The Honest Company (NASDAQ: HNST), a digitally native,
mission-driven brand focused on leading the clean lifestyle
movement, reported first quarter 2021 financial results for the
period which ended March 31, 2021.
“We had a strong start to 2021, reporting double-digit sales
growth. This growth reflects the ongoing success of our strategic
initiatives focused on Content, Community and Commerce, powerful
innovation and category expansion,” said Nick Vlahos, Chief
Executive Officer of The Honest Company. “Honest is dedicated to
providing safe, clean and effective products to consumers around
the world and we are confident our strategy will help drive our
mission of inspiring everyone to love living consciously.”
“Since our founding, we have been laser-focused on listening to
the wants and needs of our consumers. As a result, over the last
several years, we have doubled down on expanding our business into
new areas, including skincare and beauty,” said Jessica Alba,
Founder and Chief Creative Officer of The Honest Company. “It is
energizing to see the success of our daily use skincare and beauty
products in the first quarter of 2021, driving strong growth in our
Skin and Personal Care product category. As we look to the future,
we will continue to use consumer insights to drive our focus on
current and future trends in self-care, clean beauty, and skincare
as well as our key product categories of Diapers and Wipes,
Household and Wellness.”
First Quarter 2021 Financial Results & Business
Highlights
|
For the three months ended March 31, |
|
2021 |
|
2020 |
|
2019 |
|
2021 vs 2020 |
|
2020 vs 2019 |
(In thousands, except
percentages) |
|
|
|
|
|
|
|
|
|
By Product Category |
|
|
|
|
|
|
|
|
|
Diapers and Wipes |
$ |
49,574 |
|
|
$ |
50,483 |
|
|
$ |
37,402 |
|
|
(2 |
)% |
|
35 |
% |
Skin and Personal Care |
26,245 |
|
|
18,482 |
|
|
11,373 |
|
|
42 |
% |
|
63 |
% |
Household and Wellness |
5,213 |
|
|
3,407 |
|
|
4,523 |
|
|
53 |
% |
|
(25 |
)% |
Total Revenue |
$ |
81,032 |
|
|
$ |
72,372 |
|
|
$ |
53,298 |
|
|
12 |
% |
|
36 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By Channel |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital |
$ |
42,461 |
|
|
$ |
41,496 |
|
|
$ |
33,751 |
|
|
2 |
% |
|
23 |
% |
Retail |
|
38,571 |
|
|
|
30,876 |
|
|
|
19,548 |
|
|
25 |
% |
|
58 |
% |
Total Revenue |
$ |
81,032 |
|
|
$ |
72,372 |
|
|
$ |
53,298 |
|
|
12 |
% |
|
36 |
% |
Revenue increased 12% to $81.0 million compared to the first
quarter of 2020 with strong double-digit growth even as compared to
a strong first quarter of 2020, when sales increased 36% to $72.4
million compared to the first quarter of 2019. The first quarter of
2020 included the impact of consumer stock-up activity related to
COVID-19. The increase in revenue for the first quarter of 2021
compared to the first quarter of 2020 was primarily a result of
strong volume growth in the Company’s Skin and Personal Care
products and in the Company’s sanitization and disinfecting
products introduced in Household and Wellness in the second half of
2020.
Revenue by product category for the first quarter of 2021
compared to the first quarter of 2020 was as follows:
- Diapers and Wipes: Revenue was slightly down as the Company
transitioned to its Clean Conscious Diaper and compared against a
strong first quarter of 2020 when sales increased 35% compared to
the first quarter of 2019, driven by higher diapers and wipes
consumption and stock-up during the initial stages of the COVID-19
pandemic. In the first quarter of 2021, the Company introduced its
breakthrough Clean Conscious Diaper which features a new wetness
indicator, better absorption, sustainably-harvested
totally-chlorine free fluff pulp and a 100% plant-based
backsheet.
- Skin and Personal Care: Revenue increased 42% driven by strong
volume growth across the Company’s Digital and Retail channels due
to continued investment in marketing innovation and our Content,
Community, Commerce marketing strategy. During the first quarter of
2021, we sold $3.4 million of legacy beauty inventory in
exchange for future marketing and transportation credits to support
the transition to our beauty re-stage launching in the third
quarter of 2021. Skin and Personal Care saw strong growth even as
compared to the first quarter of 2020 when revenue grew 63% as
compared to the first quarter of 2019.
- Household and Wellness: Revenue increased 53%, driven by sales
from the Company’s sanitization and disinfecting products that it
introduced in the second half of 2020. Household and Wellness
revenue significantly grew as compared to the first quarter of 2020
when revenue declined 25% compared to the first quarter of 2019,
driven by the discontinuation of non-core products in this product
category such as infant formula.
Digital channel revenue increased 2% to $42.5 million in the
first quarter of 2021 compared to the first quarter of 2020 with
continued growth after the acceleration in the Digital channel in
the first quarter of 2020 driven by the COVID-19 pandemic. Digital
channel revenue increased 23% to $41.5 million in the first quarter
of 2020 compared to the first quarter of 2019. Retail channel
revenue increased 25% to $38.6 million in the first quarter of 2021
compared to the first quarter of 2020 with strong growth as
consumers increasingly returned to in-person retail shopping.
Retail channel revenue increased 58% to $30.9 million in the first
quarter of 2020 compared to the first quarter of 2019. In the first
quarter of 2021, Digital channel revenue growth was driven by the
Company’s Content, Community, Commerce digital marketing strategy
and Retail channel revenue growth was driven by volume growth and
expanded distribution with the Company’s retail partners.
|
For the three months ended March 31, |
|
2021 |
|
2020 |
|
2021 vs 2020 |
(In thousands, except percentages) |
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
81,032 |
|
|
$ |
72,372 |
|
|
12 |
% |
Cost of revenue |
|
52,651 |
|
|
|
46,567 |
|
|
13 |
% |
Gross profit |
|
28,381 |
|
|
|
25,805 |
|
|
10 |
% |
Gross margin |
|
35 |
% |
|
|
36 |
% |
|
(1 |
)% |
Operating expenses |
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
16,697 |
|
|
|
14,706 |
|
|
14 |
% |
Marketing |
|
14,173 |
|
|
|
9,193 |
|
|
54 |
% |
Research and development |
|
1,646 |
|
|
|
1,166 |
|
|
41 |
% |
Total operating expenses |
|
32,516 |
|
|
|
25,065 |
|
|
30 |
% |
Operating income (loss) |
|
(4,135 |
) |
|
|
740 |
|
|
NM |
* |
Interest and other income
(expense), net |
|
(327) |
|
|
|
(159 |
) |
|
106 |
% |
Income (loss) before provision
for income taxes |
|
(4,462 |
) |
|
|
581 |
|
|
NM |
* |
Income tax provision |
|
22 |
|
|
|
22 |
|
|
— |
% |
Net income (loss) |
$ |
(4,484 |
) |
|
$ |
559 |
|
|
NM |
* |
*Results not meaningful.
Gross profit increased 10% to $28.4 million or 35% of revenue,
compared to $25.8 million or 36% of revenue in the first quarter of
2020. Gross margin decreased slightly in the first quarter of 2021
compared to the first quarter of 2020 primarily due to a more
normalized level of trade spend and higher input costs as compared
to the first quarter of 2020.
Operating expenses increased 30% to $32.5 million or 40% of
revenue, compared to $25.1 million or 35% of revenues in the first
quarter of 2020. The increase in operating expenses in the first
quarter of 2021 compared to the first quarter of 2020 is primarily
driven by increased marketing spend of $5.0 million, increased
selling, general, and administrative expense due to IPO-related
costs and other transaction-related expenses, as well as increased
research and development expense due to the Company’s investment in
product innovation.
Operating loss for the quarter was $4.1 million, compared to
operating income of $0.7 million in the first quarter of 2020.
Net loss for the quarter was $4.5 million, compared to net
income of $0.6 million in the first quarter of 2020.
Adjusted EBITDA was $(0.1) million compared to $4.5 million in
the first quarter of 2020. Please see the reconciliation of
adjusted EBITDA, a non-GAAP financial measure, from the GAAP
financial measure in the tables at the end of this press
release.
Balance Sheet Highlights
The Company ended the first quarter 2021 with $58.1 million in
cash, cash equivalents, short-term investments and short and
long-term restricted cash, a decrease of $13.6 million compared to
December 31, 2020.
Inventories, net at the end of first quarter 2021 totaled $75.7
million compared to $76.7 million as of December 31, 2020.
Initial Public Offering
On May 4, 2021 the Company completed its initial public offering
of 25,807,000 shares of common stock at a public offering price of
$16.00 per share. The Company sold 6,451,613 shares of common stock
and the selling stockholders sold 23,226,437 shares of common stock
(including 3,871,050 shares sold pursuant to the underwriters’
over-allotment option). The Company did not receive any proceeds
from the sale of shares by the selling stockholders. Total net
proceeds to the Company were approximately $91.1 million, net of
underwriters’ discounts and commissions and other offering expenses
of $12.1 million.
Immediately prior to the completion of the IPO, the Company
filed an Amended and Restated Certificate of Incorporation, which
authorized a total of 1,000,000,000 shares of common stock and
20,000,000 shares of preferred stock. Upon the filing of the
Amended and Restated Certificate of Incorporation, 49,100,928
shares of the Company’s redeemable convertible preferred stock then
outstanding were automatically converted into 49,649,023 shares of
the Company’s common stock. Net loss per diluted share attributable
to common stockholders was $0.13 per share and on a non-GAAP basis,
reflecting the conversion of redeemable convertible preferred
stock, was $0.05 for the first quarter of 2021. Please see the
reconciliation of non-GAAP net loss per share, a non-GAAP financial
measure, from the GAAP financial measure in the tables at the end
of this press release.
Webcast and Conference Call Information
A webcast and conference call to discuss first quarter 2021
results is scheduled for today, June 16, 2021, at 2:00 p.m. Pacific
time/5:00 p.m. Eastern time. Those interested in participating in
the conference call are invited to dial (855) 940-5313 or (929)
517-0417, if calling internationally. A live webcast of the
conference call will be available online at:
https://investors.honest.com. A replay of the webcast will remain
available on the website for 90 days.
Forward Looking Statements
This press release and earnings call referencing this press
release contain forward-looking statements about us and our
industry that involve substantial risks and uncertainties. All
statements other than statements of historical facts contained in
this press release, including statements regarding our future
results of operations or financial condition, business strategy and
plans and objectives of management for future operations, are
forward-looking statements. In some cases, you can identify
forward-looking statements because they contain words such as
“anticipate,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “potential,”
“predict,” “project,” “should,” “target,” “will” or “would” or the
negative of these words or other similar terms or expressions.
These forward-looking statements include, but are not limited to,
statements concerning the following:
- our expectations regarding our
revenue and adjusted EBITDA and other operating results;
- our strategic initiatives and
priorities, including the timing and cadence of marketing and
product innovation;
- our ability to effectively manage our growth;
- our ability to acquire new consumers and successfully retain
existing consumers;
- anticipated trends, growth rates and challenges in our business
and in the markets in which we operate;
- the effect of COVID-19 or other public health crises on our
business and the global economy, including the shift from our
Digital channel to our Retail channel as consumers get vaccinated
and return to in-store shopping;
- our continued revenue growth through omnichannel strategy and
ability to capture growth in whitespace opportunities in our Retail
channel;
- expectations regarding consumer demand and the timing and
amount of orders from key customers; and
- our ability to achieve or sustain profitability.
You should not rely on forward-looking statements as predictions
of future events. We have based the forward-looking statements
contained in this press release primarily on our current
expectations and projections about future events and trends that we
believe may affect our business, financial condition and operating
results.
The outcome of the events described in these forward-looking
statements is subject to risks, uncertainties and other factors
described in the section titled “Risk Factors” in the prospectus
for our IPO, filed on May 6, 2021, and subsequent filings with the
Securities and Exchange Commission. New risks and uncertainties
emerge from time to time, and it is not possible for us to predict
all risks and uncertainties that could have an impact on the
forward-looking statements contained in this press release or the
earnings call referencing this press release. The results, events
and circumstances reflected in the forward-looking statements may
not be achieved or occur, and actual results, events or
circumstances could differ materially from those described in the
forward-looking statements.
In addition, statements that contain “we believe” and similar
statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us
as of the date of this press release. While we believe that
information provides a reasonable basis for these statements, that
information may be limited or incomplete. Our statements should not
be read to indicate that we have conducted an exhaustive inquiry
into, or review of, all relevant information. These statements are
inherently uncertain, and investors are cautioned not to unduly
rely on these statements.
The forward-looking statements made in this press release and
the earnings call referencing this press release relate only to
events as of the date on which the statements are made. We
undertake no obligation to update any forward-looking statements
made in this press release to reflect events or circumstances after
the date of this press release or to reflect new information or the
occurrence of unanticipated events, except as required by law. We
may not actually achieve the plans, intentions or expectations
disclosed in our forward-looking statements, and you should not
place undue reliance on our forward-looking statements. Our
forward-looking statements do not reflect the potential impact of
any future acquisitions, mergers, dispositions, joint ventures or
investments.
About The Honest Company
The Honest Company (NASDAQ: HNST) is a mission-driven,
digitally-native brand focused on leading the clean lifestyle
movement, creating a community for conscious consumers and seeking
to disrupt multiple consumer product categories. Since its launch
in 2012, Honest has been dedicated to creating thoughtfully
formulated, safe and effective personal care, beauty, baby and
household products, which are available via honest.com, third-party
ecommerce partners and approximately 32,000 retail locations across
the United States, Canada and Europe. Based in Los Angeles, CA, the
Company’s mission, to inspire everyone to love living consciously,
is driven by its values of transparency, trust, sustainability and
a deep sense of purpose around what matters most to its consumers:
their health, their families and their homes. For more information
about the Honest Standard and the Company, please visit
www.honest.com.
Investor
Contact:
ICR, Inc.Allison Malkin/Tina
RomaniInvestors@honest.com203-682-8225
Media
Contact: Jennifer
Kroog Rosenbergjrosenberg@thehonestcompany.com
|
The Honest Company, Inc.Condensed
Consolidated Statements of Comprehensive Income
(Loss)(Unaudited)(in thousands, except share and per share
amounts) |
|
|
|
For the three months ended March 31, |
|
2021 |
|
2020 |
|
|
|
|
Revenue |
$ |
81,032 |
|
|
$ |
72,372 |
|
Cost of revenue |
52,651 |
|
|
46,567 |
|
Gross profit |
28,381 |
|
|
25,805 |
|
Operating expenses |
|
|
|
|
|
|
|
Selling, general and administrative |
16,697 |
|
|
14,706 |
|
Marketing |
14,173 |
|
|
9,193 |
|
Research and development |
1,646 |
|
|
1,166 |
|
Total operating expenses |
32,516 |
|
|
25,065 |
|
Operating income (loss) |
(4,135 |
) |
|
740 |
|
Interest and other expense,
net |
(327 |
) |
|
(159 |
) |
Income (loss) before provision
for income taxes |
(4,462 |
) |
|
581 |
|
Income tax provision |
22 |
|
|
22 |
|
Net income (loss) |
$ |
(4,484 |
) |
|
$ |
559 |
|
Net income (loss) per share
attributable to common stockholders: |
|
|
|
Basic |
$ |
(0.13 |
) |
|
$ |
0.01 |
|
Diluted |
$ |
(0.13 |
) |
|
$ |
0.01 |
|
Weighted-average shares used
in computing net income (loss)per share attributable to common
stockholders: |
|
|
|
|
|
|
|
Basic |
34,102,123 |
|
|
34,061,001 |
|
Diluted |
34,102,123 |
|
|
34,706,987 |
|
|
|
|
|
Other comprehensive income
(loss) |
|
|
|
Unrealized gain (loss) on short-term investments, net of taxes |
(82 |
) |
|
(7 |
) |
Comprehensive income (loss) |
$ |
(4,566 |
) |
|
$ |
552 |
|
|
|
|
|
|
|
|
|
The Honest Company, Inc.Condensed
Consolidated Balance Sheets(in thousands, except share and
per share amounts) |
|
|
|
|
|
March 31, 2021 |
|
December 31, 2020 |
|
(Unaudited) |
|
|
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ |
39,013 |
|
|
$ |
29,259 |
|
Restricted cash |
1,417 |
|
|
1,752 |
|
Short-term investments |
12,428 |
|
|
34,425 |
|
Accounts receivable, net |
27,712 |
|
|
22,795 |
|
Inventories, net |
75,738 |
|
|
76,669 |
|
Prepaid expenses and other current assets |
7,492 |
|
|
8,657 |
|
Total current assets |
163,800 |
|
|
173,557 |
|
Restricted cash, net of
current portion |
5,210 |
|
|
6,189 |
|
Property and equipment,
net |
55,711 |
|
|
56,703 |
|
Goodwill |
2,230 |
|
|
2,230 |
|
Intangible assets, net |
493 |
|
|
511 |
|
Other assets |
7,133 |
|
|
1,542 |
|
Total assets |
$ |
234,577 |
|
|
$ |
240,732 |
|
Liabilities,
Redeemable Convertible Preferred Stock and Stockholders’
Deficit |
|
|
|
Current liabilities |
|
|
|
Accounts payable |
$ |
29,015 |
|
|
$ |
31,132 |
|
Accrued expenses |
21,009 |
|
|
22,222 |
|
Deferred revenue |
805 |
|
|
716 |
|
Total current liabilities |
50,829 |
|
|
54,070 |
|
Long term liabilities |
|
|
|
Lease financing obligation, net of current portion |
38,206 |
|
|
38,426 |
|
Other long-term liabilities |
8,658 |
|
|
8,657 |
|
Total liabilities |
97,693 |
|
|
101,153 |
|
Commitments and
contingencies |
|
|
|
Redeemable convertible
preferred stock |
376,404 |
|
|
376,404 |
|
Stockholders’ deficit |
|
|
|
Common stock |
3 |
|
|
3 |
|
Additional paid-in capital |
117,926 |
|
|
116,055 |
|
Accumulated deficit |
(357,461 |
) |
|
(352,977 |
) |
Accumulated other comprehensive income |
12 |
|
|
94 |
|
Total stockholders’ deficit |
(239,520 |
) |
|
(236,825 |
) |
Total liabilities, redeemable convertible preferred stock and
stockholders’ deficit |
$ |
234,577 |
|
|
$ |
240,732 |
|
|
|
|
|
|
|
|
|
The Honest Company, Inc.Condensed
Consolidated Statements of Cash Flows(Unaudited)(in
thousands) |
|
|
|
For the three months ended March 31, |
|
2021 |
|
2020 |
Cash flows from
operating activities |
|
|
|
Net income (loss) |
$ |
(4,484 |
) |
|
$ |
559 |
|
Adjustments to reconcile net
income (loss) to net cash used in operating activities |
|
|
|
Depreciation and amortization |
1,090 |
|
|
1,229 |
|
Stock-based compensation |
1,838 |
|
|
1,923 |
|
Other |
57 |
|
|
15 |
|
Changes in assets and liabilities |
|
|
|
Accounts receivable, net |
(4,917 |
) |
|
(9,617 |
) |
Inventories |
931 |
|
|
5,455 |
|
Prepaid expenses and other assets |
(967 |
) |
|
(1,534 |
) |
Accounts payable, accrued expenses and other long-term
liabilities |
(5,600 |
) |
|
447 |
|
Deferred revenue |
88 |
|
|
(141 |
) |
Net cash used in operating activities |
(11,964 |
) |
|
(1,664 |
) |
Cash flows from
investing activities |
|
|
|
Purchases of short-term
investments |
(301 |
) |
|
(4,459 |
) |
Proceeds from sales of
short-term investments |
13,638 |
|
|
5,580 |
|
Proceeds from maturities of
short-term investments |
8,523 |
|
|
17,644 |
|
Purchases of property and
equipment |
(74 |
) |
|
(25 |
) |
Net cash provided by investing activities |
21,786 |
|
|
18,740 |
|
Cash flows from
financing activities |
|
|
|
Proceeds from exercise of
stock options |
33 |
|
|
13 |
|
Payment of deferred IPO
costs |
(1,133 |
) |
|
— |
|
Payments on lease
obligations |
(282 |
) |
|
(246 |
) |
Net cash used in financing activities |
(1,382 |
) |
|
(233 |
) |
Net increase in cash, cash equivalents and restricted cash |
8,440 |
|
|
16,843 |
|
Cash, cash equivalents
and restricted cash |
|
|
|
Beginning of the period |
37,200 |
|
|
13,543 |
|
End of the period |
$ |
45,640 |
|
|
$ |
30,386 |
|
|
|
|
|
Reconciliation of
cash, cash equivalents and restricted cash to the consolidated
balance sheets |
|
|
|
Cash and cash equivalents |
$ |
39,013 |
|
|
$ |
30,386 |
|
Restricted cash, current |
1,417 |
|
|
— |
|
Restricted cash, non-current |
5,210 |
|
|
— |
|
Total cash, cash equivalents and restricted cash |
$ |
45,640 |
|
|
$ |
30,386 |
|
|
|
|
|
Supplemental
disclosures of noncash activities |
|
|
|
Equipment acquired under
capital lease obligations |
$ |
40 |
|
|
$ |
— |
|
Deferred IPO costs included in
accounts payable and accrued expenses |
2,323 |
|
|
— |
|
Capital expenditures included
in accounts payable and accrued expenses |
13 |
|
|
— |
|
|
|
|
|
|
|
The Honest Company,
Inc.Use of Non-GAAP Financial
Measures
We prepare and present our condensed consolidated financial
statements in accordance with GAAP. However, management believes
that adjusted EBITDA and non-GAAP net loss per share, which are
non-GAAP financial measures, provide investors with additional
useful information in evaluating our performance.
We calculate adjusted EBITDA as net income (loss), adjusted to
exclude: (1) interest and other (income) expense, net;
(2) income tax provision; (3) depreciation and
amortization; (4) stock-based compensation expense;
(5) professional fees and expenses and executive termination
expenses related to our Innovation Strategy; (6) litigation
and settlement fees associated with certain non-ordinary course
litigation; and (7) the IPO Bonuses, including associated
payroll taxes and expenses, and third-party costs associated with
our IPO. We calculate non-GAAP net loss per share as net loss
divided by the weighted average shares of common stock outstanding
adjusted to give effect to the automatic conversion of 49,100,928
shares of the Company’s redeemable convertible preferred stock in
49,649,023 shares of common stock in connection with our IPO.
Adjusted EBITDA and non-GAAP net loss per share are financial
measures that are not required by, or presented in accordance with
GAAP. We believe that adjusted EBITDA, when taken together with our
financial results presented in accordance with GAAP, provides
meaningful supplemental information regarding our operating
performance and facilitates internal comparisons of our historical
operating performance on a more consistent basis by excluding
certain items that may not be indicative of our business, results
of operations or outlook. In particular, we believe that the use of
adjusted EBITDA is helpful to our investors as it is a measure used
by management in assessing the health of our business, determining
incentive compensation and evaluating our operating performance, as
well as for internal planning and forecasting purposes.
Additionally, we believe that non-GAAP net loss per share provides
investors and securities analysts useful information to evaluate
the one-time impact of the conversion of our redeemable convertible
preferred stock to common stock that occurred in conjunction with
our IPO and the comparability of our weighted average shares of
common stock outstanding on a go forward basis.
Adjusted EBITDA and non-GAAP net loss per share are presented
for supplemental informational purposes only, have limitations as
analytical tools and should not be considered in isolation or as a
substitute for financial information presented in accordance with
GAAP. Some of the limitations of adjusted EBITDA include that
(1) it does not reflect capital commitments to be paid in the
future, (2) although depreciation and amortization are
non-cash charges, the underlying assets may need to be replaced and
adjusted EBITDA does not reflect these capital expenditures,
(3) it does not consider the impact of stock-based
compensation expense, (4) it does not reflect other
non-operating expenses, including interest expense, (5) it
does not include the IPO Bonuses, including associated payroll
taxes and expenses, or third-party costs associated with the
preparation of the IPO, (6) it does not reflect tax payments
that may represent a reduction in cash available to us, and
(7) does not include certain non-ordinary cash expenses that
we do not believe are representative of our business on a
steady-state basis. In addition, our use of adjusted EBITDA and
non-GAAP net loss per share may not be comparable to similarly
titled measures of other companies because they may not calculate
adjusted EBITDA or non-GAAP net loss per share in the same manner,
limiting its usefulness as a comparative measure. Because of these
limitations, when evaluating our performance, you should consider
adjusted EBITDA and non-GAAP net loss per share alongside other
financial measures, including our net income (loss) and other
results stated in accordance with GAAP.
The following table presents a reconciliation of net income
(loss), the most directly comparable financial measure stated in
accordance with GAAP, to adjusted EBITDA, for each of the periods
presented:
|
For the three months ended March 31, |
(In thousands) |
2021 |
|
2020 |
|
2019 |
Reconciliation of Net Income (Loss) to Adjusted
EBITDA |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
(4,484 |
) |
|
$ |
559 |
|
|
$ |
(10,957 |
) |
Interest and other (income) expense, net |
327 |
|
|
159 |
|
|
(231 |
) |
Income tax provision |
22 |
|
|
22 |
|
|
14 |
|
Depreciation and amortization |
1,090 |
|
|
1,229 |
|
|
2,139 |
|
Stock-based compensation |
1,838 |
|
|
1,923 |
|
|
2,376 |
|
Innovation Strategy expenses(1) |
— |
|
|
571 |
|
|
1,387 |
|
Related IPO costs and other transaction-related expenses(2) |
1,075 |
|
|
— |
|
|
— |
|
Non-ordinary course litigation
expenses(3) |
— |
|
|
— |
|
|
214 |
|
Adjusted EBITDA |
$ |
(132 |
) |
|
$ |
4,463 |
|
|
$ |
(5,058 |
) |
(1) |
Includes
professional fees and expenses and executive severance and
termination expenses related to our Innovation Strategy. |
(2) |
Includes related IPO costs and other transaction-related
third-party expenses, which are generally incremental costs
incurred associated with the preparation of the IPO. |
(3) |
Includes third-party costs associated with the preparation of
our IPO. |
|
|
The following table presents a reconciliation of net loss per
share, the most directly comparable financial measure stated in
accordance with GAAP, to non-GAAP net loss per share, for the
period presented:
|
For the three months ended March 31, 2021 |
(In thousands, except for
share and per share values) |
GAAP |
|
Conversion of Redeemable Preferred Stock |
|
Non-GAAP |
Net loss attributable to common stockholders - basic and
diluted |
$ |
(4,484 |
) |
|
$ |
— |
|
|
$ |
(4,484 |
) |
Weighted average shares of
common stock outstanding - basic and diluted |
34,102,123 |
|
|
49,649,023 |
|
|
83,751,146 |
|
Net loss per share,
attributable to common shareholders: |
|
|
|
|
|
Basic and diluted |
$ |
(0.13 |
) |
|
|
|
$ |
(0.05 |
) |
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