Business Wire

DoubleVerify Reports Fourth Quarter and Full Year 2022 Financial Results

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Business Wire

DoubleVerify Reports Fourth Quarter and Full Year 2022 Financial Results

10 Mins read

Achieved Record Fourth Quarter and Full-Year 2022 Revenue and Net Cash from Operating Activities

Increased 2022 Revenue by 36% Year-over-Year to $452.4 Million, Driven by Growth in Pre-Campaign Activation Across Programmatic, Social and CTV

Increased 2022 Net Cash from Operating Activities by 15% to $94.9 Million

Achieved Full Year 2022 Net Income of $43.3 Million and Adjusted EBITDA of $141.6 Million, representing a 31% Adjusted EBITDA margin

NEW YORK–(BUSINESS WIRE)–DoubleVerify (“DV”) (NYSE: DV), a leading software platform for digital media measurement, data and analytics, today announced financial results for the fourth quarter and full year ended December 31, 2022.

2022 was another year of exceptional growth driven by strong execution,” said Mark Zagorski, CEO of DoubleVerify. “We measured 5.5 trillion media transactions, grew revenue by 36% to more than $452 million, achieved 31% adjusted EBITDA margins and generated approximately $95 million of net cash from operating activities. Our ability to significantly outpace the broader digital advertising industry throughout 2022 was fueled by expanding product usage within our existing customer base and by winning new customers, both of which resulted in market share gains across geographies and platforms. Looking ahead, we are excited to meaningfully scale our solutions across fast-growing and underpenetrated media environments such as CTV, Social media and Retail Media Networks. We continue to successfully drive our ‘verify everywhere’ mission powered by our industry-leading platform that protects and maximizes media investment, making DV’s products a strategic imperative for advertisers and creating durable demand in 2023 and beyond.”

Fourth Quarter 2022 Financial Highlights:

(All comparisons are to the fourth quarter of 2021)

  • Total revenue of $133.6 million, an increase of 27%.
  • Activation revenue of $75.5 million, an increase of 40%.
  • Measurement revenue of $46.3 million, an increase of 10%.

    • Media Transactions Measured (“MTM”) for CTV and Social increased by 29% and 33% respectively.
    • International measurement revenue increased by 5%, with APAC revenue growth of 14% while EMEA revenue was stable.
  • Supply-Side revenue of $11.8 million, an increase of 29%.
  • Net income of $18.1 million and adjusted EBITDA of $48.9 million, which represented a 37% adjusted EBITDA margin.

Full Year 2022 Financial Highlights:

(All comparisons are to full year 2021)

  • Total revenue of $452.4 million, an increase of 36%.
  • Media Transactions Measured (MTM) were 5.5 trillion, an increase of 22%.
  • Measured Transaction Fee (MTF) was $0.072, an increase of 7%
  • Net Revenue Retention (NRR) of 127%
  • Activation revenue of $251.2 million, an increase of 50%.
  • Measurement revenue of $157.9 million, an increase of 17%.

    • Social measurement revenue increased by 28% and represented 37% of Measurement Revenue.
    • Media Transactions Measured for CTV increased by 45%.
  • International revenue increased by 12%
  • Supply-Side revenue of $43.3 million, an increase of 47%.
  • Net income of $43.3 million, an increase of 48%.
  • Adjusted EBITDA of $141.6 million, an increase of 29%, representing a 31% adjusted EBITDA margin.

Fourth Quarter and Recent Business Highlights:

  • Grew Media Transactions Measured (“MTM”) by 22% and increased Measured Transaction Fee (“MTF”) by 3%.
  • Continued to achieve a Gross Revenue Retention rate of over 95% in the fourth quarter.
  • Grew premium-priced Authentic Brand Suitability (ABS) revenues by 38% year-over-year in the fourth quarter driven by new advertisers activating the solution as well as by existing client upsells and geographic expansion.
  • Drove global market share growth through product upsells, international expansion and new enterprise logo wins, including Dropbox, AirBnB, GlaxoSmithKline, Swarovski, Mattress Firm, Adobe Japan and Fujifilm Japan.
  • Successfully launched post campaign Brand Safety and Suitability measurement on TikTok and on Twitter’s newsfeed, known as Timelines. This proprietary solution leverages DV’s artificial intelligence, machine learning, ontology, and manual review to give advertisers confidence that their ads are appearing next to content that is brand safe and suitable.
  • Launched the industry’s first-ever scalable solution to verify viewability on Connected TV (CTV), augmenting advertiser confidence in their media investment on this premium channel. This expansion of viewability enables advertisers to more fully measure delivery of the DV Authentic Ad™ across CTV inventory. The DV Authentic Ad™ is a proprietary, MRC-accredited metric that ensures consistent media quality across digital environments.
  • Received Media Rating Council (MRC) accreditation for its DV Authentic Attention® metrics, DV’s attention-based analytics and performance solution. This first time accreditation for attention spans DV’s full set of display and video DV Authentic Attention® metrics for desktop, mobile web, and mobile app.
  • Uncovered “BeatSting,” the first large-scale ad impression fraud scheme to target audio inventory. Since the DV Fraud Lab first identified the family of fraud in 2019, an estimated $20 million has been siphoned from advertisers. BeatSting alone is responsible for costing unprotected advertisers up to $1 million per month.

We delivered another strong year with 36% revenue growth and 31% adjusted EBITDA margins as we continued to outperform the broader digital advertising industry through a challenging macroeconomic environment,” said Nicola Allais, CFO of DoubleVerify. “Our fourth quarter and full-year outperformance is a testament to the essential nature of our products and to the strong execution of our teams. Our pipeline remains robust and with nearly $270 million dollars of cash and zero debt on our balance sheet, we are well-positioned to drive further business expansion and accelerate our long term growth.”

First Quarter and Full-Year 2023 Guidance:

DoubleVerify anticipates Revenue and Adjusted EBITDA to be in the following ranges:

First Quarter 2023:

  • Revenue of $117 to $119 million, a year-over-year increase of 22% at the midpoint.
  • Adjusted EBITDA in the range of $28 to $30 million, representing a 25% margin at the midpoint.

Full Year 2023:

  • Revenue of $550 to $564 million, a year-over-year increase of 23% at the midpoint.
  • Adjusted EBITDA in the range of $164 to $172 million, representing a 30% margin at the midpoint.

With respect to the Company’s expectations under “First Quarter and Full Year 2023 Guidance” above, the Company has not reconciled the non-GAAP measure Adjusted EBITDA to the GAAP measure net income in this press release because the Company does not provide guidance for stock-based compensation expense, depreciation and amortization expense, acquisition-related costs, interest income, and income taxes on a consistent basis as the Company is unable to quantify these amounts without unreasonable efforts, which would be required to include a reconciliation of Adjusted EBITDA to GAAP net income. In addition, the Company believes such a reconciliation would imply a degree of precision that could be confusing or misleading to investors.

Conference Call, Webcast and Other Information

DoubleVerify will host a conference call and live webcast to discuss its fourth quarter 2022 financial results at 4:30 p.m. Eastern Time today, March 1, 2023. To access the conference call, dial (877) 841-2987 for the U.S. or Canada, or (215) 268-9878 for international callers. The webcast will be available live on the Investors section of the Company’s website at https://ir.doubleverify.com/. An archived webcast will be available approximately two hours after the conclusion of the live event.

In addition, DoubleVerify plans to post certain additional historical quarterly financial information on the investor relations portion of its website for easy access to investors.

Key Business Terms

Activation revenue is generated from the evaluation, verification and measurement of advertising impressions purchased through programmatic demand-side and social media platforms.

Measurement revenue is generated from the verification and measurement of advertising impressions that are directly purchased on digital media properties, including publishers and social media platforms.

Supply-Side revenue is generated from platforms and publisher partners who use DoubleVerify’s data analytics to evaluate, verify and measure their advertising inventory.

Net Revenue Retention Rate is the total current period revenue earned from advertiser customers, which were also customers during the entire most recent twelve-month period, divided by the total prior year period revenue earned from the same advertiser customers, excluding a portion of our revenues that cannot be allocated to specific advertiser customers.

Gross Revenue Retention Rate is the total prior period revenue earned from advertiser customers, less the portion of prior period revenue attributable to lost advertiser customers, divided by the total prior period revenue from advertiser customers.

Media Transactions Measured (MTM) is the volume of media transactions that DoubleVerify’s software platform measures.

Measured Transaction Fee (MTF) is the fixed fee DoubleVerify charges per thousand Media Transactions Measured.

International Revenue Growth Rates are inclusive of foreign currency fluctuations.

 

DoubleVerify Holdings, Inc.

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

As of December 31,

(in thousands, except per share data)

 

2022

 

2021

Assets:

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

267,813

 

$

221,591

Trade receivables, net of allowances for doubtful accounts of $8,893 and $6,527 as of December 31, 2022 and December 31, 2021, respectively

 

 

167,122

 

 

122,938

Prepaid expenses and other current assets

 

 

10,161

 

 

23,295

Total current assets

 

 

445,096

 

 

367,824

Property, plant and equipment, net

 

 

47,034

 

 

17,575

Operating lease right-of-use assets, net

 

 

64,692

 

 

Goodwill

 

 

343,011

 

 

350,560

Intangible assets, net

 

 

135,429

 

 

153,395

Deferred tax assets

 

 

35

 

 

60

Other non‑current assets

 

 

1,731

 

 

2,780

Total assets

 

$

1,037,028

 

$

892,194

Liabilities and Stockholder’s Equity:

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Trade payables

 

$

6,675

 

$

3,853

Accrued expense

 

 

33,085

 

 

41,456

Operating lease liabilities, current

 

 

7,041

 

 

Income tax liabilities

 

 

11,953

 

 

1,321

Current portion of finance lease obligations

 

 

1,846

 

 

1,970

Contingent consideration current

 

 

 

 

1,717

Other current liabilities

 

 

8,310

 

 

6,716

Total current liabilities

 

 

68,910

 

 

57,033

Operating lease liabilities, non-current

 

 

74,086

 

 

Finance lease obligations

 

 

779

 

 

2,579

Deferred tax liabilities

 

 

12,890

 

 

30,307

Other non‑current liabilities

 

 

3,504

 

 

3,209

Total liabilities

 

$

160,169

 

$

93,128

Commitments and contingencies (Note 15)

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

Common stock, $0.001 par value, 1,000,000 shares authorized, 165,448 shares issued and 165,417 outstanding as of December 31, 2022; 1,000,000 shares authorized, 162,347 shares issued and 162,297 outstanding as of December 31, 2021

 

 

165

 

 

162

Additional paid‑in capital

 

 

756,299

 

 

717,228

Treasury stock, at cost, 31 shares and 50 shares as of December 31, 2022 and December 31, 2021, respectively

 

 

(796)

 

 

(1,802)

Retained earnings

 

 

127,517

 

 

84,249

Accumulated other comprehensive loss, net of income taxes

 

 

(6,326)

 

 

(771)

Total stockholders’ equity

 

 

876,859

 

 

799,066

Total liabilities and stockholders’ equity

 

$

1,037,028

 

$

892,194

 

DoubleVerify Holdings, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

(in thousands, except per share data)

 

2022

 

2021

 

2020

Revenue

 

$

452,418

 

$

332,741

 

$

243,917

Cost of revenue (exclusive of depreciation and amortization shown separately below)

 

 

77,866

 

 

54,382

 

 

35,750

Product development

 

 

95,118

 

 

62,698

 

 

47,004

Sales, marketing and customer support

 

 

107,416

 

 

77,312

 

 

62,157

General and administrative

 

 

78,666

 

 

81,380

 

 

53,056

Depreciation and amortization

 

 

34,328

 

 

30,285

 

 

24,595

Income from operations

 

 

59,024

 

 

26,684

 

 

21,355

Interest expense

 

 

905

 

 

1,172

 

 

4,931

Other income, net

 

 

(1,249)

 

 

(309)

 

 

(885)

Income before income taxes

 

 

59,368

 

 

25,821

 

 

17,309

Income tax expense (benefit)

 

 

16,100

 

 

(3,487)

 

 

(3,144)

Net income

 

$

43,268

 

$

29,308

 

$

20,453

Earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.26

 

$

0.20

 

$

0.15

Diluted

 

$

0.25

 

$

0.18

 

$

0.14

Weighted‑average common stock outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

 

163,882

 

 

148,309

 

 

138,072

Diluted

 

 

170,755

 

 

160,264

 

 

145,443

Comprehensive income:

 

 

 

 

 

 

 

 

 

Net income

 

$

43,268

 

$

29,308

 

$

20,453

Other comprehensive (loss) income:

 

 

 

 

 

 

 

 

 

Foreign currency cumulative translation adjustment

 

 

(5,555)

 

 

(1,782)

 

 

1,078

Total comprehensive income

 

$

37,713

 

$

27,526

 

$

21,531

 

DoubleVerify Holdings, Inc.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive

 

 

 

 

 

Common Stock

 

Preferred Stock

 

 

 

 

 

 

Additional

 

 

 

 

(Loss) Income

 

Total

 

 

Shares

 

 

 

 

Shares

 

 

 

 

Treasury Stock

 

Paid‑in

 

Retained

 

Net of

 

Stockholders’

(in thousands)

 

Issued

 

Amount

 

Issued

 

Amount

 

Shares

 

Amount

 

Capital

 

Earnings

 

Income Taxes

 

Equity

Balances as of January 1, 2020

 

139,721

 

$

140

 

 

$

 

 

$

 

$

283,457

 

$

34,488

 

$

(67)

 

$

318,018

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,078

 

 

1,078

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

5,984

 

 

 

 

 

 

5,984

Exchange of common stock for Series A preferred stock

 

 

 

 

45,438

 

 

454

 

15,146

 

 

(260,686)

 

 

260,232

 

 

 

 

 

 

Additional Series A preferred stock issuance, net of issuance costs

 

 

 

 

15,568

 

 

156

 

 

 

 

 

85,308

 

 

 

 

 

 

85,464

Repurchase of vested options

 

 

 

 

 

 

 

 

 

 

 

(15,506)

 

 

 

 

 

 

(15,506)

Common stock issued under employee purchase plan

 

61

 

 

 

 

 

 

 

 

 

 

424

 

 

 

 

 

 

424

Common stock issued upon exercise of stock options

 

255

 

 

 

 

 

 

 

 

 

 

780

 

 

 

 

 

 

780

Common stock issued upon vesting of restricted stock units

 

185

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

20,453

 

 

 

 

20,453

Balances as of December 31, 2020

 

140,222

 

$

140

 

61,006

 

$

610

 

15,146

 

$

(260,686)

 

$

620,679

 

$

54,941

 

$

1,011

 

$

416,695

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,782)

 

 

(1,782)

Shares repurchased for settlement of employee tax withholdings

 

 

 

 

 

 

 

50

 

 

(1,802)

 

 

 

 

 

 

 

 

(1,802)

Issuance of common stock as consideration for acquisition

 

684

 

 

1

 

 

 

 

 

 

 

 

22,525

 

 

 

 

 

 

22,526

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

21,887

 

 

 

 

 

 

21,887

Common stock issued under employee purchase plan

 

15

 

 

 

 

 

 

 

 

 

 

404

 

 

 

 

 

 

404

Common stock issued upon exercise of stock options

 

4,782

 

 

5

 

 

 

 

 

 

 

 

12,435

 

 

 

 

 

 

12,440

Common stock issued upon vesting of restricted stock units

 

366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conversion of Series A preferred stock to common stock

 

5,190

 

 

5

 

(61,006)

 

 

(610)

 

(15,146)

 

 

260,686

 

 

(260,081)

 

 

 

 

 

 

Issuance of common stock upon initial public offering

 

9,977

 

 

10

 

 

 

 

 

 

 

 

269,380

 

 

 

 

 

 

269,390

Private placement stock issuance concurrent with initial public offering

 

1,111

 

 

1

 

 

 

 

 

 

 

 

29,999

 

 

 

 

 

 

30,000

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

29,308

 

 

 

 

29,308

Balances as of December 31, 2021

 

162,347

 

$

162

 

 

$

 

50

 

$

(1,802)

 

$

717,228

 

$

84,249

 

$

(771)

 

$

799,066

Foreign currency translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(5,555)

 

 

(5,555)

Shares repurchased for settlement of employee tax withholdings

 

 

 

 

 

 

 

402

 

 

(10,244)

 

 

 

 

 

 

 

 

(10,244)

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

42,787

 

 

 

 

 

 

42,787

Common stock issued to non-employees

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock issued upon exercise of stock options

 

1,518

 

 

2

 

 

 

 

 

 

 

 

5,801

 

 

 

 

 

 

5,803

Common stock issued upon vesting of restricted stock units

 

1,488

 

 

1

 

 

 

 

 

 

 

 

(1)

 

 

 

 

 

 

Common stock issued under employee purchase plan

 

91

 

 

 

 

 

 

 

 

 

 

1,734

 

 

 

 

 

 

1,734

Treasury stock reissued upon settlement of equity awards

 

 

 

 

 

 

 

(421)

 

 

11,250

 

 

(11,250)

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

43,268

 

 

 

 

43,268

Balances as of December 31, 2022

 

165,448

 

$

165

 

 

$

 

31

 

$

(796)

 

$

756,299

 

$

127,517

 

$

(6,326)

 

$

876,859

 

DoubleVerify Holdings, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

(in thousands)

 

2022

 

2021

 

2020

Operating activities:

 

 

 

 

 

 

 

 

 

Net income

 

$

43,268

 

$

29,308

 

$

20,453

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

 

 

 

 

 

Bad debt expense (recovery)

 

 

5,033

 

 

(711)

 

 

4,811

Depreciation and amortization expense

 

 

34,328

 

 

30,285

 

 

24,595

Amortization of debt issuance costs

 

 

294

 

 

294

 

 

285

Non-cash lease expense

 

 

7,339

 

 

 

 

Loss on extinguishment of debt

 

 

 

 

 

 

350

Accretion of acquisition liabilities

 

 

 

 

 

 

36

Deferred taxes

 

 

(19,581)

 

 

(7,866)

 

 

(5,137)

Stock-based compensation expense

 

 

42,307

 

 

21,887

 

 

5,984

Interest expense (income)

 

 

107

 

 

103

 

 

(12)

Loss on disposal of fixed assets

 

 

1,353

 

 

 

 

Impairment of long-lived assets

 

 

1,510

 

 

 

 

Change in fair value of contingent consideration

 

 

 

 

57

 

 

(949)

Offering costs

 

 

 

 

22,074

 

 

3,555

Other

 

 

87

 

 

733

 

 

673

Changes in operating assets and liabilities, net of effects of business combinations

 

 

 

 

 

 

 

 

 

Trade receivables

 

 

(49,765)

 

 

(22,004)

 

 

(30,443)

Prepaid expenses and other assets

 

 

9,094

 

 

(7,567)

 

 

(9,013)

Trade payables

 

 

2,884

 

 

(49)

 

 

2,482

Accrued expenses and other liabilities

 

 

16,604

 

 

16,205

 

 

3,546

Net cash provided by operating activities

 

 

94,862

 

 

82,749

 

 

21,216

Investing activities:

 

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(39,981)

 

 

(9,397)

 

 

(9,751)

Acquisition of businesses, net of cash acquired

 

 

 

 

(149,217)

 

 

Net cash used in investing activities

 

 

(39,981)

 

 

(158,614)

 

 

(9,751)

Financing activities:

 

 

 

 

 

 

 

 

 

Proceeds from long-term debt

 

 

 

 

 

 

89,650

Payments of long-term debt

 

 

 

 

(22,000)

 

 

(142,113)

Deferred payment related to Leiki acquisition

 

 

 

 

 

 

(2,033)

Deferred payment related to Zentrick acquisition

 

 

 

 

(50)

 

 

(50)

Payment of contingent consideration related to Zentrick acquisition

 

 

(3,247)

 

 

 

 

(601)

Repurchase of vested options

 

 

 

 

 

 

(15,506)

Proceeds from Series A preferred stock issuance, net of issuance costs

 

 

 

 

 

 

346,150

Payments to shareholders for preferred stock Series A

 

 

 

 

 

 

(260,686)

Proceeds from common stock issued upon exercise of stock options

 

 

5,803

 

 

12,440

 

 

780

Proceeds from common stock issued under employee purchase plan

 

 

1,734

 

 

404

 

 

424

Proceeds from issuance of common stock upon initial public offering

 

 

 

 

269,390

 

 

Proceeds from issuance of common stock in connection to concurrent private placement

 

 

 

 

30,000

 

 

Payments related to offering costs

 

 

(6)

 

 

(22,069)

 

 

(3,610)

Payments related to debt issuance costs

 

 

 

 

 

 

(577)

Finance lease payments

 

 

(1,924)

 

 

(1,918)

 

 

(1,443)

Shares repurchased for settlement of employee tax withholdings

 

 

(10,244)

 

 

(1,802)

 

 

Net cash (used in) provided by financing activities

 

 

(7,884)

 

 

264,395

 

 

10,385

Effect of exchange rate changes on cash and cash equivalents and restricted cash

 

 

(784)

 

 

(200)

 

 

203

Net increase in cash, cash equivalents, and restricted cash

 

 

46,213

 

 

188,330

 

 

22,053

Cash, cash equivalents, and restricted cash—Beginning of period

 

 

221,725

 

 

33,395

 

 

11,342

Cash, cash equivalents, and restricted cash—End of period

 

$

267,938

 

$

221,725

 

$

33,395

Cash and cash equivalents

 

$

267,813

 

$

221,591

 

$

33,354

Restricted cash (included in prepaid expenses and other assets on the Consolidated Balance Sheets)

 

 

125

 

 

134

 

 

41

Total cash and cash equivalents and restricted cash

 

$

267,938

 

$

221,725

 

$

33,395

Supplemental cash flow information:

 

 

 

 

 

 

 

 

 

Cash paid for taxes

 

 

12,351

 

 

7,698

 

 

16,180

Cash paid for interest

 

 

554

 

 

774

 

 

3,369

Non‑cash investing and financing transactions:

 

 

 

 

 

 

 

 

 

Common stock issued in connection with acquisition

 

 

 

 

22,526

 

 

Exchange of common stock for preferred stock

 

 

 

 

 

 

260,686

Right-of-use assets obtained in exchange for new operating lease liabilities, net of impairments and tenant improvement allowances

 

 

71,979

 

 

 

 

Acquisition of equipment under finance lease

 

 

 

 

1,518

 

 

1,603

Capital assets financed by accounts payable

 

 

12

 

 

36

 

 

Treasury stock reissued upon the conversion of Series A preferred stock for common stock

 

 

 

 

260,686

 

 

Offering costs included in accounts payable and accrued expense

 

 

 

 

5

 

 

75

Stock-based compensation included in capitalized software development costs

 

 

480

 

 

 

 

 

Comparison of the Three and Twelve Months Ended December 31, 2022 and December 31, 2021

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31,

 

Change

 

Change

 

Year Ended December 31,

 

Change

 

Change

 

2022

 

2021

 

$

 

%

 

2022

 

2021

 

$

 

%

 

(In Thousands)

 

 

 

 

 

 

 

(In Thousands)

 

 

 

 

 

 

Revenue by customer type:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Measurement (f/k/a Advertiser – direct)

$

46,324

 

$

42,256

 

$

4,068

 

10

%

 

$

157,908

 

$

135,516

 

$

22,392

 

17

%

Activation (f/k/a Advertiser – programmatic)

 

75,502

 

 

54,104

 

 

21,398

 

40

 

 

 

251,198

 

 

167,798

 

 

83,400

 

50

 

Supply-side customer

 

11,810

 

 

9,173

 

 

2,637

 

29

 

 

 

43,312

 

 

29,427

 

 

13,885

 

47

 

Total revenue

$

133,636

 

$

105,533

 

$

28,103

 

27

%

 

$

452,418

 

$

332,741

 

$

119,677

 

36

%

 

Adjusted EBITDA

In addition to our results determined in accordance with GAAP, we believe that certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, are useful in evaluating our business. We calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue. The following table presents a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to the most directly comparable financial measure prepared in accordance with GAAP.

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31,

 

Year Ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(In Thousands)

 

(In Thousands)

Net income

$

18,068

 

$

28,308

 

$

43,268

 

$

29,308

Net income margin

 

14%

 

 

27%

 

 

10%

 

 

9%

Depreciation and amortization

 

8,882

 

 

8,296

 

 

34,328

 

 

30,285

Stock-based compensation

 

11,083

 

 

9,787

 

 

42,307

 

 

21,887

Interest expense

 

224

 

 

237

 

 

905

 

 

1,172

Income tax expense (benefit)

 

11,979

 

 

(11,848)

 

 

16,100

 

 

(3,487)

M&A and restructuring costs (a)

 

5

 

 

2,382

 

 

1,224

 

 

3,510

Offering, IPO readiness and secondary offering costs (b)

 

566

 

 

1,099

 

 

1,292

 

 

23,564

Other (recoveries) costs (c)

 

(245)

 

 

2,825

 

 

3,414

 

 

3,812

Other income (d)

 

(1,671)

 

 

(674)

 

 

(1,249)

 

 

(309)

Adjusted EBITDA

$

48,891

 

$

40,412

 

$

141,589

 

$

109,742

Adjusted EBITDA margin

 

37%

 

 

38%

 

 

31%

 

 

33%

________________
(a)

M&A and restructuring costs for the year ended December 31, 2022 consist of transaction costs, integration and restructuring costs related to the acquisition of OpenSlate. M&A costs for the year ended December 31, 2021 consist of transaction and integration costs related to the acquisition of Meetrics and OpenSlate as well as associated restructuring costs and related activities.

(b)

Offering, IPO readiness and secondary offering costs for the year ended December 31, 2022 consist of third-party costs incurred for the Company’s filing of a “shelf” registration statement on Form S-3, and costs incurred for an underwritten secondary public offering by certain stockholders of the Company. Offering, IPO readiness and secondary offering costs for the year ended December 31, 2021 consist of third-party costs incurred for the Company’s IPO, and costs for an underwritten secondary public offering by certain stockholders of the Company.

(c)

Other costs for the year ended December 31, 2022 consist of costs related to the departures of the Company’s former Chief Operating Officer and Chief Customer Officer, impairment related to a subleased office space and costs related to the disposal of furniture for unoccupied lease office space, partially offset by sublease income for lease office space. Other costs for the year ended December 31, 2021 include reimbursements paid to Providence for costs incurred prior to the IPO date, non-recurring recognition of a cease-use liability related to unoccupied lease office space, and costs associated with the early termination of the agreement for the Zentrick Deferred Payment Terms, previously disclosed as a contingency.

(d)

Other income for the years ended December 31, 2022 and 2021 consists of interest income earned on monetary assets, changes in fair value associated with contingent consideration, and the impact of changes in foreign currency exchange rates.

Contacts

Investor Relations
Tejal Engman

DoubleVerify

IR@doubleverify.com

Media Contact
Chris Harihar

Crenshaw Communications

646‑535‑9475

chris@crenshawcomm.com

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