Welcome!

News Feed Item

YuMe Reports Fourth Quarter and Full Year 2016 Financial Results

YuMe, Inc. (NYSE: YUME), a proven partner for video advertising leadership and innovation, today announced its financial results for the fourth quarter and full year ended December 31, 2016.

“We ended the year strong and executed well against our Q4 financial and strategic goals. Programmatic revenue for fourth quarter and full year beat our guidance. We delivered our healthiest gross margins ever and generated our highest adjusted EBITDA result in four years, all indicating the underlying health of the business,” said Paul Porrini, Chief Executive Officer. “The fourth quarter marked the best quarter for our programmatic business, bringing our full year revenue from programmatic to $21.2 million which gives us continued confidence in our strategy. Further we achieved this growth while significantly expanding profitability. We are very encouraged by these results and believe they set the stage for continued expansion and profitability in 2017.”

Financial highlights for fourth quarter 2016:

  • Revenue of $45.6 million, compared to $53.8 million in the fourth quarter of 2015 (Q4 2015);
    • Revenue from top 20 advertising customers of $23.8 million;
    • Mobile, tablet and connected television impressions accounted for 54% of revenue;
    • Programmatic revenue1 was $13.3 million.
  • Gross margin of 52.7%, compared to 46.4% in Q4 2015;
  • Net income of $2.8 million, or $0.08 per diluted share, compared to net income of $1.6 million, or $0.05 per diluted share, in Q4 2015;
  • Adjusted EBITDA2 of $8.8 million, compared to adjusted EBITDA of $5.6 million in Q4 2015.

Financial highlights for full year 2016:

  • Revenue of $160.4 million, compared to $173.3 million in 2015;
    • Revenue from top 20 advertising customers of $69.3 million;
    • Mobile, tablet and connected television impressions accounted for 47% of revenue;
    • Programmatic revenue1 was $21.2 million.
  • Gross margin of 50.0%, compared to 45.2% in 2015;
  • Net loss of $7.7 million, or $0.22 per diluted share, compared to a net loss of $16.7 million, or $0.49 per diluted share, in 2015;
  • Adjusted EBITDA2 of $10.9 million, compared to adjusted EBITDA loss of $1.6 million in 2015;
  • $65.7 million in cash, cash equivalents and marketable securities and no debt as of December 31, 2016.

Share Repurchase Program Update

For the three month period ended December 31, 2016, the Company acquired approximately 0.6 million shares of its common stock for $2.1 million, at an average price per share of $3.64. From January 1, 2017 through February 15, 2017, the Company acquired approximately 0.2 million shares of its common stock for $0.8 million, at an average price per share of $3.61. Since announcing its $10 million share repurchase program on February 18, 2016 through February 15, 2017, the Company has acquired approximately 2.2 million shares of its common stock for $7.9 million, at an average price per share of $3.63. The Company has $2.1 million left under its share repurchase authorization.

Asset Impairment Charge

In the fourth quarter 2016, the Company impaired its YFP 5.0 supply-side platform and recorded a non-cash asset charge of approximately $922,000. The impairment charge is shown separately on the Company’s Condensed Consolidated Statements of Operations and is also excluded from the Company’s adjusted EBITDA and adjusted net loss calculation as it is both non-cash and one-time in nature. The Company will provide additional disclosure on this topic in its forthcoming Form 10-K.

Strategic Alternatives Update

YuMe is continuing its engagement with Deutsche Bank as its financial advisor to assist in evaluating the Company’s value-enhancing initiatives. The Company will provide an update to this process when it determines that further disclosures are appropriate.

Business Outlook

For the first quarter 2017, the Company expects adjusted EBITDA in the range of $1 million to $3 million. Adjusted EBITDA guidance includes the impact of our restructuring plan announced during the fourth quarter of 2016 and other cost savings initiatives.

Conference Call and Webcast Information

Senior management will host a conference call at 5:00 p.m. ET today to discuss the Company’s results. Investors may access the live call by dialing (866) 393-4306 or (734) 385-2616. A replay will be available through Thursday, February 23 at (855) 859-2056 or (404) 537-3406. (Conference ID: 56328829). A live and archived Webcast of the call will be available at http://investors.yume.com.

1 Programmatic buying is the automated purchase of digital advertising inventory through a combination of machine-based transactions, data and algorithms.

2 Adjusted EBITDA is a non-GAAP financial measure that we calculate as net income (loss), adjusted to exclude income taxes, interest expense, depreciation and amortization, stock-based compensation and non-recurring proxy contest, asset impairment and restructuring expenses. We believe that adjusted EBITDA provides useful information to investors in understanding and evaluating our operating results in the same manner as management and the board of directors. This non-GAAP information is not necessarily comparable to non-GAAP information of other companies. Non-GAAP information should not be viewed as a substitute for, or superior to, net income prepared in accordance with GAAP as a measure of our profitability or liquidity. Users of this financial information should consider the types of events and transactions for which adjustments have been made.

About YuMe

YuMe, Inc. (NYSE: YUME) is a leading provider of global audience technologies, curating relationships between brand advertisers and consumers of premium video content across a growing range of connected devices. Combining data-driven technologies with deep insight into audience behavior, YuMe offers brand advertisers end-to-end marketing software that establishes greater brand resonance with engaged consumers. It is the evolution of brand advertising for an ever-expanding video ecosystem. YuMe is headquartered in Redwood City, California, with worldwide offices. For more information, visit YuMe.com/pr, follow @YuMeVideo and like YuMe on Facebook.

YuMe is a trademark of YuMe. All other brands, products or service names are or may be trademarks or service marks of their respective owners.

Forward-Looking Statements

This press release, conference call and webcast of the same date contain forward-looking statements regarding future events and our future financial performance. All statements other than statements of historical fact are statements that could be forward-looking statements, including, but not limited to our Business Outlook, statements about our growth strategy, the impact of restructuring and cost saving initiatives, potential merger and acquisition activity, the impact of management changes, our operating results, financial goals for 2017, market trends, and quotations from management. These forward-looking statements are subject to risks and uncertainties, assumptions and other factors that could cause actual results and the timing of events to differ materially from future results that are expressed or implied in our forward-looking statements. Factors that could cause or contribute to such differences include adaptation to new, changing and competitive technologies and trends in a dynamic market, changes to our management, competitive trends in a dynamic market, our history of net losses and limited operating history, which make it difficult to evaluate our prospects, our fluctuating quarterly results of operations, risks associated with margin shifts in the industry and our dependence on a limited number of customers in a highly competitive industry. These and other risk factors are discussed under “Risk Factors” in YuMe’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 that has been filed with the U.S. Securities and Exchange Commission (the “SEC”), and in our future filings and reports with the SEC. The forward-looking statements in this press release are based on information available to YuMe as of the date hereof, and YuMe assumes no obligation to update any forward-looking statements.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), we report in this press release and on our webcast adjusted EBITDA, which is a non-GAAP financial measure. We calculate adjusted EBITDA as net income (loss), excluding income taxes, interest, expense, depreciation and amortization, stock-based compensation and non-recurring proxy contest, asset impairment and restructuring expenses. We believe that adjusted EBITDA provides useful information to investors in understanding our operating results in the same manner as management and the board of directors. This non-GAAP information is not necessarily comparable to non-GAAP information presented by other companies. Non-GAAP financial information should not be viewed as a substitute for, or superior to, financial information prepared in accordance with GAAP. Users of this non-GAAP financial information should consider the types of events and transactions for which adjustments have been made.

We have included adjusted EBITDA in this release and on our webcast because it is a key measure we use to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, we believe that adjusted EBITDA can provide a useful measure for period-to-period comparisons of our operating results because it excludes some expenses that may mask underlying trends.

In the table following the financial statements attached to this press release, the non-GAAP financial measures used in this press release are reconciled to the most directly comparable GAAP financial measures. With respect to adjusted EBITDA expectations provided under “Business Outlook” above, quantitative reconciliation to the most directly comparable GAAP financial measure is not reasonably available. We expect that the variability of the above charges may have a significant and unpredictable impact on our future GAAP financial results.

 
YuMe, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

(Unaudited)

 
 

As of
December 31,
2016

 

As of
December 31,
2015

Assets (1)
Current assets:
Cash and cash equivalents $ 34,700 $ 17,859
Marketable securities 25,751 30,600
Restricted cash 292
Accounts receivable, net 51,171 67,131
Prepaid expenses and other current assets   3,591     3,978  
Total current assets 115,213 119,860
Marketable securities, long-term 5,241 11,724
Property, equipment and software, net 11,726 12,110
Goodwill 3,902 3,902
Intangible assets, net 659
Restricted cash, non-current 710 403
Deposits and other assets   587     416  
Total assets $ 137,379   $ 149,074  
 
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 10,775 $ 12,080
Accrued digital media property owner costs 16,385 17,155
Accrued liabilities 12,192 16,767
Deferred revenue 132 214
Capital lease   8      
Total current liabilities   39,492     46,216  
Capital lease, non-current 13
Other long-term liabilities 631 77
Deferred tax liability       178  
Total liabilities   40,136     46,471  
 
Stockholders’ equity:
Common stock 36 34
Treasury stock (7,105 )
Additional paid-in-capital 159,550 150,001
Accumulated deficit (54,888 ) (47,167 )
Accumulated other comprehensive loss   (350 )   (265 )
Total stockholders’ equity   97,243     102,603  
Total liabilities and stockholders’ equity $ 137,379   $ 149,074  
(1) The condensed consolidated balance sheet as of December 31, 2015 was derived from audited financial statements.
 

YuMe, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

 
  Three Months Ended Year Ended
December 31, December 31,
2016 2015   2016       2015  
Revenue $ 45,550 $ 53,836 $ 160,411 $ 173,254
Cost of revenue (1)   21,548   28,856   80,190     95,028  
Gross profit   24,002   24,980   80,221     78,226  
Operating expenses:
Sales and marketing (1) 11,532 14,489 51,676 59,912
Research and development (1) 2,506 2,833 10,968 10,937
General and administrative (1) 4,559 5,812 22,513 23,584
Asset impairment 922 922
Restructuring   1,577     1,577      
Total operating expenses   21,096   23,134   87,656     94,433  
Income (loss) from operations   2,906   1,846   (7,435 )   (16,207 )
Interest and other expense, net
Interest expense (1 ) (2 ) (7 ) (8 )
Other expense, net   (153 )   (94 )   (299 )   (230 )
Total interest and other expense, net   (154 )   (96 )   (306 )   (238 )
Income (loss) before income taxes 2,752 1,750 (7,741 ) (16,445 )
Income tax (expense) benefit   75   (130 )   20     (300 )
Net income (loss) $ 2,827 $ 1,620 $ (7,721 ) $ (16,745 )
 
Net income (loss) per share:
Basic $ 0.08 $ 0.05 $ (0.22 ) $ (0.49 )
Diluted $ 0.08 $ 0.05 $ (0.22 ) $ (0.49 )
Weighted-average shares used to compute net income (loss) per share:
Basic   34,195   34,435   34,441     33,829  
Diluted   34,815   34,976   34,441     33,829  
 

(1) Stock-based compensation included above (in thousands, unaudited):

 
Three Months Ended Year Ended
December 31, December 31,
2016 2015   2016  

 

 

2015

 
Cost of revenue $ 34 $ 67 $ 178

 

$

312

Sales and marketing 459 748 2,612

 

3,403

Research and development 276 292 1,200

 

1,111

General and administrative   1,017   1,038   4,434  

 

 

4,053

 
Total stock-based compensation $ 1,786 $ 2,145 $ 8,424  

 

$

8,879

 
 
YuMe, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION
(In thousands)

(Unaudited)

 
  Three Months Ended   Year Ended
December 31, December 31,
2016   2015 2016   2015
Net Income (loss) $ 2,827 $ 1,620 $ (7,721 ) $ (16,745 )
Adjustments:
Interest expense 1 2 7 8
Income tax expense (benefit) (75 ) 130 (20 ) 300
Depreciation and amortization expense 1,786 1,712 6,876 6,006
Stock-based compensation expense 1,786 2,145 8,424 8,879
Proxy contest expenses 815
Asset impairment 922 922
Restructuring   1,577       1,577      
Total Adjustments   5,997     3,989   18,601     15,193  
Adjusted EBITDA $ 8,824   $ 5,609 $ 10,880   $ (1,552 )

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 21st International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @ThingsExpo Silicon Valley Call for Papers is now open.
Regardless of what business you’re in, it’s increasingly a software-driven business. Consumers’ rising expectations for connected digital and physical experiences are driving what some are calling the "Customer Experience Challenge.” In his session at @DevOpsSummit at 20th Cloud Expo, Marco Morales, Director of Global Solutions at CollabNet, will discuss how organizations are increasingly adopting a discipline of Value Stream Mapping to ensure that the software they are producing is poised to ...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
When NSA's digital armory was leaked, it was only a matter of time before the code was morphed into a ransom seeking worm. This talk, designed for C-level attendees, demonstrates a Live Hack of a virtual environment to show the ease in which any average user can leverage these tools and infiltrate their network environment. This session will include an overview of the Shadbrokers NSA leak situation.
SYS-CON Events announced today that delaPlex will exhibit at SYS-CON's @ThingsExpo, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. delaPlex pioneered Software Development as a Service (SDaaS), which provides scalable resources to build, test, and deploy software. It’s a fast and more reliable way to develop a new product or expand your in-house team.
Interested in leveling up on your Cloud Foundry skills? Join IBM for Cloud Foundry Days on June 7 at Cloud Expo New York at the Javits Center in New York City. Cloud Foundry Days is a free half day educational conference and networking event. Come find out why Cloud Foundry is the industry's fastest-growing and most adopted cloud application platform.
In his opening keynote at 20th Cloud Expo, Michael Maximilien, Research Scientist, Architect, and Engineer at IBM, will motivate why realizing the full potential of the cloud and social data requires artificial intelligence. By mixing Cloud Foundry and the rich set of Watson services, IBM's Bluemix is the best cloud operating system for enterprises today, providing rapid development and deployment of applications that can take advantage of the rich catalog of Watson services to help drive insigh...
Automation is enabling enterprises to design, deploy, and manage more complex, hybrid cloud environments. Yet the people who manage these environments must be trained in and understanding these environments better than ever before. A new era of analytics and cognitive computing is adding intelligence, but also more complexity, to these cloud environments. How smart is your cloud? How smart should it be? In this power panel at 20th Cloud Expo, moderated by Conference Chair Roger Strukhoff, pane...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
As enterprise cloud becomes the norm, businesses and government programs must address compounded regulatory compliance related to data privacy and information protection. The most recent, Controlled Unclassified Information and the EU’s GDPR have board level implications and companies still struggle with demonstrating due diligence. Developers and DevOps leaders, as part of the pre-planning process and the associated supply chain, could benefit from updating their code libraries and design by in...
The 21st International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Machine Learning and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding busin...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
SYS-CON Events announced today that DivvyCloud will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. DivvyCloud software enables organizations to achieve their cloud computing goals by simplifying and automating security, compliance and cost optimization of public and private cloud infrastructure. Using DivvyCloud, customers can leverage programmatic Bots to identify and remediate common cloud problems in rea...
Most DevOps journeys involve several phases of maturity. Research shows that the inflection point where organizations begin to see maximum value is when they implement tight integration deploying their code to their infrastructure. Success at this level is the last barrier to at-will deployment. Storage, for instance, is more capable than where we read and write data. In his session at @DevOpsSummit at 20th Cloud Expo, Josh Atwell, a Developer Advocate for NetApp, will discuss the role and value...
SYS-CON Events announced today that Tintri, Inc, a leading provider of enterprise cloud infrastructure, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Tintri offers an enterprise cloud platform built with public cloud-like web services and RESTful APIs. Organizations use Tintri all-flash storage with scale-out and automation as a foundation for their own clouds – to build agile development environments...