|
☑
|
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)
|
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
|
Large accelerated filer
|
|
☑
|
|
Accelerated filer
|
|
☐
|
Non-accelerated filer
|
|
☐
|
|
Smaller reporting company
|
|
☐
|
|
|
|
|
Emerging growth company
|
|
☐
|
|
|
|
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
As of
|
|
As of
|
||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(Unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
53,839
|
|
|
$
|
44,096
|
|
Restricted cash
|
4,651
|
|
|
6,102
|
|
||
Accounts receivable, net of allowances of $2,182 and $1,597, respectively ($3,936 and $4,024 of accounts receivable attributable to related parties, respectively)
|
59,417
|
|
|
75,609
|
|
||
Prepaid expenses and other current assets ($1,009 and $484 attributable to related parties, respectively)
|
16,217
|
|
|
19,972
|
|
||
Total current assets
|
134,124
|
|
|
145,779
|
|
||
Property and equipment, net
|
32,609
|
|
|
27,339
|
|
||
Operating right-of-use assets
|
37,923
|
|
|
—
|
|
||
Other non-current assets
|
2,363
|
|
|
8,898
|
|
||
Deferred tax assets
|
2,521
|
|
|
3,991
|
|
||
Intangible assets, net
|
86,483
|
|
|
126,945
|
|
||
Goodwill
|
415,806
|
|
|
641,191
|
|
||
Total assets
|
$
|
711,829
|
|
|
$
|
954,143
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable ($2,304 and $1,878 attributable to related parties, respectively)
|
$
|
44,921
|
|
|
$
|
29,836
|
|
Accrued expenses ($891 and $4,478 attributable to related parties, respectively)
|
48,108
|
|
|
58,140
|
|
||
Accrued litigation settlements
|
6,750
|
|
|
3,500
|
|
||
Contract liability ($2,254 and $2,521 attributable to related parties, respectively)
|
51,852
|
|
|
64,189
|
|
||
Customer advances
|
7,706
|
|
|
6,688
|
|
||
Warrants liability
|
5,905
|
|
|
—
|
|
||
Current operating lease liabilities
|
6,784
|
|
|
—
|
|
||
Other current liabilities
|
3,788
|
|
|
6,583
|
|
||
Total current liabilities
|
175,814
|
|
|
168,936
|
|
||
Financing derivatives (related parties)
|
23,200
|
|
|
26,100
|
|
||
Senior secured convertible notes (related parties)
|
182,744
|
|
|
177,342
|
|
||
Non-current operating lease liabilities
|
44,171
|
|
|
—
|
|
||
Deferred rent
|
—
|
|
|
10,304
|
|
||
Deferred tax liabilities
|
325
|
|
|
5,527
|
|
||
Other non-current liabilities ($6,120 and $251 attributable to related parties)
|
20,355
|
|
|
14,367
|
|
||
Total liabilities
|
446,609
|
|
|
402,576
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value per share; 5,000,000 shares authorized at September 30, 2019 and December 31, 2018; no shares issued or outstanding as of September 30, 2019 and December 31, 2018
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value per share; 150,000,000 shares authorized as of September 30, 2019 and December 31, 2018; 70,955,367 shares issued and 64,190,571 shares outstanding as of September 30, 2019, and 66,154,626 shares issued and 59,389,830 shares outstanding as of December 31, 2018
|
64
|
|
|
59
|
|
||
Additional paid-in capital
|
1,595,402
|
|
|
1,561,208
|
|
||
Accumulated other comprehensive loss
|
(13,515
|
)
|
|
(10,621
|
)
|
||
Accumulated deficit
|
(1,086,747
|
)
|
|
(769,095
|
)
|
||
Treasury stock, at cost, 6,764,796 shares as of September 30, 2019 and December 31, 2018
|
(229,984
|
)
|
|
(229,984
|
)
|
||
Total stockholders' equity
|
265,220
|
|
|
551,567
|
|
||
Total liabilities and stockholders’ equity
|
$
|
711,829
|
|
|
$
|
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
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(279,533
|
)
|
|
—
|
|
|
(279,533
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
677
|
|
|
—
|
|
|
—
|
|
|
677
|
|
||||||
Issuance of Common Stock
|
2,728,513
|
|
|
3
|
|
|
7,575
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,578
|
|
||||||
Common Stock warrants exercised
|
323,448
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest paid in Common Stock
|
243,261
|
|
|
—
|
|
|
5,134
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,134
|
|
||||||
Restricted stock units vested
|
46,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(7,218
|
)
|
|
—
|
|
|
(72
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(72
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
2,354
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,354
|
|
||||||
Balance as of June 30, 2019
|
63,291,969
|
|
|
$
|
63
|
|
|
$
|
1,586,750
|
|
|
$
|
(10,565
|
)
|
|
$
|
(1,076,188
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
270,076
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,559
|
)
|
|
—
|
|
|
(10,559
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,950
|
)
|
|
—
|
|
|
—
|
|
|
(2,950
|
)
|
||||||
Adjustment to issuance of Common Stock
|
—
|
|
|
—
|
|
|
584
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
584
|
|
||||||
Interest paid in Common Stock
|
856,289
|
|
|
1
|
|
|
6,119
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,120
|
|
||||||
Restricted stock units vested
|
54,899
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(12,586
|
)
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
1,966
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,966
|
|
||||||
Balance as of September 30, 2019
|
64,190,571
|
|
|
$
|
64
|
|
|
$
|
1,595,402
|
|
|
$
|
(13,515
|
)
|
|
$
|
(1,086,747
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
265,220
|
|
|
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
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(55,977
|
)
|
|
—
|
|
|
(55,977
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,975
|
)
|
|
—
|
|
|
—
|
|
|
(3,975
|
)
|
||||||
Subscription receivable
|
—
|
|
|
—
|
|
|
1,611
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,611
|
|
||||||
Exercise of Common Stock options, net
|
21,809
|
|
|
—
|
|
|
164
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
164
|
|
||||||
Shares issued in connection with settlement of litigation
|
4,024,115
|
|
|
4
|
|
|
90,764
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
90,768
|
|
||||||
Repurchase of Common Stock in exchange for senior secured convertible notes
|
(1,400,000
|
)
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30,444
|
)
|
|
(30,451
|
)
|
||||||
Restricted stock units vested
|
233,320
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(9,996
|
)
|
|
—
|
|
|
(176
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(176
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
22,248
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,248
|
|
||||||
Balance as of June 30, 2018
|
57,886,918
|
|
|
$
|
58
|
|
|
$
|
1,528,719
|
|
|
$
|
(8,584
|
)
|
|
$
|
(717,254
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
572,955
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,637
|
)
|
|
—
|
|
|
(24,637
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(429
|
)
|
|
—
|
|
|
—
|
|
|
(429
|
)
|
||||||
Subscription receivable
|
—
|
|
|
—
|
|
|
3,890
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,890
|
|
||||||
Exercise of Common Stock options, net
|
200,420
|
|
|
—
|
|
|
2,691
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,691
|
|
||||||
Restricted stock units vested
|
829,925
|
|
|
1
|
|
|
10,297
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,298
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(17,628
|
)
|
|
—
|
|
|
(388
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(388
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
4,162
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,162
|
|
||||||
Balance as of September 30, 2018
|
58,899,635
|
|
|
$
|
59
|
|
|
$
|
1,549,371
|
|
|
$
|
(9,013
|
)
|
|
$
|
(741,891
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
568,542
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Operating activities:
|
|
|
|
||||
Net loss
|
$
|
(317,606
|
)
|
|
$
|
(132,064
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation
|
9,447
|
|
|
12,974
|
|
||
Non-cash operating lease expense
|
3,987
|
|
|
—
|
|
||
Amortization expense of finance leases
|
1,974
|
|
|
—
|
|
||
Amortization of intangible assets
|
23,151
|
|
|
24,706
|
|
||
Impairment of goodwill
|
224,272
|
|
|
—
|
|
||
Impairment of intangible asset (related party)
|
17,308
|
|
|
—
|
|
||
Stock-based compensation
|
14,133
|
|
|
31,191
|
|
||
Deferred tax (benefit) provision
|
(3,951
|
)
|
|
2,828
|
|
||
Change in fair value of financing derivatives
|
(2,900
|
)
|
|
10,141
|
|
||
Change in fair value of warrant liability
|
(4,893
|
)
|
|
—
|
|
||
Change in fair value of investment in equity securities
|
2,324
|
|
|
(307
|
)
|
||
Non-cash interest expense on senior secured convertible notes (related party)
|
17,374
|
|
|
—
|
|
||
Accretion of debt discount
|
4,607
|
|
|
3,327
|
|
||
Amortization of deferred financing costs
|
795
|
|
|
703
|
|
||
Other
|
657
|
|
|
560
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|||
Accounts receivable
|
14,951
|
|
|
19,480
|
|
||
Prepaid expenses and other assets
|
2,115
|
|
|
3,502
|
|
||
Accounts payable, accrued expenses, accrued litigation settlements and other liabilities
|
6,913
|
|
|
(22,449
|
)
|
||
Contract liability and customer advances
|
(11,748
|
)
|
|
(28,531
|
)
|
||
Operating lease liabilities
|
(6,034
|
)
|
|
—
|
|
||
Net cash used in operating activities
|
(3,124
|
)
|
|
(73,939
|
)
|
||
|
|
|
|
||||
Investing activities:
|
|
|
|
||||
Proceeds from sale of investment in equity securities
|
3,776
|
|
|
—
|
|
||
Purchases of property and equipment
|
(2,810
|
)
|
|
(2,183
|
)
|
||
Capitalized internal-use software costs
|
(8,800
|
)
|
|
(7,447
|
)
|
||
Net cash used in investing activities
|
(7,834
|
)
|
|
(9,630
|
)
|
||
|
|
|
|
||||
Financing activities:
|
|
|
|
||||
Proceeds from borrowings on senior secured convertible notes (related party)
|
—
|
|
|
100,000
|
|
||
Debt issuance costs
|
—
|
|
|
(5,132
|
)
|
||
Proceeds from private placement, net of issuance costs paid
|
19,769
|
|
|
—
|
|
||
Financing proceeds received on subscription receivable (related party)
|
—
|
|
|
7,998
|
|
||
Proceeds from sale-leaseback financing transaction
|
4,252
|
|
|
—
|
|
||
Proceeds from the exercise of stock options
|
1,191
|
|
|
2,855
|
|
||
Payments for taxes related to net share settlement of equity awards
|
(1,227
|
)
|
|
(4,663
|
)
|
||
Principal payments on finance leases
|
(2,080
|
)
|
|
—
|
|
||
Principal payments on capital lease and software license arrangements
|
(1,997
|
)
|
|
(7,260
|
)
|
||
Net cash provided by financing activities
|
19,908
|
|
|
93,798
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(658
|
)
|
|
(1,140
|
)
|
||
Net increase in cash, cash equivalents and restricted cash
|
8,292
|
|
|
9,089
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
50,198
|
|
|
45,125
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
58,490
|
|
|
$
|
54,214
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
||||
|
As of September 30,
|
||||||
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
53,839
|
|
|
$
|
47,876
|
|
Restricted cash
|
4,651
|
|
|
6,338
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
58,490
|
|
|
$
|
54,214
|
|
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Supplemental cash flow disclosures:
|
|
|
|
||||
Interest paid ($3,046 and $4,467 attributable to related party)
|
$
|
3,825
|
|
|
$
|
5,069
|
|
Income taxes paid, net of refunds
|
877
|
|
|
666
|
|
||
|
|
|
|
||||
Supplemental disclosures of non-cash activities:
|
|
|
|
||||
Leasehold improvements acquired through lease incentives
|
$
|
1,850
|
|
|
$
|
—
|
|
Change in accounts payable and accrued expenses related to capital expenditures
|
951
|
|
|
894
|
|
||
Settlement of restricted stock unit liability
|
4,611
|
|
|
10,298
|
|
||
Fair value of warrants issued in private placement
|
10,798
|
|
|
—
|
|
||
Repurchase of Common Stock in exchange for senior secured convertible notes
|
—
|
|
|
94,021
|
|
||
Shares issued in connection with settlement of litigation
|
—
|
|
|
90,768
|
|
||
Insurance recovery on litigation settlement
|
—
|
|
|
27,232
|
|
||
Common Stock warrants issued with senior secured convertible notes
|
—
|
|
|
5,733
|
|
||
Fair value of financing derivatives issued with senior secured convertible notes
|
—
|
|
|
17,359
|
|
||
Notes Option derivative liability settlement
|
—
|
|
|
5,700
|
|
||
Modification of debt in consideration for the reduction of the senior secured convertible note minimum cash balance requirement
|
—
|
|
|
2,000
|
|
1.
|
Organization
|
2.
|
Summary of Significant Accounting Policies
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Change in fair value of financing derivatives
|
$
|
1,800
|
|
|
$
|
(5,681
|
)
|
|
$
|
2,900
|
|
|
$
|
(10,141
|
)
|
Change in fair value of warrants liability
|
4,893
|
|
|
—
|
|
|
4,893
|
|
|
—
|
|
||||
Change in fair value of investment in equity securities
|
(308
|
)
|
|
42
|
|
|
(2,324
|
)
|
|
307
|
|
||||
Transition services agreement income
|
—
|
|
|
2,120
|
|
|
534
|
|
|
6,967
|
|
||||
Other
|
348
|
|
|
1,808
|
|
|
618
|
|
|
2,040
|
|
||||
Total other income (expense), net
|
$
|
6,733
|
|
|
$
|
(1,711
|
)
|
|
$
|
6,621
|
|
|
$
|
(827
|
)
|
•
|
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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
By Solution group:
|
|
|
|
|
|
|
|
|
||||||||
Ratings and Planning
|
|
$
|
65,334
|
|
|
$
|
70,499
|
|
|
$
|
204,833
|
|
|
$
|
210,569
|
|
Analytics and Optimization
|
|
18,252
|
|
|
22,215
|
|
|
57,003
|
|
|
68,479
|
|
||||
Movies Reporting and Analytics
|
|
10,714
|
|
|
10,150
|
|
|
31,646
|
|
|
31,124
|
|
||||
Total
|
|
$
|
94,300
|
|
|
$
|
102,864
|
|
|
$
|
293,482
|
|
|
$
|
310,172
|
|
By Geographical market:
|
|
|
|
|
|
|
|
|
||||||||
United States
|
|
$
|
81,957
|
|
|
$
|
90,250
|
|
|
$
|
253,904
|
|
|
$
|
269,532
|
|
Europe
|
|
7,078
|
|
|
8,014
|
|
|
22,994
|
|
|
26,022
|
|
||||
Latin America
|
|
2,192
|
|
|
2,407
|
|
|
6,878
|
|
|
7,016
|
|
||||
Canada
|
|
1,691
|
|
|
1,487
|
|
|
5,289
|
|
|
5,441
|
|
||||
Other
|
|
1,382
|
|
|
706
|
|
|
4,417
|
|
|
2,161
|
|
||||
Total
|
|
$
|
94,300
|
|
|
$
|
102,864
|
|
|
$
|
293,482
|
|
|
$
|
310,172
|
|
By Timing of revenue recognition:
|
|
|
|
|
|
|
|
|
||||||||
Products and services transferred at a point in time
|
|
$
|
23,397
|
|
|
$
|
22,689
|
|
|
$
|
70,938
|
|
|
$
|
80,264
|
|
Products and services transferred over time
|
|
70,903
|
|
|
80,175
|
|
|
222,544
|
|
|
229,908
|
|
||||
Total
|
|
$
|
94,300
|
|
|
$
|
102,864
|
|
|
$
|
293,482
|
|
|
$
|
310,172
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Accounts receivable, net
|
|
$
|
59,417
|
|
|
$
|
75,609
|
|
Current and non-current contract assets
|
|
1,577
|
|
|
2,438
|
|
||
Current and non-current contract costs
|
|
1,073
|
|
|
1,402
|
|
||
Current contract liability
|
|
51,852
|
|
|
64,189
|
|
||
Current customer advances
|
|
7,706
|
|
|
6,688
|
|
||
Non-current contract liability
|
|
314
|
|
|
508
|
|
|
Contract Liability (Current)
|
||||||
|
Nine Months Ended September 30,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Revenue recognized that was included in the contract liability balance at the beginning of period
|
$
|
(55,607
|
)
|
|
$
|
(81,254
|
)
|
Cash received or amounts billed in advance and not recognized as revenue
|
44,472
|
|
|
54,023
|
|
4.
|
Goodwill and Intangible Assets
|
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||||||||||||||||
(In thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Accumulated Impairment
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||||
Acquired methodologies/technology
|
|
$
|
148,357
|
|
|
$
|
(81,746
|
)
|
|
$
|
—
|
|
|
$
|
66,611
|
|
|
$
|
148,374
|
|
|
$
|
(66,690
|
)
|
|
$
|
81,684
|
|
Strategic alliance
|
|
30,100
|
|
|
(12,792
|
)
|
|
(17,308
|
)
|
|
—
|
|
|
30,100
|
|
|
(11,288
|
)
|
|
18,812
|
|
|||||||
Customer relationships
|
|
40,064
|
|
|
(24,410
|
)
|
|
—
|
|
|
15,654
|
|
|
40,127
|
|
|
(20,338
|
)
|
|
19,789
|
|
|||||||
Intellectual property
|
|
14,360
|
|
|
(12,225
|
)
|
|
—
|
|
|
2,135
|
|
|
14,366
|
|
|
(11,905
|
)
|
|
2,461
|
|
|||||||
Trade names
|
|
770
|
|
|
(677
|
)
|
|
—
|
|
|
93
|
|
|
775
|
|
|
(636
|
)
|
|
139
|
|
|||||||
Acquired software
|
|
9,287
|
|
|
(7,524
|
)
|
|
—
|
|
|
1,763
|
|
|
9,287
|
|
|
(5,531
|
)
|
|
3,756
|
|
|||||||
Other
|
|
600
|
|
|
(373
|
)
|
|
—
|
|
|
227
|
|
|
600
|
|
|
(296
|
)
|
|
304
|
|
|||||||
Total intangible assets
|
|
$
|
243,538
|
|
|
$
|
(139,747
|
)
|
|
$
|
(17,308
|
)
|
|
$
|
86,483
|
|
|
$
|
243,629
|
|
|
$
|
(116,684
|
)
|
|
$
|
126,945
|
|
|
(In years)
|
Acquired methodologies/technology
|
2.67
|
Customer relationships
|
2.84
|
Intellectual property
|
4.92
|
Trade names
|
1.50
|
Acquired software
|
1.15
|
Other
|
1.58
|
|
(In thousands)
|
||
2019
|
$
|
6,926
|
|
2020
|
27,220
|
|
|
2021
|
25,037
|
|
|
2022
|
24,567
|
|
|
2023
|
2,445
|
|
|
Thereafter
|
288
|
|
|
Total
|
$
|
86,483
|
|
5.
|
Long-term Debt
|
|
|
|
As of
|
|||||||||||
|
|
|
September 30, 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
|
|
$
|
(15,669
|
)
|
$
|
(2,973
|
)
|
$
|
134,858
|
|
Option Notes, due January 16, 2022
|
12.0%
|
14.7%
|
50,500
|
|
(2,447
|
)
|
(167
|
)
|
47,886
|
|
||||
Total
|
|
|
$
|
204,000
|
|
$
|
(18,116
|
)
|
$
|
(3,140
|
)
|
$
|
182,744
|
|
|
|
|
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
|
|
6.
|
Stockholders' Equity
|
•
|
Stock price: The stock price was measured using the fair value of the Common Stock on the Closing Date, which was $5.57 per share.
|
•
|
Volatility: The Company determined volatility to be 50.0% based on (i) the historical volatility of the Common Stock daily volume weighted average price with a look-back period commensurate with the term of the warrants and (ii) options-based implied volatility.
|
•
|
Risk-free rate: Management assumed the risk-free rate to be between 1.7% and 2.1%, based on the U.S. Treasury bonds on the valuation date with terms commensurate with the terms of each warrant.
|
•
|
Dividend yield: Management assumed the dividend yield to be zero based on the historical payout of the Company.
|
•
|
Term: Management determined the term based on the time period of each warrant's maturity, between six months and five years from the Closing Date.
|
•
|
Cost of debt: Management assumed the cost of debt to be between 16.7% and 18.7% based on a synthetic credit rating analysis.
|
•
|
Change of control probability: The Company utilized a range between 0.0% and 10.0% to estimate the likelihood of occurrence.
|
(in thousands)
|
Warrants Liability
|
||
Series A Warrant
|
$
|
3,862
|
|
Series B-1 Warrant
|
328
|
|
|
Series B-2 Warrant
|
376
|
|
|
Series C Warrant
|
6,232
|
|
|
Total
|
$
|
10,798
|
|
Unvested Stock Awards
|
|
Restricted
Stock Units
|
|
Number of
Shares
Underlying
Awards
|
|
Weighted
Average
Grant-Date
Fair Value
|
||||
Unvested as of December 31, 2018
|
|
1,466,135
|
|
|
1,466,135
|
|
|
$
|
22.62
|
|
Granted
|
|
1,364,244
|
|
|
1,364,244
|
|
|
12.67
|
|
|
Vested and delivered
|
|
(653,628
|
)
|
|
(653,628
|
)
|
|
24.74
|
|
|
Forfeited
|
|
(466,789
|
)
|
|
(466,789
|
)
|
|
18.16
|
|
|
Unvested as of September 30, 2019
|
|
1,709,962
|
|
|
1,709,962
|
|
|
$
|
15.04
|
|
Unvested Stock Awards
|
|
Restricted
Stock Awards
|
|
Restricted
Stock Units
|
|
Number of
Shares
Underlying
Awards
|
|
Weighted
Average
Grant-Date
Fair Value
|
|||||
Unvested as of December 31, 2017
|
|
2,125
|
|
|
779,912
|
|
|
782,037
|
|
|
$
|
37.22
|
|
Granted
|
|
—
|
|
|
2,688,031
|
|
|
2,688,031
|
|
|
22.92
|
|
|
Vested and delivered
|
|
(2,125
|
)
|
|
(1,550,272
|
)
|
|
(1,552,397
|
)
|
|
28.42
|
|
|
Forfeited
|
|
—
|
|
|
(72,490
|
)
|
|
(72,490
|
)
|
|
30.68
|
|
|
Unvested as of September 30, 2018
|
|
—
|
|
|
1,845,181
|
|
|
1,845,181
|
|
|
$
|
24.07
|
|
Dividend yield
|
0.0%
|
|||
Expected volatility
|
44.9
|
%
|
-
|
52.9%
|
Risk-free interest rate
|
1.3
|
%
|
-
|
2.7%
|
Expected life of options (in years)
|
5.21
|
|
-
|
10.00
|
|
|
Number of
shares
|
|
Weighted-Average
Exercise Price
|
|||
Options outstanding as of December 31, 2018
|
|
1,045,913
|
|
|
$
|
17.89
|
|
Options granted
|
|
465,000
|
|
|
7.30
|
|
|
Options exercised
|
|
(68,259
|
)
|
|
17.44
|
|
|
Options forfeited
|
|
(361,962
|
)
|
|
15.14
|
|
|
Options outstanding as of September 30, 2019
|
|
1,080,692
|
|
|
$
|
14.39
|
|
Options exercisable as of September 30, 2019
|
|
694,442
|
|
|
$
|
18.17
|
|
|
|
Number of
shares
|
|
Weighted-Average
Exercise Price
|
|||
Options outstanding as of December 31, 2017
|
|
3,444,252
|
|
|
$
|
30.65
|
|
Options exercised (1)
|
|
(347,752
|
)
|
|
15.45
|
|
|
Options expired
|
|
(1,987,107
|
)
|
|
40.43
|
|
|
Options outstanding as of September 30, 2018
|
|
1,109,393
|
|
|
$
|
17.91
|
|
Options exercisable as of September 30, 2018
|
|
1,109,393
|
|
|
$
|
17.91
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of Exercise Prices
|
|
Options Outstanding
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Life (Years) |
|
Options
Exercisable
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (Years)
|
||||||
$1.88 - $3.00
|
|
175,000
|
|
|
$
|
2.52
|
|
|
9.95
|
|
43,750
|
|
|
$
|
2.52
|
|
|
9.95
|
$10.00 - $19.31
|
|
640,110
|
|
|
12.99
|
|
|
5.62
|
|
385,110
|
|
|
14.84
|
|
|
2.94
|
||
$20.11 - $25.86
|
|
259,525
|
|
|
25.22
|
|
|
1.41
|
|
259,525
|
|
|
25.22
|
|
|
1.41
|
||
$40.80
|
|
6,057
|
|
|
40.80
|
|
|
4.87
|
|
6,057
|
|
|
40.80
|
|
|
4.87
|
||
|
|
1,080,692
|
|
|
$
|
14.39
|
|
|
5.31
|
|
694,442
|
|
|
$
|
18.17
|
|
|
2.83
|
7.
|
Fair Value Measurements
|
|
As of
|
|
As of
|
||||||||||||||||||||||||||||
|
September 30, 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)
|
$
|
28,201
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,201
|
|
|
$
|
6,037
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,037
|
|
Investment in equity securities (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,100
|
|
|
—
|
|
|
—
|
|
|
6,100
|
|
||||||||
Total assets
|
$
|
28,201
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,201
|
|
|
$
|
12,137
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,137
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financing derivatives: no hedging designation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate reset (3)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,000
|
|
|
$
|
21,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23,300
|
|
|
$
|
23,300
|
|
Change of control redemption (4)
|
—
|
|
|
—
|
|
|
2,200
|
|
|
2,200
|
|
|
—
|
|
|
—
|
|
|
2,800
|
|
|
2,800
|
|
||||||||
Warrants issued: (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Series A
|
—
|
|
|
—
|
|
|
717
|
|
|
717
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Series C
|
—
|
|
|
—
|
|
|
5,188
|
|
|
5,188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29,105
|
|
|
$
|
29,105
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,100
|
|
|
$
|
26,100
|
|
(In thousands)
|
|
Financing Derivative Liabilities
|
||
Balance as of December 31, 2018
|
|
$
|
26,100
|
|
Total gain included in other expense (income), net (1)
|
|
(2,900
|
)
|
|
Balance as of September 30, 2019
|
|
$
|
23,200
|
|
(In thousands)
|
|
Financing Derivative Liabilities
|
||
Balance as of December 31, 2017
|
|
$
|
—
|
|
Issuances
|
|
17,359
|
|
|
Total loss included in other expense (income), net (1)
|
|
10,141
|
|
|
Settlement
|
|
(5,700
|
)
|
|
Balance as of September 30, 2018
|
|
$
|
21,800
|
|
(In thousands)
|
|
Warrants Liability
|
||
Balance as of December 31, 2018
|
|
$
|
—
|
|
Issuance of warrants liability
|
|
10,798
|
|
|
Total gain included in other expense (income), net (1)
|
|
(4,893
|
)
|
|
Balance as of September 30, 2019
|
|
$
|
5,905
|
|
|
Fair value measurements
|
||||||||
|
Significant valuation technique
|
|
Significant unobservable inputs
|
|
September 30, 2019
|
|
December 31, 2018
|
||
Interest rate reset derivative liability
|
Discounted cash flow
|
|
Discount rate
|
|
25.0%
|
|
25.0%
|
||
|
|
|
Stock price
|
|
$1.91
|
|
$14.43
|
||
|
|
|
Risk-free rate
|
|
1.6%
|
|
2.5%
|
||
|
|
|
Volatility
|
|
60.7%
|
|
43.9%
|
||
|
|
|
Term
|
|
2.29 years
|
|
3.04 years
|
||
|
|
|
|
|
|
|
|
||
Change of control redemption derivative liability
|
Option pricing model
|
|
Probability
|
|
0.0 - 10.0%
|
|
0.0 - 10.0%
|
||
|
|
|
Risk-free rate
|
|
1.6%
|
|
2.5%
|
||
|
|
|
|
|
|
|
|
|
|
Warrants liability
|
Option pricing model
|
|
Stock price
|
|
$1.91
|
|
|
||
|
|
|
|
Volatility
|
|
60.0%
|
|
|
|
|
|
|
|
Risk-free rate
|
|
1.6 - 1.8%
|
|
|
|
|
|
|
|
Dividend yield
|
|
0.0%
|
|
|
|
|
|
|
|
Term
|
|
0.24 - 4.74 years
|
|
|
|
|
|
|
|
Cost of debt
|
|
14.7 - 16.2%
|
|
|
|
|
|
|
|
Change of control probability
|
|
0.0 - 10.0%
|
|
|
8.
|
Accrued Expenses
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Payroll and payroll-related
|
|
$
|
11,573
|
|
|
$
|
18,972
|
|
Accrued data costs
|
|
20,724
|
|
|
14,617
|
|
||
Professional fees
|
|
4,042
|
|
|
8,477
|
|
||
Restructuring accrual
|
|
4,345
|
|
|
5,479
|
|
||
Accrued interest on senior secured convertible notes
|
|
—
|
|
|
3,046
|
|
||
Other
|
|
7,424
|
|
|
7,549
|
|
||
Total accrued expenses
|
|
$
|
48,108
|
|
|
$
|
58,140
|
|
9.
|
Income Taxes
|
10.
|
Related Party Transactions
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues (1)
|
$
|
3,609
|
|
|
$
|
2,875
|
|
|
$
|
11,380
|
|
|
$
|
6,875
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenues
|
2,290
|
|
|
2,481
|
|
|
7,969
|
|
|
7,667
|
|
||||
Selling and marketing
|
5
|
|
|
43
|
|
|
18
|
|
|
128
|
|
||||
Research and development
|
—
|
|
|
30
|
|
|
—
|
|
|
89
|
|
||||
General and administrative
|
186
|
|
|
24
|
|
|
406
|
|
|
78
|
|
||||
Impairment of intangible asset (2)
|
—
|
|
|
—
|
|
|
17,308
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Interest income
|
—
|
|
|
55
|
|
|
—
|
|
|
330
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
|
||||
Accounts receivable, net
|
|
$
|
3,608
|
|
|
$
|
3,353
|
|
Prepaid expenses and other current assets
|
|
1,009
|
|
|
429
|
|
||
Liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,304
|
|
|
$
|
1,833
|
|
Accrued expenses
|
|
891
|
|
|
1,384
|
|
||
Contract liability
|
|
2,178
|
|
|
1,945
|
|
||
Other non-current liabilities
|
|
—
|
|
|
251
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Accrued expenses
|
|
$
|
—
|
|
|
$
|
3,046
|
|
Financing derivatives
|
|
23,200
|
|
|
26,100
|
|
||
Senior secured convertible notes
|
|
182,744
|
|
|
177,342
|
|
||
Other non-current liabilities
|
|
6,120
|
|
|
—
|
|
11.
|
Leases
|
|
|
Nine Months Ended
|
|||
(In thousands)
|
|
September 30, 2019
|
|||
Supplemental Cash Flows Information
|
|
|
|||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|||
Operating cash flows from finance leases
|
|
$
|
384
|
|
|
Operating cash flows from operating leases
|
|
12,153
|
|
||
Financing cash flows from finance leases
|
|
2,080
|
|
||
Right-of-use assets obtained in exchange for lease obligations:
|
|
|
|||
Right-of-use assets obtained in exchange for new finance lease liabilities
|
|
$
|
3,487
|
|
|
Right-of-use assets obtained in exchange for new operating lease liabilities
|
|
533
|
|
(In thousands)
|
Operating Leases
|
|
Finance Leases
|
||||
Remainder of 2019
|
$
|
3,545
|
|
|
$
|
657
|
|
2020
|
12,645
|
|
|
1,874
|
|
||
2021
|
11,987
|
|
|
1,703
|
|
||
2022
|
9,057
|
|
|
664
|
|
||
2023
|
9,728
|
|
|
42
|
|
||
Thereafter
|
31,479
|
|
|
—
|
|
||
Total lease payments
|
78,441
|
|
|
4,940
|
|
||
Less: imputed interest
|
(27,486
|
)
|
|
(727
|
)
|
||
Total lease liabilities
|
50,955
|
|
|
4,213
|
|
||
Less: current lease liabilities
|
(6,784
|
)
|
|
(1,622
|
)
|
||
Total non-current lease liabilities
|
$
|
44,171
|
|
|
$
|
2,591
|
|
(In thousands)
|
Sublease Receipts
|
||
Remainder of 2019
|
$
|
352
|
|
2020
|
1,686
|
|
|
2021
|
1,589
|
|
|
2022
|
1,556
|
|
|
2023
|
1,144
|
|
|
Thereafter
|
2,913
|
|
|
Total sublease receipts
|
$
|
9,240
|
|
|
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
|
|
12.
|
Commitments and Contingencies
|
13.
|
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(2)
|
|
(201
|
)
|
|
—
|
|
|
—
|
|
|
(201
|
)
|
||||
Payments
|
|
(2,098
|
)
|
|
—
|
|
|
—
|
|
|
(2,098
|
)
|
||||
Accrued Balance as of September 30, 2019
|
|
$
|
2,194
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,194
|
|
(In thousands)
|
|
May 2019 Restructuring Plan
|
|
August 2019 Restructuring Plan
|
||||
Accrued Balance as of December 31, 2018
|
|
$
|
—
|
|
|
$
|
—
|
|
Severance pay and benefits related restructuring expense
|
|
3,091
|
|
|
2,396
|
|
||
Payments
|
|
(2,466
|
)
|
|
(870
|
)
|
||
Accrued Balance as of September 30, 2019
|
|
$
|
625
|
|
|
$
|
1,526
|
|
14.
|
Subsequent Events
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||
(In thousands)
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
||||||||||||
Revenues
|
$
|
94,300
|
|
|
100.0
|
%
|
|
$
|
102,864
|
|
|
100.0
|
%
|
|
$
|
293,482
|
|
|
100.0
|
%
|
|
$
|
310,172
|
|
|
100.0
|
%
|
Cost of revenues
|
47,390
|
|
|
50.3
|
%
|
|
49,446
|
|
|
48.1
|
%
|
|
152,791
|
|
|
52.1
|
%
|
|
148,226
|
|
|
47.8
|
%
|
||||
Selling and marketing
|
20,421
|
|
|
21.7
|
%
|
|
24,866
|
|
|
24.2
|
%
|
|
68,590
|
|
|
23.4
|
%
|
|
80,418
|
|
|
25.9
|
%
|
||||
Research and development
|
14,064
|
|
|
14.9
|
%
|
|
18,742
|
|
|
18.2
|
%
|
|
49,163
|
|
|
16.8
|
%
|
|
58,347
|
|
|
18.8
|
%
|
||||
General and administrative
|
14,064
|
|
|
14.9
|
%
|
|
18,707
|
|
|
18.2
|
%
|
|
50,541
|
|
|
17.2
|
%
|
|
66,067
|
|
|
21.3
|
%
|
||||
Investigation and audit related
|
980
|
|
|
1.0
|
%
|
|
696
|
|
|
0.7
|
%
|
|
4,176
|
|
|
1.4
|
%
|
|
37,446
|
|
|
12.1
|
%
|
||||
Amortization of intangible assets
|
6,970
|
|
|
7.4
|
%
|
|
7,896
|
|
|
7.7
|
%
|
|
23,151
|
|
|
7.9
|
%
|
|
24,706
|
|
|
8.0
|
%
|
||||
Impairment of goodwill
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
224,272
|
|
|
76.4
|
%
|
|
—
|
|
|
—
|
%
|
||||
Impairment of intangible asset
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
17,308
|
|
|
5.9
|
%
|
|
—
|
|
|
—
|
%
|
||||
Settlement of litigation, net
|
(2,100
|
)
|
|
(2.2
|
)%
|
|
—
|
|
|
—
|
%
|
|
2,900
|
|
|
1.0
|
%
|
|
5,250
|
|
|
1.7
|
%
|
||||
Restructuring
|
2,270
|
|
|
2.4
|
%
|
|
51
|
|
|
—
|
%
|
|
5,149
|
|
|
1.8
|
%
|
|
5,141
|
|
|
1.7
|
%
|
||||
Total expenses from operations
|
104,059
|
|
|
110.3
|
%
|
|
120,404
|
|
|
117.1
|
%
|
|
598,041
|
|
|
203.8
|
%
|
|
425,601
|
|
|
137.2
|
%
|
||||
Loss from operations
|
(9,759
|
)
|
|
(10.3
|
)%
|
|
(17,540
|
)
|
|
(17.1
|
)%
|
|
(304,559
|
)
|
|
(103.8
|
)%
|
|
(115,429
|
)
|
|
(37.2
|
)%
|
||||
Interest expense, net
|
(8,175
|
)
|
|
(8.7
|
)%
|
|
(4,682
|
)
|
|
(4.6
|
)%
|
|
(23,176
|
)
|
|
(7.9
|
)%
|
|
(11,711
|
)
|
|
(3.8
|
)%
|
||||
Other income (expense), net
|
6,733
|
|
|
7.1
|
%
|
|
(1,711
|
)
|
|
(1.7
|
)%
|
|
6,621
|
|
|
2.3
|
%
|
|
(827
|
)
|
|
(0.3
|
)%
|
||||
Gain (loss) from foreign currency transactions
|
1,194
|
|
|
1.3
|
%
|
|
(304
|
)
|
|
(0.3
|
)%
|
|
768
|
|
|
0.3
|
%
|
|
(181
|
)
|
|
(0.1
|
)%
|
||||
Loss before income taxes
|
(10,007
|
)
|
|
(10.6
|
)%
|
|
(24,237
|
)
|
|
(23.6
|
)%
|
|
(320,346
|
)
|
|
(109.2
|
)%
|
|
(128,148
|
)
|
|
(41.3
|
)%
|
||||
Income tax (provision) benefit
|
(552
|
)
|
|
(0.6
|
)%
|
|
(400
|
)
|
|
(0.4
|
)%
|
|
2,740
|
|
|
0.9
|
%
|
|
(3,916
|
)
|
|
(1.3
|
)%
|
||||
Net loss
|
$
|
(10,559
|
)
|
|
(11.2
|
)%
|
|
$
|
(24,637
|
)
|
|
(24.0
|
)%
|
|
$
|
(317,606
|
)
|
|
(108.2
|
)%
|
|
$
|
(132,064
|
)
|
|
(42.6
|
)%
|
•
|
Ratings and Planning provides measurement of the behavior and characteristics of audiences of content and advertising across television 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, non-linear, 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 September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Variance
|
|
% Variance
|
|||||||||
Ratings and Planning
|
$
|
65,334
|
|
|
69.3
|
%
|
|
$
|
70,499
|
|
|
68.4
|
%
|
|
$
|
(5,165
|
)
|
|
(7.3
|
)%
|
Analytics and Optimization
|
18,252
|
|
|
19.3
|
%
|
|
22,215
|
|
|
21.6
|
%
|
|
(3,963
|
)
|
|
(17.8
|
)%
|
|||
Movies Reporting and Analytics
|
10,714
|
|
|
11.4
|
%
|
|
10,150
|
|
|
10.0
|
%
|
|
564
|
|
|
5.6
|
%
|
|||
Total revenues
|
$
|
94,300
|
|
|
100.0
|
%
|
|
$
|
102,864
|
|
|
100.0
|
%
|
|
$
|
(8,564
|
)
|
|
(8.3
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Variance
|
|
% Variance
|
|||||||||
Ratings and Planning
|
$
|
204,833
|
|
|
69.8
|
%
|
|
$
|
210,569
|
|
|
67.9
|
%
|
|
$
|
(5,736
|
)
|
|
(2.7
|
)%
|
Analytics and Optimization
|
57,003
|
|
|
19.4
|
%
|
|
68,479
|
|
|
22.1
|
%
|
|
(11,476
|
)
|
|
(16.8
|
)%
|
|||
Movies Reporting and Analytics
|
31,646
|
|
|
10.8
|
%
|
|
31,124
|
|
|
10.0
|
%
|
|
522
|
|
|
1.7
|
%
|
|||
Total revenues
|
$
|
293,482
|
|
|
100.0
|
%
|
|
$
|
310,172
|
|
|
100.0
|
%
|
|
$
|
(16,690
|
)
|
|
(5.4
|
)%
|
|
Three Months Ended September 30,
|
|
|
|||||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Data costs
|
$
|
15,316
|
|
|
16.2
|
%
|
|
$
|
14,991
|
|
|
14.6
|
%
|
|
$
|
325
|
|
|
2.2
|
%
|
Employee costs
|
11,606
|
|
|
12.3
|
%
|
|
14,031
|
|
|
13.6
|
%
|
|
(2,425
|
)
|
|
(17.3
|
)%
|
|||
Panel costs
|
5,233
|
|
|
5.5
|
%
|
|
5,743
|
|
|
5.6
|
%
|
|
(510
|
)
|
|
(8.9
|
)%
|
|||
Systems and bandwidth costs
|
4,991
|
|
|
5.3
|
%
|
|
5,984
|
|
|
5.8
|
%
|
|
(993
|
)
|
|
(16.6
|
)%
|
|||
Lease expense and depreciation (1)
|
3,919
|
|
|
4.2
|
%
|
|
3,041
|
|
|
3.0
|
%
|
|
878
|
|
|
28.9
|
%
|
|||
Sample and survey costs
|
1,740
|
|
|
1.8
|
%
|
|
1,354
|
|
|
1.3
|
%
|
|
386
|
|
|
28.5
|
%
|
|||
Professional fees
|
1,704
|
|
|
1.8
|
%
|
|
1,125
|
|
|
1.1
|
%
|
|
579
|
|
|
51.5
|
%
|
|||
Technology
|
1,506
|
|
|
1.6
|
%
|
|
1,679
|
|
|
1.6
|
%
|
|
(173
|
)
|
|
(10.3
|
)%
|
|||
Royalties and resellers
|
921
|
|
|
1.0
|
%
|
|
755
|
|
|
0.7
|
%
|
|
166
|
|
|
22.0
|
%
|
|||
Other
|
454
|
|
|
0.5
|
%
|
|
743
|
|
|
0.7
|
%
|
|
(289
|
)
|
|
(38.9
|
)%
|
|||
Total cost of revenues
|
$
|
47,390
|
|
|
50.3
|
%
|
|
$
|
49,446
|
|
|
48.1
|
%
|
|
$
|
(2,056
|
)
|
|
(4.2
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|||||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Data costs
|
$
|
48,114
|
|
|
16.4
|
%
|
|
$
|
41,758
|
|
|
13.5
|
%
|
|
$
|
6,356
|
|
|
15.2
|
%
|
Employee costs
|
40,708
|
|
|
13.9
|
%
|
|
43,696
|
|
|
14.1
|
%
|
|
(2,988
|
)
|
|
(6.8
|
)%
|
|||
Systems and bandwidth costs
|
15,767
|
|
|
5.4
|
%
|
|
17,864
|
|
|
5.8
|
%
|
|
(2,097
|
)
|
|
(11.7
|
)%
|
|||
Panel costs
|
15,555
|
|
|
5.3
|
%
|
|
17,199
|
|
|
5.5
|
%
|
|
(1,644
|
)
|
|
(9.6
|
)%
|
|||
Lease expense and depreciation (1)
|
11,183
|
|
|
3.8
|
%
|
|
9,473
|
|
|
3.1
|
%
|
|
1,710
|
|
|
18.1
|
%
|
|||
Professional fees
|
5,956
|
|
|
2.0
|
%
|
|
3,855
|
|
|
1.2
|
%
|
|
2,101
|
|
|
54.5
|
%
|
|||
Sample and survey costs
|
5,678
|
|
|
1.9
|
%
|
|
4,532
|
|
|
1.5
|
%
|
|
1,146
|
|
|
25.3
|
%
|
|||
Technology
|
4,422
|
|
|
1.5
|
%
|
|
4,779
|
|
|
1.5
|
%
|
|
(357
|
)
|
|
(7.5
|
)%
|
|||
Royalties and resellers
|
2,629
|
|
|
0.9
|
%
|
|
2,247
|
|
|
0.7
|
%
|
|
382
|
|
|
17.0
|
%
|
|||
Other
|
2,779
|
|
|
0.9
|
%
|
|
2,823
|
|
|
0.9
|
%
|
|
(44
|
)
|
|
(1.6
|
)%
|
|||
Total cost of revenues
|
$
|
152,791
|
|
|
52.1
|
%
|
|
$
|
148,226
|
|
|
47.8
|
%
|
|
$
|
4,565
|
|
|
3.1
|
%
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
16,327
|
|
|
17.3
|
%
|
|
$
|
20,253
|
|
|
19.7
|
%
|
|
$
|
(3,926
|
)
|
|
(19.4
|
)%
|
Lease expense and depreciation (1)
|
1,081
|
|
|
1.1
|
%
|
|
1,582
|
|
|
1.5
|
%
|
|
(501
|
)
|
|
(31.7
|
)%
|
|||
Travel
|
871
|
|
|
0.9
|
%
|
|
1,374
|
|
|
1.3
|
%
|
|
(503
|
)
|
|
(36.6
|
)%
|
|||
Technology
|
749
|
|
|
0.8
|
%
|
|
225
|
|
|
0.2
|
%
|
|
524
|
|
|
232.9
|
%
|
|||
Professional fees
|
651
|
|
|
0.7
|
%
|
|
760
|
|
|
0.7
|
%
|
|
(109
|
)
|
|
(14.3
|
)%
|
|||
Other
|
742
|
|
|
0.8
|
%
|
|
672
|
|
|
0.7
|
%
|
|
70
|
|
|
10.4
|
%
|
|||
Total selling and marketing expenses
|
$
|
20,421
|
|
|
21.7
|
%
|
|
$
|
24,866
|
|
|
24.2
|
%
|
|
$
|
(4,445
|
)
|
|
(17.9
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
55,281
|
|
|
18.8
|
%
|
|
$
|
64,728
|
|
|
20.9
|
%
|
|
$
|
(9,447
|
)
|
|
(14.6
|
)%
|
Lease expense and depreciation (1)
|
4,286
|
|
|
1.5
|
%
|
|
5,554
|
|
|
1.8
|
%
|
|
(1,268
|
)
|
|
(22.8
|
)%
|
|||
Travel
|
2,575
|
|
|
0.9
|
%
|
|
3,694
|
|
|
1.2
|
%
|
|
(1,119
|
)
|
|
(30.3
|
)%
|
|||
Professional fees
|
2,111
|
|
|
0.7
|
%
|
|
2,897
|
|
|
0.9
|
%
|
|
(786
|
)
|
|
(27.1
|
)%
|
|||
Technology
|
2,103
|
|
|
0.7
|
%
|
|
609
|
|
|
0.2
|
%
|
|
1,494
|
|
|
245.3
|
%
|
|||
Other
|
2,234
|
|
|
0.8
|
%
|
|
2,936
|
|
|
0.9
|
%
|
|
(702
|
)
|
|
(23.9
|
)%
|
|||
Total selling and marketing expenses
|
$
|
68,590
|
|
|
23.4
|
%
|
|
$
|
80,418
|
|
|
25.9
|
%
|
|
$
|
(11,828
|
)
|
|
(14.7
|
)%
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
11,080
|
|
|
11.7
|
%
|
|
$
|
14,469
|
|
|
14.1
|
%
|
|
$
|
(3,389
|
)
|
|
(23.4
|
)%
|
Lease expense and depreciation (1)
|
1,483
|
|
|
1.6
|
%
|
|
1,804
|
|
|
1.8
|
%
|
|
(321
|
)
|
|
(17.8
|
)%
|
|||
Technology
|
997
|
|
|
1.1
|
%
|
|
1,260
|
|
|
1.2
|
%
|
|
(263
|
)
|
|
(20.9
|
)%
|
|||
Professional fees
|
442
|
|
|
0.5
|
%
|
|
699
|
|
|
0.7
|
%
|
|
(257
|
)
|
|
(36.8
|
)%
|
|||
Other
|
62
|
|
|
0.1
|
%
|
|
510
|
|
|
0.5
|
%
|
|
(448
|
)
|
|
(87.8
|
)%
|
|||
Total research and development expenses
|
$
|
14,064
|
|
|
14.9
|
%
|
|
$
|
18,742
|
|
|
18.2
|
%
|
|
$
|
(4,678
|
)
|
|
(25.0
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
37,868
|
|
|
12.9
|
%
|
|
$
|
46,186
|
|
|
14.9
|
%
|
|
$
|
(8,318
|
)
|
|
(18.0
|
)%
|
Lease expense and depreciation (1)
|
4,549
|
|
|
1.6
|
%
|
|
5,335
|
|
|
1.7
|
%
|
|
(786
|
)
|
|
(14.7
|
)%
|
|||
Technology
|
3,116
|
|
|
1.1
|
%
|
|
3,833
|
|
|
1.2
|
%
|
|
(717
|
)
|
|
(18.7
|
)%
|
|||
Professional fees
|
2,651
|
|
|
0.9
|
%
|
|
1,650
|
|
|
0.5
|
%
|
|
1,001
|
|
|
60.7
|
%
|
|||
Other
|
979
|
|
|
0.3
|
%
|
|
1,343
|
|
|
0.4
|
%
|
|
(364
|
)
|
|
(27.1
|
)%
|
|||
Total research and development expenses
|
$
|
49,163
|
|
|
16.8
|
%
|
|
$
|
58,347
|
|
|
18.8
|
%
|
|
$
|
(9,184
|
)
|
|
(15.7
|
)%
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
7,235
|
|
|
7.7
|
%
|
|
$
|
7,903
|
|
|
7.7
|
%
|
|
$
|
(668
|
)
|
|
(8.5
|
)%
|
Professional fees
|
4,059
|
|
|
4.3
|
%
|
|
4,639
|
|
|
4.5
|
%
|
|
(580
|
)
|
|
(12.5
|
)%
|
|||
Lease expense and depreciation (1)
|
591
|
|
|
0.6
|
%
|
|
1,138
|
|
|
1.1
|
%
|
|
(547
|
)
|
|
(48.1
|
)%
|
|||
Transition services agreement
|
—
|
|
|
—
|
%
|
|
2,119
|
|
|
2.1
|
%
|
|
(2,119
|
)
|
|
(100.0
|
)%
|
|||
Other
|
2,179
|
|
|
2.3
|
%
|
|
2,908
|
|
|
2.8
|
%
|
|
(729
|
)
|
|
(25.1
|
)%
|
|||
Total general and administrative expenses
|
$
|
14,064
|
|
|
14.9
|
%
|
|
$
|
18,707
|
|
|
18.2
|
%
|
|
$
|
(4,643
|
)
|
|
(24.8
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
27,044
|
|
|
9.2
|
%
|
|
$
|
30,308
|
|
|
9.8
|
%
|
|
$
|
(3,264
|
)
|
|
(10.8
|
)%
|
Professional fees
|
13,618
|
|
|
4.6
|
%
|
|
16,519
|
|
|
5.3
|
%
|
|
(2,901
|
)
|
|
(17.6
|
)%
|
|||
Lease expense and depreciation (1)
|
1,902
|
|
|
0.7
|
%
|
|
3,297
|
|
|
1.1
|
%
|
|
(1,395
|
)
|
|
(42.3
|
)%
|
|||
Transition services agreement
|
667
|
|
|
0.2
|
%
|
|
6,967
|
|
|
2.2
|
%
|
|
(6,300
|
)
|
|
(90.4
|
)%
|
|||
Other
|
7,310
|
|
|
2.5
|
%
|
|
8,976
|
|
|
2.9
|
%
|
|
(1,666
|
)
|
|
(18.6
|
)%
|
|||
Total general and administrative expenses
|
$
|
50,541
|
|
|
17.2
|
%
|
|
$
|
66,067
|
|
|
21.3
|
%
|
|
$
|
(15,526
|
)
|
|
(23.5
|
)%
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Change in fair value of financing derivatives
|
$
|
1,800
|
|
|
$
|
(5,681
|
)
|
|
$
|
2,900
|
|
|
$
|
(10,141
|
)
|
Change in fair value of warrants liability
|
4,893
|
|
|
—
|
|
|
4,893
|
|
|
—
|
|
||||
Change in fair value of investment in equity securities
|
(308
|
)
|
|
42
|
|
|
(2,324
|
)
|
|
307
|
|
||||
Transition services agreement income
|
—
|
|
|
2,120
|
|
|
534
|
|
|
6,967
|
|
||||
Other
|
348
|
|
|
1,808
|
|
|
618
|
|
|
2,040
|
|
||||
Total other income (expense), net
|
$
|
6,733
|
|
|
$
|
(1,711
|
)
|
|
$
|
6,621
|
|
|
$
|
(827
|
)
|
•
|
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 fees incurred in connection with issuance of equity securities, restructuring, litigation and the Audit Committee investigation, such as litigation and investigation-related costs, costs associated with tax projects, 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 that represent dilution to our existing stockholders;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider impairment of goodwill and long-lived assets, which represents a decline in the value of our assets;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider possible cash gains or losses related to our financing derivatives, warrants liability 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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss (GAAP)
|
$
|
(10,559
|
)
|
|
$
|
(24,637
|
)
|
|
$
|
(317,606
|
)
|
|
$
|
(132,064
|
)
|
|
|
|
|
|
|
|
|
||||||||
Income tax provision (benefit)
|
552
|
|
|
400
|
|
|
(2,740
|
)
|
|
3,916
|
|
||||
Interest expense, net
|
8,175
|
|
|
4,682
|
|
|
23,176
|
|
|
11,711
|
|
||||
Depreciation
|
3,336
|
|
|
4,135
|
|
|
9,447
|
|
|
12,974
|
|
||||
Amortization expense of finance leases
|
613
|
|
|
—
|
|
|
1,974
|
|
|
—
|
|
||||
Amortization of intangible assets
|
6,970
|
|
|
7,896
|
|
|
23,151
|
|
|
24,706
|
|
||||
EBITDA
|
9,087
|
|
|
(7,524
|
)
|
|
(262,598
|
)
|
|
(78,757
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation
|
3,013
|
|
|
6,311
|
|
|
14,270
|
|
|
31,191
|
|
||||
Investigation and audit related
|
980
|
|
|
696
|
|
|
4,176
|
|
|
37,446
|
|
||||
Settlement of litigation, net
|
(2,100
|
)
|
|
—
|
|
|
2,900
|
|
|
5,250
|
|
||||
Restructuring
|
2,270
|
|
|
51
|
|
|
5,149
|
|
|
5,141
|
|
||||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
224,272
|
|
|
—
|
|
||||
Impairment of intangible asset
|
—
|
|
|
—
|
|
|
17,308
|
|
|
—
|
|
||||
Private placement issuance cost (1)
|
(416
|
)
|
|
—
|
|
|
738
|
|
|
—
|
|
||||
Other (income) expense, net (2)
|
(6,385
|
)
|
|
5,699
|
|
|
(5,469
|
)
|
|
9,834
|
|
||||
Adjusted EBITDA
|
$
|
6,449
|
|
|
$
|
5,233
|
|
|
$
|
746
|
|
|
$
|
10,105
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net loss (GAAP)
|
$
|
(10,559
|
)
|
|
$
|
(24,637
|
)
|
|
$
|
(317,606
|
)
|
|
$
|
(132,064
|
)
|
|
|
|
|
|
|
|
|
||||||||
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation
|
3,013
|
|
|
6,311
|
|
|
14,270
|
|
|
31,191
|
|
||||
Investigation and audit related
|
980
|
|
|
696
|
|
|
4,176
|
|
|
37,446
|
|
||||
Amortization of intangible assets (1)
|
6,970
|
|
|
7,896
|
|
|
23,151
|
|
|
24,706
|
|
||||
Settlement of litigation, net
|
(2,100
|
)
|
|
—
|
|
|
2,900
|
|
|
5,250
|
|
||||
Restructuring
|
2,270
|
|
|
51
|
|
|
5,149
|
|
|
5,141
|
|
||||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
224,272
|
|
|
—
|
|
||||
Impairment of intangible asset
|
—
|
|
|
—
|
|
|
17,308
|
|
|
—
|
|
||||
Private placement issuance cost (2)
|
(416
|
)
|
|
—
|
|
|
738
|
|
|
—
|
|
||||
Other (income) expense, net (3)
|
(6,385
|
)
|
|
5,699
|
|
|
(5,469
|
)
|
|
9,834
|
|
||||
Non-GAAP net loss
|
$
|
(6,227
|
)
|
|
$
|
(3,984
|
)
|
|
$
|
(31,111
|
)
|
|
$
|
(18,496
|
)
|
|
|
Nine Months Ended September 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Net cash used in operating activities
|
|
$
|
(3,124
|
)
|
|
$
|
(73,939
|
)
|
Net cash used in investing activities
|
|
(7,834
|
)
|
|
(9,630
|
)
|
||
Net cash provided by financing activities
|
|
19,908
|
|
|
93,798
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
(658
|
)
|
|
(1,140
|
)
|
||
Net increase in cash, cash equivalents and restricted cash
|
|
8,292
|
|
|
9,089
|
|
(In thousands)
|
|
Total
|
|
Less Than
1 Year |
|
1-3 Years
|
|
3-5
Years |
|
More
Than 5 Years |
||||||||||
Operating lease obligations (1)
|
|
$
|
78,441
|
|
|
$
|
13,077
|
|
|
$
|
22,124
|
|
|
$
|
18,425
|
|
|
$
|
24,815
|
|
Finance lease obligations (2)
|
|
4,940
|
|
|
2,068
|
|
|
2,813
|
|
|
59
|
|
|
—
|
|
|||||
Software license arrangements (3)
|
|
739
|
|
|
369
|
|
|
370
|
|
|
—
|
|
|
—
|
|
|||||
Sale-leaseback financing transaction (4)
|
|
4,231
|
|
|
2,247
|
|
|
1,984
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt obligations (5)
|
|
204,000
|
|
|
—
|
|
|
204,000
|
|
|
—
|
|
|
—
|
|
|||||
Unconditional purchase obligations with MVPDs (6)
|
|
112,699
|
|
|
40,873
|
|
|
48,740
|
|
|
23,086
|
|
|
—
|
|
|||||
Total
|
|
$
|
405,050
|
|
|
$
|
58,634
|
|
|
$
|
280,031
|
|
|
$
|
41,570
|
|
|
$
|
24,815
|
|
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
|
•
|
Enhanced controls related to manual journal entries to strengthen the completeness and accuracy of revenue-related entries;
|
•
|
Enhanced controls, including new automated reports, to demonstrate and verify evidence of product or service delivery;
|
•
|
Enhanced communication between financial and operating personnel to better monitor the status of product and service delivery;
|
•
|
Centralized responsibility for product and service delivery under one department and implemented a monthly attestation process for key operating personnel;
|
•
|
Implemented mandatory training for operational and revenue personnel who are responsible for product or service delivery and revenue recognition;
|
•
|
Enhanced controls over unbilled revenue and deferred revenue account reconciliations, including the review and timely analysis of reconciling items; and
|
•
|
Implemented a business process review control that compares our actual results to our forecast and historical results.
|
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
|
|
COMSCORE, INC.
|
|||
|
|
|
||
|
By:
|
/s/ Gregory A. Fink
|
||
|
|
Gregory A. Fink
|
||
|
|
Chief Financial Officer and Treasurer
|
||
|
|
(Principal Financial Officer, Principal Accounting Officer and Duly Authorized Officer)
|
|
|
Exhibit 10.1
|
|
|
|
•
|
Annualized base salary of $650,000, less applicable taxes and other withholdings, payable in accordance with the Company's payroll practices in effect from time to time.
|
•
|
Eligibility to participate in the Company's short-term incentive program ("STIP") with a target annual short-term incentive equal to 100% of Executive's annualized base salary, subject to the terms and conditions of the Company's STIP as in effect from time to time.
|
•
|
Eligibility to participate in the Company's annual long-term incentive program ("LTIP") on the same terms as provided to other executive officers from time to time, subject to the terms and conditions of the Company's LTIP as in effect from time to time.
|
•
|
Eligibility to participate in those employee benefit plans and programs (e.g., health, dental, vacation, etc.) and business expense reimbursements that the Company makes available
|
|
|
PAGE 1
|
•
|
Upon approval by the Board of Directors (the "Board") or the Compensation Committee of the Board (the "Committee"), a one-time grant under (and pursuant to the terms of) the comScore, Inc. 2018 Equity and Incentive Compensation Plan (the "Plan") of 175,000 restricted stock units (the "RSUs"), which will vest as to one-third on each of the first three anniversaries of the date of grant. The RSUs are subject to (i) the terms and conditions determined by the Board or the Committee (consistent with this Letter), (ii) deferred settlement upon the earlier to occur of a "change in control event" or Executive's "separation from service" (in each case, within the meaning of Section 409A of the Internal Revenue Code of 1986, "Section 409A")) and (iii) Executive's continued employment or service with the Company or one of its affiliates through each vesting date; provided, that the RSUs will fully vest upon a termination of Executive's employment or service by the Company without Cause (as defined in the Severance Agreement) or resignation for Good Reason (as defined in the Severance Agreement), in each case: (i) such that as a result of such termination or resignation, Executive is no longer employed by or providing services to the Company or any of its affiliates; and (ii) within 12 months following a Change in Control (as defined in the Plan).
|
•
|
Upon approval by the Board or the Committee, a one-time grant under (and pursuant to the terms of) the Plan of options to purchase 300,000 shares of the Company's common stock, with a per share exercise price equal to the fair market value of a share of the Company's common stock on the date of grant (the "Options"), which will vest as to one-third on each of the first three anniversaries of the date of grant. The Options are subject to (i) the terms and conditions determined by the Board or the Committee (consistent with this Letter), and (ii) Executive's continued employment or service with the Company or one of its affiliates through each vesting date; provided, that the Options will fully vest upon a termination of Executive's employment or service by the Company without Cause or resignation for Good Reason, in each case, (a) such that as a result of such termination or resignation, Executive is no longer employed by or providing services to the Company or any of its affiliates and (b) such termination or resignation is within 12 months following a Change in Control; provided, further, that Executive will have 90 days (or until the Option's 10-year expiration date, if earlier) to exercise any vested Options following such termination or resignation.
|
•
|
Upon approval by the Board or the Committee, a one-time grant under (and pursuant to the terms of) the Plan of 425,000 performance restricted stock units (the "PRSUs"), which will vest quarterly from the date of grant through the tenth anniversary of the date of grant or an earlier Change in Control, subject to and in accordance with the achievement of each of the following stock-price hurdles on or prior to such date:
|
|
|
PAGE 2
|
Stock-Price Hurdle*
|
|
Percentage of PRSUs That Vest
|
For each $1 above $4, up to and including $10
|
|
16.66%
|
•
|
Subject to satisfaction of the conditions set forth in this paragraph, Executive will earn a one-time bonus of at least $1,000,000 (either individually or as part of a larger pool for executives or employees), payable at the Company's election in cash, stock or a combination thereof, upon (but in no event later than 74 days following) the successful completion of a refinance of all or substantially all of the Company's outstanding senior secured convertible notes (the "Refinance Bonus"), subject to Executive's continued employment through the completion of such refinance; provided, that if Executive's employment is terminated by the Company without Cause or Executive resigns for Good Reason (in each case such that Executive is no longer employed by the Company or any of its affiliates) within the 90-day period preceding the completion of the refinance, Executive will remain eligible to receive the Refinance Bonus upon the completion of such refinance.
|
•
|
Subject to satisfaction of the conditions set forth in this paragraph, Executive will earn a one-time cash bonus, payable within 74 days following the consummation of a Qualifying Change in Control (as defined below), in an amount determined in accordance with the following (as applicable, the "CIC Bonus"):
|
o
|
Bonus equal to 0.30% of the gross transaction proceeds (but no less than $1,500,000) upon a Qualifying Change in Control that results in gross transaction proceeds of at least $500,000,000 but less than $750,000,000;
|
o
|
Bonus equal to 0.31% of the gross transaction proceeds upon a Qualifying Change in Control that results in gross transaction proceeds of at least $750,000,000 but less than $1,250,000,000; or
|
|
|
PAGE 3
|
o
|
Bonus equal to 0.32% of the gross transaction proceeds (but no more than $4,000,000) upon a Qualifying Change in Control that results in gross transaction proceeds of at least $1,250,000,000.
|
•
|
Subject to satisfaction of the conditions set forth in this paragraph, Executive will earn an additional one-time cash bonus of $1,000,000, payable within 74 days following the consummation of a Qualifying Change in Control (the "Additional CIC Bonus"), subject to Executive's continued employment through the consummation of such Qualifying Change in Control; provided, that if Executive's employment is terminated by the Company without Cause or Executive resigns for Good Reason (in each case, such that, as a result of such termination or resignation, Executive is no longer employed by the Company or any of its affiliates) within the 90-day period preceding the consummation of such Change in Control, Executive will remain eligible to receive the Additional CIC Bonus upon the consummation of such Qualifying Change in Control.
|
•
|
Payment of Executive's attorney's fees in the amount of $200,000.
|
|
|
PAGE 4
|
|
|
PAGE 5
|
|
|
PAGE 6
|
|
|
PAGE 7
|
|
|
PAGE 8
|
|
|
PAGE 9
|
|
|
PAGE 10
|
|
|
Sincerely,
|
|
|
|
|
|
|
|
COMSCORE, INC.
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Carol DiBattiste
|
|
|
Carol DiBattiste
|
|
|
|
General Counsel and Chief Compliance,
|
|
|
|
People and Privacy Officer
|
ACKNOWLEDGED AND AGREED:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/ William P. Livek
|
|
|
|
|
William P. Livek
|
|
|
|
|
|
|
|
|
|
Date:
|
November 4, 2019
|
|
|
|
|
|
PAGE 11
|
/s/ William P. Livek
|
William P. Livek
|
Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|
/s/ William P. Livek
|
William P. Livek
|
Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|