132 | ||||||
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Cash and cash equivalents at end of period | $ | 22,649 | $ | 26,855 | ||||
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Supplemental disclosure of cash flow information | ||||||||
Cash paid for operating lease liabilities | $ | 1,829 | $ | — | ||||
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Supplemental disclosure ofnon-cash investing activities | ||||||||
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Fair value of shares issued for acquisition of a business | $ | 12,250 | $ | — | ||||
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The accompanying notes are an integral part of these condensed consolidated financial statements.
Brightcove Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
(in thousands, except share and per share data, unless otherwise noted)
1. Business Description and Basis of Presentation
Business Description
Brightcove Inc. (the Company) is a leading global provider of cloud services for video which enable its customers to publish and distribute video to Internet-connected devices quickly, easily and in a cost-effective and high-quality manner.
The Company is headquartered in Boston, Massachusetts and was incorporated in the state of Delaware on August 24, 2004.
Basis of Presentation
The accompanying interim condensed consolidated financial statements are unaudited. These condensed consolidated financial statements and notes should be read in conjunction with the audited consolidated financial statements and related notes, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in the Company’s Annual Report on Form10-K for the year ended December 31, 2018.
The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, other than the changes to accounting for leases as described in Note 14, the unaudited condensed consolidated financial statements and notes have been prepared on the same basis as the audited consolidated financial statements for the year ended December 31, 2018 contained in the Company’s Annual Report on Form10-K and include all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position for the three and nine months ended September 30, 2019 and 2018. These interim periods are not necessarily indicative of the results to be expected for any other interim period or the full year.
The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than those disclosed in this Report on Form10-Q.
The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the condensed consolidated financial statements. As described in footnote 14, the Company implemented a significant accounting policy upon the adoption of AccountingStandards Update (“ASU”) 2016-02, Leases (Topic 842), Amendments to the FASB Accounting Standards Codification (“ASC 842”). As of September 30, 2019, other than the changes to the accounting for leases, the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form10-K for the year ended December 31, 2018, have not changed.
2. Business Combinations
Ooyala
On April 1, 2019, pursuant to an Asset Purchase and Sale Agreement (the “Purchase Agreement”), the Company completed its acquisition of the online video platform assets of Ooyala, Inc. and certain of its subsidiaries (“Ooyala”), a provider of cloud video technology, in exchange for common stock of the Company and cash (the “Ooyala Acquisition”). At the closing, the Company issued 1,056,763 unregistered shares of common stock of the Company valued at $8.9 million and paid $2.6 million in cash Pursuant to the Purchase Agreement, approximately $2.65 million of the cash consideration was placed into an escrow account to secure payment of any claims of indemnification for breaches or inaccuracies in the Sellers’ representations and warranties, covenants and agreements.
The Ooyala Acquisition was accounted for using the purchase method of accounting in accordance with Accounting Standards Codification 805 — Business Combinations. Accordingly, the results of operations of Ooyala have been included in the accompanying condensed consolidated financial statements since the date of acquisition. The purchase price has been allocated to the tangible and intangible assets acquired and liabilities assumed based upon the respective estimates of fair value as of the date of the Ooyala Acquisition, which remain preliminary as of September 30, 2019, and using assumptions that the Company’s management believes are
reasonable given the information currently available. The Company is in the process of completing its valuation of its intangible assets, accounts receivable, deferred revenue and the valuation of the acquired deferred tax assets and liabilities. The final allocations of the purchase price to intangible assets, accounts receivable, deferred revenue, goodwill and any deferred tax assets and liabilities may differ materially from the information presented in these unaudited condensed consolidated financial statements.
The process for estimating the fair values of identifiable intangible assets and certain tangible assets requires the use of significant estimates and assumptions, including estimating future cash flows and developing appropriate discount rates. Definitive allocations are being performed and finalized based on certain valuations and other studies performed by the Company with the services of valuation professionals.
During the three and nine months ended September 30, 2019, the Company incurred $2.0 million and $7.6 million, respectively, of merger-related costs related to the Ooyala Acquisition.
The excess of the purchase price over the estimated amounts of net assets as of the effective date of the acquisition was allocated to goodwill in accordance with the accounting guidance. The factors contributing to the recognition of the amount of goodwill are based on several strategic and synergistic benefits that are expected to be realized from the Ooyala Acquisition. These benefits include the acquired workforce and with the Company’s direct sales force and larger channel coverage, the Company anticipates significant cross-selling opportunities. The goodwill is expected to be deductible for tax purposes.
The total purchase price for Ooyala has been allocated as follows:
Accounts receivable | $ | 2,904 | ||
Other tangible assets | 620 | |||
Identifiable intangible assets | 9,765 | |||
Goodwill | 4,762 | |||
Deferred revenue | (6,425 | ) | ||
Other liabilities | (196 | ) | ||
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Total estimated purchase price | $ | 11,430 | ||
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The following are the identifiable intangible assets acquired and their respective useful lives, as determined based on preliminary valuations:
Amount | Useful Life | |||||||
Customer relationships | $ | 9,127 | 7 | |||||
Developed technology | 638 | 1 | ||||||
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Total | $ | 9,765 | ||||||
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The preliminary fair value of the intangible assets has been estimated using the income approach in which theafter-tax cash flows are discounted to present value. The cash flows are based on estimates used to price the transaction, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital.
The estimated amortization expense for 2019 and for each of the five succeeding years and thereafter is as follows:
Year Ending December 31, | Amount | |||
2019 | $ | 1,456 | ||
2020 | 1,463 | |||
2021 | 1,304 | |||
2022 | 1,304 | |||
2023 | 1,304 | |||
2024 and thereafter | 2,934 | |||
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Total | $ | 9,765 | ||
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Pro Forma Financial Information
The unaudited financial information in the table below summarizes the combined results of operations of the Company and Ooyala, on a pro forma basis, as though the Company had acquired Ooyala at the beginning of the periods presented. The pro forma information for all periods presented also includes the effects of business combination accounting resulting from the acquisition.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
2018 | 2019 | 2018 | ||||||||||
Total revenue | $ | 48,736 | $ | 144,467 | $ | 146,814 | ||||||
Net loss | (4,215 | ) | (13,904 | ) | (12,151 | ) | ||||||
Earnings per share - basic and diluted | (0.11 | ) | (0.37 | ) | (0.33 | ) |
Revenue from the Ooyala Acquisition for the three and nine months ended September 30, 2019 was $5.9 million and $12.1 million, respectively. Net income from the Ooyala Acquisition for the three and nine months ended September 30, 2019 was $1.1 million and $1.4 million, respectively.
Other Business Combinations
On August 1, 2019, pursuant to a Share Purchase Agreement (the “SPA”), the Company completed its acquisition of a company and its subsidiary (the “August Acquisition”) in exchange for common stock of the Company and cash. Consideration was comprised of: (a) 270,686 unregistered shares of common stock of the Company valued at $3.4 million, of which 40,603 were held back to secure payment of any claims of indemnification for breaches or inaccuracies in the sellers’ representations and warranties, covenants and agreements, (b) approximately $3.3 million in cash, of which $488 was held back to secure payment of any claims of indemnification for breaches or inaccuracies in the Sellers’ representations and warranties, covenants and agreements, and (c) approximately $1 million in cash for cash acquired as part of the transaction.
The August Acquisition was accounted for using the purchase method of accounting in accordance with Accounting Standards Codification 805 — Business Combinations. Accordingly, the results of operations of the acquired company have been included in the accompanying condensed consolidated financial statements since the date of acquisition. The purchase price has been allocated to the tangible and intangible assets acquired and liabilities assumed based upon the respective estimates of fair value as of the date of the August Acquisition, which remain preliminary as of September 30, 2019, and using assumptions that the Company’s management believes are reasonable given the information currently available. The Company is in the process of completing its valuation of its intangible assets, accounts receivable, deferred revenue and the valuation of the acquired deferred tax assets and liabilities. The final allocations of the purchase price to intangible assets, accounts receivable, deferred revenue, goodwill and any deferred tax assets and liabilities may differ materially from the information presented in these unaudited condensed consolidated financial statements. Additionally, the Company is in the process of evaluating the accounting of the deferred consideration for the amounts held back for security against indemnification, as well as standard representations and warranties made by the seller.
During the three and nine months ended September 30, 2019, the Company incurred $500 of merger-related costs related to the August Acquisition.
The excess of the purchase price over the estimated amounts of net assets as of the effective date of the acquisition was allocated to goodwill in accordance with the accounting guidance. The factors contributing to the recognition of the amount of goodwill are based on several strategic and synergistic benefits that are expected to be realized from the August Acquisition. These benefits include the acquired workforce and opportunities to expand the Company’s offerings in target market segments. The goodwill is expected to benon-deductible for tax purposes.
The total purchase price for the August Acquisition has been allocated as follows:
Cash | $ | 981 | ||
Accounts receivable | 393 | |||
Other tangible assets | 210 | |||
Identifiable intangible assets | 1,525 | |||
Goodwill | 5,472 | |||
Accounts payable | (177 | ) | ||
Deferred revenue | (138 | ) | ||
Accrued expenses | (322 | ) | ||
Deferred tax liability | (264 | ) | ||
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Total estimated purchase price | $ | 7,680 | ||
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The following are the identifiable intangible assets acquired and their respective useful lives, as determined based on preliminary valuations:
Amount | Useful Life | |||||||
Developed technology | $ | 232 | 4 | |||||
Customer relationships | 1,293 | 4 | ||||||
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Total | $ | 1,525 | ||||||
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The preliminary fair value of the intangible assets has been estimated using the income approach in which theafter-tax cash flows are discounted to present value. The cash flows are based on estimates used to price the transaction, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital.
The estimated remaining amortization expense for 2019 and for each of the five succeeding years and thereafter is as follows:
Year Ending December 31, | Amount | |||
2019 | $ | 160 | ||
2020 | 381 | |||
2021 | 381 | |||
2022 | 381 | |||
2023 | 222 | |||
2024 and thereafter | — | |||
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Total | $ | 1,525 | ||
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Pro forma results of operations for the August Acquisition have not been presented because the effect of the acquisition is not material to the Company’s consolidated financial results. Revenue and earnings attributable to acquired operations since the date of the acquisition are included in the Company’s consolidated statements of operations.
The changes in the carrying amount of goodwill for the nine months ended September 30, 2019 were as follows:
Balance as of January 1, 2019 | $ | 50,776 | ||
Goodwill from acquisitions | 10,234 | |||
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Balance as of September 30, 2019 | $ | 61,010 | ||
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3. Revenue from Contracts with Customers
The Company primarily derives revenue from the sale of its online video platform, which enables its customers to publish and distribute video to Internet-connected devices quickly, easily and in a cost-effective and high-quality manner. Revenue is derived from three primary sources: (1) the subscription to its technology and related support; (2) hosting, bandwidth and encoding services; and (3) professional services, which includeinitiation, set-up and customization services.
The following summarizes the opening and closing balances of receivables, contract assets and contract liabilities from contracts with customers.
Accounts Receivable, net | Contract Assets (current) | Deferred Revenue (current) | Deferred Revenue (non-current) | Total Deferred Revenue | ||||||||||||||||
Balance at December 31, 2018 | $ | 23,264 | $ | 1,640 | $ | 39,846 | $ | 146 | $ | 39,992 | ||||||||||
Balance at September 30, 2019 | 31,485 | 1,786 | 49,286 | 428 | 49,714 |
Revenue recognized during the three and nine months ended September 30, 2019 from amounts included in deferred revenue at the beginning of the period was approximately $6.4 million and $37.6 million, respectively. During the three and nine months ended September 30, 2019, the Company did not recognize a material amount of revenue from performance obligations satisfied or partially satisfied in previous periods.
The assets recognized for costs to obtain a contract were $5.7 million as of September 30, 2019 and $5.9 million as of December 31, 2018. Amortization expense recognized during the three and nine months ended September 30, 2019 related to costs to obtain a contract was $1.8 million and $5.5 million, respectively. Amortization expense recognized during the three and nine months ended September 30, 2018 related to costs to obtain a contract was $1.9 million and $5.7 million, respectively.
Transaction Price Allocated to Future Performance Obligations
As of September 30, 2019, the total aggregate transaction price allocated to the unsatisfied performance obligations for subscription and support contracts was approximately $125.7 million, of which approximately $100.6 million is expected to be recognized over the next 12 months. The Company expects to recognize substantially all of the remaining unsatisfied performance obligations by December 2022.
4. Concentration of Credit Risk
The Company has nosignificant off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents and trade accounts receivable. The Company maintains its cash and cash equivalents principally with accredited financial institutions of high credit standing. Although the Company deposits its cash with multiple financial institutions, its deposits, at times, may exceed federally insured limits. The Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. The Company does not require collateral. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company’s accounts receivable.
At September 30, 2019 and December 31, 2018, no individual customer accounted for 10% or more of accounts receivable, net. For the three and nine months ended September 30, 2019 and 2018, no individual customer accounted for 10% or more of total revenue.
5. Concentration of Other Risks
The Company is dependent on certain content delivery network providers who provide digital media delivery functionality enabling theCompany’s on-demand application service to function as intended for the Company’s customers andultimate end-users. The disruption of these services could have a material adverse effect on the Company’s business, financial position, and results of operations.
6. Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. Management determines the appropriate classification of investments at the time of purchase,and re-evaluates such determination at each balance sheet date. The Company did not have any short-term or long-term investments at September 30, 2019 or December 31, 2018.
Cash and cash equivalents primarily consist of cash on deposit with banks and amounts held in interest-bearing money market accounts. Cash equivalents are carried at cost, which approximates their fair market value.
Cash and cash equivalents as of September 30, 2019 consist of the following:
September 30, 2019 | ||||||||||||||||
Description | Contracted Maturity | Cost | Fair Market Value | Balance Per Balance Sheet | ||||||||||||
Cash | Demand | $ | 22,608 | $ | 22,608 | $ | 22,608 | |||||||||
Money market funds | Demand | 41 | 41 | 41 | ||||||||||||
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Total cash and cash equivalents | $ | 22,649 | $ | 22,649 | $ | 22,649 | ||||||||||
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Cash and cash equivalents as of December 31, 2018 consist of the following:
December 31, 2018 | ||||||||||||||||
Description | Contracted Maturity | Cost | Fair Market Value | Balance Per Balance Sheet | ||||||||||||
Cash | Demand | $ | 21,007 | $ | 21,007 | $ | 21,007 | |||||||||
Money market funds | Demand | 8,299 | 8,299 | 8,299 | ||||||||||||
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Total cash and cash equivalents | $ | 29,306 | $ | 29,306 | $ | 29,306 | ||||||||||
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7. Net Loss per Share
The Company calculates basic and diluted net loss per common share by dividing the net loss by the number of common shares outstanding during the period. The Company has excluded other potentially dilutive shares, which include warrants to purchase common stock and outstanding common stock options and unvested restricted stock units, from the number of common shares outstanding as their inclusion in the computation for all periods would be anti-dilutive due to net losses incurred. The following outstanding common shares have been excluded from the computation of dilutive net loss per share as of September 30, 2019 and 2018 (in thousands).
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Options outstanding | 2,522 | 3,079 | 2,522 | 3,079 | ||||||||||||
Restricted stock units outstanding | 3,244 | 2,477 | 3,244 | 2,477 |
8. Fair Value of Financial Instruments
The following tables set forth the Company’s financial instruments carried at fair value using the lowest level of input as of September 30, 2019 and December 31, 2018:
September 30, 2019 | ||||||||||||||||
Quoted Prices in Active Markets for Identical Items (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
Assets: | ||||||||||||||||
Money market funds | $ | 41 | $ | — | $ | — | $ | 41 | ||||||||
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Total assets | $ | 41 | $ | — | $ | — | $ | 41 | ||||||||
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December 31, 2018 | ||||||||||||||||
Quoted Prices in Active Markets for Identical Items (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
Assets: | ||||||||||||||||
Money market funds | $ | 8,299 | $ | — | $ | — | $ | 8,299 | ||||||||
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Total assets | $ | 8,299 | $ | — | $ | — | $ | 8,299 | ||||||||
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9. Stock-based Compensation
The weighted-average fair value of options granted during the three months ended September 30, 2019 and 2018 was $5.21 and $3.89 per share, respectively. The weighted-average fair value of options granted during the nine months ended September 30, 2019 and 2018 was $4.54 and $4.16 per share, respectively. The weighted-average assumptions utilized to determine such values are presented in the following table:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Expected life in years | 6.2 | 6.3 | 6.2 | 6.2 | ||||||||||||
Risk-free interest rate | 1.85 | % | 2.92 | % | 2.30 | % | 2.88 | % | ||||||||
Volatility | 44 | % | 42 | % | 44 | % | 43 | % | ||||||||
Dividend yield | — | — | — | — |
The Company recorded stock-based compensation expense of $1.7 million and $1.5 million for the three months ended September 30, 2019 and 2018, respectively. The Company recorded stock-based compensation expense of $4.5 million and $5.0 million for the nine months ended September 30, 2019 and 2018, respectively. As of September 30, 2019, there was $21 million of unrecognized stock-based compensation expense related to stock-based awards that is expected to be recognized over a weighted-average period of 2.76 years. The following table summarizes stock-based compensation expense as included in the consolidated statement of operations for the three and nine months ended September 30, 2019 and 2018:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Stock-based compensation: | ||||||||||||||||
Cost of subscription and support revenue | $ | 127 | $ | 140 | $ | 341 | $ | 373 | ||||||||
Cost of professional services and other revenue | 71 | 69 | 223 | 155 | ||||||||||||
Research and development | 323 | 283 | 855 | 932 | ||||||||||||
Sales and marketing | 602 | 437 | 1,411 | 1,885 | ||||||||||||
General and administrative | 598 | 593 | 1,674 | 1,677 | ||||||||||||
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$ | 1,721 | $ | 1,522 | $ | 4,504 | $ | 5,022 | |||||||||
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The following is a summary of the stock option activity during the nine months ended September 30, 2019.
Number of Shares | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value (1) | |||||||||||||
Outstanding at December 31, 2018 | 2,737,655 | $ | 8.57 | |||||||||||||
Granted | 692,038 | 10.00 | ||||||||||||||
Exercised | (427,429 | ) | 7.52 | $ | 1,155 | |||||||||||
Canceled | (479,918 | ) | 9.42 | |||||||||||||
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Outstanding at September 30, 2019 | 2,522,346 | $ | 8.98 | 7.34 | $ | 4,224 | ||||||||||
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Exercisable at September 30, 2019 | 1,113,395 | $ | 8.36 | 5.40 | $ | 2,622 | ||||||||||
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The following table summarizes the restricted stock unit activity during the nine months ended September 30, 2019:
Shares | Weighted Average Grant Date Fair Value | |||||||
Unvested at December 31, 2018 | 3,033,582 | $ | 8.07 | |||||
Granted | 1,388,172 | 11.03 | ||||||
Vested and issued | (455,744 | ) | 8.03 | |||||
Canceled | (721,827 | ) | 8.08 | |||||
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Unvested at September 30, 2019 | 3,244,183 | $ | 9.07 | |||||
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10. Income Taxes
For the three months ended September 30, 2019 and 2018, the Company recorded income tax expense of $171 and $144, respectively. For the nine months ended September 30, 2019 and 2018, the Company recorded income tax expense of $521 and $410, respectively. The income tax expense relates principally to the Company’s foreign operations.
The Company is required to compute income tax expense in each jurisdiction in which it operates. This process requires the Company to project its current tax liability and estimate its deferred tax assets and liabilities, including net operating loss (“NOL”) and tax credit carry-forwards. In assessing the ability to realize the net deferred tax assets, management considers whether it is more likely than not that some portion or all of the net deferred tax assets will not be realized.
The Company has provided a valuation allowance against its remaining U.S. net deferred tax assets as of September 30, 2019 and December 31, 2018, based upon the level of historical U.S. losses and future projections over the period in which the net deferred tax assets are deductible, at this time, management believes it is more likely than not that the Company will not realize the benefits of these deductible differences. The Company maintains net deferred tax liabilities for temporary differences related to its foreign subsidiaries.
11. Commitments and Contingencies
Legal Matters
On January 30, 2019, Uniloc 2017 LLC (“Uniloc”) filed a complaint against the Company and its subsidiary, Brightcove Holdings, Inc. in the United States District Court for the District of Delaware. The complaint alleges that the Company infringed four patents and seeks monetary damages and other relief. The Company answered the complaint on March 25, 2019 and Uniloc filed an amended complaint on April 9, 2019. The Company filed an answer to the amended complaint on April 23, 2019. The Company cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can the Company reasonably estimate the potential loss, if any.
On or about June 24, 2019, Dynamic Data Technologies, LLC (“DDT”) filed a complaint against the Company and its subsidiary, Brightcove Holdings, Inc., in the United States District Court for the District of Delaware. The complaint alleges that the Company infringed patents owned by DDT and seeks monetary damages and other relief. The Company filed a motion to dismiss the complaint and that motion is pending review by the court. The Company cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can the Company reasonably estimate the potential loss, if any.
The Company, from time to time, is party to litigation arising in the ordinary course of business. Management does not believe that the outcome of these claims will have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company based on the status of proceedings at this time.
Guarantees and Indemnification Obligations
The Company typically enters into indemnification agreements in the ordinary course of business. Pursuant to these agreements, the Company indemnifies and agrees to reimburse the indemnified party for losses and costs incurred by the indemnified party, generally the Company’s customers, in connection with patent, copyright, trade secret, or other intellectual property or personal right infringement claims by third parties with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual after execution of the agreement. Based on when customers first subscribe for the Company’s service, the maximum potential amount of future payments the Company could be required to make under certain of these indemnification agreements is unlimited, however, more recently the Company has typically limited the maximum potential value of such potential future payments in relation to the value of the contract. Based on historical experience and information known as of September 30, 2019, the Company has not incurred any costs for the above guarantees and indemnities. The Company has received requests for indemnification from customers in connection with patent infringement suits brought against the customer by a third party. To date, the Company has not agreed that the requested indemnification is required by the Company’s contract with any such customer.
In certain circumstances, the Company warrants that its products and services will perform in all material respects in accordance with its standard published specification documentation in effect at the time of delivery of the licensed products and services to the customer for the warranty period of the product or service. To date, the Company has not incurred significant expense under its warranties and, as a result, the Company believes the estimated fair value of these agreements is immaterial.
12. Debt
On December 14, 2018, the Company entered into an amended and restated loan and security agreement with a lender (the “Loan Agreement”) providing for up to a $30.0 million asset based line of credit (the “Line of Credit”). Under the Line of Credit, the Company can borrow up to $30.0 million. Borrowings under the Line of Credit are secured by substantially all of the Company’s assets, excluding its intellectual property. Outstanding amounts under the Line of Credit accrue interest at a rate as follows: (i) for prime rate advances, the greater of (A) the prime rate and (B) 4%, and (ii) for LIBOR advances, the greater of (A) the LIBOR rate plus 225 basis points and (B) 4%. Under the Loan Agreement, the Company must comply with certain financial covenants, including maintaining a minimum asset coverage ratio. If the outstanding principal during any month is at least $15.0 million, the Company must also maintain a minimum net income thresholdbased on non-GAAP operating measures. Failure to comply with these covenants, or the occurrence of an event of default, could permit the lenders under the Line of Credit to declare all amounts borrowed under the Line of Credit, together with accrued interest and fees, to be immediately due and payable. The Company was in compliance with all covenants under the Line of Credit as of September 30, 2019 and there are no borrowings outstanding as of September 30, 2019.
13. Segment Information
Geographic Data
Total revenue from unaffiliated customers by geographic area, based on the location of the customer, was as follows:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenue: | ||||||||||||||||
North America | $ | 24,904 | $ | 21,834 | $ | 72,425 | $ | 67,351 | ||||||||
Europe | 8,178 | 7,491 | 22,814 | 20,538 | ||||||||||||
Japan | 5,391 | 5,464 | 16,725 | 16,319 | ||||||||||||
Asia Pacific | 8,646 | 6,125 | 24,009 | 19,292 | ||||||||||||
Other | 315 | 207 | 879 | 469 | ||||||||||||
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Total revenue | $ | 47,434 | $ | 41,121 | $ | 136,852 | $ | 123,969 | ||||||||
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North America is comprised of revenue from the United States, Canada and Mexico. Revenue from customers located in the United States was $23,162 and $20,521 during the three months ended September 30, 2019 and 2018, respectively. Revenue from customers located in the United States was $67,534 and $63,345 during the nine months ended September 30, 2019 and 2018, respectively. Other than the United States and Japan, no other country contributed more than 10% of the Company’s total revenue during the three and nine months ended September 30, 2019 and 2018.
As of September 30, 2019 and December 31, 2018, property and equipment at locations outside the U.S. was not material.
14. Recently Issued and Adopted Accounting Standards
Effective January 1, 2019, the Company adopted ASC 842, which replaced the existing guidance for leases using the transition method introducedby ASU 2018-11, which adjusts the January 1, 2019 balance for the cumulative effects of the change in accounting.
Under ASC 842, aright-of-use asset and lease liability is recorded for all leases and the statement of operations reflects the lease expense for operating leases and amortization/interest expense for financing leases. The balance sheet amount recorded for existing leases at the date of adoption of ASC 842 is calculated using the applicable incremental borrowing rate at the date of adoption. The adoption of the new standard resulted in the recording ofright-of-use assets and lease liabilities of $19.6 million and $20.9 million, respectively, as of January 1, 2019. Additionally, the Company reversed its deferred rent liability of $1.3 million as a result of the adoption. The adoption of the lease standard did not result in a cumulativecatch-up adjustment to the opening balance of retained earnings.
The new standard provided various practical expedients, which were assessed to determine the ultimate impact of the new standard upon adoption. The Company elected the package of practical expedients, which permits the Company to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases and (3) any initial direct costs for any existing leases as of the effective date. The Company also elected the practical expedients to not apply the recognition requirements in the standard to a lease that at commencement date has a lease term of twelve months or less and does not contain a purchase option that it is reasonably certain to exercise and to not separate lease and relatednon-lease components.
The Company leases its facilities undernon-cancelable operating leases.Right-of-use assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease.Right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the
lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Many of the Company’s lessee agreements include options to extend the lease, which are not included in the minimum lease terms unless they are reasonably certain to be exercised.
The Company’s operating lease expense was $2 million and $5.8 million for the three and nine months ended September 30, 2019. The Company’s operating lease expense was $1.9 million and $5.9 million for the three and nine months ended September 30, 2018, respectively.
During the second quarter of 2019, the Company entered into a new lease in its Singapore location with a lease liability of $779.
The weighted-average remainingnon-cancelable lease term for our operating leases was three years at September 30, 2019. The weighted-average discount rate was 4.0% at September 30, 2019.
The Company’s operating leases expire at various dates through 2024. The following shows the undiscounted cash flows for the remainder of 2019 and remaining years under operating leases at September 30, 2019:
Year Ending December 31, | Operating Lease Commitments | |||
2019 | $ | 1,746 | ||
2020 | 6,072 | |||
2021 | 5,349 | |||
2022 | 2,262 | |||
2023 | 1,069 | |||
2024 and thereafter | 954 | |||
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$ | 17,452 | |||
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15. Restructuring
During the second quarter of 2019, the Company committed to an action to restructure certain parts of the Company with the intent of aligning skills with the Company’s strategy and facilitating cost efficiencies and savings. As a result, certain headcount reductions were necessary. The Company incurred approximately $752 in restructuring charges during the second quarter of 2019. The restructuring charges reflect post-employment benefits and are reflected in theCondensed Consolidated Statements of Operationsas follows: $186 – Cost of subscription and support revenue; $107 - Cost of professional services and other revenue; $421 – Sales and Marketing; and $38 – Research and Development. The Company has paid all amounts due relating to the restructuring and does not expect to incur any additional restructuring charges related to this action.
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The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form10-Q and our Annual Report on Form10-K for the year ended December 31, 2018.
Forward-Looking Statements
This Quarterly Report on FormIII of this Quarterly Report on Form our Annual Report on Form10-K for the year ended December 31, 2018
Forward-looking statements in this Quarterly Report on Form
• | our ability to achieve profitability; |
• | our competitive position and the effect of competition in our industry; |
• | our ability to retain and attract new customers; |
• | our ability to penetrate existing markets and develop new markets for our services; |
• | our ability to retain or hire qualified accounting and other personnel; |
• | our ability to successfully integrate acquired businesses, including the online video platform assets of Ooyala, Inc. and certain of its subsidiaries that we acquired during 2019; |
• | our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others; |
• | our ability to maintain the security and reliability of our systems; |
• | our estimates with regard to our future performance and total potential market opportunity; |
• | our expectations regarding the potential impact of the COVID-19 pandemic on our business, operations, and the markets in which we and our partners and customers operate; |
• | our estimates regarding our anticipated results of operations, future revenue, bookings growth, capital requirements and our needs for additional financing; and |
• | our goals and strategies, including those related to revenue and bookings growth. |
ITEM 1. | FINANCIAL STATEMENTS |
June 30, 2020 | December 31, 2019 | |||||||
(in thousands, except share and per share data) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 27,753 | $ | 22,759 | ||||
Accounts receivable, net of allowance of $651 and $904 at June 30, 2020 and December 31, 2019, respectively | 26,794 | 31,181 | ||||||
Prepaid expenses | 8,986 | 5,171 | ||||||
Other current assets | 8,340 | 6,713 | ||||||
Total current assets | 71,873 | 65,824 | ||||||
Property and equipment, net | 14,726 | 12,086 | ||||||
Operating lease right-of-use asset | 13,340 | 16,912 | ||||||
Intangible assets, net | 12,090 | 13,875 | ||||||
Goodwill | 60,902 | 60,902 | ||||||
Other assets | 3,524 | 3,268 | ||||||
Total assets | $ | 176,455 | $ | 172,867 | ||||
Liabilities and stockholders’ equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 11,283 | $ | 9,917 | ||||
Accrued expenses | 20,556 | 20,925 | ||||||
Operating lease liability | 5,687 | 6,174 | ||||||
Deferred revenue | 54,647 | 49,260 | ||||||
Total current liabilities | 92,173 | 86,276 | ||||||
Operating lease liability, net of current portion | 8,618 | 11,701 | ||||||
Debt | 5,000 | — | ||||||
Other liabilities | 1,100 | 767 | ||||||
Total liabilities | 106,891 | 98,744 | ||||||
Commitments and contingencies (Note 10) | ||||||||
Stockholders’ equity: | ||||||||
Undesignated preferred stock, $0.001 par value; 5,000,000 shares authorized; 0 shares issued | — | — | ||||||
Common stock, $0.001 par value; 100,000,000 shares authorized; 39,543,991 and 39,042,787 shares issued at June 30, 2020 and December 31, 2019, respectively | 39 | 39 | ||||||
Additional paid-in capital | 281,255 | 276,365 | ||||||
Treasury stock, at cost; 135,000 shares | (871 | ) | (871 | ) | ||||
Accumulated other comprehensive loss | (1,086 | ) | (785 | ) | ||||
Accumulated deficit | (209,773 | ) | (200,625 | ) | ||||
Total stockholders’ equity | 69,564 | 74,123 | ||||||
Total liabilities and stockholders’ equity | $ | 176,455 | $ | 172,867 | ||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||
Revenue: | ||||||||||||||||
Subscription and support revenue | $ | 45,617 | $ | 44,891 | $ | 90,275 | $ | 83,768 | ||||||||
Professional services and other revenue | 2,309 | 2,691 | $ | 4,304 | 5,650 | |||||||||||
Total revenue | 47,926 | 47,582 | 94,579 | 89,418 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of subscription and support revenue | 17,807 | 19,381 | 34,555 | 33,551 | ||||||||||||
Cost of professional services and other revenue | 2,092 | 2,228 | 3,986 | 4,804 | ||||||||||||
Total cost of revenue | 19,899 | 21,609 | 38,541 | 38,355 | ||||||||||||
Gross profit | 28,027 | 25,973 | 56,038 | 51,063 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 9,131 | 7,629 | 17,984 | 15,023 | ||||||||||||
Sales and marketing | 13,383 | 16,827 | 27,557 | 31,083 | ||||||||||||
General and administrative | 6,407 | 5,979 | 12,939 | 11,240 | ||||||||||||
Merger-related | 259 | 2,620 | 5,768 | 5,552 | ||||||||||||
Total operating expenses | 29,180 | 33,055 | 64,248 | 62,898 | ||||||||||||
Loss from operations | (1,153 | ) | (7,082 | ) | (8,210 | ) | (11,835 | ) | ||||||||
Other (expense) income, net | (27 | ) | 19 | (495 | ) | (36 | ) | |||||||||
Loss before income taxes | (1,180 | ) | (7,063 | ) | (8,705 | ) | (11,871 | ) | ||||||||
Provision for income taxes | 115 | 175 | 443 | 350 | ||||||||||||
Net loss | $ | (1,295 | ) | $ | (7,238 | ) | $ | (9,148 | ) | $ | (12,221 | ) | ||||
Net loss per share - basic and diluted | $ | (0.03 | ) | $ | (0.19 | ) | $ | (0.23 | ) | $ | (0.33 | ) | ||||
Weighted-average number of common shares used in computing net loss per share | 39,291,649 | 37,966,207 | 39,136,394 | 37,322,646 | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(in thousands) | ||||||||||||||||
Net loss | $ | (1,295 | ) | $ | (7,238 | ) | $ | (9,148 | ) | $ | (12,221 | ) | ||||
Other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustments | 158 | 39 | ( 301 | ) | 60 | |||||||||||
Comprehensive loss | $ | (1,137 | ) | $ | (7,199 | ) | $ | (9,449 | ) | $ | (12,161 | ) | ||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(in thousands, except share data) | ||||||||||||||||
Shares of common stock issued | ||||||||||||||||
Balance, beginning of period | 39,105,853 | 36,908,051 | 39,042,787 | 36,752,469 | ||||||||||||
Common stock issued upon acquisition | — | 1,056,763 | — | 1,056,763 | ||||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | 438,138 | 255,029 | 501,204 | 410,611 | ||||||||||||
Balance, end of period | 39,543,991 | 38,219,843 | 39,543,991 | 38,219,843 | ||||||||||||
Shares of treasury stock | ||||||||||||||||
Balance, beginning of period | (135,000 | ) | (135,000 | ) | (135,000 | ) | (135,000 | ) | ||||||||
Balance, end of period | (135,000 | ) | (135,000 | ) | (135,000 | ) | (135,000 | ) | ||||||||
Par value of common stock issued | ||||||||||||||||
Balance, beginning of period | $ | 39 | $ | 37 | $ | 39 | $ | 37 | ||||||||
Common stock issued upon acquisition | — | 1 | — | 1 | ||||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | — | — | — | — | ||||||||||||
Balance, end of period | $ | 39 | $ | 38 | $ | 39 | $ | 38 | ||||||||
Value of treasury stock | ||||||||||||||||
Balance, beginning of period | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | ||||
Balance, end of period | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | $ | (871 | ) | ||||
Additional paid-in capital | ||||||||||||||||
Balance, beginning of period | $ | 279,114 | $ | 253,244 | $ | 276,365 | $ | 251,122 | ||||||||
Common stock issued upon acquisition | — | 8,865 | — | 8,865 | ||||||||||||
Withholding tax on restricted stock units vesting | (396 | ) | — | (396 | ) | — | ||||||||||
Issuance of common stock upon exercise of stock options and pursuant to restricted stock units | 358 | 1,218 | 394 | 1,843 | ||||||||||||
Stock-based compensation expense | 2,179 | 1,438 | 4,892 | 2,935 | ||||||||||||
Balance, end of period | $ | 281,255 | $ | 264,765 | $ | 281,255 | $ | 264,765 | ||||||||
Accumulated deficit | ||||||||||||||||
Balance, beginning of period | $ | (208,478 | ) | $ | (183,705 | ) | $ | (200,625 | ) | $ | (178,722 | ) | ||||
Net loss | (1,295 | ) | (7,238 | ) | (9,148 | ) | (12,221 | ) | ||||||||
Balance, end of period | $ | (209,773 | ) | $ | (190,943 | ) | $ | (209,773 | ) | $ | (190,943 | ) | ||||
Accumulated other comprehensive loss | ||||||||||||||||
Balance, beginning of period | $ | (1,244 | ) | $ | (931 | ) | $ | (785 | ) | $ | (952 | ) | ||||
Foreign currency translation adjustment | 158 | 39 | (301 | ) | 60 | |||||||||||
Balance, end of period | $ | (1,086 | ) | $ | (892 | ) | $ | (1,086 | ) | $ | (892 | ) | ||||
Total stockholders’ equity | $ | 69,564 | $ | 72,097 | $ | 69,564 | $ | 72,097 | ||||||||
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
(in thousands) | ||||||||
Operating activities | ||||||||
Net loss | $ | (9,148 | ) | $ | (12,221 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization | 4,357 | 3,934 | ||||||
Stock-based compensation | 4,716 | 2,783 | ||||||
Provision for reserves on accounts receivable | 401 | 253 | ||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | 4,055 | (7,688 | ) | |||||
Prepaid expenses and other current assets | (5,357 | ) | (1,892 | ) | ||||
Other assets | (300 | ) | (435 | ) | ||||
Accounts payable | 2,038 | 58 | ||||||
Accrued expenses | (577 | ) | 7,924 | |||||
Operating leases | 3 | (162 | ) | |||||
Deferred revenue | 5,112 | 3,565 | ||||||
Net cash provided by (used in) operating activities | 5,300 | (3,881 | ) | |||||
Investing activities | ||||||||
Purchases of property and equipment | (1,197 | ) | (401 | ) | ||||
Cash paid for acquisition, net of cash acquired | — | (3,300 | ) | |||||
Capitalized internal-use software costs | (3,839 | ) | (2,372 | ) | ||||
Net cash used in investing activities | (5,036 | ) | (6,073 | ) | ||||
Financing activities | ||||||||
Proceeds from exercise of stock options | 394 | 1,843 | ||||||
Proceeds from debt | 10,000 | — | ||||||
Debt paydown | (5,000 | ) | — | |||||
Other financing activities | (429 | ) | (117 | ) | ||||
Net cash provided by financing activities | 4,965 | 1,726 | ||||||
Effect of exchange rate changes on cash and cash equivalents | (235 | ) | 131 | |||||
Net increase (decrease) in cash and cash equivalents | 4,994 | (8,097 | ) | |||||
Cash and cash equivalents at beginning of period | 22,759 | 29,306 | ||||||
Cash and cash equivalents at end of period | $ | 27,753 | $ | 21,209 | ||||
Supplemental disclosure of non-cash investing activities | ||||||||
Fair value of shares issued for acquisition of a business | $ | — | $ | 8,866 | ||||
Supplemental disclosure of cash flow information | ||||||||
Cash paid for operating lease liabilities | $ | 3,561 | $ | 3,718 | ||||
Accounts Receivable, net | Contract Assets (current) | Deferred Revenue (current) | Deferred Revenue (non-current) | Total Deferred Revenue | ||||||||||||||||
Balance at December 31, 2019 | $ | 31,181 | $ | 1,871 | $ | 49,260 | $ | 299 | $ | 49,559 | ||||||||||
Balance at June 30, 2020 | 26,794 | 2,017 | 54,647 | 92 | 54,739 |
June 30, 2020 | ||||||||||||||||
Description | Contracted Maturity | Cost | Fair Market Value | Balance Per Balance Sheet | ||||||||||||
Cash | Demand | $ | 27,712 | $ | 27,712 | $ | 27,712 | |||||||||
Money market funds | Demand | 41 | 41 | 41 | ||||||||||||
Total cash and cash equivalents | $ | 27,753 | $ | 27,753 | $ | 27,753 | ||||||||||
December 31, 2019 | ||||||||||||||||
Description | Contracted Maturity | Cost | Fair Market Value | Balance Per Balance Sheet | ||||||||||||
Cash | Demand | $ | 22,718 | $ | 22,718 | $ | 22,718 | |||||||||
Money market funds | Demand | 41 | 41 | 41 | ||||||||||||
Total cash and cash equivalents | $ | 22,759 | $ | 22,759 | $ | 22,759 | ||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Options outstanding | 2,372 | 2,624 | 2,372 | 2,624 | ||||||||||||
Restricted stock units outstanding | 3,580 | 3,187 | 3,580 | 3,187 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Expected life in years | 6.3 | 6.1 | 6.2 | 6.2 | ||||||||||||
Risk-free interest rate | 0.62 | % | 2.38 | % | 1.03 | % | 2.42 | % | ||||||||
Volatility | 48 | % | 44 | % | 46 | % | 44 | % | ||||||||
Dividend yield | — | — | — | — |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Stock-based compensation: | ||||||||||||||||
Cost of subscription and support revenue | $ | 123 | $ | 95 | $ | 313 | $ | 214 | ||||||||
Cost of professional services and other revenue | 90 | 68 | 170 | 152 | ||||||||||||
Research and development | 257 | 269 | 697 | 532 | ||||||||||||
Sales and marketing | 761 | 351 | 1,672 | 809 | ||||||||||||
General and administrative | 867 | 576 | 1,864 | 1,076 | ||||||||||||
$ | 2,098 | $ | 1,359 | $ | 4,716 | $ | 2,783 | |||||||||
Number of Shares | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value (1) | |||||||||||||
Outstanding at December 31, 2019 | 2,479,423 | $ | 8.96 | |||||||||||||
Granted | 79,920 | 7.76 | ||||||||||||||
Exercised | (61,096 | ) | 6.48 | $ | 108 | |||||||||||
Canceled | (126,007 | ) | 9.00 | |||||||||||||
Outstanding at June 30, 2020 | 2,372,240 | $ | 8.99 | 6.81 | $ | 852 | ||||||||||
Exercisable at June 30, 2020 | 1,368,007 | $ | 8.70 | 5.67 | $ | 740 | ||||||||||
(1) | The aggregate intrinsic value was calculated based on the positive difference between the fair value of the Company’s common stock on June 30, 2020 of $7.88 per share, or the date of exercise, as appropriate, and the exercise price of the underlying options. |
Shares | Weighted Average Grant Date Fair Value | |||||||
Unvested at December 31, 2019 | 3,626,364 | $ | 9.03 | |||||
Granted | 746,295 | 7.95 | ||||||
Vested and issued | (438,484 | ) | 8.92 | |||||
Canceled | (353,932 | ) | 8.52 | |||||
Unvested at June 30, 2020 | 3,580,243 | $ | 8.81 | |||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenue: | ||||||||||||||||
North America | $ | 26,039 | $ | 25,708 | $ | 51,038 | $ | 47,521 | ||||||||
Europe | 8,427 | 8,167 | 16,888 | 14,636 | ||||||||||||
Japan | 5,554 | 5,146 | 11,656 | 11,334 | ||||||||||||
Asia Pacific | 7,714 | 8,091 | 14,584 | 15,363 | ||||||||||||
Other | 192 | 470 | 413 | 564 | ||||||||||||
Total revenue | $ | 47,926 | $ | 47,582 | $ | 94,579 | $ | 89,418 | ||||||||
Allowance for Credit Losses | ||||
(in thousands) | ||||
Balance as of December 31, 2019 | $ | 904 | ||
Current provision for credit losses | 310 | |||
Write-offs against allowance | (563 | ) | ||
Recoveries | — | |||
Balance as of June 30, 2020 | $ | 651 | ||
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
On April 1, 2019, we purchased the online video platform assets of Ooyala, Inc. (“Ooyala”), which included the online video platform customers, Ooyala’s technology and Ooyala’s operations in Guadalajara, Mexico. We discuss the effect of the Ooyala transaction, when applicable, in our discussion and analysis of the financial condition and results of operations below. We are currently transitioning the acquired customers to our technology as we feel that our cloud-based services will add value to the acquired customers.
On August 1, 2019, we completed an acquisition of a company to help expand our offerings in key market segments. Revenue and earnings attributable to the August 1,2019 acquisition were not material.
For the nine months ended September 30, 2019, and 2018, our revenue derived from customers located outside North America was 48%46% and 46%47%, respectively. We expect the percentage of total net revenue derived from outside North America to increase in future periods as we continue to expand our international operations.
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|
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
Customers (at period end) | ||||||||
Premium | 2,362 | 2,227 | ||||||
Volume | 1,358 | 1,640 | ||||||
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| |||||
Total customers (at period end) | 3,720 | 3,867 | ||||||
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| |||||
Recurring dollar retention rate | 89 | % | 97 | % | ||||
Average annual subscription revenue per premium customer, excluding Starter edition customers (in thousands) | $ | 82.0 | $ | 74.7 | ||||
Average annual subscription revenue per premium customer for Starter edition customers only (in thousands) | $ | 4.6 | $ | 4.8 | ||||
Total backlog, excluding professional services engagements (in millions) | $ | 125.7 | $ | 108.0 | ||||
Total backlog to be recognized over next 12 months, excluding professional services engagements (in millions) | $ | 100.6 | $ | 86.0 |
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Customers (at period end) | ||||||||
Premium | 2,279 | 2,350 | ||||||
Volume | 1,144 | 1,411 | ||||||
Total customers (at period end) | 3,423 | 3,761 | ||||||
Recurring dollar retention rate | 84 | % | 90 | % | ||||
Average annual subscription revenue per premium customer, excluding Starter edition customers (in thousands) | $ | 86.4 | $ | 80.8 | ||||
Average annual subscription revenue per premium customer for Starter edition customers only (in thousands) | $ | 4.5 | $ | 4.5 | ||||
Total backlog, excluding professional services engagements (in millions) | $ | 136.9 | $ | 134.2 | ||||
Total backlog to be recognized over next 12 months, excluding professional services engagements (in millions) | $ | 108.8 | $ | 107.6 |
Player is offered to customers on a subscription basis. Customer arrangementsare typically
Cost of revenue increased in absolute dollars from the first nine months of 2018 to the first nine months of 2019.
functionality, expand our product offerings, continue the localization of our products in various languages, upgrade and extend our service offerings, and develop new technologies. Over the long term, we believe that research and development expenses as a percentage of revenue will decrease, but will vary depending upon the mix of revenue from new and existing products, features and functionality, as well as changes in the technology that our products must support, such as new operating systems or new Internet-connected devices.
and general corporate development activities.
2019.
We adopted ASC 842 on January 1, 2019. Refer to Note 14 for further information on our critical accounting policy relating to leases.
Other than the changes to the accounting for leases under ASC 842, we believe that our significant accounting policies have not materially changed from those described in the notes to our audited consolidated financial statements included in our Annual Report on Form10-K for the year ended December 31, 2018.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||
Revenue: | ||||||||||||||||
Subscription and support revenue | $ | 45,424 | $ | 37,442 | $ | 129,192 | $ | 113,176 | ||||||||
Professional services and other revenue | 2,010 | 3,679 | 7,660 | 10,793 | ||||||||||||
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| |||||||||
Total revenue | 47,434 | 41,121 | 136,852 | 123,969 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of subscription and support revenue | 16,686 | 13,142 | 50,237 | 39,723 | ||||||||||||
Cost of professional services and other revenue | 1,628 | 3,176 | 6,432 | 10,424 | ||||||||||||
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| |||||||||
Total cost of revenue | 18,314 | 16,318 | 56,669 | 50,147 | ||||||||||||
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| |||||||||
Gross profit | 29,120 | 24,803 | 80,183 | 73,822 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 8,127 | 8,314 | 23,150 | 23,832 | ||||||||||||
Sales and marketing | 14,567 | 14,009 | 45,650 | 42,508 | ||||||||||||
General and administrative | 6,245 | 5,621 | 17,485 | 18,056 | ||||||||||||
Merger-related | 2,539 | — | 8,091 | — | ||||||||||||
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Total operating expenses | 31,478 | 27,944 | 94,376 | 84,396 | ||||||||||||
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| |||||||||
Loss from operations | (2,358 | ) | (3,141 | ) | (14,193 | ) | (10,574 | ) | ||||||||
Other expense, net | (441 | ) | (217 | ) | (477 | ) | (427 | ) | ||||||||
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Loss before income taxes | (2,799 | ) | (3,358 | ) | (14,670 | ) | (11,001 | ) | ||||||||
Provision for income taxes | 171 | 144 | 521 | 410 | ||||||||||||
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Net loss | $ | (2,970 | ) | $ | (3,502 | ) | $ | (15,191 | ) | $ | (11,411 | ) | ||||
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Net loss per share - basic and diluted | $ | (0.08 | ) | $ | (0.10 | ) | $ | (0.40 | ) | $ | (0.32 | ) | ||||
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Weighted-average number of common shares used in computing net loss per share | 38,564,314 | 36,212,246 | 37,738,739 | 35,564,311 | ||||||||||||
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2019.
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||
Revenue: | ||||||||||||||||
Subscription and support revenue | $ | 45,617 | $ | 44,891 | $ | 90,275 | $ | 83,768 | ||||||||
Professional services and other revenue | 2,309 | 2,691 | 4,304 | 5,650 | ||||||||||||
Total revenue | 47,926 | 47,582 | 94,579 | 89,418 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of subscription and support revenue | 17,807 | 19,381 | 34,555 | 33,551 | ||||||||||||
Cost of professional services and other revenue | 2,092 | 2,228 | 3,986 | 4,804 | ||||||||||||
Total cost of revenue | 19,899 | 21,609 | 38,541 | 38,355 | ||||||||||||
Gross profit | 28,027 | 25,973 | 56,038 | 51,063 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 9,131 | 7,629 | 17,984 | 15,023 | ||||||||||||
Sales and marketing | 13,383 | 16,827 | 27,557 | 31,083 | ||||||||||||
General and administrative | 6,407 | 5,979 | 12,939 | 11,240 | ||||||||||||
Merger-related | 259 | 2,620 | 5,768 | 5,552 | ||||||||||||
Total operating expenses | 29,180 | 33,055 | 64,248 | 62,898 | ||||||||||||
Loss from operations | (1,153 | ) | (7,082 | ) | (8,210 | ) | (11,835 | ) | ||||||||
Other (expense) income, net | (27 | ) | 19 | (495 | ) | (36 | ) | |||||||||
Loss before income taxes | (1,180 | ) | (7,063 | ) | (8,705 | ) | (11,871 | ) | ||||||||
Provision for income taxes | 115 | 175 | 443 | 350 | ||||||||||||
Net loss | $ | (1,295 | ) | $ | (7,238 | ) | $ | (9,148 | ) | $ | (12,221 | ) | ||||
Net loss per share - basic and diluted | $ | (0.03 | ) | $ | (0.19 | ) | $ | (0.23 | ) | $ | (0.33 | ) | ||||
Weighted-average number of common shares used in computing net loss per share | 39,291,649 | 37,966,207 | 39,136,394 | 37,322,646 | ||||||||||||
2019
As of SeptemberJune 30, 2019,2020, we had $22.6$27.8 million of unrestricted cash and cash equivalents, a decreasean increase of $6.7$5.0 million from $29.3$22.8 million at December 31, 2018,2019, due primarily to $5.4$5.3 million paid as consideration in the Ooyala Acquisition and August Acquisition, $4.3 million in capitalizedinternal-use software costs, $600,000 in capital expenditures and $208,000 in other financing activities. These decreases were offset by proceeds from exercises of stock options of $3.2 million and $629,000 of cash provided by operating activities.
activities and $5.0 million in net proceeds from debt. These increases were offset by $3.8 million in
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Revenue by Product Line | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Premium | $ | 46,462 | 98 | % | $ | 40,036 | 97 | % | $ | 6,426 | 16 | % | ||||||||||||
Volume | 972 | 2 | 1,085 | 3 | (113 | ) | (10 | ) | ||||||||||||||||
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Total | $ | 47,434 | 100 | % | $ | 41,121 | 100 | % | $ | 6,313 | 15 | % | ||||||||||||
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Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Product Line | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Premium | $ | 46,941 | 98 | % | $ | 46,627 | 98 | % | $ | 314 | 1 | % | ||||||||||||
Volume | 985 | 2 | 955 | 2 | 30 | 3 | ||||||||||||||||||
Total | $ | 47,926 | 100 | % | $ | 47,582 | 100 | % | $ | 344 | 1 | % | ||||||||||||
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Revenue by Type | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 45,424 | 96 | % | $ | 37,442 | 91 | % | $ | 7,982 | 21 | % | ||||||||||||
Professional services and other | 2,010 | 4 | 3,679 | 9 | (1,669 | ) | (45 | ) | ||||||||||||||||
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Total | $ | 47,434 | 100 | % | $ | 41,121 | 100 | % | $ | 6,313 | 15 | % | ||||||||||||
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During the three months ended September 30, 2019, subscription and support revenue increased by $8.0 million, or 21%, compared to the three months ended September 30, 2018. The increase was primarily related to the 6% increase in the number of premium customers, some of which were acquired in the Ooyala Acquisition. Premium customers increased from 2,227 at September 30, 2018 to 2,362 at September 30, 2019 and the average annual subscription revenue per premium customer during the three months ended SeptemberJune 30, 20192020 compared to the three months ended June 30, 2019. In the three months ended June 30, 2020, volume revenue increased 13%by $30,000, or 3%, compared to the three months ended June 30, 2019.
Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Type | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 45,617 | 95 | % | $ | 44,891 | 94 | % | $ | 726 | 2 | % | ||||||||||||
Professional services and other | 2,309 | 5 | 2,691 | 6 | (382 | ) | (14 | ) | ||||||||||||||||
Total | $ | 47,926 | 100 | % | $ | 47,582 | 100 | % | $ | 344 | 1 | % | ||||||||||||
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Revenue by Geography | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
North America | $ | 24,904 | 53 | % | $ | 21,834 | 53 | % | $ | 3,070 | 14 | % | ||||||||||||
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Europe | 8,178 | 17 | 7,491 | 18 | 687 | 9 | ||||||||||||||||||
Japan | 5,391 | 11 | 5,464 | 13 | (73 | ) | (1 | ) | ||||||||||||||||
Asia Pacific | 8,646 | 18 | 6,125 | 15 | 2,521 | 41 | ||||||||||||||||||
Other | 315 | 1 | 207 | 1 | 108 | 52 | ||||||||||||||||||
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International subtotal | 22,530 | 47 | 19,287 | 47 | 3,243 | 17 | ||||||||||||||||||
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Total | $ | 47,434 | 100 | % | $ | 41,121 | 100 | % | $ | 6,313 | 15 | % | ||||||||||||
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For purposes of this section, we
Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Geography | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
North America | $ | 26,039 | 54 | % | $ | 25,708 | 54 | % | $ | 331 | 1 | % | ||||||||||||
Europe | 8,427 | 18 | 8,167 | 17 | 260 | 3 | ||||||||||||||||||
Japan | 5,554 | 12 | 5,146 | 11 | 408 | 8 | ||||||||||||||||||
Asia Pacific | 7,714 | 16 | 8,091 | 17 | (377 | ) | (5 | ) | ||||||||||||||||
Other | 192 | — | 470 | 1 | (278 | ) | (59 | ) | ||||||||||||||||
International subtotal | 21,887 | 46 | 21,874 | 46 | 13 | 0 | ||||||||||||||||||
Total | $ | 47,926 | 100 | % | $ | 47,582 | 100 | % | $ | 344 | 1 | % | ||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Cost of Revenue | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 17,807 | 39 | % | $ | 19,381 | 43 | % | $ | (1,574 | ) | (8 | )% | |||||||||||
Professional services and other | 2,092 | 91 | 2,228 | 83 | (136 | ) | (6 | ) | ||||||||||||||||
Total | $ | 19,899 | 42 | % | $ | 21,609 | 45 | % | $ | (1,710 | ) | (8 | )% | |||||||||||
Cost of Revenue
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Cost of Revenue | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 16,686 | 37 | % | $ | 13,142 | 35 | % | $ | 3,544 | 27 | % | ||||||||||||
Professional services and other | 1,628 | 81 | 3,176 | 86 | (1,548 | ) | (49 | ) | ||||||||||||||||
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Total | $ | 18,314 | 39 | % | $ | 16,318 | 40 | % | $ | 1,996 | 12 | % | ||||||||||||
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In the three months ended September 30, 2019, cost of subscription and support revenue increased $3.5 million, or 27%, compared to the three months ended September 30, 2018. The increasedecrease resulted primarily from increasesthe transition of acquired Ooyala customers to our technology. Specifically, there were decreases in network hosting services, employee-related expenses, partner commissions and contractor expenses of $2.0 million, $494,000, $110,000 and $107,000, respectively. These decreases were offset by increases in content delivery network, and maintenance expenses of $1.4 million, $1.3 million, and $450,000 respectively. There were also increases in third-party software integrated with our service offering partner commissions, and amortization of capitalizedinternal-use software developmentmaintenance expenses of $297,000, $255,000,$649,000, $635,000 and $152,000$118,000, respectively. These increased primarily due to incremental costs from the Ooyala Acquisition. These increases were offset by decreases in employee-related and contractor expenses of $160,000 and $102,000, respectively.
$236,000.
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Gross Profit | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 28,738 | 63 | % | $ | 24,300 | 65 | % | $ | 4,438 | 18 | % | ||||||||||||
Professional services and other | 382 | 19 | 503 | 14 | (121 | ) | (24 | )% | ||||||||||||||||
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Total | $ | 29,120 | 61 | % | $ | 24,803 | 60 | % | $ | 4,317 | 17 | % | ||||||||||||
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Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Gross Profit | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 27,810 | 61 | % | $ | 25,510 | 57 | % | $ | 2,300 | 9 | % | ||||||||||||
Professional services and other | 217 | 9 | 463 | 17 | (246 | ) | (53 | )% | ||||||||||||||||
Total | $ | 28,027 | 58 | % | $ | 25,973 | 55 | % | $ | 2,054 | 8 | % | ||||||||||||
Three Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Operating Expenses | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Research and development | $ | 8,127 | 17 | % | $ | 8,314 | 20 | % | $ | (187 | ) | (2 | )% | |||||||||||
Sales and marketing | 14,567 | 31 | 14,009 | 34 | 558 | 4 | ||||||||||||||||||
General and administrative | 6,245 | 13 | 5,621 | 14 | 624 | 11 | ||||||||||||||||||
Merger-related | 2,539 | 5 | — | — | 2,539 | nm | ||||||||||||||||||
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Total | $ | 31,478 | 66 | % | $ | 27,944 | 68 | % | $ | 3,534 | 13 | % | ||||||||||||
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nm – not meaningful
Three Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Operating Expenses | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Research and development | $ | 9,131 | 19 | % | $ | 7,629 | 16 | % | $ | 1,502 | 20 | % | ||||||||||||
Sales and marketing | 13,383 | 28 | 16,827 | 35 | (3,444 | ) | (20 | ) | ||||||||||||||||
General and administrative | 6,407 | 13 | 5,979 | 13 | 428 | 7 | ||||||||||||||||||
Merger-related | 259 | 1 | 2,620 | 6 | (2,361 | ) | (90 | ) | ||||||||||||||||
Total | $ | 29,180 | 61 | % | $ | 33,055 | 69 | % | $ | (3,875 | ) | (12 | )% | |||||||||||
decrease in the second half of 2020 as a result of restructuring activities taken in the first half of 2020.
remain relatively unchanged.
activities.
2019
Revenue by Product Line Premium Volume Total Nine Months Ended September 30, 2019 2018 Change Amount Percentage of
Revenue Amount Percentage of
Revenue Amount % (in thousands, except percentages) $ 133,970 98 % $ 120,471 97 % $ 13,499 11 % 2,882 2 3,498 3 (616 ) (18 ) $ 136,852 100 % $ 123,969 100 % $ 12,883 10 %
Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Product Line | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Premium | $ | 92,728 | 98 | % | $ | 87,508 | 98 | % | $ | 5,220 | 6 | % | ||||||||||||
Volume | 1,851 | 2 | 1,910 | 2 | (59 | ) | (3 | ) | ||||||||||||||||
Total | $ | 94,579 | 100 | % | $ | 89,418 | 100 | % | $ | 5,161 | 6 | % | ||||||||||||
Nine Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Revenue by Type | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 129,192 | 94 | % | $ | 113,176 | 91 | % | $ | 16,016 | 14 | % | ||||||||||||
Professional services and other | 7,660 | 6 | 10,793 | 9 | (3,133 | ) | (29 | ) | ||||||||||||||||
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Total | $ | 136,852 | 100 | % | $ | 123,969 | 100 | % | $ | 12,883 | 10 | % | ||||||||||||
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Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Type | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 90,275 | 95 | % | $ | 83,768 | 94 | % | $ | 6,507 | 8 | % | ||||||||||||
Professional services and other | 4,304 | 5 | 5,650 | 6 | (1,346 | ) | (24 | ) | ||||||||||||||||
Total | $ | 94,579 | 100 | % | $ | 89,418 | 100 | % | $ | 5,161 | 6 | % | ||||||||||||
Nine Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Revenue by Geography | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
North America | $ | 72,425 | 53 | % | $ | 67,351 | 54 | % | $ | 5,074 | 8 | % | ||||||||||||
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Europe | 22,814 | 17 | 20,538 | 17 | 2,276 | 11 | ||||||||||||||||||
Japan | 16,725 | 12 | 16,319 | 13 | 406 | 2 | ||||||||||||||||||
Asia Pacific | 24,009 | 17 | 19,292 | 16 | 4,717 | 24 | ||||||||||||||||||
Other | 879 | 1 | 469 | — | 410 | 87 | ||||||||||||||||||
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International subtotal | 64,427 | 47 | 56,618 | 46 | 7,809 | 14 | ||||||||||||||||||
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Total | $ | 136,852 | 100 | % | $ | 123,969 | 100 | % | $ | 12,883 | 10 | % | ||||||||||||
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For purposes
Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Revenue by Geography | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
North America | $ | 51,038 | 54 | % | $ | 47,521 | 53 | % | $ | 3,517 | 7 | % | ||||||||||||
Europe | 16,888 | 18 | 14,636 | 16 | 2,252 | 15 | ||||||||||||||||||
Japan | 11,656 | 12 | 11,334 | 13 | 322 | 3 | ||||||||||||||||||
Asia Pacific | 14,584 | 16 | 15,363 | 17 | (779 | ) | (5 | ) | ||||||||||||||||
Other | 413 | — | 564 | 1 | (151 | ) | (27 | ) | ||||||||||||||||
International subtotal | 43,541 | 46 | 41,897 | 47 | 1,644 | 4 | ||||||||||||||||||
Total | $ | 94,579 | 100 | % | $ | 89,418 | 100 | % | $ | 5,161 | 6 | % | ||||||||||||
Cost of Revenue Subscription and support Professional services and other Total Nine Months Ended September 30, 2019 2018 Change Amount Percentage of
Related
Revenue Amount Percentage of
Related
Revenue Amount % (in thousands, except percentages) $ 50,237 39 % $ 39,723 35 % $ 10,514 26 % 6,432 84 10,424 97 (3,992 ) (38 ) $ 56,669 41 % $ 50,147 40 % $ 6,522 13 %
Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Cost of Revenue | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 34,555 | 38 | % | $ | 33,551 | 40 | % | $ | 1,004 | 3 | % | ||||||||||||
Professional services and other | 3,986 | 93 | 4,804 | 85 | (818 | ) | (17 | ) | ||||||||||||||||
Total | $ | 38,541 | 41 | % | $ | 38,355 | 43 | % | $ | 186 | 0 | % | ||||||||||||
Ooyala.
$163,000, respectively.
Nine Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Gross Profit | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 78,955 | 61 | % | $ | 73,453 | 65 | % | $ | 5,502 | 7 | % | ||||||||||||
Professional services and other | 1,228 | 16 | 369 | 3 | 859 | 233 | ||||||||||||||||||
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Total | $ | 80,183 | 59 | % | $ | 73,822 | 60 | % | $ | 6,361 | 9 | % | ||||||||||||
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Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Gross Profit | Amount | Percentage of Related Revenue | Amount | Percentage of Related Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Subscription and support | $ | 55,720 | 62 | % | $ | 50,217 | 60 | % | $ | 5,503 | 11 | % | ||||||||||||
Professional services and other | 318 | 7 | 846 | 15 | (528 | ) | (62 | ) | ||||||||||||||||
Total | $ | 56,038 | 59 | % | $ | 51,063 | 57 | % | $ | 4,975 | 10 | % | ||||||||||||
Nine Months Ended September 30, | ||||||||||||||||||||||||
2019 | 2018 | Change | ||||||||||||||||||||||
Operating Expenses | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Research and development | $ | 23,150 | 17 | % | $ | 23,832 | 19 | % | $ | (682 | ) | (3 | )% | |||||||||||
Sales and marketing | 45,650 | 33 | 42,508 | 34 | 3,142 | 7 | ||||||||||||||||||
General and administrative | 17,485 | 13 | 18,056 | 15 | (571 | ) | (3 | ) | ||||||||||||||||
Merger-related | 8,091 | 6 | — | — | 8,091 | nm | ||||||||||||||||||
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Total | $ | 94,376 | 69 | % | $ | 84,396 | 68 | % | $ | 9,980 | 12 | % | ||||||||||||
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nm – not meaningful
Six Months Ended June 30, | ||||||||||||||||||||||||
2020 | 2019 | Change | ||||||||||||||||||||||
Operating Expenses | Amount | Percentage of Revenue | Amount | Percentage of Revenue | Amount | % | ||||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||||||||||
Research and development | $ | 17,984 | 19 | % | $ | 15,023 | 17 | % | $ | 2,961 | 20 | % | ||||||||||||
Sales and marketing | 27,557 | 29 | 31,083 | 35 | (3,526 | ) | (11 | ) | ||||||||||||||||
General and administrative | 12,939 | 14 | 11,240 | 13 | 1,699 | 15 | ||||||||||||||||||
Merger-related | 5,768 | 6 | 5,552 | 6 | 216 | 4 | ||||||||||||||||||
Total | $ | 64,248 | 68 | % | $ | 62,898 | 70 | % | $ | 1,350 | 2 | % | ||||||||||||
General and Administrative. In the nine months ended September 30, 2019, general and administrative decreased by $571,000 or 3%, compared to the nine months ended September 30, 2018 primarily due to decreases in contractor, employee-related, amortization, and partner commissions expenses of $982,000, $395,000, $176,000 and $117,000,$1.2 million, respectively. These decreases were offset by increases in stock-based compensation, intangible amortization and computer maintenance and support of $863,000, $315,000 and $180,000, respectively.
six months ended June 30, 2019.
Nine Months Ended September 30, | ||||||||
Condensed Consolidated Statements of Cash Flow Data | 2019 | 2018 | ||||||
(in thousands) | ||||||||
Cash flows provided by (used in) operating activities | 629 | (234 | ) | |||||
Cash flows used in investing activities | (10,266 | ) | (3,849 | ) | ||||
Cash flows provided by financing activities | 3,007 | 5,012 |
Six Months Ended June 30, | ||||||||
Condensed Consolidated Statements of Cash Flow Data | 2020 | 2019 | ||||||
(in thousands) | ||||||||
Cash flows provided by (used in) operating activities | 5,300 | (3,881 | ) | |||||
Cash flows used in investing activities | (5,036 | ) | (6,073 | ) | ||||
Cash flows provided by financing activities | 4,965 | 1,726 |
current assets.
The decrease in cash used in investing activities is primarily due to consideration paid in 2019 related to the Ooyala acquisition.
options.
2020. The Line of Credit matures in December 2021.
2019.
Our contractual obligations as of December 31, 20182019 are summarized in our Annual Report on Form2018.
2019.
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Three Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
Revenues generated in locations outside the United States | 51 | % | 50 | % | ||||
Revenues in currencies other than the United States dollar (1) | 30 | % | 31 | % | ||||
Expenses in currencies other than the United States dollar (1) | 18 | % | 17 | % |
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
Revenues generated in locations outside the United States | 51 | % | 49 | % | ||||
Revenues in currencies other than the United States dollar (1) | 31 | % | 31 | % | ||||
Expenses in currencies other than the United States dollar (1) | 16 | % | 15 | % |
Three Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Revenues generated in locations outside the United States | 50 | % | 50 | % | ||||
Revenues in currencies other than the United States dollar (1) | 30 | % | 29 | % | ||||
Expenses in currencies other than the United States dollar (1) | 15 | % | 15 | % | ||||
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Revenues generated in locations outside the United States | 50 | % | 50 | % | ||||
Revenues in currencies other than the United States dollar (1) | 30 | % | 32 | % | ||||
Expenses in currencies other than the United States dollar (1) | 15 | % | 14 | % |
(1) | Percentage of revenues and expenses denominated in foreign currency for the three and |
Three Months Ended September 30, 2019 | Three Months Ended September 30, 2018 | |||||||||||||||
Revenues | Expenses | Revenues | Expenses | |||||||||||||
Euro | 7 | % | 1 | % | 6 | % | 2 | % | ||||||||
British pound | 8 | 6 | 6 | 6 | ||||||||||||
Japanese Yen | 11 | 3 | 13 | 5 | ||||||||||||
Other | 4 | 8 | 6 | 4 | ||||||||||||
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Total | 30 | % | 18 | % | 31 | % | 17 | % |
Nine Months Ended September 30, 2019 | Nine Months Ended September 30, 2018 | |||||||||||||||
Revenues | Expenses | Revenues | Expenses | |||||||||||||
Euro | 7 | % | 1 | % | 6 | % | 1 | % | ||||||||
British pound | 7 | 6 | 7 | 6 | ||||||||||||
Japanese Yen | 12 | 3 | 13 | 4 | ||||||||||||
Other | 5 | 6 | 5 | 4 | ||||||||||||
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Total | 31 | % | 16 | % | 31 | % | 15 | % |
Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | |||||||||||||||
Revenues | Expenses | Revenues | Expenses | |||||||||||||
Euro | 8 | % | 1 | % | 7 | % | 2 | % | ||||||||
British pound | 6 | 5 | 7 | 5 | ||||||||||||
Japanese Yen | 12 | 2 | 11 | 3 | ||||||||||||
Other | 4 | 7 | 4 | 5 | ||||||||||||
Total | 30 | % | 15 | % | 29 | % | 15 | % | ||||||||
Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | |||||||||||||||
Revenues | Expenses | Revenues | Expenses | |||||||||||||
Euro | 8 | % | 1 | % | 7 | % | 1 | % | ||||||||
British pound | 6 | 5 | 7 | 5 | ||||||||||||
Japanese Yen | 12 | 2 | 13 | 4 | ||||||||||||
Other | 4 | 7 | 5 | 4 | ||||||||||||
Total | 30 | % | 15 | % | 32 | % | 14 | % |
2020.
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 1. | LEGAL PROCEEDINGS |
On January 30, 2019, Uniloc 2017 LLC (“Uniloc”) filed a complaint against us and our subsidiary, Brightcove Holdings, Inc. in the United States District Court for the District of Delaware. The complaint alleges that we infringed four patents and seeks monetary damages and other relief.
On or about June 24, 2019, Dynamic Data Technologies, LLC (“DDT”) filed a complaint against us and our subsidiary, Brightcove Holdings, Inc., in the United States District Court for the District of Delaware. The complaint alleges that we infringed patents owned by DDT and seeks monetary damages and other relief. We filed a motion to dismiss the complaint and that motion is pending review by the court. We cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can we reasonably estimate the potential loss, if any.
In addition, we are, from time to time, party to litigation arising in the ordinary course of our business. Management does not believe that the outcome of these claims will have a material adverse effect on our consolidated financial position, results of operations or cash flows based on the status of proceedings at this time.
ITEM 1A. | RISK FACTORS |
2018,2019, under the heading “Part I — Item 1A. Risk Factors,” together with all of the other information in this Quarterly Report on FormITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSOn August 1, 2019, partial consideration a pandemic. TheAugust Acquisition,fiscal year ended December 31, 2019, under the heading “Part I — Item 1A. Risk Factors”.
ITEM 5. | OTHER INFORMATION |
ITEM 6. | EXHIBITS |
Exhibits | ||
3.1 (1) | Eleventh Amended and Restated Certificate of Incorporation. | |
3.2 (2) | Amended and RestatedBy-Laws. | |
4.1 (3) | Form of Common Stock certificate of the Registrant. | |
31.1 | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of | |
31.2 | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1^ | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | Inline XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
101.SCH | XBRL Inline Taxonomy Extension Schema Document. | |
101.CAL | XBRL Inline Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Inline Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Inline Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Inline Taxonomy Extension Presentation Linkbase Document. | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
(1) | Filed as Exhibit 3.2 to Amendment No. 5 to Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 6, 2012, and incorporated herein by reference. |
(2) | Filed as Exhibit 3.3 to Amendment No. 5 to Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 6, 2012, and incorporated herein by reference. |
(3) | Filed as Exhibit 4.1 to Amendment No. 5 to Registrant’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 6, 2012, and incorporated herein by reference. |
^ | Furnished herewith. |
BRIGHTCOVE INC. | ||||||
(Registrant) | ||||||
Date: | By: | |||||
/s/ Jeff Ray | ||||||
Jeff Ray | ||||||
Chief Executive Officer | ||||||
(Principal Executive Officer) | ||||||
Date: | By: | |||||
/s/ Robert Noreck | ||||||
Robert Noreck | ||||||
Chief Financial Officer | ||||||
(Principal Financial Officer) |