|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
54-1955550
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification Number)
|
Large accelerated filer
|
|
þ
|
|
Accelerated filer
|
|
¨
|
Non-accelerated filer
|
|
o
|
|
Smaller reporting company
|
|
¨
|
|
|
|
|
Emerging growth company
|
|
¨
|
Title of Each Class
|
|
Trading Symbol
|
|
Name of Each Exchange on Which Registered
|
Common Stock, par value $0.001 per share
|
|
SCOR
|
|
NASDAQ Global Select Market
|
|
|
|
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
As of
|
|
As of
|
||||
|
March 31, 2019
|
|
December 31, 2018
|
||||
|
(Unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
36,741
|
|
|
$
|
44,096
|
|
Restricted cash
|
6,102
|
|
|
6,102
|
|
||
Accounts receivable, net of allowances of $1,683 and $1,597, respectively ($3,818 and $4,024 of accounts receivable attributable to related parties, respectively)
|
63,057
|
|
|
75,609
|
|
||
Prepaid expenses and other current assets ($849 and $484 attributable to related parties)
|
18,678
|
|
|
19,972
|
|
||
Total current assets
|
124,578
|
|
|
145,779
|
|
||
Property and equipment, net
|
28,406
|
|
|
27,339
|
|
||
Operating right-of-use assets
|
41,210
|
|
|
—
|
|
||
Other non-current assets ($50 and $65 attributable to related parties)
|
5,908
|
|
|
8,898
|
|
||
Deferred tax assets
|
2,842
|
|
|
3,991
|
|
||
Intangible assets, net
|
118,840
|
|
|
126,945
|
|
||
Goodwill
|
640,786
|
|
|
641,191
|
|
||
Total assets
|
$
|
962,570
|
|
|
$
|
954,143
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable ($2,187 and $1,878 attributable to related parties, respectively)
|
$
|
38,225
|
|
|
$
|
29,836
|
|
Accrued expenses ($1,426 and $4,478 attributable to related parties, respectively)
|
42,126
|
|
|
58,140
|
|
||
Contract liability ($3,007 and $2,521 attributable to related parties, respectively)
|
62,640
|
|
|
64,189
|
|
||
Current operating lease liabilities
|
6,629
|
|
|
—
|
|
||
Customer advances
|
6,155
|
|
|
6,688
|
|
||
Other current liabilities
|
5,692
|
|
|
10,083
|
|
||
Total current liabilities
|
161,467
|
|
|
168,936
|
|
||
Financing derivatives (related parties)
|
22,000
|
|
|
26,100
|
|
||
Senior secured convertible notes (related parties)
|
178,913
|
|
|
177,342
|
|
||
Non-current operating lease liabilities
|
47,739
|
|
|
—
|
|
||
Deferred rent
|
—
|
|
|
10,304
|
|
||
Deferred tax liabilities
|
4,825
|
|
|
5,527
|
|
||
Other non-current liabilities ($5,353 and $251 attributable to related parties)
|
13,688
|
|
|
14,367
|
|
||
Total liabilities
|
428,632
|
|
|
402,576
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value per share; 5,000,000 shares authorized at March 31, 2019 and December 31, 2018; no shares issued or outstanding as of March 31, 2019 and December 31, 2018
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value per share; 150,000,000 shares authorized as of March 31, 2019 and December 31, 2018; 66,722,683 shares issued and 59,957,887 shares outstanding as of March 31, 2019, and 66,154,626 shares issued and 59,389,830 shares outstanding as of December 31, 2018
|
60
|
|
|
59
|
|
||
Additional paid-in capital
|
1,571,759
|
|
|
1,561,208
|
|
||
Accumulated other comprehensive loss
|
(11,242
|
)
|
|
(10,621
|
)
|
||
Accumulated deficit
|
(796,655
|
)
|
|
(769,095
|
)
|
||
Treasury stock, at cost, 6,764,796 shares as of March 31, 2019 and December 31, 2018
|
(229,984
|
)
|
|
(229,984
|
)
|
||
Total stockholders’ equity
|
533,938
|
|
|
551,567
|
|
||
Total liabilities and stockholders’ equity
|
$
|
962,570
|
|
|
$
|
954,143
|
|
|
Common Stock
|
|
Additional
Paid-In Capital |
|
Accumulated
Other Comprehensive Loss |
|
Accumulated
Deficit |
|
Treasury stock, at cost
|
|
Total
Stockholders’ Equity |
|||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||
Balance as of December 31, 2018
|
59,389,830
|
|
|
$
|
59
|
|
|
$
|
1,561,208
|
|
|
$
|
(10,621
|
)
|
|
$
|
(769,095
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
551,567
|
|
Adoption of ASC 842
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
(46
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,514
|
)
|
|
—
|
|
|
(27,514
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(621
|
)
|
|
—
|
|
|
—
|
|
|
(621
|
)
|
||||||
Exercise of Common Stock options, net
|
68,259
|
|
|
—
|
|
|
1,191
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,191
|
|
||||||
Restricted stock units vested
|
552,651
|
|
|
1
|
|
|
4,610
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,611
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(52,853
|
)
|
|
—
|
|
|
(1,138
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,138
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
5,888
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,888
|
|
||||||
Balance as of March 31, 2019
|
59,957,887
|
|
|
$
|
60
|
|
|
$
|
1,571,759
|
|
|
$
|
(11,242
|
)
|
|
$
|
(796,655
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
533,938
|
|
|
Common Stock
|
|
Additional
Paid-In Capital |
|
Accumulated
Other Comprehensive Loss |
|
Accumulated
Deficit |
|
Treasury stock, at cost
|
|
Total
Stockholders’ Equity |
|||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||
Balance as of December 31, 2017
|
57,289,047
|
|
|
$
|
60
|
|
|
$
|
1,407,717
|
|
|
$
|
(6,224
|
)
|
|
$
|
(609,091
|
)
|
|
$
|
(135,970
|
)
|
|
$
|
656,492
|
|
Adoption of ASC 606
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(736
|
)
|
|
—
|
|
|
(736
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,450
|
)
|
|
—
|
|
|
(51,450
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
1,615
|
|
|
—
|
|
|
—
|
|
|
1,615
|
|
||||||
Subscription receivable
|
—
|
|
|
—
|
|
|
3,065
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,065
|
|
||||||
Common Stock warrants issuable
|
—
|
|
|
—
|
|
|
5,545
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,545
|
|
||||||
Repurchase of Common Stock in exchange for senior secured convertible notes
|
(2,600,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(63,570
|
)
|
|
(63,570
|
)
|
||||||
Restricted stock units vested
|
487,027
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(158,404
|
)
|
|
—
|
|
|
(4,099
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,099
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
1,881
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,881
|
|
||||||
Balance as of March 31, 2018
|
55,017,670
|
|
|
$
|
60
|
|
|
$
|
1,414,109
|
|
|
$
|
(4,609
|
)
|
|
$
|
(661,277
|
)
|
|
$
|
(199,540
|
)
|
|
$
|
548,743
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating activities:
|
|
|
|
||||
Net loss
|
$
|
(27,514
|
)
|
|
$
|
(51,450
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation
|
3,106
|
|
|
4,563
|
|
||
Non-cash operating lease expense
|
1,427
|
|
|
—
|
|
||
Amortization expense of finance leases
|
574
|
|
|
—
|
|
||
Amortization of intangible assets
|
8,105
|
|
|
8,544
|
|
||
Stock-based compensation
|
6,953
|
|
|
1,881
|
|
||
Deferred tax provision
|
441
|
|
|
906
|
|
||
Change in fair value of financing derivatives
|
(4,100
|
)
|
|
2,180
|
|
||
Change in fair value of investment in equity securities
|
1,712
|
|
|
449
|
|
||
Accretion of debt discount
|
1,319
|
|
|
752
|
|
||
Amortization of deferred financing costs
|
252
|
|
|
207
|
|
||
Other
|
(138
|
)
|
|
(69
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
12,506
|
|
|
11,095
|
|
||
Prepaid expenses and other assets
|
1,818
|
|
|
(597
|
)
|
||
Accounts payable, accrued expenses, and other liabilities
|
(2,544
|
)
|
|
(19,761
|
)
|
||
Contract liability and customer advances
|
(2,500
|
)
|
|
(3,498
|
)
|
||
Operating lease liabilities
|
(2,993
|
)
|
|
—
|
|
||
Net cash used in operating activities
|
(1,576
|
)
|
|
(44,798
|
)
|
||
|
|
|
|
||||
Investing activities:
|
|
|
|
||||
Proceeds from sale of investment in equity securities
|
705
|
|
|
—
|
|
||
Purchases of property and equipment
|
(1,836
|
)
|
|
(725
|
)
|
||
Capitalized internal-use software costs
|
(3,109
|
)
|
|
(1,932
|
)
|
||
Net cash used in investing activities
|
(4,240
|
)
|
|
(2,657
|
)
|
||
|
|
|
|
||||
Financing activities:
|
|
|
|
||||
Proceeds from borrowings on senior secured convertible notes (related party)
|
—
|
|
|
85,000
|
|
||
Debt issuance costs
|
—
|
|
|
(4,315
|
)
|
||
Financing proceeds received on subscription receivable (related party)
|
—
|
|
|
3,065
|
|
||
Proceeds from the exercise of stock options
|
1,191
|
|
|
—
|
|
||
Payments for taxes related to net share settlement of equity awards
|
(1,138
|
)
|
|
(4,099
|
)
|
||
Principal payments on finance leases
|
(694
|
)
|
|
—
|
|
||
Principal payments on capital lease and software license arrangements
|
(823
|
)
|
|
(2,859
|
)
|
||
Net cash (used in) provided by financing activities
|
(1,464
|
)
|
|
76,792
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(75
|
)
|
|
368
|
|
||
Net (decrease) increase in cash, cash equivalents and restricted cash
|
(7,355
|
)
|
|
29,705
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
50,198
|
|
|
45,125
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
42,843
|
|
|
$
|
74,830
|
|
|
|
|
|
||||
|
|
|
|
||||
|
As of March 31,
|
||||||
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
36,741
|
|
|
$
|
67,266
|
|
Restricted cash
|
6,102
|
|
|
7,564
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
42,843
|
|
|
$
|
74,830
|
|
|
|
|
|
1.
|
Organization
|
2.
|
Summary of Significant Accounting Policies
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Change in fair value of financing derivatives
|
$
|
4,100
|
|
|
$
|
(2,180
|
)
|
Change in fair value of investment in equity securities
|
(1,712
|
)
|
|
(449
|
)
|
||
Transition services agreement income
|
534
|
|
|
2,665
|
|
||
Other
|
47
|
|
|
41
|
|
||
Total other income, net
|
$
|
2,969
|
|
|
$
|
77
|
|
|
Three Months Ended March 31,
|
||||
|
2019
|
|
2018
|
||
Stock options, stock appreciation rights, restricted stock units and senior secured convertible notes
|
8,100,585
|
|
|
8,164,341
|
|
•
|
Not to reassess whether any expired or existing contracts are or contain leases.
|
•
|
Not to reassess the lease classification for any expired or existing leases.
|
•
|
Not to reassess initial direct costs for any existing leases.
|
•
|
The hindsight practical expedient in determining the lease term.
|
•
|
The practical expedient whereby the lease and non-lease components will not be separated for all classes of assets.
|
•
|
Not to record ROU assets and corresponding lease liabilities with a lease term of 12 months or less.
|
(In thousands)
|
As previously reported as of December 31, 2018
|
|
New lease standard adjustments
|
|
As adjusted as of January 1, 2019
|
||||||
Operating right-of-use assets
|
$
|
—
|
|
|
$
|
42,472
|
|
|
$
|
42,472
|
|
Property and equipment, net
|
27,339
|
|
|
(203
|
)
|
|
27,136
|
|
|||
Current capital lease obligations
|
2,421
|
|
|
(161
|
)
|
|
2,260
|
|
|||
Current restructuring accrual
|
5,479
|
|
|
(708
|
)
|
|
4,771
|
|
|||
Current deferred rent
|
1,884
|
|
|
(1,884
|
)
|
|
—
|
|
|||
Current operating lease liabilities
|
—
|
|
|
7,846
|
|
|
7,846
|
|
|||
Non-current restructuring accrual
|
1,810
|
|
|
(1,810
|
)
|
|
—
|
|
|||
Non-current deferred rent
|
10,304
|
|
|
(10,304
|
)
|
|
—
|
|
|||
Non-current capital lease obligations
|
1,182
|
|
|
3
|
|
|
1,185
|
|
|||
Non-current operating lease liabilities
|
—
|
|
|
49,333
|
|
|
49,333
|
|
|||
Stockholders' equity
|
551,567
|
|
|
(46
|
)
|
|
551,521
|
|
3.
|
Revenue Recognition
|
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
(1)
|
||||
By Solution group:
|
|
|
|
|
||||
Ratings and Planning
|
|
$
|
70,577
|
|
|
$
|
69,569
|
|
Analytics and Optimization
|
|
21,458
|
|
|
25,731
|
|
||
Movies Reporting and Analytics
|
|
10,259
|
|
|
10,619
|
|
||
Total
|
|
$
|
102,294
|
|
|
$
|
105,919
|
|
By Geographical markets:
|
|
|
|
|
||||
United States
|
|
$
|
87,976
|
|
|
$
|
91,477
|
|
Europe
|
|
8,412
|
|
|
9,135
|
|
||
Latin America
|
|
2,402
|
|
|
2,611
|
|
||
Canada
|
|
1,840
|
|
|
1,920
|
|
||
Other
|
|
1,664
|
|
|
776
|
|
||
Total
|
|
$
|
102,294
|
|
|
$
|
105,919
|
|
Timing of revenue recognition:
|
|
|
|
|
||||
Products and services transferred at a point in time
|
|
$
|
25,833
|
|
|
$
|
29,295
|
|
Products and services transferred over time
|
|
76,461
|
|
|
76,624
|
|
||
Total
|
|
$
|
102,294
|
|
|
$
|
105,919
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Accounts receivable, net
|
|
$
|
63,057
|
|
|
$
|
75,609
|
|
Current and non-current contract assets
|
|
2,344
|
|
|
2,438
|
|
||
Current and non-current contract costs
|
|
942
|
|
|
1,402
|
|
||
Current contract liability
|
|
62,640
|
|
|
64,189
|
|
||
Current customer advances
|
|
6,155
|
|
|
6,688
|
|
||
Non-current contract liability
|
|
374
|
|
|
508
|
|
|
|
Contract Liability (Current)
|
||||||
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Revenue recognized that was included in the contract liability balance at the beginning of period
|
|
$
|
(39,481
|
)
|
|
$
|
(52,572
|
)
|
Cash received or amounts billed in advance and not recognized as revenue
|
|
39,200
|
|
|
50,705
|
|
4.
|
Long-term Debt
|
|
|
|
As of
|
|||||||||||
|
|
|
March 31, 2019
|
|||||||||||
(In thousands, except interest rates)
|
Stated Interest Rate
|
Effective Interest Rate
|
Face Value
|
Issuance Discount
|
Deferred Financing Costs
|
Net Carrying Value
|
||||||||
Initial Notes, due January 16, 2022
|
12.0%
|
18.6%
|
$
|
153,500
|
|
$
|
(18,297
|
)
|
$
|
(3,471
|
)
|
$
|
131,732
|
|
Option Notes, due January 16, 2022
|
12.0%
|
14.9%
|
50,500
|
|
(3,106
|
)
|
(213
|
)
|
47,181
|
|
||||
Total
|
|
|
$
|
204,000
|
|
$
|
(21,403
|
)
|
$
|
(3,684
|
)
|
$
|
178,913
|
|
|
|
|
As of
|
|||||||||||
|
|
|
December 31, 2018
|
|||||||||||
(In thousands, except interest rates)
|
Stated Interest Rate
|
Effective Interest Rate
|
Face Value
|
Issuance Discount
|
Deferred Financing Costs
|
Net Carrying Value
|
||||||||
Initial Notes, due January 16, 2022
|
6.0%
|
12.0%
|
$
|
153,500
|
|
$
|
(19,627
|
)
|
$
|
(3,724
|
)
|
$
|
130,149
|
|
Option Notes, due January 16, 2022
|
6.0%
|
8.5%
|
50,500
|
|
(3,096
|
)
|
(211
|
)
|
47,193
|
|
||||
Total
|
|
|
$
|
204,000
|
|
$
|
(22,723
|
)
|
$
|
(3,935
|
)
|
$
|
177,342
|
|
5.
|
Fair Value Measurements
|
|
|
As of
|
|
As of
|
||||||||||||||||||||||||||||
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds
(1)
|
|
$
|
8,804
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,804
|
|
|
$
|
6,037
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,037
|
|
Investment in equity securities
(2)
|
|
3,683
|
|
|
—
|
|
|
—
|
|
|
3,683
|
|
|
6,100
|
|
|
—
|
|
|
—
|
|
|
6,100
|
|
||||||||
Total
|
|
$
|
12,487
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,487
|
|
|
$
|
12,137
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,137
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financing derivatives: no hedging designation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate reset
(3)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,500
|
|
|
$
|
18,500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23,300
|
|
|
$
|
23,300
|
|
Change of control redemption
(4)
|
|
—
|
|
|
—
|
|
|
3,500
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
2,800
|
|
|
2,800
|
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,000
|
|
|
$
|
22,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,100
|
|
|
$
|
26,100
|
|
(In thousands)
|
|
Financing Derivative Liabilities
|
||
Balance as of December 31, 2018
|
|
$
|
26,100
|
|
Total (gains) losses included in other income, net
(1)
|
|
(4,100
|
)
|
|
Balance as of March 31, 2019
|
|
$
|
22,000
|
|
(In thousands)
|
|
Financing Derivative Liabilities
|
||
Balance as of December 31, 2017
|
|
$
|
—
|
|
Issuances
|
|
12,940
|
|
|
Total (gains) losses included in other income, net
(1)
|
|
2,180
|
|
|
Balance as of March 31, 2018
|
|
$
|
15,120
|
|
|
Fair value measurements
|
||||||||
|
Significant valuation technique
|
|
Significant unobservable inputs
|
|
March 31, 2019
|
|
December 31, 2018
|
||
Interest rate reset derivative liability
|
Discounted cash flow
|
|
Discount rate
|
|
24.0%
|
|
25.0%
|
||
|
|
|
Stock price
|
|
$20.25
|
|
$14.43
|
||
|
|
|
Risk-free rate
|
|
2.2%
|
|
2.5%
|
||
|
|
|
Volatility
|
|
37.1%
|
|
43.9%
|
||
|
|
|
Term
|
|
2.79 years
|
|
3.04 years
|
||
|
|
|
|
|
|
|
|
||
Change of control redemption derivative liability
|
Option pricing model
|
|
Probability
|
|
0-10%
|
|
0-10%
|
||
|
|
|
Risk-free rate
|
|
2.2%
|
|
2.5%
|
6.
|
Accrued Expenses
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Payroll and payroll-related
|
|
$
|
11,353
|
|
|
$
|
18,972
|
|
Accrued data costs
|
|
13,994
|
|
|
14,617
|
|
||
Professional fees
|
|
6,405
|
|
|
8,477
|
|
||
Restructuring accrual
|
|
2,571
|
|
|
5,479
|
|
||
Accrued interest on senior secured convertible notes
|
|
—
|
|
|
3,046
|
|
||
Other
|
|
7,803
|
|
|
7,549
|
|
||
|
|
$
|
42,126
|
|
|
$
|
58,140
|
|
7.
|
Related Party Transactions
|
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Revenues
(1)
|
|
$
|
3,845
|
|
|
$
|
2,091
|
|
|
|
|
|
|
||||
Cost of revenues
|
|
2,095
|
|
|
2,490
|
|
||
Selling and marketing
|
|
3
|
|
|
43
|
|
||
Research and development
|
|
—
|
|
|
30
|
|
||
General and administrative
|
|
40
|
|
|
27
|
|
||
|
|
|
|
|
||||
Interest income
|
|
—
|
|
|
219
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
|
||||
Accounts receivable, net
|
|
$
|
3,669
|
|
|
$
|
3,353
|
|
Prepaid expenses and other current assets
|
|
835
|
|
|
429
|
|
||
Other non-current assets
|
|
50
|
|
|
65
|
|
||
Liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,187
|
|
|
$
|
1,833
|
|
Accrued expenses
|
|
1,325
|
|
|
1,384
|
|
||
Contract liability
|
|
2,894
|
|
|
1,945
|
|
||
Other non-current liabilities
|
|
219
|
|
|
251
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Accrued expenses
|
|
$
|
—
|
|
|
$
|
3,046
|
|
Financing derivatives
|
|
22,000
|
|
|
26,100
|
|
||
Senior secured convertible notes
|
|
178,913
|
|
|
177,342
|
|
||
Other non-current liabilities
|
|
5,134
|
|
|
—
|
|
8.
|
Leases
|
|
|
Three Months Ended
|
|||
(In thousands)
|
|
March 31, 2019
|
|||
Supplemental Cash Flows Information
|
|
|
|||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|||
Operating cash flows from finance leases
|
|
$
|
73
|
|
|
Operating cash flows from operating leases
|
|
5,159
|
|
||
Financing cash flows from finance leases
|
|
694
|
|
||
Right-of-use assets obtained in exchange for lease obligations:
|
|
|
|||
Right-of-use assets obtained in exchange for new operating lease liabilities
|
|
$
|
336
|
|
|
|
|
|
||||
(In thousands)
|
Operating Leases
|
|
Finance Leases
|
||||
Remainder of 2019
|
$
|
9,972
|
|
|
$
|
1,458
|
|
2020
|
12,806
|
|
|
479
|
|
||
2021
|
12,288
|
|
|
287
|
|
||
2022
|
9,127
|
|
|
75
|
|
||
2023
|
9,726
|
|
|
43
|
|
||
Thereafter
|
31,478
|
|
|
—
|
|
||
Total lease payments
|
85,397
|
|
|
2,342
|
|
||
Less: imputed interest
|
(31,029
|
)
|
|
(181
|
)
|
||
Total lease liabilities
|
54,368
|
|
|
2,161
|
|
||
Less: current lease liabilities
|
(6,629
|
)
|
|
(1,458
|
)
|
||
Total non-current lease liabilities
|
$
|
47,739
|
|
|
$
|
703
|
|
|
|
||
(In thousands)
|
Sublease Receipts
|
||
Remainder of 2019
|
$
|
1,186
|
|
2020
|
1,693
|
|
|
2021
|
1,597
|
|
|
2022
|
1,551
|
|
|
2023
|
1,145
|
|
|
Thereafter
|
2,905
|
|
|
Total sublease receipts
|
$
|
10,077
|
|
|
As of
|
||
(In thousands)
|
December 31, 2018
|
||
2019
|
$
|
2,582
|
|
2020
|
744
|
|
|
2021
|
417
|
|
|
2022
|
76
|
|
|
2023
|
44
|
|
|
Total minimum lease payments
|
3,863
|
|
|
Less amount representing interest
|
260
|
|
|
Present value of net minimum lease payments
|
3,603
|
|
|
Less current portion
|
2,421
|
|
|
Capital lease obligations, long-term
|
$
|
1,182
|
|
(In thousands)
|
Operating Lease Commitment
|
|
Sublease
Receipts
|
||||
2019
|
$
|
14,780
|
|
|
$
|
1,385
|
|
2020
|
13,027
|
|
|
1,693
|
|
||
2021
|
12,259
|
|
|
1,597
|
|
||
2022
|
9,322
|
|
|
1,551
|
|
||
2023
|
9,722
|
|
|
1,145
|
|
||
Thereafter
|
31,475
|
|
|
2,905
|
|
||
Total minimum lease payments
|
$
|
90,585
|
|
|
$
|
10,276
|
|
9.
|
Contingencies
|
10.
|
Organizational Restructuring
|
(In thousands)
|
|
Severance pay and benefits
|
|
Short-term lease exit and other direct costs
|
|
Long-term lease exit and other direct costs
|
|
Total
|
||||||||
Accrued Balance as of December 31, 2018
|
|
$
|
4,493
|
|
|
$
|
708
|
|
|
$
|
1,810
|
|
|
$
|
7,011
|
|
Adoption of ASC 842
(1)
|
|
—
|
|
|
(708
|
)
|
|
(1,810
|
)
|
|
(2,518
|
)
|
||||
Restructuring income
(2)
|
|
(70
|
)
|
|
—
|
|
|
—
|
|
|
(70
|
)
|
||||
Payments
|
|
(1,852
|
)
|
|
—
|
|
|
—
|
|
|
(1,852
|
)
|
||||
Accrued Balance as of March 31, 2019
|
|
$
|
2,571
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,571
|
|
11.
|
Subsequent Events
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
|
2019
|
|
2018
|
||||||||||
(In thousands)
|
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
||||||
Revenues
|
|
$
|
102,294
|
|
|
100.0
|
%
|
|
$
|
105,919
|
|
|
100.0
|
%
|
Cost of revenues
|
|
53,407
|
|
|
52.2
|
%
|
|
47,254
|
|
|
44.6
|
%
|
||
Selling and marketing
|
|
24,840
|
|
|
24.3
|
%
|
|
25,905
|
|
|
24.5
|
%
|
||
Research and development
|
|
18,216
|
|
|
17.8
|
%
|
|
18,716
|
|
|
17.7
|
%
|
||
General and administrative
|
|
19,545
|
|
|
19.1
|
%
|
|
18,661
|
|
|
17.6
|
%
|
||
Investigation and audit related
|
|
842
|
|
|
0.8
|
%
|
|
31,867
|
|
|
30.1
|
%
|
||
Amortization of intangible assets
|
|
8,105
|
|
|
7.9
|
%
|
|
8,544
|
|
|
8.1
|
%
|
||
Restructuring (income) expense
|
|
(70
|
)
|
|
(0.1
|
)%
|
|
1,257
|
|
|
1.2
|
%
|
||
Total expenses from operations
|
|
124,885
|
|
|
122.1
|
%
|
|
152,204
|
|
|
143.7
|
%
|
||
Loss from operations
|
|
(22,591
|
)
|
|
(22.1
|
)%
|
|
(46,285
|
)
|
|
(43.7
|
)%
|
||
Interest expense, net
|
|
(6,759
|
)
|
|
(6.6
|
)%
|
|
(2,905
|
)
|
|
(2.7
|
)%
|
||
Other income, net
|
|
2,969
|
|
|
2.9
|
%
|
|
77
|
|
|
0.1
|
%
|
||
Gain (loss) from foreign currency transactions
|
|
38
|
|
|
—
|
%
|
|
(922
|
)
|
|
(0.9
|
)%
|
||
Loss before income tax provision
|
|
(26,343
|
)
|
|
(25.8
|
)%
|
|
(50,035
|
)
|
|
(47.2
|
)%
|
||
Income tax provision
|
|
(1,171
|
)
|
|
(1.1
|
)%
|
|
(1,415
|
)
|
|
(1.3
|
)%
|
||
Net loss
|
|
$
|
(27,514
|
)
|
|
(26.9
|
)%
|
|
$
|
(51,450
|
)
|
|
(48.6
|
)%
|
•
|
Ratings and Planning provides measurement of the behavior and characteristics of audiences of content and advertising across TV and digital platforms including computers, tablets, smartphones, and other connected devices. These products and services are designed to help customers find the most relevant viewing audience, whether that viewing is linear, time shifted/recorded, online or on-demand.
|
•
|
Analytics and Optimization includes activation and survey-based products that provide end-to-end solutions for planning, optimization and evaluation of advertising campaigns and brand protection.
|
•
|
Movies Reporting and Analytics measures movie viewership and box office results by capturing movie ticket sales in real time or near real time and includes box office analytics, trend analysis and insights for movie studios and movie theater operators worldwide.
|
|
Three Months Ended March 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Variance
|
|
% Variance
|
|||||||||
Ratings and Planning
|
$
|
70,577
|
|
|
69.0
|
%
|
|
$
|
69,569
|
|
|
65.7
|
%
|
|
$
|
1,008
|
|
|
1.4
|
%
|
Analytics and Optimization
|
21,458
|
|
|
21.0
|
%
|
|
25,731
|
|
|
24.3
|
%
|
|
(4,273
|
)
|
|
(16.6
|
)%
|
|||
Movies Reporting and Analytics
|
10,259
|
|
|
10.0
|
%
|
|
10,619
|
|
|
10.0
|
%
|
|
(360
|
)
|
|
(3.4
|
)%
|
|||
Total revenues
|
$
|
102,294
|
|
|
100.0
|
%
|
|
$
|
105,919
|
|
|
100.0
|
%
|
|
$
|
(3,625
|
)
|
|
(3.4
|
)%
|
|
Three Months Ended March 31,
|
|
|
|||||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Data costs
|
$
|
16,061
|
|
|
15.7
|
%
|
|
$
|
12,316
|
|
|
11.6
|
%
|
|
$
|
3,745
|
|
|
30.4
|
%
|
Employee costs
|
14,965
|
|
|
14.6
|
%
|
|
13,860
|
|
|
13.1
|
%
|
|
1,105
|
|
|
8.0
|
%
|
|||
Panel costs
|
5,438
|
|
|
5.3
|
%
|
|
5,619
|
|
|
5.3
|
%
|
|
(181
|
)
|
|
(3.2
|
)%
|
|||
Systems and bandwidth costs
|
5,281
|
|
|
5.2
|
%
|
|
5,925
|
|
|
5.6
|
%
|
|
(644
|
)
|
|
(10.9
|
)%
|
|||
Lease expense and depreciation
(1)
|
3,411
|
|
|
3.3
|
%
|
|
3,302
|
|
|
3.1
|
%
|
|
109
|
|
|
3.3
|
%
|
|||
Sample and survey costs
|
2,449
|
|
|
2.4
|
%
|
|
1,716
|
|
|
1.6
|
%
|
|
733
|
|
|
42.7
|
%
|
|||
Professional fees
|
2,332
|
|
|
2.3
|
%
|
|
1,574
|
|
|
1.5
|
%
|
|
758
|
|
|
48.2
|
%
|
|||
Technology
|
1,472
|
|
|
1.4
|
%
|
|
1,534
|
|
|
1.4
|
%
|
|
(62
|
)
|
|
(4.0
|
)%
|
|||
Royalties and resellers
|
906
|
|
|
0.9
|
%
|
|
449
|
|
|
0.4
|
%
|
|
457
|
|
|
101.8
|
%
|
|||
Other
|
1,092
|
|
|
1.1
|
%
|
|
959
|
|
|
0.9
|
%
|
|
133
|
|
|
13.9
|
%
|
|||
Total cost of revenues
|
$
|
53,407
|
|
|
52.2
|
%
|
|
$
|
47,254
|
|
|
44.6
|
%
|
|
$
|
6,153
|
|
|
13.0
|
%
|
|
Three Months Ended March 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
20,363
|
|
|
19.9
|
%
|
|
$
|
20,238
|
|
|
19.1
|
%
|
|
$
|
125
|
|
|
0.6
|
%
|
Lease expense and depreciation
(1)
|
1,606
|
|
|
1.6
|
%
|
|
2,148
|
|
|
2.0
|
%
|
|
(542
|
)
|
|
(25.2
|
)%
|
|||
Travel
|
824
|
|
|
0.8
|
%
|
|
1,006
|
|
|
0.9
|
%
|
|
(182
|
)
|
|
(18.1
|
)%
|
|||
Professional fees
|
706
|
|
|
0.7
|
%
|
|
1,165
|
|
|
1.1
|
%
|
|
(459
|
)
|
|
(39.4
|
)%
|
|||
Other
|
1,341
|
|
|
1.3
|
%
|
|
1,348
|
|
|
1.3
|
%
|
|
(7
|
)
|
|
(0.5
|
)%
|
|||
Total selling and marketing expenses
|
$
|
24,840
|
|
|
24.3
|
%
|
|
$
|
25,905
|
|
|
24.5
|
%
|
|
$
|
(1,065
|
)
|
|
(4.1
|
)%
|
|
Three Months Ended March 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
13,770
|
|
|
13.5
|
%
|
|
$
|
14,666
|
|
|
13.8
|
%
|
|
$
|
(896
|
)
|
|
(6.1
|
)%
|
Lease expense and depreciation
(1)
|
1,568
|
|
|
1.5
|
%
|
|
1,827
|
|
|
1.7
|
%
|
|
(259
|
)
|
|
(14.2
|
)%
|
|||
Professional fees
|
1,369
|
|
|
1.3
|
%
|
|
522
|
|
|
0.5
|
%
|
|
847
|
|
|
162.3
|
%
|
|||
Technology
|
1,079
|
|
|
1.1
|
%
|
|
1,312
|
|
|
1.2
|
%
|
|
(233
|
)
|
|
(17.8
|
)%
|
|||
Other
|
430
|
|
|
0.4
|
%
|
|
389
|
|
|
0.4
|
%
|
|
41
|
|
|
10.5
|
%
|
|||
Total research and development expenses
|
$
|
18,216
|
|
|
17.8
|
%
|
|
$
|
18,716
|
|
|
17.7
|
%
|
|
$
|
(500
|
)
|
|
(2.7
|
)%
|
|
Three Months Ended March 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
11,261
|
|
|
11.0
|
%
|
|
$
|
6,641
|
|
|
6.3
|
%
|
|
$
|
4,620
|
|
|
69.6
|
%
|
Professional fees
|
4,789
|
|
|
4.7
|
%
|
|
5,743
|
|
|
5.4
|
%
|
|
(954
|
)
|
|
(16.6
|
)%
|
|||
Transition services agreement
|
667
|
|
|
0.7
|
%
|
|
2,665
|
|
|
2.5
|
%
|
|
(1,998
|
)
|
|
(75.0
|
)%
|
|||
Lease expense and depreciation
(1)
|
660
|
|
|
0.6
|
%
|
|
1,089
|
|
|
1.0
|
%
|
|
(429
|
)
|
|
(39.4
|
)%
|
|||
Other
|
2,168
|
|
|
2.1
|
%
|
|
2,523
|
|
|
2.4
|
%
|
|
(355
|
)
|
|
(14.1
|
)%
|
|||
Total general and administrative expenses
|
$
|
19,545
|
|
|
19.1
|
%
|
|
$
|
18,661
|
|
|
17.6
|
%
|
|
$
|
884
|
|
|
4.7
|
%
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Change in fair value of financing derivatives
|
$
|
4,100
|
|
|
$
|
(2,180
|
)
|
Change in fair value of investment in equity securities
|
(1,712
|
)
|
|
(449
|
)
|
||
Transition services agreement income
|
534
|
|
|
2,665
|
|
||
Other
|
47
|
|
|
41
|
|
||
Total other income, net
|
$
|
2,969
|
|
|
$
|
77
|
|
•
|
Adjusted EBITDA does not reflect tax or interest payments that represent a reduction in cash available to us (or, in the case of interest paid in Common Stock, that represent additional dilution to our existing stockholders);
|
•
|
Depreciation and amortization are non-cash charges and the assets being depreciated may have to be replaced in the future. Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
|
•
|
Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not reflect cash payments relating to litigation and the Audit Committee investigation, such as litigation and investigation-related costs, costs associated with tax projects, restructuring (income) expense, audits and other professional, consulting or other fees incurred in connection with our prior-year audits and certain legal proceedings, all of which represent a reduction in cash available to us;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider the impact of stock-based compensation and similar arrangements;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider amortization of intangible assets;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider possible cash gains or losses related to our financing derivatives or investment in equity securities; and
|
•
|
Other companies, including companies in our industry, may calculate any of these non-GAAP financial measures differently, which reduces their usefulness as comparative measures.
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Net loss (GAAP)
|
$
|
(27,514
|
)
|
|
$
|
(51,450
|
)
|
|
|
|
|
||||
Income tax provision
|
1,171
|
|
|
1,415
|
|
||
Interest expense, net
|
6,759
|
|
|
2,905
|
|
||
Depreciation
|
3,106
|
|
|
4,563
|
|
||
Finance lease amortization expense
|
574
|
|
|
—
|
|
||
Amortization of intangible assets
|
8,105
|
|
|
8,544
|
|
||
EBITDA
|
(7,799
|
)
|
|
(34,023
|
)
|
||
|
|
|
|
||||
Adjustments:
|
|
|
|
||||
Stock-based compensation
|
6,953
|
|
|
1,881
|
|
||
Investigation and audit related
|
842
|
|
|
31,867
|
|
||
Restructuring (income) expense
|
(70
|
)
|
|
1,257
|
|
||
Other (income) expense, net
(1)
|
(2,388
|
)
|
|
2,629
|
|
||
Adjusted EBITDA
|
$
|
(2,462
|
)
|
|
$
|
3,611
|
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Net loss (GAAP)
|
$
|
(27,514
|
)
|
|
$
|
(51,450
|
)
|
|
|
|
|
||||
Adjustments:
|
|
|
|
||||
Stock-based compensation
|
6,953
|
|
|
1,881
|
|
||
Investigation and audit related
|
842
|
|
|
31,867
|
|
||
Amortization of intangible assets
(1)
|
8,105
|
|
|
8,544
|
|
||
Restructuring (income) expense
|
(70
|
)
|
|
1,257
|
|
||
Other (income) expense, net
(2)
|
(2,388
|
)
|
|
2,629
|
|
||
Non-GAAP net loss
|
$
|
(14,072
|
)
|
|
$
|
(5,272
|
)
|
|
|
Three Months Ended March 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Condensed Consolidated Statements of Cash Flow Data
|
|
|
|
|
||||
Net cash used in operating activities
|
|
$
|
(1,576
|
)
|
|
$
|
(44,798
|
)
|
Net cash used in investing activities
|
|
(4,240
|
)
|
|
(2,657
|
)
|
||
Net cash (used in) provided by financing activities
|
|
(1,464
|
)
|
|
76,792
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
(75
|
)
|
|
368
|
|
||
Net (decrease) increase in cash, cash equivalents and restricted cash
|
|
(7,355
|
)
|
|
29,705
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
If the Conversion Premium
(as of the applicable
Interest Reset Date) is:
|
|
Implied VWAP
|
|
Then the Interest Rate from
the applicable Interest Reset
Date until the next
subsequent Interest Reset
Date shall be:
|
1.0 or less
|
|
$31.29 or higher
|
|
4.0%
|
1.05
|
|
$29.80
|
|
4.3%
|
1.10
|
|
$28.45
|
|
4.7%
|
1.15
|
|
$27.21
|
|
5.0%
|
1.20
|
|
$26.08
|
|
5.3%
|
1.25
|
|
$25.03
|
|
5.7%
|
1.30
|
|
$24.07
|
|
6.0%
|
1.35
|
|
$23.18
|
|
8.0%
|
1.40
|
|
$22.35
|
|
10.0%
|
1.45 or higher
|
|
$21.58 or less
|
|
12.0%
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
|
COM
S
CORE
, I
NC
.
|
|||
|
|
|
||
|
By:
|
/s/ Gregory A. Fink
|
||
|
|
Gregory A. Fink
|
||
|
|
Chief Financial Officer and Treasurer
|
||
|
|
(Principal Financial Officer, Principal Accounting Officer and Duly Authorized Officer)
|
/s/ Dale Fuller
|
Dale Fuller
|
Interim Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|
/s/ Dale Fuller
|
Dale Fuller
|
Interim Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|