|
PERION NETWORK LTD.
By: /s/ Maoz Sigron
Name: Maoz Sigron
Title: Chief Financial Officer
|
• |
We are leveraging our diversification strategy as advertisers are shifting their direct response budgets from social advertising (mainly Facebook) to search advertising
|
• |
We are continuously expanding our profit margins, which demonstrates the strategic and economic value of our Intelligent HUB (iHUB)
|
• |
We are bringing innovation – through SORT™ – in response to advertiser recognition that privacy matters more than ever
|
• |
We are meeting our clients’ objective to enhance their brand equity by increasing user engagement through Perion’s High-Impact ad suite.”
|
• |
Media margin increased to 41%, compared with 39% in Q3 2021
|
• |
Adjusted EBITDA to revenue ex-TAC of 51% vs. 37% last year. This is among the highest in the industry
|
• |
Video revenue increased by 209% year-over-year, representing 44% of Display Advertising revenue
|
• |
CTV revenue increased by 134% year-over-year, representing 9% of Display Advertising revenue compared with 5% last year
|
• |
SORTTM spending increased by 25% over the previous quarter, driven by an 11% increase in the number of customers from 126 to 140
|
• |
The increase in market adoption of our holistic Video Platform solution continues to deliver strong results:
|
o |
88% year-over-year increase in the number of Video Platform publishers
|
o |
67% year-over-year increase in revenue from existing Video Platform publishers
|
• |
The number of search advertising publishers increased by 60% year-over-year, RPM increased by 42% over the same period
|
In millions,
except per share data |
Three months ended
|
|
Nine months ended
|
|
||||||||||||
|
September 30,
|
|
September 30,
|
|
||||||||||||
|
2022
|
|
2021
|
|
%
|
|
2022
|
|
2021
|
|
%
|
|
||||
Display Advertising Revenue
|
$
|
86.8
|
|
$
|
69.0
|
|
+26%
|
|
$
|
236.9
|
|
$
|
165.1
|
|
+43%
|
|
Search Advertising Revenue
|
$
|
71.8
|
|
$
|
52.0
|
|
+38%
|
|
$
|
193.7
|
|
$
|
155.4
|
|
+25%
|
|
Total Revenue
|
$
|
158.6
|
|
$
|
121.0
|
|
+31%
|
|
$
|
430.6
|
|
$
|
320.5
|
|
+34%
|
|
GAAP Net Income
|
$
|
25.6
|
|
$
|
10.6
|
|
+141%
|
|
$
|
60.5
|
|
$
|
21.0
|
|
+188%
|
|
Non-GAAP Net Income
|
$
|
29.9
|
|
$
|
15.4
|
|
+94%
|
|
$
|
75.1
|
|
$
|
34.7
|
|
+117%
|
|
Adjusted EBITDA
|
$
|
33.0
|
|
$
|
17.6
|
|
+87%
|
|
$
|
84.1
|
|
$
|
40.7
|
|
+107%
|
|
Adjusted EBITDA to Revenue ex-TAC
|
|
51%
|
|
|
37%
|
|
|
|
47%
|
|
|
32%
|
|
|
||
Net Cash from Operations
|
$
|
34.7
|
|
$
|
14.2
|
|
+145%
|
|
$
|
83.9
|
|
$
|
42.3
|
|
+99%
|
|
GAAP Diluted EPS
|
$
|
0.53
|
|
$
|
0.28
|
|
+89%
|
|
$
|
1.27
|
|
$
|
0.57
|
|
+123%
|
|
Non-GAAP Diluted EPS
|
$
|
0.61
|
|
$
|
0.40
|
|
+53%
|
|
$
|
1.56
|
|
$
|
0.93
|
|
+68%
|
|
In millions
|
|||||||||
2021
|
Prior 2022
Guidance
|
Current 2022
Guidance
|
YoY
Growth %1
|
|
|||||
Revenue
|
$478.5
|
$620-$640
|
$630-$635
|
32%1
|
|
||||
Adjusted EBITDA
|
$69.6
|
$102+
|
$120+
|
72%1
|
|
||||
Adjusted EBITDA to Revenue ex-TAC
|
37%
|
41%
|
46%1
|
|
● |
Registration link:
|
● |
Toll Free: 1-877-407-0779
|
● |
Toll/International: 1-201-389-0914
|
Three months ended
|
Nine months ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
|||||||||||||
Revenue:
|
||||||||||||||||
Display Advertising
|
$
|
86,779
|
$
|
68,980
|
$
|
236,933
|
$
|
165,146
|
||||||||
Search Advertising
|
71,836
|
52,049
|
193,653
|
155,377
|
||||||||||||
Total Revenue
|
158,615
|
121,029
|
430,586
|
320,523
|
||||||||||||
Costs and Expenses:
|
||||||||||||||||
Cost of revenue
|
7,540
|
6,284
|
21,014
|
17,879
|
||||||||||||
Traffic acquisition costs and media buy
|
93,625
|
73,590
|
250,555
|
194,676
|
||||||||||||
Research and development
|
7,766
|
8,630
|
25,135
|
26,103
|
||||||||||||
Selling and marketing
|
12,591
|
12,926
|
39,884
|
36,410
|
||||||||||||
General and administrative
|
3,793
|
5,295
|
15,927
|
14,055
|
||||||||||||
Depreciation and amortization
|
3,704
|
1,922
|
10,097
|
6,299
|
||||||||||||
Total Costs and Expenses
|
129,019
|
108,647
|
362,612
|
295,422
|
||||||||||||
Income from Operations
|
29,596
|
12,382
|
67,974
|
25,101
|
||||||||||||
Financial expense (income), net
|
(1,019
|
)
|
11
|
(2,526
|
)
|
116
|
||||||||||
Income before Taxes on income
|
30,615
|
12,371
|
70,500
|
24,985
|
||||||||||||
Taxes on income
|
5,033
|
1,749
|
9,952
|
3,974
|
||||||||||||
Net Income
|
$
|
25,582
|
$
|
10,622
|
$
|
60,548
|
$
|
21,011
|
||||||||
Net Earnings per Share
|
||||||||||||||||
Basic
|
$
|
0.57
|
$
|
0.31
|
$
|
1.36
|
$
|
0.63
|
||||||||
Diluted
|
$
|
0.53
|
$
|
0.28
|
$
|
1.27
|
$
|
0.57
|
||||||||
Weighted average number of shares
|
||||||||||||||||
Basic
|
45,146,639
|
34,567,551
|
44,544,483
|
33,605,215
|
||||||||||||
Diluted
|
47,997,745
|
37,865,732
|
47,560,112
|
36,866,637
|
|
September 30,
|
December 31,
|
||||||
|
2022
|
2021
|
||||||
|
(Unaudited)
|
(Audited)
|
||||||
ASSETS
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
171,355
|
$
|
104,446
|
||||
Restricted cash
|
1,042
|
1,089
|
||||||
Short-term bank deposits
|
219,000
|
217,200
|
||||||
Accounts receivable, net
|
99,862
|
115,361
|
||||||
Prepaid expenses and other current assets
|
10,587
|
8,075
|
||||||
Total Current Assets
|
501,846
|
446,171
|
||||||
|
||||||||
Long-Term Assets:
|
||||||||
Property and equipment, net
|
3,766
|
4,211
|
||||||
Operating lease right-of-use assets
|
9,175
|
11,578
|
||||||
Goodwill and intangible assets, net
|
250,179
|
245,965
|
||||||
Deferred taxes
|
2,955
|
5,228
|
||||||
Other assets
|
68
|
79
|
||||||
Total Long-Term Assets
|
266,143
|
267,061
|
||||||
Total Assets
|
$
|
767,989
|
$
|
713,232
|
||||
|
||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Accounts payable
|
$
|
110,672
|
$
|
107,730
|
||||
Accrued expenses and other liabilities
|
29,376
|
40,331
|
||||||
Short-term operating lease liability
|
3,200
|
3,615
|
||||||
Deferred revenue
|
2,098
|
3,852
|
||||||
Short-term payment obligation related to acquisitions
|
34,571
|
38,179
|
||||||
Total Current Liabilities
|
179,917
|
193,707
|
||||||
|
||||||||
Long-Term Liabilities:
|
||||||||
Payment obligation related to acquisition
|
32,966
|
33,250
|
||||||
Long-term operating lease liability
|
6,805
|
9,774
|
||||||
Other long-term liabilities
|
9,265
|
9,541
|
||||||
Total Long-Term Liabilities
|
49,036
|
52,565
|
||||||
Total Liabilities
|
228,953
|
246,272
|
||||||
|
||||||||
Shareholders' equity:
|
||||||||
Ordinary shares
|
389
|
375
|
||||||
Additional paid-in capital
|
508,946
|
496,154
|
||||||
Treasury shares at cost
|
(1,002
|
)
|
(1,002
|
)
|
||||
Accumulated other comprehensive loss
|
(1,406
|
)
|
(128
|
)
|
||||
Retained earnings (accumulated deficit)
|
32,109
|
(28,439
|
)
|
|||||
Total Shareholders' Equity
|
539,036
|
466,960
|
||||||
Total Liabilities and Shareholders' Equity
|
$
|
767,989
|
$
|
713,232
|
|
Three months ended
|
Nine months ended
|
||||||||||||||
|
September 30,
|
September 30,
|
||||||||||||||
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
||||||||||||||||
Cash flows from operating activities:
|
||||||||||||||||
Net Income
|
$
|
25,582
|
$
|
10,622
|
$
|
60,548
|
$
|
21,011
|
||||||||
Adjustments required to reconcile net income to net cash provided by operating activities:
|
||||||||||||||||
Depreciation and amortization
|
3,704
|
1,922
|
10,097
|
6,299
|
||||||||||||
Stock-based compensation expense
|
3,236
|
1,744
|
8,365
|
3,733
|
||||||||||||
Foreign currency translation
|
(64
|
)
|
(18
|
)
|
(238
|
)
|
(107
|
)
|
||||||||
Accrued interest, net
|
(825
|
)
|
(53
|
)
|
(2,006
|
)
|
(220
|
)
|
||||||||
Deferred taxes, net
|
1,575
|
(478
|
)
|
1,327
|
(183
|
)
|
||||||||||
Accrued severance pay, net
|
(831
|
)
|
135
|
(328
|
)
|
333
|
||||||||||
Gain from sale of property and equipment
|
(5
|
)
|
-
|
(10
|
)
|
(11
|
)
|
|||||||||
Net changes in operating assets and liabilities
|
2,300
|
301
|
6,194
|
11,415
|
||||||||||||
Net cash provided by operating activities
|
$
|
34,672
|
$
|
14,175
|
$
|
83,949
|
$
|
42,270
|
||||||||
|
||||||||||||||||
Cash flows from investing activities:
|
||||||||||||||||
Purchases of property and equipment, net of sales
|
(349
|
)
|
(141
|
)
|
(779
|
)
|
(495
|
)
|
||||||||
Short-term deposits, net
|
31,600
|
23,000
|
(1,800
|
)
|
(47,300
|
)
|
||||||||||
Cash paid in connection with acquisitions, net of cash acquired
|
-
|
-
|
(9,570
|
)
|
(3,438
|
)
|
||||||||||
Net cash provided by (used in) investing activities
|
$
|
31,251
|
$
|
22,859
|
$
|
(12,149
|
)
|
$
|
(51,233
|
)
|
||||||
|
||||||||||||||||
Cash flows from financing activities:
|
||||||||||||||||
Issuance of shares in private placement, net
|
-
|
-
|
-
|
60,960
|
||||||||||||
Proceeds from exercise of stock-based compensation
|
3,147
|
1,069
|
4,441
|
4,940
|
||||||||||||
Payments of contingent consideration
|
-
|
-
|
(9,091
|
)
|
-
|
|||||||||||
Repayment of long-term loans
|
-
|
-
|
-
|
(8,333
|
)
|
|||||||||||
Net cash provided by (used in) financing activities
|
$
|
3,147
|
$
|
1,069
|
$
|
(4,650
|
)
|
$
|
57,567
|
|||||||
|
||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash
|
(110
|
)
|
(46
|
)
|
(288
|
)
|
(49
|
)
|
||||||||
Net increase in cash and cash equivalents and restricted cash
|
68,960
|
38,057
|
66,862
|
48,555
|
||||||||||||
Cash and cash equivalents and restricted cash at beginning of period
|
103,437
|
59,376
|
105,535
|
48,878
|
||||||||||||
Cash and cash equivalents and restricted cash at end of period
|
$
|
172,397
|
$
|
97,433
|
$
|
172,397
|
$
|
97,433
|
Three months ended
|
Nine months ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
GAAP Net Income
|
$
|
25,582
|
$
|
10,622
|
$
|
60,548
|
$
|
21,011
|
||||||||
Stock-based compensation
|
3,236
|
1,744
|
8,365
|
3,733
|
||||||||||||
Amortization of acquired intangible assets
|
3,295
|
1,370
|
8,896
|
4,068
|
||||||||||||
Retention and other related to M&A related expenses
|
288
|
1,561
|
1,518
|
5,527
|
||||||||||||
Changes in FV of Earnout contingent consideration
|
(3,816
|
)
|
-
|
(3,816
|
)
|
-
|
||||||||||
Foreign exchange losses (gains) associated with ASC-842
|
(80
|
)
|
6
|
(824
|
)
|
(207
|
)
|
|||||||||
Revaluation of acquisition related contingent consideration
|
342
|
136
|
602
|
476
|
||||||||||||
Taxes on the above items
|
1,067
|
(54
|
)
|
(145
|
)
|
92
|
||||||||||
Non-GAAP Net Income
|
$
|
29,914
|
$
|
15,385
|
$
|
75,144
|
$
|
34,700
|
||||||||
Non-GAAP Net Income
|
$
|
29,914
|
$
|
15,385
|
$
|
75,144
|
$
|
34,700
|
||||||||
Taxes on income
|
3,966
|
1,803
|
10,097
|
3,882
|
||||||||||||
Financial income, net
|
(1,281
|
)
|
(131
|
)
|
(2,304
|
)
|
(153
|
)
|
||||||||
Depreciation
|
409
|
552
|
1,201
|
2,231
|
||||||||||||
Adjusted EBITDA
|
$
|
33,008
|
$
|
17,609
|
$
|
84,138
|
$
|
40,660
|
||||||||
Non-GAAP diluted earnings per share
|
$
|
0.61
|
$
|
0.40
|
$
|
1.56
|
$
|
0.93
|
||||||||
Shares used in computing non-GAAP diluted earnings per share
|
48,873,796
|
38,428,524
|
48,112,823
|
37,206,600
|