– Q3 Revenue of $22.0 million, in line with our
previous preliminary estimates –
– Q3 Software and Managed Services Revenue of
$14.7 and $7.3 million –
– ARR of $63.3 million from 3,291 Total
Software Products & Services Customers, including $48.3 million
or 76% from subscription-based customers demonstrating diversified
& stable revenue streams –
– Completed restructuring through Q3 resulting
in forecasted annualized savings of over 15% in operating expense
from FY 2023 accelerating expected profitability into fiscal 2025
–
– Completed divestiture of media agency in
October 2024 for total consideration of up to $104 million,
including $59.1 million of cash at closing and up to $18 million in
earnout subject to the media agency’s revenue performance in
calendar year 2025. Net proceeds used to paydown $30.5 million in
term debt –
– Announced fiscal 2025 business outlook with
up to 30% year over year forecasted revenue growth and over 45%
forecasted improvement in Non-GAAP Net Loss as compared to fiscal
2024 guidance led by over $100 million in sales pipeline at Q3 2024
–
Veritone, Inc. (NASDAQ:VERI), a leader in designing
human-centered AI solutions, today reported results for the third
quarter ended September 30, 2024.
“The divestiture of Veritone One marks a defining moment in our
company's evolution, positioning us as a pure-play enterprise AI
company at a pivotal time in the technology landscape," said Ryan
Steelberg, Chief Executive Officer of Veritone. “With over 3,000
existing customers across Commercial and Public Sectors, we're now
poised to capitalize on the unprecedented growth in the AI
solutions market. As we look toward 2025, we're energized by our
streamlined operational focus and enhanced ability to invest in
innovation that will truly differentiate Veritone in the enterprise
AI marketplace.”
Third Quarter 2024 Financial
Highlights
- Revenue of $22.0 million, a decrease of 21% compared to Q3
2023.
- Software Products and Services revenues of $14.7 million, a
decrease of 28% compared to $20.4 million in Q3 2023 driven by
expected declines in consumption- based revenue customers,
including Amazon and declines in one-time non-recurring software
revenue.
- Managed Services revenue of $7.3 million as compared to $7.6
million in Q3 2023.
- Total Software Products & Services Customers of 3,291, down
7% year over year, as compared to September 30, 2023, largely
driven by Commercial Enterprise, which began sunsetting legacy
Career Builder customers following the June 2023 acquisition of
Broadbean, offset by an increase across Public Sector from growth
in public safety customers.
- Total New Bookings of $16.5 million, up 17% sequentially from
Q2 2024 and 6% year over year, as compared to Q3 2023.
- Annual Recurring Revenue (“ARR”) (as defined below) of $63.3
million, down from $89.3 million in Q3 2023 driven by declines in
consumption-based revenue, including Amazon, offset by a slight
increase from recurring subscription-based SaaS revenue
customers.
- Net loss from Continuing Operations of $22.5 million, as
compared to a loss of $26.7 million in Q3 2023 driven by lower
overall operating expenses resulting from our past cost reduction
plans and offset by decline in revenue.
- Non-GAAP gross profit of $15.7 million, a decrease of 25% or
$5.3 million as compared to Q3 2023 primarily due to the decline in
revenue.
- Non-GAAP gross margins of 71.2% as compared to 74.9% in Q3
2023.
- Net Loss of $21.7 million, as compared to $24.5 million in Q3
2023.
- Non-GAAP Net Loss of $7.1 million, which was relatively flat as
compared to Q3 2023.
Divestiture of Veritone One,
LLC
Through October 17, 2024 (the “Divestiture Closing Date”), we
operated Veritone One, LLC (“Veritone One”), a full-service
advertising agency, to provide differentiated Managed Services to
our customers. On October 17, 2024, we sold all of the issued and
outstanding equity of Veritone One to an affiliate of Insignia
Capital Group L.P. (such transaction, the “Divestiture”). Veritone
One’s services include media planning and strategy, advertisement
buying and placement, campaign messaging, clearance verification
and attribution, and custom analytics, specializing in
host-endorsed and influencer advertising across primarily radio,
podcasting, streaming audio, social media and other digital media
channels. We determined that the Divestiture represents a strategic
shift that will have a material effect on our operations and
financial results. Therefore, the historical financial results of
Veritone One are reflected in this earnings release as discontinued
operations and, as such, have been excluded from continuing
operations for all periods presented on a retrospective basis,
unless otherwise stated.
About Our Sales Pipeline
Our sales pipeline represents revenue we expect to receive based
on the total fees payable during the full contract term for new
contracts outstanding at the end of the quarter and contracts that
we believe have a high probability of closing in the next three to
twelve months. We include in our sales pipeline fees payable during
any cancellable portion and an estimate of license fees that may
fluctuate over the term and we do not include any variable fees
under the contract (e.g., fees for cognitive processing, storage,
professional services and other variable services) and any fees
payable after contract renewals or extensions that are at the
discretion of our customer. Many of our contracts require us to
provide services over more than one year and may include
professional fees required to enable our technology in certain
environments we do not host or have direct control over. In some
cases, our customers may have the ability to terminate our
agreements on short notice and our pipeline does not consider the
potential impact of any early termination. No assurance can be
given that we will ultimately realize our full sales pipeline.
Three Months Ended September
30,
Nine Months Ended September
30,
Unaudited
Percent
Percent
(in $000s)
2024
2023
Change
2024
2023
Change
Revenue
$
21,993
$
27,968
(21
)%
$
70,204
$
72,883
(4
)%
Loss from operations
$
(22,492
)
$
(25,183
)
11
%
$
(67,167
)
$
(79,773
)
16
%
Net loss from continuing operations
$
(22,511
)
$
(26,732
)
16
%
$
(72,072
)
$
(76,012
)
5
%
Net loss
$
(21,746
)
$
(24,541
)
11
%
$
(69,175
)
$
(70,800
)
2
%
Non-GAAP gross profit*
$
15,668
$
20,942
(25
)%
$
50,590
$
51,502
(2
)%
Non-GAAP net loss from continuing
operations*
$
(11,097
)
$
(10,411
)
(7
)%
$
(31,139
)
$
(36,833
)
15
%
Non-GAAP net loss*
$
(7,113
)
$
(7,943
)
10
%
$
(21,579
)
$
(30,523
)
29
%
Three Months Ended September
30,
Nine Months Ended September
30,
Unaudited
Percent
Percent
(in $000s, except customers)
2024
2023(1)
Change
2024
2023(1)
Change
Software Products & Services
Software Revenue*
$
14,694
$
20,361
(28
)%
$
45,549
$
63,643
(28
)%
Total Software Products & Services
Customers(2)
3,291
3,536
(7
)%
3,291
3,536
(7
)%
Annual Recurring Revenue(3)*
$
63,280
$
89,299
(29
)%
$
63,280
$
89,299
(29
)%
Total New Bookings(4)
$
16,471
$
15,501
6
%
$
16,471
$
15,501
6
%
Gross Revenue Retention(5)
>90%
>90%
>90%
>90%
(1)All of the supplemental financial information for the nine
months ended September 30, 2023 reflects the historical information
of Veritone combined with the historical information of Broadbean
(as defined below) as if Veritone had acquired Broadbean on January
1, 2022. Veritone completed its acquisition of (i) all of the
issued and outstanding share capital of (a) Broadbean Technology
Pty Ltd ACN 116 011 959 / ABN 79 116 011 959, a limited company
incorporated under the laws of Australia, (b) Broadbean Technology
Limited, a limited company incorporated under the laws of England
and Wales, (c) Broadbean, Inc., a Delaware corporation and (d)
CareerBuilder France S.A.R.L., a limited liability company
organized (société à responsabilité limitée) under the laws of
France, and (ii) certain assets and liabilities related thereto
(the foregoing clauses (i) and (ii) together, “Broadbean”) on June
13, 2023. (2)“Total Software Products & Services Customers”
includes Software Products & Services customers as of the end
of each respective quarter set forth above with net revenues in
excess of $10 and also excludes any customers categorized by us as
trial or pilot status. In prior periods, we provided “Ending
Software Customers,” which represented Software Products &
Services customers as of the end of each fiscal quarter with
trailing twelve-month revenues in excess of $2,400 for both
Veritone, Inc. and PandoLogic Ltd. and/or deemed by Veritone to be
under an active contract for the applicable periods. Total Software
Products & Services Customers is not comparable to Ending
Software Customers. Total Software Products & Services
Customers includes customers based on revenues in the last month of
the quarter rather than on a trailing twelve month basis and
excludes any customers that are on trial or pilot status with us
rather than including customers with active contracts. Management
uses Total Software Products & Services Customers and we
believe Total Software Products & Services Customers are useful
to investors because it more accurately reflects our total
customers for our Software Products & Services inclusive of
Broadbean. (3) “Annual Recurring Revenue” is calculated as Annual
Recurring Revenue (SaaS), which is an annualized calculation of the
monthly recurring revenue in the last month of the calculated
quarter for all active Software Products & Services customers,
combined with Annual Recurring Revenue (Consumption), which is the
trailing twelve month calculation of all non-recurring and/or
consumption-based revenue for all active Software Products &
Services customers. In prior periods, we provided “Average Annual
Revenue,” which was calculated as the aggregate of trailing
twelve-month Software Products & Services revenue divided by
the average number of customers over the same period for both
Veritone, Inc. and PandoLogic Ltd. Annual Recurring Revenue is not
comparable to Average Annual Revenue. Annual Recurring Revenue
reflects the historical information of Veritone combined with the
historical information of Broadbean as if Veritone had acquired
Broadbean on January 1, 2022 where indicated, is not averaged among
active customers and uses a calculation of recurring revenue as
described above instead of annual revenue. Veritone completed its
acquisition of Broadbean on June 13, 2023. Management uses “Annual
Recurring Revenue” and we believe Annual Recurring Revenue is
useful to investors because Broadbean significantly increases our
mix of subscription-based SaaS revenues as compared to
non-recurring and/or consumption-based revenues. (4)“Total New
Bookings” represents the total fees payable during the full
contract term for new contracts received in the quarter (including
fees payable during any cancellable portion and an estimate of
license fees that may fluctuate over the term), excluding any
variable fees under the contract (e.g., fees for cognitive
processing, storage, professional services and other variable
services). (5) “Gross Revenue Retention” represents our
dollar-based gross retention rate as of the period end by starting
with the revenue from Software Products & Services Customers as
of the 3 months in the prior year quarter to such period, or Prior
Year Quarter Revenue. We then deduct from the Prior Year Quarter
Revenue any revenue from Software Products & Services Customers
who are no longer customers as of the current period end, or
Current Period Ending Software Customer Revenue. We then divide the
total Current Period Ending Software Customer Revenue by the total
Prior Year Quarter Revenue to arrive at our dollar-based gross
retention rate, which is the percentage of revenue from all
Software Products & Services Customers from our Software
Products & Services as of the year prior that is not lost to
customer churn. All numbers used to determine Gross Revenue
Retention are calculated reflecting the acquisition of Broadbean as
if the acquisition had been completed as of January 1, 2022.
* See tables below for reconciliation of non-GAAP financial
measures to directly comparable GAAP measures and for the
definitions used for Software Products & Services Supplemental
Financial Information.
Recent Business
Highlights
Public Sector
- Closed 13 new public safety and government customers, including
the Department of Justice - Office of Public Affairs.
- Signed agreements with two of the largest counties in Southern
California and a state-wide law enforcement agency.
- Expanded market reach with new strategic partnerships,
including Nuix and international conglomerate, Getac.
Commercial Enterprise
- Signed multi-year agreement with iHeartMedia, for expansion
across their 850+ stations, enabling seamless and analytical
process and review of unstructured audio data in near-real
time.
- Secured AWS Media and Entertainment Services Competency in
Media Supply Chain and Data Science & Analytics, recognizing
our specialized expertise, technical proficiency and proven success
in helping customers transform their media and entertainment
operations with innovative cloud-based AI solutions.
- Signed agreement with E.W. Scripps, enabling their Court TV
media property to leverage Veritone’s AI platform to enhance the
storage, management and distribution of its extensive content
library.
- Signed multi-year agreement with ESPN to manage their content
library and extended existing agreement with ESPN to utilize
Veritone’s AI platform to track the impact on native advertising
placements and promotions, both spoken and visual, across multiple
ESPN-owned channels.
- Signed a multi-year extension with the National Football
League, providing searchable access to valuable sporting content to
enrich its fan experience.
- Signed a multi-year agreement with the NCAA with a contract
value of over $40 million.
- Signed multi-year enterprise deal with Big 4 accounting firm to
build-out AI capabilities across its hiring platform.
- Signed several new enterprise programmatic advertising and job
distribution software deals, including global brands such as Magna
International, Shell Energy Australia, Marriott International,
Ferrovial, Teleperformance, and Mitsubishi Chemical.
- Completed the divestiture of our media agency, Veritone One, in
October 2024, as described above.
Financial Results for Three Months
Ended September 30, 2024
Delivered third quarter revenue of $22.0 million, a decrease of
$6.0 million or 21% from $28.0 million in the third quarter of
2023. Software Products & Services revenue of $14.7 million
decreased by $5.7 million or 28% year over year driven by expected
declines in Commercial Enterprise principally from consumption
based customers, including Amazon and one-time software revenue in
Q3 2023 that did not recur in Q3 2024. Managed Services revenue of
$7.3 million was relatively flat when compared to $7.6 million in
Q3 2023.
Net loss from continuing operations was $22.5 million improving
$4.42 million as compared to $26.7 million in the third quarter of
2023, driven by the year over year improvement in loss from
operations, coupled with a $1.6 million higher tax benefit from
income in Q3 2024 as compared to Q3 2023. Non-GAAP net loss of $7.1
million decreased by 10% when compared to Non-GAAP net loss of $7.9
million in the third quarter of 2023, largely driven by the decline
in Non-GAAP gross profit, which was partially offset by cost
reductions enacted during the nine months ended September 30,
2024.
As of September 30, 2024, Total Software Product & Services
Customers of 3,291 was down 7% year over year relative to Total
Software Product & Services Customers as of September 30, 2023,
principally due to declines in Commercial Enterprise from planned
migration of legacy CareerBuilder customers off the Broadbean
software platform, offset by increases in Public Sector. Total New
Bookings increased by 6% to $16.5 million versus the comparable
period a year ago largely driven by an increase in
subscription-based customer bookings, offset by a reduction in
revenue from consumption-based customers, including Amazon. Annual
Recurring Revenue of $63.3 million decreased 29% year over year
driven in large part by the declines in Commercial Enterprise
consumption spending from customers, offset by a slight increase
year over year increase in Annual Recurring Revenue from
subscription-based SaaS customers.
Business Outlook
Full Year 2024
- Revenue is expected to be in the range of $92.5 million to
$93.5 million, as compared to $100.0 million for the full year of
2023
- Non-GAAP net loss is expected to be in the range of $(37.5)
million to $(36.5) million, compared to non-GAAP net loss of
$(45.5) million for the full year of 2023.
Full Year 2025
- Revenue is expected to be in the range of $107.0 million to
$122.0 million, as compared to the midpoint of $93.0 million for
fiscal 2024.
- Non-GAAP net loss is expected to be in the range of $(25.0)
million to $(15.0) million, compared to non-GAAP net loss midpoint
of $(37.0) million for fiscal 2024.
These updated financial guidance ranges supersede any previously
disclosed financial guidance and investors should not rely on any
previously disclosed financial guidance.
Conference Call
Veritone will hold a conference call to deliver management’s
prepared remarks on November 12, 2024, at 8:30 a.m. Eastern Time
(5:30 a.m. Pacific Time) to discuss its third quarter 2024 results,
provide an update on the business and conduct a question-and-answer
session. To participate, please join the audio webcast or dial-in
and ask to be connected to the Veritone earnings conference call.
To avoid a delay, if dialing in, please pre-register or join the
live audio webcast.
- Pre-Registration*
- Live Audio Webcast
- Domestic Call Number: (844) 750-4897
- International Call Number: (412) 317-5293
A replay of the conference call can be accessed one hour after
the end of the conference call through November 19, 2024. The full
webcast replay will be available through November 12, 2025. To
access the earnings webcast replay please visit the Veritone
Investor Relations website.
- Domestic Replay Number: (877) 344-7529
- International Replay Number: (412) 317-0088
- Replay Access Code: 7123119
* Please note that pre-registered participants will receive
their dial-in number and unique PIN upon registration.
About the Presentation of Supplemental
Non-GAAP Financial Information and Key Performance
Indicators
In this news release, the Company has supplemented its financial
measures prepared in accordance with U.S. generally accepted
accounting principles (GAAP) with certain non-GAAP financial
measures, including Non-GAAP gross profit, Non-GAAP gross margin,
Non-GAAP net income (loss) and Non-GAAP net income (loss) per
share. The Company also provides certain key performance indicators
(KPIs), including Total Software Products & Services Customers,
Annual Recurring Revenue, Annual Recurring Revenue (SaaS), Annual
Recurring Revenue (Consumption), Total New Bookings and Gross
Revenue Retention. The Company has posted additional supplemental
financial information on its website at investors.veritone.com
concurrently with this press release.
Non-GAAP gross profit is defined as revenue less cost of
revenue. Non-GAAP gross margin is defined as Non-GAAP gross profit
divided by revenue. Non-GAAP net income (loss) and non-GAAP net
income (loss) per share, respectively, is the Company’s net income
(loss) and net income (loss) per share, adjusted to exclude
provision for income taxes, depreciation expense, amortization
expense, stock-based compensation expense, changes in fair value of
warrant liability, changes in fair value of contingent
consideration, interest income, interest expense, foreign currency
gains and losses, acquisition and due diligence costs, gain on sale
of energy group, contribution of business held for sale, variable
consultant performance bonus expense, and severance and executive
transition costs. The items excluded from these non-GAAP financial
measures, as well as a breakdown of GAAP net income (loss),
non-GAAP net income (loss) and these excluded items, are detailed
in the reconciliations included following the financial statements
attached to this news release. In addition, following the financial
statements attached to this news release, the Company has provided
additional supplemental non-GAAP measures of operating expenses,
loss from operations, other income (expense), net, and loss before
income taxes, excluding the items excluded from non-GAAP net loss
as noted above, and reconciling such non-GAAP measures to the most
directly comparable GAAP measures.
The Company has provided these non-GAAP financial measures and
KPIs because management believes such information to be important
supplemental measures of performance that are commonly used by
securities analysts, investors and other interested parties in the
evaluation of companies in its industry. Management also uses this
information internally for forecasting and budgeting. The non-GAAP
financial measures should not be considered as an alternative to
revenue, net income (loss), operating income (loss) or any other
financial measures so calculated and presented, nor as an
alternative to cash flow from operating activities as a measure of
liquidity. Other companies (including the Company’s competitors)
may define these non-GAAP financial measures differently. The
non-GAAP financial measures may not be indicative of the historical
operating results of Veritone or predictive of potential future
results. Investors should not consider these non-GAAP financial
measures in isolation or as a substitute for analysis of the
Company’s results as reported in accordance with GAAP.
In addition, the Company defines the following capitalized terms
in this news release as follows:
Core Operations consists of the Company’s aiWARE operating
platform of software, SaaS and related services; content licensing
and representation services; and their supporting operations,
including direct costs of sales as well as operating expenses for
sales, marketing and product development and certain general and
administrative costs dedicated to these operations.
Corporate principally consists of general and administrative
functions such as executive, finance, legal, people operations,
fixed overhead expenses (including facilities and information
technology expenses), other income (expenses) and taxes, and other
expenses that support the entire Company, including public company
driven costs.
Software Products & Services consists of revenues generated
from commercial enterprise and government and regulated industries
customers using our aiWARE platform and Hiring Solutions, any
related support and maintenance services, and any related
professional services associated with the deployment and/or
implementation of such solutions.
Managed Services consist of revenues generated from commercial
enterprise customers using our content licensing and representation
services and supporting operations.
About Veritone
Veritone (NASDAQ: VERI) builds human-centered enterprise AI
solutions. Serving customers in the media, entertainment, public
sector and talent acquisition industries, Veritone’s software and
services empower individuals at the world’s largest and most
recognizable brands to run more efficiently, accelerate decision
making and increase profitability. Veritone’s leading enterprise AI
platform, aiWARE™, orchestrates an ever-growing ecosystem of
machine learning models, transforming data sources into actionable
intelligence. By blending human expertise with AI technology,
Veritone advances human potential to help organizations solve
problems and achieve more than ever before, enhancing lives
everywhere.
To learn more, visit Veritone.com.
Safe Harbor Statement
This news release contains forward-looking statements, including
without limitation, statements regarding our prospects for the
business after the sale of Veritone One and our future ability to
invest in innovation, our ability to capitalize on growth in the AI
solutions market, our ability to realize annualized cost-savings
including from our recent cost restructurings, and our expected
total revenue and non-GAAP net loss for Q4 2024 and for full year
2025. In addition, words such as “may,” “will,” “expect,”
“believe,” “anticipate,” “intend,” “plan,” “outlook,” “should,”
“could,” “estimate,” “confident” or “continue” or the plural,
negative or other variations thereof or comparable terminology are
intended to identify forward-looking statements, and any statements
that refer to expectations, projections or other characterizations
of future events or circumstances are forward-looking statements.
These forward-looking statements speak only as of the date hereof,
and are based on management’s current assumptions, expectations,
beliefs and information. As such, our actual results could differ
materially and adversely from those expressed in any
forward-looking statement as a result of various factors. Important
factors that could cause such differences include, among other
things, our operations and financial results after the sale of
Veritone One; our ability to continue as a going concern; our
ability to expand our aiWARE SaaS business; declines or limited
growth in the market for AI-based software applications and
concerns over the use of AI that may hinder the adoption of AI
technologies; our requirements for additional capital and liquidity
to support our operations, our business growth, service our debt
obligations and refinance maturing debt obligations, and the
availability of such capital on acceptable terms, if at all; our
reliance upon a limited number of key customers for a significant
portion of our revenue; declines in customers’ usage of our
products and other offerings; our ability to realize the intended
benefits of our acquisitions, divestitures, and other planned or
ongoing cost-saving measures, including our ability to successfully
integrate our recent acquisition of Broadbean; our identification
of existing material weaknesses in our internal control over
financial reporting; fluctuations in our results over time; the
impact of seasonality on our business; our ability to manage our
growth, including through acquisitions and expansion into
international markets; our ability to enhance our existing products
and introduce new products that achieve market acceptance and keep
pace with technological developments; actions by our competitors,
partners and others that may block us from using third party
technologies in our aiWARE platform, offering it for free to the
public or making it cost prohibitive to continue to incorporate
such technologies into our platform; interruptions, performance
problems or security issues with our technology and infrastructure,
or that of our third party service providers; the impact of the
continuing economic disruption caused by macroeconomic and
geopolitical factors, including the Russia-Ukraine conflict, the
war in Israel, financial instability, high interest rates,
inflationary pressures and the responses by central banking
authorities to control inflation, monetary supply shifts and the
threat of recession in the United States and around the world on
our business operations and those of our existing and potential
customers; and future business decisions, all of which are
difficult or impossible to predict accurately and many of which are
beyond our control. Certain of these judgments and risks are
discussed in more detail in our most recently-filed Annual Report
on Form 10-K, and our Quarterly Reports on Form 10-Q and other
periodic reports filed from time to time with the Securities and
Exchange Commission. In light of the significant uncertainties
inherent in the forward-looking information included herein, the
inclusion of such information should not be regarded as a
representation by us or any other person that our objectives or
plans will be achieved. The forward-looking statements contained
herein reflect our beliefs, estimates and predictions as of the
date hereof, and we undertake no obligation to revise or update the
forward-looking statements contained herein to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events for any reason, except as required by law.
VERITONE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED)
(in thousands)
As of
September 30, 2024
December 31, 2023
ASSETS
Cash and cash equivalents
$
11,422
$
46,609
Accounts receivable, net
33,859
33,895
Prepaid expenses and other current
assets
6,162
7,864
Current assets of discontinued
operations
113,972
97,446
Total current assets
165,415
185,814
Property, equipment and improvements,
net
9,864
8,079
Intangible assets, net
65,488
83,423
Goodwill
53,110
53,529
Long-term restricted cash
936
867
Other assets
7,022
9,164
Non-current assets of discontinued
operations
34,590
37,982
Total assets
$
336,425
$
378,858
LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)
Accounts payable
$
9,356
$
16,620
Deferred revenue
12,836
12,813
Term Loan, current portion (1)
38,262
5,813
Accrued purchase consideration,
current
983
1,000
Accrued media payments
2,906
2,220
Client advances
17
17
Other accrued liabilities
26,387
26,493
Current liabilities of discontinued
operations
158,540
126,893
Total current liabilities
249,287
191,869
Convertible Notes, non-current
89,990
89,572
Term Loan, non-current (1)
12,906
45,012
Accrued purchase consideration,
non-current
750
633
Other non-current liabilities
8,653
13,625
Total liabilities
361,586
340,711
Total stockholders' equity (deficit)
(25,161
)
38,147
Total liabilities and stockholders' equity
(deficit)
$
336,425
$
378,858
(1) Due to the classification of held-for-sale at September 30,
2024, and the proximity of the October 17, 2024 Divestiture to the
September 30, 2024 balance sheet, the Company classified the $30.5
million of debt paid down through the Divestiture as Term Loan,
current portion on the September 30, 2024 balance sheet.
VERITONE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
AND COMPREHENSIVE INCOME
(LOSS)
(in thousands, except per
share and share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Revenue
$
21,993
$
27,968
$
70,204
$
72,883
Operating expenses:
Cost of revenue
6,325
7,026
19,614
21,381
Sales and marketing
10,186
10,997
31,230
32,895
Research and development
7,528
10,410
23,388
32,456
General and administrative
14,421
18,264
45,133
48,837
Amortization
6,025
6,454
18,006
17,087
Total operating expenses
44,485
53,151
137,371
152,656
Loss from operations
(22,492
)
(25,183
)
(67,167
)
(79,773
)
Other income (expense), net
(2,594
)
(2,552
)
(8,618
)
1,088
Loss before provision for income taxes
(25,086
)
(27,735
)
(75,785
)
(78,685
)
(Benefit from) provision for income
taxes
(2,575
)
(1,003
)
(3,713
)
(2,673
)
Net loss from continuing operations
(22,511
)
(26,732
)
(72,072
)
(76,012
)
Net income from discontinued
operations
765
2,191
2,897
5,212
Net loss
$
(21,746
)
$
(24,541
)
$
(69,175
)
$
(70,800
)
Net (loss) income per share:
Basic and diluted net loss from continuing
operations
$
(0.59
)
$
(0.72
)
$
(1.91
)
$
(2.06
)
Basic and diluted net income from
discontinued operations
$
0.02
$
0.06
$
0.08
$
0.14
Basic and diluted net loss
$
(0.57
)
$
(0.66
)
$
(1.83
)
$
(1.92
)
Weighted average shares outstanding:
Basic and diluted
38,086,765
36,991,650
37,752,562
36,810,878
Comprehensive loss:
Net loss
$
(21,746
)
$
(24,541
)
$
(69,175
)
$
(70,800
)
Foreign currency translation gain (loss),
net of income taxes
11
1,749
10
(14
)
Total comprehensive loss
$
(21,735
)
$
(22,792
)
$
(69,165
)
$
(70,814
)
VERITONE, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED)
(in thousands)
Nine Months Ended September
30,
2024
2023
Cash flows from operating
activities:
Net loss
$
(69,175
)
$
(70,800
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation and amortization
21,699
20,154
Provision for credit losses
673
168
Stock-based compensation expense
5,928
8,646
Gain on sale of energy group
—
(2,572
)
Change in fair value of contingent
consideration
—
1,468
Change in deferred taxes
(4,968
)
(2,858
)
Amortization of debt issuance costs and
debt discounts
4,636
649
Amortization of right-of-use assets
399
1,127
Imputed non-cash interest income
(263
)
(108
)
Changes in assets and liabilities:
Accounts receivable
2,959
14,052
Expenditures billable to clients
(17,550
)
(2,108
)
Prepaid expenses and other assets
407
1,224
Other assets
3,425
(1,300
)
Accounts payable
(8,346
)
2,405
Deferred revenue
23
(913
)
Accrued media payments
14,033
(17,718
)
Client advances
19,697
(1,567
)
Other accrued liabilities
2,130
4,714
Other liabilities
70
(2,774
)
Net cash used in operating activities
(24,223
)
(48,111
)
Cash flows from investing
activities:
Proceeds from sale of energy group
1,800
504
Capital expenditures
(5,134
)
(4,054
)
Acquisitions, net of cash acquired
—
(50,195
)
Net cash used in investing activities
(3,334
)
(53,745
)
Cash flows from financing
activities:
Payment of debt principal
(3,875
)
—
Payment of purchase consideration
—
(7,772
)
Taxes paid related to net share settlement
of equity awards
(653
)
(1,088
)
Proceeds from issuances of stock under
employee stock plans, net
433
1,063
Settlement of deferred consideration for
acquisitions
(1,800
)
(2,690
)
Net cash used in financing activities
(5,895
)
(10,487
)
Net decrease in cash and cash equivalents
and restricted cash
(33,452
)
(112,343
)
Cash and cash equivalents and restricted
cash, beginning of period
80,306
185,282
Cash and cash equivalents and restricted
cash, end of period
46,854
72,939
Less: Cash and cash equivalents and
restricted cash included in discontinued operations
34,496
58,001
Cash and cash equivalents and restricted
cash included in continuing operations
$
12,358
$
14,938
VERITONE, INC.
REVENUE DETAIL
(UNAUDITED)
(in thousands)
Three Months Ended September
30,
2024
2023
Commercial
Public
Commercial
Public
Enterprise
Sector
Total
Enterprise
Sector
Total
Total Software Products &
Services
$
13,098
$
1,596
$
14,694
$
18,885
$
1,476
$
20,361
Managed Services
Representation Services
2,730
—
2,730
2,828
—
2,828
Licensing
4,569
—
4,569
4,779
—
4,779
Total Managed Services
7,299
—
7,299
7,607
—
7,607
Total Revenue
$
20,397
$
1,596
$
21,993
$
26,492
$
1,476
$
27,968
Nine Months Ended September
30,
2024
2023
Commercial
Public
Commercial
Public
Enterprise
Sector
Total
Enterprise
Sector
Total
Total Software Products &
Services
$
41,310
$
4,236
$
45,546
$
44,109
$
4,472
$
48,581
Managed Services
Representation Services
9,763
—
9,763
8,465
—
8,465
Licensing
14,895
—
14,895
15,837
—
15,837
Total Managed Services
24,658
—
24,658
24,302
—
24,302
Total Revenue
$
65,968
$
4,236
$
70,204
$
68,411
$
4,472
$
72,883
VERITONE, INC.
RECONCILIATION OF NON-GAAP NET
INCOME (LOSS) TO GAAP NET LOSS (UNAUDITED)
(in thousands)
Three Months Ended September
30,
2024
2023
Core Operations(1)
Corporate(2)
Total
Core Operations(1)
Corporate(2)
Total
Net loss
$
(10,448
)
$
(11,298
)
$
(21,746
)
$
(10,689
)
$
(13,854
)
$
(24,543
)
Income from discontinued operations, net
of income tax
(765
)
—
(765
)
(2,191
)
—
(2,191
)
(Benefit from) provision for income
taxes
(2,575
)
—
(2,575
)
(3,189
)
2,186
(1,003
)
Depreciation and amortization
7,040
112
7,152
7,623
—
7,623
Stock-based compensation expense
1,002
1,097
2,099
1,367
586
1,953
Purchase consideration expense(3)
—
367
367
—
816
816
Interest expense, net
—
2,987
2,987
96
218
314
Foreign currency impact
—
(393
)
(393
)
2,318
(24
)
2,294
Acquisition and due diligence costs(4)
—
368
368
—
3,177
3,177
Variable consultant performance bonus
expense (6)
—
—
—
397
—
397
Severance and executive transition
costs
1,351
58
1,409
737
15
752
Non-GAAP net loss from continuing
operations
(4,395
)
(6,702
)
(11,097
)
(3,531
)
(6,880
)
(10,411
)
Non-GAAP net income from discontinued
operations
3,984
—
3,984
2,468
—
2,468
Non-GAAP net loss
$
(411
)
$
(6,702
)
$
(7,113
)
$
(1,063
)
$
(6,880
)
$
(7,943
)
Nine Months Ended September
30,
2024
2023
Core Operations(1)
Corporate(2)
Total
Core Operations(1)
Corporate(2)
Total
Net loss
$
(41,764
)
$
(27,411
)
$
(69,175
)
$
(38,464
)
$
(32,336
)
$
(70,800
)
Income from discontinued operations, net
of income tax
(2,897
)
—
(2,897
)
(5,212
)
—
(5,212
)
(Benefit from) provision for income
taxes
(3,713
)
—
(3,713
)
(4,460
)
1,787
(2,673
)
Depreciation and amortization
21,117
337
21,454
18,592
724
19,316
Stock-based compensation expense
2,586
3,105
5,691
5,267
2,936
8,203
Purchase consideration expense(3)
—
1,252
1,252
—
1,467
1,467
Interest expense, net
—
8,485
8,485
330
1,734
2,064
Foreign currency impact
—
(29
)
(29
)
(459
)
(67
)
(526
)
Gain on debt extinguishment
—
(8
)
(8
)
—
—
—
Acquisition and due diligence costs(4)
3,257
—
3,257
—
8,253
8,253
Loss (gain) on sale
—
172
172
—
(2,572
)
(2,572
)
Contribution of business held for
sale(5)
—
—
—
1,789
—
1,789
Variable consultant performance bonus
expense (6)
—
—
—
1,028
—
1,028
Severance and executive transition
costs
4,194
178
4,372
2,183
647
2,830
Non-GAAP net loss from continuing
operations
(17,220
)
(13,919
)
(31,139
)
(19,406
)
(17,427
)
(36,833
)
Non-GAAP net income from discontinued
operations
9,560
—
9,560
6,310
—
6,310
Non-GAAP net loss
$
(7,660
)
$
(13,919
)
$
(21,579
)
$
(13,096
)
$
(17,427
)
$
(30,523
)
(1) Core operations consists of our consolidated Software
Products & Services and Managed Services that include our
content licensing and representation services, and their supporting
operations, including direct costs of sales as well as operating
expenses for sales, marketing and product development and certain
general and administrative costs dedicated to these operations. (2)
Corporate consists of general and administrative functions such as
executive, finance, legal, people operations, fixed overhead
expenses (including facilities and information technology
expenses), other income (expenses) and taxes, and other expenses
that support the entire company, including public company driven
costs. (3) Purchase consideration expense includes consideration
related to acquisitions. (4) For the three and nine months ended
September 30, 2024, acquisition and due diligence costs are
comprised of professional fees related to our acquisitions and
divestitures. (5) Contribution of business held for sale relates to
the net loss for the periods presented for our Energy Group that we
divested during the second quarter of 2023. (6) Variable consultant
performance bonus expense represents the bonus payments paid to Mr.
Chad Steelberg as a result of his achievement of the performance
goals pursuant to his consulting agreement with us.
VERITONE, INC.
RECONCILIATION OF NON-GAAP NET INCOME FROM DISCONTINUED
OPERATIONS TO GAAP NET INCOME FROM DISCONTINUED OPERATIONS
(UNAUDITED) (in thousands)
(in thousands)
Three Months Ended September
30,
2024
2023
Core Operations
Corporate
Total
Core Operations
Corporate
Total
Net income from discontinued
operations
$
765
$
—
$
765
$
2,191
$
—
$
2,191
Provision for income taxes
26
—
26
26
—
26
Depreciation and amortization
87
—
87
235
—
235
Stock-based compensation expense
82
—
82
79
0
79
Interest expense, net
1,699
—
1,699
(96
)
—
(96
)
Acquisition and due diligence costs(1)
1,292
—
1,292
—
—
—
Severance and executive transition
costs
33
—
33
33
—
33
Non-GAAP net income from discontinued
operations
$
3,984
$
—
$
3,984
$
2,468
$
—
$
2,468
(in thousands)
Nine Months Ended September
30,
2024
2023
Core Operations
Corporate
Total
Core Operations
Corporate
Total
Net income from discontinued
operations
$
2,897
$
—
$
2,897
$
5,212
$
—
$
5,212
Provision for income taxes
76
—
76
51
—
51
Depreciation and amortization
245
—
245
837
—
837
Stock-based compensation expense
237
—
237
443
—
443
Interest expense, net
4,689
—
4,689
(321
)
—
(321
)
Acquisition and due diligence costs(1)
1,369
—
1,369
—
—
—
Severance and executive transition
costs
47
—
47
88
—
88
Non-GAAP net income from discontinued
operations
$
9,560
$
—
$
9,560
$
6,310
$
—
$
6,310
(1) For the three and nine months ended September 30, 2024,
acquisition and due diligence costs are comprised of professional
fees related to our acquisitions and divestitures.
VERITONE, INC.
RECONCILIATION OF EXPECTED
NON-GAAP NET LOSS RANGE
TO EXPECTED GAAP NET LOSS
RANGE (UNAUDITED)
(in millions)
Year Ended
December 31, 2024
December 31, 2025
Net Loss
($57.0) to ($51.4)
($78.0) to ($63.5)
Income from discontinued operations, net
of income taxes
($2.9)
$0.0
Provision for (benefit from) income
taxes
($4.5) to ($5.5)
$1.0 to ($1.0)
Interest expense, net
$24.0 to $23.0
$15.0 to $14.0
Depreciation and amortization
$28.9
$28.0
Stock-based compensation expense
$7.7 to $7.6
$7.5 to $6.7
Acquisition and due diligence costs
$5.0 to $4.0
$0.0
Purchase consideration expense(1)
$0.3
$0.5 to $0.3
Gain on sale
($44.0) to ($45.0)
$0.0
Severance and executive transition
costs
$5.0 to $4.5
$1.0 to $0.5
Non-GAAP net loss from continuing
operations
($37.5) to ($36.5)
($25.0) to ($15.0)
Non-GAAP net income from discontinued
operations
$9.6
$0.0
Non-GAAP net loss
($27.9) to ($26.9)
($25.0) to ($15.0)
Year Ended
December 31, 2024
December 31, 2025
Net income from discontinued
operations
$2.9
$0.0
Provision for (benefit from) income
taxes
$0.1
$0.0
Interest expense, net
$4.7
$0.0
Depreciation and amortization
$0.3
$0.0
Stock-based compensation expense
$0.2
$0.0
Acquisition and due diligence costs
$1.4
$0.0
Non-GAAP net income from discontinued
operations
$9.6
$0.0
(1) Purchase consideration expense includes consideration
related to acquisitions.
VERITONE, INC.
RECONCILIATION OF NON-GAAP TO
GAAP FINANCIAL INFORMATION (UNAUDITED)
(in thousands, except per
share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Revenue
$
21,993
$
27,968
$
70,204
$
72,883
Cost of revenue
6,325
7,026
19,614
21,381
Non-GAAP gross profit
15,668
20,942
50,590
51,502
GAAP cost of revenue
6,325
7,026
19,614
21,381
Stock-based compensation expense
—
7
1
(32
)
Non-GAAP cost of revenue
6,325
7,033
19,615
21,349
GAAP sales and marketing expenses
10,186
10,997
31,230
32,895
Depreciation
59
46
171
124
Stock-based compensation expense
(253
)
(189
)
(699
)
(824
)
Contribution of business held for sale
(2)
—
—
—
(484
)
Severance and executive transition
costs
(188
)
(201
)
(1,169
)
(690
)
Non-GAAP sales and marketing expenses
9,804
10,653
29,533
31,021
GAAP research and development expenses
7,528
10,410
23,388
32,456
Depreciation
(767
)
(334
)
(2,119
)
(854
)
Stock-based compensation expense
(439
)
(953
)
(1,066
)
(3,622
)
Contribution of business held for sale
(2)
—
—
—
(1,117
)
Severance and executive transition
costs
(926
)
(188
)
(2,384
)
(868
)
Non-GAAP research and development
expenses
5,396
8,935
17,819
25,995
GAAP general and administrative
expenses
14,421
18,264
45,133
48,837
Depreciation
(419
)
(881
)
(1,500
)
(1,500
)
Stock-based compensation expense
(1,407
)
(816
)
(3,927
)
(3,724
)
Purchase consideration expense (3)
(367
)
(816
)
(1,252
)
(1,467
)
Variable consultant performance bonus
expense (4)
—
(397
)
—
(1,028
)
Contribution of business held for sale
(2)
—
—
—
(188
)
Acquisition and due diligence costs
(5)
(368
)
(3,177
)
(3,257
)
(8,253
)
Severance and executive transition
costs
(295
)
(363
)
(819
)
(1,272
)
Non-GAAP general and administrative
expenses
11,565
11,814
34,378
31,405
GAAP amortization
(6,025
)
(6,454
)
(18,006
)
(17,087
)
GAAP loss from operations
(22,492
)
(25,183
)
(67,167
)
(79,773
)
Total non-GAAP adjustments (1)
11,395
14,716
36,026
42,886
Non-GAAP loss from operations
(11,097
)
(10,467
)
(31,141
)
(36,887
)
GAAP other income (expense), net
(2,594
)
(2,552
)
(8,618
)
1,088
Gain on debt extinguishment
—
—
(8
)
—
Loss (gain) on sale
—
—
172
(2,572
)
Foreign currency impact
(393
)
2,294
(29
)
(526
)
Interest expense, net
2,987
314
8,485
2,064
Non-GAAP other expense, net
—
56
2
54
GAAP loss before income taxes
(25,086
)
(27,735
)
(75,785
)
(78,685
)
Total non-GAAP adjustments (1)
13,989
17,324
44,646
41,852
Non-GAAP loss before income taxes
(11,097
)
(10,411
)
(31,139
)
(36,833
)
(Benefit from) provision for income
taxes
(2,575
)
(1,003
)
(3,713
)
(2,673
)
GAAP net loss
(22,511
)
(26,732
)
(72,072
)
(76,012
)
Total non-GAAP adjustments (1)
11,414
16,321
40,933
39,179
Non-GAAP net loss from continuing
operations
(11,097
)
(10,411
)
(31,139
)
(36,833
)
Non-GAAP net income from discontinued
operations
3,984
2,468
9,560
6,310
Non-GAAP net loss
$
(7,113
)
$
(7,943
)
$
(21,579
)
$
(30,523
)
Shares used in computing non-GAAP basic
and diluted net loss per share (in 000's)
38,087
36,992
37,753
36,811
Basic and diluted net loss per share from
continuing operations
$
(0.29
)
$
(0.28
)
$
(0.82
)
$
(1.00
)
Basic and diluted net income per share
from discontinued operations
$
0.10
$
0.07
$
0.25
$
0.17
Non-GAAP basic and diluted net loss per
share
$
(0.19
)
$
(0.21
)
$
(0.57
)
$
(0.83
)
(1) Adjustments are comprised of the adjustments to GAAP cost of
revenue, sales and marketing expenses, research and development
expenses and general and administrative expenses and other income
(expense), net (where applicable) listed above. (2) Contribution of
business held for sale relates to the net loss for the periods
presented for our Energy Group that we divested during Q2 2023. (3)
Purchase consideration expense includes consideration related to
acquisitions. (4) Variable consultant performance bonus expense
represents the bonus payments paid to Mr. Chad Steelberg as a
result of his achievement of the performance goals pursuant to his
consulting agreement with us. (5) For the three and nine months
ended September 30, 2024, acquisition and due diligence costs are
comprised of professional fees related to our acquisitions and
divestitures.
VERITONE, INC. SUPPLEMENTAL FINANCIAL
INFORMATION
We are providing the following unaudited supplemental financial
information as a lookback of prior years to explain our recent
historical and year-over-year performance.
Software Products & Services Supplemental Financial
Information
Quarter Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022 (1)
2022 (1)
2022 (1)
2022 (1)
2023 (1)
2023 (1)
2023
2023
2024
2024
2024
Pro Forma Software Revenue (in 000's)
(2)
$
26,319
$
26,650
$
28,603
$
35,612
$
22,423
$
20,859
$
20,361
$
19,824
$
15,223
$
15,632
$
14,694
Total Software Products & Services
Customers (3)
3,673
3,718
3,787
3,824
3,773
3,705
3,536
3,459
3,384
3,437
3,291
Annual Recurring Revenue (SaaS) (in 000's)
(4)
$
48,392
$
44,465
$
43,925
$
46,248
$
45,453
$
47,720
$
47,756
$
49,122
$
49,064
$
49,223
$
48,269
Annual Recurring Revenue (Consumption) (in
000's) (5)
$
87,445
$
85,901
$
85,091
$
71,754
$
67,242
$
60,229
$
41,543
$
30,967
$
23,510
$
18,701
$
15,011
Total New Bookings (in 000's) (6)
$
16,643
$
22,009
$
23,793
$
26,342
$
22,794
$
8,388
$
15,501
$
17,457
$
12,964
$
14,047
$
16,471
Gross Revenue Retention (7)
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
(1) All of the supplemental financial information for this
period reflects the historical information of Veritone combined
with the historical information of Broadbean as if Veritone had
acquired Broadbean on January 1, 2022. Veritone completed its
acquisition of Broadbean on June 13, 2023. (2) “Pro Forma Software
Revenue” is a non-GAAP measure that represents Software Products
& Services revenue as if Veritone had acquired Broadbean on
January 1, 2022. Veritone completed its acquisition of Broadbean on
June 13, 2023. (3) “Total Software Products & Services
Customers” includes Software Products & Services customers as
of the end of each respective quarter set forth above with net
revenues in excess of $10 and also excludes any customers
categorized by us as trial or pilot status. In prior periods, we
provided “Ending Software Customers,” which represented Software
Products & Services customers as of the end of each fiscal
quarter with trailing twelve-month revenues in excess of $2,400 for
both Veritone, Inc. and PandoLogic Ltd. and/or deemed by the
Company to be under an active contract for the applicable periods.
Total Software Products & Services Customers is not comparable
to Ending Software Customers. Total Software Products &
Services Customers includes customers based on revenues in the last
month of the quarter rather than on a trailing twelve-month basis.
Total Software Products & Services Customers includes customers
based on revenues in the last month of the quarter rather than on a
trailing twelve-month basis and excludes any customers that are on
trial or pilot status with us rather than including customers with
active contracts. Management uses Total Software Products &
Services Customers and we believe Total Software Products &
Services Customers are useful to investors because it more
accurately reflects our total customers for our Software Products
& Services customers inclusive of Broadbean. (4) “Annual
Recurring Revenue (SaaS)” represents an annualized calculation of
monthly recurring revenue during the last month of the applicable
quarter for all Total Software Products & Services customers,
in each case as if Veritone had acquired Broadbean on January 1,
2022. Veritone completed its acquisition of Broadbean on June 13,
2023.. In prior periods, we provided “Average Annual Revenue,”
which was calculated as the aggregate of trailing twelve-month
Software Products & Services revenue divided by the average
number of customers over the same period for both Veritone, Inc.
and PandoLogic Ltd. Annual Recurring Revenue is not comparable to
Average Annual Revenue (SaaS). Annual Recurring Revenue (SaaS)
includes only subscription-based SaaS revenue, is not averaged
among active customers and uses a calculation of recurring revenue
as described above instead of annual revenue. Management uses
“Annual Recurring Revenue (SaaS)” and we believe Annual Recurring
Revenue (SaaS) is useful to investors because Broadbean
significantly increases our mix of subscription-based SaaS revenues
as compared to Consumption revenues and the split between the two
allows the reader to delineate between predictable recurring SaaS
revenues and more volatile Consumption revenues. (5) “Annual
Recurring Revenue (Consumption)” represents the trailing twelve
months of all non-recurring and/or consumption-based revenue for
all active Total Software Products & Services customers, in
each case, as if Veritone had acquired Broadbean on January 1,
2022. Veritone completed its acquisition of Broadbean on June 13,
2023.. In prior periods, we provided “Average Annual Revenue,”
which was calculated as the aggregate of trailing twelve-month
Software Products & Services revenue divided by the average
number of customers over the same period for both Veritone, Inc.
and PandoLogic Ltd. Annual Recurring Revenue (Consumption) is not
comparable to Average Annual Revenue. Annual Recurring Revenue
(Consumption) includes only non-recurring and/or consumption-based
revenue, is not averaged among active customers and uses a
calculation of recurring revenue as described above instead of
annual revenue. Management uses “Annual Recurring Revenue
(Consumption)” and we believe Annual Recurring Revenue
(Consumption) is useful to investors because Broadbean
significantly increases our mix of subscription-based SaaS revenues
as compared to Consumption revenues and the split between the two
allows the reader to delineate between predictable recurring SaaS
revenues and more volatile Consumption revenues. (6) “Total New
Bookings” represents the total fees payable during the full
contract term for new contracts received in the quarter (including
fees payable during any cancellable portion and an estimate of
license fees that may fluctuate over the term), excluding any
variable fees under the contract (e.g., fees for cognitive
processing, storage, professional services and other variable
services), in each case as if Veritone had acquired Broadbean on
January 1, 2022. Veritone completed its acquisition of Broadbean on
June 13, 2023. (7) “Gross Revenue Retention” represents a
calculation of our dollar-based gross revenue retention rate as of
the period end by starting with the revenue from Software Products
& Services Customers as of the 3 months in the prior year
quarter to such period, or Prior Year Quarter Revenue. We then
deduct from the Prior Year Quarter Revenue any revenue from
Software Products & Services Customers who are no longer
customers as of the current period end, or Current Period Ending
Software Customer Revenue. We then divide the total Current Period
Ending Software Customer Revenue by the total Prior Year Quarter
Revenue to arrive at our dollar-based gross retention rate, which
is the percentage of revenue from all Software Products &
Services Customers from our Software Products & Services as of
the year prior that is not lost to customer churn. All numbers used
to determine Gross Revenue Retention are calculated as if Veritone
had acquired Broadbean on January 1, 2022. Veritone completed its
acquisition of Broadbean on June 13, 2023.
The following table sets forth the reconciliation of revenue to
pro forma revenue and the calculation of pro forma annual recurring
revenue.
Quarter Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022
2022
2022
2022
2023
2023
2023
2023
2024
2024
2024
Software Products & Services Revenue
(in 000’s)
$
18,167
$
18,379
$
20,812
$
27,220
$
14,127
$
14,093
$
20,361
$
19,820
$
15,220
$
15,632
$
14,694
Broadbean Revenue (in 000’s) (1)
6,204
6,974
7,639
8,230
8,156
8,374
8,739
8,662
8,517
8,690
8,169
Broadbean Revenue included in Software
Products & Services Revenue (in 000’s)
—
—
—
—
—
(1,716
)
(8,739
)
(8,662
)
(8,517
)
(8,690
)
(8,169
)
Pro Forma Software Revenue (in 000’s)
$
24,371
$
25,353
$
28,451
$
35,450
$
22,283
$
20,751
$
20,361
$
19,820
$
15,220
$
15,632
$
14,694
Managed Services Revenue (in 000’s)
16,240
15,856
16,384
16,670
16,136
13,874
14,772
14,377
16,416
15,360
7,299
Total Pro Forma Revenue (in 000’s)
$
40,611
$
41,209
$
44,835
$
52,120
$
38,419
$
34,625
$
35,133
$
34,197
$
31,636
$
30,992
$
21,993
Trailing Twelve Months
Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022
2022
2022
2022
2023
2023
2023
2023
2024
2024
2024
Software Products & Services Revenue
(in 000’s)
$
72,997
$
85,796
$
97,581
$
84,578
$
80,538
$
76,252
$
75,801
$
68,401
$
69,494
$
71,033
$
65,366
Broadbean Revenue (in 000’s) (1)
29,599
30,006
30,136
29,047
30,999
32,399
33,499
33,931
34,292
34,608
34,038
Broadbean Revenue included in Software
Products & Services Revenue (in 000’s)
—
—
—
—
—
(1,716
)
(10,455
)
(19,117
)
(27,634
)
(34,608
)
(34,038
)
Pro Forma Software Revenue (in 000’s)
$
102,596
$
115,802
$
127,717
$
113,625
$
111,537
$
106,935
$
98,845
$
83,215
$
76,152
$
71,033
$
65,366
Managed Services Revenue (in 000’s)
58,419
60,546
63,406
65,150
65,046
63,064
61,452
59,159
59,439
60,925
53,452
Total Pro Forma Revenue (in 000’s)
$
161,015
$
176,348
$
191,123
$
178,775
$
176,583
$
169,999
$
160,297
$
142,374
$
135,591
$
131,958
$
118,818
Pro Forma Total Number of Customers
3,673
3,718
3,787
3,824
3,773
3,705
3,536
3,459
3,384
3,437
3,291
Pro Forma Annual Recurring Revenue (in
000’s) (2)
$
135,837
$
130,366
$
129,016
$
118,002
$
112,695
$
107,949
$
89,299
$
80,089
$
72,574
$
67,924
$
63,280
(1) “Pro Forma Software Revenue” includes historical Software
Products & Services Revenue from the past eleven (11) fiscal
quarters of each of Veritone, Inc. and Broadbean and presents such
revenue on a combined basis treating Broadbean as owned by
Veritone, Inc. since January 1, 2022. (2) “Pro Forma Annual
Recurring Revenue” represents an annualized calculation of the
monthly recurring revenue in the last period of the calculated
quarter, combined with the trailing twelve month calculation for
all non-recurring and/or consumption based revenue for all active
customers.
VERITONE, INC.
RECONCILIATION OF NON-GAAP GROSS PROFIT TO LOSS FROM
OPERATIONS (in thousands)
(dollars in thousands)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Loss from operations
$
(22,492
)
$
(25,183
)
$
(67,167
)
$
(79,773
)
Sales and marketing
10,186
10,997
31,230
32,895
Research and development
7,528
10,410
23,388
32,456
General and administrative
14,421
18,264
45,133
48,837
Amortization
6,025
6,454
18,006
17,087
Non-GAAP gross profit
$
15,668
$
20,942
$
50,590
$
51,502
Non-GAAP gross margin
71.2
%
74.9
%
72.1
%
70.7
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241111849905/en/
Company Contact: Mike Zemetra Chief Financial Officer
Veritone, Inc. investors@veritone.com IR Agency Contact:
Cate Goldsmith Prosek Partners 914-815-7678
cgoldsmith@prosek.com
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