Marin Software Incorporated (NASDAQ: MRIN), a leading provider
of digital marketing software for performance-driven advertisers
and agencies, today announced financial results for the second
quarter ended June 30, 2022.
“Having the right automation and optimization tools is
increasingly important for advertisers to outperform the
competition,” said Chris Lien, Marin Software’s Chairman and CEO.
“This quarter, we expanding our industry-leading automation tools
with improvements to our Rules Engine and Dynamic Actions.”
Second Quarter 2022 Product
Highlights:
- Recognized as a Strong Performer in The Forrester Wave™: B2B
Advertising Solutions, Q3 2022 , and cited as “best in class” for
B2B search and social advertising.
- Achieved verified partner status from Amazon Ads with our team
of specialists that are certified in Amazon Ads topics. Being part
of the Partner Network enables Marin to further develop our Amazon
Ads capabilities and engage more deeply with Amazon Advertising
with access to select beta programs and tailored training on
campaign strategies and new product releases.
- Upgraded our support for Google's newest campaign formats,
including Performance Max, Universal App, Discovery, and Video
(YouTube) Campaigns. We also launched support for Yahoo! Japan
Responsive Ads for Search (RAS).
- Completed the rollout of MarinOne Bidding, unlocking better
performance and improved accuracy with dynamic clustering and
improved intraday optimizations for all customers.
- Introduced MarinOne support for ad scheduling (dayparting) via
multi-edit, allowing advertisers to improve the performance of
their ads by adjusting when they are (and are not) shown.
- Significantly improved our Dimensions aggregation tools by
introducing campaign-level rollup views, view Dimension over time,
and the ability to segment Dimension data by device, match type,
and publisher. These changes further reduce the need for offline
data analysis.
- Introduced two new Insights, including RSA Coverage, which
identifies groups without any Responsive Search Ads, and First Page
Minimum Bid, which identifies objects performing below the Bid
Strategy efficiency goal and whose bids are artificially raised to
publisher first-page minimum bids.
- Made it easier to amplify organic posts by adding the ability
to duplicate Message Booster rules.
- Launched the Social Rules Engine to help automate key
workflows. With the Rules Engines, users can set triggers based on
any aspect of campaign performance that will adjust bid, status,
messaging, and more.
- Enhanced our Dynamic Actions automation features to allow
changes to additional objects, including Project Targets and
Dynamic Targets based on internal or external data signals.
- Streamlined the onboarding of new users, allowing advertisers
to get new hires up and running on MarinOne more quickly and
efficiently.
- Introduced chat functionality directly in MarinOne, so it is
possible for customers to reach our customer support team and ask
for help without ever having to navigate away from their own
account.
Second Quarter 2022 Financial
Updates:
- Net revenues totaled $4.7 million, a year-over-year decrease of
23% when compared to $6.1 million in the second quarter of
2021.
- GAAP loss from operations was ($5.6) million, resulting in a
GAAP operating margin of (119%), as compared to a GAAP loss from
operations of ($3.0) million and a GAAP operating margin of (49%)
for the second quarter of 2021.
- Non-GAAP loss from operations was ($4.6) million, resulting in
a non-GAAP operating margin of (98%), as compared to a non-GAAP
loss from operations of ($2.8) million and a non-GAAP operating
margin of (46%) for the second quarter of 2021.
Reconciliations of GAAP to non-GAAP financial measures have been
provided in the financial statement tables included in this press
release. An explanation of these measures is also included below,
under the heading “Non-GAAP Financial Measures.”
Financial Outlook:
Marin is providing guidance for its third quarter of 2022 as
follows:
Forward-Looking
Guidance
In millions
Range of Estimate
From
To
Three Months Ending September 30,
2022
Revenues, net
$
4.5
$
5.0
Non-GAAP loss from operations
(4.9
)
(4.5
)
Non-GAAP loss from operations excludes the effects of
stock-based compensation, amortization of internally developed
software, impairment of long-lived assets, capitalization of
internally developed software, non-recurring costs associated with
restructurings, and certain professional fees that the Company has
incurred in responding to third-party subpoenas that the Company
has received related to governmental investigations of Google and
Facebook.
Additionally, the Company does not reconcile its forward-looking
non-GAAP loss from operations, due to variability between revenues
and non-cash items such as stock-based compensation. The GAAP loss
from operations includes stock-based compensation expense, which is
affected by hiring and retention needs, as well as the future price
of Marin’s stock. As a result, a reconciliation of the
forward-looking non-GAAP financial measures to the corresponding
GAAP measures cannot be made without unreasonable effort.
Quarterly Results Conference
Call
Marin Software will host a conference call today at 2:00 PM
Pacific Time (5:00 PM Eastern Time) to review the Company’s
financial results for the quarter ended June 30, 2022, and its
outlook for the future. To access the call, please dial (877)
256-3669 in the United States or (201) 231-2913 internationally
with reference to conference ID 22019624. A live webcast of the
conference call will be accessible at
https://viavid.webcasts.com/starthere.jsp?ei=1559041&tp_key=3bf131ecde.
Following the completion of the call through 11:59 p.m. Eastern
Time on August 11, 2022, a recorded replay will be available on the
Company’s website at http://investor.marinsoftware.com/ and a
telephone replay will be available by dialing (844) 512-2921 in the
United States or (412) 317-6671 internationally with the recording
access code 22019624.
About Marin Software
Marin Software Incorporated’s (NASDAQ: MRIN) mission is to give
advertisers the power to drive higher efficiency and transparency
in their paid marketing programs that run on the world’s largest
publishers. Marin Software provides enterprise marketing software
for advertisers and agencies to integrate, align, and amplify their
digital advertising spend across the web and mobile devices. Marin
Software offers a unified SaaS advertising management platform for
search, social, and eCommerce advertising. The Company helps
digital marketers convert precise audiences, improve financial
performance, and make better decisions. Headquartered in San
Francisco with offices worldwide, Marin Software’s technology
powers marketing campaigns around the globe. For more information
about Marin Software, please visit www.marinsoftware.com.
Non-GAAP Financial
Measures
Marin uses certain non-GAAP financial measures in this release.
Marin uses these non-GAAP financial measures internally in
analyzing its financial results and believes they are useful to
investors, as a supplement to GAAP measures, in evaluating its
ongoing operational performance. Marin believes that the use of
these non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing our financial results with other companies in our
industry, many of which present similar non-GAAP financial measures
to investors. Non-GAAP financial measures that Marin uses may
differ from measures that other companies may use.
Non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, financial information
prepared in accordance with GAAP. A reconciliation of the non-GAAP
financial measures to their most directly comparable GAAP measures
has been provided in the financial statement tables included below
in this press release. Investors are encouraged to review the
reconciliation of these non-GAAP financial measures to their most
directly comparable GAAP financial measures.
Non-GAAP expenses, measures and net loss per share. Marin
defines non-GAAP sales and marketing, non-GAAP research and
development, non-GAAP general and administrative, non-GAAP gross
profit, non-GAAP operating loss and non-GAAP net loss as the
respective GAAP balances, adjusted for stock-based compensation,
amortization of internally developed software and intangible
assets, impairment of goodwill and long-lived assets, non-cash
expenses related to debt agreements, capitalization of internally
developed software, CARES Act employee retention credit,
non-recurring costs associated with restructurings, and certain
professional fees that the Company has incurred in responding to
third-party subpoenas that the Company has received related to
governmental investigations of Google and Facebook. Non-GAAP net
loss per share is calculated as non-GAAP net loss divided by the
weighted average shares outstanding.
Adjusted EBITDA. Marin defines Adjusted EBITDA as net loss,
adjusted for stock-based compensation expense, depreciation,
amortization of internally developed software and intangible
assets, capitalization of internally developed software, impairment
of goodwill and long-lived assets, benefit from or provision for
income taxes, CARES Act employee retention credit, other income,
net, non-recurring costs associated with restructurings, and
certain professional fees that the Company has incurred in
responding to third-party subpoenas that the Company has received
related to governmental investigations of Google and Facebook.
These amounts are often excluded by other companies to help
investors understand the operational performance of their business.
The Company uses Adjusted EBITDA as a measurement of its operating
performance because it assists in comparing the operating
performance on a consistent basis by removing the impact of certain
non-cash and non-operating items. Adjusted EBITDA reflects an
additional way of viewing aspects of the operations that Marin
believes, when viewed with the GAAP results and the accompanying
reconciliations to corresponding GAAP financial measures, provide a
more complete understanding of factors and trends affecting its
business.
Forward-Looking
Statements
This press release contains forward-looking statements
including, among other things, statements regarding Marin’s
business, impact of investments in product and technology on future
operating results, progress on product development efforts, product
capabilities, advertiser and customer behavior, effects of the
COVID-19 pandemic, and future financial results, including its
outlook for the third quarter of 2022. These forward-looking
statements are subject to the safe harbor provisions created by the
Private Securities Litigation Reform Act of 1995. Actual results
could differ materially from those projected in the forward-looking
statements as a result of certain risk factors, including but not
limited to any lingering effects of the global outbreak of COVID-19
on demand for our products and services; the amount of digital
advertising spend managed by our customers using our products; the
extent of customer acceptance and adoption of our MarinOne
platform; the productivity of our personnel and other aspects of
our business; our ability to maintain or grow sales to new and
existing customers; any adverse changes in our relationships with
and access to publishers and advertising agencies and strategic
business partners, including any adverse changes in our revenue
sharing agreement with Google; our ability to raise additional
capital; our ability to manage expenses; the success of any
increased investments that we may make in our engineering and sales
and marketing teams; our ability to retain and attract qualified
management, technical and sales and marketing personnel; any delays
in the release of updates to our product platform or new features
or delays in customer deployment of any such updates or features;
competitive factors, including but not limited to pricing
pressures, entry of new competitors and new applications; quarterly
fluctuations in our operating results due to a number of factors;
inability to adequately forecast our future revenues, expenses,
Adjusted EBITDA, cash flows or other financial metrics; delays,
reductions or slower growth in the amount spent on online and
mobile advertising and the development of the market for
cloud-based software; progress in our efforts to update our
software platform; level of usage and advertising spend managed on
our platform; our ability to maintain or expand sales of our
solutions in channels other than search advertising; any slow-down
in the search advertising market generally; any shift in customer
digital advertising budgets from search to segments in which we are
not as deeply penetrated; the development of the market for digital
advertising; acceptance and continued usage of our platform and
services by customers and our ability to provide high-quality
technical support to our customers; material defects in our
platform including those resulting from any updates we introduce to
our platform, service interruptions at our single third-party data
center or breaches in our security measures; our ability to develop
enhancements to our platform; our ability to protect our
intellectual property; our ability to manage risks associated with
international operations; the impact of fluctuations in currency
exchange rates, particularly an increase in the value of the
dollar; near term changes in sales of our software services or
spend under management may not be immediately reflected in our
results due to our subscription business model; and adverse changes
in general economic or market conditions. These forward-looking
statements are based on current expectations and are subject to
uncertainties and changes in condition, significance, value and
effect as well as other risks detailed in documents filed with the
Securities and Exchange Commission, including our most recent
report on Form 10-K, recent reports on Form 10-Q and current
reports on Form 8-K, which we may file from time to time, and all
of which are available free of charge at the SEC’s website at
www.sec.gov. Any of these risks could cause actual results to
differ materially from expectations set forth in the
forward-looking statements. All forward-looking statements in this
press release reflect Marin’s expectations as of August 4, 2022.
Marin assumes no obligation to, and expressly disclaims any
obligation to update any such forward-looking statements after the
date of this release.
Marin Software Incorporated
Condensed Consolidated Balance
Sheets
(On a GAAP basis)
June 30,
December 31,
(Unaudited; in thousands, except par
value)
2022
2021
Assets:
Current assets:
Cash and cash equivalents
$
37,267
$
46,842
Restricted cash
215
215
Accounts receivable, net
3,988
4,633
Prepaid expenses and other current
assets
1,433
2,324
Total current assets
42,903
54,014
Property and equipment, net
3,228
3,622
Right-of-use assets, operating leases
4,843
1,660
Other non-current assets
591
535
Total assets
$
51,565
$
59,831
Liabilities and Stockholders'
Equity:
Current liabilities:
Accounts payable
$
718
$
975
Accrued expenses and other current
liabilities
4,392
6,176
Note payable, current
—
2,226
Operating lease liabilities
1,861
2,006
Total current liabilities
6,971
11,383
Note payable, net of current
—
1,094
Operating lease liabilities,
non-current
3,034
—
Other long-term liabilities
1,009
1,096
Total liabilities
11,014
13,573
Stockholders’ equity:
Common stock, $0.001 par value
16
15
Additional paid-in capital
353,018
351,394
Accumulated deficit
(311,480
)
(304,107
)
Accumulated other comprehensive loss
(1,003
)
(1,044
)
Total stockholders’ equity
40,551
46,258
Total liabilities and stockholders’
equity
$
51,565
$
59,831
Marin Software Incorporated
Condensed Consolidated Statements of
Operations
(On a GAAP basis)
Three Months Ended June
30,
Six Months Ended June
30,
(Unaudited; in thousands, except per
share data)
2022
2021
2022
2021
Revenues, net
$
4,720
$
6,094
$
9,881
$
12,402
Cost of revenues
3,203
3,175
6,531
6,416
Gross profit
1,517
2,919
3,350
5,986
Operating expenses:
Sales and marketing
1,588
1,268
3,375
2,514
Research and development
2,980
2,667
5,897
5,066
General and administrative
2,545
1,995
5,014
3,864
Total operating expenses
7,113
5,930
14,286
11,444
Loss from operations
(5,596
)
(3,011
)
(10,936
)
(5,458
)
Other income, net
297
221
3,699
548
Loss before income taxes
(5,299
)
(2,790
)
(7,237
)
(4,910
)
Income tax provision (benefit)
75
(289
)
136
(197
)
Net loss
$
(5,374
)
$
(2,501
)
$
(7,373
)
$
(4,713
)
Net loss per common share, basic and
diluted
$
(0.34
)
$
(0.23
)
$
(0.47
)
$
(0.44
)
Weighted-average shares outstanding, basic
and diluted
15,651
11,034
15,594
10,669
Marin Software Incorporated
Condensed Consolidated Statements of
Cash Flows
(On a GAAP basis)
Six Months Ended June
30,
(Unaudited; in thousands)
2022
2021
Operating activities:
Net loss
$
(7,373
)
$
(4,713
)
Adjustments to reconcile net loss to net
cash used in operating activities
Depreciation
378
463
Amortization of internally developed
software
973
1,220
Amortization of deferred costs to obtain
and fulfill contracts
171
268
Forgiveness of Paycheck Protection Program
loan
(3,117
)
—
Interest expense
—
6
Loss on disposals of property and
equipment and right-of-use assets
—
32
Unrealized foreign currency losses
82
32
Stock-based compensation related to equity
awards
1,657
641
Provision for bad debts
(63
)
(51
)
Net change in operating leases
(294
)
(252
)
Deferred income tax benefits
(77
)
—
Changes in operating assets and
liabilities
Accounts receivable
727
724
Prepaid expenses and other assets
748
607
Accounts payable
(253
)
(330
)
Accrued expenses and other liabilities
(1,851
)
(1,424
)
Net cash used in operating activities
(8,292
)
(2,777
)
Investing activities:
Purchases of property and equipment
(13
)
(6
)
Capitalization of internally developed
software
(894
)
(632
)
Net cash used in investing activities
(907
)
(638
)
Financing activities:
Proceeds from issuance of common shares
through at-the-market offering, net of offering costs
—
3,120
Payment of principal on finance lease
liabilities
—
(15
)
Repayment of Paycheck Protection Program
loan
(203
)
—
Employee taxes paid for withheld shares
upon equity award settlement
(95
)
(120
)
Proceeds from employee stock purchase
plan, net
19
15
Net cash (used in) provided by financing
activities
(279
)
3,000
Effect of foreign exchange rate changes on
cash and cash equivalents and restricted cash
(97
)
(28
)
Net decrease in cash and cash equivalents
and restricted cash
(9,575
)
(443
)
Cash and cash equivalents and
restricted cash:
Beginning of period
47,057
14,820
End of the period
$
37,482
$
14,377
Marin Software Incorporated
Reconciliation of GAAP to Non-GAAP
Expenses
Three Months Ended
Year Ended
Three Months Ended
Mar 31,
Jun 30,
Sep 30,
Dec 31,
Dec 31,
Mar 31,
Jun 30,
(Unaudited; in thousands)
2021
2021
2021
2021
2021
2022
2022
Sales and Marketing (GAAP)
$
1,246
$
1,268
$
1,266
$
1,702
$
5,482
$
1,787
$
1,588
Less Stock-based compensation
(66
)
(70
)
(122
)
(150
)
(408
)
(175
)
(157
)
Less Restructuring related expenses
2
—
—
(136
)
(134
)
—
—
Plus CARES Act employee retention
credit
42
42
60
—
144
—
—
Sales and Marketing (Non-GAAP)
$
1,224
$
1,240
$
1,204
$
1,416
$
5,084
$
1,612
$
1,431
Research and Development (GAAP)
$
2,399
$
2,667
$
2,677
$
3,045
$
10,788
$
2,917
$
2,980
Less Stock-based compensation
(98
)
(133
)
(159
)
(204
)
(594
)
(224
)
(213
)
Less Restructuring related expenses
(2
)
—
—
—
(2
)
(36
)
(59
)
Plus CARES Act employee retention
credit
252
238
245
—
735
—
—
Plus Capitalization of internally
developed software
434
238
362
343
1,377
512
408
Research and Development (Non-GAAP)
$
2,985
$
3,010
$
3,125
$
3,184
$
12,304
$
3,169
$
3,116
General and Administrative (GAAP)
$
1,869
$
1,995
$
2,312
$
3,151
$
9,327
$
2,469
$
2,545
Less Stock-based compensation
(63
)
(130
)
(248
)
(287
)
(728
)
(334
)
(340
)
Less Restructuring related expenses
(2
)
—
-
-
(2
)
—
—
Plus CARES Act employee retention
credit
70
66
67
—
203
—
—
Less Third-party subpoena-related
expenses
—
—
(87
)
(405
)
(492
)
(72
)
(99
)
General and Administrative (Non-GAAP)
$
1,874
$
1,931
$
2,044
$
2,459
$
8,308
$
2,063
$
2,106
Marin Software Incorporated
Reconciliation of GAAP to Non-GAAP
Measures
Three Months Ended
Year Ended
Three Months Ended
Mar 31,
Jun 30,
Sep 30,
Dec 31,
Dec 31,
Mar 31,
Jun 30,
(Unaudited; in thousands)
2021
2021
2021
2021
2021
2022
2022
Gross Profit (GAAP)
$
3,067
$
2,919
$
2,980
$
2,569
$
11,535
$
1,833
$
1,517
Plus Stock-based compensation
35
46
103
107
291
124
90
Plus Amortization of internally developed
software
624
596
586
550
2,356
542
431
Plus Restructuring related expenses
1
—
—
42
43
17
—
Less CARES Act employee retention
credit
(175
)
(179
)
(174
)
—
(528
)
—
—
Gross Profit (Non-GAAP)
$
3,552
$
3,382
$
3,495
$
3,268
$
13,697
$
2,516
$
2,038
Operating Loss (GAAP)
$
(2,447
)
$
(3,011
)
$
(3,275
)
$
(5,329
)
$
(14,062
)
$
(5,340
)
$
(5,596
)
Plus Stock-based compensation
262
379
632
748
2,021
857
800
Plus Amortization of internally developed
software
624
596
586
550
2,356
542
431
Plus Restructuring related expenses
3
—
—
178
181
53
59
Less CARES Act employee retention
credit
(539
)
(525
)
(546
)
—
(1,610
)
—
—
Less Capitalization of internally
developed software
(434
)
(238
)
(362
)
(343
)
(1,377
)
(512
)
(408
)
Plus Third-party subpoena-related
expenses
—
—
87
405
492
72
99
Operating Loss (Non-GAAP)
$
(2,531
)
$
(2,799
)
$
(2,878
)
$
(3,791
)
$
(11,999
)
$
(4,328
)
$
(4,615
)
Net Loss (GAAP)
$
(2,212
)
$
(2,501
)
$
(3,130
)
$
(5,101
)
$
(12,944
)
$
(1,999
)
$
(5,374
)
Plus Stock-based compensation
262
379
632
748
2,021
857
800
Plus Amortization of internally developed
software
624
596
586
550
2,356
542
431
Plus Restructuring related expenses
3
—
—
178
181
53
59
Less CARES Act employee retention
credit
(539
)
(525
)
(546
)
—
(1,610
)
—
—
Less Capitalization of internally
developed software
(434
)
(238
)
(362
)
(343
)
(1,377
)
(512
)
(408
)
Plus Third-party subpoena-related
expenses
—
—
87
405
492
72
99
Less Forgiveness and repayment of Paycheck
Protection Program loan
—
—
—
—
—
(3,320
)
—
Net Loss (Non-GAAP)
$
(2,296
)
$
(2,289
)
$
(2,733
)
$
(3,563
)
$
(10,881
)
$
(4,307
)
$
(4,393
)
Marin Software Incorporated
Calculation of Non-GAAP Earnings Per
Share
Three Months Ended
Year Ended
Three Months Ended
Mar 31,
Jun 30,
Sep 30,
Dec 31,
Dec 31,
Mar 31,
Jun 30,
(Unaudited; in thousands, except per
share data)
2021
2021
2021
2021
2021
2022
2022
Net Loss (Non-GAAP)
$
(2,296
)
$
(2,289
)
$
(2,733
)
$
(3,563
)
$
(10,881
)
$
(4,307
)
$
(4,393
)
Weighted-average shares outstanding, basic
and diluted
10,300
11,034
14,500
15,513
12,846
15,537
15,651
Non-GAAP net loss per common share, basic
and diluted
$
(0.22
)
$
(0.21
)
$
(0.19
)
$
(0.23
)
$
(0.85
)
$
(0.28
)
$
(0.28
)
Marin Software Incorporated Reconciliation of Net
Loss to Adjusted EBITDA
Three Months Ended
Year Ended
Three Months Ended
Mar 31,
Jun 30,
Sep 30,
Dec 31,
Dec 31,
Mar 31,
Jun 30,
(Unaudited; in thousands)
2021
2021
2021
2021
2021
2022
2022
Net Loss
$
(2,212
)
$
(2,501
)
$
(3,130
)
$
(5,101
)
$
(12,944
)
$
(1,999
)
$
(5,374
)
Depreciation
240
223
207
181
851
179
199
Amortization of internally developed
software
624
596
586
550
2,356
542
431
Provision for (benefit from) income
taxes
92
(289
)
153
(90
)
(134
)
61
75
Stock-based compensation
262
379
632
748
2,021
857
800
CARES Act employee retention credit
(539
)
(525
)
(546
)
—
(1,610
)
—
—
Capitalization of internally developed
software
(434
)
(238
)
(362
)
(343
)
(1,377
)
(512
)
(408
)
Restructuring related expenses
3
—
—
178
181
53
59
Other income, net
(327
)
(221
)
(298
)
(138
)
(984
)
(3,402
)
(297
)
Third-party subpoena-related expenses
—
—
87
405
492
72
99
Adjusted EBITDA
$
(2,291
)
$
(2,576
)
$
(2,671
)
$
(3,610
)
$
(11,148
)
$
(4,149
)
$
(4,416
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220804005103/en/
Investor Relations, Marin Software
ir@marinsoftware.com
Media Contact Wesley MacLaggan Marketing, Marin Software
(415) 399-2580 press@marinsoftware.com
Marin Software (NASDAQ:MRIN)
Historical Stock Chart
From May 2024 to Jun 2024
Marin Software (NASDAQ:MRIN)
Historical Stock Chart
From Jun 2023 to Jun 2024