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    ironSource Announces Fourth Quarter and Full Year 2021 Financial Results

    2/16/22 7:30:00 AM ET
    $IS
    Get the next $IS alert in real time by email

    Q4 Revenue of $158 million, 46% year-over-year growth

    Q4 Adjusted EBITDA1 of $57 million, 76% year-over-year growth; 36% Adjusted EBITDA Margin1

    Full year 2021 Revenue of $553 million, 67% year-over-year growth; full year Adjusted EBITDA of $194 million, 87% year-over-year growth

    Dollar-based net expansion rate of 154% for Q4

    ironSource (NYSE:IS) ("ironSource" or the "Company"), a leading business platform for the App Economy, today announced financial results for the fourth quarter and fiscal year ended December 31, 2021. In addition, the Company provided its initial outlook for the first quarter ending March 31, 2022 and guidance for the full fiscal year 2022.

    "Our fourth quarter results capped an outstanding 2021 in which we achieved record yearly revenue of $553 million, which we believe demonstrates steadily-growing demand for ironSource's unique set of offerings designed to help businesses take advantage of the fast-expanding App Economy. Equally important, we have remained focused on our financial fundamentals as we transitioned from being private to being a public company in 2021, achieving 67% year-over-year revenue growth along with 35% Adjusted EBITDA margin," said Tomer Bar Zeev, CEO and co-founder of ironSource.

    Fourth Quarter 2021 Financial Highlights:

    • Total revenue of $158 million, an increase of 46% year-over-year.
    • GAAP Net Income of $21 million.
    • Adjusted EBITDA1 of $57 million, an increase of 76% year-over-year.
    • Adjusted EBITDA margin1 of 36%.
    • Dollar-based net expansion rate of 154%.
    • 358 customers each contributed more than $100,000 of revenue in the trailing 12 months, representing 95% of total revenue for the fourth quarter ended December 31, 2021.
    • Net cash for the fourth quarter ended December 31, 2021 was $782 million.

    "We have worked hard to further cement our market leadership position in 2021, and are excited about the significant near- and long-term growth opportunities in our total addressable market as we look at the years ahead. We will work to increase our penetration in apps beyond games as those publishers look to adopt the monetization and marketing playbook used by mobile games to boost profitability. We will also continue to enhance and expand the overall set of solutions we offer our customers, such as with our cross-channel marketing solution, to increase our share of wallet."

    Full Year 2021 Financial Highlights:

    • Total revenue of $553 million, an increase of 67% year-over-year.
    • GAAP Net Income of $60 million.
    • Adjusted EBITDA1 of $194 million, an increase of 87% year-over-year.
    • Adjusted EBITDA margin1 of 35%.
    • Net cash for the full year ended December 31, 2021 was $782 million.

    Corporate Highlights:

    • Closed the previously-announced acquisitions of Tapjoy and Bidalgo. Acquisitions that aim to provide deeper market presence across the entire App Economy beyond games, additional scale and SDK footprint, and an increase in the overall available TAM.
    • Announced the launch of App Analytics, centralizing even more critical app business functions within our platform, and expanding the number of roles ironSource can serve within an app-based business - from monetization and marketing managers, to game designers, product managers, and the executive team.
    • Expanded the Aura customer base with signed partnership with two new tier 1 telecom operators to integrate the Aura solution suite on its devices.

    Business Outlook:

    ironSource is introducing first quarter of 2022 guidance and guidance for the fiscal year ending December 31, 2022.

    First quarter of fiscal 2022:

    • Total revenue is expected to be between $180m and $185m, representing 52% year-over-year growth at the midpoint.
    • Adjusted EBITDA2 is expected to be between $56m and $58m, representing 44% year-over-year growth at the midpoint.

    Full Year fiscal 2022:

    • Total revenue is expected to be in the range of $790m to $820m, representing 45% year-over-year growth at the midpoint.
    • Adjusted EBITDA2 is expected to be in the range of $255m to $265m, representing 34% year-over-year growth at the midpoint.
    ($ in millions)

     

    Q122 Guidance

     

    FY22 Guidance

    Revenue

     

    $180-$185

     

    $790-$820

    Revenue Y/Y growth Rate

     

    50%-55%

     

    43%-48%

    Adjusted EBITDA

     

    $56-$58

     

    $255-$265

    Adjusted EBITDA Margin

     

    30%-32%

     

    31%-34%

    Fully Diluted shares outstanding

     

    ~1.1B shares

     

     

    Conference Call Information:

    ironSource will host a conference call and live webcast for analysts and investors at 8:30 a.m. Eastern Time on February 16, 2022.

    Parties in the United States can access the call by dialing +1 844-200-6205, using conference code 510139. International parties can access the call by dialing +1 929-526-1599, using conference code 510139. This press release and the accompanying presentation materials will be available on the Company's website at http://www.is.com/ shortly before the presentation begins.

    ____________

    1 Adjusted EBITDA and Adjusted EBITDA margin are financial measures that are not required by, or presented in accordance with, U.S. GAAP. Please see Annex A of this release for a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure stated in accordance with GAAP for each of the periods presented. We calculate Adjusted EBITDA margin as Adjusted EBITDA divided by revenue.

    2 Adjusted EBITDA is a financial measure that is not required by, or presented in accordance with, U.S. GAAP. The Company has not reconciled its Adjusted EBITDA guidance to net income because net income is not accessible on a forward-looking basis and, accordingly, a reconciliation to net income is not available without unreasonable effort. See "Key Performance Metrics and Non-GAAP Financial Measures" for more information.

    The webcast will be posted on ironSource's investor relations website at investors.is.com shortly after the call and will remain accessible for one year. A telephonic replay of the conference call will be available through March 2, 2022. To access the replay, parties in the United States can dial +1 866-813-9403, using conference code 967312. International parties can access the replay by dialing +44 204-525-0658, using conference code 967312.

    Q1 Conference Schedule:

    ironSource management is scheduled to participate in the Morgan Stanley Technology, Media and Telecom conference on March 9th in San Francisco.

    Key Performance Metrics and Non-GAAP Financial Measures

    ironSource monitors the key business metrics set forth below to help evaluate the business and growth trends, establish budgets, measure the effectiveness of sales and marketing efforts, and assess operational efficiencies. The calculation of the key metrics discussed below may differ from other similarly-titled metrics used by other companies, securities analysts or investors.

    Customers Contributing More than $100,000 of Revenue

    ironSource's larger customer relationships drive scale, improved unit economics and operating leverage in its business model, which improves ironSource's solutions and thereby increases the value proposition to all of ironSource's customers. To measure ironSource's ability to scale with its customers and attract large enterprises to its platform, ironSource counts the number of customers that contributed more than $100,000 in revenue in the trailing 12 months. ironSource's gross customer retention rate is calculated by comparing two twelve-month periods to see how many customers in the previous period remain active customers in the current period. ironSource's customer count is subject to adjustments for acquisitions, consolidations, spin-offs and other market activity.

    Dollar-Based Net Expansion Rate

    ironSource believes the growth in the use of its platform by existing customers is an important measure of the health of its business and future growth prospects. ironSource monitors its performance in this area using an indicator management refers to as dollar-based net expansion rate. ironSource calculates dollar-based net expansion rate for a period by dividing current period revenue from a set of customers by prior period revenue of the same set of customers. Prior period revenue is the trailing 12-month revenue measured as of such prior period end. Current period revenue is the trailing 12-month revenue from the same customers as of the current period end. Management's calculation of dollar-based net expansion rate includes the effect of any customer renewals, expansion, contraction and churn, but excludes revenue from new customers.

    Adjusted EBITDA and Adjusted EBITDA Margin

    ironSource defines Adjusted EBITDA as income from continuing operations, net of income taxes, as adjusted for income taxes, financial expenses, net and depreciation and amortization, further adjusted for assets impairment, share-based compensation expense and fair value adjustment related to contingent consideration, acquisition-related costs and offering costs. ironSource defines Adjusted EBITDA Margin as Adjusted EBITDA calculated as a percentage of revenue. Adjusted EBITDA and Adjusted EBITDA Margin are included in this press release because they are key metrics used by management and our board of directors to assess our financial performance. Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. ironSource management believes that Adjusted EBITDA and Adjusted EBITDA Margin are appropriate measures of operating performance because each eliminates the impact of expenses that do not relate directly to the performance of the underlying business.

    Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures of our financial performance and should not be considered as alternatives to net loss as a measure of financial performance, as alternatives to cash flows from operations as a measure of liquidity, or as alternatives to any other performance measure derived in accordance with GAAP. Adjusted EBITDA and Adjusted EBITDA Margin should not be construed as inferences that our future results will be unaffected by unusual or other items. Additionally, Adjusted EBITDA and Adjusted EBITDA Margin are not intended to be measures of free cash flow for management's discretionary use, as they do not reflect our tax payments and certain other cash costs that may recur in the future, including, among other things, cash requirements for costs to replace assets being depreciated and amortized. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA and Adjusted EBITDA Margin as supplemental measures. Our measures of Adjusted EBITDA and Adjusted EBITDA Margin are not necessarily comparable to similarly-titled captions of other companies due to different methods of calculation.

    For more information on the non-GAAP financial measures, please see the reconciliation tables provided below. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company has not reconciled its Adjusted EBITDA guidance to net income because net income is not accessible on a forward-looking basis. Certain items that impact Adjusted EBITDA are out of the Company's control and/or cannot be reasonably predicted. These items include, but are not limited to, share based compensation expenses. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. Accordingly, a reconciliation to net income is not available without unreasonable effort. For more information regarding the non-GAAP financial measures discussed in this release, please see Annex A of this release for the reconciliations of GAAP financial measures to non-GAAP financial measures.

    About ironSource

    ironSource is a leading business platform for the App Economy. App developers use ironSource's platform to turn their apps into successful, scalable businesses, leveraging a comprehensive set of software solutions which help them grow and engage users, monetize content, and analyze and optimize business performance to drive more overall growth. The ironSource platform also empowers telecom operators to create a richer device experience, incorporating relevant app and service recommendations to engage users throughout the lifecycle of the device. By providing a comprehensive business platform for the core constituents of the App Economy, ironSource allows customers to focus on what they do best, creating great apps and user experiences, while enabling their business expansion in the App Economy. For more information please visit www.is.com.

    Forward-Looking Statements

    Certain statements in this press release may constitute "forward-looking" statements and information, within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 that relate to, without limitation, ironSource's current expectations and projections relating to its financial condition, including the guidance for 2022 and our plans to expand to apps beyond games and to launch new solution, competitive position, future results of operations, plans, objectives, and views of future events. In some cases, these forward-looking statements can be identified by words or phrases such as "may," "might," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "seek," "believe," "estimate," "predict," "potential," "continue," "contemplate," "possible" or similar words. These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, without limitation, the following: (i) volatility in the price of the ironSource's securities due to a variety of factors, including changes in the competitive industry in which ironSource operates, variations in performance across competitors, changes in laws and regulations affecting ironSource's business and changes in its capital structure; (ii) ironSource's ability to implement its business plans, forecasts, and other expectations, and to identify and realize additional opportunities; (iii) ironSource's markets are rapidly evolving and may decline or experience limited growth; (iv) ironSource's reliance on operating system providers and app stores to support its platform; (v) ironSource's ability to compete effectively in the markets in which it operates; (vi) ironSource's quarterly results of operations may fluctuate for a variety of reasons; (vii) failure to maintain and enhance the ironSource brand; (viii) ironSource's dependence on its ability to retain and expand its existing customer relationships and attract new customers; (ix) ironSource's reliance on its customers that contribute more than $100,000 of annual revenue; (x) ironSource's ability to successfully and efficiently manage its current and potential future growth and successfully introduce new solutions; (xi) ironSource's dependence upon the continued growth of the app economy and the increased usage of smartphones, tablets and other connected devices; (xii) ironSource's dependence upon the success of the gaming and mobile app ecosystem and the risks generally associated with the gaming industry; (xiii) ironSource's, and ironSource's competitors', ability to detect or prevent fraud on its platforms; (xiv) failure to prevent security breaches or unauthorized access to ironSource's or its third-party service providers' data; (xv) the global scope of ironSource's operations, which are subject to laws and regulations worldwide, many of which are unsettled and still developing; (xvi) the rapidly changing and increasingly stringent laws, contractual obligations and industry standards relating to privacy, data protection, data security and the protection of children; (xvii) the effects of health epidemics, including the ongoing COVID-19 pandemic; and (xviii) other risk factors set forth in the section titled "Risk Factors" in ironSource's Prospectus filed with the Securities and Exchange Commission ("SEC") on October 5, 2021, and other documents filed with or furnished to the SEC.

    ironSource cautions you against placing undue reliance on forward-looking statements, which reflect current beliefs and are based on information currently available as of the date a forward-looking statement is made. Forward-looking statements set forth herein speak only as of the date of this communication. Except as required by law, ironSource does not undertake any obligation to revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs. In the event that any forward-looking statement is updated, no inference should be made that ironSource will make additional updates with respect to that statement, related matters, or any other forward-looking statements. Any corrections or revisions and other important assumptions and factors that could cause actual results to differ materially from forward-looking statements, including discussions of significant risk factors, may appear, in ironSource's public filings with the SEC, which are or will be (as appropriate) accessible at www.sec.gov, and which you are advised to consult.

    Market, ranking and industry data used throughout this communication, including statements regarding market size and technology adoption rates, is based on the good faith estimates of ironSource's management, which in turn are based upon ironSource's management's review of internal surveys, independent industry surveys and publications, including reports by Altman Solon, App Annie, AppsFlyer, Apptopia, eMarketer, Newzoo, Omdia and Sensor Tower and other third party research and publicly available information. These data involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. While ironSource is not aware of any misstatements regarding the industry data presented herein, its estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed above.

    IRONSOURCE LTD.

    CONDENSED CONSOLIDATED BALANCE SHEETS

    (U.S. dollars in thousands, except for number of shares and par value)

    (Unaudited)

     

     

     

    December 31,

     

     

     

    2021

     

     

    2020

     

    Assets

     

     

     

     

     

     

     

     

    Current assets:

     

     

     

     

     

     

     

     

    Cash and cash equivalents

     

    $

    778,261

     

     

    $

    200,672

     

    Short-term deposits

     

     

    —

     

     

     

    17,627

     

    Accounts receivable, net of allowances of $437 and $724 as of December 31, 2021 and 2020, respectively

     

     

    232,049

     

     

     

    151,503

     

    Other current assets

     

     

    42,382

     

     

     

    15,711

     

    Total current assets

     

     

    1,052,692

     

     

     

    385,513

     

    Long-term restricted cash

     

     

    3,495

     

     

     

    2,415

     

    Deferred tax assets

     

     

    2,012

     

     

     

    161

     

    Operating lease right-of-use asset

     

     

    34,116

     

     

     

    36,780

     

    Property, equipment and software, net

     

     

    25,131

     

     

     

    23,077

     

    Investment in equity securities

     

     

    20,000

     

     

     

    —

     

    Goodwill

     

     

    240,299

     

     

     

    79,156

     

    Intangible assets, net

     

     

    54,221

     

     

     

    8,084

     

    Other non-current assets

     

     

    18,857

     

     

     

    650

     

    Total assets

     

    $

    1,450,823

     

     

    $

    535,836

     

    IRONSOURCE LTD.

    CONDENSED CONSOLIDATED BALANCE SHEETS

    (U.S. dollars in thousands, except for number of shares and par value)

    (Unaudited)

     

     

     

    December 31,

     

     

     

    2021

     

     

    2020

     

    Liabilities and shareholders' equity

     

     

     

     

     

     

     

     

    Current liabilities:

     

     

     

     

     

     

     

     

    Accounts payable

     

    $

    247,362

     

     

    $

    155,476

     

    Current maturities of long-term loan

     

     

    —

     

     

     

    9,725

     

    Operating lease liabilities

     

     

    7,525

     

     

     

    7,429

     

    Other current liabilities

     

     

    53,949

     

     

     

    34,034

     

    Total current liabilities

     

     

    308,836

     

     

     

    206,664

     

    Long-term loan, net of current maturities

     

     

    —

     

     

     

    74,684

     

    Deferred tax liabilities

     

     

    6,514

     

     

     

    2,521

     

    Long-term operating lease liabilities

     

     

    30,076

     

     

     

    32,241

     

    Other non-current liabilities

     

     

    2,829

     

     

     

    280

     

    Total liabilities

     

     

    348,255

     

     

     

    316,390

     

    Commitments and contingencies

     

     

     

     

     

     

     

     

    Shareholders' equity:

     

     

     

     

     

     

     

     

    Class A and Class B ordinary share, no par value; 11,500,000,000 (Class A 10,000,000,000 and Class B 1,500,000,000) shares authorized; 1,018,468,804 (Class A 652,938,412 and Class B 365,530,392) and 640,266,044 (Class A 320,133,022 and Class B 320,133,022) issued and outstanding at December 31, 2021 and 2020, respectively (*)

     

     

    —

     

     

     

    —

     

    2019 ordinary shares, NIS 0.01 par value, 25,006,298 authorized, issued and outstanding at December 31, 2020

     

     

    —

     

     

     

    72

     

    Treasury shares, at cost, 6,745,955 Class A ordinary shares held at December 31, 2021

     

     

    (67,460

    )

     

     

    —

     

    Additional paid-in capital (*)

     

     

    1,042,589

     

     

     

    152,251

     

    Accumulated other comprehensive income

     

     

    495

     

     

     

    —

     

    Retained earnings

     

     

    126,944

     

     

     

    67,123

     

    Total shareholders' equity

     

     

    1,102,568

     

     

     

    219,446

     

    Total liabilities and shareholders' equity

     

    $

    1,450,823

     

     

    $

    535,836

     

    (*)

    Per share amounts have been adjusted, on a retroactive basis, for all periods presented, to reflect both the distribution of Class B ordinary shares and the Stock Split, together representing a ratio of 9.98 of each share.

    IRONSOURCE LTD.

    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

    (U.S. dollars in thousands, except share and per share amounts)

    (Unaudited)

     

     

     

    Three Months Ended

    December 31,

     

     

    Year Ended December 31,

     

     

     

    2021

     

     

    2020

     

     

    2021

     

     

    2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Revenue

     

    $

    158,271

     

     

    $

    108,354

     

     

    $

    553,466

     

     

    $

    331,519

     

    Cost of revenue

     

     

    24,562

     

     

     

    17,306

     

     

     

    89,223

     

     

     

    57,825

     

    Gross profit

     

     

    133,709

     

     

     

    91,048

     

     

     

    464,243

     

     

     

    273,694

     

    Operating expenses:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Research and development

     

     

    22,887

     

     

     

    17,149

     

     

     

    90,531

     

     

     

    51,600

     

    Sales and marketing

     

     

    56,804

     

     

     

    42,046

     

     

     

    208,707

     

     

     

    119,262

     

    General and administrative

     

     

    26,193

     

     

     

    8,910

     

     

     

    82,638

     

     

     

    28,746

     

    Total operating expenses

     

     

    105,884

     

     

     

    68,105

     

     

     

    381,876

     

     

     

    199,608

     

    Income from operations

     

     

    27,825

     

     

     

    22,943

     

     

     

    82,367

     

     

     

    74,086

     

    Financial expenses, net

     

     

    (57

    )

     

     

    1,771

     

     

     

    2,004

     

     

     

    4,381

     

    Income from continuing operations before income taxes

     

     

    27,882

     

     

     

    21,172

     

     

     

    80,363

     

     

     

    69,705

     

    Income taxes

     

     

    7,077

     

     

     

    3,852

     

     

     

    20,542

     

     

     

    10,896

     

    Income from continuing operations, net of income taxes

     

     

    20,805

     

     

     

    17,320

     

     

     

    59,821

     

     

     

    58,809

     

    Income from discontinued operations, net of income taxes

     

     

    —

     

     

     

    4,701

     

     

     

    —

     

     

     

    36,480

     

    Net income

     

    $

    20,805

     

     

    $

    22,021

     

     

    $

    59,821

     

     

    $

    95,289

     

    Basic net income per ordinary share: (*)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Continuing operations

     

     

    0.02

     

     

     

    0.02

     

     

     

    0.07

     

     

     

    0.07

     

    Discontinued operations

     

     

    —

     

     

     

    0.01

     

     

     

    —

     

     

     

    0.04

     

    Basic net income per ordinary share

     

    $

    0.02

     

     

    $

    0.03

     

     

    $

    0.07

     

     

    $

    0.11

     

    Weighted-average ordinary shares outstanding – basic

     

     

    1,014,509,223

     

     

     

    639,223,211

     

     

     

    832,144,353

     

     

     

    636,450,643

     

    Diluted net income per ordinary share: (*)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Continuing operations

     

     

    0.02

     

     

     

    0.02

     

     

     

    0.06

     

     

     

    0.06

     

    Discontinued operations

     

     

    —

     

     

     

    0.01

     

     

     

    —

     

     

     

    0.04

     

    Diluted net income per ordinary share

     

    $

    0.02

     

     

    $

    0.03

     

     

    $

    0.06

     

     

    $

    0.10

     

    Weighted-average ordinary shares outstanding – diluted

     

     

    1,094,974,000

     

     

     

    689,922,172

     

     

     

    911,059,088

     

     

     

    681,900,332

     

    (*)

    Per share amounts have been adjusted, on a retroactive basis, for all periods presented, to reflect both the distribution of Class B ordinary shares and the Stock Split, together representing a ratio of 9.98 of each share.

    IRONSOURCE LTD.

    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    (U.S. dollars in thousands)

    (Unaudited)

     

     

     

    Three Months Ended

    December 31,

     

     

    Year Ended December 31,

     

     

     

    2021

     

     

    2020

     

     

    2021

     

     

    2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Cash flows from operating Activities

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Net income from continuing operations

     

    $

    20,805

     

     

    $

    17,320

     

     

    $

    59,821

     

     

    $

    58,809

     

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

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Depreciation and amortization

     

     

    6,690

     

     

     

    4,628

     

     

     

    24,118

     

     

     

    16,858

     

    Share-based compensation expenses

     

     

    20,714

     

     

     

    5,005

     

     

     

    78,515

     

     

     

    12,596

     

    Non-cash lease expense

     

     

    1,134

     

     

     

    2,471

     

     

     

    595

     

     

     

    2,791

     

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

     

     

    (1,812

    )

     

     

    (1,407

    )

     

     

    (2,627

    )

     

     

    (1,395

    )

    Loss (gain) on disposal of property and equipment

     

     

    1

     

     

     

    —

     

     

     

    (16

    )

     

     

    —

     

    Interest accrued and other financial expenses

     

     

    —

     

     

     

    110

     

     

     

    628

     

     

     

    271

     

    Deferred income taxes, net

     

     

    1,178

     

     

     

    665

     

     

     

    644

     

     

     

    (633

    )

    Changes in operating assets and liabilities, net of effects of businesses acquired:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Accounts receivable

     

     

    (41,568

    )

     

     

    (25,435

    )

     

     

    (82,584

    )

     

     

    (39,816

    )

    Other current assets

     

     

    (10,261

    )

     

     

    (6,426

    )

     

     

    (27,721

    )

     

     

    (5,771

    )

    Other non-current assets

     

     

    (11,388

    )

     

     

    (1,746

    )

     

     

    (21,442

    )

     

     

    (3,913

    )

    Accounts payable

     

     

    33,932

     

     

     

    23,450

     

     

     

    97,701

     

     

     

    40,706

     

    Other current liabilities

     

     

    8,886

     

     

     

    6,690

     

     

     

    14,553

     

     

     

    11,118

     

    Other non-current liabilities

     

     

    1,274

     

     

     

    4

     

     

     

    1,705

     

     

     

    35

     

    Net cash provided by continuing operating activities

     

     

    29,585

     

     

     

    25,329

     

     

     

    143,890

     

     

     

    91,656

     

    Net cash provided by (used in) discontinued operating activities

     

     

    —

     

     

     

    6,188

     

     

     

    (5,168

    )

     

     

    52,771

     

    Net cash provided by operating activities

     

     

    29,585

     

     

     

    31,517

     

     

     

    138,722

     

     

     

    144,427

     

    Cash flows from investing activities

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Purchase of property and equipment

     

     

    (391

    )

     

     

    (94

    )

     

     

    (1,419

    )

     

     

    (1,049

    )

    Capitalized software development costs

     

     

    (2,662

    )

     

     

    (2,968

    )

     

     

    (10,821

    )

     

     

    (12,024

    )

    Purchase of intangible assets

     

     

    —

     

     

     

    —

     

     

     

    (1,950

    )

     

     

    —

     

    Proceeds from sale of property and equipment

     

     

    10

     

     

     

    —

     

     

     

    31

     

     

     

    —

     

    Acquisitions, net of cash acquired

     

     

    (38,209

    )

     

     

    —

     

     

     

    (127,549

    )

     

     

    —

     

    Purchase of equity investment

     

     

    —

     

     

     

    —

     

     

     

    (20,000

    )

     

     

    —

     

    Investments in short-term deposits

     

     

    —

     

     

     

    (17,590

    )

     

     

    —

     

     

     

    (60,180

    )

    Maturities of short-term deposits

     

     

    —

     

     

     

    37,590

     

     

     

    17,590

     

     

     

    50,690

     

    Net cash provided by (used in) continuing investing activities

     

     

    (41,252

    )

     

     

    16,938

     

     

     

    (144,118

    )

     

     

    (22,563

    )

    Net cash provided by (used in) discontinued investing activities

     

     

    —

     

     

     

    (928

    )

     

     

    —

     

     

     

    (5,082

    )

    Net cash provided by (used in) investing activities

     

     

    (41,252

    )

     

     

    16,010

     

     

     

    (144,118

    )

     

     

    (27,645

    )

    Cash flows from financing activities

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Repayment of long-term loan

     

     

    —

     

     

     

    (2,500

    )

     

     

    (85,000

    )

     

     

    (7,500

    )

    Proceeds from Recapitalization transaction, net

     

     

    —

     

     

     

    —

     

     

     

    663,813

     

     

     

    —

     

    Exercise of options and restricted share units

     

     

    738

     

     

     

    827

     

     

     

    2,625

     

     

     

    1,731

     

    Other

     

     

    —

     

     

     

    (540

    )

     

     

    —

     

     

     

    (540

    )

    Net cash provided by (used in) continuing financing activities

     

     

    738

     

     

     

    (2,213

    )

     

     

    581,438

     

     

     

    (6,309

    )

    Net cash provided by (used in) discontinued financing activities

     

     

    —

     

     

     

    —

     

     

     

    —

     

     

     

    —

     

    Net cash provided by (used in) financing activities

     

     

    738

     

     

     

    (2,213

    )

     

     

    581,438

     

     

     

    (6,309

    )

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

     

     

    1,812

     

     

     

    1,407

     

     

     

    2,627

     

     

     

    1,395

     

    Net change in cash and cash equivalents and restricted cash

     

     

    (10,929

    )

     

     

    45,314

     

     

     

    576,042

     

     

     

    110,473

     

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

     

     

    790,873

     

     

     

    156,366

     

     

     

    203,087

     

     

     

    91,219

     

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

     

    $

    781,756

     

     

    $

    203,087

     

     

    $

    781,756

     

     

    $

    203,087

     

    Annex A

    IRONSOURCE LTD.

    Non-GAAP Financial Metrics

    (U.S. dollars in thousands, except per share amounts)

    (Unaudited)

    The following tables show the Company's non-GAAP financial metrics reconciled to the comparable GAAP financial metrics included in this release.

    Reconciliation of GAAP to Non-GAAP net income from continuing operations, net of income taxes and net income per share:

     

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP Income from continuing operations, net of income taxes

     

    $

    20,805

     

     

    $

    17,320

     

     

    $

    59,821

     

     

    $

    58,809

     

    Add:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Share-based compensation expense

     

     

    20,714

     

     

     

    5,005

     

     

     

    78,515

     

     

     

    12,596

     

    Depreciation and amortization

     

     

    6,690

     

     

     

    4,628

     

     

     

    24,118

     

     

     

    16,858

     

    Acquisition-related costs

     

     

    2,033

     

     

     

    —

     

     

     

    4,487

     

     

     

    —

     

    Offering Costs

     

     

    —

     

     

     

    —

     

     

     

    4,214

     

     

     

    —

     

    Non-GAAP net income

     

    $

    50,242

     

     

    $

    26,953

     

     

    $

    171,155

     

     

    $

    88,263

     

    Weighted-average ordinary shares outstanding—basic*

     

     

    1,014,509,223

     

     

     

    639,223,211

     

     

     

    832,144,353

     

     

     

    636,450,643

     

    Basic Non-GAAP net income per ordinary share*

     

    $

    0.05

     

     

    $

    0.03

     

     

    $

    0.18

     

     

    $

    0.10

     

    Weighted-average ordinary shares outstanding—diluted*

     

     

    1,094,974,000

     

     

     

    689,922,172

     

     

     

    911,059,088

     

     

     

    681,900,332

     

    Diluted Non-GAAP net income per ordinary share*

     

    $

    0.05

     

     

    $

    0.03

     

     

    $

    0.17

     

     

    $

    0.09

     

    *

    Per share amounts have been adjusted, on a retroactive basis, for all periods presented, to reflect both the distribution of Class B ordinary shares and the Stock Split, together representing a ratio of 9.98 of each share.

    (Unaudited)

    Adjusted EBITDA and Adjusted EBITDA margin and a reconciliation of GAAP income from continuing operations, net of income taxes to Adjusted EBITDA:

     

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP Income from continuing operations, net of income taxes

     

    $

    20,805

     

     

    $

    17,320

     

     

    $

    59,821

     

     

    $

    58,809

     

    Add:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Financial expenses, net

     

     

    (57

    )

     

     

    1,771

     

     

     

    2,004

     

     

     

    4,381

     

    Income taxes

     

     

    7,077

     

     

     

    3,852

     

     

     

    20,542

     

     

     

    10,896

     

    Share-based compensation expense

     

     

    20,714

     

     

     

    5,005

     

     

     

    78,515

     

     

     

    12,596

     

    Depreciation and amortization

     

     

    6,690

     

     

     

    4,628

     

     

     

    24,118

     

     

     

    16,858

     

    Acquisition-related costs

     

     

    2,033

     

     

     

    —

     

     

     

    4,487

     

     

     

    —

     

    Offering Costs

     

     

    —

     

     

     

    —

     

     

     

    4,214

     

     

     

    —

     

    Adjusted EBITDA

     

    $

    57,262

     

     

    $

    32,576

     

     

    $

    193,701

     

     

    $

    103,540

     

    Revenue

     

    $

    158,271

     

     

    $

    108,354

     

     

    $

    553,466

     

     

    $

    331,519

     

    Income from continuing operations, net of income taxes margin

     

     

    13

    %

     

     

    16

    %

     

     

    11

    %

     

     

    18

    %

    Adjusted EBITDA margin

     

     

    36

    %

     

     

    30

    %

     

     

    35

    %

     

     

    31

    %

    Reconciliation of GAAP to Non-GAAP gross profit and gross profit margin:

     

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP gross profit

     

    $

    133,709

     

     

    $

    91,048

     

     

    $

    464,243

     

     

    $

    273,694

     

    Add:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Share-based compensation expense

     

     

    304

     

     

     

    191

     

     

     

    1,217

     

     

     

    316

     

    Depreciation and amortization

     

     

    5,855

     

     

     

    4,033

     

     

     

    20,949

     

     

     

    14,487

     

    Non-GAAP gross profit

     

    $

    139,868

     

     

    $

    95,272

     

     

    $

    486,409

     

     

    $

    288,497

     

    GAAP gross margin

     

     

    84

    %

     

     

    84

    %

     

     

    84

    %

     

     

    83

    %

    Non-GAAP gross margin

     

     

    88

    %

     

     

    88

    %

     

     

    88

    %

     

     

    87

    %

    (Unaudited)

    Reconciliation of GAAP to Non-GAAP operating expenses:

    Research and development

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP research and development expense

     

    $

    22,887

     

     

    $

    17,149

     

     

    $

    90,531

     

     

    $

    51,600

     

    Less:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Share-based compensation expense

     

     

    6,864

     

     

     

    1,529

     

     

     

    24,419

     

     

     

    3,881

     

    Acquisition-related costs

     

     

    234

     

     

     

    —

     

     

     

    465

     

     

     

    —

     

    Non-GAAP research and development expense

     

    $

    15,789

     

     

    $

    15,620

     

     

    $

    65,647

     

     

    $

    47,719

     

    GAAP research and development expense as a percentage of revenue

     

     

    14

    %

     

     

    16

    %

     

     

    16

    %

     

     

    16

    %

    Non-GAAP research and development expense as a percentage of revenue

     

     

    10

    %

     

     

    14

    %

     

     

    12

    %

     

     

    14

    %

    Sales and marketing

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP sales and marketing expense

     

    $

    56,804

     

     

    $

    42,046

     

     

    $

    208,707

     

     

    $

    119,262

     

    Less:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Share-based compensation expense

     

     

    4,162

     

     

     

    2,177

     

     

     

    16,807

     

     

     

    4,692

     

    Depreciation and amortization

     

     

    446

     

     

     

    231

     

     

     

    1,678

     

     

     

    925

     

    Acquisition-related costs

     

     

    697

     

     

     

    —

     

     

     

    1,073

     

     

     

    —

     

    Non-GAAP sales and marketing expense

     

    $

    51,499

     

     

    $

    39,638

     

     

    $

    189,149

     

     

    $

    113,645

     

    GAAP sales and marketing expense as a percentage of revenue

     

     

    36

    %

     

     

    39

    %

     

     

    38

    %

     

     

    36

    %

    Non-GAAP sales and marketing expense as a percentage of revenue

     

     

    33

    %

     

     

    37

    %

     

     

    34

    %

     

     

    34

    %

    General and administrative

     

    Q4 2021

     

     

    Q4 2020

     

     

    FY 2021

     

     

    FY 2020

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    GAAP general and administrative expense

     

    $

    26,193

     

     

    $

    8,910

     

     

    $

    82,638

     

     

    $

    28,746

     

    Less:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Share-based compensation expense

     

     

    9,384

     

     

     

    1,108

     

     

     

    36,072

     

     

     

    3,707

     

    Depreciation and amortization

     

     

    389

     

     

     

    364

     

     

     

    1,491

     

     

     

    1,446

     

    Acquisition-related costs

     

     

    1,102

     

     

     

    —

     

     

     

    2,949

     

     

     

    —

     

    Offering Costs

     

     

    —

     

     

     

    —

     

     

     

    4,214

     

     

     

    —

     

    Non-GAAP general and administrative expense

     

    $

    15,318

     

     

    $

    7,438

     

     

    $

    37,912

     

     

    $

    23,593

     

    GAAP general and administrative expense as a percentage of revenue

     

     

    17

    %

     

     

    8

    %

     

     

    15

    %

     

     

    9

    %

    Non-GAAP general and administrative expense as a percentage of revenue

     

     

    10

    %

     

     

    7

    %

     

     

    7

    %

     

     

    7

    %

     

    View source version on businesswire.com: https://www.businesswire.com/news/home/20220216005152/en/

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    • KeyBanc Capital Markets initiated coverage on ironSource with a new price target

      KeyBanc Capital Markets initiated coverage of ironSource with a rating of Overweight and set a new price target of $3.50

      6/30/22 7:47:31 AM ET
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    SEC Filings

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    • SEC Form 15-12G filed by ironSource Ltd.

      15-12G - ironSource Ltd (0001837430) (Filer)

      11/17/22 4:06:02 PM ET
      $IS
    • SEC Form EFFECT filed by ironSource Ltd.

      EFFECT - ironSource Ltd (0001837430) (Filer)

      11/10/22 12:15:05 AM ET
      $IS
    • SEC Form 6-K filed by ironSource Ltd.

      6-K - ironSource Ltd (0001837430) (Filer)

      11/7/22 9:24:00 AM ET
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    • SolarEdge Appoints Shuki Nir as Chief Executive Officer

      SolarEdge Technologies, Inc. ("SolarEdge" or the "Company") (NASDAQ:SEDG), a global leader in smart energy technology, today announced the appointment of Mr. Shuki Nir as the Company's new Chief Executive Officer (CEO), effective immediately. Mr. Nir, who has served as SolarEdge's CMO since June 2024, will succeed Mr. Ronen Faier, who has served as the Company's Interim CEO since August 2024. Mr. Faier will stay on with the Company as an advisor during a transition period to ensure a seamless leadership transition. Mr. Nir is also replacing Mr. Zvi Lando as a member of the Board of Directors. This press release features multimedia. View the full release here: https://www.businesswire.com/n

      12/5/24 7:00:00 AM ET
      $KRNT
      $SEDG
      $IS
      Industrial Machinery/Components
      Industrials
      Semiconductors
      Technology
    • ironSource and Sensor Tower Partner to Unlock Growth for App Marketers

      Industry-first partnership combines the ad and app intelligence of Sensor Tower with the keyword campaign management and optimization of ironSource Luna to help app developers scale their campaigns ironSource (NYSE:IS), a leading business platform for the App Economy, today announced its partnership with Sensor Tower, the leading source of enterprise-grade market intelligence for the digital ecosystem. By combining the keyword intelligence of Sensor Tower from across the market, with the campaign management and optimization capabilities of ironSource Luna, the partnership will create one place for app marketers to scale Apple Search Ads campaigns to drive incremental growth. ironSource Lun

      11/3/22 7:15:00 AM ET
      $IS
    • ironSource Expands Samsung Partnership, Launching on Samsung Mobile Devices in MENA

      Aura solution suite supports Samsung in increasing customer loyalty and engagement by leveraging relevant content and apps for mobile users in MENA; Partnership creates a unique, and incremental distribution channel for app marketers looking to diversify their UA strategy and grow their userbase across the region ironSource (NYSE:IS), a leading business platform for the App Economy, today announced the expansion of its partnership with Samsung, as it launches on mobile devices in the Middle East and North Africa. Aura, ironSource's solution suite for telecom operators and OEMs, is already integrated on Samsung mobile devices in more than 30 markets, including Europe, Russia, South East Asi

      11/3/22 7:00:00 AM ET
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    Large Ownership Changes

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    • SEC Form SC 13G/A filed by ironSource Ltd. (Amendment)

      SC 13G/A - ironSource Ltd (0001837430) (Subject)

      2/14/23 5:24:13 PM ET
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    • SEC Form SC 13G/A filed by ironSource Ltd. (Amendment)

      SC 13G/A - ironSource Ltd (0001837430) (Subject)

      2/14/23 5:23:05 PM ET
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    • SEC Form SC 13G/A filed by ironSource Ltd. (Amendment)

      SC 13G/A - ironSource Ltd (0001837430) (Subject)

      2/14/23 4:42:57 PM ET
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    Financials

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    • ironSource Announces Second Quarter 2022 Results

      Revenue of $183 million, 35% year-over-year growth Adjusted EBITDA of $56 million, 31% Adjusted EBITDA margin Dollar-based net expansion rate of 142% ironSource (NYSE:IS) ("ironSource" or the "Company"), a leading business platform for the App Economy, today announced financial results for the three months ended June 30, 2022. "We are very pleased with our Q2 results, as ironSource is proud to be among the few technology companies that deliver high-growth coupled with consistent profitability. We've had a strong quarter, with revenue of $183 million, growing 35% year-over-year, and a dollar-based net expansion rate of 142%, as customers continue to grow using our platform," said Tomer B

      8/10/22 7:00:00 AM ET
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      Computer Software: Prepackaged Software
      Technology
    • ironSource to Report Second Quarter Fiscal Year 2022 Financial Results on August 10, 2022

      ironSource (NYSE:IS) ("ironSource" or the "Company"), a leading business platform for the App Economy, today announced it will release its financial results for the second quarter ended June 30, 2022, before the market opens on August 10, 2022. As announced on July 13, 2022, ironSource entered into an agreement to merge with Unity Software Inc. ("Unity") in an all-stock transaction that values ironSource at approximately $4.4 billion (the "Merger"). The proposed Merger has been approved by the boards of directors of both companies, is expected to close during the fourth quarter of 2022 and is subject to customary closing conditions, including regulatory approvals and shareholder approval o

      7/21/22 4:30:00 PM ET
      $IS
    • Unity Announces Merger Agreement with ironSource

      – Transformative combination forms the industry's first end-to-end platform to power creators' success as they build, run, manage, grow, and monetize live games and real-time, 3D content – Highly accretive merger is expected to deliver a run rate of $1 billion in Adjusted EBITDA by the end of 2024, and $300 million in annual EBITDA synergies by year three. All-stock transaction values ironSource at approximately $4.4 billion, representing a 74% premium to the 30-day average exchange ratio. Unity Board authorizes a share buyback program of up to $2.5 billion effective upon closing of the transaction. Silver Lake and Sequoia, the two largest Unity shareholders, have committed to inves

      7/13/22 6:44:00 AM ET
      $IS
      $U
      Computer Software: Prepackaged Software
      Technology

    $IS
    Leadership Updates

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    • SolarEdge Appoints Shuki Nir as Chief Executive Officer

      SolarEdge Technologies, Inc. ("SolarEdge" or the "Company") (NASDAQ:SEDG), a global leader in smart energy technology, today announced the appointment of Mr. Shuki Nir as the Company's new Chief Executive Officer (CEO), effective immediately. Mr. Nir, who has served as SolarEdge's CMO since June 2024, will succeed Mr. Ronen Faier, who has served as the Company's Interim CEO since August 2024. Mr. Faier will stay on with the Company as an advisor during a transition period to ensure a seamless leadership transition. Mr. Nir is also replacing Mr. Zvi Lando as a member of the Board of Directors. This press release features multimedia. View the full release here: https://www.businesswire.com/n

      12/5/24 7:00:00 AM ET
      $KRNT
      $SEDG
      $IS
      Industrial Machinery/Components
      Industrials
      Semiconductors
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