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Innovid Reports Q2 2024 Financial Results

  • Q2 2024 revenue increased 10% year-over-year to $38.0 million
  • Q2 2024 net loss improved year-over-year to $10.5 million and Adjusted EBITDA* increased 29% year-over-year to $5.9 million
  • Adjusted EBITDA margin increased to 15.5%, the eighth consecutive quarter of expansion
  • CTV impression volume from ad serving and personalization increased 21% year-over-year

Innovid Corp. (NYSE:CTV) (the "Company"), an independent software platform for the creation, delivery, measurement, and optimization of advertising across connected TV (CTV), linear TV, and digital, today announced financial results for the second quarter ended June 30, 2024.

“I am pleased to report Innovid delivered another quarter of double-digit, profitable revenue growth,” said Zvika Netter, Co-Founder and CEO. “Since the beginning of 2024, we have made momentous progress, including the launch of our strategic Harmony Initiative and new partnerships with leading players in the market. We continue to invest significantly in strategic innovation for the future of CTV, while also delivering Adjusted EBITDA margin expansion.”

Second Quarter 2024 Financial Summary

  • Revenue increased to $38.0 million, reflecting year-over-year growth of 10%, compared to $34.5 million for the same period in 2023.
  • Net loss was $10.5 million, compared to a net loss of $19.0 million for the same period in 2023, an $8.5 million improvement year-over-year.
  • Adjusted EBITDA* grew to $5.9 million, an increase of 29% year-over-year, compared to $4.5 million for the same period in 2023, representing a 15.5% Adjusted EBITDA margin.*
  • Operating cash flow was $1.2 million, compared to $0.6 million for the same period in 2023.
  • Free cash flow* use of cash was $1.3 million, compared to use of cash of $2.0 million for the same period in 2023, a $0.7 million improvement year-over-year.

Recent Business Highlights

  • Innovid launched Harmony Frequency, the first holistic frequency management solution for CTV and digital advertising, with Yahoo DSP as a launch partner.
  • Innovid announced today a collaboration with Nielsen with the intent to provide a seamless workflow solution and holistic view of the cross-media ads universe. The integration aims to bring Innovid’s ad serving infrastructure together with Nielsen ONE to simplify and improve ad measurement.
  • Goodway Group and Vizio recently joined the Harmony initiative, alongside previously announced partners Roku, PMG, Assembly, and CMI Media Group.
  • Recent new client wins and product expansions with leading advertisers and publishers such as Spectrum, WNBA, Eli Lilly, Lundbeck, Purple Innovation, Habit Burger, and The Wonderful Company.
  • CTV impression volume from ad serving and personalization increased 21% year-over-year, while Mobile video impressions from ad serving and personalization grew by 13% year-over-year, and desktop impressions from ad serving and personalization decreased by 9% year-over-year.
  • Innovid joined the broad-market Russell 3000® Index during the 2024 Russell US Indexes annual reconstitution.

Financial Outlook

Innovid is providing the following financial guidance for Q3 and reiterating full year 2024 guidance:

  • Q3 2024 revenue in a range between $40 million and $42 million, reflecting year-over–year growth between 10% and 16%.
  • Q3 2024 Adjusted EBITDA* in a range between $6.5 million and $8.5 million.
  • FY 2024 revenue in a range between $156 million and $163 million, representing annual growth between 11% and 16%.
  • FY 2024 Adjusted EBITDA* in a range between $24 million and $29 million.

*See non-GAAP financial measures and reconciliation of GAAP to non-GAAP tables.

Conference Call

The Company will host a conference call and webcast to discuss second quarter 2024 financial results today at 8:30 a.m. Eastern Time. Hosting the call will be Zvika Netter, Co-founder and Chief Executive Officer and Anthony Callini, Chief Financial Officer. The conference call will be available via webcast at investors.innovid.com. To participate via telephone, please dial (+1) 877-407-3211 (toll free) or (+1) 201-389-0862 (toll-free international).

Following the call, a replay of the webcast will be available for 90 days on the Innovid Investor Relations website.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures under the rules of the U.S. Securities and Exchange Commission. This non-GAAP information supplements and is not intended to represent a measure of performance in accordance with disclosures required by generally accepted accounting principles. Non-GAAP financial measures are used internally as measures of operational efficiency to understand and evaluate our core business operations, as well as comparisons to peers as similar measures are frequently used by securities analysts, investors, ratings agencies and other interested parties to evaluate businesses in our industry. Accordingly, Innovid believes it is useful for investors and others to review both GAAP and non-GAAP measures in order for (a) period-to-period comparisons of our core business, (b) comparisons to peers as similar measures are frequently used by securities analysts, investors, ratings agencies and other interested parties to evaluate businesses in our industry, and (c) providing an understanding and evaluation of our trends when comparing our operating results, on a consistent basis, by excluding items that we do not believe are indicative of our core operating performance. However, these non-GAAP financial measures should not take the place of GAAP financial measures in evaluating our business. The primary limitations associated with the use of non-GAAP financial measures are that these measures may not be directly comparable to the amounts reported by other companies and they do not include all items of income and expense that affect operations. Innovid management compensates for these limitations by considering the company’s financial results and outlook as determined in accordance with GAAP and by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures in the tables attached to this press release. We are not able to provide a reconciliation of the projected Adjusted EBITDA to expected net (loss) income attributable to Innovid for the second quarter of 2024 or the full year of 2024, without unreasonable effort. This is due to the unknown effect, timing, and potential significance of the effects of taxes on income in multiple jurisdictions, finance (income)/expenses including valuations, among others. These items have in the past, and may in the future, significantly affect GAAP results in a particular period.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1996. The Company's actual results may differ from its expectations, estimates, and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," "aim," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, the Company's expectations regarding its future financial results, expected growth, and future market opportunity. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results, including Innovid's ability to achieve and, if achieved, maintain profitability, decrease and/or changes in CTV audience viewership behavior, Innovid's failure to make the right investment decisions or to innovate and develop new solutions, inaccurate estimates or projections of future financial performance, Innovid's failure to manage growth effectively, the dependence of Innovid's revenues and business on the overall demand for advertising and a limited number of advertising agencies and advertisers, the actual or potential impacts of international conflicts and humanitarian crises on global markets, the rejection of digital advertising by consumers, future restrictions on Innovid's ability to collect, use and disclose data, market pressure resulting in a reduction of Innovid's revenues per impression, Innovid's failure to adequately scale its platform infrastructure, exposure to fines and liability if advertisers, publishers and data providers do not obtain necessary and requisite consents from consumers for Innovid to process their personal data, competition for employee talent, seasonal fluctuations in advertising activity, payment-related risks, interruptions or delays in services from third parties, errors, defects, or unintended performance problems in Innovid's platform, intense market competition, failure to comply with the terms of third party open source components, changes in tax laws or tax rulings, failure to maintain an effective system of internal controls over financial reporting, failure to comply with data privacy and data protection laws, infringement of third party intellectual property rights, difficulty in enforcing Innovid's own intellectual property rights, system failures, security breaches or cyberattacks, additional financing if required may not be available, the volatility of the price of Innovid's common stock and warrants, and other important factors discussed under the caption "Risk Factors" in Innovid's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commissions (“SEC”) on February 29, 2024, as such factors may be updated from time to time in its other filings with the SEC, accessible on the SEC's website at www.sec.gov and the Investors Relations section of Innovid's website at investors.innovid.com. You should carefully consider the risks and uncertainties described in the documents filed by the Company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Most of these factors are outside the Company's control and are difficult to predict. The Company cautions not to place undue reliance upon any forward-looking statements, including projections, which speak only as of the date made. The Company does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.

About Innovid

Innovid (NYSE:CTV) is an independent software platform for the creation, delivery, measurement, and optimization of advertising across connected TV (CTV), linear, and digital. Through a global infrastructure that enables cross-platform ad serving, data-driven creative, and measurement, Innovid offers its clients always-on intelligence to optimize advertising investment across channels, platforms, screens, and devices. Innovid is an independent platform that leads the market in converged TV innovation, through proprietary technology and exclusive partnerships designed to reimagine TV advertising. Headquartered in New York City, Innovid serves a global client base through offices across the Americas, Europe, and Asia Pacific. To learn more, visit https://www.innovid.com/ or follow us on LinkedIn or X.

INNOVID, CORP. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited and in thousands)

 

 

June 30, 2024

 

December 31, 2023

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

30,580

 

 

$

49,585

 

Trade receivables, net

 

45,762

 

 

 

46,420

 

Prepaid expenses and other current assets

 

5,375

 

 

 

5,615

 

Total current assets

 

81,717

 

 

 

101,620

 

Long-term restricted deposits

 

430

 

 

 

412

 

Property and equipment, net

 

20,449

 

 

 

18,419

 

Goodwill

 

102,473

 

 

 

102,473

 

Intangible assets, net

 

22,309

 

 

 

24,318

 

Operating lease right of use asset

 

11,047

 

 

 

1,435

 

Other non-current assets

 

799

 

 

 

1,278

 

Total assets

$

239,224

 

 

$

249,955

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Trade payables

$

6,548

 

 

$

2,810

 

Employee and payroll accruals

 

9,312

 

 

 

14,060

 

Lease liabilities—current portion

 

1,354

 

 

 

1,200

 

Accrued expenses and other current liabilities

 

11,849

 

 

 

7,426

 

Total current liabilities

 

29,063

 

 

 

25,496

 

Long-term debt

 

 

 

 

20,000

 

Lease liabilities—non-current portion

 

10,053

 

 

 

634

 

Other non-current liabilities

 

10,536

 

 

 

7,528

 

Warrants liability

 

664

 

 

 

307

 

Common stock

 

14

 

 

 

13

 

Additional paid-in capital

 

388,467

 

 

 

378,774

 

Accumulated deficit

 

(199,573

)

 

 

(182,797

)

Total stockholders’ equity

 

188,908

 

 

 

195,990

 

Total liabilities and stockholders’ equity

$

239,224

 

 

$

249,955

 

INNOVID, CORP. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited and in thousands, except share and per share data)

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Revenue

$

37,951

 

 

$

34,546

 

 

$

74,689

 

 

$

65,031

 

Cost of revenue (1)

 

9,097

 

 

 

8,591

 

 

 

17,829

 

 

 

16,856

 

Research and development (1)

 

7,304

 

 

 

6,876

 

 

 

13,625

 

 

 

13,993

 

Sales and marketing (1)

 

12,215

 

 

 

11,460

 

 

 

23,841

 

 

 

23,097

 

General and administrative (1)

 

9,297

 

 

 

8,924

 

 

 

19,832

 

 

 

18,574

 

Depreciation and amortization

 

2,831

 

 

 

2,064

 

 

 

5,455

 

 

 

4,094

 

Goodwill impairment

 

 

 

 

14,503

 

 

 

 

 

 

14,503

 

Operating loss

 

(2,793

)

 

 

(17,872

)

 

 

(5,893

)

 

 

(26,086

)

Finance income, net

 

(78

)

 

 

(248

)

 

 

(120

)

 

 

(2,723

)

Loss before taxes

 

(2,715

)

 

 

(17,624

)

 

 

(5,773

)

 

 

(23,363

)

Taxes on income

 

7,827

 

 

 

1,335

 

 

 

11,003

 

 

 

4,159

 

Net loss

$

(10,542

)

 

$

(18,959

)

 

$

(16,776

)

 

$

(27,522

)

 

 

 

 

 

 

 

 

Net loss per share common share—basic and diluted

$

(0.07

)

 

$

(0.14

)

 

$

(0.12

)

 

$

(0.20

)

Weighted-average number of shares used in computing net loss per share:

 

 

 

 

 

 

 

Basic and diluted

 

144,772,932

 

 

 

137,643,910

 

 

 

143,574,479

 

 

 

134,296,569

 

(1) Exclusive of depreciation and amortization presented separately.

INNOVID, CORP. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited and in thousands, except share and per share data)

 

 

Three months ended June 30, 2024

 

Common stock

 

Additional paid-in capital

 

Accumulated deficit

 

Total stockholders’ equity

 

Shares

 

Amount

 

 

 

Balance as of March 31, 2024

143,861,609

 

$

13

 

$

382,935

 

$

(189,031

)

 

$

193,917

 

Stock-based compensation

 

 

 

 

 

5,496

 

 

 

 

5,496

 

Issuance of common stock:

 

 

 

 

 

 

 

 

 

—exercised options and RSUs vested

1,942,048

 

 

1

 

 

36

 

 

 

 

37

 

Net loss

 

 

 

 

 

 

 

(10,542

)

 

 

(10,542

)

Balance as of June 30, 2024

145,803,657

 

$

14

 

$

388,467

 

$

(199,573

)

 

$

188,908

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended June 30, 2023

 

Common stock

 

Additional paid-in capital

 

Accumulated deficit

 

Total stockholders’ equity

 

Shares

 

Amount

 

 

 

Balance as of March 31, 2023

136,616,734

 

$

13

 

$

361,948

 

$

(159,449

)

 

$

202,512

 

Stock-based compensation

 

 

 

 

 

5,658

 

 

 

 

5,658

 

Issuance of common stock:

 

 

 

 

 

 

 

 

 

—exercised options and RSUs vested

2,120,370

 

 

 

 

364

 

 

 

 

364

 

Net loss

 

 

 

 

 

 

 

(18,959

)

 

 

(18,959

)

Balance as of June 30, 2023

138,737,104

 

$

13

 

$

367,970

 

$

(178,408

)

 

$

189,575

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended June 30, 2024

 

Common stock

 

Additional paid-in capital

 

Accumulated deficit

 

Total stockholders’ equity

 

Shares

 

Amount

 

 

 

Balance as of December 31, 2023

141,194,179

 

$

13

 

$

378,774

 

$

(182,797

)

 

$

195,990

 

Stock-based compensation

 

 

 

 

 

9,614

 

 

 

 

9,614

 

Issuance of common stock:

 

 

 

 

 

 

 

 

 

—exercised options and RSUs vested

4,609,478

 

 

1

 

 

79

 

 

 

 

80

 

Net loss

 

 

 

 

 

 

 

(16,776

)

 

 

(16,776

)

Balance as of June 30, 2024

145,803,657

 

 

14

 

$

388,467

 

$

(199,573

)

 

$

188,908

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended June 30, 2023

 

Common stock

 

Additional paid-in capital

 

Accumulated deficit

 

Total stockholders’ equity

 

Shares

 

Amount

 

 

 

Balance as of December 31, 2022

133,882,414

 

$

13

 

$

356,801

 

$

(150,886

)

 

$

205,928

 

Stock-based compensation

 

 

 

 

 

10,555

 

 

 

 

10,555

 

Issuance of common stock:

 

 

 

 

 

 

 

 

 

—exercised options and RSUs vested

4,854,690

 

 

 

 

614

 

 

 

 

614

 

Net loss

 

 

 

 

 

 

 

(27,522

)

 

 

(27,522

)

Balance as of June 30, 2023

138,737,104

 

$

13

 

$

367,970

 

$

(178,408

)

 

$

189,575

 

INNOVID, CORP. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited and in thousands)

 

 

Six months ended June 30,

 

 

 2024

 

 

 

 2023

 

Cash flows from operating activities:

 

 

 

Net loss

$

(16,776

)

 

$

(27,522

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

Depreciation and amortization

 

5,455

 

 

 

4,094

 

Goodwill impairment

 

 

 

 

14,503

 

Stock-based compensation

 

9,025

 

 

 

9,865

 

Change in fair value of warrants

 

357

 

 

 

(3,279

)

Loss on foreign exchange, net

 

251

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

Trade receivables, net

 

658

 

 

 

415

 

Prepaid expenses and other assets

 

535

 

 

 

(1,390

)

Operating lease right of use assets

 

404

 

 

 

902

 

Trade payables

 

3,739

 

 

 

1,060

 

Employee and payroll accruals

 

(4,748

)

 

 

804

 

Operating lease liabilities

 

(444

)

 

 

(1,130

)

Accrued expenses and other liabilities

 

7,430

 

 

 

2,626

 

Net cash provided by operating activities

 

5,886

 

 

 

948

 

Cash flows from investing activities:

 

 

 

Internal use software capitalization

 

(4,280

)

 

 

(5,591

)

Purchases of property and equipment

 

(587

)

 

 

(189

)

Withdrawal of short-term bank deposits

 

165

 

 

 

10,000

 

Increase in deposits

 

 

 

 

27

 

Net cash (used in) provided by investing activities

 

(4,702

)

 

 

4,247

 

Cash flows from financing activities:

 

 

 

Proceeds from loan

 

 

 

 

10,000

 

Payment on loan

 

(20,000

)

 

 

(10,000

)

Proceeds from exercise of options

 

80

 

 

 

614

 

Net cash (used in) provided by financing activities

 

(19,920

)

 

 

614

 

Effect of exchange rates on cash, cash equivalents and restricted cash

 

(251

)

 

 

 

(Decrease) increase in cash, cash equivalents, and restricted cash

 

(18,987

)

 

 

5,809

 

Cash, cash equivalents, and restricted cash at the beginning of the period

 

49,997

 

 

 

37,971

 

Cash, cash equivalents, and restricted cash at the end of the period

$

31,010

 

 

$

43,780

 

INNOVID, CORP. AND ITS SUBSIDIARIES

OTHER INFORMATION

(Unaudited and in thousands)

 

RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN PERCENT

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Net loss

$

(10,542

)

 

$

(18,959

)

 

$

(16,776

)

 

$

(27,522

)

Net loss margin percent

 

(28

)%

 

 

(55

)%

 

 

(22

)%

 

 

(42

)%

Depreciation and amortization

 

2,831

 

 

 

2,064

 

 

 

5,455

 

 

 

4,094

 

Goodwill impairment

 

 

 

 

14,503

 

 

 

 

 

 

14,503

 

Stock-based compensation

 

5,187

 

 

 

5,334

 

 

 

9,025

 

 

 

9,958

 

Finance income, net (a)

 

(78

)

 

 

(248

)

 

 

(120

)

 

 

(2,723

)

Retention bonus expenses (b)

 

40

 

 

 

148

 

 

 

132

 

 

 

445

 

Legal claims

 

206

 

 

 

342

 

 

 

1,134

 

 

 

656

 

Severance cost

 

415

 

 

 

 

 

 

415

 

 

 

845

 

Other

 

(14

)

 

 

23

 

 

 

 

 

 

272

 

Taxes on income

 

7,827

 

 

 

1,335

 

 

 

11,003

 

 

 

4,159

 

Adjusted EBITDA

$

5,872

 

 

$

4,542

 

 

$

10,268

 

 

$

4,687

 

Adjusted EBITDA margin percent

 

15.5

%

 

 

13.1

%

 

 

13.7

%

 

 

7.2

%

(a)

Finance income, net consists mostly of remeasurement related to revaluation of our warrants, remeasurement of our foreign subsidiary’s monetary assets, liabilities and operating results, and our interest expense.

(b)

Retention bonus expenses consists of retention bonuses for certain TVS employees.

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO NON-GAAP FREE CASH FLOW

 

 

Three months ended June 30,

 

Six months ended June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Net cash provided by operating activities

$

1,234

 

 

$

580

 

 

$

5,886

 

 

$

948

 

Loss on foreign exchange, net

 

(161

)

 

 

 

 

 

(251

)

 

 

 

Capital expenditures

 

(2,326

)

 

 

(2,600

)

 

 

(4,867

)

 

 

(5,780

)

Free Cash Flow

$

(1,253

)

 

$

(2,020

)

 

$

768

 

 

$

(4,832

)

 

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