UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE TRANSITION PERIOD FROM TO
Commission File Number:
(Exact Name of Registrant as Specified in its Charter)
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(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
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(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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(Nasdaq Global Select Market) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of August 11, 2021 there were
Table of Contents
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Page |
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PART I. |
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Item 1. |
3 |
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A. |
3 |
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B. |
4 |
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C. |
Condensed Consolidated Statements of Convertible Preferred Units and Equity |
5 |
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D. |
7 |
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E. |
8 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
22 |
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Item 3. |
37 |
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Item 4. |
37 |
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PART II. |
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Item 1. |
38 |
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Item 1A. |
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Item 2. |
39 |
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Item 3. |
39 |
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Item 4. |
39 |
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Item 5. |
39 |
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Item 6. |
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41 |
2
PART I—FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (unaudited).
VIANT TECHNOLOGY INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share/unit data)
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As of June 30, |
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As of December 31, |
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2021 |
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2020 |
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Assets |
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Current assets: |
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Cash |
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$ |
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$ |
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Accounts receivable, net of allowances |
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Prepaid expenses and other current assets |
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Total current assets |
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Property, equipment, and software, net |
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Intangible assets, net |
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Goodwill |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities, convertible preferred units and stockholders' equity/members' equity |
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Liabilities |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued liabilities |
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Accrued compensation |
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Current portion of long-term debt |
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— |
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Current portion of deferred revenue |
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Accrued member tax distributions |
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Other current liabilities |
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Total current liabilities |
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Long-term debt |
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Long-term portion of deferred revenue |
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Other long-term liabilities |
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Total liabilities |
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Commitments and contingencies (Note 12) |
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Convertible preferred units |
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2019 convertible preferred units, no par value; and preference $ |
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— |
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Members' equity |
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Common units, no par value; authorized, issued and outstanding as of December 31, 2020 |
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— |
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— |
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Additional paid-in capital |
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— |
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Accumulated deficit |
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— |
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( |
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Stockholders’ equity |
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Preferred stock, $ outstanding as of June 30, 2021 |
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Class A common stock, $ |
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— |
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Class B common stock, $ |
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— |
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Additional paid-in capital |
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— |
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Accumulated deficit |
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( |
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— |
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Total stockholders' equity attributable to Viant Technology Inc./members' equity |
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Noncontrolling interests |
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— |
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Total equity |
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Total liabilities, convertible preferred units and stockholders' equity/members' equity |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
VIANT TECHNOLOGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share/unit data)
(Unaudited)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2021 |
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2020 |
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2021 |
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2020 |
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Revenue |
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$ |
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$ |
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$ |
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$ |
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Operating expenses: |
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Platform operations |
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Sales and marketing |
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Technology and development |
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General and administrative |
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Total operating expenses |
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Income (loss) from operations |
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( |
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( |
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Interest expense, net |
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Other expense (income), net |
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( |
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Gain on extinguishment of debt |
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( |
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— |
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( |
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— |
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Total other expense (income), net |
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( |
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( |
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Net income (loss) |
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( |
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( |
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( |
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Less: Net loss attributable to noncontrolling interests |
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( |
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— |
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( |
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— |
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Net income (loss) attributable to Viant Technology Inc. |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
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Earnings (loss) per Class A common stock/unit: |
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Basic |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
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Diluted |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
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Weighted-average Class A common stock/units outstanding: |
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Basic |
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Diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
4
VIANT TECHNOLOGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED UNITS AND EQUITY
(In thousands)
(Unaudited)
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Convertible Preferred Units |
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Common Units |
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Class A Common Stock |
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Class B Common Stock |
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Additional Paid-In |
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Accumulated |
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Members' |
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Noncontrolling |
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Total |
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Units |
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Amount |
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Units |
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Amount |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Equity |
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Interests |
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Equity |
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Balance as of December 31, 2020 |
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$ |
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$ |
— |
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— |
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$ |
— |
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— |
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$ |
— |
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$ |
— |
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$ |
— |
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$ |
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$ |
— |
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$ |
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Net income prior to Reorganization Transactions |
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Effect of Reorganization Transactions |
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( |
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( |
) |
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( |
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— |
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( |
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Issuance of Class A common stock in initial public offering, net of underwriting and offering costs |
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( |
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( |
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Allocation of equity to noncontrolling interests |
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( |
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— |
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Accrued member tax distributions |
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Stock-based compensation |
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Net loss subsequent to Reorganization Transactions |
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( |
) |
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( |
) |
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( |
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Balance as of March 31, 2021 |
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— |
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$ |
— |
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— |
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$ |
— |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
— |
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$ |
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$ |
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Accrued member tax distributions |
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( |
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( |
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Stock-based compensation |
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Net loss |
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( |
) |
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( |
) |
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( |
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Balance as of June 30, 2021 |
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— |
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$ |
— |
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— |
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$ |
— |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
— |
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$ |
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$ |
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5
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Convertible Preferred Units |
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Common Units |
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Additional Paid-In |
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Accumulated |
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Total Members' |
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Units |
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Amount |
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Units |
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Amount |
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Capital |
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Deficit |
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Equity |
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Balance as of December 31, 2019 |
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$ |
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$ |
— |
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$ |
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$ |
( |
) |
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$ |
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Accrued member tax distributions |
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( |
) |
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( |
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Net income |
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Balance as of March 31, 2020 |
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$ |
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$ |
— |
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$ |
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$ |
( |
) |
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$ |
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Accrued member tax distributions |
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( |
) |
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( |
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Net loss |
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( |
) |
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( |
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Balance as of June 30, 2020 |
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$ |
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$ |
— |
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$ |
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$ |
( |
) |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
6
VIANT TECHNOLOGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
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Six Months Ended June 30, |
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2021 |
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2020 |
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Cash flows from operating activities: |
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Net income (loss) |
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$ |
( |
) |
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$ |
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Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
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Depreciation and amortization |
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Stock-based compensation |
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— |
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Recovery of doubtful accounts |
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( |
) |
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( |
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Loss on disposal of assets |
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— |
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Gain on extinguishment of debt |
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( |
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— |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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Prepaid expenses and other assets |
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( |
) |
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( |
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Accounts payable |
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( |
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Accrued liabilities |
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( |
) |
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( |
) |
Accrued compensation |
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( |
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( |
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Deferred revenue |
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( |
) |
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( |
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Other liabilities |
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( |
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( |
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Net cash provided by operating activities |
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
|
( |
) |
|
|
( |
) |
Capitalized software development costs |
|
|
( |
) |
|
|
( |
) |
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds from Paycheck Protection Program Loan |
|
|
— |
|
|
|
|
|
Proceeds from issuance of common stock, net of underwriting discounts |
|
|
|
|
|
|
— |
|
Payment of member tax distributions |
|
|
( |
) |
|
|
— |
|
Payment of offering costs |
|
|
( |
) |
|
|
— |
|
Net cash provided by financing activities |
|
|
|
|
|
|
|
|
Net increase in cash |
|
|
|
|
|
|
|
|
Cash at beginning of period |
|
|
|
|
|
|
|
|
Cash at end of period |
|
$ |
|
|
|
$ |
|
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
|
|
|
$ |
|
|
Supplemental disclosure of non-cash investing and financing activities: |
|
|
|
|
|
|
|
|
Stock-based compensation included in capitalized software development costs |
|
|
|
|
|
|
— |
|
Accrued member tax distributions |
|
|
|
|
|
|
|
|
Capitalized assets financed by accounts payable and accrued liabilities |
|
|
|
|
|
|
|
|
Noncash gain on extinguishment of debt related to Paycheck Protection Program loan |
|
|
|
|
|
|
— |
|
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
VIANT TECHNOLOGY INC.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Nature of Operations
Viant Technology Inc. (the “Company,” “we,” “us,” “our” or “Viant”) was incorporated in the State of Delaware on October 9, 2020 for the purpose of facilitating an Initial Public Offering and other related transactions. The Company operates a demand side platform (“DSP”), Adelphic, an enterprise software platform that is used by marketers and their advertising agencies to centralize the planning, buying and measurement of their advertising across channels, including desktop, mobile, connected TV, linear TV, streaming audio and digital billboards.
On February 9, 2021, the Company’s Form S-1 was declared effective by the SEC related to the IPO of its Class A common stock. The closing date of the IPO was February 12, 2021, and in connection with the closing and the corporate reorganization (the “Reorganization Transactions”), the following actions were taken:
|
• |
The Company amended and restated its certificate of incorporation, under which the Company is authorized to issue up to |
|
• |
The limited liability company agreement of Viant Technology LLC was amended and restated (as amended and restated, the “Viant Technology LLC Agreement”) to, among other things, provide for Class A units and Class B units and appoint the Company as the sole managing member of Viant Technology LLC; |
|
• |
The Viant Technology LLC Agreement classifies the interests acquired by the Company as Class A units, reclassified the interests held by the continuing members of Viant Technology LLC as Class B units, and permits the continuing members of Viant Technology LLC to exchange Class B units for shares of Class A common stock on a |
|
• |
The Company issued and sold |
|
• |
The Company used the net proceeds of $ |
|
• |
The underwriters exercised their option to purchase |
|
• |
|
|
• |
The Company entered into a Registration Rights Agreement with the Class B stockholders to provide for certain rights and restrictions after the IPO; and |
|
• |
The 2020 Equity Based Incentive Compensation Plan (the “Phantom Unit Plan”) under Viant Technology LLC, was terminated and replaced in conjunction with the adoption of the Company’s 2021 Long Term Incentive Plan (the “LTIP”) |
8
Immediately following the closing of the IPO, Viant Technology LLC is the predecessor of the Company for financial reporting purposes. The Company is a holding company, and its sole material asset is its equity interest in Viant Technology LLC. As the sole managing member of Viant Technology LLC, the Company operates and controls all of the business and affairs of Viant Technology LLC. The Reorganization Transactions are accounted for as a reorganization of entities under common control. As a result, the condensed consolidated financial statements of the Company recognize the assets and liabilities received in the Reorganization Transactions at their historical carrying amounts, as reflected in the historical consolidated financial statements of Viant Technology LLC. The Company will consolidate Viant Technology LLC on its condensed consolidated financial statements and record a noncontrolling interest related to the Class B units held by the Class B stockholders on its condensed consolidated balance sheet and statement of operations.
2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
The accompanying condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information which are unaudited and include the operations of the Company, Viant Technology LLC and its wholly owned subsidiaries. Viant Technology LLC is considered a variable interest entity, or VIE. The Company is the primary beneficiary and sole managing member of Viant Technology LLC and has decision making authority that significantly affects the economic performance of the entity. As a result, the Company consolidates Viant Technology LLC. All intercompany balances and transactions have been eliminated in consolidation.
Viant Technology LLC has been determined to be the predecessor for accounting purposes and, accordingly, the condensed consolidated financial statements for periods prior to the IPO and the related organizational transactions have been adjusted to combine the previously separate entities for presentation purposes. Amounts for the period from January 1, 2020 through February 11, 2021 presented in the condensed consolidated financial statements and notes to condensed consolidated financial statements herein represent the historical operations of Viant Technology LLC. The amounts as of June 30, 2021 and for the period from February 12, 2021 reflect the consolidated operations of the Company.
Management believes that the accompanying condensed consolidated financial statements reflect all adjustments necessary for the fair statement of its condensed consolidated balance sheet as of June 30, 2021, results of operations for the three and six months ended June 30, 2021 and 2020, and cash flows for the six months ended June 30, 2021 and 2020. The condensed consolidated balance sheet as of December 31, 2020 was derived from the audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2020.
The condensed consolidated results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021, or for any other future annual or interim period.
Use of Estimates
The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. On an on-going basis, management evaluates its estimates, primarily those related to revenue recognition, stock-based compensation, income taxes, allowances for doubtful accounts, the useful lives of capitalized software development costs and other property, equipment and software, assumptions used in the impairment analyses of long-lived assets and goodwill, deferred revenue and accrued liabilities. These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amount of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
As of June 30, 2021, the impact of the COVID-19 pandemic on our business continues to evolve. As a result, many of our estimates and assumptions consider macro-economic factors in the market, which require increased judgment and carry a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, our estimates may change materially in future periods.
9
Fair Value of Financial Instruments
Financial instruments consist of cash, accounts receivable, accounts payable, accrued liabilities and debt. The carrying amounts of the Company’s current financial assets and current financial liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments.
Stock-Based Compensation
Stock-based compensation relates to equity awards granted under the Company’s 2021 LTIP, which is measured and recognized in the condensed consolidated financial statements based on the fair value of the equity awards granted. Since inception of the 2021 LTIP, the Company has only granted restricted stock units (“RSUs”) and nonqualified stock options. The fair value of RSUs is calculated using the closing market price of the Company’s common stock on the date of grant. The fair value of non-qualified stock options is estimated using the Black Scholes option pricing model. The Black Scholes option pricing model is impacted by the fair value of the Company’s common stock, as well as changes in certain assumptions, including but not limited to, the expected common stock price volatility over the term of the nonqualified stock options, the expected term of the nonqualified stock options, the risk-free interest rate, and the expected dividend yield.
A portion of RSUs granted as of June 30, 2021 to certain employees and board members, pursuant to the 2021 LTIP, will vest upon expiration of the
Comprehensive Income (Loss)
For the periods presented, net income (loss) is equal to comprehensive income (loss).
Noncontrolling Interests
The noncontrolling interests represent the economic interests of Viant Technology LLC held by Class B common stockholders. Income or loss is attributed to the noncontrolling interests based on the weighted average LLC interests outstanding during the period. The noncontrolling interests’ ownership percentage can fluctuate over time as the Class B common stockholders elect to exchange their shares of Class B common stock for Class A common stock.
Earnings (Loss) Per Share
Basic earnings (loss) per share is calculated by dividing the earnings (loss) attributable to Class A common stockholders by the number of weighted-average shares of Class A common stock outstanding. The Company’s RSUs, nonqualified stock options and shares of Class B common stock do not share in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted earnings (loss) per share of RSUs, nonqualified stock options and Class B common stock under the two-class method has not been presented.
Diluted earnings (loss) per share adjusts the basic earnings (loss) per share calculation for the potential dilutive impact of common shares such as equity awards using the treasury-stock method. Diluted earnings (loss) per share considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares would have an anti-dilutive effect. Shares of our Class B common stock, RSUs, and nonqualified stock options are considered potentially dilutive shares of Class A common stock; however, related amounts have been excluded from the computation of diluted earnings (loss) per share of Class A common stock because the effect would have been anti-dilutive under the if-converted method.
Earnings (Loss) Per Unit
Basic earnings (loss) per unit is calculated by dividing the earnings (loss) attributable to common unitholders by the number of weighted-average common units outstanding. The Company applies the two-class method to allocate earnings between common and convertible preferred units.
Diluted earnings (loss) per unit adjusts the basic earnings (loss) per unit attributable to common unitholders and the weighted-average number of units of common units outstanding for the potential dilutive impact of common units, using the treasury-stock method, and convertible preferred units using the if-converted method. Diluted earnings (loss) per unit considers the impact of
10
potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common units would have an anti-dilutive effect.
Accounts Receivable, Net of Allowances
The following table presents changes in the allowance for doubtful accounts for the three and six months ended June 30, 2021:
|
|
(in thousands) |
|
|
Balance as of December 31, 2020 |
|
$ |
|
|
Recovery of doubtful accounts |
|
|
( |
) |
Write-offs, net of recoveries |
|
|
( |
) |
Balance as of March 31, 2021 |
|
$ |
|
|
Recovery of doubtful accounts |
|
|
( |
) |
Write-offs, net of recoveries |
|
|
( |
) |
Balance as of June 30, 2021 |
|
$ |
|
|
Deferred Offering Costs
Deferred offering costs consisted primarily of accounting, legal, and other costs related to our IPO. As of December 31, 2020, the Company capitalized $
Concentration of Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and accounts receivable. The Company maintains its cash with financial institutions and its cash levels exceed the Federal Deposit Insurance Corporation (FDIC) federally insured limits. Accounts receivable include amounts due from customers with principal operations primarily in the United States.
As of June 30, 2021,
Income Taxes
The Company is the managing member of Viant Technology LLC and, as a result, consolidates the financial results of Viant Technology LLC in the unaudited condensed consolidated financial statements. Viant Technology LLC is a pass-through entity for U.S. federal and most applicable state and local income tax purposes following a corporate reorganization effected in connection with our initial public offering. As an entity classified as a partnership for tax purposes, Viant Technology LLC is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Viant Technology LLC is passed through to, and included in the taxable income or loss of its members, including us. The Company is taxed as a corporation and pays corporate federal, state and local taxes with respect to income allocated from Viant Technology LLC, based on Viant Technology Inc.'s
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities (“DTAs” and “DTLs”) for the expected future tax consequences of events that have been included in the financial
11
statements. Under this method, we determine DTAs and DTLs on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on DTAs and DTLs is recognized in income in the period that includes the enactment date. We recognize DTAs to the extent that we believe that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. If we determine that we would be able to realize our DTAs in the future in excess of their net recorded amount, we would make an adjustment to the DTA valuation allowance, which would reduce the provision for income taxes.
The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.
Tax Receivable Agreement
The Company expects to obtain an increase in its share of tax basis in the net assets of Viant Technology LLC when Class B units are exchanged by the holders of Class B units for shares of Class A common stock of the Company and upon other qualifying transactions. Each change in outstanding shares of Class A common stock of the Company results in a corresponding increase or decrease in the Company's ownership of Class A units of Viant Technology LLC. The Company intends to treat any exchanges of Class B units as direct purchases of LLC interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that Viant Technology Inc. would otherwise pay in the future to various taxing authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets.
In connection with the IPO, the Company entered into a Tax Receivable Agreement (“TRA”) with Viant Technology LLC and the holders of Class B units of Viant Technology LLC (the “Members”). In the event that such parties exchange any or all of their Class B units for Class A common stock, the TRA requires the Company to make payments to such holders for
The timing and amount of aggregate payments due under the TRA may vary based on a number of factors, including the amount and timing of the taxable income the Company generates each year and the tax rate then applicable. The Company calculates the liability under the TRA using a TRA model, which includes an assumption related to the fair market value of assets. The payment obligations under the TRA are obligations of Viant Technology Inc. and not of Viant Technology LLC. Payments are generally due under the TRA within a specified period of time following the filing of the Company’s tax return for the taxable year with respect to which the payment obligation arises, although interest on such payments will begin to accrue at a rate of the Secured Overnight Financing Rate plus
The TRA provides that if (i) certain mergers, asset sales, other forms of business combinations, or other changes of control were to occur, (ii) there is a material breach of any material obligations under the TRA; or (iii) the Company elects an early termination of the TRA, then the TRA will terminate and the Company's obligations, or the Company's successor’s obligations, under the TRA will accelerate and become due and payable, based on certain assumptions, including an assumption that the Company would have sufficient taxable income to fully utilize all potential future tax benefits that are subject to the TRA and that any Class B units that have not been exchanged are deemed exchanged for the fair market value of the Company's Class A common stock at the time of termination.
Recent Issued Accounting Pronouncements
On April 5, 2012, the Jumpstart Our Business Startups Act (the “JOBS Act”) was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth
12
company,” the Company may, under Section 7(a)(2)(B) of the Securities Act, delay adoption of new or revised accounting standards applicable to public companies until such standards would otherwise apply to private companies. An “emerging growth company” is one with less than $1.07 billion in annual sales, has less than $700 million in market value of its shares of common stock held by non-affiliates and issues less than $1 billion of non-convertible debt over a three year period. The Company may take advantage of this extended transition period until the first to occur of the date that it (i) is no longer an “emerging growth company” or (ii) affirmatively and irrevocably opts out of this extended transition period.
The Company has elected to take advantage of the benefits of this extended transition period. Until the date that the Company is no longer an “emerging growth company” or affirmatively and irrevocably opts out of the exemption provided by Securities Act Section 7(a)(2)(B), upon issuance of a new or revised accounting standard that applies to its condensed consolidated financial statements and that has a different effective date for public and private companies, the Company will disclose the date on which it will adopt the recently issued accounting standard.
In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), which requires an entity to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. The guidance offers specific accounting guidance for a lessee, lessor, and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Leases will be classified as either finance or operating, with the classification affecting the pattern of expense recognition in the income statement. In March 2019, the FASB issued ASU No. 2019-01 which made further targeted improvements including clarification regarding the determination of fair value of lease assets and liabilities and statement of cash flows and presentation guidance. In June 2020, FASB issued ASU 2020-05, which extended the effective date of this guidance for non-public entities to fiscal years beginning after December 15, 2021. As a part of the Company’s election under the JOBS Act, the guidance is effective for the Company’s annual reporting period beginning after December 15, 2021 and interim reporting periods within the annual period beginning after December 15, 2022. The Company is currently assessing the impact this guidance will have on the condensed consolidated financial statements.
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326). ASU 2016-13 revises the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in more timely recognition of losses on financial instruments, including, but not limited to, available for sale debt securities and accounts receivable. The guidance is effective for the Company’s annual reporting period beginning after December 15, 2022 and interim reporting periods within that annual reporting period. The Company does not expect the adoption of this ASU to have a material impact on the condensed consolidated financial statements.
In October 2020, the FASB issued ASU No. 2020-10, Codification Improvements, which updates various codification topics by clarifying disclosure requirements to align with the SEC's regulations. The guidance is effective for the Company’s annual reporting period beginning after December 15, 2021 and interim reporting periods within the annual period beginning after December 15, 2022. The Company is currently assessing the impact this guidance will have on the condensed consolidated financial statements.
In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). The purpose of ASU 2021-04 is to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The ASU requires issuers to account for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after the modification or exchange based on the economic substance of the modification or exchange. In accordance with ASU 2021-04, an issuer determines the accounting for the modification or exchange based on whether the transaction was done to issue equity, to issue or modify debt, or for other reasons. The guidance is effective for the Company’s annual reporting period beginning after December 15, 2021 and interim reporting periods within that annual reporting period. The Company is currently assessing the impact this guidance will have on the condensed consolidated financial statements.
Recent Adopted Accounting Pronouncements
In September 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a consensus of the FASB Emerging Issues Task Force), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Early adoption is permitted and can be applied prospectively to all implementation costs incurred after the date of adoption or retrospectively. This guidance is effective for the Company’s annual reporting period beginning after
13
December 15, 2020. The Company adopted this ASU prospectively on
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for the Company’s annual reporting period beginning after December 15, 2020. The Company adopted ASU 2019-12 prospectively on
3. Revenue
The disaggregation of revenue was as follows:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Over-time revenue |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Point-in-time revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Remaining performance obligations for contracts with an original expected duration of greater than one year amounted to $
During the six months ended June 30, 2021, we recognized $
4. Property, Equipment and Software, Net
Major classes of property, equipment and software were as follows:
|
|
As of June 30, |
|
|
As of December 31, |
|
||
|
|
2021 |
|
|
2020 |
|
||
|
|
(in thousands) |
|
|||||
Capitalized software development costs |
|
$ |
|
|
|
$ |
|
|
Computer equipment |
|
|
|
|
|
|
|
|
Purchased software |
|
|
|
|
|
|
|
|
Furniture, fixtures and office equipment |
|
|
|
|
|
|
|
|
Leasehold improvements |
|
|
|
|
|
|
|
|
Total property, equipment and software |
|
|
|
|
|
|
|
|
Less: Accumulated depreciation |
|
|
( |
) |
|
|
( |
) |
Total property, equipment and software, net |
|
$ |
|
|
|
$ |
|
|
Depreciation recorded in the condensed consolidated statements of operations was as follows:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Platform operations |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Sales and marketing |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Technology and development |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
14
For the three months ended June 30, 2021 and 2020, total interest cost incurred was $
5. Intangible Assets, Net
The balances of intangibles assets and accumulated amortization are as follows:
|
|
As of June 30, 2021 |
|
|||||||||||||
|
|
Remaining Weighted Average Useful Life |
|
|
Gross Amount |
|
|
Accumulated Amortization |
|
|
Net Carrying Amount |
|
||||
|
|
(in years) |
|
|
(in thousands) |
|
||||||||||
Developed technology |
|
|
|
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
|
|
Customer relationships |
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
Trademarks/tradenames |
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
Total |
|
|
|
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
|
|
|
|
As of December 31, 2020 |
|
|||||||||||||
|
|
Remaining Weighted Average Useful Life |
|
|
Gross Amount |
|
|
Accumulated Amortization |
|
|
Net Carrying Amount |
|
||||
|
|
(in years) |
|
|
(in thousands) |
|
||||||||||
Developed technology |
|
|
|
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
|
|
Customer relationships |
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
Trademarks/tradenames |
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
Total |
|
|
|
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
|
|
Amortization recorded in the condensed consolidated statements of operations was as follows:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Platform operations |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Sales and marketing |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Technology and development |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
General and administrative |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Estimated future amortization of intangible assets as of June 30, 2021 is as follows:
|
|
As of June 30, 2021 |
|
|
Year |
|
(in thousands) |
|
|
Remainder of 2021 |
|
$ |
|
|
2022 |
|
|
|
|
2023 |
|
|
|
|
2024 |
|
|
|
|
2025 |
|
|
|
|
Thereafter |
|
|
|
|
Total |
|
$ |
|
|
15
6. Accrued Liabilities
The Company’s accrued liabilities consisted of the following:
|
|
As of June 30, |
|
|
As of December 31, |
|
||
|
|
2021 |
|
|
2020 |
|
||
|
|
(in thousands) |
|
|||||
Accrued traffic acquisition costs |
|
$ |
|
|
|
$ |
|
|
Other accrued liabilities |
|
|
|
|
|
|
|
|
Total accrued liabilities |
|
$ |
|
|
|
$ |
|
|
7. Long-Term Debt and Revolving Credit Facility
The Company’s debt and revolving credit facilities consisted of the following:
|
|
As of June 30, |
|
|
As of December 31, |
|
||
|
|
2021 |
|
|
2020 |
|
||
|
|
(in thousands) |
|
|||||
Revolving credit facility |
|
$ |
|
|
|
$ |
|
|
Paycheck Protection Program Loan |
|
|
— |
|
|
|
|
|
Total debt |
|
|
|
|
|
|
|
|
Less: Current portion of long-term debt |
|
|
— |
|
|
|
( |
) |
Total long-term debt |
|
$ |
|
|
|
$ |
|
|
As of December 31, 2020, the current portion of long-term debt related to the Paycheck Protection Program (“PPP”) Loan. The carrying value of the revolving credit facility as of June 30, 2021 and December 31, 2020 approximated its fair value as the interest rate is variable and approximates prevailing market interest rates for similar debt arrangements. The carrying value of the PPP Loan as of December 31, 2020 approximated its fair value which was estimated using quoted market prices, based on estimated incremental borrowing rates for similar types of borrowing arrangements.
PPP Loan
On April 14, 2020, the Company received the proceeds from a loan in the amount of approximately $
Revolving Credit Facility
On
Advances under the Loan Agreement bear interest through maturity at a variable rate based upon our selection of either a Domestic Rate or a LIBOR Rate, plus an applicable margin (“Domestic Rate Loans” and “LIBOR Rate Loans”). The Domestic Rate is defined as a fluctuating interest rate equal to the greater of (1) the base commercial lending rate of PNC Bank, (2) the overnight federal funds rate plus
16
The Loan Agreement contains customary conditions to borrowings, events of default and covenants, including covenants that restrict our ability to sell assets, make changes to the nature of the business, engage in mergers or acquisitions, incur, assume or permit to exist additional indebtedness and guarantees, create or permit to exist liens, pay dividends, issue equity instruments, make distributions or redeem or repurchase capital stock or make other investments, and engage in transactions with affiliates.
8. Stock-Based Compensation
In connection with the IPO, which occurred on February 12, 2021, the Phantom Unit Plan was replaced by the 2021 LTIP. On February 12, 2021,
Stock-Based Compensation
Stock-based compensation recorded in the condensed consolidated statements of operations was as follows:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Platform operations |
|
$ |
|
|
|
$ |
— |
|
|
$ |
|
|
|
$ |
— |
|
Sales and marketing |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
Technology and development |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
General and administrative |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
Total |
|
$ |
|
|
|
$ |
— |
|
|
$ |
|
|
|
$ |
— |
|
RSUs
The following summarizes RSU activity:
|
|
Number of Shares |
|
|
|
|
|
|
|
|
(in thousands) |
|
|
Weighted-Average Grant-Date Fair Value |
|
||
RSUs outstanding as of December 31, 2020 |
|
|
— |
|
|
$ |
— |
|
Granted |
|
|
|
|
|
|
|
|
Vested |
|
|
— |
|
|
|
— |
|
Canceled/forfeited |
|
|
( |
) |
|
|
|
|
RSUs outstanding as of March 31, 2021 |
|
|
|
|
|
|
|
|
Granted |
|
|
|
|
|
|
|
|
Vested |
|
|
— |
|
|
|
— |
|
Canceled/forfeited |
|
|
( |
) |
|
|
|
|
RSUs outstanding as of June 30, 2021 |
|
|
|
|
|
$ |
|
|
As of June 30, 2021, the Company had unrecognized stock-based compensation relating to RSUs of approximately $
17
Nonqualified Stock Options
The following summarizes nonqualified stock option activity:
|
|
Number of Options |
|
|
Weighted-Average Exercise Price |
|
|
Weighted-Average Remaining Contractual Term |
|
|
Aggregate Intrinsic Value |
|
||||
|
|
(in thousands) |
|
|
|
|
|
|
(in years) |
|
|
(in thousands) |
|
|||
Options outstanding as of December 31, 2020 |
|
|
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
Granted |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Exercised |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Canceled |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Expired |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Options outstanding as of March 31, 2021 |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Granted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercised |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Canceled |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Expired |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Options outstanding as of June 30, 2021 |
|
|
|
|
|
$ |
|
|
|
|
|
|
|
$ |
|
|
The weighted-average grant-date fair value of the nonqualified stock options granted during the three and six months ended June 30, 2021 was $
The following table presents the assumptions used in the Black-Scholes model to determine the fair value of nonqualified stock options for the three and six months ended June 30, 2021. Black-Scholes assumptions have not been disclosed for any other periods presented as there were no nonqualified stock options granted in those periods.
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||
|
|
2021 |
|
|
2021 |
|
||
Risk free interest rate |
|
|
|
% |
|
|
|
% |
Expected volatility |
|
|
|
% |
|
|
|
% |
Expected term (in years) |
|
|
|
|
|
|
|
|
Expected dividend yield |
|
|
|
% |
|
|
|
% |
Risk-Free Interest Rate. The Company bases the risk-free interest rate assumption for equity awards on the rates for U.S. Treasury securities with maturities similar to those of the expected term of the award being valued.
Expected Volatility. Due to the limited trading history of the Company’s common stock, the expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of the Company’s own stock price becomes available.
Expected Term. Given the insufficient historical data relating to nonqualified stock option exercises, the expected term assumption is based on expected terms of a peer group of similar companies whose expected terms are publicly available. The Company will continue to apply this process until a sufficient amount of historical information regarding the Company’s nonqualified stock option exercises becomes available.
Expected Dividend Yield. The Company’s expected dividend yield assumption is
18
9. Income Taxes and Tax Receivable Agreement
The provision for income taxes differs from the amount of income tax computed by applying the applicable U.S. statutory federal income tax rate of
As of June 30, 2021, management determined based on applicable accounting standards and the weight of all available evidence, it was not more likely than not (“MLTN”) that the Company will generate sufficient taxable income to realize our deferred tax assets including the difference in our tax basis in excess of the financial reporting value for our investment in Viant Technology LLC. Consequently, we have established a full valuation allowance against our deferred tax assets as of June 30, 2021. In the event that management subsequently determines that it is MLTN that we will realize our deferred tax assets in the future over the recorded amount, a decrease to the valuation allowance will be made, which will reduce the provision for income taxes.
The Company has concluded based on applicable accounting standards and the weight of all available evidence, that it was MLTN that its deferred tax assets subject to the TRA would not be realized as of June 30, 2021. Therefore, the Company has not recorded a liability related to the tax savings it may realize from utilization of such deferred tax assets after concluding it was not probable that such TRA liability would be paid based on its estimates of future taxable income. As of June 30, 2021, the total unrecorded TRA liability is approximately $
10. Earnings (Loss) Per Share/Unit
Prior to the Reorganization Transactions that occurred on February 12, 2021, the Viant Technology LLC membership structure included certain convertible preferred units and common units. As a result of the Reorganization Transactions, Class B units of Viant Technology LLC are exchangeable in the future for Class A common stock of the Company. As the conversion of Viant Technology LLC preferred and common units to Class B units was not done in a proportionate manner with respect to the rights and economic interests of the former Viant Technology LLC unit holders compared to those of the new Class B unit/shareholders in Viant Technology LLC and Viant Technology Inc, we do not believe it is appropriate to retrospectively adjust these units. Accordingly, the earnings per unit calculation presented for the three and six months ended June 30, 2020 reflects units of the membership structure prior to the Reorganization Transactions.
For the three and six months ended June 30, 2021, basic net loss per share has been calculated by dividing net loss attributable to Class A common stockholders for the period subsequent to the Reorganization Transactions, by the weighted average number of shares of Class A common stock outstanding for the same period. Shares of Class A common stock are weighted for the portion of the period in which the shares were outstanding. Diluted net loss per share has been calculated in a manner consistent with that of basic net loss per share while considering all potentially dilutive shares of Class A common stock outstanding during the period.
For the three and six months ended June 30, 2020, basic earnings (loss) per unit represents net income (loss) divided by the weighted-average number of units outstanding. Diluted net income (loss) per share has been computed in a manner consistent with that of basic net loss per share while considering all shares of potentially dilutive common units that were outstanding during the period, inclusive of the convertible preferred units using the if-converted method and the incentive common units using the treasury stock method, if dilutive. For the three and six months ended June 30, 2020, there were no potential dilutive units related to incentive common units as they were all issued as of the beginning of the year.
The undistributed earnings for the three and six months ended June 30, 2020 have been allocated based on the participation rights of the convertible preferred and common units as if the earnings for the period have been distributed. As the participation in distributed and undistributed earnings is identical for both classes, the distributed and undistributed earnings are allocated on a proportionate basis.
19
The following table presents the calculation of basic and diluted net earnings (loss) per share/unit for the three and six months ended June 30, 2021, the period following the Reorganization Transactions, and for the three and six months ended June 30, 2020. See Note 2 for additional information related to basic and diluted net loss per share/unit.
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands, except per share/unit data) |
|
|
(in thousands, except per share/unit data) |
|
||||||||||
Numerator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Less: Net loss attributable to noncontrolling interests |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
Less: Undistributed earnings attributable to participating securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Net income (loss) attributable to Viant Technology Inc./common unitholders |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Denominator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares of Class A common stock/units outstanding—basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible preferred units |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
Weighted-average shares of Class A common stock/units outstanding—diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share of Class A common stock/unit—basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Earnings (loss) per share of Class A common stock/unit—diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anti-dilutive shares/units excluded from earnings (loss) per share of Class A common stock/unit—diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible preferred units |
|
|
— |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
Restricted stock units |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
Non-qualified stock options |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
Shares of Class B common stock |
|
|
|
|
|
|
— |
|
|
|
|
|
|
|
— |
|
Total shares excluded from earnings (loss) per share of Class A common stock/unit—diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
11. Noncontrolling Interests
We are the sole managing member of Viant Technology LLC and, as a result, consolidate the financial results of Viant Technology LLC. We report noncontrolling interests representing the economic interests in Viant Technology LLC held by the other members of Viant Technology LLC. The Viant Technology LLC Agreement classifies the interests acquired by the Company as Class A units, reclassified the interests held by the continuing members of Viant Technology LLC as Class B units and permits the
The following table summarizes the ownership of Viant Technology LLC:
|
|
As of June 30, 2021 |
|
|||||
Owner |
|
Units Owned |
|
|
Ownership Percentage |
|
||
Viant Technology Inc. |
|
|
|
|
|
|
|
% |
Noncontrolling interests |
|
|
|
|
|
|
|
% |
Total |
|
|
|
|
|
|
|
% |
20
12. Commitments and Contingencies
Lease Commitments
Future minimum payments under the Company’s non-cancelable operating leases, which are primarily related to office leases, as of June 30, 2021 are as follows:
|
|
As of June 30, 2021 |
|
|
Year |
|
(in thousands) |
|
|
Remainder of 2021 |
|
$ |
|
|
2022 |
|
|
|
|
2023 |
|
|
|
|
2024 |
|
|
|
|
2025 and thereafter |
|
|
|
|
Total minimum payments |
|
$ |
|
|
Legal Matters
From time to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course of business. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not believe that any of these proceedings or other claims will have a material effect on the Company’s business, financial condition, results of operations or cash flows.
Guarantees and Indemnities
The Company has made no significant contractual guarantees for the benefit of third parties. However, in the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company or intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with directors and certain officers and employees that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. The Company is not aware of indemnification claims that could have a material effect on the Company’s condensed consolidated financial statements. Accordingly,
13. Subsequent Events
On August 5, 2021, the Board of Directors approved the Company to purchase Class A common stock at fair value upon vesting of RSUs to satisfy minimum statutory tax obligations paid by the Company on behalf of plan participants.
On August 9, 2021,
21
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally relate to future events or our future financial or operating performance and may include statements concerning, among other things, our business strategy (including anticipated trends and developments in, and management plans for, our business and the markets in which we operate), financial results, the impact of COVID-19 on our business, operations, and the markets and communities in which we, our clients, and partners operate, results of operations, revenues, operating expenses, and capital expenditures, sales and marketing initiatives and competition. In some cases, you can identify forward-looking statements because they contain words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “suggests,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. These statements are not guarantees of future performance; they reflect our current views with respect to future events and are based on assumptions and are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from expectations or results projected or implied by forward-looking statements.
We discuss many of these risks in our Annual Report on Form 10-K for the year ended December 31, 2020 in greater detail under the heading “Risk Factors” and in other filings we make from time to time with the Securities and Exchange Commission, or SEC. Also, these forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report on Form 10-Q, which are inherently subject to change and involve risks and uncertainties. Unless required by federal securities laws, we assume no obligation to update any of these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated, to reflect circumstances or events that occur after the statements are made. Given these uncertainties, investors should not place undue reliance on these forward-looking statements.
Investors should read this Quarterly Report on Form 10-Q and the documents that we reference in this report and have filed with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2020, completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
References to “Notes” are notes included in our unaudited condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q.
Overview
We are an advertising software company. Our software enables the programmatic purchase of advertising, which is the electronification of the advertising buying process. Programmatic advertising is rapidly taking market share from traditional ad sales channels, which require more staffing, offer less transparency and involve higher costs to buyers.
Our DSP, Adelphic, is an enterprise software platform that is used by marketers and their advertising agencies to centralize the planning, buying and measurement of their advertising media across most channels. Through our technology, a marketer can easily buy ads on desktop, mobile, connected TV, linear TV, streaming audio and digital billboards.
We serve marketers and their advertising agencies by enabling them to plan, buy and measure programmatic campaigns. We provide an easy-to-use self-service programmatic platform that delivers transparency and control. Our platform offers customers unique visibility across a variety of advertising channels with the ability to create customized audience segments leveraging our people-based and strategic partner data to reach target audiences at scale. Our people-based approach is in contrast to the inefficient approach of cookie-based tracking. People-based data enables marketers to use first-party data for both the targeting and measurement of their ad campaigns in a manner that we believe is more accurate than utilizing a cookie-based approach.
We make our platform available through different pricing options to tailor to multiple client types and customer needs. These options consist of a percentage of spend option, a subscription option and a fixed CPM pricing option. CPM refers to a payment option in which customers pay a price for every 1,000 impressions an ad receives. Customers can enter into master service agreements with us that enable them to use our platform on a self-service basis to execute their advertising campaigns. We generate revenue when the platform is used on a self-service basis by charging a platform fee that is either a percentage of spend or a flat monthly subscription fee, as well as fees for additional features such as data and advanced reporting. We also offer our customers the ability to use our services to aid them in data management, media execution and advanced reporting. When customers utilize our services, we generate revenue by charging a (1) separate service fee that represents a percentage of spend in addition to the platform fee; (2) a flat monthly fee covering services in connection with data management and advanced reporting; or (3) a fixed CPM that is inclusive of media, other direct costs and services. We believe that offering a multitude of pricing options provides our customers greater flexibility and access to our platform.
22
Our financial results include:
|
• |
Revenue of $50.4 million and $30.4 million for the three months ended June 30, 2021 and 2020, respectively, representing an increase of 65.7%, and $90.6 million and $68.6 million for the six months ended June 30, 2021 and 2020, respectively, representing an increase of 32.0%; |
|
• |
Gross profit of $18.7 million and $11.8 million for the three months ended June 30, 2021 and 2020, respectively, representing an increase of 58.0%, and $34.5 million and $26.4 million for the six months ended June 30, 2021 and 2020, respectively, representing an increase of 30.7%; |
|
• |
Contribution ex-TAC of $32.2 million and $20.0 million for the three months ended June 30, 2021 and 2020, respectively, representing an increase of 60.6%, and $58.9 million and $43.3 million for the six months ended June 30, 2021 and 2020, respectively, representing an increase of 35.9%; |
|
• |
Net loss of $18.1 million and $0.03 million for the three months ended June 30, 2021 and 2020, respectively, and net loss of $33.0 million and net income $0.3 million for the six months ended June 30, 2021 and 2020, respectively; |
|
• |
Non-GAAP net income of $5.2 million and non-GAAP net loss of $0.03 million for the three months ended June 30, 2021 and 2020, respectively, and non-GAAP net income of $7.4 million and $0.3 million for the six months ended June 30, 2021 and 2020, respectively; and |
|
• |
Adjusted EBITDA of $8.3 million and $2.8 million for the three months ended June 30, 2021 and 2020, respectively, representing an increase of 203%, and $13.2 million and $6.0 million for the six months ended June 30, 2021 and 2020, respectively, representing an increase of 121%. |
Contribution ex-TAC, previously referred to as Revenue ex-TAC in our Annual Report on Form 10-K for the year ended December 31, 2020 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, Adjusted EBITDA, non-GAAP net income (loss), and non-GAAP earnings (loss) per share are non-GAAP measures. For a detailed discussion of our key operating and financial performance metrics and a reconciliation of contribution ex-TAC, Adjusted EBITDA, non-GAAP net income (loss), and non-GAAP earnings (loss) per share to the most directly comparable financial measures calculated in accordance with GAAP, see “—Key Operating and Financial Performance Metrics—Use of Non-GAAP Financial Measures.”
Factors Affecting Our Performance
COVID-19
In March 2020, the World Health Organization characterized COVID-19 a pandemic and the President of the United States declared the COVID-19 outbreak a national emergency. COVID-19 has spread across the globe and has impacted economic activity worldwide.
The ultimate impact of COVID-19 on the Company’s results of operations, financial condition and cash flows is dependent on future developments, including the duration of the pandemic and the related length of its impact on the global economy, which are uncertain and cannot be predicted at this time. See “Risk Factors”—The effects of the ongoing COVID-19 pandemic and other sustained adverse market events have had, and could in the future have, an adverse impact on our business, operating results and financial condition” in our Annual Report on Form 10-K for the year ended December 31, 2020 for further discussion of the potential impacts of the COVID-19 pandemic on our business.
Attract, Retain and Grow our Customer Base
Our recent growth has been driven by expanding the use of our platform by our existing customers as well as adding new customers. We believe that our customers value our solutions, as our average contribution ex-TAC per Active Customer for the twelve months ended June 30, 2021 was $438,000, an increase of $19,000, or 4.5%, compared to the twelve months ended December 31, 2020 and an increase of $49,000, or 12.6%, compared to twelve months ended June 30, 2020. The number of Active Customers for the twelve months ended June 30, 2021 was 288, increasing by 24 customers, or 9.1%, from the twelve months ended December 31, 2020 compared to the twelve months ended June 30, 2021 and increased by 28 customers, or 10.8%, from the twelve months ended June 30, 2020 to the twelve months ended June 30, 2021. We review changes in the use of our platform as represented by changes in aggregate spend on the platform as a metric of customer engagement. Platform spend increased by 58.4% during the three months ended June 30, 2021 compared to the three months ended June 30, 2020 and 31.8% during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. For a detailed discussion of our key operating metrics including the definition of Active Customers, see “—Key Operating and Financial Performance Metrics—Use of Non-GAAP Financial Measures.”
23
We continue to add functionality to our platform to encourage our customers to increase their usage of our platform. We believe many advertisers are in the early stages of moving a greater percentage of their advertising budgets to programmatic channels. By providing solutions for the planning, buying and measuring of their media spend across channels, we believe that we are well positioned to capture the increase in programmatic budgets. Further, we intend to continue to grow our sales and marketing efforts to increase awareness of our Adelphic platform and highlight the advantages of our people-based framework as cookie-based options become increasingly limited. As a result, future revenue growth depends upon our ability to retain our existing customers and increase their use of our platform as well as add new customers.
Investment in Growth
We believe that the advertising market is in the early stages of a secular shift towards programmatic advertising. We plan to invest for long-term growth. We anticipate that our operating expenses will increase significantly in the foreseeable future as we invest in platform operations and technology and development to enhance our product capabilities, including identity resolution and the integration of new advertising channels, and in sales and marketing to acquire new customers and increase our customers’ use of our platform. We believe that these investments will contribute to our long-term growth, although they may have a negative impact on our profitability in the near-term.
Growth of the Digital Advertising Market and Macroeconomics Factors
We expect to continue to benefit from overall adoption of programmatic advertising by marketers and their agencies. Any material change in the growth rate of digital advertising or the rate of adoption of programmatic advertising, including expansion of new programmatic channels, could affect our performance. Recent years have shown that advertising spend is closely tied to advertisers’ financial performance, and a downturn, either generally or in one or more of the industries in which our customers operate, could adversely impact the digital advertising market and our operating results.
Seasonality
In the advertising industry, companies commonly experience seasonal fluctuations in revenue. For example, many marketers allocate the largest portion of their budgets to the fourth quarter of the calendar year in order to coincide with increased holiday purchasing. Historically, the fourth quarter has reflected our highest level of advertising activity for the year. We generally expect the subsequent first quarter to reflect lower activity levels, but this trend may be masked due to the continued growth of our business. In addition, historical seasonality may not be predictive of future results given the potential for changes in advertising buying patterns and consumer activity due to the COVID-19 pandemic. We expect our revenue to continue to fluctuate based on seasonal factors that affect the advertising industry as a whole.
Results of Operations
The following tables set forth our consolidated results of operations, our consolidated results of operations as a percentage of revenue, and the impact of stock-based compensation, depreciation and amortization on each operating expense line item for the three and six months ended June 30, 2021 and 2020:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Consolidated Statements of Operations Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
50,411 |
|
|
$ |
30,425 |
|
|
$ |
90,555 |
|
|
$ |
68,585 |
|
Operating expenses(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
|
31,715 |
|
|
|
18,589 |
|
|
|
56,059 |
|
|
|
42,192 |
|
Sales and marketing |
|
|
20,553 |
|
|
|
5,742 |
|
|
|
34,738 |
|
|
|
12,872 |
|
Technology and development |
|
|
8,031 |
|
|
|
1,984 |
|
|
|
13,931 |
|
|
|
4,134 |
|
General and administrative |
|
|
14,075 |
|
|
|
3,891 |
|
|
|
24,495 |
|
|
|
8,547 |
|
Total operating expenses |
|
|
74,374 |
|
|
|
30,206 |
|
|
|
129,223 |
|
|
|
67,745 |
|
Income (loss) from operations |
|
|
(23,963 |
) |
|
|
219 |
|
|
|
(38,668 |
) |
|
|
840 |
|
Total other expense (income), net |
|
|
(5,868 |
) |
|
|
249 |
|
|
|
(5,702 |
) |
|
|
541 |
|
Net income (loss) |
|
|
(18,095 |
) |
|
|
(30 |
) |
|
|
(32,966 |
) |
|
|
299 |
|
Less: Net loss attributable to noncontrolling interests |
|
|
(14,440 |
) |
|
|
— |
|
|
|
(26,206 |
) |
|
|
— |
|
Net income (loss) attributable to Viant Technology Inc. |
|
$ |
(3,655 |
) |
|
$ |
(30 |
) |
|
$ |
(6,760 |
) |
|
$ |
299 |
|
24
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(% of revenue*) |
|
|
(% of revenue*) |
|
||||||||||
Consolidated Statements of Operations Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
100 |
% |
|
|
100 |
% |
|
|
100 |
% |
|
|
100 |
% |
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
|
63 |
% |
|
|
61 |
% |
|
|
62 |
% |
|
|
62 |
% |
Sales and marketing |
|
|
41 |
% |
|
|
19 |
% |
|
|
38 |
% |
|
|
19 |
% |
Technology and development |
|
|
16 |
% |
|
|
7 |
% |
|
|
15 |
% |
|
|
6 |
% |
General and administrative |
|
|
28 |
% |
|
|
13 |
% |
|
|
27 |
% |
|
|
12 |
% |
Total operating expenses |
|
|
148 |
% |
|
|
99 |
% |
|
|
143 |
% |
|
|
99 |
% |
Income (loss) from operations |
|
|
(48 |
)% |
|
|
1 |
% |
|
|
(43 |
)% |
|
|
1 |
% |
Total other expense (income), net |
|
|
(12 |
)% |
|
|
1 |
% |
|
|
(6 |
)% |
|
|
1 |
% |
Net income (loss) |
|
|
(36 |
)% |
|
|
0 |
% |
|
|
(36 |
)% |
|
|
0 |
% |
Less: Net loss attributable to noncontrolling interests |
|
|
(29 |
)% |
|
|
— |
|
|
|
(29 |
)% |
|
|
— |
|
Net income (loss) attributable to Viant Technology Inc. |
|
|
(7 |
)% |
|
|
(0 |
)% |
|
|
(7 |
)% |
|
|
0 |
% |
|
* |
Percentages may not sum due to rounding |
|
(1) |
Stock-based compensation, depreciation, and amortization included above were as follows: |
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Stock-based compensation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
$ |
5,540 |
|
|
$ |
— |
|
|
$ |
8,701 |
|
|
$ |
— |
|
Sales and marketing |
|
|
11,914 |
|
|
|
— |
|
|
|
18,727 |
|
|
|
— |
|
Technology and development |
|
|
5,029 |
|
|
|
— |
|
|
|
7,968 |
|
|
|
— |
|
General and administrative |
|
|
7,203 |
|
|
|
— |
|
|
|
11,381 |
|
|
|
— |
|
Total stock-based compensation |
|
$ |
29,686 |
|
|
$ |
— |
|
|
$ |
46,777 |
|
|
$ |
— |
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Depreciation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
$ |
1,766 |
|
|
$ |
1,678 |
|
|
$ |
3,344 |
|
|
$ |
3,440 |
|
Sales and marketing |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Technology and development |
|
|
383 |
|
|
|
402 |
|
|
|
763 |
|
|
|
803 |
|
General and administrative |
|
|
168 |
|
|
|
153 |
|
|
|
330 |
|
|
|
297 |
|
Total depreciation |
|
$ |
2,317 |
|
|
$ |
2,233 |
|
|
$ |
4,437 |
|
|
$ |
4,540 |
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform operations |
|
$ |
175 |
|
|
$ |
175 |
|
|
$ |
350 |
|
|
$ |
350 |
|
Sales and marketing |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Technology and development |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
General and administrative |
|
|
132 |
|
|
|
132 |
|
|
|
264 |
|
|
|
264 |
|
Total amortization |
|
$ |
307 |
|
|
$ |
307 |
|
|
$ |
614 |
|
|
$ |
614 |
|
Comparison of the Three Months Ended June 30, 2021 and 2020
Revenue
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Revenue |
|
$ |
50,411 |
|
|
$ |
30,425 |
|
|
$ |
19,986 |
|
|
|
66 |
% |
25
Revenue increased by $20.0 million, or 66%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. Despite ongoing adverse impacts of the COVID-19 pandemic, we have continued to experience increased customer usage of our platform, particularly in the percentage of spend pricing option, and continuing demand for our people-based advertising products and services. Platform spend increased by 58.4% in the comparative period.
Platform Operations
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Traffic acquisition costs |
|
$ |
18,212 |
|
|
$ |
10,380 |
|
|
$ |
7,832 |
|
|
|
75 |
% |
Other platform operations |
|
|
13,503 |
|
|
|
8,209 |
|
|
|
5,294 |
|
|
|
64 |
% |
Total platform operations |
|
$ |
31,715 |
|
|
$ |
18,589 |
|
|
$ |
13,126 |
|
|
|
71 |
% |
Platform operations as a percentage of revenue |
|
|
63 |
% |
|
|
61 |
% |
|
|
|
|
|
|
|
|
Platform operations expense increased by $13.1 million, or 71%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. This is comprised of a $7.8 million increase in traffic acquisition costs (“TAC”), which is a variable function of revenue associated with our fixed CPM pricing option and an increase of $5.3 million in other platform operations expense. The increase in other platform operations is primarily driven by a $5.5 million increase in stock-based compensation related to our 2021 LTIP and, a $0.1 million increase in depreciation, partially offset by a decrease of $0.3 million in cloud costs due to continued efforts to increase cloud infrastructure efficiencies.
Sales and Marketing
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Sales and marketing |
|
$ |
20,553 |
|
|
$ |
5,742 |
|
|
$ |
14,811 |
|
|
|
258 |
% |
Percentage of revenue |
|
|
41 |
% |
|
|
19 |
% |
|
|
|
|
|
|
|
|
Sales and marketing expense increased by $14.8 million, or 258%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. The increase in sales and marketing expense was primarily due to a $11.9 million increase in stock-based compensation related to our 2021 LTIP, a $2.5 million increase in personnel costs and overhead allocated to sales and marketing as a result of the departments’ headcount increasing and becoming a larger percentage of total headcount, a $0.2 increase in travel and entertainment, a $0.1 increase in software licenses and subscriptions, and a $0.1 increase in advertising.
Technology and Development
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Technology and development |
|
$ |
8,031 |
|
|
$ |
1,984 |
|
|
$ |
6,047 |
|
|
|
305 |
% |
Percentage of revenue |
|
|
16 |
% |
|
|
7 |
% |
|
|
|
|
|
|
|
|
26
Technology and development expense increased by $6.0 million, or 305%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. The increase in technology and development expense was primarily attributable to a $5.0 million increase in stock-based compensation related to our 2021 LTIP and a $1.0 million increase in personnel and overhead cost allocation as a result of an increase in headcount to support our continued investment in developed technology.
General and Administrative
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
General and administrative |
|
$ |
14,075 |
|
|
$ |
3,891 |
|
|
$ |
10,184 |
|
|
|
262 |
% |
Percentage of revenue |
|
|
28 |
% |
|
|
13 |
% |
|
|
|
|
|
|
|
|
General and administrative expense increased by $10.2 million, or 262%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. The increase in general and administrative expense was primarily attributable to a $7.2 million increase in stock-based compensation related to our 2021 LTIP, a $1.4 million increase in insurance and legal expenses associated with being a publicly traded company, a $1.1 million increase in personnel costs due to the increase in headcount and a $0.5 million increase in recruiting expenses, partially offset by a $0.2 decrease in professional fees due to prior year expense relating to preparation for the IPO.
Total Other Expense (Income), Net
|
|
Three Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Total other expense (income), net |
|
$ |
(5,868 |
) |
|
$ |
249 |
|
|
$ |
(6,117 |
) |
|
|
(2457 |
%) |
Percentage of revenue |
|
|
(12 |
%) |
|
|
1 |
% |
|
|
|
|
|
|
|
|
Total other expense (income), net decreased by $6.1 million, or 2,457%, during the three months ended June 30, 2021 compared to the three months ended June 30, 2020. The decrease in total other expense (income), net was primarily due to a $6.1 million gain on debt extinguishment as a result of the forgiveness of the Company’s PPP Loan and related accrued interest. For additional information regarding forgiveness of the Company’s PPP Loan, see Note 7—Long-Term Debt and Revolving Credit Facility to our condensed consolidated financial statements.
Comparison of the Six Months Ended June 30, 2021 and 2020
Revenue
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Revenue |
|
$ |
90,555 |
|
|
$ |
68,585 |
|
|
$ |
21,970 |
|
|
|
32 |
% |
Revenue increased by $22.0 million, or 32%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. Despite ongoing adverse impacts of the COVID-19 pandemic, we have continued to experience increased customer
27
usage of our platform, particularly in the percentage of spend pricing option, and continuing demand for our people-based advertising products and services. Platform spend increased by 31.8% in the comparative period.
Platform Operations
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Traffic acquisition costs |
|
$ |
31,615 |
|
|
$ |
25,199 |
|
|
$ |
6,416 |
|
|
|
25 |
% |
Other platform operations |
|
|
24,444 |
|
|
|
16,993 |
|
|
|
7,451 |
|
|
|
44 |
% |
Total platform operations |
|
$ |
56,059 |
|
|
$ |
42,192 |
|
|
$ |
13,867 |
|
|
|
33 |
% |
Platform operations as a percentage of revenue |
|
|
62 |
% |
|
|
62 |
% |
|
|
|
|
|
|
|
|
Platform operations expense increased by $13.9 million, or 33%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The increase in platform operations is primarily driven by a $8.7 million increase in stock-based compensation related to our 2021 LTIP and a $6.4 million increase in TAC, which is a variable function of revenue associated with our fixed CPM pricing option, partially offset by a decrease of $0.9 million in cloud costs due to continued efforts to increase cloud infrastructure efficiencies and a decrease of $0.1 million in depreciation.
Sales and Marketing
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Sales and marketing |
|
$ |
34,738 |
|
|
$ |
12,872 |
|
|
$ |
21,866 |
|
|
|
170 |
% |
Percentage of revenue |
|
|
38 |
% |
|
|
19 |
% |
|
|
|
|
|
|
|
|
Sales and marketing expense increased by $21.9 million, or 170%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The increase in sales and marketing expense was primarily due to a $18.7 million increase in stock-based compensation related to our 2021 LTIP, a $2.9 million increase personnel costs and in the amount of overhead allocated to sales and marketing as a result of the departments’ headcount increasing and becoming a larger percentage of total headcount, a $0.3 increase in advertising and a $0.1 increase in software licenses and subscriptions, partially offset by a $0.2 million decrease in travel and entertainment as a result of the COVID-19 pandemic.
Technology and Development
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Technology and development |
|
$ |
13,931 |
|
|
$ |
4,134 |
|
|
$ |
9,797 |
|
|
|
237 |
% |
Percentage of revenue |
|
|
15 |
% |
|
|
6 |
% |
|
|
|
|
|
|
|
|
Technology and development expense increased by $9.8 million, or 237%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The increase in technology and development expense was primarily attributable to a $8.0 million increase in stock-based compensation related to our 2021 LTIP and an $1.8 million increase in personnel costs as a result of an increase in headcount to support our continued investment in developed technology.
General and Administrative
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
General and administrative |
|
$ |
24,495 |
|
|
$ |
8,547 |
|
|
$ |
15,948 |
|
|
|
187 |
% |
Percentage of revenue |
|
|
27 |
% |
|
|
12 |
% |
|
|
|
|
|
|
|
|
28
General and administrative expense increased by $15.9 million, or 187%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The increase in general and administrative expense was primarily attributable to a $11.4 million increase in stock-based compensation related to our 2021 LTIP, a $2.0 million increase in insurance and accounting expenses associated with the IPO, a $1.6 million increase in personnel costs due to the increase in headcount, a $0.8 million increase in recruiting expenses and a $0.2 million increase in software and subscription license expenses, partially offset by a $0.2 decrease in travel and entertainment due to the COVID-19 pandemic.
Total Other Expense (Income), Net
|
|
Six Months Ended June 30, |
|
|
Change |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands, except for percentages) |
|
|||||||||||||
Total other expense (income), net |
|
$ |
(5,702 |
) |
|
$ |
541 |
|
|
$ |
(6,243 |
) |
|
|
(1154 |
%) |
Percentage of revenue |
|
|
(6 |
%) |
|
|
1 |
% |
|
|
|
|
|
|
|
|
Total other expense (income), net increased by $6.2 million, or 1,154%, during the six months ended June 30, 2021 compared to the six months ended June 30, 2020. The increase in total other expense (income), net was primarily due to a $6.1 million gain on debt extinguishment as a result of the forgiveness of Company’s PPP Loan and related accrued interest. For additional information regarding forgiveness of the Company’s PPP Loan, see Note 7—Long-Term Debt and Revolving Credit Facility to our condensed consolidated financial statements.
Key Operating and Financial Performance Metrics
Use of Non-GAAP Financial Measures
We monitor the key operating and financial performance metrics set forth below to help us evaluate growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts and assess our operational efficiencies. This Quarterly Report includes financial measures defined as non-GAAP financial measures by the SEC. These non-GAAP measures include contribution ex-TAC, Adjusted EBITDA, non-GAAP net income (loss), and non-GAAP earnings (loss) per share, which are discussed immediately following the table below, along with the operational performance measure Active Customers. These measures are not calculated in accordance with GAAP.
|
|
Three Months Ended June 30, |
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
|
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
Change (%) |
|
|
2021 |
|
|
2020 |
|
|
Change (%) |
|
||||||
|
|
(in thousands, except for percentages, per share data and number of customers) |
|
|
|
|
|
|
(in thousands, except for percentages, per share data and number of customers) |
|
|
|
|
|
||||||||||
Operating and Financial Performance Metrics |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution ex-TAC |
|
$ |
32,199 |
|
|
$ |
20,045 |
|
|
|
61 |
% |
|
$ |
58,940 |
|
|
$ |
43,386 |
|
|
|
36 |
% |
Adjusted EBITDA |
|
$ |
8,346 |
|
|
$ |
2,754 |
|
|
|
203 |
% |
|
$ |
13,228 |
|
|
$ |
5,978 |
|
|
|
121 |
% |
Adjusted EBITDA as a percentage of contribution ex-TAC |
|
|
26 |
% |
|
|
14 |
% |
|
|
|
|
|
|
22 |
% |
|
|
14 |
% |
|
|
|
|
Non-GAAP net income (loss) (1) |
|
$ |
5,231 |
|
|
$ |
(30 |
) |
|
N/M |
|
|
$ |
7,385 |
|
|
$ |
299 |
|
|
|
2370 |
% |
|
Non-GAAP earnings (loss) per share—basic(2) |
|
$ |
0.07 |
|
|
N/A |
|
|
N/A |
|
|
$ |
0.09 |
|
|
N/A |
|
|
N/A |
|
||||
Non-GAAP earnings (loss) per share—diluted(2) |
|
$ |
0.06 |
|
|
N/A |
|
|
N/A |
|
|
$ |
0.08 |
|
|
N/A |
|
|
N/A |
|
||||
Number of Active Customers(3) |
|
|
288 |
|
|
|
260 |
|
|
|
11 |
% |
|
|
288 |
|
|
|
260 |
|
|
|
11 |
% |
Average contribution ex-TAC per Active Customer(3) |
|
$ |
438 |
|
|
$ |
389 |
|
|
|
13 |
% |
|
$ |
438 |
|
|
$ |
389 |
|
|
|
13 |
% |
(1)Management believes that the change in non-GAAP net income (loss) for the three months ended June 30, 2021, compared to the same period in the prior year, is not meaningful as the change is comparing a period of net income to a period of net loss.
29
(2)Non-GAAP earnings (loss) per share was not adjusted for the prior comparative periods presented. For discussion on why prior periods were not adjusted, see “—Non-GAAP Earnings (loss) per Share.”
(3)We define an Active Customer as a customer that had total aggregate contribution ex-TAC of at least $5,000 through our platform during the previous twelve months. We define average contribution ex-TAC per Active Customer as contribution ex-TAC for the trailing twelve month period presented divided by Active Customers. For a detailed discussion of average contribution ex-TAC per Active Customer and Active Customers, see “—Number of Active Customers and Average Contribution ex-TAC per Active Customer.”
Contribution ex-TAC
Contribution ex-TAC, previously referred to as Revenue ex-TAC in our Annual Report on Form 10-K for the year ended December 31, 2020 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, is a non-GAAP financial measure. Gross profit is the most comparable GAAP measurement, which is calculated as revenue less platform operations. In calculating contribution ex-TAC, we add back other platform operations expense to gross profit. Contribution ex-TAC is a key profitability measure used by our management and board of directors to understand and evaluate our operating performance and trends, develop short-and long-term operational plans and make strategic decisions regarding the allocation of capital. In particular, we believe that contribution ex-TAC can provide a measure of period-to-period comparisons for all pricing options within our business. Accordingly, we believe that this measure provides information to investors and the market in understanding and evaluating our operating results in the same manner as our management and board of directors.
Our use of contribution ex-TAC has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. A potential limitation of this non-GAAP financial measure is that other companies, including companies in our industry that have similar business arrangements, may define contribution ex-TAC differently, which may make comparisons difficult. Because of these and other limitations, you should consider our non-GAAP measures only as supplemental to other GAAP-based financial performance measures, including revenue, gross profit, net income (loss) and cash flows.
The following table presents the calculation of gross profit and reconciliation of gross profit to contribution ex-TAC for the three and six months ended June 30, 2021 and 2020:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Revenue |
|
$ |
50,411 |
|
|
$ |
30,425 |
|
|
$ |
90,555 |
|
|
$ |
68,585 |
|
Less: Platform operations |
|
|
(31,715 |
) |
|
|
(18,589 |
) |
|
|
(56,059 |
) |
|
|
(42,192 |
) |
Gross profit |
|
|
18,696 |
|
|
|
11,836 |
|
|
|
34,496 |
|
|
|
26,393 |
|
Add back: Other platform operations |
|
|
13,503 |
|
|
|
8,209 |
|
|
|
24,444 |
|
|
|
16,993 |
|
Contribution ex-TAC |
|
$ |
32,199 |
|
|
$ |
20,045 |
|
|
$ |
58,940 |
|
|
$ |
43,386 |
|
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure defined by us as net income (loss), the most comparable GAAP measurement, before interest expense, net, income tax expense (benefit), depreciation, amortization, stock-based compensation and certain other items that are not related to our core operations, such as restructuring charges, transaction expenses and the extinguishment of debt.
Adjusted EBITDA and Adjusted EBITDA as a percentage of contribution ex-TAC are key measures used by our management and board of directors 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 the exclusion of the amounts eliminated in calculating Adjusted EBITDA can provide a measure for period-to-period comparisons of our business. Adjusted EBITDA as a percentage of our non-GAAP metric, contribution ex-TAC, is used by our management and board of directors to evaluate Adjusted EBITDA relative to our profitability after costs that are directly variable to revenues, which comprise traffic acquisition costs. Accordingly, we believe that Adjusted EBITDA and Adjusted EBITDA as a percentage of contribution ex-TAC provide information to investors and the market in understanding and evaluating our operating results in the same manner as our management and board of directors.
30
Our use of Adjusted EBITDA and Adjusted EBITDA as a percentage of contribution ex-TAC has limitations as an analytical tool, and you should not consider these measures in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these potential limitations include:
|
• |
other companies, including companies in our industry that have similar business arrangements, may report Adjusted EBITDA or Adjusted EBITDA as a percentage of contribution ex-TAC, or similarly titled measures but calculate them differently, which reduces their usefulness as comparative measures; and |
|
• |
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; and |
|
• |
Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs or the potentially dilutive impact of stock-based compensation. |
Because of these and other limitations, you should consider our non-GAAP measures only as supplemental to other GAAP-based financial performance measures, including revenue, net income (loss) and cash flows. The following table presents the reconciliation of net income (loss) to Adjusted EBITDA for the three and six months ended June 30, 2021 and 2020.
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Net income (loss) |
|
$ |
(18,095 |
) |
|
$ |
(30 |
) |
|
$ |
(32,966 |
) |
|
$ |
299 |
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
241 |
|
|
|
244 |
|
|
|
476 |
|
|
|
525 |
|
Depreciation and amortization |
|
|
2,624 |
|
|
|
2,540 |
|
|
|
5,051 |
|
|
|
5,154 |
|
Stock-based compensation |
|
|
29,686 |
|
|
|
— |
|
|
|
46,777 |
|
|
|
— |
|
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on extinguishment of debt |
|
|
(6,110 |
) |
|
|
— |
|
|
|
(6,110 |
) |
|
|
— |
|
Adjusted EBITDA |
|
$ |
8,346 |
|
|
$ |
2,754 |
|
|
$ |
13,228 |
|
|
$ |
5,978 |
|
The following table presents the reconciliation of net income (loss) as a percentage of gross profit to Adjusted EBITDA as a percentage of contribution ex-TAC for the three and six months ended June 30, 2021 and 2020:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands, except for percentages) |
|
|
(in thousands, except for percentages) |
|
||||||||||
Gross profit |
|
$ |
18,696 |
|
|
$ |
11,836 |
|
|
$ |
34,496 |
|
|
$ |
26,393 |
|
Net income (loss) |
|
$ |
(18,095 |
) |
|
$ |
(30 |
) |
|
$ |
(32,966 |
) |
|
$ |
299 |
|
Net income (loss) as a percentage of gross profit(1) |
|
N/M |
|
|
|
(0 |
)% |
|
N/M |
|
|
|
1 |
% |
||
Contribution ex-TAC(2) |
|
$ |
32,199 |
|
|
$ |
20,045 |
|
|
$ |
58,940 |
|
|
$ |
43,386 |
|
Adjusted EBITDA(3) |
|
$ |
8,346 |
|
|
$ |
2,754 |
|
|
$ |
13,228 |
|
|
$ |
5,978 |
|
Adjusted EBITDA as a percentage of contribution ex-TAC |
|
|
26 |
% |
|
|
14 |
% |
|
|
22 |
% |
|
|
14 |
% |
(1)Management believes that net loss as a percentage of gross profit for the current period presented is not comparable to the prior year period presented due to the impact of stock-based compensation recognized in the current period.
(2)For a reconciliation of contribution ex-TAC to the most directly comparable financial measure calculated in accordance with GAAP, see “—Contribution ex-TAC.”
(3)For a reconciliation of Adjusted EBITDA to the most directly comparable financial measure calculated in accordance with GAAP, see “—Adjusted EBITDA.”
Non-GAAP Net Income (Loss)
Non-GAAP net income (loss) is a non-GAAP financial measure defined by us as net income (loss), the most comparable GAAP measurement, adjusted to eliminate the impact of stock-based compensation and certain other items that are not related to our core operations, such as restructuring charges, transaction expenses and the extinguishment of debt. Non-GAAP net income (loss) is a key
31
measure used by our management and board of directors to evaluate operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe that the elimination of stock-based compensation, gain on debt extinguishment, and certain other items that are not related to our core operations provides measures for period-to-period comparisons of our business and provides additional insight into our core controllable costs. Accordingly, we believe that non-GAAP net income (loss) provides information to investors and the market generally in understanding and evaluating our results of operations in the same manner as our management and board of directors.
Our use of non-GAAP net income (loss) has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. A potential limitation of this non-GAAP financial measure is that other companies, including companies in our industry that have similar business arrangements, may define non-GAAP net income (loss) differently, which may make comparisons difficult. Because of these and other limitations, you should consider our non-GAAP measures only as supplemental to other GAAP-based financial performance measures, including revenue, gross profit, net income (loss) and cash flows.
The following table presents the reconciliation of net income (loss) to non-GAAP net income for the three and six months ended June 30, 2021 and 2020:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
(in thousands) |
|
|
(in thousands) |
|
||||||||||
Net income (loss) |
|
$ |
(18,095 |
) |
|
$ |
(30 |
) |
|
$ |
(32,966 |
) |
|
$ |
299 |
|
Add back: Stock-based compensation |
|
|
29,686 |
|
|
|
— |
|
|
|
46,777 |
|
|
|
— |
|
Less: Gain on extinguishment of debt |
|
|
(6,110 |
) |
|
|
— |
|
|
|
(6,110 |
) |
|
|
— |
|
Less: Income tax effect related to Viant Technology Inc.'s share of adjustments |
|
|
(250 |
) |
|
|
— |
|
|
|
(316 |
) |
|
|
— |
|
Non-GAAP net income (loss) |
|
$ |
5,231 |
|
|
$ |
(30 |
) |
|
$ |
7,385 |
|
|
$ |
299 |
|
Non-GAAP Earnings (loss) per Share
Non-GAAP earnings (loss) per share is a non-GAAP financial measure defined by us as earnings (loss) per share, the most comparable GAAP measurement, adjusted to eliminate the impact of stock-based compensation and certain other items that are not related to our core operations, such as restructuring charges, transaction expenses and the extinguishment of debt. Non-GAAP earnings (loss) per share is a key measure used by our management and board of directors to evaluate operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe that the elimination of stock-based compensation, gain on extinguishment of debt and certain other items that are not related to our core operations provides measures for period-to-period comparisons of our business and provides additional insight into our core controllable costs. Accordingly, we believe that non-GAAP earnings (loss) per share provides information to investors and the market generally in understanding and evaluating our results of operations in the same manner as our management and board of directors.
Our use of Non-GAAP earnings (loss) per share has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these potential limitations include:
|
• |
other companies, including companies in our industry that have similar business arrangements, may report non-GAAP earnings (loss) per share or similarly titled measures, but calculate them differently, which reduces their usefulness as comparative measures; and |
|
• |
although the stock-based compensation related to the 2021 LTIP referred to above is non-cash in nature, non-GAAP earnings (loss) per share does not reflect its impact on net income (loss) attributable to all common shareholders. |
|
• |
although the gain on debt extinguishment related to the forgiveness of our PPP Loan and related accrued interest is non-cash in nature, non-GAAP earnings (loss) per share does not reflect its impact on net income (loss) attributable to all common shareholders. |
Because of these and other limitations, you should consider our non-GAAP measures only as supplemental to other GAAP-based financial performance measures, including earnings (loss) per share.
Basic non-GAAP earnings (loss) per share is calculated by dividing the non-GAAP net income (loss) attributable to Class A common stockholders by the number of weighted-average shares of Class A common stock outstanding. Shares of our Class B common stock do not share in the earnings or losses of the Company and are therefore not participating securities. As such, separate
32
presentation of basic and diluted non-GAAP earnings (loss) per share of Class B common stock under the two-class method has not been presented.
Diluted non-GAAP earnings (loss) per share adjusts the basic non-GAAP earnings (loss) per share calculation for the potential dilutive impact of common shares such as equity awards using the treasury-stock method. Diluted earnings (loss) per share considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares would have an anti-dilutive effect. Shares of our Class B common stock, RSUs and nonqualified stock options are considered potentially dilutive shares of Class A common stock. For the three and six months ended June 30, 2021, Class B common stock and nonqualified stock options amounts have been excluded from the computation of diluted earnings (loss) per share of Class A common stock because the effect would have been anti-dilutive under the if-converted and treasury stock method, respectively.
The following table presents the reconciliation of earnings (loss) per share to non-GAAP earnings (loss) per share for the three and six months ended June 30, 2021. Earnings (loss) per share was not adjusted for any other periods presented as there was no stock-based compensation or gain on debt extinguishment in those periods.
33
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||||||||||
|
|
June 30, 2021 |
|
|
June 30, 2021 |
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
Non-GAAP |
|
||
|
|
(Loss) per |
|
|
|
|
|
|
Earnings |
|
|
(Loss) per |
|
|
|
|
|
|
Earnings |
|
||||
|
|
Share |
|
|
Adjustments |
|
|
per Share |
|
|
Share |
|
|
Adjustments |
|
|
per Share |
|
||||||
|
|
(in thousands, except per share data) |
|
|||||||||||||||||||||
Numerator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(18,095 |
) |
|
$ |
— |
|
|
$ |
(18,095 |
) |
|
$ |
(32,966 |
) |
|
$ |
— |
|
|
$ |
(32,966 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add back: Stock-based compensation |
|
|
— |
|
|
|
29,686 |
|
|
|
29,686 |
|
|
|
— |
|
|
|
46,777 |
|
|
|
46,777 |
|
Less: Gain on extinguishment of debt |
|
|
— |
|
|
|
(6,110 |
) |
|
|
(6,110 |
) |
|
|
— |
|
|
|
(6,110 |
) |
|
|
(6,110 |
) |
Less: Income tax effect related to Viant Technology Inc.'s share of adjustments (1) |
|
|
— |
|
|
|
(250 |
) |
|
|
(250 |
) |
|
|
— |
|
|
|
(316 |
) |
|
|
(316 |
) |
Non-GAAP net income (loss) |
|
|
(18,095 |
) |
|
|
23,326 |
|
|
|
5,231 |
|
|
|
(32,966 |
) |
|
|
40,351 |
|
|
|
7,385 |
|
Less: Net income (loss) attributable to noncontrolling interests (2) |
|
|
(14,440 |
) |
|
|
18,899 |
|
|
|
4,459 |
|
|
|
(26,206 |
) |
|
|
32,612 |
|
|
|
6,406 |
|
Net income (loss) attributable to Viant Technology, Inc.—basic |
|
|
(3,655 |
) |
|
|
4,427 |
|
|
|
772 |
|
|
|
(6,760 |
) |
|
|
7,739 |
|
|
|
979 |
|
Add back: Reallocation of net loss attributable to noncontrolling interest from the assumed exchange of RSUs for Class A common stock |
|
|
— |
|
|
|
178 |
|
|
|
178 |
|
|
|
— |
|
|
|
250 |
|
|
|
250 |
|
Less: Income tax effect from the assumed exchange of RSUs for Class A common stock(1) |
|
|
— |
|
|
|
(43 |
) |
|
|
(43 |
) |
|
|
— |
|
|
|
(61 |
) |
|
|
(61 |
) |
Net income (loss) attributable to Viant Technology, Inc.—diluted |
|
$ |
(3,655 |
) |
|
$ |
4,562 |
|
|
$ |
907 |
|
|
$ |
(6,760 |
) |
|
$ |
7,928 |
|
|
$ |
1,168 |
|
Denominator |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares of Class A common stock outstanding—basic |
|
|
11,500 |
|
|
|
— |
|
|
|
11,500 |
|
|
|
11,500 |
|
|
|
— |
|
|
|
11,500 |
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSUs |
|
|
— |
|
|
|
2,521 |
|
|
|
2,521 |
|
|
|
— |
|
|
|
2,919 |
|
|
|
2,919 |
|
Weighted-average shares of Class A common stock outstanding—diluted |
|
|
11,500 |
|
|
|
2,521 |
|
|
|
14,021 |
|
|
|
11,500 |
|
|
|
2,919 |
|
|
|
14,419 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share of Class A common stock—basic |
|
$ |
(0.32 |
) |
|
$ |
0.39 |
|
|
$ |
0.07 |
|
|
$ |
(0.59 |
) |
|
$ |
0.68 |
|
|
$ |
0.09 |
|
Earnings (loss) per share of Class A common stock—diluted |
|
$ |
(0.32 |
) |
|
$ |
0.38 |
|
|
$ |
0.06 |
|
|
$ |
(0.59 |
) |
|
$ |
0.67 |
|
|
$ |
0.08 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anti-dilutive shares/units excluded from earnings (loss) per share of Class A common stock/unit—diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-qualified stock options |
|
|
|
|
|
|
|
|
|
|
67 |
|
|
|
|
|
|
|
|
|
|
|
67 |
|
Shares of Class B common stock |
|
|
|
|
|
|
|
|
|
|
47,436 |
|
|
|
|
|
|
|
|
|
|
|
47,436 |
|
Total shares excluded from earnings (loss) per share of Class A common stock/unit—diluted |
|
|
|
|
|
|
|
|
|
|
47,503 |
|
|
|
|
|
|
|
|
|
|
|
47,503 |
|
|
(1) |
The estimated income tax effect of the Company’s share of non-GAAP reconciling items are calculated using an assumed blended tax rate of 24%, which represents our expected corporate tax rate, excluding discrete and non-recurring tax items. |
|
(2) |
The adjustment to net income (loss) attributable to noncontrolling interests represents stock-based compensation and gain on extinguishment of debt attributed to the noncontrolling interests of the Company outstanding during the period. |
Management identified an immaterial calculation error in our basic and diluted non-GAAP earnings (loss) per share for the three months ended March 31, 2021. The correct basic and diluted non-GAAP earnings (loss) per share amounts are $0.02, for the three months ending March 31, 2021, rather than $0.01, the amounts previously reported in our Quarterly Report on Form 10-Q for the three months ended March 31, 2021.
34
Number of Active Customers and Average Contribution ex-TAC per Active Customer
Number of Active Customers and average contribution ex-TAC per Active Customer are operational metrics. We define an Active Customer as a customer that had total aggregate contribution ex-TAC of at least $5,000 through our platform during the previous twelve months. We define average contribution ex-TAC per Active Customer as contribution ex-TAC for the trailing twelve month period presented divided by Active Customers. For purposes of this definition, a customer that operates under any of our pricing options that equals or exceeds the aforementioned contribution ex-TAC threshold is considered an Active Customer. We believe that the total number of Active Customers and average contribution ex-TAC per Active Customer are important measures of our ability to increase revenue and the effectiveness of our sales force, although we expect these measures to fluctuate based on the seasonality in our business. Customers that generated less than $5,000 in contribution ex-TAC in the trailing twelve month period were not material in the aggregate in any period.
Liquidity and Capital Resources
As of June 30, 2021, we had cash of $252.3 million and working capital, consisting of current assets less current liabilities, of $264.4 million. We believe our existing cash, cash flow from operations, and undrawn availability under our credit facility will be sufficient to meet our working capital requirements for at least the next 12 months.
The Company is a holding company with no operations of its own and is dependent on distributions from Viant Technology LLC, including payments under the Tax Receivable Agreement, to pay its taxes and other expenses. The Loan Agreement, as defined below, imposes, and any future credit facilities may impose, limitations on the ability of Viant Technology LLC or the Company to pay dividends to third parties.
For additional information regarding our revolving credit facility, see Note 7—Long-Term Debt and Revolving Credit Facility to our condensed consolidated financial statements.
Cash Flows
The following table summarizes our cash flows for the six months ended June 30, 2021 and 2020:
|
|
Six Months Ended June 30, |
|
|||||
|
|
2021 |
|
|
2020 |
|
||
|
|
(in thousands) |
|
|||||
Consolidated Statements of Cash Flows Data |
|
|
|
|
|
|
|
|
Cash flows provided by operating activities |
|
$ |
23,571 |
|
|
$ |
11,543 |
|
Cash flows used in investing activities |
|
|
(4,016 |
) |
|
|
(3,837 |
) |
Cash flows provided by financing activities |
|
|
223,087 |
|
|
|
6,035 |
|
Increase in cash |
|
$ |
242,642 |
|
|
$ |
13,741 |
|
Operating Activities
Our cash flows from operating activities are primarily influenced by growth in our operations, increases or decreases in collections from our customers and related payments to our suppliers of advertising media and data. Cash flows from operating activities have been affected by changes in our working capital, particularly changes in accounts receivable, accounts payable and accrued liabilities. The timing of cash receipts from customers and payments to suppliers can significantly impact our cash flows from operating activities. We typically pay suppliers in advance of collections from our customers. Our collection and payment cycles can vary from period to period. In addition, we expect seasonality to impact cash flows from operating activities on a quarterly basis.
During the six months ended June 30, 2021, cash provided by operating activities of $23.6 million resulted primarily from a net loss of $33.0 million offset by noncash add back adjustments to net loss of $46.8 million for stock-based compensation, $5.1 million for depreciation and amortization, $0.2 million in recovery of doubtful accounts and an increase in net working capital (excluding deferred revenue and other liabilities) of $12.6 million, a decrease in deferred revenue of $1.1 million and a decrease in other liabilities of $0.5 million.
During the six months ended June 30, 2020, cash provided by operating activities of $11.5 million resulted primarily from net income of $0.3 million, noncash add back adjustments to net income of $5.2 million for depreciation and amortization and an increase in net working capital (excluding deferred revenue and other liabilities) of $8.4 million, offset by a decrease in deferred revenue of $1.0 million and a decrease in other liabilities of $1.2 million.
35
Investing Activities
Our primary investing activities have consisted of capital expenditures to develop our software in support of enhancing our technology platform and purchases of property and equipment in support of our expanding headcount as a result of our growth. We capitalize certain costs associated with creating and enhancing internally developed software related to our technology infrastructure that are recorded within property, equipment and software, net. These costs include personnel and related employee benefit expenses for employees who are directly associated with and who devote time to software development projects. Purchases of property and equipment and capitalized software development costs may vary from period-to-period due to the timing of the expansion of our operations, the addition of headcount and our software development cycles. As a result of the anticipated growth of our business in future periods, we expect our capital expenditures and our investment activity to continue to increase.
During the six months ended June 30, 2021 and 2020, cash used in investing activities of $4.0 million and $3.8 million, respectively, resulted primarily from investments in capitalized software development costs.
Financing Activities
Our financing activities consisted primarily of proceeds from issuances of our equity in connection with our IPO, partially offset by payments of offering costs associated with the issuances of equity and payments of member tax distributions. Net cash provided by or used in financing activities has been and will be used to finance our operations, capital expenditures, platform development and rapid growth.
During the six months ended June 30, 2021, cash provided by financing activities of $223.1 million resulted primarily from $232.5 million of IPO proceeds, net of underwriting discounts, partially offset by payments of $2.6 million in offering costs and $6.8 million in payments of member tax distributions.
During the six months ended June 30, 2020, cash provided by financing activities of $6.0 million resulted from proceeds through the Company’s PPP Loan.
Off-Balance Sheet Arrangements
We do not have any relationships with other entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. We did not have any other off-balance sheet arrangements as of June 30, 2021 other than operating leases and the indemnification agreements described in Note 12 to our condensed consolidated financial statements.
Contractual Obligations
Our principal commitments consist of our debt obligations and non-cancelable leases for our various office facilities. In certain cases, the terms of the lease agreements provide for rental payments on a graduated basis.
We have made no significant contractual guarantees for the benefit of third parties. However, in the ordinary course of business, we may provide indemnifications of varying scope and terms to customers, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by us or from intellectual property infringement claims made by third parties. In addition, we have entered into indemnification agreements with directors and certain officers and employees that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. No demands have been made upon us to provide indemnification under such agreements and thus, there are no claims that we are aware of that could have a material effect on our condensed consolidated financial statements. Accordingly, no amounts for any obligation have been recorded as of June 30, 2021.
Critical Accounting Policies and Estimates
Our condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.
An accounting policy is deemed to be critical if it requires an accounting estimate to be made on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably could have been used, or if changes in the
36
estimate that are reasonably possible could materially impact the financial statements. We believe that the assumptions and estimates associated with the evaluation of revenue recognition criteria, stock-based compensation, income taxes, allowances for doubtful accounts, the useful lives of capitalized software development costs and other property, equipment and software, assumptions used in the impairment analyses of long-lived assets and goodwill, deferred revenue, accrued liabilities and assumptions used in the fair valuation of equity-based payment arrangements have the greatest potential impact on our condensed consolidated financial statements. Therefore, we consider these to be our critical accounting policies and estimates.
The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period.
For additional information regarding stock-based compensation, income taxes and tax receivable agreement, see Note 2—Basis of Presentation and Summary of Significant Accounting Policies to our condensed consolidated financial statements.
Recently Issued Accounting Pronouncements
For information regarding recently issued accounting pronouncements, see Note 2—Basis of Presentation and Summary of Significant Accounting Policies to our condensed consolidated financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
See “Item 7A: Quantitative and Qualitative Disclosures About Market Risk” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. During the six months ended June 30, 2021, there have been no material changes in our exposure to market risk.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our chief executive officer (“CEO”) and chief financial officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the quarter ended June 30, 2021. Based on such evaluation, our CEO and CFO have concluded that as of June 30, 2021, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting (as defined in Rules 13a-15(d) and 15d-15(d) under the Exchange Act) during the quarter ended June 30, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Disclosure Controls and Procedures
Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and implemented, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues within a company are detected. The inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
37
PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we are involved in various legal proceedings arising from the normal course of business activities. We are not currently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows, or financial condition. Defending any such proceeding is costly and can impose a significant burden on management and employees. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.
Item 1A. Risk Factors.
There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020, except for changes to the risk factors below:
We may not realize the expected benefits of an industry shift away from cookie-based consumer tracking as such shift may not occur as rapidly as we expect or may not be realized at all.
We expect to benefit as compared to others in our industry from marketers reducing their reliance on vendors and software platforms that utilize third-party cookies for tracking. However, we cannot assure you that the shift away from cookie-based consumer tracking will happen as rapidly as we expect or that such shift will occur at all. For example, in June 2021, Google announced that its previously announced timeline of blocking third-party cookies by 2022 would be delayed until 2023. Additionally, even if the shift away from cookie-based consumer tracking does occur, we may not be as successful in growing our business and increasing our revenue as we expect. For example, marketers may not shift their business away from our competitors if our competitors are successful in developing alternative products or services that are not significantly reliant on the cookie-based framework.
Our business or ability to operate our platform could be impacted by changes in the technology industry by established technology companies or government regulation. Such developments, including the restriction of “third-party cookies,” could cause instability in the advertising technology industry.
Digital advertising and in-app advertising are largely dependent on established technology companies and their operation of the most commonly used Internet browsers (Chrome, Firefox, Internet Explorer and Safari), devices and their operating systems (Android and iOS). These companies may change the operations or policies of their browsers, devices and operating systems in a manner that fundamentally changes our ability to operate our platform or collect data. Users of these browsers, devices or operating systems may also adjust their behaviors and use of technology in ways that change our ability to collect data. Digital advertising and in-app advertising are also dependent, in part, on internet protocols and the practices of internet service providers, including IP address allocation. Changes that these providers make to their practices, or adoption of new internet protocols, may materially limit or alter the availability of data. A limitation or alteration of the availability of data in any of these or other instances may have a material impact on the advertising technology industry, which could decrease advertising budgets and subsequently reduce our revenue and adversely affect our business, operating results and financial condition.
For example, browser providers have recently enacted changes restricting the use of third-party cookies in their browsers, which may cause instability in the digital advertising market. Execution of digital advertising relies to a significant extent on the use of cookies, pixels and other similar technology, including mobile device identifiers that are provided by mobile operating systems for advertising purposes, which we refer to collectively as cookies, to collect data about users and devices. Although our business is less reliant on cookies than some of our competitors because we do not need cookies for marketers and their advertising agencies to identify consumers with our identity resolution capabilities and identity graph, we do use third-party cookies. Third-party cookies are cookies owned and used by parties other than the owners of the website visited by the Internet user, in connection with our business for execution of obtaining information about consumers, and for delivering digital advertising. In January 2020, Google publicly stated it intends for Chrome to block third-party cookies at some point in the following 24 months. Google has also introduced ad blocking software in its Chrome web browser that will block certain ads based on quality standards established under a multi-stakeholder coalition. Additionally, the Safari browser currently blocks third-party cookies by default and has recently added controls that algorithmically block or limit some cookies. Other browsers have added similar controls. These actions will have significant impacts on the digital advertising and marketing ecosystems in which we operate, which could cause changes in advertising budget allocations and thereby could negatively impact our business. In addition, these browser providers may frequently delay or change their previously announced operations or policies. For example, in June 2021, Google announced that it would delay its timeline of blocking third-party cookies by 2022 until 2023.
For in-app advertising, data regarding interactions between users and devices are tracked mostly through stable, pseudonymous mobile device identifiers that are built into the device operating system with privacy controls that allow users to express a preference with respect to data collection for advertising, including to disable the identifier. These identifiers and privacy controls are defined by
38
the developers of the mobile platforms and could be changed by the mobile platforms in a way that may negatively impact our business. Privacy aspects of other channels for programmatic advertising, such as connected TVs or over-the-top video, are still developing. Technical or policy changes, including regulation or industry self-regulation, could harm our growth in those channels.
Digital advertising is also subject to government regulation which may impact our ability to collect and use data. As the collection and use of data for digital advertising has received ongoing media attention over the past several years, some government regulators, such as the FTC, and privacy advocates have raised significant concerns around observed data. There has been an array of ‘do-not-track’ efforts, suggestions and technologies introduced to address these concerns. However, the potential regulatory and self-regulatory landscape is inherently uncertain, and there is no consensus definition of tracking, nor agreement on what would be covered by ‘do-not-track’ functionality. There is activity by the major Internet browsers to default set on ‘do-not-track’ functionality, including by Safari and Firefox. It is not clear if other Internet browsers will follow.
Limitations on our or our customers’ ability to collect and use data for advertising, whether imposed by established technology companies or U.S. legislation, or otherwise, may impact the performance of our platform.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Use of Proceeds
On February 12, 2021, we completed our IPO, pursuant to which we issued and sold an aggregate of 11,500,000 shares of common stock (inclusive of 1,500,000 shares pursuant to the underwriters’ option to purchase additional shares) at the IPO price of $25.00 per share. The aggregate gross proceeds to the Company from our IPO were $250.0 million and the net proceeds were $232.5 million after deducting underwriting discounts and commissions of $17.5 million. The offer and sale of the shares of common stock in the IPO were registered pursuant to registration statements on Form S-1 (File Nos. 333-252117 and 333-252907), which the SEC declared effective on February 9, 2021. No offering expenses were paid directly or indirectly to any of our directors or officers (or their associates) or persons owning 10% or more of any class of our equity securities or to any other affiliates. The underwriters for our IPO were BofA Securities, Inc., UBS Securities LLC, Canaccord Genuity LLC, JMP Securities LLC, Needham & Company, LLC and Raymond James & Associates, Inc.
There has been no material change in the intended use of proceeds from our IPO as described in our final prospectus filed with the SEC pursuant to Rule 424(b)(4) on February 10, 2021.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None.
39
Item 6. Exhibits.
The following is a list of exhibits filed as part of this Quarterly Report on Form 10-Q.
Exhibit Number |
|
Description |
|
|
|
3.1 |
|
|
|
|
|
3.2 |
|
|
|
|
|
31.1* |
|
|
|
|
|
31.2* |
|
|
|
|
|
32.1* |
|
|
|
|
|
32.2* |
|
|
|
|
|
101.INS |
|
Inline XBRL Instance Document |
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document |
101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document |
101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document |
104 |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* |
Filed herewith. |
40
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
Viant Technology Inc. |
|
|
|
|
|
Date: August 13, 2021 |
|
By: |
/s/ Tim Vanderhook |
|
|
|
Tim Vanderhook |
|
|
|
Chief Executive Officer and Chairman |
|
|
|
|
Date: August 13, 2021 |
|
By: |
/s/ Larry Madden |
|
|
|
Larry Madden |
|
|
|
Chief Financial Officer |
41
Exhibit 31.1
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Tim Vanderhook, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Viant Technology Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 13, 2021
/s/ Tim Vanderhook |
Tim Vanderhook |
Chief Executive Officer and Chairman |
Exhibit 31.2
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
I, Larry Madden, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Viant Technology Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(c) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 13, 2021
/s/ Larry Madden |
Larry Madden |
Chief Financial Officer |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Viant Technology Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Tim Vanderhook, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: August 13, 2021 |
By: |
/s/ Tim Vanderhook |
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Tim Vanderhook |
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Chief Executive Officer and Chairman |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Viant Technology Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Larry Madden, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: August 13, 2021 |
By: |
/s/ Larry Madden |
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Larry Madden |
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Chief Financial Officer |