Comscore reports first quarter 2022 results
Reston, va.--(business wire)--comscore, inc. (nasdaq: scor), a trusted partner for planning, transacting, and evaluating media across platforms, today reported financial results for the quarter ended march 31, 2022. q1 2022 financial highlights revenue for the first quarter was $94.0 million compared to $90.3 million in q1 2021 tv measurement grew double digits year over year on new business wins and renewals with long-standing partners activation up 20% year over year as our privacy-forward solutions are beginning to scale net loss of $9.3 million compared to a net loss of $36.4 million in q1 2021 adjusted ebitda of $6.8 million compared to $5.6 million in q1 2021 recent business developments cross platform solutions mrc audit for local and national television measurement is underway new national tv business wins with warner bros. discovery and paramount global warner bros. discovery considers comscore as an alternative currency provider with multiple national agencies nbcu certifies comscore for local currency measurement, nbcu's only certified local provider comcast cable's ad sales division effectv announces comscore as a currency for its local markets sinclair becomes first tv group to subscribe to a multiyear contract with comscore's consumer intelligence (cci) for local markets expanded relationship with wideorbit to include comscore as a new currency for its local markets, with automated tv buying and selling across 1700 stations in all 210 markets digital ad solutions renewed partnership with iri to add custom cpg segments to comscore's growing activation suite of privacy-forward product offerings tremor international partners with comscore's cookie-free predictive audiences to pre-bid audience targeting across desktop, mobile and connected tv (ctv) new business with redfin and webmd ccr engagement with nbcu and warner bros. discovery "this was another solid quarter of year-over-year growth for comscore. i am proud of the progress we are making across all our lines of business. as the measurement landscape evolves, comscore remains focused on delivering superior products that drive the best outcomes for our clients. throughout the quarter we continued to sign new clients and renewed long-standing currency relationships with industry-leading companies. there continues to be a tremendous opportunity for comscore as it positions itself as the leading cross-platform currency, which we expect will continue to drive revenue growth throughout 2022," said bill livek, ceo and executive vice chairman of comscore. first quarter summary results revenue in the first quarter was $94.0 million, up 4% from $90.3 million in q1 2021, with growth from increases in tv, movies, custom solutions, and activation partially offset by lower revenue from services related to our international digital measurement offering. expenses from cost of revenues, sales and marketing, research and development and general and administrative were $97.7 million, up 2.5% from $95.4 million in q1 2021. net loss for the quarter was $9.3 million, compared to net loss of $36.4 million in q1 2021. included in net loss for q1 2021 was a $15.3 million non-cash charge related to the recapitalization transaction that closed in march 2021. after accounting for dividends on our convertible preferred stock, loss per share attributable to common shares was $(0.14), compared to a loss per share of $(0.49) in q1 2021. adjusted ebitda for the quarter was $6.8 million, compared to $5.6 million in q1 2021, resulting in adjusted ebitda margins of 7% and 6%, respectively. adjusted ebitda and adjusted ebitda margin exclude stock-based compensation, change in fair value of contingent consideration, financing derivatives and warrants liability, debt extinguishment costs, amortization of cloud-computing implementation costs, and other items as presented in the accompanying tables. balance sheet and liquidity as of march 31, 2022, cash, cash equivalents and restricted cash totaled $30.1 million. total debt principal, including $16.0 million in outstanding borrowings under our senior secured revolving credit agreement, was $20.5 million. 2022 outlook based on current trends and expectations, we continue to believe that revenue will increase mid to high single digits over 2021 and expect the adjusted ebitda margin to be consistent with 2021. conference call information for today, tuesday, may 10, 2022 at 5:00 p.m. et management will provide commentary on the company's results in a conference call on tuesday, may 10, 2022 at 5:00 p.m. et. to access this call, dial +1 844-229-7593 (u.s. and canada) or +1 314-888-4258 (international) and reference conference id # 9990618. participants are advised to dial in at least 10 minutes prior to the call to register. additionally, a live webcast of the conference call will be available on the investor relations section of the company's website at ir.comscore.com/events-presentations. following the conference call, a replay will be available by dialing +1 855-859-2056 (u.s. and canada) or +1 404-537-3406 (international) with conference id #9990618. the replay will also be available via webcast at ir.comscore.com/events-presentations. about comscore comscore is a trusted partner for planning, transacting and evaluating media across platforms. with a data footprint that combines digital, linear tv, over-the-top and theatrical viewership intelligence with advanced audience insights, comscore allows media buyers and sellers to quantify their multiscreen behavior and make business decisions with confidence. a proven leader in measuring digital and tv audiences and advertising at scale, comscore is the industry's emerging, third-party source for reliable and comprehensive cross-platform measurement. cautionary note regarding forward-looking statements this press release contains forward-looking statements within the meaning of federal and state securities laws, including, without limitation, our expectations, forecasts, plans and opinions regarding expected revenue growth and adjusted ebitda margin for future periods, the impact of new customer contracts and partnerships on our business and revenue prospects, evolving industry trends, comscore's currency opportunities, and product development and innovation. these statements involve risks and uncertainties that could cause actual events to differ materially from expectations, including, but not limited to, changes in our business and customer, partner and vendor relationships; external market conditions and competition; evolving privacy and regulatory standards; the continuing impact of the covid-19 pandemic and related government mandates; and our ability to achieve our expected strategic, financial and operational plans. for additional discussion of risk factors, please refer to our annual reports on form 10-k, quarterly reports on form 10-q, and other filings that we make from time to time with the u.s. securities and exchange commission (the "sec"), which are available on the sec's website (www.sec.gov). investors are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. we do not intend or undertake, and expressly disclaim, any duty or obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after the date of this press release, or to reflect the occurrence of unanticipated events. use of non-gaap financial measures to provide investors with additional information regarding our financial results, we are disclosing herein adjusted ebitda and adjusted ebitda margin, which are non-gaap financial measures used by our management to understand and evaluate our core operating performance and trends. we believe that these non-gaap financial measures provide useful information to investors and others in understanding and evaluating our operating results, as they permit our investors to view our core business performance using the same metrics that management uses to evaluate our performance. nevertheless, our use of these non-gaap financial measures has limitations as an analytical tool, and investors should not consider these measures in isolation or as a substitute for analysis of our results as reported under gaap. instead, you should consider these measures alongside gaap-based financial performance measures, net loss, various cash flow metrics, and our other gaap financial results. set forth below are reconciliations of these non-gaap financial measures to their most directly comparable gaap financial measure, net loss. these reconciliations should be carefully evaluated. comscore, inc. condensed consolidated balance sheets as of as of march 31, 2022 december 31, 2021 (in thousands, except share and par value data) (unaudited) assets current assets: cash and cash equivalents $ 29,629 $ 21,854 restricted cash 425 425 accounts receivable, net of allowances of $972 and $1,173, respectively 64,618 72,059 prepaid expenses and other current assets 14,378 14,769 total current assets 109,050 109,107 property and equipment, net 35,600 36,451 operating right-of-use assets 27,744 29,186 deferred tax assets 3,173 2,811 intangible assets, net 33,166 39,945 goodwill 435,473 435,711 other non-current assets 11,507 10,263 total assets $ 655,713 $ 663,474 liabilities, convertible redeemable preferred stock and stockholders' equity current liabilities: accounts payable $ 29,124 $ 23,575 accrued expenses 38,393 45,264 contract liability 58,563 54,011 customer advances 10,933 11,613 warrants liability 8,085 10,520 current operating lease liabilities 7,579 7,538 other current liabilities 18,251 12,850 total current liabilities 170,928 165,371 non-current operating lease liabilities 34,238 36,055 non-current portion of accrued data costs 18,195 16,005 revolving line of credit 16,000 16,000 deferred tax liabilities 2,762 2,103 other non-current liabilities 12,445 16,879 total liabilities 254,568 252,413 commitments and contingencies convertible redeemable preferred stock, $0.001 par value; 82,527,609 shares authorized, issued and outstanding as of march 31, 2022 and december 31, 2021; aggregate liquidation preference of $215,688 as of march 31, 2022, and $211,863 as of december 31, 2021 187,885 187,885 stockholders' equity: preferred stock, $0.001 par value; 7,472,391 shares authorized as of march 31, 2022 and december 31, 2021, respectively; no shares issued or outstanding as of march 31, 2022 or december 31, 2021 — — common stock, $0.001 par value; 275,000,000 shares authorized as of march 31, 2022 and december 31, 2021; 97,470,138 shares issued and 90,705,342 shares outstanding as of march 31, 2022, and 97,172,086 shares issued and 90,407,290 shares outstanding as of december 31, 2021 91 90 additional paid-in capital 1,687,608 1,683,883 accumulated other comprehensive loss (12,639 ) (12,098 ) accumulated deficit (1,231,816 ) (1,218,715 ) treasury stock, at cost, 6,764,796 shares as of march 31, 2022 and december 31, 2021 (229,984 ) (229,984 ) total stockholders' equity 213,260 223,176 total liabilities, convertible redeemable preferred stock and stockholders' equity $ 655,713 $ 663,474 comscore, inc. condensed consolidated statements of operations and comprehensive loss (unaudited) three months ended march 31, (in thousands, except share and per share data) 2022 2021 revenues $ 93,966 $ 90,330 cost of revenues (1) (2) 52,918 52,702 selling and marketing (1) (2) 17,166 17,827 research and development (1) (2) 9,532 10,353 general and administrative (1) (2) 18,117 14,468 amortization of intangible assets 6,779 6,439 total expenses from operations 104,512 101,789 loss from operations (10,546 ) (11,459 ) other income (expense), net 2,433 (8,274 ) gain from foreign currency transactions 420 1,074 interest expense, net (200 ) (7,045 ) loss on extinguishment of debt — (9,629 ) loss before income taxes (7,893 ) (35,333 ) income tax provision (1,383 ) (1,022 ) net loss $ (9,276 ) $ (36,355 ) net loss available to common stockholders net loss $ (9,276 ) $ (36,355 ) convertible redeemable preferred stock dividends (3,825 ) (935 ) total net loss available to common stockholders $ (13,101 ) $ (37,290 ) net loss per common share: basic and diluted $ (0.14 ) $ (0.49 ) weighted-average number of shares used in per share calculation - common stock: basic and diluted 91,686,733 76,147,342 comprehensive loss: net loss $ (9,276 ) $ (36,355 ) other comprehensive loss: foreign currency cumulative translation adjustment (541 ) (2,151 ) total comprehensive loss $ (9,817 ) $ (38,506 ) (1) excludes amortization of intangible assets, which is presented separately in the consolidated statements of operations and comprehensive loss. (2) stock-based compensation expense is included in the line items above as follows: three months ended march 31, 2022 2021 cost of revenues $ 301 $ 855 selling and marketing 263 955 research and development 200 642 general and administrative 1,772 2,485 total stock-based compensation expense $ 2,536 $ 4,937 comscore, inc. condensed consolidated statements of cash flows (unaudited) three months ended march 31, (in thousands) 2022 2021 operating activities: net loss $ (9,276 ) $ (36,355 ) adjustments to reconcile net loss to net cash provided by operating activities: amortization of intangible assets 6,779 6,439 depreciation 4,191 4,054 stock-based compensation expense 2,536 4,937 change in fair value of contingent consideration liability 2,348 — non-cash operating lease expense 1,483 1,262 amortization expense of finance leases 704 443 deferred tax provision 513 638 change in fair value of warrants liability (2,435 ) 10,001 loss on extinguishment of debt — 9,629 non-cash interest expense on senior secured convertible notes — 4,692 other 469 260 changes in operating assets and liabilities, net of effect of acquisition: accounts receivable 7,301 7,326 prepaid expenses and other assets (1,270 ) 3,119 accounts payable, accrued expenses and other liabilities (2,288 ) 4,970 contract liabilities and customer advances 3,209 (2,085 ) current operating lease liabilities (1,856 ) (1,442 ) net cash provided by operating activities 12,408 17,888 investing activities: capitalized internal-use software costs (3,452 ) (3,535 ) purchases of property and equipment (347 ) (157 ) net cash used in investing activities (3,799 ) (3,692 ) financing activities: principal payments on finance leases (796 ) (466 ) principal payment and extinguishment costs on senior secured convertible notes — (204,014 ) principal payment and extinguishment costs on secured term note — (14,031 ) proceeds from issuance of convertible redeemable preferred stock, net of issuance costs — 188,183 other 48 (149 ) net cash used in financing activities (748 ) (30,477 ) effect of exchange rate changes on cash, cash equivalents and restricted cash (86 ) (588 ) net increase (decrease) in cash, cash equivalents and restricted cash 7,775 (16,869 ) cash, cash equivalents and restricted cash at beginning of period 22,279 50,741 cash, cash equivalents and restricted cash at end of period $ 30,054 $ 33,872 as of march 31, 2022 2021 cash and cash equivalents $ 29,629 $ 29,075 restricted cash 425 4,797 total cash, cash equivalents and restricted cash $ 30,054 $ 33,872 reconciliation of non-gaap financial measures the following table presents a reconciliation of gaap net loss to non-gaap adjusted ebitda and adjusted ebitda margin for each of the periods identified: three months ended march 31, (in thousands) 2022 (unaudited) 2021 (unaudited) gaap net loss (9,276 ) (36,355 ) amortization of intangible assets 6,779 6,439 depreciation 4,191 4,054 income tax provision 1,383 1,022 amortization expense of finance leases 704 443 interest expense, net 200 7,045 ebitda 3,981 (17,352 ) adjustments: stock-based compensation expense 2,536 4,937 change in fair value of contingent consideration liability 2,348 — amortization of cloud-computing implementation costs 359 — loss on extinguishment of debt — 9,629 other (income) expense, net (1) (2,435 ) 8,351 non-gaap adjusted ebitda $ 6,789 $ 5,565 non-gaap adjusted ebitda margin (2) 7.2 % 6.2 % (1) adjustments to other (income) expense, net reflect non-cash changes in the fair value of financing derivatives, interest make-whole derivative and warrants liability included in other income (expense), net on our condensed consolidated statements of operations and comprehensive loss. (2) adjusted ebitda margin is calculated by dividing adjusted ebitda by revenue reported on our condensed consolidated statements of operations and comprehensive loss for the applicable period. we do not provide gaap net loss on a forward-looking basis because we are unable to predict with reasonable certainty our future stock-based compensation expense, fair value adjustments, variable interest expense, litigation and restructuring expense and any unusual gains or losses without unreasonable effort. these items are uncertain, depend on various factors, and could be material to results computed in accordance with gaap. for this reason, we are unable without unreasonable effort to provide a reconciliation of adjusted ebitda to the most directly comparable gaap measure, gaap net loss, on a forward-looking basis. revenues revenues from our two offerings of products and services are as follows: three months ended march 31, (in thousands) 2022 (unaudited) % of revenue 2021 (unaudited) % of revenue $ variance % variance digital ad solutions $ 53,137 56.5 % $ 53,045 58.7 % $ 92 0.2 % cross platform solutions (1) 40,829 43.5 % 37,285 41.3 % 3,544 9.5 % total revenues $ 93,966 100.0 % $ 90,330 100.0 % $ 3,636 4.0 % (1) cross platform solutions revenue includes revenue from our movies business, which grew from $6.8 million in the first quarter of 2021 to $8.2 million in the first quarter of 2022.
