Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2020 | May 04, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-36384 | |
Entity Registrant Name | THE RUBICON PROJECT, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-8881738 | |
Entity Address, Address Line One | 12181 Bluff Creek Drive, | |
Entity Address, Address Line Two | 4th Floor | |
Entity Address, City or Town | Los Angeles, | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90094 | |
City Area Code | (310) | |
Local Phone Number | 207-0272 | |
Title of 12(b) Security | Common stock, par value $0.00001 per share | |
Trading Symbol | RUBI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 107,287,069 | |
Entity Central Index Key | 0001595974 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 71,283 | $ 88,888 |
Accounts receivable, net | 158,248 | 217,571 |
Prepaid expenses and other current assets | 7,323 | 6,591 |
TOTAL CURRENT ASSETS | 236,854 | 313,050 |
Property and equipment, net | 21,589 | 23,667 |
Right-of-use lease asset | 19,549 | 21,491 |
Internal use software development costs, net | 16,631 | 16,053 |
Intangible assets, net | 10,325 | 11,386 |
Other assets, non-current | 1,900 | 2,103 |
Goodwill | 7,370 | 7,370 |
TOTAL ASSETS | 314,218 | 395,120 |
Current liabilities: | ||
Accounts payable and accrued expenses | 194,036 | 259,439 |
Lease liabilities, current | 7,158 | 7,282 |
Other current liabilities | 929 | 778 |
TOTAL CURRENT LIABILITIES | 202,123 | 267,499 |
Lease liabilities, non-current | 13,441 | 15,231 |
Other liabilities, non-current | 426 | 454 |
TOTAL LIABILITIES | 215,990 | 283,184 |
Commitments and contingencies (Note 9) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock, $0.00001 par value, 10,000 shares authorized at March 31, 2020 and December 31, 2019; 0 shares issued and outstanding at March 31, 2020 and December 31, 2019 | 0 | 0 |
Common stock, $0.00001 par value; 500,000 shares authorized at March 31, 2020 and December 31, 2019; 55,060 and 53,888 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 1 | 1 |
Additional paid-in capital | 449,820 | 453,064 |
Accumulated other comprehensive loss | (834) | (45) |
Accumulated deficit | (350,759) | (341,084) |
TOTAL STOCKHOLDERS' EQUITY | 98,228 | 111,936 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 314,218 | $ 395,120 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (usd per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares, issued (in shares) | 55,060,000 | 53,888,000 |
Common stock, shares, outstanding (in shares) | 55,060,000 | 53,888,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Revenue | $ 36,295 | $ 32,416 |
Expenses: | ||
Cost of revenue | 14,003 | 15,116 |
Sales and marketing | 11,426 | 10,592 |
Technology and development | 10,696 | 9,716 |
General and administrative | 10,897 | 10,280 |
Total expenses | 47,022 | 45,704 |
Loss from operations | (10,727) | (13,288) |
Other (income) expense: | ||
Interest income, net | (144) | (193) |
Other income | (9) | (142) |
Foreign exchange (gain) loss, net | (698) | 301 |
Total other income, net | (851) | (34) |
Loss before income taxes | (9,876) | (13,254) |
Benefit for income taxes | (201) | (708) |
Net loss | $ (9,675) | $ (12,546) |
Net loss per share: | ||
Basic and Diluted (usd per share) | $ (0.18) | $ (0.24) |
Weighted average shares used to compute net loss per share: | ||
Basic and Diluted (in shares) | 54,866 | 51,577 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (9,675) | $ (12,546) |
Other comprehensive income (loss): | ||
Unrealized gain on investments | 0 | 2 |
Foreign currency translation adjustments | (789) | 92 |
Other comprehensive income (loss) | (789) | 94 |
Comprehensive loss | $ (10,464) | $ (12,452) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning Balance (in shares) at Dec. 31, 2018 | 51,159 | ||||
Beginning Balance at Dec. 31, 2018 | $ 118,013 | $ 1 | $ 433,877 | $ (259) | $ (315,606) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 76 | ||||
Exercise of common stock options | 251 | 251 | |||
Restricted stock awards, net (in shares) | (182) | ||||
Issuance of common stock related to RSU vesting (in shares) | 1,171 | ||||
Shares withheld related to net share settlement (in shares) | (459) | ||||
Shares withheld related to net share settlement | (1,835) | (1,835) | |||
Stock-based compensation | 4,514 | 4,514 | |||
Other comprehensive income (loss) | 94 | 94 | |||
Net loss | (12,546) | (12,546) | |||
Ending Balance (in shares) at Mar. 31, 2019 | 51,765 | ||||
Ending Balance at Mar. 31, 2019 | $ 108,491 | $ 1 | 436,807 | (165) | (328,152) |
Beginning Balance (in shares) at Dec. 31, 2019 | 53,888 | 53,888 | |||
Beginning Balance at Dec. 31, 2019 | $ 111,936 | $ 1 | 453,064 | (45) | (341,084) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options (in shares) | 27 | ||||
Exercise of common stock options | 23 | 23 | |||
Issuance of common stock related to RSU vesting (in shares) | 1,861 | ||||
Shares withheld related to net share settlement (in shares) | (716) | ||||
Shares withheld related to net share settlement | (7,485) | (7,485) | |||
Stock-based compensation | 4,218 | 4,218 | |||
Other comprehensive income (loss) | (789) | (789) | |||
Net loss | $ (9,675) | (9,675) | |||
Ending Balance (in shares) at Mar. 31, 2020 | 55,060 | 55,060 | |||
Ending Balance at Mar. 31, 2020 | $ 98,228 | $ 1 | $ 449,820 | $ (834) | $ (350,759) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OPERATING ACTIVITIES: | ||
Net loss | $ (9,675) | $ (12,546) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 7,524 | 8,640 |
Stock-based compensation | 4,057 | 4,369 |
Loss on disposal of property and equipment | (6) | 4 |
Provision for doubtful accounts | 2 | 775 |
Accretion of available-for-sale securities | 0 | 24 |
Non-cash lease expense | 23 | 0 |
Unrealized foreign currency gains, net | (1,083) | (183) |
Deferred income taxes | 161 | (753) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 58,600 | 46,446 |
Prepaid expenses and other assets | (738) | 640 |
Accounts payable and accrued expenses | (64,250) | (49,482) |
Other liabilities | 152 | (1,386) |
Net cash used in operating activities | (5,233) | (3,452) |
INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (2,274) | (142) |
Capitalized internal use software development costs | (2,337) | (2,098) |
Maturities of available-for-sale securities | 0 | 7,500 |
Net cash (used in) provided by investing activities | (4,611) | 5,260 |
FINANCING ACTIVITIES: | ||
Proceeds from exercise of stock options | 23 | 251 |
Taxes paid related to net share settlement | (7,485) | (1,835) |
Net cash used in financing activities | (7,462) | (1,584) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (299) | 38 |
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (17,605) | 262 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH — Beginning of period | 88,888 | 80,452 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH — End of period | 71,283 | 80,714 |
SUPPLEMENTAL DISCLOSURES OF OTHER CASH FLOW INFORMATION: | ||
Cash paid for income taxes | 50 | 92 |
Cash paid for interest | 15 | 10 |
Capitalized assets financed by accounts payable and accrued expenses | 338 | 509 |
Capitalized stock-based compensation | $ 161 | $ 145 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Company Overview The Rubicon Project, Inc., or Rubicon Project (the "Company"), was formed on April 20, 2007 in Delaware and began operations in April 2007. The Company is headquartered in Los Angeles, California. On April 1, 2020, the Company completed a stock-for-stock merger ("Merger") with Telaria, Inc., ("Telaria"), a leading provider of connected television ("CTV") technology, creating an independent sell-side advertising platform, offering a single partner for transacting CTV, desktop display, video, audio, and mobile inventory across all geographies and auction types. The Company provides a technology solution to automate the purchase and sale of digital advertising inventory for buyers and sellers. The Company’s platform features applications and services for sellers of digital advertising inventory, or publishers, that own or operate websites, applications and other digital media properties, to manage and monetize their inventory; applications and services for buyers, including advertisers, agencies, agency trading desks, and demand side platforms, to buy digital advertising inventory; and a transparent, independent marketplace that brings buyers and sellers together and facilitates intelligent decision making and automated transaction execution at scale. The Company's clients include many of the world's leading publishers of websites and mobile applications and buyers of digital advertising inventory. Publishers monetize their inventory through the Company’s platform by seamlessly connecting to a global market of integrated buyers that transact through real-time bidding, which includes direct sale of premium inventory to a buyer, referred to as private marketplace ("PMP"), and open auction bidding, where buyers bid against each other in a real-time auction for the right to purchase a publisher’s inventory, referred to as open marketplace ("OMP"). At the same time, buyers leverage the Company’s platform to manage their advertising spending and reach their target audiences, simplify order management and campaign tracking, obtain actionable insights into audiences for their advertising, and access impression-level purchasing from thousands of sellers. The Company operates on a worldwide basis, with an established operating presence in North America, Australia, and Europe and a developing presence in Asia and South America. Basis of Presentation and Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles, or GAAP, for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the results for the interim period presented have been included. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for any future interim period, the year ending December 31, 2020 , or for any future year. The condensed consolidated balance sheet at December 31, 2019 has been derived from the audited financial statements at that date, but does not include all of the disclosures required by GAAP. The accompanying condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in its 2019 Annual Report on Form 10-K. There have been no significant changes in the Company's accounting policies from those disclosed in its audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in its Annual Report on Form 10-K. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported and disclosed financial statements and accompanying footnotes. Due to the economic uncertainty as a result of the novel coronavirus pandemic, it has become more difficult to apply certain assumptions and judgments into these estimates. The extent of the impact of novel coronavirus pandemic on the Company's operational and financial performance will depend on certain developments, as discussed in more detail within Item 2. Management's Discussion and Analysis and Item 1A.Risk Factors. During the quarter ended March 31, 2020, this uncertainty resulted in a higher level of judgment related to its estimates and assumptions. As of the date of issuance of the condensed consolidated financial statements for the three months ended March, 31, 2020, the Company is not aware of any specific event or circumstance that would require us to update our estimates, judgments, or revise the carrying value of our assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company's financial statements. Recently Adopted Accounting Standards In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13— Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (" ASU 2016-13"). This guidance requires entities to use a current expected credit loss methodology to measure impairments of certain financial assets and to recognize an allowance for its estimate of lifetime expected credit losses. The main objective of this update is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The guidance was effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted ASU 2016-13 as of January 1, 2020. The standard had no material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13— Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"), to streamline the disclosure requirements of ASC Topic 820—Fair Value Measurement. ASU 2018 removes certain disclosure requirements, including the valuation process for Level 3 fair value measurements, and adds certain quantitative disclosures around Level 3 fair value measurements. This ASU is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, with early adoption permitted. The provisions of ASU 2018-13 are required to be adopted retrospectively, with the exception of disclosure of the range and weighted average of significant unobservable inputs used to develop Level 3 measurements, which can be adopted prospectively. The Company adopted ASU 2018-13 as of January 1, 2020. The standard had no material impact on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15— Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). ASU 2018-15 was issued to clarify the requirements of ASC 350-40— Intangibles—Goodwill and Other—Internal-Use Software ("ASC 350-40"). The ASU clarifies that implementation, setup and other upfront costs related to cloud computing agreements ("CCA") should be accounted for under ASC 350-40. ASC 2018-15 will require companies to capitalize certain costs incurred when purchasing a CCA that is a service. Under the new guidance, companies will apply the same criteria for capitalizing implementation costs in a CCA service as they would for internal-use software. The capitalized implementation costs will generally be expensed over the term of the service arrangement and the related assets will be assessed for impairment using the same model applied to long-lived assets. This ASU is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, with early adoption permitted. ASU 2018-15 can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company adopted ASU 2018-15 as of January 1, 2020 on a prospective basis. The standard had no material impact on its consolidated financial statements and related disclosures. Recent Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12— Simplifying the Accounting for Income Taxes ("ASU 2019-12") . ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to general principles in Topic 740 and clarifies and amends existing guidance for clarity and consistent application. This guidance is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020 including interim reporting periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements and related disclosures. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The following table presents the basic and diluted net loss per share: Three Months Ended March 31, 2020 March 31, 2019 (in thousands, except per share data) Basic and Diluted EPS: Net loss $ (9,675 ) $ (12,546 ) Weighted-average common shares outstanding 54,868 51,635 Weighted-average unvested restricted stock (2 ) (58 ) Weighted-average common shares outstanding used to compute net loss per share 54,866 51,577 Basic and diluted net loss per share $ (0.18 ) $ (0.24 ) The following weighted-average shares have been excluded from the calculation of diluted net loss per share attributable to common stockholders for each period presented because they are anti-dilutive: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Options to purchase common stock 1,239 513 Unvested restricted stock awards 1 44 Unvested restricted stock units 3,978 2,746 ESPP 61 28 Total shares excluded from net loss per share 5,279 3,331 |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues The Company generates revenue from transactions where it provides a platform for the purchase and sale of digital advertising inventory. The Company also generates revenue from the fee it charges clients for use of its Demand Manager product, which generally is a percentage of the client's advertising spending on any advertising marketplace. The Company’s advertising automation solution is a marketplace for sellers of digital advertising inventory (providers of websites, mobile applications and other digital media properties, and their representatives) and buyers of digital advertising inventory (including advertisers, agencies, agency trading desks, and demand-side platforms). This solution incorporates proprietary machine-learning algorithms, sophisticated data processing, high-volume storage, detailed analytics capabilities, and a distributed infrastructure. Together, these features form the basis for the Company’s automated advertising solution that brings buyers and sellers together and facilitates intelligent decision-making and automated transaction execution for the digital advertising inventory managed on the Company's platform. Digital advertising inventory is created when consumers access sellers’ content. Sellers provide digital advertising inventory to the Company’s platform in the form of advertising requests, or ad requests. When the Company receives ad requests from sellers, it sends bid requests to buyers, which enable buyers to bid on sellers’ digital advertising inventory. Winning bids can create advertising, or paid impressions, for the seller to present to the consumer. The total volume of spending between buyers and sellers on the Company’s platform is referred to as advertising spend. The Company keeps a percentage of that advertising spend as a fee, and remits the remainder to the seller. The fee that the Company retains from the gross advertising spend on its platform is recognized as revenue. The fee earned on each transaction is based on the pre-existing agreement between the Company and the seller and the clearing price of the winning bid. The Company recognizes revenue upon fulfillment of its performance obligation to a client, which occurs at the point in time an ad renders and is counted as a paid impression, subject to an underlying agreement existing with the client and a fixed or determinable transaction price. Performance obligations for all transactions are satisfied, and the corresponding revenue is recognized, at a distinct point in time when an ad renders. The Company does not have arrangements with multiple performance obligations. The Company reports revenue on a net basis as it does not act as the principal in the purchase and sale of digital advertising inventory because it does not have control of the digital advertising inventory and does not set prices agreed upon within the auction marketplace. The following table presents our revenue by channel for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 March 31, 2019 (in thousands, except percentages) Channel: Desktop $ 15,296 42 % $ 15,221 47 % Mobile 20,999 58 17,195 53 Total $ 36,295 100 % $ 32,416 100 % The following table presents our revenue disaggregated by geographic location, based on the location of the Company's sellers: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) United States $ 25,533 $ 21,486 International 10,762 10,930 Total $ 36,295 $ 32,416 Payment terms are specified in agreements between the Company and the buyers and sellers on its exchange platform. The Company generally bills buyers at the end of each month for the full purchase price of impressions filled in that month. The Company recognizes volume discounts as a reduction of revenue as they are incurred. Specific payment terms may vary by agreement, but are generally seventy-five days or less. The Company's accounts receivable are recorded at the amount of gross billings to buyers, net of allowances for the amounts the Company is responsible to collect. The Company's accounts payable related to amounts due to sellers are recorded at the net amount payable to sellers (see Note 5). Accordingly, both accounts receivable and accounts payable appear large in relation to revenue reported on a net basis. Accounts receivable are recorded at the invoiced amount, are unsecured, and do not bear interest. The allowance for doubtful accounts is reviewed quarterly, requires judgment, and is based on the best estimate of the amount of probable credit losses in existing accounts receivable. The Company reviews the status of the then-outstanding accounts receivable on a customer-by-customer basis, taking into consideration the aging schedule of receivables, its historical collection experience, current information regarding the client, subsequent collection history, and other relevant data, in establishing the allowance for doubtful accounts. Accounts receivable is presented net of an allowance for doubtful accounts of $3.1 million at March 31, 2020, and $3.4 million at December 31, 2019. Accounts receivable are written off against the allowance for uncollectible accounts when we determine amounts are no longer collectible. The Company reviews the associated payable to sellers for recovery of buyer receivable allowance and write-offs; in some cases, the Company can reduce the payable to sellers. The reduction of seller payables related to recovery of uncollected buyer receivables are netted against allowance expense. The contra seller payable related to recoveries were $1.0 million and $0.9 million as of March 31, 2020 and December 31, 2019, respectively. The following is a summary of activity in the allowance for credit losses for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Allowances for doubtful accounts, December 31 $ 3,400 $ 1,340 Write-offs (740 ) (30 ) Provision for expected credit loss 413 3,220 Recoveries of previous write-offs 7 — Allowances for doubtful accounts, March 31 $ 3,080 $ 4,530 During the three months ended March 31, 2020 , the provision for expected credit losses associated with accounts receivable of $0.4 million was offset by increases of contra seller payables related to recoveries of uncollected buyer receivables of $0.4 million, which resulted in immaterial bad debt expense during the period. During the three months ended March 31, 2019 , the provision for expected credit losses associated with accounts receivable of $3.2 million was offset by increases of contra seller payables related to recoveries of uncollected buyer receivables of $2.4 million, which resulted in bad debt expense during the period of $0.8 million. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Recurring Fair Value Measurements Fair value represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Observable inputs are based on market data obtained from independent sources. The fair value hierarchy is based on the following three levels of inputs, of which the first two are considered observable and the last one is considered unobservable: • Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. • Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3 – Unobservable inputs. The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at March 31, 2020 : Total Quoted Prices in Significant Other Significant (in thousands) Cash equivalents $ 3,540 $ 3,540 $ — $ — The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at December 31, 2019 : Total Quoted Prices in Significant Other Significant (in thousands) Cash equivalents $ 13,501 $ 13,501 $ — $ — At March 31, 2020 and December 31, 2019 , cash equivalents of $3.5 million and $13.5 million , respectively, consisted of money market funds and commercial paper, with original maturities of three months or less. The carrying amounts of cash equivalents are classified as Level 1 or Level 2 depending on whether or not their fair values are based on quoted market prices for identical securities that are traded in an active market. Corporate debt securities (which are included in marketable securities on the balance sheet) with fair values derived from similar securities rather than based on quoted market prices for identical securities, are classified as Level 2 as well. The fair values of the Company's U.S. treasury, government and agency debt securities are based on quoted market prices and classified as Level 1, and are included within marketable securities. |
Other Balance Sheet Amounts
Other Balance Sheet Amounts | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Other Balance Sheet Amounts | Other Balance Sheet Amounts Accounts payable and accrued expenses included the following: March 31, 2020 December 31, 2019 (in thousands) Accounts payable—seller $ 182,966 $ 247,891 Accounts payable—trade 5,798 4,822 Accrued employee-related payables 5,272 6,726 Total $ 194,036 $ 259,439 There was no restricted cash as of March 31, 2020 and December 31, 2019 . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The Company's goodwill balance as of March 31, 2020 and December 31, 2019 was $7.4 million . The Company’s intangible assets as of March 31, 2020 and December 31, 2019 included the following: March 31, 2020 December 31, 2019 (in thousands) Amortizable intangible assets: Developed technology $ 19,658 $ 19,658 Customer relationships 1,650 1,650 Non-compete agreements 70 70 Trademarks 20 20 Total identifiable intangible assets, gross 21,398 21,398 Accumulated amortization—intangible assets: Developed technology (10,669 ) (9,823 ) Customer relationships (368 ) (162 ) Non-compete agreements (16 ) (7 ) Trademarks (20 ) (20 ) Total accumulated amortization—intangible assets (11,073 ) (10,012 ) Total identifiable intangible assets, net $ 10,325 $ 11,386 Amortization of intangible assets for the three months ended March 31, 2020 and 2019 was $1.1 million and $0.8 million , respectively. The estimated remaining amortization expense associated with the Company's intangible assets was as follows as of March 31, 2020 : Fiscal Year Amount (in thousands) Remaining 2020 $ 3,181 2021 4,073 2022 2,068 2023 556 2024 447 Total $ 10,325 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company’s equity incentive plans provide for the grant of equity awards, including non-statutory or incentive stock options, restricted stock awards ("RSAs"), and restricted stock units ("RSUs"), to the Company's employees, officers, directors, and consultants. The Company's board of directors administers the plans. Outstanding options vest based upon continued service at varying rates, but generally over four years from issuance with 25% vesting after one year of service and the remainder vesting monthly thereafter. RSAs and RSUs vest at varying rates, typically approximately 25% vesting after approximately one year of service and the remainder vesting semi-annually thereafter, but with certain retention grants vesting 50% on each of the first and second anniversaries of the grant date. Restricted stock units granted in 2020 will typically have approximately 25% of the award vesting after approximately one year of service and the remainder vesting quarterly thereafter. Options, RSAs, and RSUs granted under the plans accelerate under certain circumstances for certain participants upon a change in control, as defined in the governing plan. An aggregate of 7,315,942 shares remained available for future grants at March 31, 2020 under the plans. Stock Options A summary of stock option activity for the three months ended March 31, 2020 is as follows: Shares Under Option Weighted- Average Exercise Price Weighted- Average Contractual Life Aggregate Intrinsic Value (in thousands) (in thousands) Outstanding at December 31, 2019 4,262 $ 6.82 Granted — $ — Exercised (27 ) $ 0.86 Expired (92 ) $ 12.84 Forfeited — $ — Outstanding at March 31, 2020 4,143 $ 6.73 6.80 years $ 3,788 Exercisable at March 31, 2020 2,732 $ 7.94 6.01 years $ 2,061 The total intrinsic values of options exercised during the three months ended March 31, 2020 was $0.2 million . At March 31, 2020 , the Company had unrecognized employee stock-based compensation expense relating to unvested stock options of approximately $3.5 million , which is expected to be recognized over a weighted-average period of 2.3 years . Total fair value of options vested during the three months ended March 31, 2020 was $1.2 million . The Company estimates the fair value of stock options that contain service and/or performance conditions using the Black-Scholes option pricing model. The weighted-average input assumptions used by the Company were as follows: Three Months Ended March 31, 2019 Expected term (in years) 6.1 Risk-free interest rate 2.51 % Expected volatility 60 % Dividend yield — % Restricted Stock Awards A summary of RSA activity for the three months ended March 31, 2020 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Unvested shares of restricted stock awards outstanding at December 31, 2019 2 $ 13.49 Granted — $ — Canceled — $ — Vested — $ — Unvested shares of restricted stock awards outstanding at March 31, 2020 2 $ 13.49 The unrecognized stock-based compensation expense for RSAs with service conditions at March 31, 2020 was insignificant. Restricted Stock Units A summary of RSU activity for the three months ended March 31, 2020 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Unvested restricted stock units outstanding at December 31, 2019 8,077 $ 4.46 Granted 49 $ 10.15 Canceled (82 ) $ 4.87 Vested (1,861 ) $ 3.02 Unvested restricted stock units outstanding at March 31, 2020 6,183 $ 4.93 The weighted-average grant date fair value per share of RSUs granted during the three months ended March 31, 2020 was $10.15 . The aggregate fair value of RSUs that vested during the three months ended March 31, 2020 was $19.4 million . At March 31, 2020 , the intrinsic value of unvested RSUs was $34.3 million . At March 31, 2020 , the Company had unrecognized stock-based compensation expense relating to unvested RSUs was approximately $22.5 million , which is expected to be recognized over a weighted-average period of 2.3 years . Employee Stock Purchase Plan In November 2013, the Company adopted the Company's 2014 Employee Stock Purchase Plan ("ESPP"). The ESPP is designed to enable eligible employees to periodically purchase shares of the Company's common stock at a discount through payroll deductions of up to 10% of their eligible compensation, subject to any plan limitations. At the end of each six-month offering period, employees are able to purchase shares at a price per share equal to 85% of the lower of the fair market value of the Company's common stock on the first trading day of the offering period or on the last trading day of the offering period. Offering periods generally commence and end in May and November of each year. As of March 31, 2020 , the Company has reserved 2,430,691 shares of its common stock for issuance under the ESPP. The ESPP has an evergreen provision pursuant to which the share reserve will automatically increase on January 1 st of each year in an amount equal to 1% of the total number of shares of capital stock outstanding on December 31 st of the preceding calendar year, although the Company’s board of directors may provide for a lesser increase, or no increase, in any year. Stock-Based Compensation Expense Total stock-based compensation expense recorded in the condensed consolidated statements of operations was as follows: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Cost of revenue $ 101 $ 92 Sales and marketing 1,085 1,345 Technology and development 1,183 1,059 General and administrative 1,688 1,873 Total stock-based compensation expense $ 4,057 $ 4,369 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In determining quarterly provisions for income taxes, the Company uses the annual estimated effective tax rate applied to the actual year-to-date income. The Company's annual estimated effective tax rate differs from the statutory rate primarily as a result of state taxes, foreign taxes, nondeductible stock option expenses, and changes in the Company's valuation allowance. The Company recorded an income tax benefit of $0.2 million and $0.7 million for the three months ended March 31, 2020 and 2019 , respectively. The tax benefit for the three months ended March 31, 2020 is primarily the result of the domestic valuation allowance, the tax liability associated with the foreign subsidiaries, and foreign stock-based compensation activity. On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act"), in response to the novel coronavirus pandemic. The CARES Act is meant to infuse negatively affected companies with various tax cash benefits to ease the impact of the novel coronavirus pandemic. The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer-side social security payments, and net operating loss carryback periods. The Company is currently evaluating the potential tax implications of the CARES Act. In addition, various foreign jurisdictions where the Company has activity have enacted or are considering enacting a variety of measures that could impact our tax liabilities. The Company is monitoring new legislation and evaluating the potential tax implications of these measures. Due to uncertainty as to the realization of benefits from the Company's domestic and certain international deferred tax assets, including net operating loss carryforwards and research and development tax credits, the Company has a full valuation allowance reserved against such assets. The Company intends to continue to maintain a full valuation allowance on the deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. Due to the net operating loss carryforwards, the Company's United States federal and a majority of its state returns are open to examination by the Internal Revenue Service and state jurisdictions for all years since inception. For Canada, the Netherlands, and the United Kingdom, all tax years remain open for examination by the local country tax authorities, for France only 2018 forward are open for examination, for Singapore 2017 and forward are open for examination, for Brazil 2016 and forward are open for examination, for Australia and Germany 2015 and forward are open for examination, and for Japan 2014 and forward remain open for examination. There were no material changes to the Company's unrecognized tax benefits in the three months ended March 31, 2020 , and the Company does not expect to have any significant changes to unrecognized tax benefits through the end of the fiscal year. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments As of March 31, 2020 and December 31, 2019 , the Company had $2.5 million of letters of credit associated with office leases available for borrowing, on which there were no outstanding borrowings as of either date. The Company also has operating lease agreements, discussed in more detail in Note 10. Guarantees and Indemnification The Company’s agreements with sellers, buyers, and other third parties typically obligate it to provide indemnity and defense for losses resulting from claims of intellectual property infringement, damages to property or persons, business losses, or other liabilities. Generally, these indemnity and defense obligations relate to the Company’s own business operations, obligations, and acts or omissions. However, under some circumstances, the Company agrees to indemnify and defend contract counterparties against losses resulting from their own business operations, obligations, and acts or omissions, or the business operations, obligations, and acts or omissions of third parties. For example, because the Company’s business interposes the Company between buyers and sellers in various ways, buyers often require the Company to indemnify them against acts and omissions of sellers, and sellers often require the Company to indemnify them against acts and omissions of buyers. In addition, the Company’s agreements with sellers, buyers, and other third parties typically include provisions limiting the Company’s liability to the counterparty, and the counterparty’s liability to the Company. These limits sometimes do not apply to certain liabilities, including indemnity obligations. These indemnity and limitation of liability provisions generally survive termination or expiration of the agreements in which they appear. The Company has also entered into indemnification agreements with its directors, executive officers, and certain other officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers, or employees. No material demands have been made upon the Company to provide indemnification under such agreements and there are no claims that the Company is aware of that could have a material effect on the Company’s condensed consolidated financial statements. Litigation The Company and its subsidiaries may from time to time be parties to legal or regulatory proceedings, lawsuits and other claims incident to their business activities and to the Company’s status as a public company. Such routine matters may include, among other things, assertions of contract breach or intellectual property infringement, claims for indemnity arising in the course of the Company’s business, regulatory investigations or enforcement proceedings, and claims by persons whose employment has been terminated. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. Consequently, management is unable to ascertain the ultimate aggregate amount of monetary liability, amounts which may be covered by insurance or recoverable from third parties, or the financial impact with respect to such matters as of March 31, 2020 . However, based on management’s knowledge as of March 31, 2020 , management believes that the final resolution of these matters known at such date, individually and in the aggregate, will not have a material adverse effect upon the Company’s condensed consolidated financial position, results of operations or cash flows. Between February 5 and March 16, 2020, nine lawsuits were filed by purported stockholders of Telaria in connection with the merger with The Rubicon Project, Inc. Two lawsuits were brought as putative class actions (captioned Sabatini v. Telaria, Inc., et al. and Carter v. Telaria, Inc., et al). Seven lawsuits were brought by the plaintiffs individually (captioned Stein v. Telaria, Inc., et al; Lin v. Telaria, Inc. et al; Melool v. Telaria, Inc., et al; Robinson v. Telaria, Inc., et al; Wu v. Telaria, Inc., et al; Yang v. Telaria, Inc., et al; and Corthell v Telaria, Inc. et al (collectively, the “Complaints”)). The Complaints name as defendants Telaria and each member of its Board of Directors. The Sabatini complaint additionally names Rubicon Project and Madison Merger Corp. (“Merger Sub”) as defendants. The Complaints allege violations of Section 14(a) of the Securities and Exchange Act of 1934 (the “Exchange Act”) and Rule 14a-9 promulgated thereunder against all defendants, and assert violations of Section 20(a) of the Exchange Act against the individual defendants. The Sabatini complaint additionally alleges a claim under Section 20(a) of the Exchange Act against Rubicon Project and Merger Sub. The Stein and Carter complaints additionally allege a violation of 17 C.F.R. § 244.100 against all defendants. The plaintiffs contend that Telaria’s Definitive Proxy Statement omitted or misrepresented material information regarding the Merger. The Complaints seek injunctive relief, rescission or rescissory damages, and an award of plaintiffs’ costs, including attorneys’ fees and expenses. The Lin and Sabatini complaints also seek dissemination of a proxy statement that discloses certain information requested by those plaintiffs. On March 23, 2020, Telaria and Rubicon Project filed supplemental disclosures to its Definitive Proxy Statement, mooting the Complaints. On March 24, 2020, plaintiffs in the Lin, Carter, Robinson, and Stein actions voluntarily dismissed their respective cases. On March 30, 2020, Telaria held a special meeting of its stockholders, at which Telaria’s stockholders approved the Merger. On April 20, 2020, plaintiff in the Sabatini action voluntarily dismissed his case. The Company believes the claims asserted in the remaining Complaints are without merit. Employment Contracts |
Lease Obligations
Lease Obligations | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease Obligations | Lease Obligations For the three months ended March 31, 2020 and 2019 , the Company recognized $ 2.1 million and $1.8 million , respectively, of lease expense under ASC 842, which included operating lease expenses associated with leases included in the lease liability and ROU asset on the condensed consolidated balance sheet. In addition, for the three months ended March 31, 2020 and 2019, the Company recognized $0.1 million and $0.2 million , respectively, of lease expense related to short-term leases and $2.4 million and $3.1 million of variable and cloud-based services related to data centers, respectively, that are not included in the ROU asset or lease liability balances. Rental income received for real estate leases for which it subleases the property to a third party were insignificant for the three months ended March 31, 2020 and 2019 . As of March 31, 2020 , a weighted average discount rate of 4.61% has been applied to the remaining lease payments to calculate the lease liabilities included within the condensed consolidated balance sheet. The maturity of the Company's lease liabilities were as follows (in thousands): Fiscal Year Remaining 2020 $ 6,025 2021 4,538 2022 2,429 2023 2,065 2024 1,610 Thereafter 6,881 Total lease payments (undiscounted) 23,548 Less: imputed interest (2,949 ) Lease liabilities—total (discounted) $ 20,599 In addition to the leases included in these condensed consolidated financial statements, the Company entered into a lease agreement for an office location in Milan, Italy during the quarter that has not yet commenced as of March 31, 2020 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt In September 2018, the Company amended and restated its loan and security agreement with Silicon Valley Bank ("SVB") (the "Loan Agreement"). The Loan Agreement provides a senior secured revolving credit facility of up to $40.0 million with a maturity date of September 26, 2020. As of March 31, 2020 , the amount available for borrowing was $40.0 million . The Company incurred $0.1 million of debt issuance fees that were capitalized and are being amortized over the term of the Loan Agreement. An unused revolver fee in the amount of 0.15% per annum of the average unused portion of the revolver line is charged and is payable monthly in arrears. The Company may elect for advances to bear interest calculated by reference to prime or LIBOR. If the Company elects LIBOR, amounts outstanding under the amended credit facility bear interest at a rate per annum equal to (a) LIBOR plus 2.50% if a streamline period applies or (b) LIBOR plus 4.00% if a streamline period does not apply. If the Company elects prime, advances bear interest at a rate of (a) prime plus 0.50% if a streamline period applies or (b) prime plus 2.00% if a streamline period does not apply. A streamline period is any period during which an event of default does not exist and the Company's Adjusted Quick Ratio (as defined in the Loan Agreement) is at least 1.05 for each day in the preceding month. The Loan Agreement is collateralized by security interests in substantially all of the Company's assets. Subject to certain exceptions, the Loan Agreement restricts the Company's ability to, among other things, pay dividends, sell assets, make changes to the nature of the business, engage in mergers or acquisitions, incur, assume or permit to exist, additional indebtedness and guarantees, create or permit to exist, liens, make distributions or redeem or repurchase capital stock, or make other investments, engage in transactions with affiliates, make payments with respect to subordinated debt, and enter into certain transactions without the consent of the financial institution. If a streamline period is not in effect, the Company is required to maintain a lockbox arrangement where clients' payments received in the lockbox will immediately reduce the amounts outstanding on the credit facility. The Loan Agreement requires the Company to comply with financial covenants, including a minimum Adjusted Quick Ratio and the achievement of certain Adjusted EBITDA targets. On a monthly basis, or quarterly if there were no advances outstanding during the calendar quarter, the Company is required to maintain a minimum Adjusted Quick Ratio of: (i) 1.00 if the trailing six month Adjusted EBITDA is $0 or less, or (ii) 0.90 if the trailing six month Adjusted EBITDA is greater than $0 . If the Company’s Adjusted Quick Ratio is 1.05 or greater, a streamline period applies. As of March 31, 2020 , the Company's Adjusted Quick Ratio was 1.13 , which is in compliance with its covenant requirement and is higher than the minimum Adjusted Quick Ratio required to qualify for a streamline period. The Company must also maintain the following trailing twelve month Adjusted EBITDA targets as of the end of each quarter as follows: (1) September 30, 2018 through June 30, 2019 Adjusted EBITDA must be within 20% of the Adjusted EBITDA projections that were delivered to Silicon Valley Bank; (2) September 30, 2019 Adjusted EBITDA of $1 or greater; and (3) December 31, 2019 and thereafter, Adjusted EBITDA of $5.0 million or greater. As of March 31, 2020 , the Company was in compliance with the Adjusted EBITDA covenant. The Loan Agreement also includes customary representations and warranties, affirmative covenants, and events of default, including events of default upon a change of control and material adverse change (as defined in the Loan Agreement). Following an event of default, SVB would be entitled to, among other things, accelerate payment of amounts due under the credit facility and exercise all rights of a secured creditor. As of March 31, 2020 , there were no amounts outstanding under the Loan Agreement. Future availability under the credit facility is dependent on several factors including the available borrowing base and compliance with future covenant requirements. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On April 1, 2020, the Company completed the stock-for-stock merger with Telaria, which created a combined company offering a single platform for transacting CTV, desktop display, video, audio, and mobile inventory across all geographies and auction types. Upon completion of the Merger, each share of Telaria common stock issued and outstanding was converted into 1.082 shares of Rubicon Project common stock. As a result, the Company issued 51,994,002 shares of Rubicon Project common stock. As part of the Merger, existing outstanding restricted stock units of Telaria common stock and stock options to purchase common stock of Telaria were exchanged for 1.082 restricted stock units of the Company and options to purchase the Company's common stock, respectively. The fair value of stock options exchanged on the date of the Merger attributable to pre-acquisition services will be recorded as purchase consideration. The fair value of the restricted stock units and stock options exchanged on the date of the Merger attributable to post-acquisition services will be recorded as additional stock-based compensation expense in the Company's consolidated statements of operations over their remaining requisite service (vesting) periods. The Company is currently evaluating the allocation of the purchase price to the acquired assets and assumed liabilities. It is not practicable to disclose the preliminary purchase price allocation or the unaudited combined financial information given the short period of time between the acquisition and the issuance of these unaudited interim condensed consolidated financial statements. On April 1, 2020, the Company granted 4,398,325 restricted stock units, 1,097,709 stock options, and 146,341 performance stock units to the Company's employees. The options granted will vest over four years from grant date, with 25% vesting after one year and the remainder vesting monthly thereafter. The RSUs granted will vest over four years from issuance with 25% after one year , and the remainder vesting quarterly thereafter, with the exception of 526,993 RSUs which vest 50% on each of the first and second anniversaries of the grant date, and 87,996 RSUs which will vest during the fourth quarter of 2020. Between 0% and 150% |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles, or GAAP, for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the results for the interim period presented have been included. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for any future interim period, the year ending December 31, 2020 , or for any future year. The condensed consolidated balance sheet at December 31, 2019 has been derived from the audited financial statements at that date, but does not include all of the disclosures required by GAAP. The accompanying condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto for the year ended December 31, 2019 included in its 2019 Annual Report on Form 10-K. There have been no significant changes in the Company's accounting policies from those disclosed in its audited consolidated financial statements and notes thereto for the year ended December 31, 2019 |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported and disclosed financial statements and accompanying footnotes. Due to the economic uncertainty as a result of the novel coronavirus pandemic, it has become more difficult to apply certain assumptions and judgments into these estimates. The extent of the impact of novel coronavirus pandemic on the Company's operational and financial performance will depend on certain developments, as discussed in more detail within Item 2. Management's Discussion and Analysis and Item 1A.Risk Factors. During the quarter ended March 31, 2020, this uncertainty resulted in a higher level of judgment related to its estimates and assumptions. As of the date of issuance of the condensed consolidated financial statements for the three months ended March, 31, 2020, the Company is not aware of any specific event or circumstance that would require us to update our estimates, judgments, or revise the carrying value of our assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company's financial statements. |
Recently Adopted and Recent Accounting Pronouncements | Recently Adopted Accounting Standards In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13— Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (" ASU 2016-13"). This guidance requires entities to use a current expected credit loss methodology to measure impairments of certain financial assets and to recognize an allowance for its estimate of lifetime expected credit losses. The main objective of this update is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The guidance was effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted ASU 2016-13 as of January 1, 2020. The standard had no material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13— Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"), to streamline the disclosure requirements of ASC Topic 820—Fair Value Measurement. ASU 2018 removes certain disclosure requirements, including the valuation process for Level 3 fair value measurements, and adds certain quantitative disclosures around Level 3 fair value measurements. This ASU is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, with early adoption permitted. The provisions of ASU 2018-13 are required to be adopted retrospectively, with the exception of disclosure of the range and weighted average of significant unobservable inputs used to develop Level 3 measurements, which can be adopted prospectively. The Company adopted ASU 2018-13 as of January 1, 2020. The standard had no material impact on its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15— Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). ASU 2018-15 was issued to clarify the requirements of ASC 350-40— Intangibles—Goodwill and Other—Internal-Use Software ("ASC 350-40"). The ASU clarifies that implementation, setup and other upfront costs related to cloud computing agreements ("CCA") should be accounted for under ASC 350-40. ASC 2018-15 will require companies to capitalize certain costs incurred when purchasing a CCA that is a service. Under the new guidance, companies will apply the same criteria for capitalizing implementation costs in a CCA service as they would for internal-use software. The capitalized implementation costs will generally be expensed over the term of the service arrangement and the related assets will be assessed for impairment using the same model applied to long-lived assets. This ASU is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, with early adoption permitted. ASU 2018-15 can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company adopted ASU 2018-15 as of January 1, 2020 on a prospective basis. The standard had no material impact on its consolidated financial statements and related disclosures. Recent Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12— Simplifying the Accounting for Income Taxes ("ASU 2019-12") . ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to general principles in Topic 740 and clarifies and amends existing guidance for clarity and consistent application. This guidance is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020 including interim reporting periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact of adopting this new accounting guidance on its consolidated financial statements and related disclosures. |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Net Loss Per Share, Basic and Diluted | The following table presents the basic and diluted net loss per share: Three Months Ended March 31, 2020 March 31, 2019 (in thousands, except per share data) Basic and Diluted EPS: Net loss $ (9,675 ) $ (12,546 ) Weighted-average common shares outstanding 54,868 51,635 Weighted-average unvested restricted stock (2 ) (58 ) Weighted-average common shares outstanding used to compute net loss per share 54,866 51,577 Basic and diluted net loss per share $ (0.18 ) $ (0.24 ) |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following weighted-average shares have been excluded from the calculation of diluted net loss per share attributable to common stockholders for each period presented because they are anti-dilutive: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Options to purchase common stock 1,239 513 Unvested restricted stock awards 1 44 Unvested restricted stock units 3,978 2,746 ESPP 61 28 Total shares excluded from net loss per share 5,279 3,331 |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following table presents our revenue by channel for the three months ended March 31, 2020 and 2019 : Three Months Ended March 31, 2020 March 31, 2019 (in thousands, except percentages) Channel: Desktop $ 15,296 42 % $ 15,221 47 % Mobile 20,999 58 17,195 53 Total $ 36,295 100 % $ 32,416 100 % The following table presents our revenue disaggregated by geographic location, based on the location of the Company's sellers: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) United States $ 25,533 $ 21,486 International 10,762 10,930 Total $ 36,295 $ 32,416 |
Accounts Receivable, Allowance for Credit Loss | The following is a summary of activity in the allowance for credit losses for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Allowances for doubtful accounts, December 31 $ 3,400 $ 1,340 Write-offs (740 ) (30 ) Provision for expected credit loss 413 3,220 Recoveries of previous write-offs 7 — Allowances for doubtful accounts, March 31 $ 3,080 $ 4,530 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis | The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at March 31, 2020 : Total Quoted Prices in Significant Other Significant (in thousands) Cash equivalents $ 3,540 $ 3,540 $ — $ — The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at December 31, 2019 : Total Quoted Prices in Significant Other Significant (in thousands) Cash equivalents $ 13,501 $ 13,501 $ — $ — |
Other Balance Sheet Amounts (Ta
Other Balance Sheet Amounts (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses included the following: March 31, 2020 December 31, 2019 (in thousands) Accounts payable—seller $ 182,966 $ 247,891 Accounts payable—trade 5,798 4,822 Accrued employee-related payables 5,272 6,726 Total $ 194,036 $ 259,439 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The Company’s intangible assets as of March 31, 2020 and December 31, 2019 included the following: March 31, 2020 December 31, 2019 (in thousands) Amortizable intangible assets: Developed technology $ 19,658 $ 19,658 Customer relationships 1,650 1,650 Non-compete agreements 70 70 Trademarks 20 20 Total identifiable intangible assets, gross 21,398 21,398 Accumulated amortization—intangible assets: Developed technology (10,669 ) (9,823 ) Customer relationships (368 ) (162 ) Non-compete agreements (16 ) (7 ) Trademarks (20 ) (20 ) Total accumulated amortization—intangible assets (11,073 ) (10,012 ) Total identifiable intangible assets, net $ 10,325 $ 11,386 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated remaining amortization expense associated with the Company's intangible assets was as follows as of March 31, 2020 : Fiscal Year Amount (in thousands) Remaining 2020 $ 3,181 2021 4,073 2022 2,068 2023 556 2024 447 Total $ 10,325 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of stock option activity for the three months ended March 31, 2020 is as follows: Shares Under Option Weighted- Average Exercise Price Weighted- Average Contractual Life Aggregate Intrinsic Value (in thousands) (in thousands) Outstanding at December 31, 2019 4,262 $ 6.82 Granted — $ — Exercised (27 ) $ 0.86 Expired (92 ) $ 12.84 Forfeited — $ — Outstanding at March 31, 2020 4,143 $ 6.73 6.80 years $ 3,788 Exercisable at March 31, 2020 2,732 $ 7.94 6.01 years $ 2,061 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company estimates the fair value of stock options that contain service and/or performance conditions using the Black-Scholes option pricing model. The weighted-average input assumptions used by the Company were as follows: Three Months Ended March 31, 2019 Expected term (in years) 6.1 Risk-free interest rate 2.51 % Expected volatility 60 % Dividend yield — % |
Nonvested Restricted Stock Shares Activity | A summary of RSA activity for the three months ended March 31, 2020 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Unvested shares of restricted stock awards outstanding at December 31, 2019 2 $ 13.49 Granted — $ — Canceled — $ — Vested — $ — Unvested shares of restricted stock awards outstanding at March 31, 2020 2 $ 13.49 |
Schedule of Nonvested Restricted Stock Units Activity | A summary of RSU activity for the three months ended March 31, 2020 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Unvested restricted stock units outstanding at December 31, 2019 8,077 $ 4.46 Granted 49 $ 10.15 Canceled (82 ) $ 4.87 Vested (1,861 ) $ 3.02 Unvested restricted stock units outstanding at March 31, 2020 6,183 $ 4.93 |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs for all Plans | Total stock-based compensation expense recorded in the condensed consolidated statements of operations was as follows: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Cost of revenue $ 101 $ 92 Sales and marketing 1,085 1,345 Technology and development 1,183 1,059 General and administrative 1,688 1,873 Total stock-based compensation expense $ 4,057 $ 4,369 |
Lease Obligations (Tables)
Lease Obligations (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Maturity of Lease Liabilities | The maturity of the Company's lease liabilities were as follows (in thousands): Fiscal Year Remaining 2020 $ 6,025 2021 4,538 2022 2,429 2023 2,065 2024 1,610 Thereafter 6,881 Total lease payments (undiscounted) 23,548 Less: imputed interest (2,949 ) Lease liabilities—total (discounted) $ 20,599 |
Net Income (Loss) Per Share - B
Net Income (Loss) Per Share - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Basic and Diluted EPS: | ||
Net loss | $ (9,675) | $ (12,546) |
Weighted-average common shares outstanding | 54,868 | 51,635 |
Weighted-average unvested restricted stock (in shares) | (2) | (58) |
Weighted-average common shares outstanding used to compute net loss per share | 54,866 | 51,577 |
Basic and diluted net loss per share (usd per share) | $ (0.18) | $ (0.24) |
Net Income (Loss) Per Share - S
Net Income (Loss) Per Share - Shares Excluded From Calculation of Diluted Net Loss Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares excluded from net loss per share (in shares) | 5,279 | 3,331 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares excluded from net loss per share (in shares) | 1,239 | 513 |
Unvested restricted stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares excluded from net loss per share (in shares) | 1 | 44 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares excluded from net loss per share (in shares) | 3,978 | 2,746 |
ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total shares excluded from net loss per share (in shares) | 61 | 28 |
Revenues - Revenue Disaggregate
Revenues - Revenue Disaggregated by Sales Distribution Channel (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 36,295 | $ 32,416 |
Concentration risk, percentage | 100.00% | 100.00% |
Desktop | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 15,296 | $ 15,221 |
Concentration risk, percentage | 42.00% | 47.00% |
Mobile | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 20,999 | $ 17,195 |
Concentration risk, percentage | 58.00% | 53.00% |
Revenues - Revenue Disaggrega_2
Revenues - Revenue Disaggregated by Geographic Location (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 36,295 | $ 32,416 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 25,533 | 21,486 |
International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 10,762 | $ 10,930 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | ||||
Payment terms | 75 days | |||
Accounts receivable, allowance for credit loss | $ 3,080 | $ 4,530 | $ 3,400 | $ 1,340 |
Contra seller payable | 1,000 | $ 900 | ||
Provision for doubtful accounts | 413 | 3,220 | ||
Increase in contra seller payable | 400 | 2,400 | ||
Provision for doubtful accounts | $ 2 | $ 775 |
Revenues - Schedule of Allowanc
Revenues - Schedule of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Allowances for doubtful accounts, beginning balance | $ 3,400 | $ 1,340 |
Write-offs | (740) | (30) |
Provision for expected credit loss | 413 | 3,220 |
Recoveries of previous write-offs | 7 | 0 |
Allowances for doubtful accounts, ending balance | $ 3,080 | $ 4,530 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 3,540 | $ 13,501 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 3,540 | 13,501 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - Recurring - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 3,540 | $ 13,501 |
Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 3,500 | $ 13,500 |
Other Balance Sheet Amounts - N
Other Balance Sheet Amounts - Narrative (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Restricted cash | $ 0 | $ 0 |
Other Balance Sheet Amounts - A
Other Balance Sheet Amounts - Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts payable—seller | $ 182,966 | $ 247,891 |
Accounts payable—trade | 5,798 | 4,822 |
Accrued employee-related payables | 5,272 | 6,726 |
Total | $ 194,036 | $ 259,439 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 7,370 | $ 7,370 | |
Amortization expense of intangible assets | $ 1,100 | $ 800 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Total identifiable intangible assets, gross | $ 21,398 | $ 21,398 |
Total accumulated amortization—intangible assets | (11,073) | (10,012) |
Total | 10,325 | 11,386 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identifiable intangible assets, gross | 19,658 | 19,658 |
Total accumulated amortization—intangible assets | (10,669) | (9,823) |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identifiable intangible assets, gross | 1,650 | 1,650 |
Total accumulated amortization—intangible assets | (368) | (162) |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identifiable intangible assets, gross | 70 | 70 |
Total accumulated amortization—intangible assets | (16) | (7) |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identifiable intangible assets, gross | 20 | 20 |
Total accumulated amortization—intangible assets | $ (20) | $ (20) |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Finite-Lived Intangible Assets, Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fiscal Year | ||
Remaining 2020 | $ 3,181 | |
2021 | 4,073 | |
2022 | 2,068 | |
2023 | 556 | |
2024 | 447 | |
Total | $ 10,325 | $ 11,386 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) | 3 Months Ended |
Mar. 31, 2020shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares available for grant | 7,315,942 |
Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 4 years |
Stock Option | Vesting After One Year of Service | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
RSAs and RSUs | Vesting After One Year of Service | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 25.00% |
RSAs and RSUs | Vesting on First and Second Anniversary | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights, percentage | 50.00% |
Restricted Stock Units (RSUs) | Vesting After One Year of Service | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 1 year |
Award vesting rights, percentage | 25.00% |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options Outstanding (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Shares Under Option | |
Beginning balance (in shares) | shares | 4,262 |
Granted (in shares) | shares | 0 |
Exercised (in shares) | shares | (27) |
Expired (in shares) | shares | (92) |
Forfeited (in shares) | shares | 0 |
Ending balance (in shares) | shares | 4,143 |
Exercisable (in shares) | shares | 2,732 |
Weighted- Average Exercise Price | |
Beginning balance (usd per share) | $ / shares | $ 6.82 |
Granted (usd per share) | $ / shares | 0 |
Exercised (usd per share) | $ / shares | 0.86 |
Expired (usd per share) | $ / shares | 12.84 |
Forfeited (usd per share) | $ / shares | 0 |
Ending balance (usd per share) | $ / shares | 6.73 |
Exercisable (usd per share) | $ / shares | $ 7.94 |
Weighted- Average Contractual Life | |
Outstanding | 6 years 9 months 18 days |
Exercisable | 6 years 3 days |
Aggregate Intrinsic Value | |
Outstanding | $ | $ 3,788 |
Exercisable | $ | $ 2,061 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock Options Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Number of Shares | |
Intrinsic values of options exercised | $ 0.2 |
Unrecognized employee stock-based compensation | 3.5 |
Fair value of options vested in period | $ 1.2 |
Stock Option | |
Number of Shares | |
Unrecognized employee stock-based compensation, period for recognition | 2 years 3 months 18 days |
Stock-Based Compensation - Valu
Stock-Based Compensation - Valuation Assumptions (Details) - Stock Option | 3 Months Ended |
Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 6 years 1 month 6 days |
Risk-free interest rate | 2.51% |
Expected volatility | 60.00% |
Dividend yield | 0.00% |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Activity (Details) - Unvested restricted stock awards shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Number of Shares | |
Beginning balance (in shares) | shares | 2 |
Granted (in shares) | shares | 0 |
Canceled (in shares) | shares | 0 |
Vested (in shares) | shares | 0 |
Ending balance (in shares) | shares | 2 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 13.49 |
Granted (in dollars per share) | $ / shares | 0 |
Canceled (in dollars per share) | $ / shares | 0 |
Vested (in dollars per share) | $ / shares | 0 |
Ending balance (in dollars per share) | $ / shares | $ 13.49 |
Stock-Based Compensation - Re_2
Stock-Based Compensation - Restricted Stock Units Activity (Details) - Restricted Stock Units (RSUs) shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Number of Shares | |
Beginning balance (in shares) | shares | 8,077 |
Granted (in shares) | shares | 49 |
Canceled (in shares) | shares | (82) |
Vested (in shares) | shares | (1,861) |
Ending balance (in shares) | shares | 6,183 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 4.46 |
Granted (in dollars per share) | $ / shares | 10.15 |
Canceled (in dollars per share) | $ / shares | 4.87 |
Vested (in dollars per share) | $ / shares | 3.02 |
Ending balance (in dollars per share) | $ / shares | $ 4.93 |
Stock-Based Compensation - Re_3
Stock-Based Compensation - Restricted Stock Units Narrative (Details) - Restricted Stock Units (RSUs) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (in dollars per share) | $ / shares | $ 10.15 |
Fair value of restricted stock vested | $ 19.4 |
Intrinsic value of nonvested unit | 34.3 |
Unrecognized employee stock-based compensation | $ 22.5 |
Unrecognized employee stock-based compensation, weighted average period | 2 years 3 months 18 days |
Stock-Based Compensation - Empl
Stock-Based Compensation - Employee Stock Purchase Plan Narrative (Details) - shares | 1 Months Ended | 3 Months Ended |
Nov. 30, 2013 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares reserved | 7,315,942 | |
Employee Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Annual percentage increase | 1.00% | |
2014 Employee Stock Purchase Plan | Employee Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Maximum employee subscription rate | 10.00% | |
Offering period | 6 months | |
Purchase price of common stock, percent | 85.00% | |
Number of shares reserved | 2,430,691 |
Stock-Based Compensation - St_3
Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 4,057 | $ 4,369 |
Cost of revenue | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 101 | 92 |
Sales and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 1,085 | 1,345 |
Technology and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 1,183 | 1,059 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 1,688 | $ 1,873 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Provision (benefit) for income taxes | $ (201) | $ (708) |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 1 Months Ended | ||
Mar. 16, 2020lawsuit | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Other Commitments [Line Items] | |||
Number of lawsuits filed | 9 | ||
Sabatini and Carter Versus Telaria and Others | |||
Other Commitments [Line Items] | |||
Number of lawsuits brought by plaintiffs individually | 2 | ||
The Complaints Versus Telaria and Others | |||
Other Commitments [Line Items] | |||
Number of lawsuits brought by plaintiffs collectively | 7 | ||
Financial Standby Letter of Credit | |||
Other Commitments [Line Items] | |||
Letters of credit outstanding, amount | $ | $ 2.5 | $ 2.5 |
Lease Obligations - Narrative (
Lease Obligations - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Lease expense | $ 2.1 | $ 1.8 | |
Short-term lease expense | $ 0.1 | $ 0.2 | |
Weighted average discount rate | 4.61% | ||
Data centers for cloud-based services | |||
Lessee, Lease, Description [Line Items] | |||
Variable lease cost | $ 2.4 | ||
Lease cost | $ 3.1 |
Lease Obligations - Schedule of
Lease Obligations - Schedule of Lease Liability Maturities (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Fiscal Year | |
Remaining 2020 | $ 6,025 |
2021 | 4,538 |
2022 | 2,429 |
2023 | 2,065 |
2024 | 1,610 |
Thereafter | 6,881 |
Total lease payments (undiscounted) | 23,548 |
Less: imputed interest | (2,949) |
Lease liabilities—total (discounted) | $ 20,599 |
Debt (Details)
Debt (Details) | Sep. 26, 2018USD ($) | Mar. 31, 2020USD ($) |
Debt Instrument [Line Items] | ||
Adjusted Quick Ratio | 1.13 | |
Revolving Credit Facility | Loan Agreement | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 40,000,000 | |
Available borrowing capacity | $ 40,000,000 | |
Capitalized debt issuance costs | $ 100,000 | |
Unused capacity fee, percentage | 0.15% | |
Adjusted Quick Ratio, in streamline period | 1.05 | |
Debt outstanding amount | $ 0 | |
Revolving Credit Facility | Loan Agreement | Covenant Compliance Period One | ||
Debt Instrument [Line Items] | ||
Adjusted EBITDA threshold | 0.20 | |
Revolving Credit Facility | Loan Agreement | Covenant Compliance Period Two | ||
Debt Instrument [Line Items] | ||
Adjusted EBITDA minimum | $ 1 | |
Revolving Credit Facility | Loan Agreement | Covenant Compliance Period Three | ||
Debt Instrument [Line Items] | ||
Adjusted EBITDA minimum | $ 5,000,000 | |
Revolving Credit Facility | Loan Agreement | Streamline Period Applies | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 2.50% | |
Revolving Credit Facility | Loan Agreement | Streamline Period Applies | Prime Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 0.50% | |
Revolving Credit Facility | Loan Agreement | Streamline Period Does Not Apply | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 4.00% | |
Revolving Credit Facility | Loan Agreement | Streamline Period Does Not Apply | Prime Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 2.00% | |
Revolving Credit Facility | Loan Agreement | Covenant Term, Scenario One | ||
Debt Instrument [Line Items] | ||
Adjusted EBITDA maximum | $ 0 | |
Adjusted Quick Ratio | 1 | |
Revolving Credit Facility | Loan Agreement | Covenant Term, Scenario Two | ||
Debt Instrument [Line Items] | ||
Adjusted Quick Ratio | 0.90 | |
Adjusted EBITDA minimum | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - shares | Apr. 01, 2020 | Mar. 31, 2020 |
Subsequent Event [Line Items] | ||
Granted options (in shares) | 0 | |
Subsequent Events | ||
Subsequent Event [Line Items] | ||
Granted options (in shares) | 1,097,709 | |
Subsequent Events | Telaria | ||
Subsequent Event [Line Items] | ||
Common stock, shares, issued and outstanding (in shares) | 1.082 | |
Issued in merger (in shares) | 51,994,002 | |
Stock Option | ||
Subsequent Event [Line Items] | ||
Vesting period | 4 years | |
Stock Option | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Vesting period | 4 years | |
Restricted Stock Units (RSUs) | ||
Subsequent Event [Line Items] | ||
Granted (in shares) | 49,000 | |
Vested (in shares) | 1,861,000 | |
Restricted Stock Units (RSUs) | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Granted (in shares) | 4,398,325 | |
Vesting period | 4 years | |
Performance Shares | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Granted (in shares) | 146,341 | |
Vesting After One Year of Service | Stock Option | ||
Subsequent Event [Line Items] | ||
Award vesting rights, percentage | 25.00% | |
Vesting After One Year of Service | Stock Option | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Vesting period | 1 year | |
Award vesting rights, percentage | 25.00% | |
Vesting After One Year of Service | Restricted Stock Units (RSUs) | ||
Subsequent Event [Line Items] | ||
Vesting period | 1 year | |
Award vesting rights, percentage | 25.00% | |
Vesting After One Year of Service | Restricted Stock Units (RSUs) | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Vesting period | 1 year | |
Award vesting rights, percentage | 25.00% | |
Vesting on First and Second Anniversary | Restricted Stock Units (RSUs) | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Award vesting rights, percentage | 50.00% | |
Vested (in shares) | 526,993 | |
Vesting during fourth quarter | Restricted Stock Units (RSUs) | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Vested (in shares) | 87,996 | |
Minimum | Vesting on third anniversary | Performance Shares | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Award vesting rights, percentage | 0.00% | |
Maximum | Vesting on third anniversary | Performance Shares | Subsequent Events | ||
Subsequent Event [Line Items] | ||
Award vesting rights, percentage | 150.00% |