Fourth quarter Platform+ net revenue increased
74% year-over-year to $105.1 million
SmartCast Active accounts increased 24%
year-over-year to 15.1 million
Average Revenue Per User increased 67%
year-over-year to $21.68
VIZIO Holding Corp. (NYSE: VZIO) today announced
the following results for the three and twelve months ended
December 31, 2021, as compared to the corresponding period of last
year:
Financial and operating results for the fourth quarter ended
December 31, 2021 as compared to the corresponding period of last
year included:
- Net revenue of $628.8 million, compared to $734.3 million
- Platform+ net revenue grew 74% to $105.1 million
- Gross profit of $77.1 million, compared to $101.9 million
- Platform+ gross profit increased 39% to $67.3 million
- SmartCast Active Accounts grew 24% to 15.1 million
- SmartCast Hours increased 11% to 3.9 billion
- Average Revenue Per User (ARPU) grew 67% to $21.68
Financial and operating results for the year ended December 31,
2021 as compared to the corresponding period of last year
included:
- Net revenue increased 4% to $2.1 billion
- Platform+ net revenue grew 110% to $308.7 million
- Gross profit increased 10% to $326.3 million
- Platform+ gross profit grew 88% to $210.6 million
- SmartCast Hours increased 26% to 14.6 billion
“2021 was a transformational year for VIZIO. Since our IPO
almost one year ago, we have continued to see success in the
execution of our combined hardware and software strategy,” said
William Wang CEO of VIZIO. “Our dual revenue model has allowed us
the flexibility to invest in creating an even better consumer
experience with great products, while our advertising and data
offerings increasingly draw partners to our streaming platform.
Going forward we will continue to focus on execution on all sides
of the business, and we are excited for the year ahead as we
celebrate our 20th Anniversary in the TV market.”
Fourth quarter 2021 business highlights include:
- Returned to pre-pandemic stock levels which lead to healthier
inventory positions across retail partners
- Expanded number of gaming TVs shipped with FreeSync
certification
- Increased our direct ad client base by 20%+ and our average
revenue per advertiser by 70%+ versus Q4'20
- Grew relationships with ad categories like Auto, Media &
Entertainment, Insurance, and Retail versus Q4'20
- Expanded WatchFree+ with thousands of free on demand movies, TV
shows and VIZIO exclusives
- App launches included Discovery+, History Vault, Lifetime Movie
Club, AfroLandTV, and Crime Central
- Launched more VIZIO Features (Mission, House and Fear) curated
channels with 100% ad inventory control
Selected Financial Results
(Unaudited, in millions, except
percentages and ARPU)
Quarter Ended
December 31,
Year Ended
December 31,
Quarter
Full Year
2021
2020
2021
2020
QTD %
YTD %
Financial
Highlights
Revenue
Device
$
523.7
$
674.0
$
1,815.3
$
1,895.3
(22
)%
(4
)%
Platform+
105.1
60.3
308.7
147.2
74
%
110
%
Total Revenue
628.8
734.3
2,124.0
2,042.5
(14
)%
4
%
Gross Profit
Device
9.8
53.6
115.7
184.5
(82
)%
(37
)%
Platform+
67.3
48.3
210.6
111.9
39
%
88
%
Total Gross Profit
77.1
101.9
326.3
296.4
(24
)%
10
%
Operating Expenses
97.2
48.8
355.9
164.5
99
%
116
%
Net (loss) Income
$
(10.1
)
$
40.8
$
(39.4
)
$
102.5
(125
)%
(138
)%
Adjusted EBITDA (1)
$
17.3
$
54.4
$
107.6
$
139.0
(68
)%
(23
)%
Operational
Metrics
Smart TV Shipments
1.5
2.2
5.5
7.1
(31
)%
(22
)%
SmartCast Active Accounts (as of)
15.1
12.2
15.1
12.2
24
%
24
%
VIZIO Hours
7,915
6,577
29,337
23,264
20
%
26
%
SmartCast Hours
3,851
3,469
14,598
11,596
11
%
26
%
SmartCast ARPU (2)
$
21.68
$
12.99
$
21.68
$
12.99
67
%
67
%
________________________
(1) A reconciliation of Net (loss) income
to Adjusted EBITDA is provided below
(2) As of December 31 and based on the
preceding four quarters
Financial Outlook
(In millions)
First Quarter
2022
Platform+ Net Revenue
$90 - $95
Platform+ Gross Profit
$57 - $60
Adjusted EBITDA
$(2) - $2
Virtual Investor Event – Thursday, March 3, 2022
VIZIO management will hold a live question and answer
webcast at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to
discuss VIZIO's quarterly results and outlook. To listen to the
webcast please visit this link. Following the live audio webcast, a
playback will be available on VIZIO's Investor Relations website
(investors.vizio.com) through April 30, 2022 at 11:59 p.m.
(ET).
About VIZIO
Founded and headquartered in Orange County, California, VIZIO’s
mission is to deliver immersive entertainment and compelling
lifestyle enhancements that make our products the center of the
connected home. VIZIO is driving the future of televisions through
its integrated platform of cutting-edge Smart TVs and powerful
SmartCast operating system. VIZIO also offers a portfolio of
innovative sound bars that deliver consumers an elevated audio
experience. VIZIO’s platform gives content providers more ways to
distribute their content and advertisers more tools to target and
dynamically serve ads to a growing audience that is increasingly
transitioning away from linear TV.
Supplemental Financial and Other Information
Supplemental financial and other information can be accessed
through VIZIO’s Investor Relations website at investors.vizio.com.
VIZIO announces material information to the public about VIZIO, its
products and services, and other matters through a variety of
means, including filings with the Securities and Exchange
Commission, press releases, public conference calls, webcasts, its
Investor Relations website (investors.vizio.com), its blog
(accessible via vizio.com/en/newsroom) and its Twitter account
(@VIZIO) in order to achieve broad, non-exclusionary distribution
of information to the public and for complying with its disclosure
obligations under Regulation FD.
Key Operational and Financial Metrics
We review certain key operational and financial metrics to
evaluate our business, measure our performance, identify trends
affecting our business, formulate business plans and make strategic
decisions. We regularly review and may adjust our processes for
calculating our internal metrics to improve their accuracy.
Smart TV Shipments. We define Smart TV Shipments as the
number of Smart TV units shipped to retailers or direct to
consumers in a given period. Smart TV Shipments currently drive the
majority of our revenue and provide the foundation for increased
adoption of our SmartCast operating system and the growth of our
Platform+ revenue. The growth rate between Smart TV units shipped
and Device net revenue is not directly correlated because VIZIO’s
Device net revenue can be impacted by other variables, such as the
series and sizes of Smart TVs sold during the period, the
introduction of new products as well as the number of sound bars
shipped.
SmartCast Active Accounts. We define SmartCast Active
Accounts as the number of VIZIO Smart TVs where a user has
activated the SmartCast operating system through an internet
connection at least once in the past 30 days. We believe that the
number of SmartCast Active Accounts is an important metric to
measure the size of our engaged user base, the attractiveness and
usability of our operating system, and subsequent monetization
opportunities to increase our Platform+ net revenue.
Total VIZIO Hours. We define Total VIZIO Hours as the
aggregate amount of time users spend utilizing our Smart TVs in any
capacity. We believe this usage metric is critical to understanding
our total potential monetization opportunities.
SmartCast Hours. We define SmartCast Hours as the
aggregate amount of time viewers engage with our SmartCast platform
to stream content or access other applications. This metric
reflects the size of the audience engaged with our operating system
as well as indicates the growth and awareness of our platform. It
is also a measure of the success of our offerings in addressing
increased user demand for OTT streaming. Greater user engagement
translates into increased revenue opportunities as we earn a
significant portion of our Platform+ net revenue through
advertising, which is influenced by the amount of time users spend
on our platform.
SmartCast ARPU. We define SmartCast ARPU as total
Platform+ net revenue, less revenue attributable to legacy VIZIO
V.I.A. Plus units, during the preceding four quarters divided by
the average of (i) the number of SmartCast Active Accounts at the
end of the current period; and (ii) the number of SmartCast Active
Accounts at the end of the corresponding prior year period.
SmartCast ARPU indicates the level at which we are monetizing our
SmartCast Active Account user base. Growth in SmartCast ARPU is
driven significantly by our ability to add users to our platform
and our ability to monetize those users.
Device gross profit. We define Device gross profit as
Device net revenue less Device cost of goods sold in a given
period. Device gross profit is directly influenced by consumer
demand, device offerings, and our ability to maintain a
cost-efficient supply chain.
Platform+ gross profit. We define Platform+ gross profit
as Platform+ net revenue less Platform+ cost of goods sold in a
given period. As we continue to grow and scale our business, we
expect Platform+ gross profit to increase over the long term.
Non-GAAP Financial Measures
To supplement our financial information presented in accordance
with generally accepted accounting principles in the United States
of America, or GAAP, VIZIO considers certain financial measures
that are not prepared in accordance with GAAP, including Adjusted
EBITDA. We define Adjusted EBITDA as total net (loss) income before
interest income, other income, provision for income taxes,
depreciation and amortization and share-based compensation. We
consider Adjusted EBITDA to be an important metric to assess our
operating performance and help us to manage our working capital
needs. Utilizing Adjusted EBITDA, we can identify and evaluate
trends in our business as well as provide investors with
consistency and comparability to facilitate period-to-period
comparisons of our business. We believe that providing users with
non-GAAP measures such as Adjusted EBITDA may assist investors in
seeing VIZIO’s operating results through the eyes of management and
in comparing VIZIO’s operating results over multiple periods with
other companies in our industry.
We use Adjusted EBITDA in conjunction with net (loss) income as
part of our overall assessment of our operating performance and the
management of our working capital needs. Our definition of Adjusted
EBITDA may differ from the definition used by other companies and
therefore comparability may be limited. In addition, other
companies may not publish Adjusted EBITDA or similar metrics.
Furthermore, Adjusted EBITDA has certain limitations in that it
does not include the impact of certain expenses that are reflected
in our consolidated statement of operations that are necessary to
run our business. Thus, Adjusted EBITDA should be considered in
addition to, not as a substitute for, or in isolation from,
measures prepared in accordance with GAAP, including net (loss)
income.
We compensate for these limitations by providing a
reconciliation of Adjusted EBITDA to net (loss) income. We
encourage investors and others not to rely on any single financial
measure and to view Adjusted EBITDA in conjunction with net (loss)
income.
Forward-looking information
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements generally relate to future events or VIZIO’s future
financial or operating performance. In some cases, you can identify
forward looking statements because they contain words such as
“may,” “will,” “should,” “expects,” “plans,” “anticipates,” “going
to,” “could,” “intends,” “target,” “projects,” “contemplates,”
“believes,” “estimates,” “predicts,” “potential,” or “continue,” or
the negative of these words or other similar terms or expressions
that concern our expectations, strategy, priorities, plans, or
intentions.
Forward-looking statements in this press release include, but
are not limited to, statements regarding VIZIO’s future financial
and operating performance, including our outlook and guidance, and
our expectations regarding advertising spend commitments. Our
expectations and beliefs regarding these matters may not
materialize, and actual results in future periods are subject to
risks and uncertainties, including changes in our plans or
assumptions, that could cause actual results to differ materially
from those projected. These risks include the possibility that: we
are not able to keep pace with technological advances in our
industry and successfully compete in highly competitive markets; we
do not have the ability to continue to sell our Smart TVs; we
cannot attract and maintain SmartCast Active Accounts; we cannot
increase SmartCast Hours; we are not able to attract and maintain
popular content on our platform; we are not able to maintain
relationships with advertisers; and we cannot adapt to market
conditions and technological developments, including with respect
to our platform's compatibility with applications developed by
content providers.
The forward-looking statements contained in this press release
are also subject to other risks and uncertainties, including those
more fully described in our filings with the Securities and
Exchange Commission, including our prospectus filed pursuant to
Rule 424(b) under the Securities Act of 1933, as amended, on March
25, 2021, and in our Quarterly Reports on Form 10-Q filed on May
12, 2021, August 5, 2021, and November 10, 2021. Additional
information will also be set forth in our Annual Report on Form
10-K for the fiscal year ended December 31, 2021. The
forward-looking statements in this press release are based on
information available to VIZIO as of the date hereof, and VIZIO
disclaims any obligation to update any forward-looking statements,
except as required by law.
VIZIO HOLDING CORP.
Consolidated Statement of
Operations
(Unaudited, in millions, except
share and per share amounts)
Year Ended
December 31,
2021
2020
2019
Net revenue:
Device
$
1,815.3
$
1,895.3
$
1,773.6
Platform+
308.7
147.2
63.2
Total net revenue
2,124.0
2,042.5
1,836.8
Cost of goods sold:
Device
1,699.6
1,710.8
1,648.6
Platform+
98.1
35.3
23.0
Total cost of goods sold
1,797.7
1,746.1
1,671.6
Gross profit:
Device
115.7
184.5
125.0
Platform+
210.6
111.9
40.2
Total gross profit
326.3
296.4
165.2
Operating expenses:
Selling, general and administrative
286.1
115.8
98.7
Marketing
32.8
31.3
22.7
Research & development
34.2
15.1
10.3
Depreciation and amortization
2.8
2.3
4.1
Total operating expenses
355.9
164.5
135.8
Income (loss) from operations
(29.6
)
131.9
29.4
Interest income, net
0.3
—
1.2
Other income, net
3.0
0.5
0.2
Total non-operating income
3.3
0.5
1.4
Income (loss) before income taxes
(26.3
)
132.4
30.8
Provision for income taxes
13.1
29.9
7.7
Net (loss) income
$
(39.4
)
$
102.5
$
23.1
Net (loss) income per share attributable
to common stockholders
Basic
$
(0.22
)
$
0.56
$
0.12
Diluted
$
(0.22
)
$
0.55
$
0.12
Weighted-average common shares outstanding
(in thousands)
Basic
175,502
144,381
144,127
Diluted
175,502
147,012
147,063
VIZIO HOLDING CORP.
Consolidated Balance
Sheets
(Unaudited, in millions except
share amounts in thousands)
As of
December 31,
2021
2020
Assets
Current assets:
Cash and cash equivalents
$
331.6
$
207.7
Accounts receivable, net
375.1
405.6
Other receivables due from related
parties
5.1
1.0
Inventories
11.9
10.5
Income tax receivable
26.2
1.3
Other current assets
84.8
55.5
Total current assets
834.7
681.6
Property, equipment and software, net
10.3
7.9
Goodwill
44.8
44.8
Deferred income taxes
30.4
26.7
Other assets
15.6
14.0
Total assets
$
935.8
$
775.0
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable due to related
parties
$
224.8
$
209.4
Accounts payable
118.9
166.8
Accrued expenses
185.8
155.0
Accrued royalties
56.8
81.1
Other current liabilities
4.8
5.2
Total current liabilities
591.1
617.5
Other long-term liabilities
14.1
8.2
Total liabilities
605.2
625.7
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value;
100,000 shares authorized in March 2021, no shares issued and
outstanding as of December 31, 2021
—
—
Series A convertible preferred stock,
$0.0001 par value; 25,000 shares authorized; 0 and 250 shares
designated and 0 and 135 shares issued and outstanding as of
December 31, 2021 and 2020, respectively
—
2.6
Common stock, $0.0001 par value; 1,350,000
and 675,000 shares authorized as of December 31, 2021 and 2020,
respectively:
- Class A, 116,258 and 150,831 shares issued and 113,209 and
150,831 outstanding as of December 31, 2021 and 2020,
respectively
- Class B, 76,815 and 0 shares issued and outstanding as of
December 31, 2021 and 2020, respectively
- Class C, no shares issued and outstanding as of December 31
2021 and 2020, respectively
—
—
Additional paid in capital
323.3
98.9
Accumulated other comprehensive (loss)
income
(0.2
)
0.9
Retained earnings
7.5
46.9
Total stockholders’ equity
330.6
149.3
Total liabilities and stockholders’
equity
$
935.8
$
775.0
VIZIO HOLDING CORP.
Consolidated Statement of Cash
Flows
(Unaudited, in millions)
Year Ended December
31,
2021
2020
2019
Cash flows from operating
activities:
Net (loss) income
$
(39.4
)
$
102.5
$
23.1
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization
2.8
2.3
4.1
Deferred income taxes
(3.7
)
1.9
(0.6
)
Share-based compensation expense and
common stock warrants
134.4
4.8
6.0
Changes in operating assets and
liabilities:
Accounts receivable
30.5
(44.8
)
130.5
Other receivables due from related
parties
(4.1
)
4.4
(3.2
)
Inventories
(1.4
)
2.7
13.1
Income taxes receivable
(24.9
)
(0.5
)
2.0
Other current assets
(30.0
)
(19.5
)
—
Other assets
(1.6
)
(4.4
)
1.3
Accounts payable due to related
parties
15.4
(16.5
)
(24.8
)
Accounts payable
(47.9
)
2.1
(79.2
)
Accrued expenses
30.5
(5.5
)
12.3
Accrued royalties
(24.3
)
(3.6
)
(3.1
)
Income taxes payable
—
—
—
Other current liabilities
(0.3
)
3.5
0.1
Other long-term liabilities
5.9
2.9
(1.7
)
Net cash provided by operating
activities
41.9
32.3
79.9
Cash flows from investing
activities:
Purchases of property and equipment
(4.4
)
(1.8
)
(0.8
)
Purchase of investments
(0.2
)
—
—
Net cash used in investing activities
(4.6
)
(1.8
)
(0.8
)
Cash flows from financing
activities:
Proceeds from exercise of stock
options
12.4
0.2
0.2
Payment of dividends on Series A
convertible preferred stock
(0.6
)
—
—
Proceeds from IPO, net of $10,700 in
direct offering costs
148.0
—
—
Payments of other offering costs
(2.8
)
—
—
Withholding taxes paid on behalf of
employees on net settled share-based awards
(71.0
)
—
—
Proceeds from sale of stock under ESPP
1.7
—
—
Net cash provided by financing
activities
87.7
0.2
0.2
Effect of exchange rate changes on cash
and cash equivalents
(1.1
)
0.4
0.1
Net increase in cash and cash
equivalents
123.9
31.1
79.4
Cash and cash equivalents at beginning
of year
207.7
176.6
97.2
Cash and cash equivalents at end of
year
$
331.6
$
207.7
$
176.6
Supplemental disclosure of cash flow
information:
Cash paid for income taxes
$
36.1
$
27.6
$
6.4
Cash paid for interest
$
0.2
$
0.2
$
0.2
Supplemental disclosure of non-cash
investing and financing activities:
Right-of-use assets obtained in exchange
for new operating lease liabilities
$
3.6
$
5.2
$
0.2
Cash paid for amounts included in the
measurement of operating lease liabilities
$
2.9
$
2.5
$
1.8
IPO costs not yet paid
$
0.3
$
—
$
—
VIZIO HOLDING CORP.
Reconciliation of Net (Loss)
Income to Adjusted EBITDA
(Unaudited, in millions)
Three Months Ended
December 31,
Year Ended
December 31,
2021
2020
2021
2020
Net (loss) income
$
(10.1
)
$
40.8
$
(39.4
)
$
102.5
Adjusted to exclude the following:
Interest (income) expense, net
(0.2
)
0.1
(0.3
)
—
Other income, net
(3.2
)
(0.1
)
(3.0
)
(0.5
)
Provision for (benefit from) income
taxes
(6.5
)
12.2
13.1
29.9
Depreciation and amortization
0.8
0.6
2.8
2.3
Share-based compensation
36.5
0.8
134.4
4.8
Adjusted EBITDA
$
17.3
$
54.4
$
107.6
$
139.0
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220301006319/en/
Investors and Analysts: Michael Marks IR@vizio.com
Media: press@vizio.com
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