DoubleVerify Reports Second Quarter 2024 Financial Results
Increased Revenue by 17% Year-over-Year to $155.9 Million, Driven by Global Growth in Social and CTV Measurement
Achieved Net Income of $7.5 Million and Adjusted EBITDA of $46.8 Million, representing a 30% Adjusted EBITDA margin
Raised Midpoints of Full-Year 2024 Revenue and Adjusted EBITDA Guidance Ranges
DoubleVerify ("DV") (NYSE:DV), the leading software platform for digital media measurement, data and analytics, today announced financial results for the second quarter ended June 30, 2024.
"The second quarter was pivotal for DV as we re-accelerated our revenue growth momentum driven by continued success in social and CTV measurement, and bolstered by the strength of our retail media platform business," said Mark Zagorski, CEO of DoubleVerify. "Our broad portfolio of differentiated products, including our latest performance solutions, Scibids AI and Authentic Attention, helped deliver double-digit growth across all three revenue lines and all key media environments. Our enterprise pipeline has never been stronger, with both greenfield and competitive opportunities set to fuel our resurgent business in the coming quarters. DV's independent solutions provide unparalleled ROI for our customers, allowing us to continue to gain significant market share, solidifying our position as the industry leader and driving higher value for all our stakeholders."
Second Quarter 2024 Financial Highlights:
(All comparisons are to the second quarter of 2023)
- Total revenue of $155.9 million, an increase of 17%.
- Activation revenue of $87.5 million, an increase of 12%.
-
Measurement revenue of $54.8 million, an increase of 22%.
- Social measurement revenue increased by 44%.
- International measurement revenue increased by 29%, with 35% growth in EMEA and 20% growth in APAC.
- Media Transactions Measured ("MTM") for CTV increased by 55%.
- Supply-side revenue of $13.6 million, an increase of 26%.
- Net income of $7.5 million and adjusted EBITDA of $46.8 million, which represented a 30% adjusted EBITDA margin.
Second Quarter and Recent Business Highlights:
-
Grew Total Advertiser revenue by 16% year-over-year in the second quarter.
- MTM increased by 22% year-over-year.
- Measured Transaction Fee (MTF) declined 5% year-over-year primarily due to product and geographic mix. Measurement volumes, which are lower-priced than activation, increased relative to the prior-year period, driven by strong growth in social and international measurement.
- Continued to achieve a Gross Revenue Retention rate of over 95% in the second quarter.
- Announced authorization of the repurchase of $150 million common stock. Repurchased 1.4 million shares for a total of $25 million in the second quarter, and an additional 1.3 million shares for $25 million subsequent to quarter end. As of July 30, 2024, $100 million remains available for repurchases under the Repurchase Program.
-
Drove global market share growth through product upsells, international expansion, and new enterprise logo wins.
- Notable second-quarter expansions and wins include: Universal Pictures, Panera, Subway, Dyson, Philip Morris, Bacardi, Anheuser-Busch InBev, Amazon Books, Honda Mobility, JTI and Ajinomoto.
- Expanded YouTube's brand safety and suitability measurement to include Performance Max and Demand Gen, offering comprehensive coverage of Google's high-performance solutions that optimize real-time performance for better conversions and budget efficiency.
- Expanded partnerships with Pinterest and Reddit to offer global brand safety and suitability measurement in multiple languages, leveraging DV's AI-powered Universal Content Intelligence.
- Partnered with Hakuhodo DY Media Partners, a global top ten integrated marketing and innovation company, to harness DV's AI powered pre-bid social and open web activation tools for enhancing ad effectiveness and media quality.
- Launched the industry's only Transparency Center to foster digital trust by offering comprehensive resources that demystify digital media verification, dispel common misconceptions, and spotlight critical trends in ad quality and performance.
- Published DV's 2024 Global Insights Report to highlight key industry trends, emphasizing attention metrics, AI's transformative impact on digital advertising, the surge in MFA content, the rise of RMNs with specialized inventory, and the role of responsible media buying in reducing carbon emissions. The report has garnered over 1,000 downloads since launch globally.
"In the second quarter, we achieved the high end of our revenue guidance and exceeded our adjusted EBITDA expectations, achieving year-over-year revenue growth of 17%, revenue less cost of sales of 83%, and an adjusted EBITDA margin of 30%," said Nicola Allais, CFO of DoubleVerify. "Our strong performance was driven by multiple products across activation, measurement, and supply-side revenue that leveraged growth across social, CTV, and retail media environments. As a result of our ongoing momentum, we are pleased to be raising the mid-points of our full-year revenue and adjusted EBITDA guidance. We remain confident in our industry-leading revenue growth and profitability in the second half as we continue to outpace the digital advertising industry and gain market share."
Third Quarter and Full-Year 2024 Guidance:
DoubleVerify anticipates Revenue and Adjusted EBITDA to be in the following ranges:
Third Quarter 2024:
- Revenue of $167 to $171 million, a year-over-year increase of 17% at the midpoint.
- Adjusted EBITDA of $49 to $53 million, representing a 30% margin at the midpoint.
Full Year 2024:
- Revenue of $667 to $675 million, a year-over-year increase of 17% at the midpoint.
- Adjusted EBITDA of $206 to $214 million, representing a 31% margin at the midpoint.
With respect to the Company's expectations under "Third Quarter and Full Year 2024 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 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 second quarter 2024 financial results at 4:30 p.m. Eastern Time today, July 30, 2024. 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.
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. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
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As of |
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As of |
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(in thousands, except per share data) |
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June 30, 2024 |
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December 31, 2023 |
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Assets: |
|
|
|
|
|
|
||
Current assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
256,066 |
|
|
$ |
310,131 |
|
Short-term investments |
|
|
82,754 |
|
|
|
— |
|
Trade receivables, net of allowances for doubtful accounts of $9,564 and $9,442 as of June 30, 2024 and December 31, 2023, respectively |
|
|
187,761 |
|
|
|
206,941 |
|
Prepaid expenses and other current assets |
|
|
32,977 |
|
|
|
15,930 |
|
Total current assets |
|
|
559,558 |
|
|
|
533,002 |
|
Property, plant and equipment, net |
|
|
64,521 |
|
|
|
58,020 |
|
Operating lease right-of-use assets, net |
|
|
66,155 |
|
|
|
60,470 |
|
Goodwill |
|
|
431,496 |
|
|
|
436,008 |
|
Intangible assets, net |
|
|
125,420 |
|
|
|
140,883 |
|
Deferred tax assets |
|
|
23,766 |
|
|
|
13,077 |
|
Other non-current assets |
|
|
1,727 |
|
|
|
1,571 |
|
Total assets |
|
$ |
1,272,643 |
|
|
$ |
1,243,031 |
|
Liabilities and Stockholders' Equity: |
|
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|
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Current liabilities |
|
|
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|
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|
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Trade payables |
|
$ |
10,604 |
|
|
$ |
12,932 |
|
Accrued expenses |
|
|
44,136 |
|
|
|
44,264 |
|
Operating lease liabilities, current |
|
|
10,113 |
|
|
|
9,029 |
|
Income tax liabilities |
|
|
832 |
|
|
|
5,833 |
|
Current portion of finance lease obligations |
|
|
2,393 |
|
|
|
2,934 |
|
Other current liabilities |
|
|
11,447 |
|
|
|
8,863 |
|
Total current liabilities |
|
|
79,525 |
|
|
|
83,855 |
|
Operating lease liabilities, non-current |
|
|
76,265 |
|
|
|
71,563 |
|
Finance lease obligations |
|
|
1,844 |
|
|
|
2,865 |
|
Deferred tax liabilities |
|
|
7,031 |
|
|
|
8,119 |
|
Other non-current liabilities |
|
|
2,815 |
|
|
|
2,690 |
|
Total liabilities |
|
|
167,480 |
|
|
|
169,092 |
|
Commitments and contingencies (Note 15) |
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Stockholders' equity |
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Common stock, $0.001 par value, 1,000,000 shares authorized, 172,634 shares issued and 171,244 outstanding as of June 30, 2024; 1,000,000 shares authorized, 171,168 shares issued and 171,146 outstanding as of December 31, 2023 |
|
|
173 |
|
|
|
171 |
|
Additional paid-in capital |
|
|
926,062 |
|
|
|
878,331 |
|
Treasury stock, at cost, 1,390 shares and 22 shares as of June 30, 2024 and December 31, 2023, respectively |
|
|
(25,443 |
) |
|
|
(743 |
) |
Retained earnings |
|
|
213,613 |
|
|
|
198,983 |
|
Accumulated other comprehensive loss, net of income taxes |
|
|
(9,242 |
) |
|
|
(2,803 |
) |
Total stockholders' equity |
|
|
1,105,163 |
|
|
|
1,073,939 |
|
Total liabilities and stockholders' equity |
|
$ |
1,272,643 |
|
|
$ |
1,243,031 |
|
DoubleVerify Holdings, Inc. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED) |
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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(in thousands, except per share data) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
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Revenue |
|
$ |
155,890 |
|
|
$ |
133,744 |
|
|
$ |
296,672 |
|
|
$ |
256,338 |
|
Cost of revenue (exclusive of depreciation and amortization shown separately below) |
|
|
26,102 |
|
|
|
26,191 |
|
|
|
52,720 |
|
|
|
50,143 |
|
Product development |
|
|
39,806 |
|
|
|
31,941 |
|
|
|
76,200 |
|
|
|
60,496 |
|
Sales, marketing and customer support |
|
|
44,863 |
|
|
|
31,537 |
|
|
|
82,735 |
|
|
|
57,249 |
|
General and administrative |
|
|
23,066 |
|
|
|
19,755 |
|
|
|
45,141 |
|
|
|
39,943 |
|
Depreciation and amortization |
|
|
11,004 |
|
|
|
9,676 |
|
|
|
21,932 |
|
|
|
18,659 |
|
Income from operations |
|
|
11,049 |
|
|
|
14,644 |
|
|
|
17,944 |
|
|
|
29,848 |
|
Interest expense |
|
|
233 |
|
|
|
247 |
|
|
|
465 |
|
|
|
503 |
|
Other income, net |
|
|
(2,064 |
) |
|
|
(2,476 |
) |
|
|
(4,336 |
) |
|
|
(5,210 |
) |
Income before income taxes |
|
|
12,880 |
|
|
|
16,873 |
|
|
|
21,815 |
|
|
|
34,555 |
|
Income tax expense |
|
|
5,406 |
|
|
|
4,034 |
|
|
|
7,185 |
|
|
|
9,541 |
|
Net income |
|
$ |
7,474 |
|
|
$ |
12,839 |
|
|
$ |
14,630 |
|
|
$ |
25,014 |
|
Earnings per share: |
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||||
Basic |
|
$ |
0.04 |
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|
$ |
0.08 |
|
|
$ |
0.09 |
|
|
$ |
0.15 |
|
Diluted |
|
$ |
0.04 |
|
|
$ |
0.07 |
|
|
$ |
0.08 |
|
|
$ |
0.15 |
|
Weighted-average common stock outstanding: |
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|
|
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|
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|
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|
||||
Basic |
|
|
171,628 |
|
|
|
166,540 |
|
|
|
171,467 |
|
|
|
166,088 |
|
Diluted |
|
|
175,961 |
|
|
|
172,488 |
|
|
|
176,850 |
|
|
|
172,129 |
|
Comprehensive income: |
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|
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Net income |
|
$ |
7,474 |
|
|
$ |
12,839 |
|
|
$ |
14,630 |
|
|
$ |
25,014 |
|
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
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Foreign currency cumulative translation adjustment |
|
|
(1,814 |
) |
|
|
(377 |
) |
|
|
(6,439 |
) |
|
|
816 |
|
Total comprehensive income |
|
$ |
5,660 |
|
|
$ |
12,462 |
|
|
$ |
8,191 |
|
|
$ |
25,830 |
|
DoubleVerify Holdings, Inc. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) |
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Accumulated |
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Other |
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Comprehensive |
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Additional |
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(Loss) Income |
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Total |
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|
|
Common Stock |
|
Treasury Stock |
|
Paid-in |
|
Retained |
|
Net of |
|
Stockholders' |
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(in thousands) |
|
Shares |
|
Amount |
|
Shares |
|
Amount |
|
Capital |
|
Earnings |
|
Income Taxes |
|
Equity |
||||||||||||||
Balance as of January 1, 2024 |
|
171,168 |
|
|
$ |
171 |
|
|
22 |
|
|
$ |
(743 |
) |
|
$ |
878,331 |
|
|
$ |
198,983 |
|
|
$ |
(2,803 |
) |
|
$ |
1,073,939 |
|
Foreign currency translation adjustment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(4,625 |
) |
|
|
(4,625 |
) |
Shares repurchased for settlement of employee tax withholdings |
|
— |
|
|
|
— |
|
|
48 |
|
|
|
(1,792 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,792 |
) |
Stock-based compensation expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
20,718 |
|
|
|
— |
|
|
|
— |
|
|
|
20,718 |
|
Common stock issued upon exercise of stock options |
|
153 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
1,695 |
|
|
|
— |
|
|
|
— |
|
|
|
1,695 |
|
Common stock issued upon vesting of restricted stock units |
|
435 |
|
|
|
1 |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Treasury stock reissued upon settlement of equity awards |
|
— |
|
|
|
— |
|
|
(38 |
) |
|
|
1,389 |
|
|
|
(1,389 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net income |
|
— |
|
|
— |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,156 |
|
|
— |
|
|
|
7,156 |
|
|||
Balance as of March 31, 2024 |
|
171,756 |
|
|
|
172 |
|
|
32 |
|
|
|
(1,146 |
) |
|
|
899,354 |
|
|
|
206,139 |
|
|
|
(7,428 |
) |
|
|
1,097,091 |
|
Foreign currency translation adjustment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,814 |
) |
|
|
(1,814 |
) |
Shares repurchased for settlement of employee tax withholdings |
|
— |
|
|
|
— |
|
|
30 |
|
|
|
(660 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(660 |
) |
Stock-based compensation expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
25,315 |
|
|
|
— |
|
|
|
— |
|
|
|
25,315 |
|
Common stock issued under employee purchase plan |
|
124 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
1,914 |
|
|
|
— |
|
|
|
— |
|
|
|
1,914 |
|
Common stock issued upon exercise of stock options |
|
126 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
870 |
|
|
|
— |
|
|
|
— |
|
|
|
870 |
|
Common stock issued upon vesting of restricted stock units |
|
628 |
|
|
|
1 |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Shares repurchased under the Repurchase Program |
|
— |
|
|
|
— |
|
|
1,369 |
|
|
|
(25,027 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(25,027 |
) |
Treasury stock reissued upon settlement of equity awards |
|
— |
|
|
|
— |
|
|
(41 |
) |
|
|
1,390 |
|
|
|
(1,390 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net income |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,474 |
|
|
|
— |
|
|
|
7,474 |
|
Balance as of June 30, 2024 |
|
172,634 |
|
|
$ |
173 |
|
|
1,390 |
|
|
$ |
(25,443 |
) |
|
$ |
926,062 |
|
|
$ |
213,613 |
|
|
$ |
(9,242 |
) |
|
$ |
1,105,163 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of January 1, 2023 |
|
165,448 |
|
|
$ |
165 |
|
|
31 |
|
|
$ |
(796 |
) |
|
$ |
756,299 |
|
|
$ |
127,517 |
|
|
$ |
(6,326 |
) |
|
$ |
876,859 |
|
Foreign currency translation adjustment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,193 |
|
|
|
1,193 |
|
Shares repurchased for settlement of employee tax withholdings |
|
— |
|
|
|
— |
|
|
30 |
|
|
|
(787 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(787 |
) |
Stock-based compensation expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
11,992 |
|
|
|
— |
|
|
|
— |
|
|
|
11,992 |
|
Common stock issued upon exercise of stock options |
|
527 |
|
|
|
1 |
|
|
— |
|
|
|
— |
|
|
|
1,765 |
|
|
|
— |
|
|
|
— |
|
|
|
1,766 |
|
Common stock issued upon vesting of restricted stock units |
|
182 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Treasury stock reissued upon settlement of equity awards |
|
— |
|
|
|
— |
|
|
(35 |
) |
|
|
914 |
|
|
|
(914 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net income |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,175 |
|
|
|
— |
|
|
|
12,175 |
|
Balance as of March 31, 2023 |
|
166,157 |
|
|
|
166 |
|
|
26 |
|
|
|
(669 |
) |
|
|
769,142 |
|
|
|
139,692 |
|
|
|
(5,133 |
) |
|
|
903,198 |
|
Foreign currency translation adjustment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(377 |
) |
|
|
(377 |
) |
Shares repurchased for settlement of employee tax withholdings |
|
— |
|
|
|
— |
|
|
57 |
|
|
|
(1,966 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,966 |
) |
Stock-based compensation expense |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
15,399 |
|
|
|
— |
|
|
|
— |
|
|
|
15,399 |
|
Common stock issued under employee purchase plan |
|
49 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
1,138 |
|
|
|
— |
|
|
|
— |
|
|
|
1,138 |
|
Common stock issued upon exercise of stock options |
|
711 |
|
|
|
1 |
|
|
— |
|
|
|
— |
|
|
|
3,990 |
|
|
|
— |
|
|
|
— |
|
|
|
3,991 |
|
Common stock issued upon vesting of restricted stock units |
|
333 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Treasury stock reissued upon settlement of equity awards |
|
— |
|
|
|
— |
|
|
(67 |
) |
|
|
2,107 |
|
|
|
(2,107 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net income |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,839 |
|
|
|
— |
|
|
|
12,839 |
|
Balance as of June 30, 2023 |
|
167,250 |
|
|
$ |
167 |
|
|
16 |
|
|
$ |
(528 |
) |
|
$ |
787,562 |
|
|
$ |
152,531 |
|
|
$ |
(5,510 |
) |
|
$ |
934,222 |
|
DoubleVerify Holdings, Inc. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
||||||||
|
|
|
|
|
|
|
||
|
|
Six Months Ended |
||||||
|
|
June 30, |
||||||
(in thousands) |
|
2024 |
|
2023 |
||||
Operating activities: |
|
|
|
|
|
|
||
Net income |
|
$ |
14,630 |
|
|
$ |
25,014 |
|
Adjustments to reconcile net income to net cash provided by operating activities |
|
|
|
|
|
|
||
Bad debt expense |
|
|
1,453 |
|
|
|
3,706 |
|
Depreciation and amortization expense |
|
|
21,932 |
|
|
|
18,659 |
|
Amortization of debt issuance costs |
|
|
147 |
|
|
|
147 |
|
Non-cash lease expense |
|
|
3,191 |
|
|
|
3,293 |
|
Deferred taxes |
|
|
(11,530 |
) |
|
|
(16,639 |
) |
Stock-based compensation expense |
|
|
44,956 |
|
|
|
26,980 |
|
Interest (income) expense, net |
|
|
(784 |
) |
|
|
25 |
|
Loss on disposal of fixed assets |
|
|
— |
|
|
|
5 |
|
Other |
|
|
1,582 |
|
|
|
209 |
|
Changes in operating assets and liabilities |
|
|
|
|
|
|
||
Trade receivables |
|
|
16,397 |
|
|
|
(12,214 |
) |
Prepaid expenses and other assets |
|
|
(17,208 |
) |
|
|
(11,168 |
) |
Trade payables |
|
|
(2,076 |
) |
|
|
2,126 |
|
Accrued expenses and other liabilities |
|
|
(5,035 |
) |
|
|
(7,979 |
) |
Net cash provided by operating activities |
|
|
67,655 |
|
|
|
32,164 |
|
Investing activities: |
|
|
|
|
|
|
||
Purchase of property, plant and equipment |
|
|
(13,558 |
) |
|
|
(7,671 |
) |
Purchase of short-term investments |
|
|
(81,937 |
) |
|
|
— |
|
Net cash used in investing activities |
|
|
(95,495 |
) |
|
|
(7,671 |
) |
Financing activities: |
|
|
|
|
|
|
||
Proceeds from revolving credit facility |
|
|
— |
|
|
|
50,000 |
|
Payments to revolving credit facility |
|
|
— |
|
|
|
(50,000 |
) |
Proceeds from common stock issued upon exercise of stock options |
|
|
2,565 |
|
|
|
5,757 |
|
Proceeds from common stock issued under employee purchase plan |
|
|
1,914 |
|
|
|
1,138 |
|
Finance lease payments |
|
|
(1,562 |
) |
|
|
(1,028 |
) |
Shares repurchased under the Repurchase Program |
|
|
(25,027 |
) |
|
|
— |
|
Shares repurchased for settlement of employee tax withholdings |
|
|
(2,452 |
) |
|
|
(2,753 |
) |
Net cash (used in) provided by financing activities |
|
|
(24,562 |
) |
|
|
3,114 |
|
Effect of exchange rate changes on cash and cash equivalents and restricted cash |
|
|
(850 |
) |
|
|
15 |
|
Net (decrease) increase in cash, cash equivalents, and restricted cash |
|
|
(53,252 |
) |
|
|
27,622 |
|
Cash, cash equivalents, and restricted cash - Beginning of period |
|
|
310,257 |
|
|
|
267,938 |
|
Cash, cash equivalents, and restricted cash - End of period |
|
$ |
257,005 |
|
|
$ |
295,560 |
|
|
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
256,066 |
|
|
$ |
295,437 |
|
Restricted cash (included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets) |
|
|
939 |
|
|
|
123 |
|
Total cash and cash equivalents and restricted cash |
|
$ |
257,005 |
|
|
$ |
295,560 |
|
Supplemental cash flow information: |
|
|
|
|
|
|
||
Cash paid for taxes |
|
$ |
29,491 |
|
|
$ |
41,284 |
|
Cash paid for interest |
|
$ |
350 |
|
|
$ |
389 |
|
Non-cash investing and financing activities: |
|
|
|
|
|
|
||
Right-of-use assets obtained in exchange for new operating lease liabilities, net of impairments and tenant improvement allowances |
|
$ |
9,211 |
|
|
$ |
1,261 |
|
Acquisition of equipment under finance lease |
|
$ |
— |
|
|
$ |
5,479 |
|
Capital assets financed by accounts payable and accrued expenses |
|
$ |
18 |
|
|
$ |
480 |
|
Stock-based compensation included in capitalized software development costs |
|
$ |
1,064 |
|
|
$ |
411 |
|
Comparison of the Three and Six Months Ended June 30, 2024 and June 30, 2023
Revenue
|
Three Months Ended
|
|
Change |
|
Change |
|
Six Months Ended
|
|
Change |
|
Change |
||||||||||||||||||
|
2024 |
|
2023 |
|
$ |
|
% |
|
2024 |
|
2023 |
|
$ |
|
% |
||||||||||||||
|
(In Thousands) |
|
|
|
|
|
|
|
(In Thousands) |
|
|
|
|
|
|
||||||||||||||
Revenue by customer type: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Activation |
$ |
87,471 |
|
|
$ |
77,942 |
|
|
$ |
9,529 |
|
|
12 |
% |
|
$ |
166,793 |
|
|
$ |
147,834 |
|
|
$ |
18,959 |
|
|
13 |
% |
Measurement |
|
54,817 |
|
|
44,989 |
|
|
9,828 |
|
22 |
|
|
|
104,092 |
|
|
86,374 |
|
|
17,718 |
|
21 |
|
||||||
Supply-side customer |
|
13,602 |
|
|
|
10,813 |
|
|
|
2,789 |
|
|
26 |
|
|
|
25,787 |
|
|
|
22,130 |
|
|
|
3,657 |
|
|
17 |
|
Total revenue |
$ |
155,890 |
|
|
$ |
133,744 |
|
|
$ |
22,146 |
|
|
17 |
% |
|
$ |
296,672 |
|
|
$ |
256,338 |
|
|
$ |
40,334 |
|
|
16 |
% |
Adjusted EBITDA
In addition to results determined in accordance with GAAP, management believes that certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, are useful in evaluating our business. Adjusted EBITDA Margin is calculated 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 June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
|
(In Thousands) |
|
(In Thousands) |
||||||||||||
Net income |
$ |
7,474 |
|
|
$ |
12,839 |
|
|
$ |
14,630 |
|
|
$ |
25,014 |
|
Net income margin |
|
5 |
% |
|
|
10 |
% |
|
|
5 |
% |
|
|
10 |
% |
Depreciation and amortization |
|
11,004 |
|
|
|
9,676 |
|
|
|
21,932 |
|
|
|
18,659 |
|
Stock-based compensation |
|
24,715 |
|
|
|
15,167 |
|
|
|
44,956 |
|
|
|
26,980 |
|
Interest expense |
|
233 |
|
|
|
247 |
|
|
|
465 |
|
|
|
503 |
|
Income tax expense |
|
5,406 |
|
|
|
4,034 |
|
|
|
7,185 |
|
|
|
9,541 |
|
M&A and restructuring (recoveries) costs (a) |
|
(11 |
) |
|
|
700 |
|
|
|
— |
|
|
|
700 |
|
Offering and secondary offering costs (b) |
|
10 |
|
|
|
122 |
|
|
|
68 |
|
|
|
309 |
|
Other recoveries (c) |
|
— |
|
|
|
(266 |
) |
|
|
— |
|
|
|
(533 |
) |
Other income (d) |
|
(2,064 |
) |
|
|
(2,476 |
) |
|
|
(4,336 |
) |
|
|
(5,210 |
) |
Adjusted EBITDA |
$ |
46,767 |
|
|
$ |
40,043 |
|
|
$ |
84,900 |
|
|
$ |
75,963 |
|
Adjusted EBITDA margin |
|
30 |
% |
|
|
30 |
% |
|
|
29 |
% |
|
|
30 |
% |
| _______________ | ||
(a) |
|
M&A and restructuring (recoveries) costs for the three and six months ended June 30, 2024 and June 30, 2023 consist of transaction costs related to the acquisition of Scibids. |
(b) |
|
Offering and secondary offering costs for the three and six months ended June 30, 2024 and June 30, 2023 consist of third-party costs incurred for underwritten secondary public offerings by certain stockholders of the Company. |
(c) |
|
Other recoveries for the three and six months ended June 30, 2023 consist of sublease income for leased office space. |
(d) |
|
Other income for the three and six months ended June 30, 2024 and June 30, 2023 consist of interest income earned on interest-bearing monetary assets, and the impact of changes in foreign currency exchange rates. |
We use Adjusted EBITDA and Adjusted EBITDA Margin as measures of operational efficiency to understand and evaluate our core business operations. We believe that these non-GAAP financial measures are useful to investors for period-to-period comparisons of the core business and for understanding and evaluating trends in operating results on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for an analysis of our results as reported under GAAP. Some of the limitations of these measures are:
- they do not reflect changes in, or cash requirements for, working capital needs;
- Adjusted EBITDA does not reflect capital expenditures or future requirements for capital expenditures or contractual commitments;
- they do not reflect income tax expense or the cash requirements to pay income taxes;
- they do not reflect interest expense or the cash requirements necessary to service interest or principal debt payments; and
- although depreciation and amortization are non-cash charges related mainly to intangible assets, certain assets being depreciated and amortized will have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.
In addition, other companies in the industry may calculate these non-GAAP financial measures differently, therefore limiting their usefulness as a comparative measure. You should compensate for these limitations by relying primarily on our GAAP results and using the non-GAAP financial measures only supplementally.
Total stock-based compensation expense recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
June 30, |
|
June 30, |
||||||||||||
(in thousands) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Product development |
|
$ |
9,734 |
|
|
$ |
5,975 |
|
|
$ |
17,107 |
|
|
$ |
10,354 |
|
Sales, marketing and customer support |
|
|
7,503 |
|
|
|
4,746 |
|
|
|
13,439 |
|
|
|
8,253 |
|
General and administrative |
|
|
7,478 |
|
|
4,446 |
|
|
14,410 |
|
|
8,373 |
||||
Total stock-based compensation |
|
$ |
24,715 |
|
|
$ |
15,167 |
|
|
$ |
44,956 |
|
|
$ |
26,980 |
|
Forward-Looking Statements
This press release includes "forward-looking statements". Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Any statements in this press release regarding future revenues, earnings, margins, financial performance or results of operations (including the guidance provided under "Third Quarter and Full-Year 2024 Guidance"), and any other statements that are not historical facts are forward-looking statements. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. These risks, uncertainties, assumptions and other factors include, but are not limited to, the competitiveness of our solutions amid technological developments or evolving industry standards, the competitiveness of our market, system failures, security breaches, cyberattacks or natural disasters, economic downturns and unstable market conditions, our ability to collect payments, data privacy legislation and regulation, public criticism of digital advertising technology, our international operations, our use of "open source" software, our limited operating history and the potential for our revenues and results of operations to fluctuate in the future. Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make.
Further information on these and additional risks, uncertainties, and other factors that could cause actual outcomes and results to differ materially from those included in or contemplated by the forward-looking statements contained in this press release are included under the caption "Risk Factors" in the Company's Annual Report on Form 10-K filed with the SEC on February 28, 2024 and other filings and reports we make with the SEC from time to time.
We have based our forward-looking statements on our management's beliefs and assumptions based on information available to our management at the time the statements are made. Any forward-looking information presented herein is made only as of the date of this press release, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
About DoubleVerify
DoubleVerify ("DV") (NYSE:DV) is the industry's leading media effectiveness platform that leverages AI to drive superior outcomes for global brands. By creating more effective, transparent ad transactions, we make the digital advertising ecosystem stronger, safer and more secure, thereby preserving the fair value exchange between buyers and sellers of digital media. Learn more at www.doubleverify.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240730326812/en/