SEATTLE, May 12, 2021 /PRNewswire/ -- RealNetworks, Inc.
(Nasdaq: RNWK), a leader in AI-powered digital media software and
solutions, today announced its financial results* for the first
quarter ended March 31, 2021.
- Revenue of $15.9 million,
driven by growth in AI-businesses offset by declines in some of the
Company's foundation businesses
- 160% year-over-year revenue growth for SAFRTM
driven by successes in the U.S. Federal market and in global
commercial applications
- Net loss of $(10.6)
million; adjusted EBITDA loss of $(3.0) million marking the seventh consecutive
quarter of year-over-year improvement; adjusted EBITDA of
$(2.4) million excluding
Scener
- Completed public offering of common stock for
approximately $20.3 million in net
proceeds on April 29,
2021
Management Commentary
"2021 got off to a strong start at Real," said Rob Glaser, Founder, Chairman, and Chief
Executive Officer of RealNetworks. "We continued to progress in our
strategic transformation to an AI-based company. Our first AI
business, SAFR, grew approximately 160% year-over-year and our
second AI business, KONTXT, grew 10% year-over-year. We told our AI
story publicly for the first time to investors as part of our
recent public offering, and as a result, raised approximately
$20.3 million in net proceeds. These
additional resources position us well to accelerate our AI
efforts."
First Quarter 2021 Financial Highlights from Continuing
Operations
- Revenue was $15.9 million, down
10% compared to $17.6 million in the
prior quarter and down 6% compared to $16.8
million in the prior year period.
- Revenue from key growth initiatives, SAFR and KONTXT, increased
160% and 10%, respectively, compared to the prior year period. SAFR
and KONTXT together grew to represent 29% of total Mobile Services
revenue for the first quarter of 2021.
- Gross profit margin was 77%, unchanged from the prior quarter
and up from 76% in the prior year period.
- Operating expenses increased $10.3
million, or 127%, from the prior quarter and increased
$0.9 million, or 5%, from the prior
year period. Normalizing for certain one-time and non-cash items,
operating expenses increased $1.2
million, or 8%, compared to the prior quarter and decreased
$1.5 million, or 8%, from the prior
year period. The increase in operating expenses compared to the
fourth quarter of 2020 was primarily due to restructuring, fair
value adjustments to the contingent consideration liability and
higher stock-based compensation expenses.
- Net loss attributable to RealNetworks was $(10.4) million, or $(0.27) per diluted share, compared to net income
of $6.1 million, or $0.16 per diluted share, in the prior quarter and
a net loss of $(4.6) million, or
$(0.12) per diluted share, in the
prior year period. Included in net loss attributable to
RealNetworks in the first quarter of 2021 was a loss of
$4.3 million from the fair value
adjustment to the Company's interest in MelodyVR stock (now Napster
Group PLC (LSE: "NAPS")) and $3.2
million of restructuring.
- Adjusted EBITDA was a loss of $(3.0)
million compared to a loss of $(0.9)
million in the prior quarter and a loss of $(4.4) million in the prior year period. Adjusted
EBITDA for the first quarter of 2021 excluding $600,000 of costs related to Scener was a loss of
$(2.4) million.
- At March 31, 2021, the Company
had $17.0 million in unrestricted
cash and cash equivalents compared to $23.9
million at December 31, 2020
and $19.0 million at March 31, 2020. In April
2021, the Company strengthened its balance sheet with the
closing of an underwritten public offering that resulted in net
proceeds to the Company of approximately $20.3 million.
Business Outlook
For the second quarter ending June 30,
2021, RealNetworks expects to achieve the following results
from continuing operations:
- Total revenue is expected to be in the range of $14.0 million to $15.5
million.
- Adjusted EBITDA loss is expected to be in the range of
$(6.0) million to $(4.5) million, including Scener expenses of up
to $750,000, and in the range of
$(5.25) million to $(3.75) million, excluding Scener (which is in
the process of being spun out).
As announced as part of the Company's April 2021 public offering, RealNetworks'
management currently expects 2021 will be an investment year that
will position the Company for double-digit revenue growth in 2022
and 2023.
Conference Call and Webcast Information
RealNetworks will host a conference call today to review its
results and discuss its performance at approximately 4:30 p.m. ET / 1:30 p.m.
PT. Participants may join the conference call by dialing
1-877-451-6152 (United States) or
1-201-389-0879 (International). A telephonic replay of the call
will also be available shortly after the completion of the call,
until 11:59 pm ET on Wednesday, June
2, 2021, by dialing 1-844-512-2921 (United States) or 1-412-317-6671
(International) and entering the replay pin number: 13718557.
A live webcast will be available on RealNetworks' Investor
Relations site under the Events & Presentations section at
http://investor.realnetworks.com and will be archived online
upon completion of the conference call.
About RealNetworks
Building on a rich history of digital media expertise and
innovation, RealNetworks has created a new generation of products
that employ best-in-class artificial intelligence and machine
learning to enhance and secure our daily lives. Real's portfolio
includes SAFR, the world's premier computer vision platform for
live video; KONTXT, an industry leading NLP (Natural Language
Processing) platform for text and multi-media analysis; and
leveraging its digital media expertise, a mobile games business
focused on the large free-to-play segment. For information about
all of our products, visit www.realnetworks.com.
About Continuing and Discontinued Operations and Non-GAAP
Financial Measures
*This release refers to "continuing" and "discontinued"
operations due to the completion of the sale of Napster,
RealNetworks' 84%-owned subsidiary, to MelodyVR Group PLC, which
closed on December 30, 2020.
Effective as of the August 25, 2020
announcement date, Napster has been treated as a discontinued
operation for accounting and disclosure purposes; therefore, unless
otherwise noted, results presented in this release relate to the
continuing operations of RealNetworks, which exclude Napster.
To supplement RealNetworks' consolidated financial information
presented in accordance with GAAP in this press release, the
company also discloses certain non-GAAP financial measures,
including adjusted EBITDA and contribution margin by reportable
segment, which management believes provide investors with useful
information.
In the financial tables of our earnings press release,
RealNetworks has included reconciliations of GAAP net income (loss)
from continuing operations to adjusted EBITDA and operating income
(loss) by reportable segment to contribution margin by reportable
segment.
The rationale for management's use of non-GAAP measures is
included in the supplementary materials presented with the
quarterly earnings materials. Please refer to Exhibit 99.2
("Information Regarding Non-GAAP Financial Measures") to the
company's report on Form 8-K, which is being submitted today to the
SEC.
Forward-Looking Statements
This press release contains
forward-looking statements that involve risks and uncertainties,
including statements relating to our current expectations regarding
our future growth, profitability, and market position, our
financial condition and liquidity, our strategic focus and
initiatives, product plans, agreements with partners, and
expectations and contingencies relating to the sale of Napster. All
statements contained in this press release that do not relate to
matters of historical fact should be considered forward-looking
statements. These statements reflect our expectations as of
today, and actual results may differ materially from the results
predicted. Factors that could cause actual results for
RealNetworks, on a consolidated basis, to differ from the results
predicted include: our ability to realize operating efficiencies,
growth and other benefits from the implementation of our growth
initiatives and restructuring efforts; cash usage and conservation,
and the pursuit of additional funding sources; successful
monetization of our products and services; competitive risks;
issues with the use of AI; potential outcomes and effects of claims
and legal proceedings; risks associated with key customer or
strategic relationships and business acquisitions and dispositions;
challenges caused by the COVID-19 pandemic; disruptions in the
global financial markets; volatility of our stock price; material
asset impairment; continued declines in subscription revenue;
difficulty recruiting and retaining key personnel; regulatory, tax,
accounting, and cross-border risks; and risks related to our
governance structure. More information about potential risk factors
that could affect our business and financial results is included in
RealNetworks' latest annual report on Form 10-K for year ended
December 31, 2020, its quarterly
reports on Form 10-Q and in other reports and documents filed by
RealNetworks from time to time with the Securities and Exchange
Commission. The preparation of our financial statements and
forward-looking financial guidance requires us to make estimates
and assumptions that affect the reported amount of assets and
liabilities, and revenues and expenses during the reported period.
Actual results may differ materially from these estimates under
different assumptions or conditions. RealNetworks assumes no
obligation to update any forward-looking statements or information,
which are in effect as of their respective dates.
For More Information:
Investor Relations for
RealNetworks
Kimberly Orlando, Addo Investor
Relations
310-829-5400
IR@realnetworks.com
RNWK-F
RealNetworks, Inc.
and Subsidiaries
Condensed
Consolidated Statements of Operations
(Unaudited)
|
|
|
Quarter Ended
March 31,
|
|
2021
|
|
2020
|
|
|
|
|
|
(in
thousands, except per
share data)
|
|
|
|
|
Net
revenue
|
$
|
15,888
|
|
|
$
|
16,822
|
|
Cost of
revenue
|
3,679
|
|
|
4,104
|
|
Gross profit
|
12,209
|
|
|
12,718
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
Research and
development
|
6,238
|
|
|
6,606
|
|
Sales and
marketing
|
5,137
|
|
|
6,000
|
|
General and
administrative
|
4,898
|
|
|
5,161
|
|
Fair value adjustments
to contingent consideration liability
|
(1,040)
|
|
|
(300)
|
|
Restructuring
and other charges
|
3,171
|
|
|
86
|
|
|
|
|
|
Total operating expenses
|
18,404
|
|
|
17,553
|
|
|
|
|
|
Operating
loss
|
(6,195)
|
|
|
(4,835)
|
|
|
|
|
|
Other income
(expenses):
|
|
|
|
Interest
expense
|
(95)
|
|
|
—
|
|
Interest
income
|
13
|
|
|
6
|
|
Loss on equity
and other investments, net
|
(4,272)
|
|
|
—
|
|
Other income,
net
|
104
|
|
|
238
|
|
|
|
|
|
Total other income (expenses), net
|
(4,250)
|
|
|
244
|
|
|
|
|
|
Loss from continuing
operations before income taxes
|
(10,445)
|
|
|
(4,591)
|
|
Income tax
expense
|
109
|
|
|
25
|
|
|
|
|
|
Net loss from
continuing operations
|
(10,554)
|
|
|
(4,616)
|
|
Net loss from
discontinued operations, net of tax
|
—
|
|
|
(73)
|
|
Net loss
|
(10,554)
|
|
|
(4,689)
|
|
Net loss attributable
to noncontrolling interests of continuing operations
|
(106)
|
|
|
(53)
|
|
Net income
attributable to noncontrolling interests of discontinued
operations
|
—
|
|
|
6
|
|
Net loss attributable
to RealNetworks
|
$
|
(10,448)
|
|
|
$
|
(4,642)
|
|
|
|
|
|
Net loss from
continuing operations attributable to RealNetworks
|
$
|
(10,448)
|
|
|
$
|
(4,563)
|
|
Net loss from
discontinued operations attributable to RealNetworks
|
—
|
|
|
(79)
|
|
Net loss attributable
to RealNetworks
|
$
|
(10,448)
|
|
|
$
|
(4,642)
|
|
|
|
|
|
Net loss per share
attributable to RealNetworks- Basic:
|
|
|
|
Continuing
operations
|
$
|
(0.27)
|
|
|
$
|
(0.12)
|
|
Discontinued
operations
|
—
|
|
|
—
|
|
Net loss per share attributable to RealNetworks- Basic
|
$
|
(0.27)
|
|
|
$
|
(0.12)
|
|
|
|
|
|
Net loss per share
attributable to RealNetworks- Diluted:
|
|
|
|
Continuing
operations
|
$
|
(0.27)
|
|
|
$
|
(0.12)
|
|
Discontinued
operations
|
—
|
|
|
—
|
|
Net loss per share attributable to RealNetworks- Diluted
|
$
|
(0.27)
|
|
|
$
|
(0.12)
|
|
|
|
|
|
Shares used to
compute basic net loss per share
|
38,502
|
|
|
38,229
|
|
Shares used to
compute diluted net loss per share
|
38,502
|
|
|
38,229
|
|
RealNetworks, Inc.
and Subsidiaries
Condensed
Consolidated Balance Sheets
(Unaudited)
|
|
|
March 31,
2021
|
|
December
31,
2020
|
|
(in
thousands)
|
ASSETS
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
17,015
|
|
|
$
|
23,940
|
|
Trade accounts
receivable, net
|
12,469
|
|
|
10,229
|
|
Deferred costs,
current portion
|
262
|
|
|
196
|
|
Investments
|
5,693
|
|
|
9,965
|
|
Prepaid expenses
and other current assets
|
3,833
|
|
|
3,480
|
|
Total
current assets
|
39,272
|
|
|
47,810
|
|
|
|
|
|
Equipment and
software
|
30,313
|
|
|
30,726
|
|
Leasehold
improvements
|
2,745
|
|
|
2,776
|
|
Total equipment,
software, and leasehold improvements
|
33,058
|
|
|
33,502
|
|
Less accumulated
depreciation and amortization
|
31,381
|
|
|
31,631
|
|
Net equipment,
software, and leasehold improvements
|
1,677
|
|
|
1,871
|
|
|
|
|
|
Operating lease
assets
|
4,771
|
|
|
7,937
|
|
Restricted cash
equivalents
|
1,630
|
|
|
1,630
|
|
Other
assets
|
3,792
|
|
|
4,150
|
|
Deferred costs,
non-current portion
|
71
|
|
|
74
|
|
Deferred tax
assets, net
|
874
|
|
|
909
|
|
Goodwill
|
17,191
|
|
|
17,375
|
|
|
|
|
|
Total
assets
|
$
|
69,278
|
|
|
$
|
81,756
|
|
|
|
|
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
3,448
|
|
|
$
|
2,750
|
|
Accrued and
other current liabilities
|
15,230
|
|
|
17,850
|
|
Deferred
revenue, current portion
|
2,302
|
|
|
2,122
|
|
Total current
liabilities
|
20,980
|
|
|
22,722
|
|
|
|
|
|
Deferred
revenue, non-current portion
|
35
|
|
|
45
|
|
Deferred tax
liabilities, net
|
1,101
|
|
|
1,129
|
|
Long-term lease
liabilities
|
6,098
|
|
|
6,837
|
|
Long-term
debt
|
2,902
|
|
|
2,895
|
|
Other long-term
liabilities
|
2,171
|
|
|
2,241
|
|
|
|
|
|
Total
liabilities
|
33,287
|
|
|
35,869
|
|
|
|
|
|
Total
shareholders' equity
|
36,359
|
|
|
46,149
|
|
|
|
|
|
Noncontrolling
interests
|
(368)
|
|
|
(262)
|
|
|
|
|
|
Total
equity
|
35,991
|
|
|
45,887
|
|
|
|
|
|
Total
liabilities and equity
|
$
|
69,278
|
|
|
$
|
81,756
|
|
RealNetworks, Inc.
and Subsidiaries
Condensed
Consolidated Statements of Cash Flows
(Unaudited)
|
|
|
Three Months Ended
March 31,
|
|
2021
|
|
2020
|
|
(in
thousands)
|
|
Cash flows from
operating activities:
|
|
|
|
Net loss from
continuing operations
|
$
|
(10,554)
|
|
|
$
|
(4,616)
|
|
Adjustment to reconcile
net loss from continuing operations to net cash used in
operating
activities:
|
|
|
|
Depreciation and
amortization
|
204
|
|
|
280
|
|
Stock-based
compensation
|
836
|
|
|
380
|
|
Loss on equity and
other investments, net
|
4,272
|
|
|
—
|
|
Loss on impairment of
operating lease assets
|
2,461
|
|
|
—
|
|
Foreign currency
gain
|
(103)
|
|
|
(210)
|
|
Fair value adjustments
to contingent consideration liability
|
(1,040)
|
|
|
(300)
|
|
Net change in certain
operating assets and liabilities
|
(3,052)
|
|
|
(1,457)
|
|
Net cash used in
operating activities - continuing operations
|
(6,976)
|
|
|
(5,923)
|
|
Net cash provided in
operating activities - discontinued operations
|
—
|
|
|
1,299
|
|
Net cash used in
operating activities
|
(6,976)
|
|
|
(4,624)
|
|
Cash flows from
investing activities:
|
|
|
|
Purchases of equipment,
software, and leasehold improvements
|
(56)
|
|
|
(80)
|
|
Net cash used in
investing activities - continuing operations
|
(56)
|
|
|
(80)
|
|
Net cash used in
investing activities - discontinued operations
|
—
|
|
|
(14)
|
|
Net cash used in
investing activities
|
(56)
|
|
|
(94)
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from issuance
of common stock (stock options)
|
468
|
|
|
—
|
|
Proceeds from issuance
of preferred stock
|
—
|
|
|
10,000
|
|
Tax payments from
shares withheld upon vesting of restricted stock
|
(110)
|
|
|
—
|
|
Net cash provided by
financing activities - continuing operations
|
358
|
|
|
10,000
|
|
Net cash used in
financing activities - discontinued operations
|
—
|
|
|
(2,404)
|
|
Net cash provided by
financing activities
|
358
|
|
|
7,596
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(251)
|
|
|
(637)
|
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
(6,925)
|
|
|
2,241
|
|
Cash, cash
equivalents, and restricted cash, beginning of period
|
25,570
|
|
|
22,179
|
|
Cash, cash
equivalents, and restricted cash, end of period
|
18,645
|
|
|
24,420
|
|
Less: Cash, cash
equivalents and restricted cash from discontinued
operations
|
—
|
|
|
8,025
|
|
Cash, cash
equivalents, and restricted cash from continuing operations,
end of period
|
$
|
18,645
|
|
|
$
|
16,395
|
|
RealNetworks, Inc.
and Subsidiaries
Supplemental
Financial Information
(Unaudited)
|
|
|
|
2021
|
|
2020
|
|
|
Q1
|
|
Q4
|
|
Q3
|
|
Q2
|
|
Q1
|
|
|
(in
thousands)
|
Net Revenue by
Segment
|
|
|
|
|
|
|
|
|
|
Consumer Media
(A)
|
|
$
|
3,309
|
|
|
$
|
3,384
|
|
|
$
|
2,543
|
|
|
$
|
3,159
|
|
|
$
|
3,495
|
|
Mobile Services
(B)
|
|
5,980
|
|
|
7,338
|
|
|
6,400
|
|
|
6,461
|
|
|
6,690
|
|
Games (C)
|
|
6,599
|
|
|
6,879
|
|
|
7,611
|
|
|
7,465
|
|
|
6,637
|
|
Total net
revenue
|
|
$
|
15,888
|
|
|
$
|
17,601
|
|
|
$
|
16,554
|
|
|
$
|
17,085
|
|
|
$
|
16,822
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue by
Product
|
|
|
|
|
|
|
|
|
|
|
Consumer
Media
|
|
|
|
|
|
|
|
|
|
|
- Software License
(D)
|
|
$
|
1,875
|
|
|
$
|
1,593
|
|
|
$
|
642
|
|
|
$
|
1,702
|
|
|
$
|
2,020
|
|
- Subscription
Services (E)
|
|
818
|
|
|
867
|
|
|
892
|
|
|
898
|
|
|
929
|
|
- Product Sales
(F)
|
|
438
|
|
|
625
|
|
|
193
|
|
|
261
|
|
|
222
|
|
- Advertising &
Other (G)
|
|
178
|
|
|
299
|
|
|
816
|
|
|
298
|
|
|
324
|
|
|
|
|
|
|
|
|
|
|
|
|
Mobile
Services
|
|
|
|
|
|
|
|
|
|
|
- Software License
(H)
|
|
1,391
|
|
|
2,376
|
|
|
931
|
|
|
972
|
|
|
831
|
|
- Subscription
Services (I)
|
|
4,589
|
|
|
4,962
|
|
|
5,469
|
|
|
5,489
|
|
|
5,859
|
|
|
|
|
|
|
|
|
|
|
|
|
Games
|
|
|
|
|
|
|
|
|
|
|
- Subscription
Services (J)
|
|
2,528
|
|
|
2,589
|
|
|
2,705
|
|
|
2,730
|
|
|
2,770
|
|
- Product Sales
(K)
|
|
3,163
|
|
|
3,315
|
|
|
3,874
|
|
|
3,712
|
|
|
2,978
|
|
- Advertising &
Other (L)
|
|
908
|
|
|
975
|
|
|
1,032
|
|
|
1,023
|
|
|
889
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net
revenue
|
|
$
|
15,888
|
|
|
$
|
17,601
|
|
|
$
|
16,554
|
|
|
$
|
17,085
|
|
|
$
|
16,822
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue by
Geography
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
$
|
9,932
|
|
|
$
|
10,893
|
|
|
$
|
11,855
|
|
|
$
|
10,742
|
|
|
$
|
10,214
|
|
Rest of
world
|
|
5,956
|
|
|
6,708
|
|
|
4,699
|
|
|
6,343
|
|
|
6,608
|
|
Total net
revenue
|
|
$
|
15,888
|
|
|
$
|
17,601
|
|
|
$
|
16,554
|
|
|
$
|
17,085
|
|
|
$
|
16,822
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue by
Segment
|
|
|
|
|
|
|
|
|
|
(A) The Consumer
Media segment primarily includes revenue from the licensing of our
portfolio of video codec technologies. Also included is RealPlayer
and related products, such as the distribution of third-party
software products, advertising on RealPlayer websites, sales of
RealPlayer Plus software to consumers, and consumer subscriptions
such as RealPlayer Plus and SuperPass.
|
(B) The Mobile
Services segment primarily includes revenue from SaaS services and
sales of professional services provided to mobile
carriers.
|
(C) The Games segment
primarily includes revenue from player purchases of in-game virtual
goods within our free-to-play games, mobile and PC games, online
games subscription services, and advertising on games sites and
social network sites.
|
Net Revenue by
Product
|
|
|
|
|
|
|
|
|
|
|
(D) Software
licensing revenue within Consumer Media includes revenues from
licenses of our video codec technologies.
|
(E) Subscriptions
revenue within Consumer Media includes revenue from subscriptions
such as our RealPlayer Plus and SuperPass offerings.
|
(F) Product sales
within Consumer Media includes sales of RealPlayer Plus software to
consumers.
|
(G) Advertising &
other revenue within Consumer Media includes distribution of
third-party software products and advertising on RealPlayer
websites.
|
(H) Software license
revenue within Mobile Services includes revenue from our integrated
RealTimes platform and our facial recognition platform,
SAFR.
|
(I) Subscription
services revenue within Mobile Services includes revenue from our
messaging products, including Metcalf intercarrier messaging
services and Kontxt, as well as ringback tones and related
professional services provided to mobile carriers.
|
(J) Subscription
services revenue within Games includes revenue from online games
subscriptions.
|
(K) Product sales
revenue within Games includes revenue from player purchases of
in-game virtual goods, retail and wholesale games-related revenue,
sales of mobile games.
|
(L) Advertising &
other revenue within Games includes advertising on games sites and
social network sites.
|
RealNetworks, Inc.
and Subsidiaries
Segment Results of
Operations and Reconciliation to non-GAAP Contribution
Margin
(Unaudited)
|
|
|
|
2021
|
|
2020
|
|
|
Q1
|
|
Q4
|
|
Q1
|
|
|
(in
thousands)
|
Consumer
Media
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
$
|
3,309
|
|
|
$
|
3,384
|
|
|
$
|
3,495
|
|
Cost of
revenue
|
|
478
|
|
|
550
|
|
|
611
|
|
Gross
profit
|
|
2,831
|
|
|
2,834
|
|
|
2,884
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
86
|
%
|
|
84
|
%
|
|
83
|
%
|
|
|
|
|
|
|
|
Operating
expenses
|
|
2,201
|
|
|
2,135
|
|
|
2,458
|
|
Operating income
(loss), a GAAP measure
|
|
$
|
630
|
|
|
$
|
699
|
|
|
$
|
426
|
|
Depreciation and
amortization
|
|
16
|
|
|
17
|
|
|
13
|
|
|
|
|
|
|
|
|
Contribution margin, a
non-GAAP measure
|
|
$
|
646
|
|
|
$
|
716
|
|
|
$
|
439
|
|
|
|
|
|
|
|
|
Mobile
Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
$
|
5,980
|
|
|
$
|
7,338
|
|
|
$
|
6,690
|
|
Cost of
revenue
|
|
1,492
|
|
|
1,736
|
|
|
1,696
|
|
Gross
profit
|
|
4,488
|
|
|
5,602
|
|
|
4,994
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
75
|
%
|
|
76
|
%
|
|
75
|
%
|
|
|
|
|
|
|
|
Operating
expenses
|
|
6,145
|
|
|
5,940
|
|
|
7,588
|
|
Operating income
(loss), a GAAP measure
|
|
$
|
(1,657)
|
|
|
$
|
(338)
|
|
|
$
|
(2,594)
|
|
Depreciation and
amortization
|
|
84
|
|
|
130
|
|
|
98
|
|
|
|
|
|
|
|
|
Contribution margin, a
non-GAAP measure
|
|
$
|
(1,573)
|
|
|
$
|
(208)
|
|
|
$
|
(2,496)
|
|
|
|
|
|
|
|
|
Games
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
$
|
6,599
|
|
|
$
|
6,879
|
|
|
$
|
6,637
|
|
Cost of
revenue
|
|
1,705
|
|
|
1,744
|
|
|
1,794
|
|
Gross
profit
|
|
4,894
|
|
|
5,135
|
|
|
4,843
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
74
|
%
|
|
75
|
%
|
|
73
|
%
|
|
|
|
|
|
|
|
Operating
expenses
|
|
5,098
|
|
|
4,885
|
|
|
4,923
|
|
Operating income
(loss), a GAAP measure
|
|
$
|
(204)
|
|
|
$
|
250
|
|
|
$
|
(80)
|
|
Depreciation and
amortization
|
|
76
|
|
|
72
|
|
|
138
|
|
|
|
|
|
|
|
|
Contribution margin, a
non-GAAP measure
|
|
$
|
(128)
|
|
|
$
|
322
|
|
|
$
|
58
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
$
|
4
|
|
|
$
|
6
|
|
|
$
|
3
|
|
Gross
profit
|
|
(4)
|
|
|
(6)
|
|
|
(3)
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
N/A
|
|
N/A
|
|
N/A
|
|
|
|
|
|
|
|
Operating
expenses
|
|
4,960
|
|
|
(4,843)
|
|
|
2,584
|
|
Operating income
(loss), a GAAP measure
|
|
$
|
(4,964)
|
|
|
$
|
4,837
|
|
|
$
|
(2,587)
|
|
Other expense,
net
|
|
104
|
|
|
(227)
|
|
|
238
|
|
Foreign currency
(gain) loss
|
|
(103)
|
|
|
305
|
|
|
(210)
|
|
Depreciation and
amortization
|
|
28
|
|
|
28
|
|
|
31
|
|
Fair value
adjustments to contingent consideration liability
|
|
(1,040)
|
|
|
(8,400)
|
|
|
(300)
|
|
Restructuring and
other charges
|
|
3,171
|
|
|
1,432
|
|
|
86
|
|
Stock-based
compensation
|
|
836
|
|
|
327
|
|
|
380
|
|
|
|
|
|
|
|
|
Contribution margin, a
non-GAAP measure
|
|
$
|
(1,968)
|
|
|
$
|
(1,698)
|
|
|
$
|
(2,362)
|
|
RealNetworks, Inc.
and Subsidiaries
Reconciliation of
Net income (loss) from continuing operations to adjusted EBITDA, a
non-GAAP measure
(Unaudited)
|
|
|
|
2021
|
|
2020
|
|
|
Q1
|
|
Q4
|
|
Q1
|
|
|
(in
thousands)
|
|
|
|
|
|
|
|
Reconciliation of
GAAP Net income (loss) from continuing operations to adjusted
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
from continuing operations
|
|
$
|
(10,554)
|
|
|
$
|
5,972
|
|
|
$
|
(4,616)
|
|
Income tax expense
(benefit)
|
|
109
|
|
|
(551)
|
|
|
25
|
|
Interest
expense
|
|
95
|
|
|
8
|
|
|
—
|
|
Interest
income
|
|
(13)
|
|
|
(7)
|
|
|
(6)
|
|
(Gain) loss on equity
and other investments, net
|
|
4,272
|
|
|
(201)
|
|
|
—
|
|
Foreign currency
(gain) loss
|
|
(103)
|
|
|
305
|
|
|
(210)
|
|
Depreciation and
amortization
|
|
204
|
|
|
247
|
|
|
280
|
|
Fair value
adjustments to contingent consideration liability
|
|
(1,040)
|
|
|
(8,400)
|
|
|
(300)
|
|
Restructuring and
other charges
|
|
3,171
|
|
|
1,432
|
|
|
86
|
|
Stock-based
compensation
|
|
836
|
|
|
327
|
|
|
380
|
|
Adjusted
EBITDA, a non-GAAP measure
|
|
$
|
(3,023)
|
|
|
$
|
(868)
|
|
|
$
|
(4,361)
|
|
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SOURCE RealNetworks, Inc.